Shri Vinodbhai Naranbhai Vaghani, Ahmedabad V. The Income Tax Officer, Ward-7(2), Ahmedabad

ITA 1753/AHD/2014

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 9070 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 9 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-03-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 02-03-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 06-06-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: N C AMIN
• Keywords: Principle of natural justice
• Section: 144

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD .., , BEFORE SHRI S.S. GODARA, JUDICIAL MEMBER AND SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER ./ I.T.A. NO.1753/AHD/2014 ( / ASSESSMENT YEAR : 2008-09) SHRI VINODBHAI NARANBHAI VAGHANI A-4-201 SPRING PARK RAMDEVNAGAR ROAD SATELLITE AHMEDABAD-380 005 / VS. THE ITO WARD-7(2) 502/B, PRATYAKSHAR BHAVAN NR.PANJARA POLE AHMEDABAD $ ./ ./ PAN/GIR NO. : AEQPV 7779 P ( $' / APPELLANT ) .. ( ($' / RESPONDENT ) $') / APPELLANT BY : MR. N.C. AMIN, AR ($'*) / RESPONDENT BY : MR. PRASOON KABRA, SR.DR +,*- / DATE OF HEARING 02/03/2017 ./0*- / DATE OF PRONOUNCEMENT 08/ 03/2017 / O R D E R PER PRADIP KUMAR KEDIA, AM: THE CAPTIONED APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS)-XIV, AHM EDABAD [CIT(A) IN SHORT] DATED 26/03/2014 FOR THE ASSESSMENT YEAR (AY) 2008-09. ITA NO.1753/AHD /2014 SHRI VINODBHAI NARANBHAI VAGHANI VS. ITO ASST.YEAR 2008-09 - 2 - 2. THE ASSESSEE RAISED VARIOUS GROUNDS ASSAILING T HE ORDER OF THE CIT(A) WHICH READ AS UNDER:- 1. THAT THE LEARNED A.O. HAS PASSED ASSESSMENT OR DER U/S 144 ON 30.11.2010 ASSESSING THE INCOME AT RS.32,37,070/- A S AGAINST RETURNED INCOME OF RS.84,000/- AND IN APPEAL THE LEARNED CIT (A) HAS DETERMINED INCOME OF THE APPELLANT AT RS.5,45,000/- BY PASSING APPELLATE ORDER DATED 26.3.2014. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE OF THE APPELLANT, THE CASH DEPOSITED OF RS.2,13,000/- IN BANK ACCOUNT WITH IDB I BANK LTD., IS NOT BY THE APPELLANT AND CONSIDERING THE MATERIALS AVAI LABLE ON RECORD, THE ADDITIONS DESERVES TO BE DELETED. 3. THAT THE LEARNED CIT(A) HAS FURTHER ERRED IN M AKING AN ADDITION OF RS.1,75,000/- BEING AMOUNT OF CASH BALANCE MERELY C ONSIDERING THE SAME SHOWN IN RETURN OF INCOME FOR THE ASSESSMENT Y EAR UNDER CONSIDERATION BUT NOT APPRECIATED THE FACTS THAT TH E APPELLANT IS ASSESSED TO INCOME-TAX SINCE LAST MANY YEARS AND AG ED ABOUT 41 YEARS AND CONSIDERING THE SAME, THE ADDITIONS OF RS.1,75, 000/- BEING CASH ON HAND DESERVES TO BE DELETED. 4. THAT THE LEARNED CIT(A) HAS FURTHER ERRED IN E STIMATING HOUSEHOLD EXPENDITURE OF RS.10,000/- P.M. WITHOUT CONSIDERING THAT THE APPELLANT'S STATUS, LIVING STANDARD AND FAMILY MEMBERS ARE RESI DING AT AHMEDABAD WITH HIS ELDER BROTHER SHRI MOHANBHAI VAGHANI WHO I S A RETIRED GOVERNMENT EMPLOYEE AND THE APPELLANT IS RESIDING W ITH HIS BROTHER AT SURAT AND CONSIDERING THESE FACTS ALSO, THE HOUSEHO LD EXPENDITURE ESTIMATED BY LEARNED A.O. AT RS.1,20,000/- PER YEAR WITHOUT ANY BASE DESERVES TO BE REDUCED TO A VERY REASONABLE AMOUNT. 5. HAVING REGARD TO THE FACTS AND CIRCUMSTANCES O F THE CASE OF THE APPELLANT, THE SHORT TERM CAPITAL GAIN OF RS.1,22,1 99/- ASSESSED BY LEARNED CIT(A) INSTEAD OF RS.1,12,199/-WORKED OUT O N PAGE 11 OF THE APPELLATE ORDER AND FURTHER THE SAME IS REQUIRED TO BE ADJUSTED AGAINST OTHER LOSSES INCURRED BY THE APPELLANT DURING THE Y EAR UNDER CONSIDERATION AS PER THE PROVISIONS OF THE ACT. ITA NO.1753/AHD /2014 SHRI VINODBHAI NARANBHAI VAGHANI VS. ITO ASST.YEAR 2008-09 - 3 - 6. HAVING REGARD TO THE PECULIAR FACTS AND CIRCUM STANCES OF THE CASE OF THE APPELLANT, THE LEARNED CIT(A) ASSESSED INCOME A T RS.5,45,000/- DESERVES TO BE MODIFIED 7. YOUR APPELLANT CRAVES LEAVE TO ADD, ALTER OR AM END ANY OF THE GROUNDS TILL THE APPEAL IS FINALLY HEARD AND DECIDE D. 3. AT THE OUTSET, LD.AR FOR THE ASSESSEE MR.N.C. AM IN SUBMITTED THAT ALL THESE GROUNDS EMANATE ON ACCOUNT OF ENHANCEMENT ACTION BY THE CIT(A) IN TERMS OF HIS CO-TERMINUS POWER. THE LD.A R FURTHER STATED IN ELABORATION THAT NONE OF THESE ISSUES ARE ARISING F ROM THE ASSESSMENT ORDER. THE LD.AR CONTENDED THAT NO ENHANCEMENT NOT ICE WAS ISSUED AND SERVED ON THE ASSESSEE BY THE CIT(A) WHILE INVOKING ITS POWER UNDER S.251(1)(A) OF THE INCOME TAX ACT, 1961 (HEREINAFTE R REFERRED TO AS 'THE ACT'). THE LD.AR ACCORDINGLY SUBMITTED THAT THE AC TION OF THE CIT(A) GROSSLY OFFENDS THE PRINCIPLE OF NATURAL JUSTICE AS SPELT IN SECTION 251(2) OF THE ACT. 4. WE STRAIGHT AWAY AGREE WITH THE CONTENTIONS RAIS ED ON BEHALF OF THE ASSESSEE. SECTION 251(2) PROVIDES THAT THE COM MISSIONER (APPEAL) SHALL NOT EMBARK ON ENHANCEMENT OF AN ASSESSMENT UN LESS THE ASSESSEE HAS BEEN GRANTED A REASONABLE OPPORTUNITY OF SHOWIN G CAUSE AGAINST SUCH ENHANCEMENT. WE FIND NO REFERENCE TO THE ISSUANCE OF ENHANCEMENT NOTICE IN THE APPELLATE ORDER OF THE CIT(A). OSTEN SIBLY, POWERS CONFERRED UNDER S.251(1)(A) OF THE ACT HAS BEEN EXERCISED WIT HOUT FOLLOWING THE DUE PROCEDURE MANDATED IN THE SECTION ITSELF. THE ACTION OF ENHANCEMENT ITA NO.1753/AHD /2014 SHRI VINODBHAI NARANBHAI VAGHANI VS. ITO ASST.YEAR 2008-09 - 4 - BY THE CIT(A) IS THUS UNSUSTAINABLE IN LAW AND IS T HEREFORE REQUIRED TO BE SET ASIDE. THE MATTER IS THEREFORE RESTORED BACK T O THE FILE OF THE CIT(A) FOR FRESH DETERMINATION AFTER GIVING PROPER OPPORTU NITY TO THE ASSESSEE IN TERMS OF SECTION 251(2) OF THE ACT. 4. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. THIS ORDER PRONOUNCED IN OPEN COURT ON 08 / 03 /2017 SD/- SD/- (..) ( ) ( S.S. GODARA ) ( PRADIP KUMAR KEDIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 08/ 03 /2017 4..+,.+../ T.C. NAIR, SR. PS !'#$%$' / COPY OF THE ORDER FORWARDED TO : 1. $' / THE APPELLANT 2. ($' / THE RESPONDENT. 3. 567- 8- / CONCERNED CIT 4. 8- ( ) / THE CIT(A)-XIV, AHMEDABAD 5. 9:-+67 , 670 , 5 / DR, ITAT, AHMEDABAD 6. <, / GUARD FILE. / BY ORDER, (9-- //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD