Shri Ganga Lahiri Prop., Meerut V. ITO, Hapur

ITA 136/DEL/2017

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 3538 (ITAT-DELHI)
• Duration Of Justice: 3 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-04-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 17-04-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 09-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BEDOBANI CHAUDHURI
• Assessee Lawyers: V K GOEL
• Section: 40A(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH SMC NEW DELHI BEFORE SHRI B.P. JAIN, ACCOUNTANT MEMBER ITA NO.136/DEL/2017 ASSESSMENT YEAR 2010-11 SHRI GANGA LAHIRI PROP. M/S. GANGA CONSTRUCTIONS, NAKKA KUAN, GARH MUKTESHWAR, DIST- HAPUR PAN: ADFPL 4013L VS. ITO, WARD-1, HAPUR. (APPELLANT) (RESPONDENT) ASSESSEE(S) BY : SHRI V.K. GOEL, ADV REVENUE BY : MS. BEDOBANI CHAUDHURI, SR.D.R. / DATE OF HEARING : 17/04/2017 / DATE OF PRONOUNCEMENT: 18/04/2017 ORDER THIS APPEAL OF THE ASSESSEE ARISES FROM THE ORDER O F LEARNED CIT(A),GHAZIABAD DATED 28.11.2016 FOR THE ASSESSMEN T YEAR 2010-11. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL. 1. THAT THE A.O . AS WELL AS CIT(A) , GHAZIABAD ARE IN ERROR THAT AUDIT OBJECT I ON CAN BE SAID TO BE REASON TO BELIEF OF A.O. AND ASSESSMENT CAN BE MADE ON THE SOLE BASIS OF AUDIT PARTY OBJECTION . HENCE, REOPENING OF THE ASSESSMENT IS BAD IN LAW. 2. THAT THE A.O . WAS NOT JUSTIFIED IN MAKING ADDITION OF RS . 15 , 72,163/- ON TECHNICAL REASON AS THE FACTS HAVE ALREADY BEEN DISCLOSED BY THE ASSESSEE. HENCE, REOPENING OF CASE AND DISALLOWANCE U/S 40A(3) ARE BAD IN LAW. 3. THAT LD. CIT(A) WAS NOT JUSTIFIED IN SIMP L Y START I NG THAT THE VARIOUS CASE LAWS QUOTED BY THE ASSESSEE ARE NOT APPL I CABLE. 4. THAT PENALTY PROCEEDING U/S 271(1)[C] ARE BAD IN LA W AS ALL THE MATERIAL FACTS WERE DISCLOSED BY THE ASSESSEE. 5. THAT THE ASSESSEE HAS RIGHT TO ADD/DELETE OR MODIFY ANY GROUNDS DURING THE APPEAL PROCEEDING . ITA NO.136/DEL/2017 2 3. THE BRIEF FACTS OF THE CASE ARE THAT THE AO OBSE RVED THAT THE CASH PAYMENTS MORE THAN RS.20,000/- WERE MADE BY TH E ASSESSEE TO TWO CREDITORS AND ACCORDINGLY INITIATED PROCEEDINGS U/S.147 OF THE ACT. THE PROCEEDINGS WERE INITIATED ON THE BASIS OF THE OBSERVATION MADE BY THE AUDIT PARTY AND THE LEARNED CIT(A) ACCO RDINGLY BY GIVING THE REASONS IN HIS ORDER DISMISSED THE LEGAL GROUNDS OF THE ASSESSEE. 4. I HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. IT IS A FACT ON RECORD THAT THE AO HAS REOPEN ED THE ASSESSMENT ON THE BASIS OF THE OBSERVATION OF THE AUDIT PARTY AND HAS NOT APPLIED HIS INDEPENDENT MIND IN THIS REGARD. LEARNED COUNSE L FOR THE ASSESSEE RELIED UPON THE DECISION OF HONBLE BOMBAY HIGH COU RT IN THE CASE OF IL & FS INVESTMENT MANAGEMENT LTD., REPORTED IN (2008) 298 ITR 32 (BOM) AND ALSO UPON THE DECISION OF HONBLE SUPR EME COURT IN THE CASE OF INDIAN EXPRESS NEWSPAPER SOCIETY VS. CI T, REPORTED IN 2 TAXMAN 197 (SC) WHEREIN IT HAS BEEN HELD THAT ANY R EOPENING OF THE ASSESSMENT ON THE BASIS OF THE OBSERVATION OF THE A UDIT PARTY IS NOT SUFFICIENT TO INITIATE RE-ASSESSMENT PROCEEDINGS U/ S.147/148 OF THE ACT. IN THE CIRCUMSTANCES AND FACTS OF THE CASE AND THE DECISION OF VARIOUS COURTS OF LAW IN THIS REGARD, I AM OF THE V IEW THAT ASSESSMENT SO MADE IS DIRECTED TO BE QUASHED. THUS, THE APPEAL OF THE ASSESSEE ON THE LEGAL GROUND IS ALLOWED. ITA NO.136/DEL/2017 3 5. SINCE THE ASSESSEE SUCCEEDS ON LEGAL GROUND, THE REFORE, THE GROUNDS ON MERIT ARE OF ACADEMIC IN NATURE WHICH DO NOT REQUIRE ANY ADJUDICATION. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY 18 TH APRIL, 2017 SD/- (B.P. JAIN) ACCOUNTANT MEMBER DATED: 18/04/2017 PRABHAT KUMAR KESARWANI, SR.P.S. COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(APPEALS) 5.DR: ITAT ASSTT. REGISTRAR, ITAT, NEW DELHI