ITO, Jaipur V. SHRI HARPHOOL JAT, Jaipur

ITA 228/JPR/2012

• Counselvise Citation: 22823114 RSA 2012
• Duration Of Justice: 2 year(s) 8 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-11-2014
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 09-03-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: NEENA JEEPH
• Keywords: Additional evidence; Corroborative evidences; Revised return
• Section: 131

Judgement Text

ITA NO. 228/JP/2012 ITO V S. HARPHOOL JAT, JAIPUR 1 IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH, JAIPUR (BEFORE SHRI R.P. TOLANI AND SHRI T.R. ME ENA) ITA NO. 228/JP/2012 ASSESSMENT YEAR: 2007-08 PAN : ADUPJ 3646 A THE ITO VS. SHRI HARPHOOL JAT WARD- 7 (2) 35, JATON KI DHANI, TEELAWAS JAIPUR AJMER ROAD, JAIPUR (APPELLANT) (RESPONDENT) DEPARTMENT BY: MS. NEENA JEEPH ASSESSEE BY : SHRI MAHENDRA GARGIEYA DATE OF HEARING: 01-10-2014 DATE OF PRONOUNCEMENT: 28-11-2014 ORDER PER R.P. TOLANI, JM THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THE LD. CIT(A)-III, JAIPUR DATED 30-12-2011 FOR THE ASSESSM ENT YEAR 2007-08 WHEREIN FOLLOWING GROUNDS ARE RAISED: (I) THE LD. CIT(A) HAS ERRED IN ACCEPTING ADDITIONA L EVIDENCE WITHOUT SPECIFYING AS TO HOW THE CONDITION S OF RULE 46A HAS BEEN MET BY THE APPELLANT. (II) THE LD. CIT(A) HAS ERRED IN NOT PROVIDING ADEQ UATE OPPORTUNITY TO THE TO EXAMINE THE EVIDENCE/ STATED CREDITORS, BEFORE SUBMISSION OF HIS REMAND REPORT. ITA NO. 228/JP/2012 ITO V S. HARPHOOL JAT, JAIPUR 2 (III) THUS THE LD. CIT(A) HAS ERRED IN DELETING ADD ITION MADE ON ACCOUNT OF STATED LOANS OF RS. 35 LAKHS AN D RS. 21.90 LAKHS SHOWN RECEIVED FROM SHRI BABU LAL JAT & SHRI HANUMAN SAHAI JAT. 2.1 LD. DR CONTENDS THAT DURING THE COURSE OF ASSES SMENT PROCEEDINGS, THE ASSESSEE WAS DEMONSTRATIVELY NON-COOPERATIVE WH ICH IS EVIDENT FROM THE FOLLOWING OBSERVATIONS OF LD. AO AT PAGE 1 OF THE O RDER: ON 01-09-09 SHRI SAJJAD AZIZ, ADVOCATE APPEARED A ND SOUGHT MORE TIME FOR PRODUCING EVIDENCE OF INCOME D ECLARED IN THE RETURN. ACCORDINGLY, CASE WAS ADJOURNED ON 17-0 9-09. ON 1-09-09, NONE APPEARED NOR WAS ANY ADJOURNMENT SOUG HT. SINCE THE ASSESSEE WAS NOT COMING FORWARD WITH THE EVIDENCES IN SPITE OF REPEATED TELEPHONIC REQUESTS, NOTICE U/ S 132(1) DATED 220-10-09 CALLING FOR THE FOLLOWING DETAILS WAS SER VED ON THE ASSESSEE AND THE CASE WAS FIXED FOR HEARING ON 06- 11-2009. (A) DETAILS OF MOVABLE AND IMMOVABLE PROPERTY OWNED. (B) DETAILS OF MOVABLE AND IMMOVABLE PROPERTY SOLD FOR THE ASSESSMENT YEAR 2006-07. BANK STATEMENTS FOR THE ASSESSMENT YEARS 2006- 07M, 2007-08 AND 2008-09. (D) SUPPORTING EVIDENCE FOR INCOME DECLARED IN THE RETURN ASSESSMENT YEAR 2006-07. SHRI SAJJID AZIZ APPEARED ON 06-11-2009 AND SOUGHT ADJOURNMENT ON PERSONAL GROUNDS. THE CASE WA S ADJOURNED TO 13-11-2009 ON THE CONDITION THAT NO FU RTHER ADJOURNMENT WILL BE GRANTED. BUT NONE APPEARED ON 1 3- 11-2009. ON 07-11-2009, THE A/R APPEARED AND FILED A ITA NO. 228/JP/2012 ITO V S. HARPHOOL JAT, JAIPUR 3 COPY OF REVISED RETURN ALONGWITH ITS ANNEXURES, STA TED TO HAVE BEEN FILED ON 27-03-2009 A PERUSAL OF THE COPY OF THE STATEMENT OF AFFAIRS ANNEXED TO THE REVISED RETURN REVEALED THAT THE ASS ESSEE OWNED PROPERTY AT KRIHI VIHAR FOR RS. 35,71,660/-, RATHI NAGAR FOR RS. 19,80,320/- AND PROPER RESERVE FUND O F RS. 40,00,000/- . IN THE CAPITA ACCOUNT AGRICULTURAL LA ND FOR RS. 40,00,000/- HAS BEEN SHOWN. THE FOLLOWING SUNDR Y CREDITORS HAVE ALSO BEEN SHOWN. BABU LAL JAT RS. 35,00,000/- HANUMAN SAHAI JAT RS. 21,90,000/- KAILASH CHAND SAIN RS. 19,25,000/- MR.CHOUDHARY RS. 50,000/- VIDE ORDER SHEET ENTRY DATED 7-12-09, THE A.R. WAS REQUIRED TO FURNISH CONFIRMATION FROM THEABOVE PERS ONS AND THE CASE WAS ADJOURNED TO 11-12-09. ON 11-12-09 , NONE APPEARED BUT ON 14-12-09 THE A.R. APPEARED AND FILED THREE CONFIRMATIONS STATED TO HAVE BEEN FROM SHRI BABU LAL JAT, SHRI HANUMAN SAHAI JAT AND SHRI KAILA SH CHAND SAIN. NO CONFIRMATION HAS BEEN FILED FROM MR. CHOUDHARY. A PERUSAL OF THE CONFIRMATIONS SO FILED REVEALED THAT THE CONFIRMED STATED TO HAVE BEEN FUR NISHED BY SHRI BABU LAL JAT AND SHRI HANUMAN SAHAI JAT DID NOT HAVE THE PAN. THEREFORE, VIDE ORDER SHEET ENTRY DATED 14-12-09, THE A/R WAS REQUIRED TO PRODUCE BOT H THE PERSONS AT 10.30 A.M. ON 16-12-09. ON 16-12-09, NONE APPEARED BUT ON 17-12-09 SHRI SAJJID AZIZ, A.R APPEARED BUT EXPRESSED HIS INABILITY TO PRODUCE THE CREDITORS. HOWEVER, HE SUGGESTED THAT THEY MAY BE SUMMONED U/S 131 OF THE I.T. ACT . ACCORDINGLY, SUM MONS U/S 131 DATED 18-12-09 WERE SERVED ON THEM ON 19-12 -09 REQUIRING THEIR ATTENDANCE BEFORE THE UNDERSIGNED O N 22- 12-09 AT 11.00 A.M.. THEY WERE ALSO REQUIRED TO PRO DUCE BANK PASS BOOKS/ STATEMENTS FOR THE FINANCIAL YEAR 2006- ITA NO. 228/JP/2012 ITO V S. HARPHOOL JAT, JAIPUR 4 07, DETAILS OF AGRICULTURAL LAND HELD AND DETAILS O F AGRICULTURAL LAND SOLD DURING THE FINANCIAL YEAR 20 06-07 AND COPIES OF REGISTERED SALE DEED OF AGRICULTURAL LAND OWNED/ SOLD BY THEM. ONE COPY EACH OF THE SUMMONS U /S 131 WERE SENT BY REGISTERED POST ALSO. HOWEVER, NON E APPEARED ON THIS DATE, NEITHER FILED ANY OF THE DOC UMENTS SOUGHT TO BE PRODUCED NOR ANY ADJOURNMENT WAS SOUGH T. VIDE ORDER SHEET ENTRY DATED 17-12-09, IT WAS BROUG HT TO THE NOTICE OF THE A.R. THAT SINCE SHRI BABU LAL JAT AND SHRI HANUMAN SAHAI JAT WERE NOT PRODUCED, ASSESSEE'S CLA IM OF HAVING OBTAINED LOANS FROM THESE TWO PERSONS COULD NOT BE VERIFIED. THEREFORE, IT WAS PROPOSED THAT THE CASH CREDITS OF RS. 56.90 LACS IS TO BE TREATED AS ASSESSEE'S UNDISCLOS ED INCOME AND TAXED ACCORDINGLY. THE A.R WAS THEREFORE, REQUIRED TO FILE HIS REPLY, IF ANY, 21-12-2009. 2.3 IN HIS PURSUIT OF NON COOPERATION ASSESSEE FILE D THE SKETCHY ON 21-12- 2009 AND THE ASSESSMENT IN QUESTION IS FRAMED ON 23 -12-2009. IN THESE FACTS, THE AO PASSED THE ORDER MAKING THE ADDITIONS ON THE BASIS OF THE MATERIALS AVAILABLE ON RECORD. 2.4 AGGRIEVED, THE ASSESSEE PREFERRED FIRST APPEAL WHERE THE ADDITIONAL EVIDENCE WAS FILED BY THE ASSESSEE BEFORE THE LD. C IT(A) WITHOUT GIVING PROPER REASONS AS TO HE WAS PREVENTED BY SUFFICIENT CAUSE IN NOT FILING THESE IMPORTANT DOCUMENTS BEFORE AO. LD. CIT(A) ADMITTED THE ADDITIONAL EVIDENCE WITHOUT GIVING PROPER REASONS AND FAILED I N APPRECIATING THAT ITA NO. 228/JP/2012 ITO V S. HARPHOOL JAT, JAIPUR 5 ASSESSEES NON COOPERATION WAS A DESIGN TO AVOID SC RUTINY. THE RELEVANT OBSERVATIONS FINDINGS OF LD. CIT(A) IN ADMISSION TH EREOF ARE AS UNDER: 3.3.1. HOWEVER AT THE APPELLATE STATE, REGAR DING THE CREDITWORTHINESS THE LD. AR FURTHER SUBMITTED T HAT SHRI BABU LAL JAT AND SHRI HANUMAN SAHAI JAT HAVE ADVANCED THE LOANS OUT OF THE CONSIDERED RECEIVED AGAINST THE SALE OF THEIR AGRICULTURAL LAN D AD SUCH TRANSACTIONS WERE ENTERED THROUGH BANKING CHANNEL ONLY. IN THIS REGARD, APART FROM THE CONFIRMATIONS OF THE ACCOUNT, SALE DEEDS OF THEIR A GRICULTURAL LANDS AND ALSO BANK PASSBOOKS OF THE CREDITORS AND ASSESSEE WERE S UBMITTED, AS ADDITIONAL EVIDENCE U/R 46A OF THE ACT. SINCE THESE DOCUMENTS WERE FOUND CRUCIAL AND DIRECTLY RELATED TO THE ISSUE UNDER CONSIDERATION, THEREFORE, THESE WERE ADMITTED AFTER GIVING AN OPPORTUNITY TO THE AO TO E XAMINE SUCH ADDITIONAL EVIDENCES AND SUBMIT HIS COMMENTS/ REPORTS IN THIS REGARD. 2.5 LD. DR PLEADS THAT FOR ADMISSION OF ADDITIONAL EVIDENCE STATUTORY PROVISIONS ARE PRESCRIBED UNDER RULE 46A OF INCOME TAX RULES. THE LD. CIT(A) WITHOUT MENTIONING PROPER REASONS FOR ADMIS SION OF ADDITIONAL EVIDENCE HAS MERELY HELD THAT THE DOCUMENTS GO TO T HE ROOT OF MATTER AND ADMITTED THEM. THE REASONS AS GIVEN BY THE ASSESSEE IN HIS APPLICATION FOR ADDITIONAL EVIDENCE ALSO HAVE NO OBJECTIVITY OR CRE DIBILITY. RELEVANT PORTION OF THE APPLICATION DTD. 15-07-2011 IS AS UNDER: . IN THIS CONNECTION IT IS HUMBLY SUBMITTED THAT THE ASSESSEE IS BASICALLY A FARMER AND HIS MAIN SOURCE OF INCOME IS FROM AGRICULTURE ONLY. THE ASSESSEE IS POORLY LITERATE. HENCE, HE WAS COMPLETELY DEPENDED UPON THE A/R. THE DISCUSSION WI TH THE A/R AND UNDERSTANDING THE REQUIREMENT MADE, ITSELF WOUL D HAVE TAKEN AT LEAST TWO DAYS TIME LIVE ASIDE FURTHER TIM E FOR COLLECTION THEREOF. THE PAPERS BELONGED TO THE CRED ITORS. BANK PASSBOOK WERE TO BE GOT COMPLETED FROM THE BANKS. T O MAKE ITA NO. 228/JP/2012 ITO V S. HARPHOOL JAT, JAIPUR 6 COMPLIANCE SHORT PERIOD OF THREE DAYS WAS NOT PRACT ICALLY POSSIBLE. THE AO COMMENCED THE PROCEEDINGS AT A FAG END WHEN LIMITATION WAS GOING TO EXPIRE THUS AFFORDED NO REASONABLE OR ADEQUATE OPPORTUNITY TO ADDUCE ADDITI ONAL EVIDENCES. IN THESE CIRCUMSTANCES, THE EVIDENCE THO UGH AVAILABLE COULD NOT BE FILED. 4. THESE EVIDENCES GO TO THE ROOF OF THE ISSUES AND ARE QUIRE ESSENTIAL FOR A JUST DECISION.. 2.6 LD. CIT(A) WITHOUT APPRECIATING THE NON-COOPER ATIVE ATTITUDE OF THE ASSESSEE AND IGNORING AOS VEHEMENT OBJECTIONS TO AD MISSION OF ADDITIONAL EVIDENCE HAS GRANTED SUBSTANTIAL RELIEF TO THE ASS ESSEE . 2.7 THE REVENUE IS AGGRIEVED ON THIS COUNTS. I. THAT THE LD. CIT(A) HAS ADMITTED THE ADDITIONAL EVI DENCE WITHOUT COMPLYING WITH THE STATUTORY CONDITIONS UND ER RULE 46A OF INCOME TAX RULES. II. NO JUSTIFICATION HAS BEEN GIVEN AS TO WHY THE ADDI TIONAL EVIDENCE IS BEING ADMITTED. III. LD. CIT(A) HAS OVERLOOKED THE NON-COOPERATIVE ATTIT UDE OF THE ASSESSEE IN THE ASSESSMENT PROCEEDINGS. IV. THE AO WAS NOT GIVEN PROPER OPPORTUNITY VIS-A-VIS A DDITIONAL EVIDENCE. ITA NO. 228/JP/2012 ITO V S. HARPHOOL JAT, JAIPUR 7 2.8 THE LD. DR RELIED ON ITAT LUCKNOW BENCH DECISI ON IN THE CASE OF DCIT VS. YOG INTERNATIONAL (P) LTD. (ITA NO. 624/LK W/2010 FOR A.Y. 2004-05 DATE OF ORDER 28-05-2013 ) WHERE ON SIMILAR CIRCUMSTANCES ADMISSION OF ADDITIONAL EVIDENCE BY LD. CIT(A)HAS B EEN OVERRULED. 2.9 THE LD. COUNSEL FOR THE ASSESSEE ON THE OTHER H AND CONTENDS THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE AO REQUIRED THE ASSESSEE TO FILE THESE PAPERS ON 22-12-2009 VIDE HIS SUMMON DATED 18-12-2009 WHICH WAS SERVED ON 19-12-2009 ALLOWING THREE DAYS TIME. THE DOCUMENTS COULD NOT BE OBTAINED FROM THE BANK. IT IS FURTHER PLEADE D THAT THE AO WAS GIVEN SUFFICIENT OPPORTUNITY WHICH IS EVIDENT FROM THE RE MAND REPORT DATED 8-12- 2011. THUS THERE IS NO MERIT IN THE REVENUES GRIEV ANCE THAT SUFFICIENT OPPORTUNITY WAS NOT GIVEN TO AO. THE ASSESSEE THOUG H EXPRESSED HIS INABILITY TO PRODUCE THE CREDITORS AS REQUIRED BY T HE AO AT NOSTAGE ASSESSEE WAS REQUIRED TO FILE FURTHER EVIDENCE TO EXPLAIN TH E LOANS TAKEN FROM SHRI BABU LAL JAT AND HANUMAN SAHAHI JAT DURING THE HEAR ING. RELIANCE WAS PLACED ON FOLLOWING JUDGMENTS IN THIS BEHALF. 1. CIT VS. K RAVINDRANATHAN NAIR (2004) 265 ITR 217 (KER.) 2. SMT. PRABHAVATI S.SHAH VS. CIT (1998) 231 ITR 1 (BOM.) 3. SHAHRUKH KHAN VS. DCIT (2007) 13 SOT 61 (MUM.) 4. JHAVERIBHAI BIHARI LAL & CO. VS. CIT (1985) 154 ITR 591 (PAT.) 5. CIT VS. TAJ BOREWELLS (2007) 291 ITR 232 (MAD.) 6. CIT VS. BABU LAL JAIN(1989) 176 ITR 411 (M.P.) 7. ARAWALI TRADING VS. ITO (2008) 220 CTR 622 (RAJ. ) ITA NO. 228/JP/2012 ITO V S. HARPHOOL JAT, JAIPUR 8 2.10 LD. CIT(A)S ORDER AND ASSESSES WRITTEN SUBMIS SIONS IN THIS BEHALF ARE RELIED ON. 2.11 WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSE D THE MATERIALS AVAILABLE ON RECORD. AS THE FACTS EMERGE FROM THE R ECORD, THERE WAS NON- COOPERATIVE ATTITUDE OF THE ASSESSEE DURING THE COU RSE OF ASSESSMENT PROCEEDINGS WHICH IS CLEAR FROM REPEATED NON ATTEND ANCE MENTIONED IN ASSESSMENT ORDER WHICH HAVE NOT BEEN DISPUTED EITHE R. LD. COUNSEL FOR THE ASSESSEE HAS ADVANCED THE SAME VAGUE AND NON-SPEAKI NG REASONS THAT THE ASSESSEE IS BASICALLY A FARMER AND HAVING SOURCE OF INCOME FROM AGRICULTURE. IN OUR CONSIDERED VIEW, THE ADDITIONAL EVIDENCE CAN NOT BE ADMITTED MERELY ON VAGUE AND NON-SPEAKING ASSERTIONS. STATUTE PROVI DES SPECIFIC CONDITIONS FOR ADMISSION THEREOF. THEY HAVE BEEN REPEATEDLY IN TERPRETED BY HONBLE HIGHER COURTS INCLUDING HONBLE DELHI HIGH COURT JU DGMENT IN THE CASE OF MANISH BUILDWELL 245 CTR 397. THUS IN VIEW OF THESE CIRCUMSTANCES AND FACTS OF THE CASE, THE ADDITIONAL GROUND AS ADMITTE D BY THE LD. CIT(A) LACS FROM PROPER APPRECIATION OF MIND. FROM THE ASSESSEE 'S APPLICATION DATED 15- 07-2011 FILED BEFORE THE LD. CIT(A) FOR ADDITIONAL EVIDENCE, NO REFERENCE WAS MADE EXCEPT THE PRAYER FOR INABILITY TO FILE T HE EVIDENCE BEFORE THE AO . 3. IN THIS CONNECTION IT IS HUMBLY SUBMITTED THAT THE ASSESSEE IS BASICALLY A FARMER AND HIS MAI N SOURCE OF ITA NO. 228/JP/2012 ITO V S. HARPHOOL JAT, JAIPUR 9 INCOME IS FROM AGRICULTURE ONLY. THE ASSESSEE IS P OORLY LITERATE. HENCE, HE WAS COMPLETELY DEPENDED UPON THE A/R. THE DISCUSSION WITH THE A/R AND UNDERSTANDING THE REQUI REMENT MADE, ITSELF WOULD HAVE TAKEN AT LEAST TWO DAYS TIM E LIVE ASIDE FURTHER TIME FOR COLLECTION THEREOF. THE PAPERS BEL ONGED TO THE CREDITORS. BANK PASSBOOK WERE TO BE GOT COMPLETED F ROM THE BANKS. TO MAKE COMPLIANCE SHORT PERIOD OF THREE DAY S WAS NOT PRACTICALLY POSSIBLE. THE AO COMMENCED THE PROCEEDI NGS AT A FAG END WHEN LIMITATION WAS GOING TO EXPIRE THUS AF FORDED NO REASONABLE OR ADEQUATE OPPORTUNITY TO ADDUCE ADDITI ONAL EVIDENCES. IN THESE CIRCUMSTANCES, THE EVIDENCE THO UGH AVAILABLE COULD NOT BE FILED. IN OUR CONSIDERED VIEW THE APPLICATION AS FILED BY THE ASSESSEE DOES NOT SPELL OUT SPECIFIC REASONS FOR HIS INABILITY TO FILE THE EVIDENCE BEFORE AO. THUS IN VIEW OF THE FOREGOING, WE ARE OF THE VIEW THAT THE LD. CIT(A) HAS NOT CONSIDERED THE ISSUE OF ADMISSION OF ADDITIONAL EVI DENCE IN PROPER PERSPECTIVE AND AWARDED SUBSTANTIAL RELIEF. THUS ON THE GIVEN FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE INCLINED TO SET T HE APPEAL BACK TO THE FILE OF THE LD. CIT(A) TO ADJUDICATE THE ISSUE AFRESH AFTER PROVIDING REASONABLE OPPORTUNITY TO BOTH THE PARTIES ON THE ISSUE OF ADM ISSION OF ADDITIONAL EVIDENCE ON THE BASIS OF THE MATERIALS AVAILABLE ON RECORD IN ACCORDANCE WITH RULE 46A OF INCOME TAX RULES. THE LD. CIT(A) AFTER PASSING THE SPEAKING ORDER IN THIS BEHALF WILL DECIDE THE MERITS SUBJECT TO OUTCOME OF ADDITIONAL EVIDENCE. CONSEQUENTLY MERITS OF THE ISSUES ARE NOT DECIDED BY US. ITA NO. 228/JP/2012 ITO V S. HARPHOOL JAT, JAIPUR 10 3.0 IN THE RESULT, THE APPEAL OF THE REVENUE IS ALL OWED FOR STATISTICAL PURPOSES AS PRONOUNCE IN THE OPEN COURT ON 28-11-2 014. SD/- SD/- (T.R. MEENA) (R.P. TOLANI) ACCOUNTANT MEMBER JUDICIAL MEMBER JAIPUR DATED: 28 TH NOV. 2014 *MISHRA COPY FORWARDED TO:- 1.THE ITO, WARD- 7 (2), JAIPUR 2. SHRI HARPHOOL JAT, JAIPUR 3. THE LD. CIT(A) 4. THE LD. CIT BY ORDER 5..THE LD. DR 6.THE GUARD FILE (IT NO. 228/JP/2012) AR ITAT, JAIPUR