SHRI BHARAT MITTAL, JAIPUR V. INCOME TAX OFFICER, WARD-3-5, JAIPUR

ITA 1318/JPR/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 4215 (ITAT-JAIPUR)
• Duration Of Justice: 5 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 27-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K C MEENA CIT DHK
• Assessee Lawyers: V K JAIN
• Keywords: Unexplained cash credit; Opportunity of being heard; Additional evidence
• Section: 143(3); 144

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES A, JAIPUR JH JES'K LH 'KEKZ] YS[KK LNL; ,OA JH FOT; IKY JKO] U;KF;D LNL; DS LE{K BEFORE: SHRI RAMESH C SHARMA, AM & SHRI VIJAY PAL RAO, JM VK;DJ VIHY LA -@ ITA NO. 1318/JP/2018 FU/KZKJ.K O'KZ@ ASSESSMENT YEAR : 2014-15 BHARAT MITTAL, 6/403, CHITRAKOOT, VAISHALI NAGAR, JAIPUR. CUKE VS. I.T.O., WARD-3(5) JAIPUR. LFKK;H YS[KK LA -@THVKBZVKJ LA-@ PAN/GIR NO.: AHVPM 8244 Q VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS @ ASSESSEE BY : SHRI V.K. JAIN (CA) JKTLO DH VKSJ LS @ REVENUE BY : SHRI K.C. MEENA (ADDL.CIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 08/05/2019 MN?KKS 'K.KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 10/05/2019 VKNS'K@ ORDER PER: R.C. SHARMA, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD.CIT(A)-I, JAIPUR DATED 28/09/2018 FOR THE A.Y. 2014-15 IN THE MATTER OF EX PARTE ORDER PASSED U/S 143(3) READ WITH SECTION 144 OF THE INCOME TAX ACT, 1961 (IN SHORT, THE ACT). 2. IN THIS APPEAL, THE ASSESSEE IS AGGRIEVED FOR THE EX PARTE ORDER PASSED BY THE A.O. WITHOUT GIVING DUE OPPORTUNITY AND FOR CONFIRMING THE ADDITION ON MERIT. ITA 1318/JP/2018_ BHARAT MITTAL VS. ITO 2 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED. WITH REGARD TO EX PARTE ORDER PASSED BY THE A.O., THE LD AR OF THE ASSESSEE HAS SUBMITTED AS UNDER: THE NOTICES DT. 29.04.2016, 16.06.2016 AND 02.12.2016 WERE NOT RECEIVED BY THE ASSESSEE. NOTICE SENT BY E-MAIL WAS NOT RECEIVED BY THE ASSESSEE AS THE AR OF THE ASSESSEE HAD PROBABLY GIVEN THE MAIL ID OF THE COMPANY WHICH IS UNDER LIQUIDATION AND NOT ACCESSIBLE TO THE ASSESSEE. THE FIRST NOTICE SHOW CAUSE NOTICE DT. 16.12.2016 WAS RECEIVED BY THE ASSESSEE ON 19.12.2016 FIXING THE DATE FOR 22.12.2016 AND REQUIRED THE ASSESSEE TO COMPLY WITH THE REQUIREMENTS OF NOTICE DT. 16.06.2016 BUT THE NOTICE DT. 16.06.2016 WAS NOT ANNEXED TO IT. THE ASSESSEE'S A.R. ATTENDED ON 22.12.2016 AND CASE WAS ADJOURNED TO 26.12.2016. ON 26.12.2016, THE A.O. GAVE COPIES OF NOTICE DT. 16.06.2016 AND 02.12.2016 AND ADJOURNED THE CASE TO 27.12.2016 GIVING ONLY ONE DAY TIME TO THE ASSESSEE TO SUBMIT HIS REPLY. THE ASSESSEE FILED THE REQUIRED DETAILS INCLUDING THE LEDGER COPY OF CASH CREDITORS. ADDRESS AND PAN OF THE CASH CREDITORS WERE ALREADY IN THE AUDIT REPORT. THE A.O. NEVER ASKED THE ASSESSEE TO EXPLAIN THE CREDITS IN HIS CAPITAL ACCOUNT EXCEPT AT THE TIME OF HEARING ON 27.12.2016 WHEN HE FOUND SUBSTANTIAL CREDITS IN CAPITAL ACCOUNT. HE SHOULD HAVE GIVEN OPPORTUNITY TO THE ASSESSEE TO EXPLAIN THE CREDITS IN THE CAPITAL ACCOUNT AS WELL AS ADDITIONAL REQUIREMENTS FROM CASH CREDITORS. HOWEVER, HE INSTEAD PROCEEDED TO FINALISE THE CASE WITHOUT GIVING OPPORTUNITY TO THE ASSESSEE TO PUT UP HIS CASE. THE ASSESSEE AGAIN APPEARED BEFORE THE A.O. ON 28.12.2016 ALONG WITH BOOKS OF ACCOUNTS AND ADDITIONAL PAPERS IN SUPPORT OF CASH CREDITS AND CAPITAL INTRODUCED BUT WAS RETURNED BACK BY THE A.O. SAYING THAT HE HAD ALREADY FRAMED THE ASSESSMENT. DUE TO PAUCITY OF TIME BETWEEN THE RECEIPT OF REQUIREMENTS OF THE A.O. AND FINAL HEARING, THE ASSESSEE WAS PREVENTED FROM PRODUCING EVIDENCES TO SUPPORT THE CREDITS IN THE ACCOUNT OF CASH CREDITORS. AFFIDAVIT OF ASSESSEE IS ENCLOSED. FURTHER THE ASSESSEE WAS NEVER ASKED TO ITA 1318/JP/2018_ BHARAT MITTAL VS. ITO 3 EXPLAIN THE CREDITS IN HIS CAPITAL ACCOUNT (FOR WHICH ADDITION OF RS. 61,50,000/- HAS BEEN MADE) EXCEPT AT THE TIME OF FINAL HEARING ON 27.12.2016. HENCE PROPER OPPORTUNITY WAS NOT GIVEN TO ASSESSSEE TO EXPLAIN THE CREDITS IN HIS CAPITAL ACCOUNT. 4. FROM THE RECORD, WE FOUND THAT BEFORE THE LD. CIT(A), THE ASSESSEE HAS FILED ADDITIONAL EVIDENCE IN SO FAR AS OPPORTUNITY WAS NOT GIVEN TO THE A.O., THE LD. CIT(A) SENT THE DOCUMENTS FOR REMAND REPORT UNDER RULE 46A OF THE INCOME TAX RULES, 1962 (IN SHORT THE RULES). HOWEVER, THE A.O. DECLINED TO ADMIT THE SAME ON THE PLEA THAT DUE OPPORTUNITY WAS GRANTED TO THE ASSESSEE BUT THE ASSESSEE DID NOT AVAIL THE SAME. 5. BY THE IMPUGNED ORDER, THE LD. CIT(A) CONFIRMED THE ADDITION BY OBSERVING THAT THE ADEQUATE OPPORTUNITY WAS PROVIDED TO THE ASSESSEE BY THE A.O. 6. WE HAVE CONSIDERED RIVAL CONTENTIONS AND CAREFULLY GONE THROUGH THE ORDERS OF AUTHORITIES BELOW AND FOUND THAT FIRST EFFECTIVE NOTICE WAS RECEIVED BY THE ASSESSEE FROM THE AO ON 19.12.2016 FIXING DATE A HEARING ON22.12.2016 WHICH WAS ADJOURNED TO 26.12.2016 IN WHICH THE ASSESSEE APPEARED ALONG WITH HIS A.R.COPY OF NOTICES U/S142(1) DT.16.08.2016 AND FINAL SHOW CAUSE DT.02.12.2016 WAS PROVIDED TO THE ASSESSEE AND ASSESSEE WAS ASKED TO FILE HIS REPLY ON THE NEXT DAY I.E. 27.12.2016. THE ASSESSEE FILED HIS REPLY ON 27.12.216 ENCLOSING THE DETAILS. HOWEVER, IN ITA 1318/JP/2018_ BHARAT MITTAL VS. ITO 4 RESPECT OF UNSECURED LOANS, THE ASSESSEE FILED COPY OF LEDGER ACCOUNT AND DETAILS INCLUDING PAN OF CASH CREDITORS. CONFIRMATIONS COULD NOT BE OBTAINED WITHIN THE LIMITED TIME OF 1 DAY PROVIDED. DURING THE ASSESSMENT PROCEEDINGS, ON THE LAST DATE I.E. 27.12.2016, DURING THE HEARING THE A.O. NOTICED LARGE CREDITS IN ASSESSEE'S CAPITAL ACCOUNT AND ASKED FOR SOURCE OF CAPITAL INTRODUCED. THE ASSESSEE EXPLAINED THAT ALL CREDITS ARE THROUGH ACCOUNT PAYEE CHEQUES AND DETAILED EXPLANATION REGARDING SOURCE CAN BE FURNISHED ONLY AFTER SEEING ALL PAPERS INCLUDING BANK ACCOUNTS. THUS THE ADDITION OF 61,50,000/- HAS BEEN MADE ON ACCOUNT OF UNEXPLAINED CREDITS IN CAPITAL ACCOUNT WITHOUT PROVIDING ANY OPPORTUNITY TO EXPLAIN THE SOURCE OF THE SAME. EXPLANATION WAS ASKED FOR THE FIRST-TIME DURING HEARING ON 27.12.2016 AND ORDER PASSED ON THE SAME DAY WITHOUT PROVIDING OPPORTUNITY TO THE ASSESSEE TO EXPLAIN THE SOURCE. ON THE SPOT EXPLANATION DURING HEARING REGARDING SOURCE OF DEPOSITS CANNOT BE SAID TO BE REASONABLE OPPORTUNITY. SIMILARLY, ONE DAY TIME FOR FILING CONFIRMATION OF CASH CREDITORS CANNOT BE SAID TO BE REASONABLE OPPORTUNITY. THEREFORE, IN THE SUBSTANTIAL INTEREST OF JUSTICE, WE RESTORE THE MATTER BACK TO THE FILE OF THE A.O. FOR DECIDING THE ISSUE AFRESH AFTER PROVIDING ADEQUATE AND REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE ASSESSEE IS ALSO DIRECTED TO APPEAR BEFORE THE A.O. WITHIN A PERIOD OF TWO MONTHS FROM THE DATE OF RECEIPT OF THIS ORDER. WE DIRECT ACCORDINGLY. ITA 1318/JP/2018_ BHARAT MITTAL VS. ITO 5 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES ONLY. ORDER PRONOUNCED IN THE OPEN COURT ON 10 TH MAY, 2019. SD/- SD/- FOT; IKY JKO JES'K LH 'KEKZ (VIJAY PAL RAO) (RAMESH C SHARMA) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 10 TH MAY, 2019 *RANJAN VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- SHRI BHARAT MITTAL, JAIPUR. 2. IZR;FKHZ @ THE RESPONDENT- THE I.T.O., WARD-3(5) JAIPUR. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 1318/JP/2018) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR