Anil Kumar Yadav, Gurgaon V. ITO,Ward-1(2), Gurgaon

ITA 1496/DEL/2023

AI Insights

The case involves Anil Kumar Yadav, who appealed against the order of the CIT(A), Gurgaon-1, for the Assessment Year 2011-12. The primary contention was regarding the unjust and unfair additions made to his income, which he argued were based on insufficient consideration of the evidence provided. The CIT(A) had disallowed certain expenses and additions were made based on the assumption of undisclosed income. The assessee argued that he had provided sufficient evidence to prove the ownership of vehicles and the sources of cash deposits, which were not adequately considered. However, the appeal was dismissed due to the absence of the assessee's representative and failure to comply with procedural requirements as directed by the Tribunal.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 115853 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-09-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 18-09-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 14-05-2023
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Gift; Business expenditure; Opportunity of being heard; Additional evidence; Condonation of delay; TDS; FORM 26AS
• Section: 147; 148; 194C; 274

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : SMC : DELHI BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER ITA No.1496/Del/2023 Assessment Year: 2011-12 Anil Kumar Yadav, S/o Shri Dhanna Ram, VPO Kherki Daula, Farrukhnagar, Gurgaon – 122 004. PAN: AQCPK2314D Vs ITO, Ward-1(2), Gurgaon. (Appellant) (Respondent) Assessee by : None Revenue by : Shri Om Parkash, Sr. DR Date of Hearing : 19.09.2023 Date of Pronouncement : 19.09.2023 ORDER This appeal by the assessee is filed against the order of the ld.CIT(A), Gurgaon-1, dated 19.06.2019 pertaining to Assessment Year 2011-12. The assessee has raised the following grounds of appeal:- “1. That the impugned orders dated 17.12.2018 by Income Tax Officer and later by CIT-A passed under relevant sections of the IT Act are unjust, unfair, illegal & strongly contested by each corner of law and principles of natural justice. 1 That the addition by CIT(A) was made citing reasons that - ■ assessee furnished evidence with regard to the ownership of only one vehicle - out of three, and ■ out of total cash withdrawal amount of Rs. 1,80,000/- must be used for household expenses, thus disallowed. ITA No.1496/Del/2023 2 2 The appellant has sufficient proofs to prove the ownership of vehicles like Registration Certificate, Loan Schedule, Bank Statement from which amount of EMIs used to be deducted. The same was also provided to the CIT(A) at the time of hearing, however, the order was passed without giving any chance of hearing which is against the principle of natural justice. 3 The case was fixed for hearing in 2019 and the case was related to FY 2010-11. The appellant has discontinued the business as he suffered losses in his business because he could not focus in it along with his job. After discontinuing the business, he sold the vehicles to some other person and in the year of hearing he was not the owner of the vehicles, thus, it was quite difficult to obtain the copy of registration certificates from the transport department. 4 To prove that the appellant was the owner of vehicles, the evidences provided to the CIT(A) was sufficient, however, CIT(A) did not communicate us that he was not satisfied or raised query and may need more documents for justification of the claim, rather he passed the order without giving reasonable opportunity of being heard. 5 One vehicle was registered in the name of father Mr. Dana Ram, this was bought/registered on 01/05/2010 and later transferred to Mr. Madan on 31/07/2013, appellant hereby submits Vehicle particulars certificate (HR55K2648) which clearly mentions that vehicle was owned by his father and later transferred; 6 In the assessment order of honorable CIT(A) it was also stated that household expenses of appellant are estimated to be Rs. 1,80,000/- and same was reduced from the benefit derived out because of cash withdrawals. In the assessment order passed by CIT(A) it was clearly mentioned that assessee has already considered the above amount of Rs. 1,80,000/- as his personal household expenses and same was reduced from the cash he received from his father. Thus, it is a prima facie case of mistake committed by CIT(A) while framing his order. 7 Due to poor knowledge and non-receipt of notices by the assessee, he could not respond to the notices issued u/s 148 and 142(1), which later result in assessment u/s 147 alongwith penalty u/s 274 read with 271(l)(b). 8 There was no intentional, avoidance or deliberate failure from assessee end in responding to the notices/proceedings. Lack of knowledge and unawareness of the consequences along with delivery issues in the village like delivery in the house of wrong Anil lead to non-response and delays in the said case. If notices would have been received by appellant he would have definitely responded and presented before the concerned officer. He contends that the postman did not delivered those on his address in YPO Kherki Daula, Gurugram which is a village and there are no proper house numbers and streets. ITA No.1496/Del/2023 3 9 Before CIT(A) he submitted the relevant evidences & documents and explained facts related to cash deposits sources – • As the appellant operated on Delhi-Gujrat route so the major part of cash deposits were in small amounts at various locations specifically on popular transport route (Eg. cities in Gujarat like Vadodara, Baroda, Akota, Lehripura, etc.), as evidenced by the bank statement that this cash is generated from transport business. • Further assesse has 3 trucks, which were on loan and EMI was being regularly paid. Assesse is also serving EMI’s of 3 vehicles and bearing operating costs like driver and cleaners salary, fuel expenses, repair & maintenance, tyre & tube expenses and permit fees, insurances etc. Assesse contends that there was hardly any margin being new business. • Although during the year a sometimes cash deposits may have been made out of cash withdrawals/cash in hand available as on deposit date to pay urgent instalments and meet day to day expenditures of business, • During the year his father also gifted or rather invested some amount to Anil, primarily to purchase vehicle and meet business expenses & vehicle loan instalments since the business not having enough cash flows being newly started business. • Form 26AS evidencing TDS deduction u/s 194C by various roadlines and carrier companies in same line of business. • Initial deposit of Rs. 1,90,000/- on 22/05/2010 was deposited from personal savings of Mr. Anil to pay for Truck purchase though DD. Same date a DD has been made as shown in bank statement and loan schedule of vehicle. • Rs. 3,00,000/- has been deposited on 07/01/2011, which he has taken from his father for the purchases of another vehicle. • Cash flow statement, P&L Account, Father’s bank statement and details for cash withdrawals were also submitted before CIT(A) 10. Honourable CIT(A) after considering the submission and documents was satisfied that the cash deposited was out of the sources mentioned above. But did not have the relief as expected. Ownership of 2 vehicles were ignored and order was passed without giving any opportunity to submit further documents for any queries raised by the honourable CIT(A). 11. During the relevant assessment year appellant owned 3 heavy vehicles (1 vehicle was registered in the name of appellant’s father) on the EMIs via bank loan and EMI’s were deducted from his same ICICI bank account. 12. In the order passed by CIT(A), grounds of appeal was accepted but the consequent benefit was not given/partly given on the basis of following grounds. A reconsideration shall be made for them. i. that ownership could not be established of 2 vehicles. ii. Ownership of truck by father has been considered and no benefit was given, ITA No.1496/Del/2023 4 iii. CIT(A)’s order states that registration certificate of only one vehicle No. HR55M3299 was submitted but RC of 2 vehicles were submitted. iv. One of the vehicle was transferred out of state for which RC was not possible to arrange. Although loan charts and EMI payments evidenced thesame. v. Ignoring the fact that freight and transport business also works on commission basis, where vehicle of others are used to transport goods and are taken on commission basis. Even trucks are available in market and hired drivers used them. It not necessary all owned vehicles were used in the business for all deliveries. Also, truck association provides trucks to agents/drivers/ transporters in the course of business. vi. CIT(A) accepted the assesse’s contention of depositing funds into bank out of cash withdrawals. Also, the receipt of Rs. 10 lakhs from his father was accepted. vii. Adding back the salary to the income, even though the TDS has already been deducted on the same by the company. This was not even pointed by AO in his order passed u/s 144/147. This is unreasonable increased the tax liability of the assessee, even though his salary can not be considered as any form of undisclosed income. The reason stated is that the assessee has not filed the return. viii. CIT(A) disregard the following sources viz-a-viz the cash flow statement filed by the appellant:- Cash generated from operation Rs. 3,80,139/- Cash on account of withdrawals Rs. 1,80,000/- Thereby making an addition of Rs. 5,60,139/-, which is unjust, unfair, and unreasonable in the said case considering the evidences submitted. 13. It is unjust and unfair to tax the amount twice, the appellant has already disallowed the amount from the amount received from his father, then again disallowing it from the cash withdrawals is unfair and against the rules of double taxation. 14. From the order of CIT(A) it is clearly evident that CIT(A) while framing his order did not consider the replies and documents furnished during the course of hearing and passed the order which creates undue hardship on the appellant. 15. That on the facts and in the circumstances of the case the appellant being aggrieved of making of additions by CIT(A) and objects the determination of additional tax. Modification of Ground of Appeal: That the appellant craves leave to amend or modify the Grounds of Appeal or add any new ground or grounds as may be relevant and deem fit and be allowed to lead additional evidence in accordance with law, if required, before the disposal of the appeal. That the appellant craves leave to adduce additional evidence. ITA No.1496/Del/2023 5 PRAYER In light of the above-mentioned facts, legal grounds challenging the impugned order and authoritative precedents, it is humbly and respectfully prayed that your honour be pleased to- • To condone the delays and accept, consider and reconsider the existing as well as additional evidences, documents and explanations submitted by us. • Set aside/remand bank the impugned order of Assessing Officer/CIT(A) allowing the appeal in full with consequential reliefs to the Appellant.” 2. At the time of hearing, no one attended the proceedings on behalf of the assessee. On the last date of hearing on 23 rd August, 2023, the assessee was directed to file concise grounds of appeal and remove the defects. It was directed that the application seeking condonation of delay ought to have been signed by the assessee. It is apparent from the record that the application has been signed by the counsel for the assessee. Despite giving opportunity to remove the defects, the assessee has neither modified the grounds nor removed the defects as pointed out by the Bench. Today no one represented the assessee. Therefore, the appeal is dismissed. However, the assessee is given liberty to move an application to this Tribunal for recalling of this order in case the assessee removes defects as pointed vide directions dated 23.08.2023. ITA No.1496/Del/2023 6 3. In the result, the appeal of the assessee is dismissed. Order pronounced in the open court on 19.09.2023. Sd/- (KUL BHARAT) JUDICIAL MEMBER Dated: 19 th September, 2023. dk Copy forwarded to : 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asstt. Registrar, ITAT, New Delhi