Sh. Anil Thapar, Ludhiana V. ITO, W-7(1), Ludhiana

ITA 13/CHANDI/2019

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 6002 (ITAT-CHANDIGARH)
• Duration Of Justice: 6 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-08-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 25-07-2019
• Assessment Year: 2013-2014
• Appeal Filed On: 04-01-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Keywords: Depreciation; Opportunity of being heard; Peak credit; Set aside

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH, SMC, CHANDIGARH , BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER ./ ITA NO. 13/CHD/2019 / ASSESSMENT YEAR : 2013-14 SHRI ANIL THAPAR, PROP. M/S THAPARSONS CORPORATION, #129, ASHOK VIHAR, KVM COLONY, RISHI NAGAR, LUDHIANA VS. THE ITO, WARD 7 (1), LUDHIANA ./PAN NO: AAPPT6208G / APPELLANT /RESPONDENT ! /ASSESSEE BY : SHRI PARIKSHIT AGGARWAL, CA ' ! / REVENUE BY : SH. MANJIT SINGH, CIT DR # $ % /DATE OF HEARING : 25.07.2019 &'() % / DATE OF PRONOUNCEMENT : 01.08 .2019 / ORDER THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSESS EE AGAINST THE ORDER DATED 12.11.2018 OF THE COMMISSIONER OF INCO ME TAX (APPEALS)- 3, LUDHIANA [HEREINAFTER REFERRED TO AS CIT(A)] . 2. IN THIS APPEAL, THE ASSESSEE HAS TAKEN THE FOL LOWING GROUNDS OF APPEAL:- 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) -3, LUDHIANA HAS ERRED THE CONFIRMING THE ADDITION OF R S. 18,53,454/- MADE BY THE LD. ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED PEAK CREDIT OF AXIS BANK LIMITED ACCOUNT NO. 042010100139427 WITHOUT CONSIDERING THE FACTS O F THE ITA NO. 13CHD-2019- SHRI ANIL THAPAR, LUDHIANA 2 CASE, WITHOUT GIVING ANY PROPER OPPORTUNITY TO THE APPELLANT AND WITHOUT CONSIDERING THE SUBMISSIONS FILED BY TH E ASSESSEE DURING THE COURSE OF APPELLATE PROCEEDINGS AS WELL AS IN ASSESSMENT PROCEEDINGS. THEREFORE, ADDITION OF RS. 18,53,454/- MADE BY THE LEARNED ASSESSING OFFICER AND CONFIRMED BY THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS) -3, LUDHIANA IS ILLEGAL, UNWARRANTED, UNC ALLED FOR AND NEEDS TO BE DELETED. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) -3, LUDHIANA HAS ERRED THE CONFIRMING THE ADDITION OF RS. 5,82,545/- MADE BY THE LD. ASSESSING OFFICER ON AC COUNT OF DEPOSITS THROUGH TRANSFERS/CLEARINGS IN AXIS BANK LIMITED ACCOUNT NO. 042010100139427 WITHOUT CONSIDERING THE FACTS OF CASE, WITHOUT GIVING ANY PROPER OPPORTUNIT Y TO THE APPELLANT AND WITHOUT CONSIDERING THE SUBMISSIONS F ILED BY THE ASSESSEE DURING THE COURSE OF APPELLATE PROCEED INGS AS WELL AS IN ASSESSMENT! PROCEEDINGS. THEREFORE, ADDI TION OF RS. 5,82,545/- MADE BY THE LEARNED ASSESSING; OFFIC ER AND CONFIRMED BY THE LEARNED; COMMISSIONER OF INCOME TA X (APPEALS)-3, AND CONFIRMED BY THE LD. CIT(A) -3 LUD HIANA IS ILLEGAL, UNWARRANTED, UNCALLED FOR AND NEEDS TO BE DELETED. 3. THAT THE LEARNED COMMISSIONER OF INCOME TAXI (APPEA LS)-3, LUDHIANA HAS ERRED THE CONFIRMING; THE ADDITION OF RS. 36,567/- MADE BY THE LEARNED ASSESSING OFFICER ON A CCOUNT OF L/6TH DISALLOWANCE TOWARDS PERSONAL USE OF CAR E XPENSES, DEPRECIATION OF CAR, CAR INSURANCE; AND INTEREST ON CAR LOAN WITHOUT GIVING PROPER OPPORTUNITY TO THE APPEL LANT AND WITHOUT CONSIDERING THE FACTS OF THE CASE. THEREFOR E, ADDITION OF RS. 36,567/- MADE BY THE LEARNED ASSESSING OFFIC ER AND CONFIRMED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-3, LUDHIANA IS ILLEGAL, UNWARRANTED, UNCA LLED FOR AND NEEDS TO BE DELETED 4. GROUND NO.3 : AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT AS PER THE INSTRUCTIONS OF THE CLIEN T, HE DOES NOT PRESS ITA NO. 13CHD-2019- SHRI ANIL THAPAR, LUDHIANA 3 THIS GROUND OF APPEAL, HENCE, THE SAME IS DISMISSED AS NOT PRESSED. 5. GROUND NOS. 1 & 2 : VIDE GROUND NO.1 OF THE APPEAL, THE ASSESSEE HAS AGITATED THE CONFIRMATION OF ADDITION OF RS. 18,53,454/- OF THE PEAK CREDIT MADE BY THE ASSESSING OFFICER ON AC COUNT OF UNEXPLAINED DEPOSITS IN THE ACCOUNT OF THE ASSESSE E WITH AXIS BANK ACCOUNT BEARING NO.042010100139427, WHEREAS, VIDE G ROUND NO.2, THE ASSESSEE HAS AGITATED THE ACTION OF THE CIT(A) IN C ONFIRMING THE ADDITION OF RS. 5,82,545/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF DEPOSITS MADE THROUGH TRANSFER / CLEARING IN THE S AME BANK ACCOUNT. 6. THE MAIN GROUND ON THE BASIS OF WHICH THE ADDIT IONS HAS BEEN MADE IS THAT THE ASSESSEE ALLEGEDLY HAD CONCEALED T HIS BANK ACCOUNT FROM THE INCOME TAX AUTHORITIES AS HE DID NOT MENTI ON ABOUT THIS ACCOUNT IN THE RETURN OF INCOME. ON THE OTHER HAND, THE PL EA OF THE ASSESSEE HAS BEEN THAT THE DEPOSITS IN THE BANK ACCOUNT WERE OUT OF DISCLOSED SOURCE OF INCOME. THAT THE ASSESSEE COULD RECONCILE THE DE POSITS WITH THE EXPLAINED SOURCES / CASH FLOW STATEMENT. THE LD. CO UNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE IDENTICAL ISSUE IN THE EARLIER ASSESSMENT YEAR 2012-13, WHEREIN, THE IDENTICAL ADDITIONS WERE MADE ON ACCOUNT OF DEPOSITS IN THE SAME BANK ACCOUNT, HAS BEEN RESTOR ED BY THE TRIBUNAL TO THE FILE OF THE ASSESSING OFFICER VIDE DATED 19. 12.2018 PASSED IN ITA NO. 344/CHD/2018. THE CONCLUDING PART OF THE ORDER OF THE COORDINATE BENCH OF THE TRIBUNAL IS REPRODUCED AS UNDER:- ITA NO. 13CHD-2019- SHRI ANIL THAPAR, LUDHIANA 4 7. A PERUSAL OF THE ABOVE SHOWS THAT CIT(A) HAS DE CIDED THE ISSUE AGAINST THE ASSESSEE RELYING UPON THE OBS ERVATIONS OF THE AO THAT THE DOCUMENTARY EVIDENCE DOES NOT SUPPO RT THE FACT THAT IN 2011-12 ASSESSMENT YEAR EVEN THOUGH TH E ORDER WAS PASSED U/S 143, THE SAID BANK ACCOUNT HAD BEEN CONSIDERED. THE AUTHORITIES HAVE NOT ADDRESSED AS TO WHAT KIND OF EVIDENCE WOULD SATISFY THE DEPARTMENT IN TH E PECULIAR KIND OF CASE FOR THE ASSESSEE TO SUCCESSFULLY DEMON STRATE ITS CLAIM. THE RECORDING OF THE BANK ACCOUNT IN THE SC RUTINY ORDERS ARE NOT IN THE HANDS OF THE ASSESSEE. THE A SSESSEE AT BEST CAN ATTEMPT TO CO-RELATE THE DEPOSITS WITH A C ASH FLOW STATEMENT RELATING TO HIS BUSINESS ACTIVITIES. A P ERUSAL OF THE ABOVE ORDER FURTHER SHOWS THAT THE CIT(A) HAS NOTED THAT THE BUSINESS OF THE ASSESSEE IS IN HOSIERY GOODS WHEREAS A PERUSAL OF THE ASSESSMENT ORDER SHOWS THAT THE ASSESSEE IS TRADING IN HERBALS, HING AND SAFFRON. ACCORDINGLY, IT IS EVIDENT THAT NOT ONLY THE ASSESSMENT ORDER IS PASSED IN HASTE, EVEN THE IMPUGNED ORDER APPEARS TO HAVE BEEN PASSED ON SOME CONFUSION. IN THE COURSE OF THE HEARING, LD. AR WA S REQUIRED TO ADDRESS AS TO WHETHER THE ASSESSEE HAS STARTED ITS BUSINESS IN THE LAST 2 TO 3 YEARS OR HAS HE BEEN IN BUSINESS FO R A LONGER TIME. THE LD. AR HAS STATED THAT THE ASSESSEE HAS BEEN RETURNING INCOME FROM THE SAID ACTIVITIES FOR THE L AST MORE THAN 10 YEARS. 8. ACCORDINGLY, CONSIDERING THE PECULIAR FACTS AND CIRCUMSTANCES OF THE PRESENT CASE FOR THE REASONS S ET OUT HEREIN ABOVE, THE IMPUGNED ORDER IS SET ASIDE BACK TO THE FILE OF THE AO WITH DIRECTION TO CONSIDER THE CASH-FLOW STATEMENT WHICH IS AVAILABLE IN VOLUME-II OF THE PAPER BOOK A ND PASS A SPEAKING ORDER IN ACCORDANCE WITH LAW AFTER GIVING THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD. S AID ORDER WAS PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEA RING ITSELF. 9. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 7. SINCE THE FINDINGS ARRIVED IN THE EARLIER ASSES SMENT YEAR IN SET ASIDE PROCEEDINGS WILL ALSO HAVE BEARING IN THIS CA SE IN RESPECT OF THE ITA NO. 13CHD-2019- SHRI ANIL THAPAR, LUDHIANA 5 ADDITIONS MADE TO THE INCOME OF THE ASSESSEE FOR T HE ASSESSMENT YEAR UNDER CONSIDERATION, HENCE, IT WILL BE APPROPRIATE THAT THE ISSUE FOR THE ASSESSMENT YEAR UNDER CONSIDERATION IS ALSO RESTORE D TO THE FILE OF THE ASSESSING OFFICER TO BE DECIDED FOLLOWING IDENTICA L LINES AS DIRECTED BY THE COORDINATE BENCH OF THE TRIBUNAL VIDE ORDER DA TED 19.12.2018 (SUPRA). THE ISSUE RAISED VIDE GROUND NOS.1 & 2 IS, ACCORD INGLY RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR FRESH ADJUDIC ATION IN ACCORDANCE WITH LAW. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TREA TED AS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 01.08.2019. SD/- ( / SANJAY GARG) / JUDICIAL MEMBER DATED : 01.08 .2019 .. ', -. /. / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. # 0 / CIT 4. # 0 ( )/ THE CIT(A) 5. .12 3 , % 3 , 45627 / DR, ITAT, CHANDIGARH 6. 26 8$ / GUARD FILE ', # / BY ORDER, 9 ' / ASSISTANT REGISTRAR