Vikram Singh, Karnal V. ITO, Karnal

ITA 1180/DEL/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 65402 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 5 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-08-2012
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: H
• Next Hearing Date: 28-08-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 04-03-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MRS SHUMANA SEN
• Assessee Lawyers: NEERAJ GARG
• Keywords: Unexplained cash credit; Depreciation; Opportunity of being heard

Judgement Text

ITA NO. 1180/DEL/2011 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH H, NEW DELHI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER AND SHRI C.M. GARG, JUDICIAL MEMBER I.T.A. NO. 1180/DEL/2011 A.Y. : 2007-08 VIKRAM SINGH PROP., VIKARAM SINGH ASHOK KUMAR, NEW GRAIN MARKET, SHOP NO. 92, INDRI DISTT. KARNAL, VS. ITO, WARD NO. 4, KARNAL (APPELLANT ) (APPELLANT ) (APPELLANT ) (APPELLANT ) (RESPONDENT ) (RESPONDENT ) (RESPONDENT ) (RESPONDENT ) ASSESSEE BY : SH. NEERAJ GARG, CA DEPARTMENT BY : MRS. SHUMANA SEN, SR. D.R. ORDER ORDER ORDER ORDER PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS), KARNAL DA TED 27.12.2010 PERTAINING TO ASSESSMENT YEAR 2007-08. 2. THE GROUNDS RAISED READ AS UNDER:- I) THAT THE ORDER PASSED BY ASSESSING OFFICER IS ILLEGAL, ARBITRARY HAS BEEN PASSED IN A HASTE AND H AS IGNORED BASIC ASPECTS AND FACTS OF THE CASE AND LD . COMMISSIONER OF INCOME TAX (A) ERRED IN CONFIRMING THE SAME, THUS CAUSING UNDUE HARDSHIP TO THE ASSESSEE. ITA NO. 1180/DEL/2011 2 II) THAT THE ASSESSING OFFICER HAS ERRED IN DISALLOWING DEPRECIATION OF ` 3986129.00, WHICH IS ILLEGAL, UNJUSTIFIED AND AGAINST THE NATURAL LAW OF JUSTICE AND LD. COMMISSIONER OF INCOME TAX (A) ERRED IN CONFIRMING THE SAME. IT IS DESERVES TO BE QUASHED. III) THAT THE ASSESSING OFFICER HAS ERRED IN ADDI TION OF UNSECURED LOAN OF ` 153702/- ON THE GROUND THAT HERE IS A MINOR DIFFERENCE IN CONFIRMATION SUBMITTED AND STATEMENT RECORDING YET THEY CONFIRMED THAT THE Y GIVE THE UNSECURED LOAN. WHICH IS ILLEGAL, UNJUSTIF IED AND AGAINST THE NATURAL LAW OF JUSTICE AND LD. COMMISSIONER OF INCOME TAX (A) ERRED IN CONFIRMING THE SAME. IV) THAT THE APPELLANT CRAVES TO ADD, DELETE, CONCEDE, MODIFY ANY OR ALL THE GROUNDS OF APPEAL AT THE TIME OF HEARING OF APPEAL. 3. APROPOS ADDITION OF UNSECURED LOAN: IN THIS CASE ASSESSING OFFICER NOTED THAT ASSESSEE HAS SHOWN FRESH UNSECURED LOANS BELOW ` 20,000/- IN THE NAMES OF VA RIOUS PERSONS. ASSESSEE WAS ASKED TO FURNISH THE NECESSARY EVIDENC E TO PROVE THE GENUINENESS OF THE LOANS AND WAS ALSO REQUESTED TO PRODUCE SOME OF THEM FOR VERIFICATION. AFTER GOING THROUGH THE AS SESSEES SUBMISSIONS ASSESSING OFFICER NOTED THAT ASSESSEE HAS NEITHER FURNISHED ANY EVIDENCE NOR PRODUCED THE CREDITORS IN THE FOLLOWIN G CASES:- I) SH. NARESH KUMAR, INDRI - ` 18,623/- ITA NO. 1180/DEL/2011 3 II) SH. MANGAT - ` 12,000/- IN RESPECT OF THE FOLLOWING ASSESSEE FURNISHED CO NFIRMATION FROM THEM:- I) HUKAM SINGH - ` 18,997/- II) DEEPA SINGH - ` 19,978/- III) RAM PAL - ` 19,393/- IV) BHAGAT RAM - ` 12,000/- V) ASHOK KUMAR - ` 14,000/- VI) LAKHA SINGH - ` 19,211/- VII) JAI PAL SINGH - ` 19,500/- 3.1 ASSESSING OFFICER FURTHER NOTED THAT THERE ARE CERTAIN DISCREPANCIES IN THE CONFIRMATIONS GIVEN BY THE CRE DITORS AND THE STATEMENTS RECORDED BY THE ASSESSING OFFICER. ASSE SSING OFFICER HELD THAT SINCE THE ASSESSEE HAS FAILED TO PROVE THE CA SH CREDIT IN THE ABOVE NAMES AND THE AMOUNTS INDICATED AGAINST EACH, THE AMOUNT AGGREGATING TO ` 1,53,702/- IS ADDED TO THE INCOME OF THE ASSESSEE AS UNEXPLAINED CASH CREDIT U/S. 68. 4. UPON ASSESSEES APPEAL LD. COMMISSIONER OF INCOME TAX (A) NOTED THAT ASSESSEE IS REQUIRED TO ESTABLISH ALL TH E THREE INGREDIENTS VIZ., IDENTITY OF THE CREDITOR, CAPACITY/ SOURCE OF ADVANCING THE SAID FUND AND GENUINENESS OF THE TRANSACTION. LD. CO MMISSIONER OF INCOME TAX (A) NOTED THAT IN THE CASE UNDER CONSIDE RATION, THE ASSESSING OFFICER POINTED OUT THE CONTRADICTIONS I N THE SOURCE OF THE SAID ADVANCES MADE IN THE CONFIRMATION AND THAT IN THE STATEMENT RECORDED OF THE CREDITORS. LD. COMMISSIONER OF IN COME TAX (A) NOTED THAT ASSESSEE TRIED TO EXPLAIN THESE CONTRADICTIONS THAT THE CREDITORS COULD NOT RECOLLECT THE EXACT SOURCE OF MAKING THE SAID ADVANCE. LD. ITA NO. 1180/DEL/2011 4 COMMISSIONER OF INCOME TAX (A) FURTHER OBSERVED THAT IN VIEW OF THE POOR FINANCIAL POSITION OF THE CREDITORS, THEY COUL D NOT BE MAKING LOANS / ADVANCES FREQUENTLY/ REGULARLY AND HENCE PL EA OF THE ASSESSEE IS NOT TENABLE. LD. COMMISSIONER OF INCOME TAX (A) CONFIRMED THE ASSESSING OFFICERS ACTION IN THIS REGARD. 5. AGAINST THE ABOVE ORDER THE ASSESSEE IS IN APPE AL BEFORE US. 6. WE HAVE HEARD THE RIVAL CONTENTIONS IN LIGHT OF THE MATERIAL PRODUCED AND PRECEDENT RELIED UPON. WE FIND THAT ASSESSING OFFICER IN THIS CASE HAS BROUGHT ADVERSE INFERENCE REGARDI NG THE CREDITS AGAINST THE LOAN CREDITORS, BECAUSE THERE WERE CON TRADICTIONS IN THE CONFIRMATIONS GIVEN BY THEM AND THE STATEMENT RECORDED BY THE ASSESSING OFFICER. IT WAS FURTHER FOUND THAT ASS ESSEE HAS GIVEN THE NAMES AND ADDRESSES OF ALL THE PERSONS AND ASSESSING OFFICER HAD NOT SUMMONED THESE PERSONS TO RECORD THEIR STATEMENTS. I N THIS REGARD, ASSESSEE HAS SUBMITTED THAT THE MATTER MAY BE REMITTE D BACK TO THE ASSESSING OFFICER TO ENABLE HIM TO EXAMINE THE ISSU E AFRESH, AFTER GIVING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE A SSESSEE. 6.1 LD. DEPARTMENTAL REPRESENTATIVE SUPPORTED THE OR DERS OF THE AUTHORITIES BELOW. 7. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS. IN OUR CONSIDERED OPINION, INTEREST OF JUSTICE WILL BE SER VED, IF THE MATTER IS REMITTED TO THE FILE OF THE ASSESSING OFFICER. HE NCE, THE MATTER IS REMITTED TO THE FILE OF THE ASSESSING OFFICER. THE A SSESSING OFFICER IS DIRECTED TO EXAMINE THE ISSUE AFRESH, AFTER GIVING T HE ADEQUATE OPPORTUNITY OF BEING HEARD. 8. APROPOS DEPRECIATION ` 3986129/- ITA NO. 1180/DEL/2011 5 THE ABOVE ISSUE IS NOT ARISING OUT OF LD. COMMISSION ER OF INCOME TAX (A)S ORDER. HENCE THE SAME IS DISMISSED. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 31/8/2012. SD/- SD/- [ [[ [C.M. GARG C.M. GARG C.M. GARG C.M. GARG] ]] ] [SHAMIM YAHYA] [SHAMIM YAHYA] [SHAMIM YAHYA] [SHAMIM YAHYA] JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER DATE 31/8/2012 SRBHATNAGAR SRBHATNAGAR SRBHATNAGAR SRBHATNAGAR COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: - -- - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES