Gulab Maruti Dhakunde, Pune V. Deputy Commissioner of Income-tax, Central Circle -2 (2), Pune

ITA 1237/PUN/2019

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 7577 (ITAT-PUNE)
• Duration Of Justice: 2 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-10-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 14-08-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRAVIN CHAVAN
• Keywords: Principle of natural justice
• Section: 143(3); 142(1); 143(2); 148; 2

Judgement Text

] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC, PUNE BEFORE SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER . / ITA NO.1237/PUN/2019 / ASSESSMENT YEAR : 2011-12 SHRI GULAB MARUTI DHAKUNDE, S.NO.171/5, SEEMA PARK, BANERGAON, PUNE 411045, PAN : AAXPD0500D . / APPELLANT V/S THE DY.COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 2(2), PUNE. . / RESPONDENT ASSESSEE BY : NONE. REVENUE BY : SHRI PRAVIN CHAVAN. / ORDER PER ANIL CHATURVEDI, AM : 1. THIS APPEAL FILED BY THE ASSESSEE IS EMANATING OUT OF THE ORDER OF COMMISSIONER OF INCOME TAX (A) 12, PUNE DATED 19.06.2019 FOR THE ASSESSMENT YEAR 2011-12. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON R ECORD ARE AS UNDER :- ASSESSEE IS AN INDIVIDUAL AND STATED TO BE ENGAGED IN TH E BUSINESS OF BRICKS MANUFACTURING. ASSESSEE FILED HIS RETURN OF INCOME FOR A.Y. 2011-12 ON 27.07.2011 DECLARING TOTAL INCOME AT RS.4,30,432/-. SUBSEQUENTLY, THE CASE WAS RE-OPENED BY ISSUING / DATE OF HEARING : 09.10.2019 / DATE OF PRONOUNCEMENT: 25.10.2019 2 NOTICE U/S 148 OF THE ACT. THEREAFTER, NOTICES U/S 143(2) AND 142(1) OF THE ACT WERE ISSUED TO THE ASSESSEE ON 19.11.20 18. IN RESPONSE TO NOTICE U/S 148 OF THE ACT, ASSESSEE FILED HIS RETURN OF INCOME ON 17.11.2018 DECLARING THE TOTAL INCOME AT RS.4,30,42 3/-. THE CASE WAS TAKEN UP FOR SCRUTINY AND THEREAFTER, ASSE SSMENT WAS FRAMED U/S 143(3) R.W.S. 147 OF THE ACT VIDE ORDER DT.19.1 2.2018 AND THE TOTAL INCOME WAS DETERMINED AT RS.10,01,923/-. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATT ER BEFORE LD.CIT(A), WHO VIDE ORDER DT.19.06.2019 (IN APPEAL NO.PN/CIT(A )- 12/10335/2018-19) DISMISSED THE APPEAL OF ASSESSEE. AGGR IEVED BY THE ORDER OF LD.CIT(A), ASSESSEE IS NOW IN APPEAL AND H AS AND RAISED THE FOLLOWING GROUNDS : 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW , THE LD. CIT(APPEAL)-12, PUNE ERRED IN PASSING THE A PPELLATE ORDER DISMISSING THE APPEAL WITHOUT AFFORDING SUFFICIENT AND REASONABLE OPPORTUNITY OF HEARING AS THE FOUR NOTIC ES MENTIONED IN PARA 3.1 OF THE APPELLATE ORDER AS ISSUED FOR HE ARING ON 19/03/2019, 5 / 0412019, 24/04/2019 AND 1210612019 , IN ALL, HAD NOT BEEN RECEIVED BY THE APPELLANT AND THE GROUNDS RAISED IN THE APPEAL BEFORE THE LD. CIT(A) WERE NOT ADJUDICATED O N MERIT IN THE SAID APPELLATE ORDER. THE APPEAL ORDER SO PASSED BY THE LD. CIT(A) WITHOUT GIVING SUFFICIENT OPPORTUNITY AND SO ALSO WITHOUT CONSIDERING THE GROUNDS RAISED IN MERIT , BEING ARBITRARY, ILLEGAL AND BAD IN LAW BE QUASHED. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD. CIT(A) , ERRED IN DISMISSING THE APPEAL OF THE APPELLANT WITHOUT CONSIDER I NG AND APPRECIATING THE FACTS AS DETAILED IN THE STATEMENT OF FACTS AND WITHOUT APPRECIATING THE FAC TS THAT THE LD . ASSESSING OFFICER HAD ERRED IN REOPENING THE CASE U /S 147 OF THE IT ACT , 1961 AND ISSUING NOTICE U/S 148 OF THE SAID ACT WITHOUT RECORDING PROPER REASONS OF INCOME WHICH HAD ESCAPE D ASSESSMENT UNDER THE SAID PROVISIONS , SO THAT AN ASSESSMENT ORDER COULD BE PASSED LEGALLY U/S 143(3) R.W.S . 147 OF THE ACT. THE APPELLATE ORDER SO PASSED WITHOUT CONSIDERING T HE REOPENING OF THE CASE WRONGLY BY THE ASSESSING OFFICER RESORTING TO ACTION U/S 147 / 148 OF THE ACT BEING ILLEGAL AND BAD IN LAW B E QUASHED. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW , THE LD. CIT(A) ERRED IN PASSING THE APPELLATE ORDER WIT HOUT CONSIDERING AND DISCUSSING HIS SAY IN RESPECT OF REOPENING OF T HE CASE BY THE ASSESSING OFFICER U/S 147 OF THE I T ACT , 196 1 AND ISSUING NOTICE U/S 148 OF THE SAID ACT ON CERTAIN FACTS WERE IN PASSIN G OF THE 3 ASSESSMENT ORDER U/S 143(3) R . W.S.147 OF THE ACT ON A SEPARATE SET OF FACTS FOR WHICH THE CASE WAS NOT REOPENED RENDER ING SUCH ORDERS BOTH BY THE LD. CIT(A) AND ASSESSING OFFICER ARBITRARY , ILLEGAL AND BAD IN LAW AND , THEREFORE, SUCH ORDER BE QUASHED. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW , THE LD . CIT(A) ERRED IN DISMISSING THE APPEAL WITHOUT AFFOR DING SUFFICIENT AND REASONABLE OPPORTUNITY OF HEARING AND CONFIRMIN G THE ADDITION MADE BY THE ASSESSING OFFICER OF RS. 5 , 71 , 500/- IGNORING THE FACTS THAT THE SAME WERE THE DEPOSITS MADE BY THE APPELLA NT IN THE VISHVESHWAR CO-OPERATIVE BANK , OUT OF THE SALE PROCEEDS OF THE ASSESSEE'S BRICK MANUFACTURING BUSINESS AND ALSO PE RSONAL SERVICE AND WITHOUT APPRECIATING THE FACTS THAT THE LD. ASS ESSING OFFICER MADE SUCH ADDITIONS WITHOUT MAKING ANY VERIFICATION OR CALLING FOR DETAILS AND HAD DECIDED ADVERSELY AGAINS T THE APPELLANT IN VIOLATION OF PRINCIPLE OF NATURAL JUSTICE , WHEN ALL SUCH DETAILS EVIDENCES PERTAINING TO SUCH SOURCES OF DEPOSITS COULD BE EXP LAINED BY THE APPELLANT BEFORE BOTH THE AUTHORITIES. THE APPELLAT E ORDER SO PASSED DISMISSING THE APPEAL AND IN TURN CONFIRMING THE AD DITION BEING ARBITRARY , ILLEGAL AND BAD IN LAW BE QUASHED. 3. ON THE DATE OF HEARING, NONE APPEARED ON BEHALF OF THE ASSESSEE NOR ANY ADJOURNMENT APPLICATION WAS FILED. I THER EFORE PROCEED TO DISPOSE OF THE APPEAL EX-PARTE QUA THE ASSE SSEE BASED ON THE MATERIAL AVAILABLE ON RECORD AND AFTER HEARING THE LD.D.R. 4. GROUND NOS. 1 TO 3 ARE WITH RESPECT TO THE RE-OPENIN G OF ASSESSMENT PROCEEDINGS AND GROUND NO.4 IS WITH RESPECT TO ADDITION ON ACCOUNT OF UNEXPLAINED DEPOSITS. 4.1. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, ON VERIFICATION OF DETAILS OF SAVING BANK ACCOUNT OF ASSESSEE MAINTAINED WITH VISHVESHWAR CO-OPERATIVE BANK, BANER ROAD BRANCH, PUNE, AO NOTICED CASH DEPOSITS ON DIFFERENT DATES AGGREGATING TO RS.5,71,500/-. THE ASSESSEE WAS ASKED T O FURNISH THE INFORMATION WITH RESPECT TO THE SOURCE OF CASH DEPOS ITS IN THE BANK ACCOUNT DURING THE YEAR UNDER CONSIDERATION, TO W HICH ASSESSEE SUBMITTED THAT HE EARNED PROFITS FROM HIS BRICK 4 MANUFACTURING BUSINESS BUT FAILED TO FURNISH TO PROVE THE SAME BY FURNISHING DOCUMENTARY EVIDENCE. HENCE, THE AO TREATED THE SAME AS UNEXPLAINED AND ACCORDINGLY MADE AN ADDITION OF RS.5,71,500/- TO THE TOTAL INCOME OF THE ASSESSEE. AG GRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE LD.C IT(A), WHO UPHELD THE ORDER OF AO. AGGRIEVED BY THE ORDER OF LD.CIT(A), ASSESSEE IS NOW IN APPEAL. 5. I HAVE HEARD THE LD.D.R. AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN GROUNDS 1 TO 3 ARE WITH RESPECT TO THE RE -OPENING OF ASSESSMENT PROCEEDINGS U/S 143(3) R.W.S 147 OF THE ACT AND GROUND NO.4 IS WITH RESPECT TO THE THE ADDITION OF RS.5,71 ,500/- ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS IN THE BANK ACC OUNT OF ASSESSEE. THE PERUSAL OF THE ASSESSMENT ORDER REVEALS THAT NO DETAILS WERE FILED BY THE ASSESSEE BEFORE AO AND THEREFO RE HE CONSIDERED THE ENTIRE CASH DEPOSITS AS UNEXPLAINED AND M ADE ITS ADDITION. THE ORDER OF LD.CIT(A) REVEALS THAT LD.CIT(A) HAS P ASSED AN EX-PARTE ORDER WITHOUT DECIDING THE ISSUE ON MERITS. IT IS A SETTLED LAW THAT LD.CIT(A) HAS NO JURISDICTION TO DISMISS T HE APPEAL OF THE ASSESSEE WITHOUT GOING INTO THE MERITS OF THE ISSUE BEFORE HIM. EVEN IN AN EX-PARTE ORDER, THE LD.CIT(A) SHOULD HAV E DECIDED THE GROUNDS OF APPEAL OF THE ASSESSEE ON MERITS THEREOF. CONSIDERING THE AFORESAID FACTS, I AM OF THE VIEW THAT IN T HE INTERESTS OF JUSTICE AND FAIR PLAY, THE ASSESSEE BE GIVEN ONE MORE OPPORTUNITY TO PRESENT HIS CASE BEFORE LD.CIT(A). I THERE FORE REMIT THE ISSUE BACK TO LD.CIT(A) TO DECIDE THE ISSUE ON MERITS IN 5 ACCORDANCE WITH LAW. NEEDLESS TO STATE THAT LD.CIT(A) SHA LL GRANT ADEQUATE OPPORTUNITY OF HEARING TO BOTH THE PARTIES. IN VIEW OF MY DECISION TO RESTORE THE ISSUE TO LD.CIT(A), I AM NOT ADJUD ICATING ON MERITS THE GROUNDS OF THE APPEAL RAISED BY THE ASSESSEE. THUS, THE GROUNDS OF ASSESSEE ARE ALLOWED FOR STATISTICAL PUR POSES. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 25 TH DAY OF OCTOBER, 2019. SD /- ( ANIL CHATURVEDI ) ' / ACCOUNTANT MEMBER PUNE; DATED : 25 TH OCTOBER, 2019. YAMINI #$%&'(' % / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. 4. 5 6. CIT(A)-1, NASHIK. PR. CIT-1, NASHIK. '#$ %%&',) &', *+ / DR, ITAT, SMC PUNE; $-.// GUARD FILE. / BY ORDER // TRUE COPY // 012%3&4 / SR. PRIVATE SECRETARY ) &', / ITAT, PUNE.