Ram Kumar , Basti V. Income Tax Officer, Basti

ITA 203/LKW/2012

• Counselvise Citation: 20323714 RSA 2012
• Duration Of Justice: 2 year(s) 6 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 08-09-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 17-04-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: P K DEY
• Assessee Lawyers: M P MISHRA
• Keywords: Opportunity of being heard; Principle of natural justice; Initiation of penalty proceedings
• Section: 234B

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.203/LKW/2012 ASSESSMENT YEAR:2007 - 08 SHRI RAM KUMAR, S/O LAXMI NARAYAN, MANGAL BAZAR, BASTI. PAN:ANVPK7406Q VS. INCOME TAX OFFICER, BASTI. (APPELLANT) (RESPONDENT) APPELLANT BY SHRI M. P. MISHRA, ADVOCATE RESPONDENT BY SHRI P. K. DEY, D.R. DATE OF HEARING 08/09/2014 DATE OF PRONOUNCEMENT 2 1 /10/2014 O R D E R PER A. K. GARODIA, A.M. THIS IS AN ASSESSEES APPEAL DIRECTED AGAINST THE ORDER PASSED BY LEARNED CIT(A) - II, LUCKNOW DATED 18/02/2012 FOR THE ASSESSMENT YEAR 2007 - 08. 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER: 1. THAT THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS ) HAS ERRED IN LAW AND ON FACTS IN ARBITRARILY DISMISSING THE APPEAL WITHOUT ALLOWING THE APPELLANT A REASONABLE OPPORTUNITY OF BEING HEARD AND WITHOUT CONSIDERING THE GROUNDS OF APPEAL ON MERITS. 2. THAT THE LEARNED COMMISSIONER OF INC OME - TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN DISMISSING THE APPEAL FAILING TO CONSIDER THE FACT THAT THE ASSESSEE - APPELLANT HAS SURRENDERED THE SUM OF RS. 5,00,000/ - UNDER BONA FIDE BELIEF THAT PENALTY PROCEEDINGS U/S 271(1)(C) OF THE IT. ACT,1961 WOU LD NOT BE INITIATED BY THE A. O . 2 3. THAT THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS ) HAS ERRED IN LAW AND ON FACTS IN FAILING TO QUASH THE PENALTY NOTICE U/S 271(1)(C) OF THE I.T. ACT, 1961, WHICH WAS ILLEGALLY ISSUED BY THE LEARNED A.O. AGAINST THE PRINCIPLES OF NATURAL JUSTICE. 4. THAT THE LEARNED COMMISSIONER OF INCOME - TAX ( APPEALS ) HAS ERRED IN LAW IN CONFIRMING THE LEVY OF INTEREST UNDER SECTIONS 234A, 234B AND 234C OF THE INCOME - TAX, ACT 1961. 5. THAT THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS ERRED IN LAW IN CONFIRMING THE EXTRA PROFIT ADDITION OF RS.40,000/ - WHICH HAS BEEN MADE BY THE A.O. ON THE BASIS OF PRESUMPTIONS SURMISES AND CONJECTURES. 3. IT WAS SUBMITTED BY LEARNED A.R. OF THE ASSESSEE THAT THE ASSESSING OFFICER HAS ESTIMATED THE GROSS SALES OF THE ASSESSEE AT RS.5 LAC S WITHOUT ANY BASIS AND MADE ADDITION OF RS.4 0 ,000/ - , WHICH IS NOT JUSTIFIED. 4. AS AGAINST THIS, LEARNED D.R. OF THE REVENUE SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. HE ALSO SUBMITTED THAT THE A DDITION OF RS.5 LAC WAS MADE ON THE BASIS OF ASSESSEES OWN SURRENDER BEFORE THE ASSESSING OFFICER. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT IT IS NOTED BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER THAT THE ASSESSEE IS A GOLD WORKER AND JEWELLER AND ON TURNOVER OF RS.3,00,000/ - , NET PROFIT IS SHOWN AT RS.60,000/ - AND RS.80,000/ - HAS BEEN SHOWN FROM GOLD WORK AND BROKERING. THEREAFTER, THE ASSESSING OFFICER STATED IN THE ASSESSMENT ORDER THAT THE ASSESSEE COULD NOT FURNISH ANY EVIDEN CE REGARDING PURCHASE OF JEWELLERY FOR HIS SHOP OR ON BEHALF OF OTHERS AND THEREFORE, HE ESTIMATED SALE AT RS.5 LAC AND MADE ADDITION OF RS.40,000/ - . WE ARE OF THE CONSIDERED OPINION THAT SINCE THE ASSESSEE HAS DISCLOSED TURNOVER OF RS.3 LAC ONLY, HE WAS NOT SUPPOSE D TO MAINTAIN ANY BOOKS OF ACCOUNT AS PER SECTION 44AF OF THE ACT AND THEREFORE, THE ESTIMATION OF THE TURNOVER AT RS.5 LAC AND MAKING ADDITION OF RS.40,000/ - IS NOT JUSTIFIED WITHOUT BRINGING ANY ADVERSE MATERIAL ON RECORD 3 FOR RESORTING TO SUCH ESTIMATION OF SALES. THEREFORE, THIS ADDITION IS DELETED. ACCORDINGLY, GROUND NO. 5 IS ALLOWED. 6. REGARDING GROUND NOS. 1 TO 3, WE FIND THAT THESE GROUNDS ARE IN RESPECT OF INITIATION OF PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT. THESE GROUNDS ARE PRE - MATURE AT THIS STAGE BECAUSE THIS ISSUE CAN BE RAISED WH EN PENALTY IS IMPOSED BY THE ASSESSING OFFICER. THEREFORE, THESE GROUNDS ARE REJECTED AS PRE - MATURE. 7. REGARDING GROUND NO. 4, WE FIND THAT THIS IS REGARDING LEVY OF INTEREST U/S 234A, 234B AN D 234C. THIS ISSUE IS CONSEQUENTIAL AND THEREFORE, THIS GROUND IS ALSO REJECTED. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS PARTLY ALLOWED. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 2 1 /10/2014. *C.L.SINGH COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. CONCERNED CIT 4. THE CIT(A) 5. D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR