M/s Bagga Millenium Liquors (India) Pvt. Ltd., New Delhi V. DCIT, New Delhi

ITA 1410/DEL/2011

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 7460 (ITAT-DELHI)
• Duration Of Justice: 5 year(s) 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-06-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 01-06-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 18-03-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: K K JAISWAL
• Keywords: Principle of natural justice
• Section: 144

Judgement Text

1 ITA NO. 1410/DEL/2011 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: A NEW DELHI BEFORE SHRI J. SUDHAKAR REDDY, ACCOUNTANT MEM BER AND SMT SUCHITRA KAMBLE , JUDICIAL MEMBER I.T.A .NO. 1410/DEL/2011 (ASSESSM ENT YEAR-2007-08) BAGGA MILLENNIUM LICUORS (INDIA) PVT. LTD. VADS & CO. B-113, LAJPAT NAGAR-1 NEW DELHI AACCB6033B (APPELLANT) VS DCIT CIRCLE2(1) NEW DELHI (RESPONDENT) APPELLANT BY SH. P. C. YADAV, ADV RESPONDENT BY SH. K. K. JAISWAL, DR ORDER PER SUCHITRA KAMBLE, JM THIS APPEAL IS FILED AGAINST THE ORDER DATED 10/12/ 2010 PASSED BY CIT(A)-V, NEW DELHI, FOR ASSESSMENT YEAR 2007-08. 2. THE GROUNDS OF APPEAL ARE AS FOLLOWS: 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, TH E ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX, APPEALS-V, NEW DELHI IS ERRONEOUS, BOTH IN LAW AND ON THE FACTS. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX, APP EALS-V, NEW DELHI HAS ERRED ON FACTS AND IN LAW IN SUSTAINING T HE EX-PARTE ASSESSMENT ORDER U/S 144 OF THE INCOME TAX ACT, 196 1, BY TREATING INCREASE IN UNSECURED LOANS AS UNEXPLAINED CASH CRE DITS, WITHOUT DATE OF HEARING 01.06.2016 DATE OF PRONOUNCEMENT 10.06.2016 2 ITA NO. 1410/DEL/2011 CONSIDERING THE FACTS AND MATERIAL AVAILABLE ON REC ORD AND WITHOUT AFFORDING THE REASONABLE AND ADEQUATE OPPORTUNITY T O THE APPELLANT. 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX, APP EALS-V, NEW DELHI HAS ERRED ON FACTS AND IN LAW IN SUSTAINING A DDITION OF RS.8,31,31,839/- U/S 68 OF THE INCOME TAX ACT, 1961 , BY TREATING INCREASE IN UNSECURED LOANS AS UNEXPLAINED CASH CRE DITS, WITHOUT CONSIDERING THE FACTS AND MATERIALS AVAILABLE ON RE CORD AND WITHOUT AFFORDING THE REASONABLE AND ADEQUATE OPPORTUNITY T O THE APPELLANT. 4. THAT THE LEARNED COMMISSIONER OF INCOME TAX, APP EALS-V, NEW DELHI HAS ERRED ON FACTS AND IN LAW IN SUSTAINING A DDITION OF RS.1,30,137/- AS UNDISCLOSED INCOME ON THE BASIS OF AIR INFORMATION RECEIVED THROUGH INCOME TAX SYSTEM, WITHOUT CONSIDE RING THE FACTS AND MATERIALS AVAILABLE ON RECORD BY WAY OF INTERES T RECEIVED OF RS.1,00,934/- REFLECTED IN THE AUDITED PROFIT & LOS S ACCOUNT SUBMITTED TO THE LEARNED ASSESSING OFFICER AND WIT HOUT AFFORDING THE REASONABLE AND ADEQUATE OPPORTUNITY TO THE APPE LLANT BY WAY OF PROVIDING AIR INFORMATION RECEIVED THROUGH INCOME T AX SYSTEM AND SEEKING EXPLANATION FROM THE APPELLANT IN RESPECT O F DIFFERENCE IN INTEREST RECEIVED AS PER AIR INFORMATION RECEIVED T HROUGH INCOME TAX SYSTEM AND INTEREST RECEIVED AS PER AUDITED PRO FIT & LOSS ACCOUNT OF THE APPELLANT. 5. THAT THE LEARNED COMMISSIONER OF INCOME TAX, APP EALS-V, NEW DELHI HAS ERRED ON FACTS AND IN LAW IN SUSTAINING A DDITION OF RS.79,85,502/- BY DISALLOWING 20% OF EXPENDITURES C LAIMED WITHOUT CONSIDERING THE FACTS AND MATERIALS AVAILABLE ON RE CORD AND WITHOUT AFFORDING THE REASONABLE AND ADEQUATE OPPORTUNITY T O THE APPELLANT. 3. THE MAIN CONTENTION OF THE ASSESSEE WAS THAT THE ASSESSING OFFICER AS WELL AS THE CIT (A) HAS PASSED EX-PARTE ORDER. THE EXPLANATION GIVEN BY THE ASSESSEE IN THE STATEMENT OF FACT BEFORE THE CIT (A ) FOR NON-APPEARANCE WAS AS FOLLOWS:- 2. THAT THE LEARNED ASSESSING OFFICER HAS ERRED ON FACTS AND IN LAW IN PASSING THE EX-PARTE ASSESSMENT ORDER U/S 144 OF TH E INCOME TAX ACT, 1961, ON 17THE DECEMBER 2009, WITHOUT AFFORDING THE REASONABLE AND ADEQUATE OPPORTUNITY TO THE APPELLANT. THE LEARNED ASSESSING OFFICER WAS AWARE OF THE FACT THAT THE APPELLANT HAS SHIFTED IT S OFFICE FROM GURGAON TO HYDERABAD AND THE STATE OF ANDHRA PRADESH IN GENERA L AND CITY OF HYDERABAD IN PARTICULAR WERE PASSING THROUGH STATE OF TURMOIL FACING CLOSURE OF BUSINESS ACTIVITIES/CITY BANDH, WIDESPRE AD VIOLENCE, PROTESTS, 3 ITA NO. 1410/DEL/2011 AGITATIONS AND POLITICAL UNREST DUE TO DISPUTE OVER CREATION OF NEW TELANGANA STATE. IN THESE CIRCUMSTANCES, THE LEARN ED ASSESSING OFFICER HAS NOT AFFORDED REASONABLE AND ADEQUATE OPPORTUNIT Y TO THE APPELLANT THEREBY VIOLATING THE PRINCIPAL OF NATURAL JUSTICE AND EQUITY. 4. THE ASSESSEE FURTHER STATED THAT THE ASSESSEE CO ULD NOT APPEAR BEFORE THE CIT(A) AS HIS FATHER WAS SUFFERING FROM CANCER AND DIED ON 2013. THE ASSESSEE SUBMITTED THE MEDICAL REPORT AS WELL. IN THE INTER EST OF JUSTICE, IT WILL BE APPROPRIATE THAT THE ASSESSING OFFICER AFTER GIVING PROPER HEARING TO THE ASSESSEE DECIDE THE ISSUE AND MAKE AN ADDITION OR D ISALLOWANCE ACCORDINGLY AS PER THE LAW. THEREFORE, THE MATTER IS REMANDED BAC K TO THE ASSESSING OFFICER NEEDLESS TO SAY THE ASSESSEE MAY BE GIVEN PROPER HE ARING. 5. IN RESULT, THE APPEAL IS PARTLY ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 10TH OF JUNE, 2016. SD/- SD/- (J. SUDHAKAR REDDY) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEMB ER DATED: 10/06/2016 R. NAHEED * COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI 4 ITA NO. 1410/DEL/2011 DATE 1. DRAFT DICTATED ON 01/06/2016 PS 2. DRAFT PLACED BEFORE AUTHOR 02/06/2016 PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER .2016 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 10.06.2016 PS/PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK 10.06.2016 PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER.