Shri Sachidananad Bhagat, Bengaluru V. Income Tex Officer Ward - 5 (3) (5), Bengaluru

ITA 1988/BANG/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 5037 (ITAT-BANGALORE)
• Duration Of Justice: 1 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-08-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2014-2015
• Appeal Filed On: 12-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K N DHANDA
• Assessee Lawyers: NARENDRA JAIN
• Keywords: Opportunity of being heard; Additional evidence
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC C BENCH : BANGALORE BEFORE SHRI N.V. VASUDEVAN, JUDICIAL MEMBER ITA NO. 1988/BANG/2018 ASSESSMENT YEAR : 2014 - 15 SHRI SACHIDANAND BHAGAT, NO.68/2, GOVISHETTY BUILDING, BEHIND GANESH TEMPLE, BOMMANAHALLI, BANGALORE 560 068. PAN: DUIPS 1263J VS. THE INCOME TAX OFFICER, WARD 5(3)(5), BANGALORE. APP ELLANT RESPONDENT APP ELLANT BY : SHRI NARENDRA JAIN, CA RESPONDENT BY : SHRI K.N. DHANDAPANI, JT.CIT(DR)(ITAT), BENGALURU. DATE OF HEARI NG : 18.07 .2018 DATE OF PRONOUNCEMENT : 10 .08.2018 O R D E R THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER DATED 18.04.2018 OF THE CIT(APPEALS)-5, BENGALURU RELATIN G TO ASSESSMENT YEAR 2014-15. 2. THE ASSESSEE IS AN INDIVIDUAL. HE WAS EMPLOYED WITH THOSHIBA SOFTWARE (INDIA) PVT. LTD. FOR THE AY 2014-15, TH E ASSESSEE FILED A RETURN OF INCOME DECLARING TOTAL INCOME OF RS.3,66,490. T HE CASE OF THE ASSESSEE WAS SELECTED FOR LIMITED SCRUTINY BECAUSE OF LARGE VALUE OF TRANSACTION OF PURCHASE AND SALE OF EQUITY SHARES WITHOUT DELIVERY , AS REFLECTED IN THE AIR RECEIVED BY THE AO. SINCE IN THE RETURN OF INCOME FILED BY THE ASSESSEE, NO CAPITAL GAIN WAS OFFERED TO TAXATION, THE CASE OF A SSESSEE WAS SELECTED FOR ITA NO. 1988/BANG/2018 PAGE 2 OF 8 LIMITED SCRUTINY. THE ASSESSEE DID NOT PARTICIPATE IN THE ASSESSMENT PROCEEDINGS AND THEREFORE THE AO COMPLETED THE ASSE SSMENT TO THE BEST OF HIS JUDGMENT U/S. 144 OF THE ACT. THE AO FOUND TH AT AS PER AIR, THE ASSESSEE HAD PURCHASED SHARES WORTH RS.3,61,71,487 AND SOLD SHARES OF THE VALUE OF RS.3,82,45,731. THE DIFFERENCE BETWEE N THE PURCHASE PRICE AND SALE PRICE VIZ., RS.20,71,244 WAS ADDED AS SHOR T TERM CAPITAL GAIN BY THE AO IN THE ORDER OF ASSESSMENT. 3. AGGRIEVED BY THE ORDER OF ASSESSMENT, THE ASSESS EE FILED APPEAL BEFORE THE CIT(APPEALS). THE ASSESSEE EXPLAINED TH E REASONS FOR HIS NON- APPEARANCE BEFORE THE AO AS FOLLOWS:- 7. APPELLANT WAS BACHELOR, HAILING FROM BIHAR AND STAYING IN PAYING GUEST OR IN ROOM DURING THE PERIOD OF FY 201 3-4 TO FY 2017-18. AND APPELLANT HAS ALSO CHANGED COMPANY AND UNDERTAKEN FOREIGN TRAVEL DURING THE COURSE OF HIS EMPLOYMENT DURING THESE PERIODS. IT WAS ONLY WHEN HE APPROACHE D THE AXIS BANK DURING HIS VISIT TO BANGALORE HE REALIZED THAT THERE IS A LIEN ON HIS ACCOUNT AND REASON FOR THE SAME IS THERE IS A DEMAND FROM INCOME TAX DEPARTMENT. 8. HE APPROACHED INCOME TAX OFFICER TO UNDERSTAND T HE REASON FOR THE DEMAND AND HE WAS SURPRISED TO KNOW THAT THERE WAS AN ASSESSMENT PROCEEDINGS WHICH WENT ON WITHOUT HIS NOTICE AND IT IS CONCLUDED IN DEMAND BY THE INCOME TAX OFF ICER. 9. THEN THE APPELLANT APPROACHED THE TAX PROFESSION AL AND FILED THE APPEAL TO YOUR GOOD AUTHORITY WITH CONDON ATION OF DELAY. 4. THE ASSESSEE FURTHER SUBMITTED THAT IN FACT HE S UFFERED SHORT TERM CAPITAL LOSS ON PURCHASE AND SALE OF SHARES. IN SU PPORT OF HIS CLAIM, THE ASSESSEE FILED THE FOLLOWING ADDITIONAL EVIDENCE BE FORE THE CIT(APPEALS) AND PRAYED THAT THE SAME MAY BE ADMITTED AS ADDITIO NAL EVIDENCE UNDER RULE 46A OF THE I.T. RULES:- D) ADDITIONAL EVIDENCES SUBMITTED THE APPELLANT IS SUBMITTING HEREWITH FOLLOWING MENTIONED DOCUMENTS. IT IS THE ITA NO. 1988/BANG/2018 PAGE 3 OF 8 APPELLANT'S HUMBLE SUBMISSION THAT ADMISSION OF THE SE DOCUMENTS IS CRUCIAL FOR ADJUDICATION OF THE PRESENT APPEAL. DUE TO VARIOUS CONSTRAINTS DURING THE ASSESSMENT PROCEEDINGS, MANY OF THE FOLLOWING DOCUMENTS COULD NOT BE PRODUCED BEFORE TH E TAX AUTHORITIES. HENCE, IN THE INTEREST OF JUSTICE, APP ELLANT, WITH FOLDED HANDS, MAKES AN EARNEST PRAYER BEFORE YOUR GOOD SEL L TO PERMIT PRODUCTION OF THE FOLLOWING BASIC DOCUMENTS FOR ADJ UDICATION OF THE PRESENT APPEAL. LIST OF DOCUMENTS SUBMITTED HEREWITH ARE AS FOLLOWS : EXHIBIT 1. POWER OF ATTORNEY TO VINUTH H S TO REPRE SENT ON BEHALF OF APPELLANT EXHIBIT 2. ICICI BANK STATEMENT FOR FY 2013-14 EXHIBIT 3. TRADING BOOK STATEMENT FOR FY 2013-14 EXHIBIT 4. COMPUTATION OF SHORT TERM CAPITAL LOSS F OR FY 2013-14 APPELLANT REQUESTS YOUR GOOD SELF TO KINDLY PERMIT PRODUCTION OF THE ABOVE REFERRED PAPERS AS ADDITIONAL EVIDENCE FO R FURTHER ADJUDICATION. APPELLANT KEEPS RELIANCE ON CLAUSE (A ) AND CLAUSE (D) OF RULE 46A FOR PRODUCTION OF THESE PAPERS AS A DDITIONAL EVIDENCES. 5. THE CIT(APPEALS) HAS NOT CONSIDERED THE APPLICAT ION OF THE ASSESSEE FOR ADMISSION OF ADDITIONAL EVIDENCE NOR T HE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE. THE CIT(A) WAS OF THE VIEW THAT THE SHORT TERM CAPITAL GAIN COMPUTED BY THE AO ON THE BASIS OF AIR INFORMATION WAS CORRECT AND DID NOT CALL FOR ANY INTERFERENCE. AGG RIEVED BY THE ORDER OF CIT(APPEALS), THE ASSESSEE HAS PREFERRED THE PRESEN T APPEAL BEFORE THE TRIBUNAL. 6. I HAVE HEARD THE SUBMISSIONS OF THE LD. COUNSEL FOR THE ASSESSEE AND THE LD. DR. THE LD. DR RELIED ON THE ORDER OF C IT(APPEALS). THE LD. COUNSEL FOR THE ASSESSEE FILED BEFORE ME A CHART EX PLAINING THE TRANSACTIONS AS REFLECTED IN THE AIR AND AS TO HOW SUCH TRANSACT IONS RESULTED IN SHORT ITA NO. 1988/BANG/2018 PAGE 4 OF 8 TERM CAPITAL LOSS TO THE ASSESSEE. THE CHART SO FI LED SHOWS THE FOLLOWING POSITION:- ITA NO. 1988/BANG/2018 PAGE 5 OF 8 ITA NO. 1988/BANG/2018 PAGE 6 OF 8 ITA NO. 1988/BANG/2018 PAGE 7 OF 8 7. I AM OF THE VIEW THAT IN THE LIGHT OF THE REQUES T OF ASSESSEE BEFORE THE CIT(APPEALS) FOR ADMITTING THE ADDITIONAL EVIDE NCE, THE CIT(APPEALS) OUGHT TO HAVE CONSIDERED THE ADDITIONAL EVIDENCE UN DER RULE 46A OF THE I.T. RULES AS THE ASSESSMENT PROCEEDINGS WERE COMPL ETED EX PARTE U/S. 144 OF THE ACT. THE CIT(A) HAS NOT ADDUCED ANY REAS ON FOR NOT ACCEPTING OR REJECTING THE CLAIM OF ASSESSEE. I AM OF THE VIEW THAT THE ADDITIONAL EVIDENCE SOUGHT TO BE FILED BY THE ASSESSEE BEFORE THE CIT(A) SHOULD BE ADMITTED AS ADDITIONAL EVIDENCE. I AM OF THE VIEW THAT THE ORDER OF THE CIT(A) SHOULD BE SET ASIDE AND THE ISSUE WITH REGAR D TO DETERMINATION OF INCOME OF THE ASSESSEE UNDER THE HEAD CAPITAL GAIN SHOULD BE REMANDED TO THE AO FOR FRESH CONSIDERATION IN THE LIGHT OF A DDITIONAL EVIDENCE FILED BY THE ASSESSEE BEFORE THE CIT(A). THE ASSESSEE IS AT LIBERTY TO ESTABLISH HIS CASE BY FILING SUCH OTHER EVIDENCE BEFORE THE AO AN D SHOW AS TO HOW HE HAD IN FACT SUFFERED SHORT TERM CAPITAL LOSS. THE AO WILL AFFORD OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH THE LAW. 8. FOR STATISTICAL PURPOSES, THE APPEAL OF ASSESSEE IS TREATED AS ALLOWED. PRONOUNCED IN THE OPEN COURT ON THIS 10 TH DAY OF AUGUST, 2018. SD/- ( N.V. VASUDEVAN ) JUDICIAL MEMBER BANGALORE, DATED, THE 10 TH AUGUST, 2018. / D ESAI S MURTHY / ITA NO. 1988/BANG/2018 PAGE 8 OF 8 COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY ITAT, BANGALORE.