ACIT, C.C. - 3(2), Kolkata V. Sri Bijay Kumar Agarwal , Kolkata

ITA 1942/KOL/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 4945 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 5 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-02-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 29-01-2020
• Assessment Year: 2005-2006
• Appeal Filed On: 07-09-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DHRUBAJYOTI RAY J
• Assessee Lawyers: S JHAJHARIA
• Keywords: Document seized; Tangible material; Reason to believe; Documents seized
• Section: 143(3); 207; 147; 148

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH A KOLKATA BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND DR. A.L. SAINI, ACCOUNTANT MEMBER ITA NO. 1942 / KOL / 2018 ASSESSMENT YEAR :2005-06 ACIT, CENTRAL CIRCLE-3(2), AAYAKAR BHAWAN, POORVA, 5 TH FLOOR, 110, SANTIPALLY, KOLKATA-700 107 V/S . SRI BIJAY KUMAR AGARWAL, 41, ANANDJYOTI, N.S. ROAD, ROOM NO. 404, 4 TH FLOOR, KOLKATA-700 001 [ PAN NO.ACVPA 6291 J ] /APPELLANT .. / RESPONDENT /BY APPELLANT SHRI DHRUBAJYOTI RAY, JCIT-DR /BY RESPONDENT SHRI S. JHAJHARIA, FCA /DATE OF HEARING 29-01-2020 /DATE OF PRONOUNCEMENT 21-02-2020 / O R D E R PER S.S.GODARA, JUDICIAL MEMBER:- THIS REVENUES APPEAL FOR ASSESSMENT YEAR 2005-06 ARISES AGAINST THE COMMISSIONER OF INCOME TAX (APPEALS)-7, KOLKATAS O RDER DATED 21.06.2018 PASSED IN CASE NO.244/CIT(A)-7/KOL/CIRCLE-27/16-17, INVOLVING PROCEEDINGS U/S 147 R.W.S. 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. 2. THE REVENUE RAISES THE FOLLOWING SOLE SUBSTANTIV E GROUND OF APPEAL:- 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, WHETHER THE LD. CIT(A) WAS JUSTIFIED IN DELETING THE ADDITION OF RS.7,23,97,50 0/- WITHOUT APPRECIATING THE CONTENT OF THE SEIZED DOCUMENTS MARKED AK/PDP/16 SPECIALLY WHEN THE ASSESSEE ACKNOWLEDGED ALL ENTRIES IN THE SAID DOCUMENTS RELA TING TO PAYMENTS / RECEIPTS BY CHEQUE BUT PLEADED IGNORANCE IN RESPECT OF CASH TRA NSACTIONS EMBEDDED BETWEEN THE TRANSACTIONS IN CHEQUE. ITA NO.1942/KOL/2018 A.Y. 2005-06 ACIT,CC-3(2), KOL VS. SH. BIJAY KR.AGARWAL PAGE 2 3. IT TRANSPIRES DURING THE COURSE OF HEARING IS TH AT THE CIT(A)S ORDER UNDER CHALLENGE HAD NOT ONLY REVERSED THE ASSESSING OFFICERS ACTION ADDING THE AMOUNT IN DISPUTE OF 7,23,97,500/- BUT ALSO HE HAS QUASHED SEC. 148 / 147 PROCEEDINGS AS NOT VALID VIDE HIS FOLLOWING DET AILED DISCUSSION:- DECISION : THE APPELLANT HAS CHALLENGED THE VALIDITY OF THE PR OCEEDINGS U/S. 147 AND ON A PERUSAL OF THE DOCUMENTS AS AVAILABLE ON RECORD AND THE SUBMISSION OF THE APPELLANT AS WELL AS THE REASONS RECORDED, IT APPEARS THAT TH E AO HAS INITIATED SUCH PROCEEDINGS U/S. 147 ON THE BASIS OF THE SURVEY CON DUCTED IN THE CASE OF M/S SALARPURIA PROPERTIES PVT. LTD., WHEREIN THE ASSESS EE IS A MANAGING DIRECTOR. ON GOING THROUGH THE REASONS RECORDED IT WAS OBSERVED THAT THE AO CONTENDS THAT PAYMENT OF RS.10,18,97,500/- HAS BEEN PAID IN CASH TO DIFFERENT PARTIES AND FURTHER MENTION THAT CIRCUMSTANTIAL EVIDENCES SUGGEST THAT THE PAYMENT WAS MADE BY THE ASSESSEE. HENCE, THE REOPENING U//S 147 BY ISSUING OF NOTICE U/S. 148. THE APE ON ITS PART HAS OBJECTED TO THE REASONS SO RECORDED FOR RE OPENING AND AS SUCH VALIDITY OF NOTICE ISSUED U/S.148 AND ALSO CONTENTS THAT SINCE THE REOPENING IS BEYOND 4 YEARS AND THERE BEING NO FAILURE ON THE PART OF THE ASSES SEE TO DISCLOSE ANY INFORMATION, THE REOPENING PROCEEDINGS FAILS. THE APPELLANT ON ITS P ART HAS ALSO CONTENDED THAT THERE BEING NO REASON TO BELIEVE NOR THERE BEING ANY TANGIBLE MATERIAL FOR REOPENING OF THE ASSESSMENT AS EVIDENT FROM THE REASONS RECOR DED, THE REOPENING PROCEEDINGS FAILS. HAVING CONSIDERED THE APPELLANTS SUBMISSIONS AND T HE AO'S ORDER AND THE MATERIAL SO AVAILABLE ON RECORD, I FIND THAT THE MATTER NEED S DETAILED DELIBERATION. HAVING GONE THROUGH THE ORDER, I FIND THAT THE AO IN THE ORDER REFERS TO SUCH OPERATION CARRIED ON AT THE PREMISES TO ONE SRI P. DAYANAND PAI ON 12.4.201 1 AT BANGALORE AND ONE SUCH PREMISES WAS OF MRS. ADLENE KAGOO ( EMPLOYEE OF P. DAYANAND PAI ) WHEREFROM VARIOUS INCRIMINATING DOCUMENTS DETAILING UNACCOUNT ED TRANSACTIONS BETWEEN SUCH MR. P. DAYANAND PAI AND VARIOUS OTHER PARTIES WERE MADE. THIS PARTICULAR DOCUMENTS WERE MARKED AS AK-PDP-16 RELATING TO TRANSACTION BE TWEEN MR. P.DAYANAND PAI AND SALARPURIA GROUP. MRS. ADLENE KAGOO HAD CONFIRMED I N HER STATEMENT THAT SHE HAD RECORDED SUCH TRANSACTIONS ON THE INSTRUCTIONS OF M R. P. DAYANAND PAI. THE AO IN THE ORDER HAS ALSO ENCLOSED COPY OF SUCH DOCUMENTS MARK ED AS AK-PDP-16 FROM PAGES 187 TO 207 WHICH SHOWED THE DETAILED TRANSACTIONS C ARRIED BETWEEN MR. P. DAYANAND PAI AND SALARPURIA GROUP ( WHICH IS ALSO ATTACHED AS PART OF ANNEXURE TO ORDER U/S.147 BY AO ). IN THE ORDER, THE AO PROCEEDINGS U/S 147 WERE IN ITIATED. HOWEVER, THE SAME DOES NOT TALLY WITH THE REASONS RECORDED ONCE THE SAME NOWHERE MENTIONS ABOUT SUCH DOCUMENT AND IT MERELY MENTION THE SURVEY BEING CONDUCTED AND IT DOES REFER TO THE SEARCH O NR. P. DAYANAND P AI AND OTHER CONSEQUENTIAL EVENT THAT IS SUCH RECORDED STATEMENT ETC. EVEN IF IT IS ASSUMED THAT THE TRANSACTIONS PERTAINS TO OR BELONGINGS TO THE APPELLANT, THE REA SONS RECORDED DO NOT SUPPORT THE SAME AND SINCE THE REASONS RECORDED ITSELF ON THE B ASIS OF REOPENING WHICH SPEAK OTHERWISE, HENCE THE ENTIRE PROCEEDING I.E. ISSUE O F NOTICE U/S. 148 AND THE CONSEQUENTIAL PROCEEDINGS BECOMES VOID AND FOR THE SAME I DRAW SUPPORT FROM THE FOLLOWING COURTS DECISIONS: I) PRANSUKHLAL BROTHERS 229 TAXMANN 444 (BOM) II) MUNSHI MINI RICE MILL V. ITO ITA NO.1650/KOL/ 2014 DT. 14.10.2014 III) NORTHERN EXIM (P) LTD. 337 ITR 586 (DEL) ITA NO.1942/KOL/2018 A.Y. 2005-06 ACIT,CC-3(2), KOL VS. SH. BIJAY KR.AGARWAL PAGE 3 IT IS ALSO OBSERVED THAT THE AO IN THE REASONS RECO RDED HAS NOWHERE MENTIONED THAT THERE IS FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE ANY INFORMATION AND HENCE THERE REOPENING FAILS. HERE I DRAW SUPPORT FR OM FOLLOWING COURTS DECISIONS:- A) HARIKISHANLALA SUNDERLAL VIRMANI 394 ITR 146 ( GUJ) B) SWAROVSKI INDIA (P) LTD 36 ITR 601 (DEL) C) GLOBAL SIGNAL CABLES (I) (P) LTD. 368 ITR 609 (DEL) HENCE, THE PROCEEDINGS SO INITIATED BY THE AO BY IS SUING OF NOTICE U/S. 148 AND THE CONSEQUENTIAL ORDER U/S. 147 CANNOT BE UPHELD AND H ENCE THERE GROUNDS OF THE APPELLANT ARE ALLOWED . 4. LEARNED DEPARTMENTAL REPRESENTATIVE FAILS TO DIS PUTE THAT THE REVENUE HAS NOWHERE CHALLENGED THE CIT(A)S ACTION QUASHING THE IMPUGNED RE- OPENING / RE-ASSESSMENT IN ITS PLEADINGS NOR IS THE RE ANY PLEA BEFORE US SEEKING TO AMEND ITS SUBSTANTIVE GROUNDS RAISED IN THE INSTANT APPEAL. WE CONCLUDE IN THESE FACTS AND CIRCUMSTANCES THAT THE CIT(A)S ABOVE EXTRACTED LOWER APPELLATE DISCUSSION QUASHING THE RE-OPENING / RE-ASSESSMENT ATTAIN FINALITY AND RENDER THE REVENUES PLEADINGS ON MERI TS AS INFRUCTUOUS. ORDERED ACCORDINGLY. 5. THIS REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT 21/02/2020 SD/- SD/- ( &) (( &) ( A.L.SAINI) (S.S.GODARA) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) KOLKATA, *DKP SR.P.S )- 21 / 02 /20 20 / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-ACIT,C.C-3(2), AAYAKAR BHAWAN, POORVA, 5 TH FL. 110, SHANTIPALLY, KOLKATA-107 2. /RESPONDENT-SRI BIJAY KR. AGARWAL, 41, ANAND JYOTI, N.S. RD. R. NO.404, 4 TH FL. KOLKATA-001 3. 4 5 / CONCERNED CIT KOLKATA 4. 5- / CIT (A) KOLKATA 5. 8 ((4, 4, / DR, ITAT, KOLKATA 6. = / GUARD FILE. BY ORDER/ , /TRUE COPY/ 4,