Ayush Fincap Pvt. Ltd., Ghaziabad V. ACIT, Meerut

ITA 1742/DEL/2011

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 3821 (ITAT-DELHI)
• Duration Of Justice: 1 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-06-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 09-06-2011
• Assessment Year: 2002-2003
• Appeal Filed On: 11-04-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: GEETMALA MOHANANI
• Keywords: Search and seizure; Opportunity of being heard

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH A : NEW DELHI DELHI BENCH A : NEW DELHI DELHI BENCH A : NEW DELHI DELHI BENCH A : NEW DELHI BEFORE SHRI G.E.VEERABHADRAPPA, VICE PRESIDENT AND BEFORE SHRI G.E.VEERABHADRAPPA, VICE PRESIDENT AND BEFORE SHRI G.E.VEERABHADRAPPA, VICE PRESIDENT AND BEFORE SHRI G.E.VEERABHADRAPPA, VICE PRESIDENT AND SHRI A.D.JAIN, JUDICIAL MEMBER SHRI A.D.JAIN, JUDICIAL MEMBER SHRI A.D.JAIN, JUDICIAL MEMBER SHRI A.D.JAIN, JUDICIAL MEMBER ITA NO.1742/DEL/2011 ITA NO.1742/DEL/2011 ITA NO.1742/DEL/2011 ITA NO.1742/DEL/2011 ASSESSMENT YEAR : 2002 ASSESSMENT YEAR : 2002 ASSESSMENT YEAR : 2002 ASSESSMENT YEAR : 2002- -- -03 0303 03 M/S AYUSH FINCAP PRIVATE M/S AYUSH FINCAP PRIVATE M/S AYUSH FINCAP PRIVATE M/S AYUSH FINCAP PRIVATE LIMITED, LIMITED, LIMITED, LIMITED, C/O, SD C/O, SD C/O, SD C/O, SD- -- -388, SHASTRI 388, SHASTRI 388, SHASTRI 388, SHASTRI NAGAR, NAGAR, NAGAR, NAGAR, GHAZIABAD. GHAZIABAD. GHAZIABAD. GHAZIABAD. PAN NO.AADCA9561A. PAN NO.AADCA9561A. PAN NO.AADCA9561A. PAN NO.AADCA9561A. VS. VS. VS. VS. ASSTT.COMMISSIONER OF ASSTT.COMMISSIONER OF ASSTT.COMMISSIONER OF ASSTT.COMMISSIONER OF INCOME TAX, INCOME TAX, INCOME TAX, INCOME TAX, CENTRAL CIRCLE, CENTRAL CIRCLE, CENTRAL CIRCLE, CENTRAL CIRCLE, MEERUT. MEERUT. MEERUT. MEERUT. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI AKHILESH KUMAR, ADVOCATE. RESPONDENT BY : MS.GEETMALA MOHANANI, CIT-DR. ORDER ORDER ORDER ORDER PER A.D.JAIN PER A.D.JAIN PER A.D.JAIN PER A.D.JAIN, JM : , JM : , JM : , JM : THIS IS ASSESSEES APPEAL TAKING THE FOLLOWING GROU NDS:- 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IS BAD IN LAW AS WELL AS IS AGAINST THE F ACTS AND CIRCUMSTANCES OF THE CASE. 2. THE LEARNED CIT(A) ERRED IN UPHOLDING THE ORDER FRAMED BY THE ASSESSING OFFICER WITHOUT PROVIDING P ROPER OPPORTUNITY OF BEING HEARD, SPECIALLY WHEN APPELLAN T WAS PREVENTED BY SUFFICIENT CAUSE IN MAKING THE COMPLIA NCE IN DEC. 2010. 3. THAT, WITHOUT PREJUDICE TO THE ABOVE AND IN THE ALTERNATIVE, THE LEARNED CIT(A) FAILED TO APPRECIAT E THE FACT THAT, INCOME IS DECLARED IN TERMS OF HIGHER SURREND ER MADE ON 21.11.06 DURING THE COURSE OF SEARCH, AS DESIRED BY THE AUTHORITIES AND AS PER THE ORAL ASSURANCE OF THE AU THORITIES, AND SHEERLY TO FULFILL THE COMMITMENT ASSESSEE MET WITH THE A.O. BEFORE FILING THE RETURN AND ULTIMATELY FI LED THE SAME AFTER GETTING ASSURANCE FROM HIM SUBJECT TO PA YMENT OF TAXES ON THE SURRENDERED AMOUNT WHICH SCARED ASS ESSEE DEPOSITED WITH ALL THE DIFFICULTIES BUT STILL HUGE ADDITION IS MADE WHICH IS NOT ONLY AGAINST THE SPIRIT OF AGREEM ENT REACHED BUT IS ALSO AGAINST THE PUBLIC POLICY. ITA-1742/DEL/2011 2 4. THAT, WITHOUT PREJUDICE TO THE ABOVE AND IN THE ALTERNATIVE, THE LEARNED CIT(A) FAILED TO APPRECIAT E THE FACT THAT, A.O. ERRED IN MAKING ADDITION OF RS.9,92,159/ - U/S 69/69A, BEING CASH DEPOSITED IN THE BANK, MERELY IN THE ABSENCE OF PRODUCTION OF ACCOUNTS WHILE COMPUTER CONTAINING ACCOUNTS IS SEIZED BY THE DEPTT., AND ON DEMANDING THE SAME DATA IS STATED TO BE CORRUPT, BE SIDE HE ALSO ERRED IN NOT APPRECIATING THE FACT THAT NEI THER A SINGLE EVIDENCE WAS FOUND AGAINST THE ASSESSEE NOR HIS EXPLANATION/NATURE OF BUSINESS WAS CONSIDERED. 5. THAT, THE LEARNED CIT(A) ALSO ERRED IN SUSTAININ G THE SAID ADDITION OF RS.1,49,635/- WITHOUT APPRECIATING THE FACT THAT NOT EVEN A SINGLE EVIDENCE WAS FOUND AGAINST T HE ASSESSEE AND ALSO THE SAME WAS MADE WITHOUT APPRECIATING THE NATURE OF BUSINESS. 2. GROUND NO.1 IS GENERAL. 3. AS PER GROUND NO.2, THE LEARNED CIT(A) ERRED IN UPHOLDING THE ORDER FRAMED BY THE AO WITHOUT PROVIDING PROPER OPP ORTUNITY OF HEARING TO THE ASSESSEE, PARTICULARLY WHEN THE ASSE SSEE WAS PREVENTED BY SUFFICIENT CAUSE IN MAKING THE COMPLIANCE IN DEC EMBER, 2010. 4. THE LEARNED CIT(A) DISMISSED THE APPEAL OF THE A SSESSEE, OBSERVING THAT NUMEROUS INSTANCES OF NON-COMPLIANCE ON THE PART OF THE ASSESSEE SHOWED THAT THE ASSESSEE WAS NOT INTER ESTED IN PURSUING THE APPEAL. 5. BEFORE US, THE LEARNED COUNSEL FOR THE ASSESSEE HAS CONTENDED THAT ON 15.12.2010, SHRI MAHENDRA KUMAR GUPTA, DIRE CTOR OF THE ASSESSEE COMPANY, HAD APPEARED IN THE OFFICE OF THE LEARNED CIT(A) AND HAD REQUESTED TO ALLOW TIME BY ADJOURNING THE M ATTER TO SOME TIME AFTER AROUND 10/15.1.2011, AS THE COUNSEL FOR THE ASSESSEE WAS BUSY IN SOME URGENT TIME BARRING RAID/OTHER ASSESSM ENTS; THAT HOWEVER, THE MATTER WAS ADJOURNED FOR 31.12.2010 AN D SHRI D.N.SHUKLA ITA-1742/DEL/2011 3 [PA OF LEARNED CIT(A)] COMMUNICATED THAT THE COUNSE L FOR THE ASSESSEE MAY COME FOR HEARING AFTER 15.1.2011 WITH PRIOR CON FIRMATION AND IT WAS ASSURED THAT THE APPEAL WILL NOT BE DISMISSED W ITHOUT HEARING AND THAT THE APPEAL HAD TO BE HEARD IN JANUARY, 2011 AN D NO FURTHER TIME WOULD BE ALLOWED; THAT SHRI MAHENDRA KUMAR GUPTA CO NTACTED SHRI SHUKLA FOR CONFIRMATION AROUND 11/12.1.2011 TO ATTE ND THE HEARING WITH THE COUNSEL; THAT SHRI SHUKLA ASKED TO CONTACT IN THE NEXT WEEK; THAT HOWEVER, WHEN SHRI MAHENDRA KUMAR GUPTA CONTAC TED AGAIN ON 17/18.1.2011, SHRI SHUKLA STATED THAT THE MATTER HA D ALREADY BEEN DISPOSED OF; THAT THE REASON FOR NON-APPEARANCE OF SHRI MAHENDRA KUMAR GUPTA BEFORE THE LEARNED CIT(A) ON THE EARLIE R OCCASION WAS THAT THE NOTICES HAD BEEN SENT TO HIS RESIDENTIAL A DDRESS, THE NOTICES WERE RECEIVED IN HIS ABSENCE AND HE DID NOT GET TIM ELY INFORMATION WITH REGARD THERETO AS HIS WIFE WAS NOT VIGILANT; T HAT IT WAS FOR THIS REASON THAT SHRI GUPTA HAD SPECIFICALLY ASKED THE C OUNSEL TO GIVE HIS ADDRESS FOR SENDING THE NOTICES; AND THAT HOWEVER, DUE TO THE SAID DEFAULTS, AS ADVISED, SHRI GUPTA USED TO KEEP IN TO UCH WITH THE OFFICE OF THE LEARNED CIT(A). 6. THE ABOVE AVERMENTS HAVE ALSO BEEN DEPOSED BY WA Y OF AN AFFIDAVIT BY SHRI MAHENDRA KUMAR GUPTA, WHICH AFFID AVIT HAS BEEN FILED BEFORE US. BESIDES, AN AFFIDAVIT OF SHRI AKHILESH KUMAR, ADVOCATE, THE LEARNED COUNSEL FOR THE ASSESSEE, HAS ALSO BEEN FIL ED, TO THE SAME EFFECT. 7. THE LEARNED COUNSEL FOR THE ASSESSEE HAS CONTEND ED THAT IN THE ABOVE CIRCUMSTANCES, THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE BEYOND ITS CONTROL FROM APPEARING BEFORE THE LEARNE D CIT(A) AND THAT AS SUCH, THE MATTER BE REMITTED TO THE FILE OF THE LEARNED CIT(A), FOR DECIDING IT AFRESH ON AFFORDING ADEQUATE OPPORTUNIT Y OF HEARING TO THE ASSESSEE. ITA-1742/DEL/2011 4 8. THE LEARNED DR, ON THE OTHER HAND, HAS SUBMITTED THAT IT WAS ON AS MANY AS TEN OCCASIONS THAT THERE WAS NON-COMPLIA NCE BEFORE THE LEARNED CIT(A), ON THE PART OF THE ASSESSEE, EITHER BY WAY OF NON- APPEARANCE OR BY SEEKING ADJOURNMENT; THAT THEREFOR E, THE LEARNED CIT(A) WAS JUSTIFIED IN DECIDING THE APPEAL OF THE ASSESSEE EX-PARTE QUA THE ASSESSEE. 9. WE HAVE HEARD THE PARTIES AND HAVE PERUSED THE M ATERIAL ON RECORD. THE LEARNED CIT(A) HAS DISMISSED THE APPEA L OF THE ASSESSEE BY MAKING THE FOLLOWING OBSERVATIONS:- 4. I HAVE GONE THROUGH THE GROUNDS OF APPEAL. NO WORTHWHILE FACTS ARE MENTIONED THEREIN WHICH WOULD LEAD ME TO UNDERSTAND THE GRIEVANCES ARISING THROUGH THE GROUNDS OF APPEAL. EVEN THOUGH, I AM NOT REQUIRED TO GIVE SEPARATE REASONS FOR AFFIRMING THE ORDER OF THE AO AS PER THE RATIO OF THE JUDGMENT OF THE CASE OF ANIL GOEL VS. CIT(APPEALS) & ANOTHER [2008], 306 ITR 212 (P&H). I HAVE CAREFULLY GONE THROUGH THE ASSESSMENT ORDER OF THE AO. I FIND THAT THE ADDITIONS HAVE BEEN MADE WITH DUE APPLICATION OF MIND. THE AOS ORDER IS, THEREFORE, CONFIRMED. 10. IT IS SEEN THAT IN VIEW OF WHAT HAS BEEN STATED BEFORE US BY WAY OF ARGUMENTS, THE AFFIDAVIT OF SHRI MAHENDRA KUMAR GUPTA, DIRECTOR OF THE ASSESSEE COMPANY AND THE AFFIDAVIT OF THE LEARN ED COUNSEL FOR THE ASSESSEE, THAT IT WAS SUFFICIENT CAUSE WHICH PREVEN TED THE ASSESSEE FROM APPEARING BEFORE THE LEARNED CIT(A) ON THE FIN AL DATE OF HEARING. ON THE EARLIER DATES, THE NON-APPEARANCE WAS DUE TO THE REASON OF NON-COMMUNICATION OF THE NOTICES OF HEARING TO SHRI GUPTA BY HIS WIFE. EVEN OTHERWISE, THE APPEAL BEFORE THE LEARNED CIT(A ) HAVING BEEN FILED BY THE ASSESSEE, IT DOES NOT STAND TO REASON THAT T HE ASSESSEE WOULD GAIN ANYTHING BY NOT PUTTING IN APPEARANCE BEFORE T HE LEARNED CIT(A). ITA-1742/DEL/2011 5 11. THE LEARNED CIT(A), ON THE OTHER HAND, WHILE DI SMISSING THE APPEAL, HAS NOT DEALT WITH THE MERITS OF THE CASE A T LENGTH AND IT HAS JUST BEEN HELD THAT ON GOING THROUGH THE ASSESSMENT ORDER, HE FOUND THAT THE ADDITIONS HAD BEEN MADE WITH DUE APPLICATI ON OF MIND. THIS, EVIDENTLY, DOES NOT AMOUNT TO A SPEAKING ORDER. FU RTHER, WHILE OBSERVING THAT HE WAS NOT REQUIRED TO GIVE SEPARATE REASONS FOR AFFIRMING THE ORDER OF THE AO, THE LEARNED CIT(A) H AS SOUGHT TO PLACE RELIANCE ON ANIL GOEL VS. CIT(APPEALS) & ANOTHER, 306 ITR 212 (P&H). HOWEVER, IT IS NOT APPLICABLE HERETO AS THEREIN, TH E ASSESSEE WAS FOUND TO HAVE NO JUSTIFIABLE REASON FOR BEING GRANTED ADJ OURNMENT. THE SAME IS NOT THE CASE HERE, IN FACTS AND CIRCUMSTANCES DI SCUSSED HEREINABOVE, AS SUPPORTED BY THE AFFIDAVITS FILED. 12. IN VIEW OF THE ABOVE, FINDING THAT THE ASSESSEE HAS BEEN DEPRIVED OF PROPER OPPORTUNITY OF HEARING, THEREBY VISITING IT WITH PREJUDICE, WE REMIT THIS MATTER TO THE FILE OF THE LEARNED CIT(A), TO BE DECIDED DE-NOVO IN ACCORDANCE WITH LAW, ON AFFORDIN G ADEQUATE AND PROPER OPPORTUNITY OF HEARING TO THE ASSESSEE. THE ASSESSEE, NO DOUBT, SHALL COOPERATE IN THE FRESH PROCEEDINGS BEF ORE THE LEARNED CIT(A). 13. IN THE RESULT, FOR STATISTICAL PURPOSES, THE AP PEAL OF THE ASSESSEE IS TREATED AS ALLOWED. DECISION PRONOUNCED IN THE OPEN COURT ON CONCLUSION OF HEARING ON 9 TH JUNE, 2011. SD/- SD/- (G.E.VEERABHADRAPPA) (G.E.VEERABHADRAPPA) (G.E.VEERABHADRAPPA) (G.E.VEERABHADRAPPA) (A.D.JAIN) (A.D.JAIN) (A.D.JAIN) (A.D.JAIN) VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT JUDICI JUDICI JUDICI JUDICIAL MEMBER AL MEMBER AL MEMBER AL MEMBER DATED : 09.06.2011. VK. ITA-1742/DEL/2011 6 COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR