Smt Leeladevi Devendrakumar Doshi alias jain , Hubli V. The Income TAX Officer Ward-3(2), Hubli

ITA 1284/BANG/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 7691 (ITAT-BANGALORE)
• Duration Of Justice: 2 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-07-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 19-04-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S VENKATESH
• Keywords: Opportunity of being heard; Condonation of delay
• Section: 234B; 201(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC-B BENCH : BANGALORE BEFORE SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER ITA NO. 1 284 / BANG/201 8 ASSESSMENT YEAR : 20 08 - 09 SMT. LEELADEVI DEVENDRAKUMAR DOSHI ALIAS JAIN, PROP: SHA S MOHANLAL & CO., 1 ST FLOOR, RAMACHANDRA PLAZA, DAJIBHAPET, HUBLI. PAN: AAYPC4123E VS. THE INCOME TAX OFFICER, WARD 3 (2), HUBLI. APPELLANT RESPONDENT APPELLANT BY : SMT. PRATIBHA R, ADVOCATE RESPONDENT BY : SHRI S. VENKATESH, JCIT (DR) DATE OF HEARING : 0 4 .0 7 .2018 DATE OF PRONOUNCEMENT : 13 .0 7 .2018 O R D E R PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER THIS APPEAL IS FILED BY THE ASSESSEE WHICH IS DIREC TED AGAINST THE ORDER OF LD. CIT (A), HUBLI DATED 03.07.2017 FOR ASSESSMENT YEAR 2008-09. 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER. 1. THE LEARNED CIT (A) ERRED IN PASSING THE ORDER I N THE MANNER WHICH HE DID. 2. THE LEARNED CIT (A) ERRED IN CONFIRMING THE ADDI TION OF RS. 7,20,630/- WITH REGARD TO INTEREST PAYMENTS. 3. THE LEARNED CIT(A) OUGHT TO HAVE APPRECIATED THA T THE INTEREST PAYMENTS TO DEPOSITORS AND FORM 15G WAS FILED BEFOR E THE AO, WITHOUT APPRECIATING THE SAME THE AO HAS MADE ADDITION. THE ADDITION CONFIRMED BY CIT(A)WITHOUT CONSIDERING THE SUBMISSI ON OF APPELLANT IS BAD IN LAW. 4. THE LD. CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS. 1,32,789 TOWARDS A DIFFERENCE BETWEEN THE AMOUNT DECLARED IN THE BALANCE SHEET AND CONFIRMATION LETTERS WITHOUT APPRECIATING THE SUBMISSION OF ITA NO.1284/BANG/2018 PAGE 2 OF 6 THE APPELLANT. 5. THE ID. CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS. 50,499/- WITHOUT CONSIDERING THE SUBMISSION OF THE APPELLANT . 6. THE ID. CIT(A) ERRED IN CONFIRMING THE ADDITION MADE OF RS. 40,000/-TOWARDS ON ACCOUNT OF LOW DRAWING. 7. THE LEARNED CIT (A) ERRED IN LEVYING THE INTERES T U/S 234B 86 234C OF THE ACT. 8. WITHOUT PREJUDICE, THE DISALLOWANCES/ADDITIONS A S CONFIRMED BY THE LEARNED CIT(A) ARE ARBITRARY, EXCESSIVE AND OUGHT T O BE DELETED IN TOTO. 9. THE LEARNED CIT(A) ERRED IN CONFIRMING THE LEVY OF INTEREST UNDER SECTIONS 234B, 234C AND 234D OF THE ACT. 10. FOR THESE AND SUCH OTHER GROUNDS THAT MAY BE UR GED AT THE TIME OF HEARING, THE APPELLANT PRAYS THAT THE APPEAL MAY BE ALLOWED. 3. IT WAS SUBMITTED BY LD. AR OF ASSESSEE THAT THIS APPEAL IS FILED AFTER A DELAY OF 166 DAYS. THE ASSESSEE HAS FURNISHED AN APPLICATIO N FOR CONDONATION OF DELAY ALONG WITH AN AFFIDAVIT IN WHICH IT IS STATED THAT THE ASSESSEES MOTHER-IN-LAW WAS UNDER MEDICAL TREATMENT FROM 22.08.2017 AND THE REAFTER, AT HER WISH, SHE WAS TAKEN TO HER NATIVE PLACE AT BALOTRA, RAJASTHAN AND ULTIMATELY AFTER PROLONGED SICKNESS, SHE EXPIRED ON 24.02.2018 AND A SSESSEE WAS THE ONLY PERSON THE LOOK AFTER HER MOTHER-IN-LAW AND THEREFO RE, SHE COULD NOT CONCENTRATE ON TAX MATTERS AND THIS RESULTED IN DEL AY IN FILING APPEAL BEFORE THE TRIBUNAL. CONSIDERING THESE FACTS THE DELAY IS CON DONED. 4. THE LD. AR OF ASSESSEE SUBMITTED THAT GROUND NO. 1 IS GENERAL AND REGARDING GROUND NOS. 2 AND 3, SHE SUBMITTED THAT IN PARA 8 O N PAGE NO. 4 OF THE ORDER OF CIT (A), IT IS NOTED THAT IT WAS SUBMITTED BY LD. A R OF ASSESSEE BEFORE HIM THAT FORM 15G WAS FILED BEFORE CIT, HUBLI ON 27.10.2008 AND SINCE, THESE FORMS WERE NOT FILED WITHIN THE STIPULATED PERIOD, THE SA ME WERE NOT CONSIDERED BY THE AO AS VALID AND HE DECIDED THE ISSUE AGAINST THE AS SESSEE. SHE SUBMITTED A COPY OF TRIBUNAL ORDER RENDERED IN THE CASE OF THE KARUR VYSYA BANK LTD. VS. ACIT IN ITA NO. 1854/BANG/2016 DATED 09.08.2017 AND DRAWN MY ATTENTION TO PARA 9 OF THIS TRIBUNAL ORDER AND IT WAS POINTED OU T THAT IN THAT CASE ALSO, FORM ITA NO.1284/BANG/2018 PAGE 3 OF 6 15G AND 15H WERE NOT SUBMITTED BEFORE THE JURISDICT IONAL CIT WITHIN THE TIME AND THEREFORE, DEMAND WAS RAISED BY THE AO U/S. 201 (1) AND 201(1A) BUT THE MATTER WAS RESTORED BACK TO THE FILE OF AO FOR FRES H DECISION WITH THE DIRECTION THAT THESE FORMS SHOULD BE EXAMINED BY THE AO AND I F THE SAID FORMS ARE FOUND TO BE CORRECT ON VERIFICATION, IT CANNOT BE HELD TH AT THE ASSESSEE WAS IN DEFAULT AND NO DEMAND SHOULD BE RAISED U/S. 201(1) AND 201( 1A) OF IT ACT. SHE SUBMITTED THAT IN THE PRESENT CASE ALSO, THE MATTER SHOULD BE RESTORED BACK TO THE FILE OF AO FOR FRESH DECISION. THE LD. DR OF R EVENUE SUPPORTED THE ORDERS OF AUTHORITIES BELOW. 5. I HAVE CONSIDERED THE RIVAL SUBMISSIONS. FIRST OF ALL, I REPRODUCE PARA 9 OF THE TRIBUNAL ORDER ON WHICH RELIANCE HAS BEEN PLACED BY LD. AR OF ASSESSEE AS NOTED ABOVE. THE SAID PARA READS AS UNDER. 9. TURNING TO THE FACTS OF THE CASE, WE FIND THAT U NDISPUTEDLY ASSESSEEHAS SUBMITTED THE FORMS 15G/15H BEFORE THE AO, BUT IT WAS NOT CONSIDERED ON ACCOUNT OF ITS NON-SUBMISSION IN TIME BEFORE THE JURISDICTIONAL CIT AND THE AO PASSED AN ORDER U/S. 201(1) & 201(1A) OF THE ACT RAISING A DEMAND THEREIN. THE ASSESSEE A GAIN FILED THE SAID FORMS BEFORE THE CIT(APPEALS), BUT HE DID NOT TAKE COGNIZANCE OF THE SAME AND CONFIRMED THE ORDER OF AO. SINCE THE ASSES SEE HAS FILED THE FORMS 15G/15H ON ACCOUNT OF WHICH TDSWAS NOT DEDUCT ED, THE LOWER AUTHORITIES SHOULD HAVE EXAMINED THE SAME. SINCE TH E ASSESSEE HAS ALREADY FILED THE FORMS 15G/15H BEFORE THE LOWER AU THORITIES, WE ARE OF THE VIEW THAT THE SAID FORMS BE EXAMINED BY THE AO AND IF THE SAID FORMS ARE FOUND TO BE CORRECT ON VERIFICATION, THE ASSESSEE CANNOT BE HELD TO BE IN DEFAULT AND NO DEMAND SHOULD BE RAISE D U/S. 201(1) & 201(1A) OF THE ACT. OTHERWISE, THE AO MAY ACT IN AC CORDANCE WITH THE LAW. ACCORDINGLY, THE ORDER OF CIT(APPEALS) IS SET ASIDE AND THE MATTER IS RESTORED TO THE FILE OF ASSESSING OFFICER TO READJUDICATE THE ISSUE AFRESH IN THE TERMS INDICATED ABOVE, AFTER AF FORDING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 6. FROM THE ABOVE PARA REPRODUCED FROM THE TRIBUNAL ORDER CITED BY LD. AR OF ASSESSEE, IT IS SEEN THAT IN THAT CASE ALSO, COPY O F FORM 15G AND 15H WERE NOT FILED WITH THE JURISDICTIONAL CIT WITHIN TIME AND D EMAND WAS RAISED BY THE AO U/S. 201(1) AND 201(1A). THE TRIBUNAL RESTORED THE MATTER BACK TO THE FILE OF AO FOR FRESH DECISION WITH THE DIRECTION THAT IF TH E SAID FORMS ARE FOUND TO BE CORRECT ON VERIFICATION, IT CANNOT BE SAID THAT THE ASSESSEE IS IN DEFAULT AND NO DEMAND CAN BE RAISED U/S. 201(1) AND 201(1A) OF IT ACT. IN THE PRESENT CASE ITA NO.1284/BANG/2018 PAGE 4 OF 6 ALSO, THIS IS THE FINDING OF CIT(A) THAT RELEVANT F ORM 15G WERE NOT FILED BEFORE THE JURISDICTIONAL CIT WITHIN TIME AND THEREFORE, T HE AO HAS INVOKED THE PROVISIONS OF SECTION 40(A)(IA) AND MADE DISALLOWAN CE BECAUSE PAYMENT OF EXPENDITURE WAS MADE BY THE ASSESSEE WITHOUT DEDUCT ION OF TDS. I FEEL IT PROPER TO RESTORE THE MATTER BACK TO THE FILE OF AO FOR FRESH DECISION WITH THE SAME DIRECTIONS AS WERE GIVEN BY THE TRIBUNAL IN TH E CASE OF THE KARUR VYSYA BANK LTD. VS. ACIT (SUPRA) CITED BY LD. AR OF ASSES SEE BEFORE ME AS PER PARA 9 OF THAT TRIBUNAL ORDER REPRODUCED ABOVE AND IF IT IS FOUND THAT FORM 15G ARE CORRECT ON VERIFICATION, THEN IT CANNOT BE SAID THA T ASSESSEE WAS REQUIRED TO DEDUCT TDS AND AS A CONSEQUENCE, NO DISALLOWANCE CA N BE MADE U/S. 40(A)(IA) OF IT ACT. THE AO SHOULD PASS NECESSARY ORDER AS PER LAW AND AS PER ABOVE DISCUSSION AFTER PROVIDING REASONABLE OPPORTU NITY OF BEING HEARD TO THE ASSESSEE. GROUND NOS. 2 AND 3 ARE ALLOWED FOR STAT ISTICAL PURPOSES. 7. REGARDING GROUND NO. 4, IT WAS SUBMITTED BY LD. AR OF ASSESSEE THAT THIS ISSUE WAS DECIDED BY CIT(A) AS PER PARAS 10 TO 12 OF HIS ORDER. HENCE THESE PARAS ARE REPRODUCED HEREINBELOW FOR THE SAKE OF READY RE FERENCE. 10. THE EIGHTH GROUND OF APPEAL RELATES TO THE ASSE SSING OFFICER MAKING AN ADDITION OF RS.1,32,789/- TOWARDS UNRECON CILED DIFFERENCE AMOUNT IN RESPECT OF SUNDRY TRADE CREDITS. THE ASSE SSING OFFICER, FOUND THE FOLLOWING DISCREPANCIES. : DHANASREE FABRICS LTD RS. 707/- SAMARTH SILK MILLS RS. 468/- MAHALAXMI POLY COT RS. 5,300/- VARUN SILK MILLS RS 307/- JTM TEXTILE INDUSTRIES RS. 15,990/- YUNICORN SYNTHETICS MILLS (P) LTD. RS. 27,635/- M ASHOK & CO. RS. 10,340/- INDERSILKMILLS RS 38,838/- VALENTINE CREATIONS RS. 33,204/- TOTAL RS.1,32,789/- 11. THE AUTHORIZED REPRESENTATIVE WAS ASKED TO EXPL AIN THE DIFFERENCE NOTICED WITH PROPER DOCUMENTARY EVIDENCES. HOWEVER, HE WAS UNABLE TO RECONCILE THE DIFFERENCE. IN VIEW OF THE ABOVE, THE DIFFERENTIAL AMOUNT OF RS.132,789/- WAS TREATED AS INCOME OF THE ASSESSEE AND BROUGHT TO TAX ACCORDINGLY. 12. THE ASSESSEE HAS NOT SUBMITTED ANY WRITTEN SUBM ISSION ON THIS GROUND OF APPEAL, NOR HAS THE ASSESSEE FURNISHED AN Y DETAILS TO SHOW THAT, THERE WAS NO DISCREPANCY. THE GROUND IS THERE FORE, DISMISSED AND ADDITION SUSTAINED. ITA NO.1284/BANG/2018 PAGE 5 OF 6 8. IT WAS SUBMITTED BY LD. AR OF ASSESSEE THAT IN T HE INTEREST OF JUSTICE, IF ONE MORE OPPORTUNITY IS PROVIDED TO THE ASSESSEE, THE ASSESS EE WILL SUBMIT THE RECONCILIATION OR SHE WILL SUBMIT THIS DETAIL AS TO WHETHER THE DIFFERENCE IN CREDIT IS FOR THE PRESENT YEAR OR AN EARLIER YEAR. I FEEL IT PROPER TO RESTORE THE MATTER BACK TO THE FILE OF AO FOR FRESH DECISION BECAUSE T HIS FINDING HAS TO BE GIVEN THAT THE DIFFERENCE IN THE AMOUNT OF CREDITORS IS P ERTAINING TO PRESENT YEAR OR AN EARLIER YEAR AND IF IT IS FOUND THAT SUCH DIFFERENC E IS NOT PERTAINING TO PRESENT YEAR, THEN NO ADDITION CAN BE MADE IN THE PRESENT Y EAR. HENCE I SET ASIDE THE ORDER OF CIT (A) ON THIS ISSUE ALSO AND RESTORE THE MATTER BACK TO THE FILE OF AO FOR FRESH DECISION IN THE LIGHT OF ABOVE DISCUSSION AFTER PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO ASSESSEE. ACCORDINGL Y GROUND NO. 4 IS ALLOWED FOR STATISTICAL PURPOSES. 9. REGARDING GROUND NOS. 5 AND 6, IT WAS SUBMITTED BY LD. AR OF ASSESSEE THAT THESE TWO ISSUES ARE DECIDED BY CIT(A) AS PER PARAS 13 TO 16 OF HIS ORDER. SHE SUBMITTED THAT REGARDING THE DIFFERENCE IN UNSECURE D LOAN ALSO, THE MATTER MAY BE RESTORED BACK TO THE FILE OF AO FOR FRESH DECISI ON BECAUSE IT HAS TO BE LOOKED INTO AS TO WHETHER THE DIFFERENCE IS FOR THE PRESEN T YEAR OR EARLIER YEAR. REGARDING THE ADDITION MADE BY THE AO ON ACCOUNT OF LOAN DRAWINGS ALSO, SHE SUBMITTED THAT IF THE MATTER IS RESTORED BACK TO TH E FILE OF AO FOR FRESH DECISION, THE ASSESSEE WILL BRING ON RECORD THE DRAWINGS OF O THER FAMILY MEMBERS TO ESTABLISH THAT THE DRAWINGS SHOWN BY THE ASSESSEE A ND BY OTHER FAMILY MEMBERS IS NOT INADEQUATE. THE LD. DR OF REVENUE S UPPORTED THE ORDERS OF AUTHORITIES BELOW. 10. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND I F IND FORCE IN THE SUBMISSION OF LD. AR OF ASSESSEE AND THEREFORE, I SET ASIDE THE ORDER OF CIT(A) ON BOTH OF THESE ISSUES AND RESTORE BOTH THESE MATTERS TO THE FILE O F AO FOR FRESH DECISION WITH THE DIRECTION THAT REGARDING ADDITION OF RS. 50,499 /- IN RESPECT OF UNRECONCILED DIFFERENCE IN RESPECT OF UNSECURED LOANS, IT HAS TO BE LOOKED INTO AS TO WHETHER SUCH DIFFERENCE IS PERTAINING TO PRESENT YEAR OR AN EARLIER YEAR BECAUSE IF THE DIFFERENCE IS NOT PERTAINING TO PRESENT YEAR THEN N O ADDITION CAN BE MADE IN THE PRESENT YEAR. THE ASSESSEE SHOULD BRING ON RECORD EVIDENCE IN THIS REGARD AND ITA NO.1284/BANG/2018 PAGE 6 OF 6 THEREAFTER, THE AO SHOULD DECIDE THE MATTER AFRESH AND PASS NECESSARY ORDER AS PER LAW AFTER PROVIDING REASONABLE OPPORTUNITY O F BEING HEARD TO ASSESSEE. REGARDING THE ISSUE OF RS. 40,000/- TOWARDS LOW DRA WINGS, THE ASSESSEE SHOULD BRING ON RECORD THE DRAWINGS SHOWN BY OTHER FAMILY MEMBERS ALONG WITH THE DETAILS OF FAMILY MEMBERS AND THEREAFTER, THIS ASPE CT SHOULD BE DECIDED AS TO WHETHER THE DRAWINGS SHOWN BY ASSESSEE IS ADEQUATE OR NOT. THE AO SHOULD PASS NECESSARY ORDER AS PER LAW ON THIS ISSUE AS PE R ABOVE DISCUSSION AFTER PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO AS SESSEE. IN THIS MANNER, BOTH THE GROUND NOS. 5 AND 6 ARE ALLOWED FOR STATIS TICAL PURPOSES. 11. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENT IONED ON THE CAPTION PAGE. SD/- (ARUN KUMAR GARODIA) ACCOUNTANT MEMBER BANGALORE, DATED, THE 13 TH JULY, 2018. /MS/ COPY TO: 1. APPELLANT 4. CIT(A) 2. RESPONDENT 5. DR, ITAT, BANGALORE 3. CIT 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.