AMIT KUMAR, ALLAHABAD V. INCOME TAX OFFICER RANGE-2(1), ALLAHABAD

ITA 122/ALLD/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 8888 (ITAT-ALLAHABAD)
• Duration Of Justice: 1 year(s) 9 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-08-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2005-2006
• Appeal Filed On: 17-10-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained investment; Opportunity of being heard; Principle of natural justice; Corroborative evidences; Set aside
• Section: 143(1); 143(2); 139(1); 147; 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL ALLAHABAD SMC BENCH, ALLAHABAD (THROUGH VIRTUAL COURT) BEFORE SHRI.VIJAY PAL RAO, JUDICIAL MEMBER ITA NO.122/ALLD/2019 ASSESSMENT YEAR: 2005-06 SRI. AMIT KUMAR, S/O LAXMI CHAND, 384, SULEM SARAI, ALLAHABAD, U.P. PAN-AMWPK3964B V. INCOME TAX OFFICER, WARD-2(1) ALLAHABAD, U.P. (APPELLANT) (RESPONDENT) APPELLANT BY: MR. PRAVEEN GODBOLE, C.A. RESPONDENT BY: MR. A.K. SINGH, SR. DR DATE OF HEARING: 02.08.2021 DATE OF PRONOUNCEMENT: .08.2021 O R D E R PER SHRI VIJAY PAL RAO, JUDICIAL MEMBER: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 27.08.2019 OF CIT(A) FOR THE ASSESSMENT YEAR 2005-06. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS. 1-THAT IN ANY VIEW OF THE MATTER EX-PARTE ASSESSMENT ORDER DATED 24.12.2009 PASSED U/S 144/147 OF THE IT ACT BY THE ASSESSING OFFICER AND HIS ACTION AS CONFIRMED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL) DATED 27.08.2019 BY HIS ORDER DATED 27.08.2019 PASSED WITHOUT APPRECIATING THE CORRECT FACTS ARE BAD BOTH ON THE FACTS AND IN LAW AND THEREFORE THE DECLARED INCOME SHOULD HAVE BEEN ACCEPTED IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 2-THAT IN ANY VIEW OF THE MATTER THE NOTICE U/S 148 IS ILLEGAL, INVALID AND WITHOUT JURISDICTION AS THE DATE OF ISSUE OF THE NOTICE AND DATE OF REASONS RECORDED ARE NOT OF THE SAME DAY WHICH FACT IS CLEARLY VISIBLE ON THE NOTICE U/S 148 OF THE IT ACT AS ALLEGED TO BE ISSUED AS THE 'WHITENER' WAS USED FOR ALTERING THE DATE AND TO HIDE THE TRUE FACTS BUT INSPITE OF THIS FACTUALITY OBSERVATIONS OF THE TWO LOWER AUTHORITIES IN THEIR ORDERS ARE TOTALLY INCORRECT AND REFLECT UNFORTUNATE ATTEMPT TO COVER UP THE LAPSES ON THE COST OF THE POOR APPELLANT WHICH IS INJUSTICE. ITA NO.122/ALLD/2019 SRI AMIT KUMAR 2 3-THAT IN ANY VIEW OF THE MATTER BOTH THE LOWER AUTHORITIES ACTED IN UNJUDICIOUS MANNER AND MENTIONED MIS-LEADING OBSERVATIONS IN THEIR ORDERS TO COVER & PROTECT THE LAPSESAND ERROR BY IGNORING THE FACTS THAT THE SIGNATURE OF THE AUTHORITY WHO RECORDED THE REASONS & SIGNATURE OF THE AUTHORITY WHO ISSUED THE NOTICE U/S 148 OF THE IT ACT ARE VERIFYING WHICH IS CLEARLY VISIBLE FROM BOTH THE DOCUMENTS, THEREFORE THE ENTIRE ASSESSMENT IS BAD IN LAW AND EVEN REASONS FOR ISSUE OF NOTICE IS NOT SUFFICIENT. 4-THAT IN ANY VIEW OF THE MATTER BOTH THE LOWER AUTHORITIES ERRED IN PASSING AND CONFIRMING EX-PARTY ORDER IN ARBITRARY MANNER WITHOUT PROVIDING PROPER AND REASONABLE OPPORTUNITY OF BEING HEARD TO THE APPELLANT WHICH IS ILLEGAL AND VIOLATION OF NATURAL JUSTICE. 5-THAT IN ANY VIEW OF THE MATTER VOLUMINOUS EVIDENCES REGARDING FUND UTILIZED IN INVESTMENT OF THE PROPERTY WERE PRODUCED BUT THE SAME WERE IGNORED BY THE TWO LOWER AUTHORITIES NOR DISCUSSED BY THEM IN THEIR ORDERS AND THE ADDITION WAS MADE AND CONFIRMED IN ARBITRARY MANNER WHEN THE INVESTMENT WAS FROM DEFINITE SOURCES WHICH IS UNJUSTIFIED AND WRONG AND HENCE THE ADDITION IS LIABLE TO BE DELETED. 6-THAT IN ANY VIEW OF THE MATTER THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL) FAILED TO DISCUSSED AND MENTION THE ADDITIONAL GROUND RAISED BY THE ASSESSEE IN THE ORDER AND IN THIS REGARD THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEAL) TOTALLY SILENT HENCE THE ORDER IS WRONG AND INVALID. 7-THAT IN ANY VIEW OF THE MATTER THE OBSERVATIONS, FINDINGS AND ALLEGATION OF THE FIRST APPELLATE AUTHORITY IN HIS ORDER FOR MAINTAINING THE EX-PARTE ASSESSMENT ORDER ARE QUITE UNJUSTIFIED, INCORRECT, MISLEADING AND CONTRARY TO THE ACTUAL FACTS OF THE CASE, HENCE THE SAME ARE LIABLE TO BE SPONGED OFF IN INTEREST OF JUSTICE. 8- THAT IN ANY VIEW OF THE MATTER ADDITION OF RS.8,97,500/- MADE U/S 69 OF THE IT ACT BY THE ASSESSING OFFICER BY ALLEGING UNEXPLAINED INVESTMENT IN PROPERTY AND HIS ACTION AS CONFIRMED BY THE COMMISSIONER OF INCOME TAX (APPEAL) VIDE HIS ORDER WITHOUT APPRECIATING THE CORRECT FACT THAT THE INVESTMENT WAS MADE FROM DEFINITE SOURCE , ARE TOTALLY UNJUSTIFIED & ILLEGAL AND HENCE THE ADDITION IS LIABLE TO BE DELETED IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 9- THAT IN ANY VIEW OF THE MATTER THE ADDITION OF RS.10,360/- MADE U/S 68 OF THE IT ACT WITHOUT ANY BASIS BY THE ASSESSING OFFICER AND THE SAME AS MAINTAINED BY THE FIRST APPELLATE AUTHORITY IN HASTE BY IGNORING THE CORRECT FACTS IS HIGHLY UNJUSTIFIED, INCORRECT AND ILLEGAL IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND HENCE THE ADDITION IS LIABLE TO BE DELETED. 10- THAT IN ANY VIEW OF THE MATTER THE INTEREST AS CHARGED UNDER DIFFERENT SECTIONS OF THE IT ACT IS HIGHLY UNJUSTIFIED. 11-THAT IN ANY VIEW OF THE MATTER THE APPELLANT RESERVES HIS RIGHT TO TAKE ANY FRESH GROUND BEFORE HEARING OF THE APPEAL. ITA NO.122/ALLD/2019 SRI AMIT KUMAR 3 2. THE ASSESSEE IS AN INDIVIDUAL AND DERIVES INCOME FROM THE BUSINESS OF TRADING IN CLOTHES. THE ASSESSEE FILED HIS RETURN OF INCOME UNDER SECTION 139(1) OF THE ACT ON 14.10.2015 WHICH WAS PROCESSED UNDER SECTION 143(1) OF THE ACT. SUBSEQUENTLY, THE ASSESSING OFFICER REOPENED THE ASSESSMENT BY ISSUING THE NOTICE UNDER SECTION 148 ON 27.03.2009 WHEREBY PROPOSED TO ASSESS THE INCOME ON ACCOUNT OF UNEXPLAINED SOURCE OF INVESTMENT IN PURCHASE OF THE PROPERTY. DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS, THE ASSESSEE HAS CLAIMED THAT HE IS CO-OWNER OF THE PROPERTY IN QUESTION WHICH WAS PURCHASED FOR A CONSIDERATION OF RS. 12,50,000/- AND TOTAL COST OF RS. 17,95,000/- AND THE ASSESSEE IS HAVING ONE HALF SHARES OF THE INVESTMENT WHICH GOES TO RS. 8,97,500/-. THE ASSESSEE EXPLAINED THE SOURCE OF INVESTMENT AS AMOUNT RECEIVED FROM HIS SISTER, FROM FRIENDS & RELATIVES, SALE PROCEEDS OF ORNAMENTS AND SMALL AMOUNT FROM HIS OWN SOURCE. THE ASSESSING OFFICER COMPLETED THE ASSESSMENT BY MAKING ADDITION OF THE ENTIRE SHARE OF INVESTMENT OF RS. 8,97,500/- AS WELL AS UNEXPLAINED DEPOSITS IN THE BANK ACCOUNT OF RS. 10,360/-. THE ASSESSEE CHALLENGED THE ACTION OF THE ASSESSING OFFICER BEFORE THE CIT(A) BUT COULD NOT SUCCEED. 3. BEFORE THE TRIBUNAL, THE LEARNED AR OF THE ASSESSEE HAS SUBMITTED THAT THE ASSESSING OFFICER HAS PASSED AN EX PARTE ASSESSMENT UNDER SECTION 144 READ WITH SECTION 147 WITHOUT GIVING SUFFICIENT OPPORTUNITY OF HEARING TO THE ASSESSEE TO PRODUCE THE RELEVANT DETAILS AND SUPPORTING EVIDENCE. HE HAS POINTED OUT THAT THE ASSESSING OFFICER ISSUED NOTICE UNDER SECTION 143(2) ON 19.11.2019 WHICH WAS RECEIVED BY THE ASSESSEE ON 25.11.2019. THE ASSESSING OFFICER FIXED THE DATE OF COMPLIANCE ON 30.11.2019 AND THEREAFTER COMPLETED THE ASSESSMENT ON 24 TH DECEMBER, 2009. THE ASSESSEE WAS NOT GIVEN AN APPROPRIATE OPPORTUNITY OF HEARING AND TO PRODUCE THE LOAN CREDITORS BEFORE THE ASSESSING OFFICER IN SUPPORT OF HIS CLAIM OF SOURCE OF INVESTMENT. HE HAS POINTED OUT THAT DUE TO PAUCITY OF TIME, THE ASSESSEE COULD NOT PRODUCE ALL THE LOAN CREDITORS BEFORE THE ASSESSING OFFICER BUT PRODUCED ONLY FOUR LOAN CREDITORS ONE OF WHOM IS THE SISTER OF THE ASSESSEE AND THREE RELATIVES & FRIENDS. THE ASSESSING OFFICER HAS MADE THE ADDITION ON THE GROUND THAT ASSESSEE ITA NO.122/ALLD/2019 SRI AMIT KUMAR 4 COULD NOT PRODUCE THE REMAINING LOAN CREDITORS AS WELL AS THE PROOF OF SALE OF ORNAMENTS. THE LEARNED AR HAS POINTED OUT THAT BEFORE THE CIT(A), THE ASSESSEE HAS PRODUCED CONFIRMATIONS FROM LOAN CREDITORS BUT THE CIT(A) WITHOUT CONSIDERING EVIDENCE HAS CONFIRMED THE ADDITION MADE BY THE ASSESSING OFFICER. HE HAS ALSO POINTED OUT THAT IN THE CASE OF THE FATHER OF THE ASSESSEE WHO IS THE CO-OWNER OF THE PROPERTY IN QUESTION, THE TRIBUNAL HAS REMANDED THE MATTER BACK TO THE RECORD OF THE CIT(A)FOR FRESH ADJUDICATION AS IN THE SAID CASE, THE CIT(A) PASSED AN EX PARTE ORDER. THUS , THE LEARNED AR HAS PLEADED THAT THE CASE MAY BE SET ASIDE TO THE RECORD OF THE ASSESSING OFFICER FOR GRANTING AN OPPORTUNITY TO THE ASSESSE TO PRODUCE ALL THE RELEVANT RECORDS AS WELL AS LOAN CREDITORS. 4. ON THE OTHER HAND, LEARNED DR HAS SUBMITTED THAT THE ASSESSING OFFICER GRANTED THE OPPORTUNITY TO THE ASSESSEE TO PRODUCE THE SUPPORTING EVIDENCE AND LOAN CREDITORS HOWEVER, THE ASSESSEE FAILED TO PRODUCE ANY DOCUMENTARY EVIDENCE IN SUPPORT OF THE CLAIM OF SOURCE OF INVESTMENT. EVEN THE ASSESSEE HAS ALSO FAILED TO PRODUCE THE LOAN CREDITORS TO BE EXAMINED BY THE ASSESSING OFFICER AND THOSE WHO WERE PRODUCED AND EXAMINED BY THE ASSESSING OFFICER COULD NOT PROVE THE CASE OF THE ASSESSEE. THEREFORE, WHATEVER EVIDENCE PRODUCED BY THE ASSESSEE DID NOT SUPPORT THE CASE OF THE ASSESSEE. HENCE, THE ASSESSEE FAILED TO PROVE THE CREDITWORTHINESS OF THE CREDITORS AND GENUINENESS OF THE TRANSACTION. THE ASSESSING OFFICER AFTER EXAMINATION OF THE CREDITORS HAVE GIVEN THE FINDINGS THAT THE CREDITWORTHINESS OF THE CREDITORS WERE NOT PROVED AND CONSEQUENTLY THE GENUINENESS OF THE TRANSACTION REMAINED UNPROVED. HE HAS RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW. 5. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS RELEVANT MATERIAL ON RECORD. THE ASSESSING OFFICER HAS REOPENED THE ASSESSMENT BY ISSUING THE NOTICE UNDER SECTION 148 BASED ON THE INFORMATION THAT THE ASSESSEE HAS PURCHASED THE IMMOVABLE PROPERTY WITHOUT EXPLAINED SOURCE OF INVESTMENT. THOUGH THE ASSESSING OFFICER HAS ASKED THE ASSESSEE TO PRODUCE THE SUPPORTING EVIDENCE AS WELL AS THE LOAN CREDITORS IN SUPPORT OF HIS CLAIM THAT THE INVESTMENT WAS MADE FROM TAKING LOANS FROM ITA NO.122/ALLD/2019 SRI AMIT KUMAR 5 HIS SISTER, FRIENDS AND RELATIVES HOWEVER, THE TIME PERIOD GRANTED BY THE ASSESSING OFFICER FOR PRODUCING THE ENTIRE DETAILS, THE DOCUMENTARY EVIDENCE AS WELL AS THE LOAN CREDITORS WAS ONLY A BRIEF PERIOD OF ABOUT 20 DAYS. 6. HAVING CONSIDERED THE FACTS AND CIRCUMSTANCES OF THE CASE, WHEN THE ASSESSEE WAS GIVEN ONLY ONE OPPORTUNITY TO PRODUCE ALL THE NECESSARY DETAILS, DOCUMENTARY EVIDENCE AND LOAN CREDITORS IN PERSON AS WELL AS IN VIEW OF THE FACT THAT THE CASE OF THE FATHER OF THE ASSESSEE WHO IS THE CO-OWNER OF THE SAME PROPERTY IS SET ASIDE BY THIS TRIBUNAL VIDE ORDER DATED 21.12.2017 IN ITA NO. 210/ALLD/2017 SRI. LUXMI CHAND VS. INCOME TAX OFFICER, WARD-11(2), ALLAHABAD TO THE RECORD OF THE CIT(A) FOR DECIDING THE SAME AFRESH, THE IMPUGNED ORDER OF THE CIT(A) IS SET ASIDE AND THE MATTER IS REMANDED BACK TO THE RECORD OF THE CIT(A) FOR FRESH ADJUDICATION ALONG WITH THE CO- OWNER AND IF NEED ARISES A REMAND REPORT MAY BE CALLED FOR IN RESPECT OF THE EVIDENCE TO BE PRODUCED BY THE ASSESSEE. NEEDLESS TO SAY THE ASSESSEE BE GIVEN AN OPPORTUNITY OF BEARING BEFORE PASSING A FRESH ORDER. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 04.08.2021 THROUGH VIDEO CONFERENCING. SD/- [VIJAY PAL RAO] JUDICIAL MEMBER DATED: 04/08/2021 SH COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) , ALLAHABAD 4. CIT 5. DR - BY ORDER ASSISTANT REGISTRAR .