JITENDRA SINGH SHAKHTAWAT, Ajmer V. ITO, Ajmer

ITA 189/JPR/2017

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 0122 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 9 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-12-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 06-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JAI SINGH JCIT DHK
• Assessee Lawyers: R S PUNIA
• Keywords: Principle of natural justice; Additional evidence; Reasonable cause; Reason to believe
• Section: 147; 27; 148; 144

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKWO] U;KF;D LNL; ,OA JH FOE FLAG ;K NO ] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM AND SHRI VIKRAM SING H YADAV, AM VK;DJ VIHY LA-@ ITA NO. 189/JP/2017 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2011-12. SHRI JITENDRA SINGH SHAKHTAWAT, S/O SHRI DEVRAJ SINGH SHAKHTAWAT, SAWAR FORT, SAWAR, TEHSL-KEKRI, AJMER. CUKE VS. THE INCOME TAX OFFICER, WARD 2(3), AJMER. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. DKLPS 3857 R VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT VK;DJ VIHY LA-@ ITA NO. 190/JP/2017 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2011-12. SHRI RAJDEEP SINGH SHAKHTAWAT, S/O SHRI JITENDRA SINGH SHAKHTAWAT, SAWAR FORT, SAWAR, TEHSL-KEKRI, AJMER. CUKE VS. THE INCOME TAX OFFICER, WARD 2(3), AJMER. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. BLXPS 9906 C VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI R.S. PUNIA (CA) JKTLO DH VKSJ LS@ REVENUE BY : SHRI JAI SINGH (JCIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 10.12.2018. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 12/12/2018. VKNS'K@ ORDER PER VIJAY PAL RAO, JM : THESE TWO APPEALS BY TWO ASSESSES WHO ARE FATHER AN D SON ARE ARISING FROM TWO SEPARATE ORDERS OF THE LD. CIT (A) BOTH DATED 4 TH JANUARY, 2017 FOR THE ASSESSMENT YEAR 2011-12. COMMON GROUNDS HAVE BEEN RAISED IN THESE APPEALS. THE GROUND RAISED IN THE APPEAL IN ITA NO. 189/JP/2 017 ARE REPRODUCED AS UNDER :- 2 ITA NO.S 189 & 190/JP/2017 SHRI JITENDRA SINGH SHAKHTAWAT & SHRI RAJDEEP SINGH SHAKHTAWAT. 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LEARNED CIT(A) HAS LEGALLY AND FACTUALLY ERRED IN DISMISSIN G APPELLANTS GROUND OF APPEAL CHALLENGING EX PARTE ASSESSMENT OR DER U/S 147/144 OF THE I.T. ACT, 1961 WITHOUT APPRECIATING THE FACT THAT THE APPELLANT WAS PREVENTED BY REASONABLE CAUSE FRO M MAKING THE REQUIRED COMPLIANCE OF THE STATUTORY NOTICES IS SUED TO HIM FROM TIME TO TIME. THUS, THE DECISION OF LD. CIT ( A) DISMISSING THIS GROUND OF APPEAL IS FACTUALLY AND LEGALLY INCO RRECT AND DESERVES TO BE QUASHED SUMMARILY. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LEARNED CIT (A) HAS LEGALLY AND FACTUALLY ERRED IN NOT ADMI TTING THE ADDITIONAL EVIDENCES FURNISHED BY THE APPELLANT UND ER RULE 46A OF THE I.T. RULES WITHOUT APPRECIATING THE FACTS OF THE CASE IN RIGHT PERSPECTIVE. DENIAL OF SUCH ADMISSION IS CON TRARY TO THE PRINCIPLES OF EQUITY & NATURAL JUSTICE AS THESE EVIDENCES GO DIRECTLY TO THE ROOT OF THE POINTS AT ISSUE TO BE D ECIDED ON MERITS IN THE BACK-GROUND OF SUCH ADDITIONAL EVIDENCES. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LEARNED AUTHORITIES BELOW HAVE LEGALLY AND FACTUALLY ERRED IN MAKING AND CONFIRMING THE ADDITION OF RS. 49,21,533/- (RS.49,0 9,000/- AS INCOME FROM OTHER SOURCES AND RS. 12,533/- AS INTER EST THEREON) WITHOUT APPRECIATING THE FACTS OF THE CASE IN RIGHT PERSPECTIVE. THUS, THE ADDITION SO MADE AND CONFIRMED BY AUTHORI TIES BELOW IS BAD IN LAW AND DESERVES TO BE DELETED SUMMARILY. 4. THE APPELLANT CRAVES TO ADD, AMEND OR WITHDRAW A NY OF THE GROUND OF APPEAL EITHER BEFORE OR AT THE TIME OF HE ARING OF APPEAL. THE ASSESSEES HAVE ALSO FILED AN APPLICATION RAISIN G ADDITIONAL GROUND IN BOTH THE CASES. THE ADDITIONAL GROUND SOUGHT TO BE RAISED B Y THE ASSESSEES READS AS UNDER :- UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE THE LEARNED A.O. HAS ERRED IN FACTS AND LAW IN INITIATING PROCEEDING U/S 147/148 WITHOUT HAVING SUFFICIENT REASONS TO BELIEVE, WITHOUT APPLI CATION OF MIND, WITHOUT EXAMINATION ABOUT CORRECTNESS OF THE INFORM ATION IN HIS POSSESSION FOR REOPENING THE CASE, WHICH IS ILLEGAL AND BAD IN LAW. SO KINDLY QUASH THE ENTIRE PROCEEDING AND ASSESSMENT O RDER ON THE BASIS OF A NOTICE WHICH IS ILLEGAL & BAD IN LAW. 3 ITA NO.S 189 & 190/JP/2017 SHRI JITENDRA SINGH SHAKHTAWAT & SHRI RAJDEEP SINGH SHAKHTAWAT. 2. THE LD. A/R OF THE ASSESSEE HAS SUBMITTED THAT T HE REOPENING OF THE ASSESSMENT IS NOT VALID AS THE AO HAS REOPENED THE ASSESSMENT IN BOTH THE CASES ON THE BASIS OF INFORMATION RECEIVED WITHOUT APPLICATI ON OF MIND AND WITHOUT EXAMINATION OF THE CORRECTNESS OF THE FACTS IN RESP ECT OF THE ALLEGED ESCAPED INCOME. IN SUPPORT OF HIS CONTENTION HE HAS RELIED UPON VAR IOUS DECISIONS WHEREIN IT HAS BEEN HELD THAT THE MERE DEPOSIT OF CASH IN THE BANK ITSE LF CANNOT BE A REASON TO BELIEVE THAT INCOME ASSESSABLE TO TAX HAS ESCAPED ASSESSMEN T, RATHER IT IS ONLY A REASON TO SUSPECT THAT THE DEPOSITS MADE IN THE BANK ACCOUNT MAY BE AN INCOME ESCAPED ASSESSMENT. THUS THE LD. A/R HAS SUBMITTED THAT TH E ADDITIONAL GROUND MAY BE ADMITTED AND THE REOPENING OF THE ASSESSMENT MAY BE QUASHED AS BAD IN LAW. 3. ON THE OTHER HAND, THE LD. D/R HAS SUBMITTED THA T THE ASSESSES HAVE NOT FILED ANY RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATI ON NOR ANY RETURN OF INCOME IN ANY OF THE ASSESSMENT YEARS PRIOR TO THE YEAR UNDER CONSIDERATION. FURTHER, EVEN IN RESPECT TO NOTICE UNDER SECTION 148 THE ASSESSEES H AVE NOT FILED ANY RETURN OF INCOME, THEREFORE, THE ASSESSEES CANNOT BE ALLOWED TO CHALLENGE THE VALIDITY OF NOTICE ISSUED UNDER SECTION 148 OF THE IT ACT. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD. THERE IS NO DISPUTE THAT THE ASSESSEES BEF ORE US NEVER FILED ANY RETURN OF INCOME AND THE INFORMATION WAS RECEIVED BY THE AO T HAT THE ASSESSEES HAVE DEPOSITED CASH IN THE BANK ACCOUNT TO THE TUNE OF R S. 45,16,000/- AND RS. 25,19,000/- RESPECTIVELY. ACCORDINGLY, THE AO INIT IATED THE PROCEEDINGS UNDER SECTION 147/148 BY ISSUING NOTICE UNDER SECTION 148 ON 27 TH JUNE, 2013 AFTER RECORDING THE REASONS. IN RESPONSE TO THE NOTICE U NDER SECTION 148, THE ASSESSEE 4 ITA NO.S 189 & 190/JP/2017 SHRI JITENDRA SINGH SHAKHTAWAT & SHRI RAJDEEP SINGH SHAKHTAWAT. DID NOT PREFER ANY RETURN OF INCOME AND CONSEQUENTL Y THE REASSESSMENTS WERE PASSED UNDER SECTION 144 READ WITH SEC. 147 OF THE IT ACT WHEREBY THE AMOUNTS FOUND DEPOSITED IN THE BANK ACCOUNT OF THE ASSESSEE S WERE ASSESSED AS TOTAL INCOME OF THE ASSESSEE. THE ASSESSEES CHALLENGED THE ACTI ON OF THE AO BEFORE THE LD. CIT (A) ON THE GROUND THAT THE ASSESSEES ARE HAVING VER Y LARGE CHUNKS OF AGRICULTURAL LANDS AND THE DEPOSITS MADE IN THE BANK ACCOUNT ARE FROM AGRICULTURAL INCOME OF THE ASSESSEES. THE LD. CIT (A) DID NOT ACCEPT THIS EXP LANATION OF THE ASSESSEES ON THE GROUND THAT THE ASSESSEES DID NOT PRODUCE ANY RECOR D IN SUPPORT OF EXPLANATION OF SOURCE OF DEPOSITS MADE IN THE BANK ACCOUNT. NOW T HE ASSESSEES HAVE RAISED THIS ADDITIONAL GROUND CHALLENGING THE VALIDITY OF NOTIC E UNDER SECTION 148 OF THE IT ACT. IT IS PERTINENT TO NOTE THAT THE VALIDITY OF NOTICE UNDER SECTION 148 CAN BE CHALLENGED AT THE INITIAL STAGE BY FILING THE WRIT PETITION BE FORE THE HONBLE HIGH COURT OR IT CAN BE OBJECTED BEFORE THE AO BY FILING THE OBJECTIONS AND THEN IN THE APPELLATE PROCEEDINGS. THE OBJECTIONS AGAINST NOTICE UNDER SE CTION 148 CAN BE FILED ONLY AFTER THE RETURN OF INCOME IN RESPONSE TO NOTICE UNDER SE CTION 148 IS FILED BY THE ASSESSEE. IN THE CASE IN HAND WHEN THE ASSESSEES HAVE NOT FIL ED ANY RETURN OF INCOME IN RESPONSE TO NOTICE UNDER SECTION 148 OF THE IT ACT, THEN THE ASSESSEES CANNOT RAISE AN OBJECTION AGAINST THE NOTICE ISSUED UNDER SECTIO N 148 OF THE ACT AS PER THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF GK N DRIVESHAFTS (INDIA) LTD. VS. ITO, 259 ITR 19 (SC). THERE IS NO QUARREL ON THE P OINT THAT A LEGAL ISSUE CAN BE RAISED AT THE APPELLATE STAGE AND BEFORE THIS TRIBU NAL IRRESPECTIVE OF THE FACT THAT THE SAME WAS NOT RAISED BEFORE THE AUTHORITIES BELOW. HOWEVER, SUCH A PLEA CAN BE RAISED BEFORE THE TRIBUNAL SUBJECT TO THE CONDITION THAT THE SAME OUGHT TO HAVE BEEN 5 ITA NO.S 189 & 190/JP/2017 SHRI JITENDRA SINGH SHAKHTAWAT & SHRI RAJDEEP SINGH SHAKHTAWAT. RAISED BY THE ASSESSEE BEFORE THE AUTHORITIES BELOW BUT COULD NOT BE RAISED DUE TO SOME BONAFIDE REASONS. ONCE A LEGAL PLEA RAISED BY THE ASSESSEE DOES NOT REQUIRE ANY INVESTIGATION OF NEW FACTS, THEN THE SAME CAN B E RAISED AT THIS STAGE. HOWEVER, THE PLEA OF CHALLENGING THE VALIDITY UNDER SECTION 148 CANNOT BE RAISED BEFORE THE AO DUE TO THE REASON THAT THE ASSESSEE DID NOT FILE RE TURN OF INCOME IN RESPONSE TO THE NOTICE UNDER SECTION 148. MOREOVER, THE ASSESSEE B EFORE US ALSO NOT FILED ANY RETURN OF INCOME UNDER SECTION 139(1) OF THE ACT. HENCE IN THE FACTS AND CIRCUMSTANCES OF THE CASE WHERE THE ASSESSEES HAVE NEITHER FILED ANY RETURN OF INCOME UNDER SECTION 139(1) NOR IN RESPONSE TO NOTICE UNDER SECTION 148, THEN THE ASSESSEE COULD NOT RAISE ANY OBJECTION BEFORE THE AO AGAINST THE NOTIC E UNDER SECTION 148 OF THE ACT AND CONSEQUENTLY THE SAID OBJECTION CANNOT BE RAISE D BEFORE THE APPELLATE AUTHORITY. HENCE, WE DECLINE TO ADMIT THE ADDITIONAL GROUND RA ISED BY THE ASSESSEE. THE SAME IS REJECTED. 5. AS REGARDS THE ORIGINAL GROUNDS RAISED BY THE AS SESSEE, ON THE MERITS OF THE ISSUE, THE LD. A/R OF THE ASSESSEE HAS SUBMITTED TH AT THE ASSESSEE PRODUCED ADDITIONAL EVIDENCE BEFORE THE LD. CIT (A) IN SUPPO RT OF SOURCE OF DEPOSITS MADE IN THE BANK ACCOUNT. THE LD. A/R HAS REFERRED TO THE RECORD WHICH SHOWS THAT THE LAND HOLDING OF THE ASSESSEES AS WELL AS AFFIDAVITS OF T HE ASSESSEES WHEREIN THE SOURCE OF DEPOSITS MADE IN THE BANK ACCOUNT HAS BEEN EXPLAINE D. THE LD. CIT (A) HAS NOT ADMITTED THE ADDITIONAL EVIDENCE FILED BY THE ASESS EE. THUS THE LD. A/R HAS SUBMITTED THAT THE ASSESSEES HAVE ALSO FILED AN APP LICATION FOR ADMISSION OF THE ADDITIONAL EVIDENCE ALONG WITH THE AFFIDAVITS OF TH E ASSESSEES AND PLEADED THAT THE 6 ITA NO.S 189 & 190/JP/2017 SHRI JITENDRA SINGH SHAKHTAWAT & SHRI RAJDEEP SINGH SHAKHTAWAT. ADDITIONAL EVIDENCE SOUGHT TO BE PRODUCED BY THE AS SESSEE MAY BE ADMITTED FOR VERIFICATION AND EXAMINATION AT THE END OF THE A.O. 6. ON THE OTHER HAND, THE LD. D/R HAS VEHEMENTLY OP POSED TO THE ADMISSION OF ADDITIONAL EVIDENCE AND SUBMITTED THAT THE ASSESSEE S DID NOT FILE ANY RETURN OF INCOME AND ALSO NOT APPEARED BEFORE THE AO DURING T HE ASSESSMENT PROCEEDINGS. THEREFORE, THE ASSESSEES WERE NEVER CO-OPERATIVE IN THE PROCEEDINGS BEFORE THE AO. HE HAS RELIED UPON THE ORDERS OF THE AUTHORITIES BE LOW. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD. WE NOTE THAT THE ASSESSEES ARE AGRICULTURIS TS BY OCCUPATION AND THERE IS NO RECORD OR ALLEGATION THAT THE ASSESSEES ARE DOING A NY OTHER ACTIVITIES OF GENERATING ANY INCOME. ONCE THE ASSESSEES ARE AGRICULTURISTS AND HOLDING A SUBSTANTIAL AMOUNT OF LAND IN THEIR PERSONAL NAMES AS WELL AS IN THE N AMES OF THE FAMILY MEMBERS, THEN THE ENTIRE DEPOSIT MADE IN THE BANK ACCOUNT CANNOT BE TREATED AS TAXABLE INCOME OF THE ASSESSEES. THE ASSESSEES FILED THE ADDITIONAL EVIDENCE IN THE SHAPE OF REVENUE RECORD SHOWING THE LAND HOLDING IN THE NAMES OF THE ASSESSEES AS WELL AS THEIR FAMILY MEMBERS. THE LAND HOLDING OF THE ASSESSEES ARE MORE THAN 16 HECTARES IN CASE OF THE FATHER AND ABOUT 6 HECTARES IN CASE OF SON. THEREFORE, WE FIND THAT THOUGH THE ASSESSEES DID NOT PRODUCE THESE EVIDENCE S BEFORE THE A.O, HOWEVER, ONCE THE EVIDENCES PRODUCED BY THE ASSESSEE IS THE OFFICIAL RECORD WHICH CAN BE INDEPENDENTLY VERIFIED, THEN THE SAME IS REQUIRED T O BE VERIFIED AND CONSIDERED FOR THE PURPOSE OF EXPLAINING THE SOURCE OF DEPOSITS MA DE IN THE BANK ACCOUNT. PRIMA FACIE, THE ASSESSEES HAVE SHOWN MORE THAN SUFFICIEN T LAND HOLDING IN SUPPORT OF THE AGRICULTURAL INCOME, HOWEVER, SINCE THE ADDITIONAL EVIDENCE WHICH WAS NOT PRODUCED 7 ITA NO.S 189 & 190/JP/2017 SHRI JITENDRA SINGH SHAKHTAWAT & SHRI RAJDEEP SINGH SHAKHTAWAT. BEFORE THE AO AND HAS NOT BEEN EXAMINED, THEREFORE, IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN THE INTEREST OF JUSTICE, WE ADMI T THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE AND REMIT THE MATTER TO THE RECORD OF THE AO FOR CONDUCTING A PROPER ENQUIRY IN RESPECT OF THE CLAIM OF LAND HOLDING AND AGRICULTURAL INCOME OF THE ASSESSEES TO EXPLAIN THE SOURCE OF DEPOSITS MADE IN THE BANK ACCOUNT. NEEDLESS TO SAY THAT THE ASSESSEES BE GIVEN AN APPROPRIATE OPPO RTUNITY OF HEARING BEFORE PASSING THE FRESH ORDER. 8. IN THE RESULT, APPEALS OF THE ASSESSEES ARE ALLO WED FOR STATISTICAL PURPOSES. ORDER IS PRONOUNCED IN THE OPEN COURT ON 12/12/20 18. SD/- SD/- ( FOE FLAG ;KNO ) ( FOT; IKY JKWO (VIKRAM SINGH YADAV ) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 12/12/2018. DAS/ VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- SHRI JITENDRA SINGH SHAKTAWAT, KE KRI AND SHRI RAJDEEP SINGH SHAKTAWAT, KEKRI. 2. THE RESPONDENT THE ITO, WARD 2(3), AJMER. 3. THE CIT(A). 4. THE CIT, 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO. 189 & 190/JP/2017) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR 8 ITA NO.S 189 & 190/JP/2017 SHRI JITENDRA SINGH SHAKHTAWAT & SHRI RAJDEEP SINGH SHAKHTAWAT.