ACIT, Circle 1, Nellore V. Sri K. Balachandra Reddy, Nellore

ITA 1422/HYD/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 53524 (ITAT-HYDERABAD)
• Duration Of Justice: 8 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-08-2011
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 15-11-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: K V N CHARYA
• Keywords: Principle of natural justice; Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A , HYDERABAD BEFORE SHRI G.C. GUPTA, VICE PRESIDENT AND SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER ITA NO.1422/HYD/2010 : ASSESSMENT YEAR 2007- 08 ASST. COMMISSIONER OF INCOME - TAX , CIRCLE I, NELLORE. V/S. SHRI K. BALACHANDRA REDDY, NELLORE. (PAN ALPPK 0653 H) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI K.V.N.CHARYA RESPONDENT BY : NONE O R D E R PER G.C.GUPTA, VICE PRESIDENT: THIS APPEAL BY THE REVENUE FOR THE ASSESSMENT YEA R 2007-08 IS DIRECTED AGAINST THE ORDER OF THE COMMIS SIONER OF INCOME- TAX(APPEALS). 2. GROUNDS OF THE REVENUE IN THIS APPEAL READ AS U NDER- 1. THE ORDERS OF THE LEARNED COMMISSIONER OF INCOM E- TAX(APPEALS), GUNTUR IS CONTRARY TO LAW AND FACTS A ND CIRCUMSTANCES OF THE CASE. 2. IN THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LEARNED COMMISSIONER OF INCOME-TAX(APPEALS) ALLOWED THE ASSESSEES APPEAL WITHOUT CONSIDERING THE MERITS OF THE ADDITIONAL EVIDENCES FILED AND WITHOUT AFFORDING AN OPPORTUNITY FOR THE ASSESSING OFFICER. 3. THERE WAS A FAILURE ON THE PART OF THE ASS ESSEE IN DISCHARGING THE INITIAL ONUS IN THE CONFIRMATI ON LETTERS, ADDRESSES, ETC. BY THE ASSESSEE WHEN SPECIFI CALLY DIRECTED TO DO SO. ITA NO.1422/H/2010 SHRI K.BALACHANDRA REDDY, NELLORE. 2 4. PROVING THE CREDITS IN THE BOOKS OF THE ASSESSEE WH EN DIRECTED BY AO TO DO SO SQUARELY VESTS ON THE ASSESSEE AND F AILED DESPITE OF OPPORTUNITIES PROVIDED. 2. AT THE TIME OF HEARING, NONE APPEARED ON BEHALF OF THE ASSESSEE-RESPONDENT AND THEREFORE, THE APPEAL IS BE ING DISPOSED OFF EX-PARTE QUA -THE ASSESSEE-RESPONDENT- ON MERITS, AFTER HEARING THE LEARNED DEPARTMENTAL REPRESENTATIVE. 3. LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE CIT(A) HAS ALLOWED THE APPEAL FOR THE ASSESSEE WITH OUT CONSIDERING THE MERITS OF THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE AND WITHOUT AFFORDING OPPORTUNITY TO THE ASSESSING OFFI CER AND THEREFORE, THE MATTER MAY BE SET ASIDE TO THE FILE OF THE ASSE SSING OFFICER FOR DE NOVO ASSESSMENT ORDER. 4. WE HAVE CONSIDERED THE SUBMISSIONS OF THE LEA RNED DEPARTMENTAL REPRESENTATIVE AND HAVE PERUSED THE O RDERS OF THE ASSESSING OFFICER AND THE CIT(A). WE FIND THAT THE ASSESSMENT IN THIS CASE WAS FRAMED EX-PARTE BY THE ASSESSING OFFICER U NDER S.144 OF THE ACT. ASSESSEE WAS GIVEN A NUMBER OF OPPORTUNITIES B Y THE ASSESSING OFFICER AT THE ASSESSMENT STAGE. DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE THE CIT(A), THE ASSESSEE HAS FIL ED ADDITIONAL EVIDENCE IN SUPPORT OF HIS CASE REGARDING THE GENUI NENESS OF THE CREDIT ENTRIES. IN THE REMAND REPORT, THE ASSESSIN G OFFICER HAS SUBMITTED THAT THE ADDITIONS MADE ON ACCOUNT OF THE CREDIT ENTRIES WERE JUSTIFIED, AS THE SUMMONS ISSUED TO THE ASSESS EE ON 4.12.2009 FOR PRODUCTION OF THE CREDITORS HAS NOT BEEN COMPLI ED WITH. MOREOVER, THE ASSESSING OFFICER HAS OBSERVED THAT THE ASSESSE E HAS NOT FURNISHED EVEN THE ADDRESSES OF THE PERSONS FROM WH OM ASSESSEE ITA NO.1422/H/2010 SHRI K.BALACHANDRA REDDY, NELLORE. 3 HAS CLAIMED TO HAVE RECEIVED THE AMOUNTS ON CREDIT. THE CIT(A) HAS OBSERVED THAT THE SUMMONS TO THE ASSESSEE DATED 4. 12.2009 WERE SERVED ON 7.12.2009 FOR COMPLIANCE ON 10.12.2009, T HUS LEAVING ONLY TWO DAYS IN BETWEEN FOR PHYSICAL PRODUCTION OF CRED ITORS, WHICH IN HIS OPINION, WOULD BE HARSH AND WOULD NOT MEET THE PRIN CIPLES OF NATURAL JUSTICE. IN THESE FACTS, PROPER COURSE FOR THE CIT (A) WAS TO CALL FOR ONE MORE REMAND REPORT FROM THE ASSESSING OFFICER, WITH A DIRECTION TO PROVIDE SUFFICIENT OPPORTUNITY TO THE ASSESSEE T O COMPLY WITH ITS NOTICE, WHICH WAS NOT DONE BY THE CIT(A). HE HAS A CCEPTED THE CASE OF THE ASSESSEE BY MERELY OBSERVING THAT THE ASSESS ING OFFICER WAS SHYING AWAY FROM THE ONEROUS DUTY CAST ON HIM. IN THESE FACTS, WE HOLD THAT IT SHALL BE IN THE INTERESTS OF JUSTICE T O PROVIDE FAIR OPPORTUNITY TO BOTH THE PARTIES AND ACCORDINGLY THE ORDERS OF THE AUTHORITIES BELOW ARE SET ASIDE AND THE MATTER IS R ESTORED TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO FRAME THE ASSESSMENT DE NOVO IN ACCORDANCE WITH LAW, AFTER ALLOWING DUE OPP ORTUNITY OF HEARING TO THE ASSESSEE. ASSESSEE SHALL BE AT LIB ERTY TO FILE EVIDENCE IN SUPPORT OF HIS CASE, AND HE IS ALSO DIRECTED TO COOPERATE WITH THE DEPARTMENT IN THE MATTER OF FINALIZATION OF THE ASS ESSMENT . WE DIRECT ACCORDINGLY. 6. IN THE RESULT, REVENUES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 5 TH AUGUST, 2011 SD/- SD/- (CHANDRA POOJARI) ( G.C. G UPTA) ACCOUNTANT MEMBER VICE PRESIDENT DATED 5 TH AUGUST, 2011 ITA NO.1422/H/2010 SHRI K.BALACHANDRA REDDY, NELLORE. 4 COPY FORWARDED TO: 1. SHRI K. BALACHANDRA REDDY, F.387, 2 ND CR O SS ROAD, TEKKEMITTA EXTENSION, MAGUNTA LAYOUT, NELLORE. 2. ASST. COMMISSIONER OF INCOME-TAX, CIRCLE-I, NEL LORE. 3. COMMISSIONER OF INCOME - TAX(APPEALS) GUNTUR. 4. COMMISSIONER OF INCOME - TAX GUNTUR. 5. THE D.R., ITAT, HYDERABAD. B.V.S