ITO, Cuddalore V. Shri K.Mohan, Vriddhachalam

ITA 1937/CHNY/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1079 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-03-2013
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 07-03-2013
• Assessment Year: 2009-2010
• Appeal Filed On: 31-10-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: T VASUDEVAN
• Keywords: Depreciation; Additional evidence
• Section: 144

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL B BENCH, CHENNAI. BEFORE DR. O.K. NARAYANAN, VICE-PRESIDENT & SHRI S.S. GODARA, JUDICIAL MEMBER I.T.A. NO.1937/MDS/2012 ASSESSMENT YEAR : 2009-10 THE INCOME TAX OFFICER, WARDI(3), CUDDALORE. VS. SHRI K. MOHAN, 72, DEVANGUDI ROAD, KARUVEPPILANKURICHI, VRIDDHACHALAM. [PAN:AJCPM4273C] (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI GURU BASHYAM, JCIT RESPONDENT BY : SHRI T. VASUDEVAN, ADVOCATE DATE OF HEARING : 07 . 03 .201 3 DATE OF PRONOUNCEMENT : 11.03.2013 ORDER PER S.S. GODARA, JUDICIAL MEMBER THIS REVENUES APPEAL IS DIRECTED AGAINST THE ORDE R OF THE COMMISSIONER OF INCOME TAX (APPEALS) -XII, CHENNAI DATED 20.07.2012 IN ITA NO. 700/2011-12, IN PROCEEDINGS UNDER SECTION 1 43(3) OF THE INCOME TAX ACT 1961 [IN SHORT THE ACT]. 2. REFERRING TO THE GROUNDS RAISED IN THE APPEAL, THE REVENUE VEHEMENTLY ARGUES THAT THE CIT(A) HAS WRONGLY ALLOW ED ASSESSEES APPEAL AGAINST THE ASSESSMENT ORDER PASSED UNDER SECTION 1 44 OF THE ACT AND THAT TOO, BY ADMITTING ADDITIONAL EVIDENCE WITHOUT ISSUI NG ANY NOTICE TO THE ASSESSING OFFICER IN VIOLATION OF RULE 46A OF INCOM E TAX RULES. ACCORDINGLY, I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1937 1937 1937 1937/M/ /M/ /M/ /M/12 1212 12 2 IT PRAYS FOR ACCEPTANCE OF THE APPEAL. 3. OPPOSING THIS, THE ASSESSEE PLACES STRONG RELIA NCE ON THE ORDER OF THE CIT(A) UNDER CHALLENGE AND PRAYS FOR ITS CONFIRMATI ON. 4. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE I S AN INDIVIDUAL, ENGAGED IN THE BUSINESS OF CONTRACT WORK OF FORTIFICATION O F SHORELINES. ON 30.09.2009, HE HAD FILED HIS RETURN DECLARING TOTAL INCOME OF ` .5,68,340/- WHICH WAS SUMMARILY PROCESSED. 5. IN SCRUTINY PROCEEDINGS, THE ASSESSING OFFICE R ISSUED NOTICE TO THE ASSESSEE ASKING FOR EXPLANATION QUA SOURCE OF CASH DEPOSITS AMOUNTING TO MORE THAN ` .10.00 LAKHS IN HIS SAVING BANK ACCOUNT, DETAILS OF NATURE OF INVESTMENT & PAYMENT, BANK STATEMENTS, BUSINESS ACT IVITIES, RECORD OF VAT PROCEEDINGS, PARTICULARS OF ASSETS & DEPRECIATION E TC. AS THE ASSESSMENT ORDER REVEALS, THE ASSESSEE DID NOT RESPOND TO THE ASSESSING OFFICER WITH THE AFORESAID INFORMATION SOUGHT FOR PROMPTING HIM TO PROCEED EX-PARTE UNDER SECTION 144 OF THE ACT. ACCORDINGLY, HE PAS SED ASSESSMENT ORDER DATED 16.12.2011 HOLDING THEREIN THAT SINCE THE ASS ESSEE HAD FAILED TO FILE ALL PARTICULARS SOUGHT FOR IN SUPPORT TO THE CLAIM OF E XPENSES, ETC. HE COMPUTED THE TOTAL INCOME AS ` .81,00,551/- @ 8% OF THE GROSS CONTRACT RECEIPTS AMOUNTING TO ` .10,12,56,891/-. SIMILARLY, SINCE THE ASSESSEE HAD NOT EXPLAINED TH E SOURCE OF CASH DEPOSIT IN HIS BANK ACCOUNT OF ` .1,94,400/-, THE ASSESSING OFFICER TREATED THE AMOUNT AS UNEXPLAINED CASH INVESTMENT. IN THIS MANN ER, THE TOTAL INCOME OF I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1937 1937 1937 1937/M/ /M/ /M/ /M/12 1212 12 3 THE ASSESSEE STOOD COMPUTED TO ` .92,94,950/-. 6. AGGRIEVED THE ASSESSEE PREFERRED APPEAL. VIDE OR DER UNDER CHALLENGE, THE CIT(A) HAS ACCEPTED ASSESSEES CONTENTIONS AND IT HAS BEEN HELD THAT SINCE HE HAD DULY CONDUCTED REGULAR AUDIT UNDER SEC TION 44AB OF THE ACT, THEREFORE, THE ASSESSING OFFICER HAD WRONGLY ESTIMA TED THE INCOME IN THE ASSESSMENT ORDER. REGARDING OTHER ADDITIONS OF UNEX PLAINED CASH INVESTMENT (SUPRA), THE CIT(A) HAS HELD THAT THE CR EDITS AND DEBITS IN THE BANK ACCOUNT STOOD EXPLAINED AND ACCOUNTED FOR IN T HE APPELLATE PROCEEDINGS WHICH HAVE WARRANTED DELETION OF ADDITI ON. THEREFORE, THE REVENUE IS IN APPEAL. 7. WE HAVE HEAD BOTH PARTIES AND PERUSED ASSESSMEN T ORDER AS WELL AS THE ORDER OF THE CIT(A) UNDER CHALLENGE. ADMITTED F ACTS ARE THAT IN SCRUTINY THE ASSESSING OFFICER HAD ISSUED NECESSARY NOTICE T O THE ASSESSEE DATED 16.09.2011 ASKING FOR DETAILS STATED HEREINABOVE. S INCE THERE WAS NO RESPONSE, HE PASSED EX-PARTE ASSESSMENT ORDER. IN A PPEAL, THE CIT(A) OBSERVED THAT THE ASSESSEE HAD DULY FURNISHED AUDIT ED ACCOUNTS MAINTAINED UNDER SECTION 44AB OF THE ACT. QUA OTHER ADDITION , THE FINDINGS OF THE CIT(A) ARE THAT UNEXPLAINED CASH INVESTMENT AS TAKE N NOTE STAND EXPLAINED AND ACCOUNTED WHICH ARE PROPERLY REFLECTED IN THE C ASH AND BANK ACCOUNT STATEMENTS OF THE ASSESSEE. IN THE COURSE OF HEARIN G BEFORE US, THE ASSESSEE DENIES TO HAVE FILED ANY ADDITIONAL EVIDEN CE BEFORE THE CIT(A). IN OUR VIEW, ONCE THAT IS SO IN THE ABSENCE OF ANY EVI DENCE OR MATERIAL ON I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1937 1937 1937 1937/M/ /M/ /M/ /M/12 1212 12 4 RECORD; THERE IS HARDLY ANY JUSTIFICATION ON THE PA RT OF THE CIT(A) TO UPSET THE FINDINGS IN THE ASSESSMENT ORDER. ONCE THE ASSESSEE DID NOT FILE ANY DETAILS BEFORE THE ASSESSING OFFICER, WE ARE UNABLE TO AGRE E TO HIS CONTENTIONS THAT THE CIT(A) HAS RIGHTLY DELETED THE ADDITIONS WITHOU T ANY MATERIAL. HENCE, THE FINDINGS OF THE CIT(A) REGARDING PROPERLY AUDITED A CCOUNT UNDER SECTION 44AB AND RELEVANT ENTRIES TURN OUT TO BE BASED ON N O COGENT EVIDENCE ON RECORD. THEREFORE, WE HOLD THAT THE CIT(A) HAS ERRE D IN UPSETTING THE FINDINGS OF THE ASSESSING OFFICER. AT THE SAME TIME, IN THE LARGER INTEREST OF JUSTICE AND MINDFUL OF THE FACT THAT THE ASSESSMENT WAS COM PLETED UNDER SECTION 144 OF THE ACT, WE DEEM IT APPROPRIATE THAT THE M ATTER BE RESTORED TO THE FILE OF THE ASSESSING OFFICER WHO SHALL PROCEED AFRESH I N ACCORDANCE WITH LAW AFTER AFFORDING ADEQUATE OPPORTUNITY OF HEARING TO THE ASSESSEE. 9. IN THE RESULT, APPEAL STANDS ALLOWED FOR STATIS TICAL PURPOSE. ORDER PRONOUNCED ON MONDAY, THE 11 TH OF MARCH, 2013 AT CHENNAI. SD/- SD/- (DR. O.K. NARAYANAN) VICE - PRESIDENT (S.S. GODARA) JUDICIAL MEMBER CHENNAI, DATED, THE 11.03.2013 VM/- TO: THE ASSESSEE//A.O./CIT(A)/CIT/D.R.