Shri Ashokumar Laxminarayan Dave, Ahmedabad V. The Income tax Officer,Ward-11(3), Ahmedabad

ITA 1341/AHD/2011

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 0498 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 10 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-03-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 23-01-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 05-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D K SINGH
• Keywords: Principle of natural justice; Additional evidence
• Section: 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD , , BEFORE SHRI MUKUL KR.SHRAWAT, JUDICIAL MEMBER AND SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER ./ I.T.A. NO.1341/AHD/2011 ( / ASSESSMENT YEAR : 2007-08) SHRI ASHOKKUMAR LAXMINARAYAN DAVE PROP.M/S.RAMKRISHNA MARBLE D/403, SHANTINIKETAN, R-TAX COMPOUND NR.BAPUNAGAR, AHMEDABAD / VS. THE INCOME TAX OFFICER WARD-11(3) AHMEDABAD ' ./#$ ./ PAN/GIR NO. : ACLPD 7505 Q ( '% / APPELLANT ) .. ( &''% / RESPONDENT ) '% ( / APPELLANT BY : SHRI TUSHAR HEMANI &''% ) ( / RESPONDENT BY : SHRI D.K.SINGH, SR.D.R. * ) / DATE OF HEARING : 24/1/2013 +,-. ) / DATE OF PRONOUNCEMENT : 15/03/2013 / / O R D E R PER SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER : THIS IS AN APPEAL FILED BY THE ASSESSEE ARISING F ROM THE ORDER OF LD.CIT(A)-XVI, AHMEDABAD DATED 30/03/2011 PASSED FOR A.Y.2007-08 AND THE GROUNDS RAISED ARE AS FOLLOWS:- 1. LD.CIT(A) HAS ERRED IN LAW IN CONFIRMING THE ACT OF AO IN FRAMING ASSESSMENT BY INVOKING THE PROVISIONS OF SE CTION 143(3) R.W.S. 144 OF THE ACT WHICH IS BAD IN LAW AN D LD.CIT(A) OUGHT TO HAVE QUASHED THE SAME SINCE THES E ITA NO.1341/AHD /2011 SHRI ASHOKKUMAR LAXMINARAYAN DAVE VS. ITO ASST.YEAR - 2007-08 - 2 - PROVISIONS HAVE NO APPLICABILITY TO THE FACTS OF TH E CASE OF THE APPELLANT. IN ANY CASE THE SAID PROVISIONS ARE NOT APPLIED WITHOUT JURISDICTION AND AGAINST THE SCHEME OF THE ACT. 2. THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS OF THE CASE BY CONFIRMING THE ACTION OF LD.AO IN MAKING ADDITION O F RS.61,71,996/- ON ACCOUNT OF UNEXPLAINED CASH CREDI T U/S.68 OF THE ACT MERELY ON THE BASIS OF ASSESSMENT ORDER AND NOT CONSIDERING THE PAPERS SUBMITTED DURING THE COURSE OF HEARING. 3. THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS OF THE CASE BY CONFIRMING THE ACTION OF LD.AO IN MAKING ADDITION O F RS.15,25,686/- ON ACCOUNT OF ESTIMATION OF NET PROF IT @ 8% ON GROSS SALES MERELY ON THE BASIS OF ASSESSMENT OR DER AND NOT CONSIDERING THE PAPERS SUBMITTED DURING THE COU RSE OF HEARING. 4. THE LD.CIT(A) HAS ERRED IN LAW AND ON THE FACTS OF THE CASE IN NOT ACCEPTING THE ADDITIONAL EVIDENCES FURNISHED BY THE APPELLANT AS PER RULE 46A OF THE INCOME-TAX RULES, 1962, WHICH IS GROSSLY VIOLATION OF THE PROVISIONS OF THE ACT. 2. AN ORDER WAS PASSED U/S.144 OF IT ACT DATED 31/ 12/2009. AGAINST THE INCOME DECLARED OF RS.1,59,090/- THE AO HAD ASS ESSED THE INCOME AT RS.79,08,680/-. BEING AGGRIEVED, THE MATTER WAS CA RRIED BEFORE THE FIRST APPELLATE AUTHORITY WHO HAS UPHELD THE ACTION OF TH E AO. AN IMPORTANT FEATURE AS NOTICED BY US IS THAT THE ASSESSEE WAS D ENIED THE OPPORTUNITY TO PRODUCE THE ADDITIONAL EVIDENCE AT THE STAGE OF FIR ST APPEAL. IN THIS REGARD, RELEVANT OBSERVATION OF THE LD.CIT(A) IS WO RTH REPRODUCTION. 2.3.3 DURING THE APPELLATE PROCEEDINGS AT THE TIM E WHEN THE SUBMISSION WAS GIVEN BY THE APPELLANT, THE APPELLAN T HAD PROMISED THAT HE WOULD PRODUCE THE PARTIES FROM WHOM THE UNS ECURED LOANS WERE TAKEN DURING THE COURSE OF YEAR FOR EXAMINATIO N AS THEY WERE THE WITNESS OF THE ASSESSEE. THE APPELLANT WAS TOL D THAT DURING THE ASSESSMENT PROCEEDINGS THE APPELLANT HAD NOT CO-OPE RATED & HENCE HE MUST NOW PRODUCE THE CREDITORS HIMSELF. H E AGREED TO DO SO. IT WAS POINTED OUT TO THE AO IN THE LETTER DAT ED 08/12/2010 THAT ITA NO.1341/AHD /2011 SHRI ASHOKKUMAR LAXMINARAYAN DAVE VS. ITO ASST.YEAR - 2007-08 - 3 - THE ASSESSEE HAD AGREED FOR PRODUCING THESE CREDITO RS BEFORE HIM FOR EXAMINATION. THE AO WAS ASKED TO GIVE REMAND R EPORT. THE REMAND REPORT OF THE AO HAS BEEN RECEIVED VIDE LETT ER DATED 07/02/2011. IN THE REMAND REPORT, THE AO HAS STATED THAT THE ASSESSEE IS NOT ENTITLED TO PRODUCE THE ADDITIONAL EVIDENCE AT HIS STAGE BECAUSE ENOUGH OPPORTUNITY WAS GIVEN TO HIM D URING THE COURSE OF ASSESSMENT PROCEEDINGS. IN THIS REGARD, THE AO HAS RELIED ON THE DECISION OF HONORABLE GUJARAT HIGH CO URT IN THE CASE OF N B SURALI FAMILY TRUST 288 ITR 523 WHEREIN THE HONORABLE GUJARAT HIGH COURT STATED THAT THE ASSESS EE HAS NOT DISCHARGE ITS PRIMARY ONUS AND THEREFORE HE SHOULD NOT BE PERMITTED TO UNDERTAKE TO DISCHARGE THE SAME AT THE BELATED STAGE. THE AO ALSO RELIED ON THE DECISION OF HONOURABLE SU PREME COURT IN THE CASE OF GURJARGRAVURES 111 ITR 1. 2.1. FINALLY, THE LD.CIT(A) HAS AFFIRMED THE ADDITI ON AS FOLLOWS:- 2.4.1 I HAVE CONSIDERED THE SUBMISSION OF THE APP ELLANT AND OBSERVATION OF THE A.O. THE APP HAS CONSISTENTLY FAILED TO FOLLOW THE NOTICES ISSUED BY THE AO. AT THE REQUEST OF TH E APPELLANT A REMAND REPORT WAS SOUGHT FROM THE AO BUT THE APPELL ANT HAS FAILED TO PRODUCE THE PARTIES BEFORE THE AO ALSO. THEREFORE, IN VIEW OF THE DECISION OF HONORABLE GUJARAT HIGH COUR T & SUPREME COURT RELIED UPON BY THE AO ABOVE, I AGREE WITH THE AO THAT THE ADDITIONAL EVIDENCE SHOULD NOT BE ADMITTED . FURTHER, SINCE THE APPELLANT HAS FAILED TO PRODUCE THE PARTI ES AND SHOW THE BOOKS OF ACCOUNTS, THE SUBMISSION MADE BY THE APPEL LANT CANNOT BE RELIED UPON. THEREFORE, IT WOULD BE IN THE FITN ESS OF THING IF THE ENTIRE SUNDRY CREDITORS ADDITION IS CONFIRMED B ECAUSE SIMPLY STATING THAT THE SECURED LOAN IS FROM BANK C C LIMI T IS NOT ENOUGH. THE ASSESSEE IS REQUIRED TO PRODUCE THE BA NK STATEMENT COPY AND BOOKS OF ACCOUNTS TO VERIFY THE SAME. SIM PLY A STATEMENT MADE BY THE ASSESSEE THAT THERE ARE OLD L OANS IS NOT ENOUGH. THE ASSESSEE IS REQUIRED TO PRODUCE THE BO OKS OF ACCOUNTS AND LEDGER ACCOUNT OF THESE PARTIES TO SHO W THAT THESE ARE OLD LOANS AND THAT THEY WERE DECLARED IN THE EA RLIER YEARS. A COPY OF THE REMAND REPORT WAS GIVEN TO THE APPELLAN T FOR COMMENTS. MR. CP SHAH, CHARTERED ACCOUNTANT WHO AT TENDED AND STATED THAT HE HAS NO FURTHER SUBMISSION TO MAK E BECAUSE THE ITA NO.1341/AHD /2011 SHRI ASHOKKUMAR LAXMINARAYAN DAVE VS. ITO ASST.YEAR - 2007-08 - 4 - ASSESSEE WAS NOT COOPERATING. IN THE ABSENCE OF THE DETAILS, THE ENTIRE ADDITION OF CASH CREDIT OF RS.61,71,996 IS C ONFIRMED. 3. WITH THIS BACKBROUND, LD.AR MR.TUSHAR HEMANI HAS VEHEMENTLY PLEADED THAT THERE WAS A CLEAR-CUT INFRINGEMENT OF THE PROVISIONS OF RULE 46A BECAUSE THE ASSESSEE WAS NOT GRANTED DUE OPPOR TUNITY TO PRODUCE THE ADDITIONAL EVIDENCE BEFORE THE FIRST APPELLATE AUTHORITY. ON ONE HAND, AN EX-PARTE ORDER U/S.144 WAS PASSED BY THE AO AND ON THE OTHE R HAND, LD.CIT(A) HAS ALSO NOT GRANTED AN OPPORTUNITY TO PL ACE ON RECORD THE REQUISITE INFORMATION IN SUPPORT OF THE CORRECTNES S OF THE RETURN FILED. FROM THE SIDE OF THE REVENUE, LD.SR.DR MR.D.K.SINGH HAS PLEADED THAT THE FAILURE WAS ON THE PART OF THE ASSESSEE AND HE REMAINED NON- COOPERATIVE WITH THE REVENUE AUTHORITIES, THEREFORE NOT ENTITLED FOR ANY RELIEF. 4. HAVING HEARD THE SUBMISSIONS OF BOTH THE SIDES, WE ARE OF THE CONSIDERED VIEW THAT NATURAL JUSTICE DEMANDS TO PRO VIDE A REASONABLE AS ALSO AN ADEQUATE OPPORTUNITY OF HEARING TO A TAX-PA YER. ALTHOUGH AN EX-PARTE ORDER WAS PASSED U/S.144 WHICH REFLECTS THE LACKADA ISICAL BEHAVIOUR OF THE ASSESSEE BUT STILL FOR THE SAKE OF NATURAL JUSTICE, WE DEEM IT JUSTIFIABLE TO SEND THIS ISSUE BACK TO THE STAGE OF THE AO TO ASSESS THE INCOME AFRESH AS PER LAW, NEEDLESS TO SAY AFTER PRO VIDING ADEQUATE OPPORTUNITY OF HEARING TO THE ASSESSEE. SIDE BY SI DE, WE HEREBY STRICTLY DIRECT THIS ASSESSEE TO CO-OPERATE WITH THE REVENUE AUTHORITIES BY PLACING ON RECORD THE REQUISITE INFORMATION AS ALSO THE BOO KS OF ACCOUNTS WITHIN 30 DAYS ON RECEIPT OF ORDER OF THIS TRIBUNAL SUO MOTU WITHOUT WAITING ANY NOTICE OF HEARING. SINCE WE HAVE RESTORED THE ISSU E BACK TO THE STAGE OF ITA NO.1341/AHD /2011 SHRI ASHOKKUMAR LAXMINARAYAN DAVE VS. ITO ASST.YEAR - 2007-08 - 5 - THE AO TO BE DECIDED DE NOVO AFRESH AS PER LAW, HENCE REST OF THE GROUNDS MAY BE TREATED AS ADJUDICATED UPON FOR STATISTICAL PURPOSES. 5. IN THE RESULT, ASSESSEES APPEAL IS DEEMED AS ALL OWED FOR STATISTICAL PURPOSES ONLY. SD/- SD/- ( ) ( ) ( ANIL CHATURVEDI ) ( M UKUL KR. SHRAWAT ) ACCOUNTANT MEMBER JU DICIAL MEMBER AHMEDABAD; DATED 15/ 03 /2013 3.., .../ T.C. NAIR, SR. PS !'#$ %$' / COPY OF THE ORDER FORWARDED TO : 1. '% / THE APPELLANT 2. &''% / THE RESPONDENT. 3. 456 7 / CONCERNED CIT 4. 7 () / THE CIT(A)-XVI, AHMEDABAD 5. :;< &56, 56., =4 / DR, ITAT, AHMEDABAD 6. <>? @* / GUARD FILE. & / BY ORDER, ': & //TRUE COPY// '/ () ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION DATED 13.3.13 (DICTATION-PAD 5 PAGES ATTACHED) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 13.3.13 OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S15.3.13 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 15.3.13 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 9. DATE OF DESPATCH OF THE ORDER