Dinesh Kumar, Sonepat V. ITO, Sonepat

ITA 1830/DEL/2016

• Counselvise Citation: [2019] 114 COUNSELVISE.COM (IT) 6224 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 7 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-11-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2010-2011
• Appeal Filed On: 07-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Reopening of assessment; Business income; Opportunity of being heard; Revised return; Reason to believe; Set aside
• Section: 148; 28

Judgement Text

SHRI DINESH KUMAR VS. ITO, WARD NO.2, SONIPAT, HARYANA/ITA NO.1830/DEL/2016 FOR A.Y. 2010-11 PAGE 1 OF 6 , ' , IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES F, NEW DELHI BEFORE MS.SUCHITRA KAMBLE, JUDICIAL MEMBER AND SHRI O.P.MEENA, ACCOUNTANT MEMBER . . ./ I.T.A NO.1830/DEL/2016 / ASSESSMENT YEAR: 2010-11 SHRI DINESH KUMAR, S/O. SHRI HARPHOOL SINGH, VILLAGE CHITANA DISTT., SONEPAT. [PAN: BEHPK 2605 D] VS . THE INCOME TAX OFFICER, WARD NO.2, SONEPAT. / APPELLANT /RESPONDENT /ASSESSEE BY SHRI R.K.VASHISHTHA ADV. /REVENUE BY SHRI S.N.MEENA SR.DR / DATE OF HEARING: 19.11.2019 /PRONOUNCEMENT ON: 19.11.2019 /O R D E R PER O.P.MEENA, AM: 1. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LD.COMMISSIONER OF INCOME TAX(APPEALS), ROHTAK DATED 15.01.2016 FOR THE ASSESSMENT YEAR 2010-11. 2. THOUGH, THE ASSESSEE HAS TAKEN AS MANY AS 15 GROUNDS OF APPEAL, HOWEVER THE MAIN GRIEVANCE IS AGAINST THE ILLEGALLY ESTIMATING THE INCOME OF RS.78,60,221/- AS AGAINST THE GROSS RECEIPT OF RS.36,11,270/- AND ILLEGALLY REOPENED THE ASSESSMENT U/S.148 ON THE GROUND THAT MATERIAL FOR REASON TO BELIEVE WAS GATHERED AT THE BACK OF SHRI DINESH KUMAR VS. ITO, WARD NO.2, SONIPAT, HARYANA/ITA NO.1830/DEL/2016 FOR A.Y. 2010-11 PAGE 2 OF 6 THE APPELLANT WHICH WAS NEITHER DISCLOSED NOR REPUDIATED TO THE APPELLANT BY THE AO, THEREFORE, REOPENING OF ASSESSMENT IS VOID AND ILLEGAL AND UNWARRANTED AND THE ASSESSEE IS NOT MAINTAINING ANY BOOKS OF ACCOUNTS AS HE HAS DECLARED HIS INCOME U/S.44AF AND 44AE OF THE ACT THEREBY TAKING 8% PROFIT ON THE TOTAL GROSS RECEIPT OF THE RS.36,11,270/- WHICH HAS ALREADY BEEN DECLARED BY THE APPELLANT IN HIS RETURN IN RESPONSE TO NOTICE U/S.147 OF THE ACT. 3. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE ASSESSEE IS ENGAGED IN THE OCCUPATION OF PLYING OF A TRUCK ON HIRE BASIS AND ALSO SOME SALE AND PURCHASE OF SAND. THE CASE WAS REOPENED U/S.147 OF THE ACT BY RECORDING REASONS IN WRITING AS THE ASSESSEE HAS MADE TRANSACTION OF RS.89,76,221/- IN THE ASSESSMENT YEAR UNDER APPEAL IN HIS BANK ACCOUNT WITH OBC EITHER THROUGH CASH OR CHEQUE. THE ASSESSEE HAS DECLARED IN THE REVISED RETURN GROSS RECEIPT AT RS.36,11,270/- WHEREAS IN THE ORIGINAL RETURN, THESE RECEIPTS WERE AT RS.13,16,450/-. NOTICE U/S.147 WAS ISSUED ON 25.05.2012 CALLING FOR THE RETURN OF INCOME FROM THE ASSESSEE IN RESPONSE TO WHICH A REVISED RETURN OF INCOME WAS FILED ON 28.10.2013 THEREAFTER NOTICE U/S.143(2) WAS ISSUED. THE AO NOTICED THAT THE ASSESSEE HAS SHOWN INCOME AT RS.42,000/- U/S.44AE OF THE ACT FROM PLYING ONE TRUCK. BESIDES THIS, THE ASSESSEE HAS ALSO SHOWN INCOME FROM GROSS RECEIPTS OF RS.36,11,270/- FROM SUPPLY OF SAND U/S.44AF OF THE ACT AND DECLARED PROFIT @5% AT RS.1,35,422/-. SHRI DINESH KUMAR VS. ITO, WARD NO.2, SONIPAT, HARYANA/ITA NO.1830/DEL/2016 FOR A.Y. 2010-11 PAGE 3 OF 6 AS THE AO NOTED THAT THE GROSS RECEIPTS OF THE ASSESSEE WERE AT RS.89,76,221/- WHEREAS THE TOTAL RECEIPTS SHOWN AT RS.13,16,450/-, HENCE DIFFERENCE OF RS.76,59,771/- WERE SHOWN LESS BY THE ASSESSEE AND THE SAME WAS ADDED TO THE TOTAL INCOME OF THE ASSESSEE. BESIDES, THE A.O. WAS ALSO MADE ADDITION ON THE RETURN OF INCOME AS WELL AS INCOME FROM TRUCK PLYING OF RS.42,000/-. 4. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) WHO HAVE UPHELD THE ACTION OF THE A.O. BY OBSERVING THAT THE ASSESSEE HAS NOT MADE ANY EFFORT TO FURNISH DETAILS OF BUSINESS AS ASKED FOR BY THE A.O. THE FACT REMAINS THAT THE APPELLANT HAD ORIGINALLY STATED THAT HE HAD MAINTAINED BOOKS OF ACCOUNTS IN HIS ORIGINAL RETURN OF INCOME AND THAT IN THE REVISED RETURN FILING IN RESPONSE TO NOTICE U/S.148, NO BOOKS OF ACCOUNTS BEING MAINTAINED. THERE HAS BEEN NO EFFORT, WHATSOEVER TO CORRELATE THE DEPOSITS WITH THE BUSINESS OPERATIONS, HENCE THE A.O.S ACTION OF MAKING THE ADDITION OF RS.76,59,771/- WAS JUSTIFIED AND THE APPELLANT WAS DISMISSED. 5. BEING AGGRIEVED, THE ASSESSEE FILED APPEAL BEFORE THIS TRIBUNAL. THE LD.COUNSEL SUBMITTED THAT THE A.O. WAS NOT JUSTIFIED IN REOPENING OF ASSESSMENT AND CONSIDERING THE TOTAL BUSINESS RECEIPTS DEPOSITED IN THE BANK ACCOUNT FOR MAKING ADDITION THOUGH SAME WERE RELATED TO BUSINESS OF WHICH INCOME HAS BEEN DISCLOSED BY THE ASSESSEE SHRI DINESH KUMAR VS. ITO, WARD NO.2, SONIPAT, HARYANA/ITA NO.1830/DEL/2016 FOR A.Y. 2010-11 PAGE 4 OF 6 U/S.44AE AND 44AF OF THE ACT. IT WAS ALSO SUBMITTED THAT THE ASSESSEE HAS ONLY ONE TRUCK, THEREFORE IT IS NOT POSSIBLE TO EARN HUGE INCOME AND EARN INCOME OF RS.76,59,771/-. FURTHER, THE ISSUE OF REOPENING HAS NOT BEEN PROPERLY ADJUDICATED BY THE AUTHORITIES BELOW. THE LD.COUNSEL ALSO CITED A DECISION OF ITAT SMC BENCH IN THE CASE OF ASSESSEE FOR A.Y.2009-10 IN ITA NO.1829/DEL/2016 DATED 04.05.2017 IN WHICH THE ISSUE WAS SET-ASIDE TO THE FILE OF THE LD. CIT(A). 6. PER CONTRA, THE LD.SENIOR DEPARTMENTAL REPRESENTATIVE RELIED UPON THE ORDERS OF AUTHORITIES BELOW AND SUBMITTED THAT THE ASSESSEE HAS SHOWN TURNOVER OF RS.13,54,422/- IN THE ORIGINAL RETURN INCOME WHEREAS IN THE REVISED RETURN THE ASSESSEE HAS SHOWN THE TOTAL GROSS RECEIPTS AT RS.36,11,270/-. BOTH FIGURES ARE NOT CORRECT AS THE TOTAL CASH AND CHEQUE DEPOSITS IN THE BANK ACCOUNT DURING THE YEAR UNDER CONSIDERATION WERE AT RS.89,76,221/-. FURTHER, THE CONTENTION OF THE LD.COUNSEL THAT THE ASSESSEE IS PLYING ONLY ONE TRUCK IS INCORRECT AS THE ASSESSEE IS ALSO EARNING INCOME FROM SAND. FURTHER, THE ASSESSEE HAS NOT FURNISHED ANY EVIDENCE BEFORE THE LD. CIT(A) NOR BEFORE THE A.O., THEREFORE THE APPEAL WAS RIGHTLY DISMISSED. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT ON SAME SET OF ISSUE AND IDENTICAL FACTS FOR A.Y.2009-10, THE TRIBUNAL IN THE CASE OF ASSESSEE HIMSELF IN SHRI DINESH KUMAR VS. ITO, WARD NO.2, SONIPAT, HARYANA/ITA NO.1830/DEL/2016 FOR A.Y. 2010-11 PAGE 5 OF 6 ITA NO.1829/DEL/2016 DATED 04.05.2017 HAS SET-ASIDE THE ISSUE TO THE FILE OF THE LD. CIT(A) WITH FOLLOWING OBSERVATIONS: 8. I HAVE CONSIDERED RIVAL SUBMISSIONS AND MATERIAL ON RECORD. THE RECORD REVEALED THAT AO ISSUED DETAILED QUESTIONNAIRE TO THE ASSESSEE AND ASSESSEE FILED DETAILED REPLY TO THE AO. THE AO ISSUED NOTICE UNDER SECTION 148 ON 25 TH MAY, 2012, HOWEVER ASSESSEE FILED RETURN OF INCOME IN RESPONSE TO NOTICE UNDER SECTION 148 ON 28 TH OCTOBER, 2013. THE RETURN OF INCOME WAS THEREFORE BELATED WHICH HAVE BEEN RIGHTLY IGNORED BY THE AUTHORITIES BELOW. HOWEVER, THE FACT REMAINED THAT ALL THE POINTS RAISED BY THE ASSESSEE BEFORE LEARNED CIT(A) HAVE NOT BEEN PROPERLY ADJUDICATED BY THE LEARNED CIT(A). IT APPEARS FROM THE ORDER OF THE CTT(A) THAT THE LEARNED CIT(A) REPRODUCED THE SUBMISSIONS OF THE ASSESSEE IN THE IMPUGNED ORDER ON ALL THE POINTS AND THEREAFTER REPRODUCED THE FINDINGS OF THE AO AND WITHOUT PASSING ANY REASONED ORDER DISMISSED ALL THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE. SUCH A COURSE IS NOT PERMISSIBLE IN LAW. THE LEARNED OIT(A) DID NOT PASS THE REASONED ORDER AND HAS NOT GIVEN ANY REASONS FOR HIS DECISION IN THE IMPUGNED ORDER. THE LEARNED CIT(A) MERELY AGREED WITH THE FINDINGS OF THE AO. THE LEARNED CIT(A) DID NOT CONSIDER THAT ASSESSEE HAS GIVEN REASONS FOR TWO DIFFERENT TRUCK NUMBERS WHICH COULD BE VERIFIED FROM THE REGISTRATION AUTHORITY AS WELL AS FROM THE FINANCER. THE ASSESSEE HAS BEEN PLEADING BEFORE THE AUTHORITIES BELOW THAT HE OWNED ONLY ONE TRUCK AND WAS SUPPLYING SAND TO VARIOUS PERSONS. THE ASSESSEE ALSO PLEADED THAT HIS CASE FALLS IN SECTION 44AE AND SECTION AF THEREFORE FOR HOLDING ONE TRUCK, IT IS DIFFICULT TO BELIEVE THAT ASSESSEE WOULD EARN HUGE INCOME OF ABOUT RS. 40,00,000/-. MAY BE THE ASSESSEE HAS NOT PRODUCED SOME EVIDENCE BEFORE THE AUTHORITIES BELOW BUT IT WOULD NOT BE PERMISSIBLE THAT AUTHORITIES BELOW SHOULD ACT IN HASTE WITHOUT CONSIDERING THE EXPLANATION OF THE ASSESSEE AND MADE HIGH PITCHED ASSESSMENT. ACCORDING TO SECTION 250(6) OF ACT LEARNED CIT(A) IS REQUIRED TO PASS THE REASONED ORDER GIVING REASONS FOR THE DECISIONS IN THE IMPUGNED ORDER. AS NOTED, THE LEARNED CIT(A) REPRODUCED THE FINDINGS OF THE AO AND SUBMISSIONS OF THE ASSESSEE AND MERELY AGREED WITH THE FINDINDS OF THE A.O. WITHOUT GIVING REASONS FOR THE DECISION IN THE APPELLATE ORDER. THE ENTIRE MATTER THEREFORE REQUIRES RECONSIDERATION AT THE LEVEL OF THE LEARNED CIT(A). 9. IN THIS VIEW OF THE MATTER, I SET ASIDE THE ORDER OF THE LEARNED CIT(A) AND RESTORE THE APPEAL OF ASSESSEE TO HIS FILE WITH DIRECTION TO REDECIDE APPEAL OF ASSESSEE BY GIVING REASONABLE SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE LEARNED CIT(A) SHALL PASS A SPEAKING ORDER GIVING INDEPENDENT REASONS FOR DECISION IN THE IMPUGNED ORDER. THE LEARNED CIT(A) SHALL ALSO DETERMINE WHETHER PROVISIONS OF SECTION 44AE AND 44AF HAVE APPLICABILITY TO THE FACTS AND THE CIRCUMSTANCES OF THE CASE. IN CASE THESE PROVISIONS ARE ATTRACTED IN THE CASE OF ASSESSEE, WHETHER THE OTHER ADDITIONS OF THE NATURE AS MENTIONED ABOVE WOULD BE RELEVANT TO BE ADDED. IN CASE ANY NEED ARISES, LEARNED CIT(A) MAY CALL FOR THE REMAND REPORT FROM THE AO AND THEN SHALL PASS THE ORDER IN ACCORDANCE WITH LAW, CONSIDERING THE EXPLANATION OF ASSESSEE AS REPRODUCED IN THE IMPUGNED ORDERS. SHRI DINESH KUMAR VS. ITO, WARD NO.2, SONIPAT, HARYANA/ITA NO.1830/DEL/2016 FOR A.Y. 2010-11 PAGE 6 OF 6 8. SINCE THE FACTS FOR THE ASSESSMENT YEAR UNDER CONSIDERATION ARE IDENTICAL, THEREFORE RESPECTFULLY FOLLOWING THE DECISION OF ITAT IN ASSESSEES OWN CASE IN THE PRECEDING ASSESSMENT YEAR THIS APPEAL IS ALSO SET-ASIDE TO THE FILE OF THE LD. CIT(A) WITH THE SAME DIRECTION AS CONTAINED IN PARA 9 OF THE ORDER OF THE TRIBUNAL IN THE CASE OF ASSESSEE AS MENTIONED ABOVE. 9. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. 10. ORDER PRONOUNCED IN THE OPEN COURT ON 19-11-2019. SD/- SD/- (SUCHITRA KAMBLE) (O.P.MEENA) ( /JUDICIAL MEMBER) ( /ACCOUNTANT MEMBER) / NEW DELHI , DATED : 19 TH NOVEMBER , 2019/ S.GANGADHARA RAO, SR.PS COPY OF ORDER SENT TO- ASSESSEE/AO/PR. CIT/ CIT (A)/ ITAT (DR)/GUARD FILE OF ITAT. BY ORDER / / TRUE COPY / / ASSISTANT REGISTRAR, NEW DELHI