ITO, New Delhi V. M/s. Basic Developers Pvt. Ltd., New Delhi

ITA 1508/DEL/2010

• Counselvise Citation: 150820114 RSA 2010
• Duration Of Justice: 2 year(s) 4 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-08-2012
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 26-06-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 06-04-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MRS GEETMALA MOHANANY
• Keywords: Additional evidence
• Section: 133(6); 131; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH A NEW DELHI) BEFORE SHRI R.P. TOLANI, JUDICIAL MEMBER AND SHRI T.S. KAPOOR, ACCOUNTANT MEMBER I.T.A. NO.1508/DEL/2010 ASSESSMENT YEAR : 2006-07 ITO, M/S BASIC DEVELOPERS PVT. LTD., WARD-2 (3), 23/26, EAST PATEL NAGAR, NEW DELHI. V. NEW DELHI. (APPELLANT) (RESPONDENT) PAN /GIR/NO. PAN /GIR/NO. PAN /GIR/NO. PAN /GIR/NO.AACCB AACCB AACCB AACCB- -- -9584 9584 9584 9584- -- -B BB B APPELLANT BY : MRS. GEETMALA MOHANANY, CIT-DR. RESPONDENT BY : NONE. ORDER PER TS KAPOOR, AM: THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE OR DER OF LD CIT(A) DATED 7.1.2010. THE GROUNDS RAISED BY THE REVENUE AR E AS UNDER:- 1. THE LD CIT(A) HAS ERRED ON FACTS AND IN LAW BY DIREC TING TO DELETE THE ADDITION OF 1.2.50 CRORES ON ACCOUNT OF UNEXPLAI NED CASH CREDITS IGNORING THAT THE ASSESSEE FAILED TO PROVIDE NAM E, ADDRESS AND CONFIRMATION FROM THE LOAN CREDITOR TO TH E ASSESSING OFFICER IN SPITE OF NUMBER OF OPPORTUNITIES PROVIDED TO THE ASSESSEE IN THIS REGARD. 2. THE LD CIT(A) HAS ERRED IN LAW AND ON FACTS BY ADMI TTING ADDITIONAL EVIDENCE WITHOUT CONFRONTING THE SAME TO THE ITA NO1508/DEL/2010 2 ASSESSING OFFICER THUS VIOLATING THE PROVISIONS OF RULE 46 A(3) OF THE IT RULES, 1962. 3. THE CASE LAWS RELIED UPON BY THE LD CIT(A) ARE NOT RE LEVANT TO THE FACTS OF THE PRESENT CASE. 4. THE APPELLANT CRAVES LEAVE FOR RESERVING THE RIGHT T O AMEND, MODIFY ALTER, ADD OR FOREGO ANY GROUND(S) OF APPEAL AT ANY TIME BEFORE OR DURING THE HEARING OF THE APPEAL. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS EN GAGED IN THE PURCHASE AND SALE OF AGRICULTURAL LAND ON BEHALF OF OTHERS AND IT RECEIVES ADVANCES FROM VARIOUS CLIENTS AND ALSO GIVES AD VANCE ON BEHALF OF CLIENTS FOR PURCHASE OF LAND. IN THE INSTAN T CASE, ONE SHRI SHIVRAJ SINGH DABRA PAID ` .2.50 CRORES TO THE ASSESSEE FOR PURCHASING OF LAND ON HIS BEHALF AND CERTAIN AGRICULTURAL LAND WAS PURCHASED ON BEHALF OF SHRI SHIVRAJ SINGH DABRA BUT THE SALE DEED S WERE NOT EXECUTED BECAUSE OF CERTAIN DISPUTES. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY. DURING ASSESSMENT PROCEEDINGS, TH E ASSESSING OFFICER ENQUIRED ABOUT CERTAIN ADVANCES RECEIVED FRO M VARIOUS PERSONS INCLUDING MR. SHIVRAJ SINGH DABRA. THE ASSESSEE FILED C OPIES OF CONFIRMATION FROM THE DEPOSITORS BUT COULD NOT FILE T HE SAME FROM SHRI SHIVRAJ SINGH DABRA. ON BEING ASKED ABOUT CONFIRMATI ON AND EVIDENCE OF ADVANCES RECEIVED, THE ASSESSEE STATED THAT CONFIRMATI ON COULD NOT BE PRODUCED DUE TO UNAVOIDABLE CIRCUMSTANCES. THE ASSESSE E COMPANY WAS ALSO NOT ABLE TO PRODUCE ANY DOCUMENTS/AGR EEMENTS WITH THE ABOVE MR. DABRA TO JUSTIFY RECEIVING ADVANC E FROM HIM. AFTER GIVING TWO MORE OPPORTUNITIES, THE ASSESSING OFFICER ADD ED AN AMOUNT OF ` .2.50 CRORES TO THE INCOME OF THE ASSESSEE U/S 68 OF TH E INCOME TAX ACT, 1961 BECAUSE THE GENUINENESS AND CREDITWORTHINESS WAS NOT PROVED. ITA NO1508/DEL/2010 3 3. AGGRIEVED, THE ASSESSEE FILED APPEAL BEFORE LD CIT( A) AND SUBMITTED AS UNDER:- I) THAT ` .2.50 CRORES WAS RECEIVED BY A/C PAYEE CROSSED CHEQUE AND PRAYED THAT MR. SHIVRAJ SINGH DABRA WAS NOT AVAI LABLE AT THE RELEVANT TIME. HOWEVER, THERE WAS SUFFICIENT OTHER VE RIFIABLE MATERIAL BEFORE ASSESSING OFFICER FROM WHICH THE FACT COULD HAVE BEEN VERIFIED. II) THAT MANY TIMES MR. SHIVRAJ SINGH DABRA AND HIS OFFICE WERE CONTACTED BUT AT ALL THE TIMES THE REPLY WAS THAT MR. DABRA WAS OUT OF STATION AND ONLY IN THE MONTH OF MAY, 2009, T HE ASSESSEE WAS ABLE TO OBTAIN CONFIRMATION FROM MR. SHYIVRAJ SI NGH DABRA. 4. THE LD AR ALSO REQUESTED FOR FILING OF FRESH EVIDEN CE IN THE FORM OF CONFIRMATION FROM MR. SHIVRAJ SINGH DABRA, COPY OF BANK ACCOUNT FROM WHICH ` .2.50 CRORES WAS GIVEN. COPY OF PASSPORT OF DEPOSITOR T O PROVE THAT CREDITOR WAS OUT OF COUNTRY AT THE RELEVA NT TIME AND REQUESTED THAT THE EVIDENCE COULD NOT BE FILED BEFOR E ASSESSING OFFICER DUE TO CIRCUMSTANCES BEYOND ASSESSEES CONTROL AND THEREF ORE PLEADED FOR ADMISSION OF THE SAME. THE LD CIT(A) CALLED FOR RE MAND REPORT FROM ASSESSING OFFICER WHICH WAS RECEIVED VIDE LETTER DATED 1 4.10.2009. THE ASSESSING OFFICER IN THE REMAND REPORT SAID THAT NOT ICE U/.S 133(6) OF THE ACT WAS ISSUED TO MR. SHIVRAJ SINGH DABRA AT T HE ADDRESS GIVEN BY THE ASSESSEE COMPANY BUT THE SAID LETTER CAME BACK UN -DELIVERED WITH THE REMARKS OF POSTAL AUTHORITY NO SUCH PERSON AT THIS ADDRESS. THE ASSESSING OFFICER FURTHER STATED THAT FURTHER OPPORT UNITIES WERE GIVEN TO THE ASSESSEE AND COUNSEL OF THE ASSESSEE TO PRODUC E MR., SHIVRAJ SINGH DABRA BUT THE SAME WAS NOT COMPLIED WIT H. THEREFORE, THE ASSESSING OFFICER IN HIS REMAND REPORT SUBMITTED THAT ASSESSEE ITA NO1508/DEL/2010 4 COMPANY DURING ASSESSMENT PROCEEDINGS AND DURING REMAND PROCEEDINGS COULD NOT PROVE IDENTITY, CREDITWORTHINE SS AND GENUINENESS OF THE DEPOSITOR, THEREFORE, HE REQUESTED T HAT SUBMISSION MADE BY THE ASSESSEE SHOULD NOT BE ENTERTAINED. THE LD A R ON RECEIPT OF COPY OF REMAND REPORT SUBMITTED THAT MR. SHIVRAJ SINGH DABRA COULD NOT BE PRODUCED AS HE REMAINED OUT OF COUNTRY MOST O F THE TIME. HE FURTHER SUBMITTED THAT LD ASSESSING OFFICER ALSO COULD NOT MAKE HIM APPEAR BEFORE HIM THROUGH EXERCISE OF HER POWERS AVA ILABLE U/S 131 OF THE ACT AND FURTHER SUBMITTED THAT THE ASSESSEE HAD NOT ONLY PRODUCED THE CONFIRMATION BUT ALSO PRODUCED THE BANK ACCOUNT OF MR. SHIVRAJ SINGH DABRA TO PROVE IDENTITY AND GENUINENESS OF THE DEPOSITOR. THEREFORE, HE AGAIN REQUESTED FOR ADMISSION OF ADDITI ONAL EVIDENCE. 5. THE LD CIT(A) AFTER CONSIDERING THE REMAND REPORT AND REJOINDER THEREOF ACCEPTED THE ADDITIONAL EVIDENCE AND DELETE D THE ADDITION MADE BY THE ASSESSING OFFICER. THE RELEVANT PORTION OF LD CIT(A)S ORDER IS REPRODUCED BELOW:- THE ASSESSING OFFICER HAVING FAILED TO VERIFY THE DOCU MENTARY EVIDENCE AND EXERCISE HER POWERS U/S 131 OF THE ACT, C ANNOT PLEAD FOR ANOTHER OPPORTUNITY ON THE GROUND THAT IF YOUR HONOUR STILL FEELS THAT AN ENQUIRY IS NEEDED, THE SAME WILL BE CONDUCTED IN ACCORDANCE WITH LAW. I AM UNABLE TO UNDERSTAND WH AT THE ASSESSING OFFICER WANTS TO CONVEY BY OBSERVING AS ABOVE. I F SHE IS TO CONDUCT ENQUIRY IN ACCORDANCE WITH LAW ONLY, T HEN WHAT DID SHE DO DURING THE REMAND PROCEEDINGS? WAS NOT THE REMA ND REPORT REQUIRED ON MY REQUISITION AND IF IT WAS ON MY REQUISITION, THEN THE ONLY CONCLUSION THAT COULD BE ARRIVED AT IS THAT THE PROCEEDINGS DURING REMAND WERE NOT IN ACCORDANCE WIT H LAW AND IF THAT IS THE SITUATION, THEN THE REMAND REPORT ITSEL F IS NO EST AND ITA NO1508/DEL/2010 5 CANNOT BE CONSIDERED. SHE SHOULD HAVE MADE ENQUIRY AB OUT THE GENUINENESS OF THE TRANSACTION AT THE REMAND REPORT ST AGE SUO MOTO. IN VIEW OF ABOUT DISCUSSION, I AM OF THE OPINION THAT ASSESSEE HAVING DISCHARGED THE INITIAL ONUS PUT IT UNDER THE PROVISION OF SECTION 68 OF THE ACT WITH RESPECT OF CASH CREDIT OF ` .2,50,00,000/- AND THE ASSESSING OFFICER HAVING FAILED TO BRING ANY EVIDENCE TO THE CONTRARY, I HAVE NO OPTION BUT TO ACCEPT THE GENUINENESS OF CASH CREDIT OF ` .2,50,00,.000/- AND THEREFORE DELETE THE ADDITION OF ` .2,50,00,000/- MADE BY THE ASSESSING OFFICER BY CONSIDERING THE CASH CREDIT AS UNEXPLAINED . SINCE THE ASSESSEE HAS NOT RAISED ANY OTHER ISSUE, THE ASSESSEES APPEAL I S ALLOWED AND ADDITION OF ` .2,50,00,000/- MADE U/S 68 OF THE ACT IS HEREBY DELETED. 6. AGGRIEVED THE REVENUE HAS FILED APPEAL BEFORE THI S TRIBUNAL. 7. THE LD DR AT THE OUTSET SUBMITTED THAT DURING ASSES SMENT PROCEEDINGS AND DURING REMAND PROCEEDINGS ASSESSEE COULD NOT PRODUCE MR. SHIVRAJ SINGH DABRA FOR EXAMINATION AND NECESSARY ENQUIRIES. THEREFORE, HE ARGUED THAT IN VIEW OF THE UN-EXPLAINED NATURE OF CASH CREDIT, THE ADDITION WAS RIGHTLY MADE U/S 68 O F THE INCOME TAX ACT, 1961. IN ALTERNATIVE, HE ARGUED THAT CASE BE SET ASIDE TO THE OFFICE OF ASSESSING OFFICER FOR FRESH EXAMINATION AND ADJUDICAT ION. NOBODY APPEARED ON BEHALF OF THE ASSESSEE. 8. WE HAVE HEARD AND HAVE GONE THROUGH THE MATERIAL PLACED ON RECORD. WE HAVE OBSERVED THAT ASSESSEE HAD NOT ABLE TO P RODUCE MR. DABRA BEFORE ASSESSING OFFICER DURING ASSESSMENT PROCEEDI NGS AS WELL AS DURING REMAND PROCEEDINGS. THE LD CIT(A) HAD DELET ED THE ADDITION ON THE BASIS OF DOCUMENTS FILED BEFORE HIM WHICH WERE NOT BEFORE ITA NO1508/DEL/2010 6 ASSESSING OFFICER AND ASSESSING OFFICER WAS ALSO NOT ABLE TO EXAMINE THOSE DOCUMENTS AND CROSS EXAMINE THE DEPOSITOR TO ASCER TAIN THE GENUINENESS & CREDITWORTHINESS OF DEPOSITOR. THEREFORE, TO MEET BOTH ENDS OF JUSTICE, WE SET ASIDE THIS MATTER TO THE OFFICE OF ASSESSING OFFICER FOR FRESH ADJUDICATION. NEEDLESS TO SAY THAT NE CESSARY OPPORTUNITY WILL BE GIVEN TO THE ASSESSEE OF BEING HEAR D. 8. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. 9. ORDER PRONOUNCED IN THE OPEN COURT ON THE 9TH DA Y OF AUGUST, 2012. SD/- SD/- (R.P. TOLANI) (T.S. KAPOOR) JUDICIAL MEMBER ACCOUNTANT MEMBER DT. 9.8.2012. HMS COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT (A)-, NEW DELHI. 5. THE DR, ITAT, LOKNAYAK BHAWAN, KHAN MARKET, NEW DEL HI. TRUE COPY. BY ORDER (ITAT, NEW DELHI). DATE OF HEARING 26.6.2012 DATE OF DICTATION 1.8.2012 DATE OF TYPING 1.8.2012 ITA NO1508/DEL/2010 7 DATE OF ORDER SIGNED BY 9.8.2012 BOTH THE MEMBERS & PRONOUNCEMENT. DATE OF ORDER UPLOADED ON NET 9.8.2012 & SENT TO THE BENCH CONCERNED.