M/s. Shruti Fastners Ltd., New Delhi V. DCIT, New Delhi

ITA 1947/DEL/2013

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 6507 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 10 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-03-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 17-01-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 04-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHAVETA NAKRA DUTT
• Keywords: Opportunity of being heard; Additional evidence
• Section: 234B; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: G NEW DELHI BEFORE SHRI H. S. SIDHU, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER I.T.A. NO. 1947/DEL/2013 ASSESSMENT YEAR: 2009-10 M/S SHRUTI FASTNERS LTD., VS. DCIT, CIRCLE 8(1) 1666-B, GOVINDPURI EXTENSION, NEW DELHI MALL ROAD, KALKAJI, NEW DELHI 110 019 (PAN: AAACS2175H) (ASSESSEE) (RESPONDENT) ASSESSEE BY : SH. SOMIL AGGARWAL, ADV. REVENUE BY : SH. SHAVETA NAKRA DUTT, SR. DR ORDER PER H.S. SIDHU, JM THIS APPEAL IS FILED BY ASSESSEE AGAINST THE ORDER DATED 28.2.2011 PASSED BY THE LD. CIT(A)-XI, NEW DELHI RE LATING TO ASSESSMENT YEAR 2009-10 ON THE FOLLOWING GROUNDS:- 1. THAT THE LD. CIT(A) HAS ERRED ON FACTS AND UNDER THE LAW IN NOT ADMITTING THE ADDITIONAL EVIDENCE AS FILED BEFORE HER. 2 2. THAT THE ADDITION OF RS. 10,70,987/- AS MADE BY THE AO TOWARDS THE ASSESSABLE INCOME OF THE APPELLANT ON ACCOUNT OF LOANS BEING ILLEGAL AND UNJUSTIFIED ON THE FACTS OF THE CASE, OUGHT TO HAVE BEEN DELETED BY THE LD. CIT(A). VARIOUS OBSERVATIONS MADE BY THE AUTHORITIES BELOW IN THEIR RESPECTIVE ORDERS ARE EITHER INCORRECT OR UNTENABLE. DETAILED WRITTEN SUBMISSIONS ALONGWITH THE PAPER BOOK AS FILED BEFORE THE LD. CIT(A) AND THE ARGUMENTS ADVANCED BY THE COUNSEL HAD NOT BEEN APPRECIATED PROPERLY OR HAD BEEN IGNORED. 3. THAT WITHOUT PREJUDICE TO GROUND NO. 2 ABOVE, THE ADDITION OF RS. 10,70,987/- IS VERY EXCESSIVE. 4. THAT THE LD. CIT(A) HAD ERRED ON FACTS AND UNDER THE LAW IN MAKING ENHANCEMENT TO THE INCOME ASSESSED BY THE AO BY RS. 2,21,013/-. IN OTHER WORDS, THE TOTAL 3 ADDITIONS MADE AMOUNTING TO RS. 12,92,000/- IS ILLEGAL AND AT ANY RATE, WITHOUT PREJUDICE VERY EXCESSIVE. 5. THAT THE INTEREST AS LEVIED U/S. 234B IS ILLEGAL AND AT ANY RATE, WITHOUT PREJUDICE VERY EXCESSIVE. 6. THAT THE APPELLANT RESERVES ITS RIGHT TO ADD, AMEND / MODIFY THE GROUNDS OF APPEAL. 2. FACTS NARRATED BY THE REVENUE AUTHORITIES ARE NO T DISPUTED BY BOTH THE PARTIES, HENCE, THE SAME ARE NOT REPEAT ED HERE FOR THE SAKE OF BREVITY. 3. AT THE TIME OF HEARING, LD. COUNSEL OF THE ASSES SEE, DRAW OUR ATTENTION TOWARDS THE IMPUGNED ORDER DATED 10.3 .2014 ESPECIALLY THE PROCEEDINGS OF HEARING CONDUCTED BY THE LD. FIRST APPELLATE AUTHORITY, AS MENTIONED IN THE IMPUGNED O RDER AND STATED THAT THE LD. FIRST APPELLATE AUTHORITY HAS NOT PROVIDED EFFECTIVE OPPORTUNITY OF HEARING TO THE ASSESSEE. H E FURTHER STATED THAT ASSESSEE HAS FILED THE APPLICATION UNDER RULE 46A OF THE I.T. RULES, 1962 ALONGWITH THE ADDITIONAL EVIDENCES, WH ICH WAS SENT TO THE AO VIDE LETTER DATED 10.7.2012 FOR HIS COMME NTS. IN COMPLIANCE TO THE SAME, THE AO SENT HIS REMAND REPO RT, WHO 4 HAS NOT SENT HIS COMMENTS AND LD. CIT(A) MENTIONED IN HIS ORDER THAT SINCE NO REPORT HAS BEEN RECEIVED FROM THE AO, HE DID NOT PROPOSE TO DELAY THE PROCEEDINGS FURTHER AND FIRST TAKEN UP THE ISSUE OF ADMISSIBILITY OF ADDITIONAL EVIDENCE. LD. COUNSEL OF THE ASSESSEE FURTHER STATED THAT LD. CIT(A) HAS WRONGLY OBSERVED THAT SEVERAL OPPORTUNITIES WERE PROVIDE TO THE ASSESSEE TO GIVE COMPLETE DETAILS, BUT ASSESSEE COULD NOT GIVE FULL DETAILS TO THE AO AND FINALLY HELD THAT SINCE NO REASONS HAVE BEEN GIVEN FOR NOT GIVING COMPLETE DETAILS AT THE TIME OF ASSESSMENT P ROCEEDINGS, HE DID NOT ADMIT THE ADDITIONAL EVIDENCE FILED UNDER R ULE 46A. IN THIS REGARD, IN THIS CASE NEITHER THE AO HAS SENT H IS COMMENTS ON THE REMAND REPORT, NOR THE LD. CIT(A) HAS ADMITTED THE ADDITIONAL EVIDENCE FILED UNDER RULE 46A WHICH GOES TO THE ROOT OF THE MATTER AND ARE VERY ESSENTIAL TO DECIDE THE I SSUE IN DISPUTE. LD. COUNSEL FOR THE ASSESSEE FURTHER STATED THAT AS SESSEE HAS FILED THE PAPER BOOK CONTAINING PAGES 1 TO 3 IN WHI CH HE HAS ATTACHED THE COPY OF SUBMISSION DATED 9.7.2012 FILE D BEFORE THE LD. CIT(A); COPY OF SUBMISSION DATED 10.1.2011 FILE D BEFORE DCIT, CIRCLE 8(1), NEW DELHI DURING ASSESSMENT PROCEEDING S; DETAILS OF UNSECURED LOANS TAKEN BY THE ASSESSEE DURING FY 200 8-09 ALONGWITH THE INCOME TAX RETURN FILING PROOFS OF TH E LENDERS, THEIR DULY CONFIRMED COPIES OF ACCOUNTS AND THEIR BANK S TATEMENTS; 5 COPIES OF LEDGER ACCOUNTS OF TDS ON INTEREST AND I NTEREST ON UNSECURED LOANS; COPIES OF FORM 26AS AS DOWNLOADED FROM DEPARTMENTAL WEBSITE OF M/S EXTREME HOLDINGS PVT. L TD. AND M/S PRANAV SECURITIES PVT. LTD; COPY OF ANNEXURE C TO T HE TAX AUDIT REPORT FOR AY 2009-10; COPY OF JUDGMENT OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT-V, VS. NPAR DRUGS PVT. LTD . (ITA NO. 4/DEL/2008); COPY OF NOTICE OF ENHANCEMENT DATED 14 .2.2013 ISSUED BY CIT(A)-XI; REPLY DATED 26.2.2013 FILED BY THE ASSESSEE IN RESPONSE TO THE ENHANCEMENT NOTICE ISSUED BY CIT (A)-XI. HE ALSO DRAW OUR ATTENTION TOWARDS THE CONTENTION OF T HE APPLICATION UNDER RULE 46A OF THE I.T. RULES, 1962 ALONGWITH TH E ADDITIONAL EVIDENCES FILED BY THE ASSESSEE MENTIONED IN THE P APER BOOK ESTABLISHING FOR FULFILLING THE REQUIREMENTS OF THE PROVISIONS UNDER SECTION 68 OF THE I.T. ACT, 1961. HE REQUESTED THA T THE ADDITION IN DISPUTE MAY BE CANCELLED AND OR IN THE ALTERNATI VE THE ISSUE IN DISPUTE MAY BE SET ASIDE TO THE AO TO DECIDE THE SA ME, AFTER THOROUGHLY EXAMINATION OF THE ADDITIONAL EVIDENCES FILED BY THE ASSESSEE BEFORE THE LD. CIT(A) ALONGWITH APPLICATIO N U/R. 46A. 4. ON THE CONTRARY, LD. DR RELIED UPON THE ORDER P ASSED BY THE LD. CIT(A) AND STATED THAT ASSESSEE WAS GIVEN SUFFICIENT OPPORTUNITY FOR SUBSTANTIATING HIS CLAIM, BUT HE COULD NOT AVAIL 6 THE SAME. THEREFORE, THE ORDER OF THE AUTHORITIES B ELOW ESPECIALLY THE IMPUGNED ORDER MAY BE UPHELD AND APPEAL OF THE ASSESSEE MAY BE DISMISSED. 5. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE R ECORDS, ESPECIALLY THE IMPUGNED ORDER PASSED BY THE LD. CI T(A). AFTER EXAMINING THE IMPUGNED ORDER ALONGWITH ADDITIONAL E VIDENCES FILED BY THE ASSESSEE U/R. 46A OF THE I.T. RULES, 1962 IN SHAPE OF PAPER BOOK CONTAINING PAGES 1 TO 33, AS MENTIONED IN PARA NO. 4 ABOVE, WE ARE OF THE CONSIDERED VIEW THAT THE EVI DENCES FILED BY THE ASSESSEE BEFORE THE LD. CIT(A) ARE VERY MUCH ES SENTIAL TO RENDER THE JUSTICE TO THE PARTIES. THEREFORE, THE A DDITIONAL EVIDENCES FILED BY THE ASSESSEE ALONGWITH APPLICAT ION U/S. 46A OF THE I.T. RULES, 1962 ARE ADMITTED. AFTER EXAMINI NG THE ADDITIONAL EVIDENCES FILED BY THE ASSESSEE, WE ARE OF THE VIEW THAT THESE EVIDENCES REQUIRES THOROUGH EXAMINATION AT T HE LEVEL OF THE AO. THEREFORE, WE SET ASIDE THE ISSUES IN DISPUTE TO THE FILE OF THE AO. THE AO IS DIRECTED TO EXAMINE THE ADDITIONAL EV IDENCES AND OTHER DOCUMENTS AND DECIDE THE ISSUE IN DISPUTE AFR ESH, UNDER THE LAW, AFTER GIVING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 7 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 03/03/2017 . SD/- SD/- [PRASHANT MAHARISI] [H.S. SIDHU] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 03/03/2017 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES