Ramisetty Ravi Kumar, Vijayawada V. The Income Tax Officer, Ward-1(1), Vijayawada

ITA 142/VIZ/2019

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 2534 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 2 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-06-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: misc
• Appeal Filed On: 27-03-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: D K SONOWAL
• Keywords: Unexplained cash credit; Additional evidence
• Section: 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . . , BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH , ACCOUNTANT MEMBER . / I . T .A.NO. 14 2 /VIZ/2019 ( / ASSESSMENT YEAR : 20 13 - 14 ) RAMISETTY RAVI KUMAR D.NO.11 - 6 - 36, ABDULAZEEM STREET ISLAMPET VIJAYAWADA [PAN : A HCPR4297D ] VS. INCOME TAX OFFICER WARD - 1(1) VIJAYAWADA ( / APPELLANT) ( / RESPONDENT) / APPELLANT BY : SHRI G.V.N.HARI , AR / RESPONDENT BY : S HRI D.K.SONOWAL , CIT DR / DATE OF HEARING : 1 8 . 0 6 . 201 9 / DATE OF PRONOUNCEMENT : 21 .06 . 201 9 / O R D E R P ER SHRI D.S.SUNDER SINGH, ACCOUNTANT MEMBER : THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) [CIT(A)], KURNOOL VIDE ITA NO.502/CIT(A)/KNL/2016 - 17DATED 11.02.2019 FOR THE ASSESSMENT YEAR (A.Y.) 2013 - 14. 2 I.T.A. NO . 14 2 /VIZ/2019 RAMISETTY RAVI KUMAR, VIJAYAWADA 2. GROUND NO.4(A) IS RELATED TO THE ADDITIONAL EVIDENCE FURNISHED BY THE ASSESSEE RELATING TO THE SOURCES UNDER RULE 46A OF THE INCOME TAX ACT, 1961(IN SHORT ACT). 3. GROUND NO.4(B) IS RELATED TO THE ADDITION OF RS.4,00,000/ - MADE BY THE ASSESSING OFFICER (AO) FOR WANT O F EVIDENCE. 4. GROUND NO.4(C) IS ALSO RELATED TO THE ADDITION MADE BY THE AO FOR WANT OF EVIDENCE. 5. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF TRADING IN LIQUOR, PURCHASE AND SALE OF SHARES. FOR THE A.Y. 2013 - 14, THE ASSESSEE FILED THE RETURN OF INCOME DECLARING TOTAL INCOME OF RS.7,06,250/ - AND THE ASSESSMENT WAS COMPLETED U/S 143(3) ON TOTAL INCOME OF RS.16,96,860/ - . THE AO MADE THE FOLLOWING ADDITIONS TO THE RETURNED INCOME. TOTAL INCOME RETURNED RS.7,06,250 AD D : UNEXPLAINED CASH CREDIT IN CAPITAL ACCOUNT RS.4,00,000 ADD : UNEXPLAINED CASH CREDIT IN CAPITAL ACCOUNT (EXCISE LICENCE FEE) RS.3,25,630 ADD : INCREASE IN NET PROFIT RS.2,64,978 6. AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE WENT ON APPEAL BEFORE THE CIT(A). IN RESPONSE TO THE NOTICES ISSUED BY THE CIT(A), NONE APPEARED 3 I.T.A. NO . 14 2 /VIZ/2019 RAMISETTY RAVI KUMAR, VIJAYAWADA BEFORE THE LD.CIT(A), THE LD.CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE AND CONFIRMED THE ADDITIONS OF UNEXPLA INED CASH CREDITS IN THE CAPITAL ACCOUNT AMOUNTING TO RS.7,25,630/ - . HOWEVER IT IS OBSERVED FROM THE LD.CIT(A) ORDER THAT THE ASSESSEE HAD FILED CASH FLOW STATEMENTS EXPLAINING THE SOURCES FOR INTRODUCTION OF CAPITAL BUT THE ASSESSEE DID NOT FILE PETITI ON FOR ADMISSION OF ADDITIONAL EVIDENCE BEFORE THE CIT(A). THEREFORE, THE LD.CIT(A) REJECTED THE ADDITIONAL EVIDENCE PRODUCED BY THE ASSESSEE SINCE, IT WAS NOT FURNISHED BEFORE THE AO AND DISMISSED THE APPEAL OF THE ASSESSEE. 7. AGGRIEVED BY THE ORDER O F THE LD.CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THIS TRIBUNAL. DURING THE APPEAL HEARING, THE LD.AR SUBMITTED THAT THE ASSESSEE IS A REGULAR ASSESSEE, FURNISHED CASH FLOW STATEMENT EXPLAINING THE SOURCES WITH THE INCOMES DECLARED IN THE EARLIER YEARS WI TH WRITTEN SUBMISSIONS BEFORE THE CIT(A). THOUGH THE PETITION FOR ADMISSION OF ADDITIONAL EVIDENCE IS NOT FILED BEFORE THE AO, THE LD.AR ARGUED THAT WRITTEN SUBMISSIONS WERE MADE BEFORE THE LD.CIT(A) WHICH WAS NOT CONSIDERED BY THE LD.CIT(A). THE LD.AR FU RTHER SUBMITTED THAT THERE ARE SUFFICIENT SOURCES FOR CREDITS IN THE CAPITAL ACCOUNT FROM THE INCOME ALREADY DECLARED IN THE EARLIER YEARS. THEREFORE, REQUESTED TO ADMIT THE ADDITIONAL 4 I.T.A. NO . 14 2 /VIZ/2019 RAMISETTY RAVI KUMAR, VIJAYAWADA EVIDENCE AND SEND THE ISSUE BACK TO THE FILE OF THE CIT(A) TO DECIDE T HE APPEAL. 8. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL PLACED ON RECORD. THE LD.AR FURNISHED THE CASH FLOW STATEMENT DURING THE HEARING ACROSS THE BENCH WITHOUT PETITION FOR ADMISSION OF ADDITIONAL EVIDENCE AND WITHOUT GIVING PRIOR NOTICE . THEREFORE, THE ADDITIONAL EVIDENCE FURNISHED BY THE ASSESSEE IN THE FORM OF CASH FLOW STATEMENT IS REJECTED. HOWEVER, ON GOING THROUGH THE LD.CIT(A) ORDER, WE FIND THAT CIT(A) PASSED THE ORDER SINCE THE ASSESSEE FAILED TO EXPLAIN THE SOURCES. THE CONT ENTION OF THE LD.AR WAS THAT PARTNERS OF THE ASSESSEE ARE HAVING SUFFICIENT SOURCES AND SURPLUS FUNDS FROM THE INCOME DECLARED IN THE EARLIER YEARS AND THE AO DID NOT EXAMINE THE EARLIER YEARS RETURNS TO ASCERTAIN THE SOURCE OF INTRODUCTION OF CAPITAL. HE NCE, WE ARE OF THE CONSIDERED OPINION THAT IN THE INTEREST OF JUSTICE, ADDITIONAL EVIDENCE PRODUCED BY THE ASSESSEE BEFORE THE CIT(A) REQUIRED TO BE ADMITTED AND THE SOURCES FOR INTRODUCTION OF CAPITAL REQUIRES FRESH EXAMINATION WITH THE CASH FLOW STATEMEN T FURNISHED BY THE ASSESSEE. THEREFORE, WE REMIT THE MATTER BACK TO THE FILE OF THE CIT(A) WITH A DIRECTION TO ADMIT THE ADDITIONAL EVIDENCE PRODUCED BY THE ASSESSEE AND 5 I.T.A. NO . 14 2 /VIZ/2019 RAMISETTY RAVI KUMAR, VIJAYAWADA DECIDE THE APPEAL ON MERITS AFTER VERIFYING THE ADDITIONAL EVIDENCE. ACCORDINGLY, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. 9 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 21 ST JUNE 2019. S D/ - S D/ - ( . ) ( . . ) (V. DURGA RAO) ( D.S. SUNDER SINGH ) /JUDICIAL MEMBER /ACCOUNTANT MEMBER /VISAKHAPATNAM /DATED : 21 .06.2019 L.RAMA, SPS / COPY OF THE ORDER FORWARDED TO: - 1. / THE ASSESSEE - RAMISETTY RAVI KUMAR, D.NO.11 - 6 - 36, ABDULAZEEM STREET, ISLAMPET, VIJAYAWADA 2. / THE REVENUE INCOME TAX OFFICER, WARD - 1(1), VIJAYAWADA 3. THE PR. COMMISSIONER OF INCOME TAX - 1 , VIJAYAWADA 4. THE COMMISSIONER OF TAX (APPEALS) , KURNOOL 5 . , , / DR, ITAT, VISAKHAPATNAM 6 . / GUARD FILE / BY ORDER // TRUE COPY // SR. PRIVATE SECRETARY ITAT, VISAKHAPATNAM