Ajay Kumar Bhardwaj, New Delhi V. ITO Ward-63(2), New Delhi

ITA 1718/DEL/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 9550 (ITAT-DELHI)
• Duration Of Justice: 10 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 01-03-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Bogus purchase; Principle of natural justice; Reassessment proceedings
• Section: 69C; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SMC NEW DELHI BEFORE SHRI H. S. SIDHU, JUDICIAL MEMBER I.T.A. NO. 1718/DEL/2019 ASSESSMENT YEAR: 2008-09 SH. AJAY KUMAR BHARDWAJ, VS. INCOME TAX OFFICER, A-5/256, KOTHIL BLOCK A 5, WARD-63(2), NEW DELHI PASCHIM VIHAR, DELHI (PAN:AIBPB0402E) (ASSESSEE) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : SH. PRADEEP SINGH GAUTAM, SR. DR. ORDER THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER DATED 28.01.2019 PASSED BY THE LD. CIT(A)-38, DELHI, RELA TING TO ASSESSMENT YEAR 2008-09 ON THE FOLLOWING GROUNDS:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ORD ER PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) [CIT(A )] IS BAD, BOTH IN THE EYES OF LAW AND ON FACTS. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE ORDE R PASSED BY THE LEARNED CIT(A) IS BAD IN LAW HAVING BEEN PASSED EX PARTE WITHOUT GIVING THE ASSESSEE AN APPROPRIATE AND ADEQUATE OPP ORTUNITY OF BEING HEARD IN CLEAR VIOLATION OF THE PRINCIPLES OF NATURAL JUSTICE. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEA RNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN CONFIRMING THE AC TION OF THE AO DESPITE THE FACT THAT THE REASSESSMENT INITIATED ON A DEAD PERSON AND THEREFORE REASSESSMENT PROCEEDINGS ARE VOID AB INITIO. 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, LEARNED CIT(A) HAS ERRED, BOTH ON FACTS AND IN LAW IN REJECTING THE CO NTENTION OF THE ASSESSEE THAT THE INITIATION OF THE REASSESSMENT PR OCEEDINGS AND THE REASSESSMENT ORDER ARE BAD, BOTH ON THE FACTS AND I N LAW AND LIABLE TO BE QUASHED, AS THE STATUTORY CONDITIONS AND PROC EDURE PRESCRIBED UNDER THE STATUTE HAVE NOT BEEN COMPLIED WITH. 2 5. (I) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, LEARNED CIT(A) HAS ERRED, BOTH ON FACTS AND IN LAW IN REJECTING THE CO NTENTION OF THE ASSESSEE THAT THE REASSESSMENT PROCEEDINGS INITIATE D BY THE AO ARE BAD IN THE EYES OF LAW, AS THE REASONS RECORDED FOR THE ISSUE OF NOTICE UNDER SECTION 148 ARE BAD IN THE EYES OF LAW AND ARE CONTRARY TO THE FACTS. (II) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, LE ARNED CIT(A) HAS ERRED, BOTH ON FACTS AND IN LAW IN REJECTING THE CO NTENTION OF THE ASSESSEE THAT THE REASSESSMENT ORDER PASSED BY THE AO IS BAD AND LIABLE TO BE QUASHED AS THE SAME HAS BEEN REOPENED ON THE BASIS OF THE REASONS WHICH ARE VAGUE AND HAVE BEEN RECORDED WITHOUT APPLICATION OF MIND ON THE PART OF THE AO. 6. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN CONFIR MING THE ADDITION OF AN AMOUNT OF RS.11,35,484/- ON ACCOUNT OF PURCHA SES MADE BY THE ASSESSEE TREATING THE SAME AS BOGUS INVOKING SE CTION 69C OF THE INCOME TAX ACT. 7. (I) ON THE FACTS AND CIRCUMSTANCES OF THE CA SE, THE LEARNED CIT(A) HAS ERRED, BOTH ON FACTS AND IN LAW IN CONFI RMING THAT THE FIRM M/S SHREE BANKEY BIHARI TRADING CO.& M/S VISHU TRAD ING CO,, IS NOT ENGAGED IN ACTUAL BUSINESS, IGNORING THE FACT THAT DURING THE COURSE OF SEARCH ON THESE FIRMS SUBSTANTIAL INVENTORY IN R ESPECT OF THE MATERIAL BEING PURCHASED BY THE ASSESSEE WAS FOUND, WHICH CONFIRMS THE FACT THAT THESE FIRMS WERE DOING ACTUAL BUSINES S. (II) ON THE FACTS AND CIRCUMSTANCES OF THE CAS E, THE LEARNED CIT(A) HAS ERRED, BOTH ON FACTS AND IN LAW IN REJEC TING THAT THE INFERENCE DRAWN BY THE AO MERELY ON THE BASIS OF A STATEMENT THAT THESE FIRMS ARE NOT IN ACTUAL BUSINESS IS BASELESS AND CONTRARY TO THE FACTS ON RECORD. 8. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED, BOTH ON FACTS AND IN LAW IN REJEC TING THE CONTENTION OF THE ASSESSEE IN IGNORING THE FACT THAT THE QUANT ITY PURCHASED AND SOLD BEING COMPLETELY TALLYING, THE ALLEGATION THAT THE ASSESSEE HAS NOT MADE PURCHASES CANNOT BE SUSTAINED. 9. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED, BOTH ON FACTS AND IN LAW IN CONFI RMING THE ADDITION ON ACCOUNT OF BOGUS PURCHASES, DESPITE THEIR BEING ADEQUATE MATERIAL AND EVIDENCES BROUGHT ON RECORD BY THE ASS ESSEE BEFORE THE AO TO SHOW THAT THE PURCHASES AND SALES WERE MADE I N THE REGULAR COURSE OF BUSINESS. 3 10. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED, BOTH ON FACTS AND IN LAW IN REJEC TING THE CONTENTION OF THE ASSESSEE THAT THE ADDITION SO MADE ON THE BA SIS OF MATERIAL COLLECTED AT THE BACK OF THE ASSESSEE, IS BAD IN LA W AND LIABLE TO BE DELETED. 11. ON THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LEARNED CIT(A) HAS ERRED, BOTH ON FACTS AND IN LAW IN REJEC TING THE CONTENTION OF THE ASSESSEE THAT THE ADDITION MADE BY THE AO IS UNTENABLE IN THE EYES OF LAW, HAVING BEEN MADE WITHOUT PROVIDING OPP ORTUNITY TO CROSS EXAMINE THE PERSON ON THE BASIS OF WHOSE STAT EMENT THE ALLEGATIONS HAVE BEEN MADE AGAINST THE ASSESSEE AND WITHOUT FOLLOWING THE PRINCIPLES OF NATURAL JUSTICE. 2. THE ASSESSEE HAS FILED THIS APPEAL ON 01.03.2019 . REGISTRY ISSUED RPAD TO THE ASSESSEE. IN RESPONSE TO THE SAME, ASSE SSEE NOR HIS AUTHORIZED REPRESENTATIVE APPEARED NOR FILED ANY AP PLICATION FOR ADJOURNMENT. THE BENCH ADJOURNED THE MATTER FOR 01. 01.2020 AND ISSUED RPAD TO THE ASSESSEE. IN SPITE OF THE SAME, ASSESSE E AGAIN DID NOT APPEAR NOR FILED ANY APPLICATION FOR ADJOURNMENT. 3. KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF T HE PRESENT CASE, I AM OF THE VIEW THAT NO USEFUL PURPOSE WOULD BE SERV ED TO ISSUE NOTICE AGAIN AND AGAIN ON THE ADDRESS GIVEN BY THE ASSESSE E IN FORM NO. 36. THEREFORE, I AM DECIDING THE APPEAL EX PARTE ASSESS EE, AFTER HEARING LEARNED DR. 4. I HAVE GONE THROUGH THE ORDERS PASSED BY THE REV ENUE AUTHORITIES ESPECIALLY THE IMPUGNED ORDER PASSED BY THE LEARNED FIRST APPELLATE AUTHORITY DATED 28.01.2019, I AM OF THE VIEW THAT L EARNED FIRST APPELLATE AUTHORITY HAS NOT PROVIDED SUFFICIENT OPPORTUNITY T O THE ASSESSEE WHICH IS CONTRARY TO THE PRINCIPLES OF NATURAL JUSTICE AND T HE IMPUGNED ORDER IS NOT SUSTAINABLE IN THE EYES OF LAW THEREFORE, I AM SETT ING ASIDE THE ISSUES IN 4 DISPUTE TO THE LEARNED FIRST APPELLATE AUTHORITY TO DECIDE THE SAME AFRESH, AS PER LAW, AFTER GIVING OPPORTUNITY TO THE ASSESSE E. 5. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATISTICA L PURPOSES. ORDER PRONOUNCED ON 07/01/2020. SD/- [H.S. SIDHU] JUDICIAL MEMBER DATE: 07/01/2020 SH COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES