Shri A.Krishnamoorthy, Coimbatore V. ITO, Coimbatore

ITA 1376/CHNY/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 64408 (ITAT-CHENNAI)
• Duration Of Justice: 3 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-10-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 17-10-2012
• Assessment Year: 2008-2009
• Appeal Filed On: 21-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: T BANUSEKAR
• Keywords: Income from undisclosed sources; Reasonable cause
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI VIKAS AWASTHY, JUDICIAL MEMBER I.T.A. NO. 1376/MDS/2012 (ASSESSMENT YEAR : 2008-09) SHRI A. KRISHNAMOORTHY, 266E, 2 ND FLOOR, 2 ND STREET, GANDHIPURAM, COIMBATORE 641 012. PAN : ADGPA8004B (APPELLANT) V. THE INCOME TAX OFFICER, WARD II(1), COIMBATORE. (RESPONDENT) APPELLANT BY : SHRI T. BANUSEKAR, CA RESPONDENT BY : SHRI GURU BASHYAM, JCIT DATE OF HEARING : 17.10.2012 DATE OF PRONOUNCEMENT : 17.10.2012 O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER : IN THIS APPEAL FILED BY THE ASSESSEE, HIS GRIEVAN CE IS THAT CIT(APPEALS) UPHELD AN ADDITION OF ` 17,10,000/- MADE BY THE ASSESSING OFFICER, FOR DEPOSITS MADE IN HIS S.B. A/C WITH HSB C BANK. 2. FACTS APROPOS ARE THAT ASSESSEE HAD FILED HIS RE TURN FOR IMPUGNED ASSESSMENT YEAR, DECLARING AN INCOME OF ` 1,67,149/-. THE RETURN WAS 2 I.T.A. NO. 1376/MDS/12 TAKEN UP FOR SCRUTINY AND NOTICE UNDER SECTION 143( 2) OF INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT') WAS SERVED ON THE ASSESSE E ON 7.9.2009. IT SEEMS DESPITE VARIOUS POSTINGS FOR HEARING, ASSESSE E DID NOT APPEAR. AS PER THE ASSESSING OFFICER, NO ADJOURNMENT PETITI ONS WERE ALSO FILED. A NOTICE WAS FINALLY ISSUED ON 4.10.2010 PROPOSING COMPLETION OF ASSESSMENT EX-PARTE. IN SUCH NOTICE, IT WAS BROUGH T TO THE NOTICE OF THE ASSESSEE THAT THERE WERE CASH DEPOSITS DURING THE F INANCIAL YEAR 2007- 08 IN AN S.B. A/C MAINTAINED BY HIM WITH HSBC BANK. HOWEVER, STILL NO REPLY CAME FROM THE ASSESSEE. ASSESSING OFFICER TH EREFORE CONSIDERED THE TOTAL DEPOSITS OF ` 17,10,000/- IN THE SAID S.B. A/C OF THE ASSESSEE, DURING THE RELEVANT PREVIOUS YEAR, AS UNACCOUNTED I NCOME OF THE ASSESSEE FROM UNDISCLOSED SOURCES. ASSESSMENT WAS COMPLETED UNDER SECTION 144 OF THE ACT. 3. ASSESSEE MOVED IN APPEAL BEFORE CIT(APPEALS) ALB EIT WITH A DELAY OF 145 DAYS. PLEADING OF ASSESSEE WAS THAT DUE TO ILL HEALTH, HE COULD NOT APPEAR. CONSIDERING THE EXPLANATION OF THE ASS ESSEE, CIT(APPEALS) CONDONED THE DELAY AND ADMITTED THE APPEAL. SUBMIS SION OF THE ASSESSEE BEFORE THE CIT(APPEALS) WAS THAT HE HAD RA ISED LOANS BASED ON PROMISSORY NOTES, WHICH COULD EXPLAIN THE DEPOSI TS MADE IN HSBC BANK. HOWEVER, CIT(APPEALS) WAS OF THE OPINION THA T ASSESSEE HAD NOT CO-OPERATED DURING THE ASSESSMENT PROCEEDINGS AND H E COULD NOT 3 I.T.A. NO. 1376/MDS/12 EXPLAIN WHY DETAILS OF THE SOURCE COULD NOT BE PROD UCED BEFORE THE A.O. ACCORDING TO HIM, THERE WAS NO REASONABLE CAUSE SHO WN BY THE ASSESSEE WHICH PREVENTED HIM FROM FILING THE EVIDEN CE BEFORE THE ASSESSING OFFICER. IN THIS VIEW OF THE MATTER, HE CONFIRMED THE ORDER PASSED BY THE A.O. 4. NOW BEFORE US, LEARNED A.R., STRONGLY ASSAILING THE ORDERS OF AUTHORITIES BELOW, SUBMITTED THAT ASSESSEE WAS SUFF ERING FROM RENAL FAILURE AND WAS UNABLE TO ATTEND TO HIS REGULAR BUS INESS DURING THE PERIOD OF ASSESSMENT. IT WAS DUE TO THIS REASON, A SSESSEE COULD NOT APPEAR BEFORE THE ASSESSING OFFICER AND THIS WAS BR OUGHT TO THE NOTICE OF THE ASSESSING OFFICER. AS PER THE LEARNED A.R., ASSESSEE WAS HAVING SOURCE FOR THE DEPOSITS MADE IN S.B. A/C MAINTAINED WITH HSBC BANK AND, IF GIVEN A CHANCE, HE COULD HAVE PRODUCED SUFF ICIENT EVIDENCE FOR PROVING THIS SOURCE. LEARNED A.R. SUBMITTED THAT I T WOULD BE UNFAIR TO PENALIZE A PERSON WHO COULD NOT APPEAR BEFORE ASSES SING OFFICER DUE TO ILL HEALTH. 5. PER CONTRA, LEARNED D.R. SUBMITTED THAT DESPITE VARIOUS OPPORTUNITIES GIVEN, ASSESSEE WAS TOTALLY NON-COOPE RATIVE AND NEVER APPEARED BEFORE ASSESSING OFFICER. THEREFORE, ACCO RDING TO HIM, NO LENIENCY COULD BE SHOWN TO THE ASSESSEE AT ALL. 4 I.T.A. NO. 1376/MDS/12 6. WE HAVE PERUSED THE ORDERS AND HEARD THE RIVAL SUBMISSIONS. IN THE FIRST PLACE, WE FIND THAT ASSESSEE HAD NEVER AP PEARED BEFORE THE ASSESSING OFFICER AT ALL. THE REASON FOR FAILURE M ENTIONED BY LEARNED D.R. COULD HAVE BEEN ACCEPTED IF THE ASSESSEE HAD A PPEARED ONCE AND FAILED TO APPEAR IN FURTHER PROCEEDINGS. THIS IS N OT THE CASE HERE. FURTHER, WE NOTE THAT CIT(APPEALS) CONDONED THE DEL AY IN FILING THE APPEAL BEFORE HIM BASED ON A FINDING THAT ASSESSEE WAS SUFFERING FROM SICKNESS. ONCE IT IS ACCEPTED THAT ASSESSEE WAS SU FFERING FROM SICKNESS AND IT IS CONSIDERED AS A GROUND SUFFICIENT ENOUGH FOR CONDONING DELAY IN FILING AN APPEAL, WE WONDER HOW THE CIT(APPEALS) FO UND THAT IT WOULD NOT BE SUFFICIENT ENOUGH FOR ASSESSEE NOT ENTERING APPE ARANCE BEFORE THE A.O. IF THE ASSESSEE WAS HAVING SOURCE WHICH HE CO ULD EXPLAIN FULLY OR PARTLY THE DEPOSITS MADE IN HSBC BANK, IT WILL BE G ROSS INJUSTICE TO TAX SUCH AMOUNTS AS UNACCOUNTED INCOME FROM UNDISCLOSED SOURCE. 7. IN THE FITNESS OF THE THINGS, WE ARE OF THE OPIN ION THAT THE MATTER REQUIRES A RE-VISIT BY THE A.O. WE, THEREFORE, SET ASIDE THE ORDERS OF AUTHORITIES BELOW AND REMIT THE PROCEEDINGS BACK TO THE FILE OF THE A.O. FOR CONSIDERATION AFRESH, IN ACCORDANCE WITH LAW. A.O. SHALL GIVE SUFFICIENT OPPORTUNITY TO THE ASSESSEE FOR PRESENTI NG HIS CASE. 8. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS A LLOWED FOR STATISTICAL PURPOSES. 5 I.T.A. NO. 1376/MDS/12 THE ORDER WAS PRONOUNCED IN THE COURT ON WEDNESDAY, THE 17 TH OF OCTOBER, 2012, AT CHENNAI. SD/- SD/- (VIKAS AWASTHY) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 17 TH OCTOBER, 2012. KRI. COPY TO: (1) APPELLANT (2) RESPONDENT (3) CIT(A)-I, COIMBATORE (4) CIT-I, COIMBATORE (5) D.R. (6) GUARD FILE