Sunjay Jain, New Delhi V. ITO, New Delhi

ITA 2367/DEL/2011

• Counselvise Citation: 236720114 RSA 2011
• Duration Of Justice: 7 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-12-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 29-11-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 10-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S MOHANTHY

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH G NEW DELHI) BEFORE SHRI RAJPAL YADAV AND SHRI A.N. PAHUJA ITA NO.2367/DEL/2011 ASSESSMENT YEAR: 2007-08 SUNJAY JAIN, VS. INCOME-TAX OFFICER, C-131, PREET VIHAR, WARD 36(2), NEW DELHI-1100 92 NEW DELHI. (PAN: ADIPJ7804Q) (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI VK BINDA L, CA RESPONDENT BY: SMT. S. MOHANTHY , SR.DR DATE OF HEARING : 29.11.2011 DATE OF PRONOUNCEMENT : 16.12.2011 ORDER PER RAJPAL YADAV: JUDICIAL MEMBER THE ASSESSEE IS IN APPEAL BEFORE US AGAINST THE OR DER OF LEARNED CIT(APPEALS) DATED 31.01.2011 PASSED FOR ASSESSMENT YEAR 2007-08. THE GROUNDS OF APPEALS TAKEN BY THE ASSESSEE ARE NOT IN CONSONANCE WITH RULE 8 OF THE ITAT'S RULES, THEY ARE DESCRIPTIVE AND ARGUM ENTATIVE IN NATURE. IN BRIEF, THE GRIEVANCE OF ASSESSEE REVOLVES AROUND TW O ISSUES. IN THE FIRST POINT, HE IS IMPUGNING CONFIRMATION OF ADDITION OF RS.37,2 30 AND UNDER THE SECOND POINT, HE IS IMPUGNING THE CONFIRMATION OF ADDITION OF R.60 LACS UNDER SEC.68 OF THE INCOME-TAX ACT, 1961. 2 2. FIRST WE TAKE UP THE ADDITION OF RS.60,00,000. T HE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL ENGAGE D IN THE BUSINESS OF COMMISSION AGENT IN THE REAL ESTATES. HE HAS FILED HIS RETURN OF INCOME FOR ASSESSMENT YEAR 2007-08 ON 31.3.2008 DECLARING TOTA L INCOME OF RS.2,54,119. ACCORDING TO THE ASSESSING OFFICER, HI S CASE WAS SELECTED FOR SCRUTINY ASSESSMENT AND A NOTICE UNDER SEC. 143(2) OF THE INCOME-TAX ACT, 1961 WAS ISSUED AND SERVED UPON THE ASSESSEE ON 22. 7.2008. IN RESPONSE TO THE NOTICE, SHRI SHASHANK JAIN APPEARED BEFORE THE ASSESSING OFFICER. ON SCRUTINY OF THE ACCOUNTS, IT REVEALED TO THE ASSESS ING OFFICER THAT ANNUAL INFORMATION REPORT (AIR WING) HAS SENT AN INFORMATI ON EXHIBITING THAT ASSESSEE HAD SOLD IMMOVEABLE PROPERTIES VALUED AT R S.60 LACS WHOSE SALE DEED HAS BEEN EXECUTED WITH SUB-REGISTRAR-V, GHAZIA BAD ON 21.3.2007. ACCORDING TO THE ASSESSING OFFICER, HE HAD PROVIDED VARIOUS OPPORTUNITIES TO THE ASSESSEE AND DIRECTED HIM TO FURNISH DOCUMENTS ETC., BUT NOTHING WAS PRODUCED BY THE ASSESSEE, THEREFORE, HE MADE AN ADD ITION OF RS.60 LACS. 3. BEFORE THE LEARNED CIT(APPEALS), IT WAS CONTENDE D BY THE ASSESSEE THAT NO NOTICE WAS ISSUED BY THE ASSESSING OFFICER TO HIM IN RESPECT OF THIS TRANSACTION. DURING THE COURSE OF HIS BUSINESS, THE ASSESSEE HAD POWER OF 3 ATTORNEY OF THE PROPERTY ALLEGED TO HAVE BEEN SOLD BY HIM. HE WAS NOT THE OWNER OR IN POSSESSION OF THE PROPERTY. THE AMOUNT WAS RECEIVED THROUGH ACCOUNT PAYEE CHEQUES IN HIS BANK ACCOUNT AND IT WA S TRANSMITTED THROUGH BANK ACCOUNT ON THE NEXT DAY TO THE ORIGINAL OWNER MRS. URMILA GUPTA AND OTHERS. HE PRODUCED COPY OF THE STANDARD CHARTERED BANK, COPYOF THE SALE DEED AND COPY OF THE POWER OF ATTORNEY. LEARNED FIR ST APPELLATE AUTHORITY HAS CALLED FOR A REMAND REPORT AND THEREAFTER REJEC TED THE CONTENTION OF ASSESSEE BY MAKING FOLLOWING OBSERVATIONS: 11.3 I HAVE GONE THROUGH THE FINDINGS OF THE A. O. AS WELL AS THE SUBMISSIONS OF THE APPELLANT. IT IS A FACT ON RECOR D THAT AS PER THE SALE DEED UNEARTHED AFTER DUE INQUIRY BY THE A.O. THE AP PELLANT HAS SUPPRESSED THE FACT OF REGISTRATION OF THE DOCUMENT ON THE SALE OF PROPERTY ENTERED INTO WITH THE SRO. IF NOT FOR THE AIR INFORMATION AND IF NOT FOR THE SCRUTINY ASSESSMENT, THE APPELLA NT WOULD HAVE GONE SCOT FREE WITH THE SUBJECT SALE OF THE PROPERTY. TH E APPELLANT IS THE RECIPIENT OF THE PROCEEDS OF THE SALE OF THE PROPER TY WHICH HAS BEEN DULY CREDITED TO HIS ACCOUNT. THEREFORE, THE RECEI PT OF A SUM OF RS.60 LACS HAS BEEN RIGHTFULLY ASSESSED BY THE A.O. U/S. 68 AS THE APPELLANT FAILED TO PROVIDE ANY INFORMATION RELATING TO THE T RANSACTION. THE ADDITION IS THEREFORE, CONFIRMED. 4. THE LEARNED COUNSEL FOR THE ASSESSEE DREW OUR AT TENTION TOWARDS THE COPY OF THE SALE DEED AVAILABLE ON PAGE NOS. 13 TO 43 AND SUBMITTED THAT IT 4 CLEARLY REVEALS THAT HE IS A POWER OF ATTORNEY HOLD ER. HE HAS DREW OUR ATTENTION TOWARDS PHOTOCOPY OF THE POWER OF ATTORNE Y GIVEN BY MRS. URMILA GUPTA WHICH IS AVAILABLE ON PAGES 44 TO 47 OF THE P APER BOOK. ON THE STRENGTH OF THESE DOCUMENTS, HE SUBMITTED THAT THE FINDINGS RECORDED BY THE REVENUE AUTHORITIES BELOW ARE FACTUALLY INCORRECT. HE ALSO DREW OUR ATTENTION TOWARDS THE BANK STATEMENT DEMONSTRATING THE TRANSMISSION OF FUNDS FROM HIS ACCOUNT TO THE ACCOUNT OF MRS. URMIL A GUPTA THROUGH ACCOUNT PAYEE CHEQUES. 5. ON THE OTHER HAND, LEARNED DR RELIED UPON THE OR DERS OF THE REVENUE AUTHORITIES BELOW. 6. WE HAVE DULY CONSIDERED THE RIVAL CONTENTIONS AN D GONE THROUGH THE RECORD CAREFULLY. ADMITTEDLY, ASSESSEE HAS NOT PROD UCED THESE DOCUMENTS BEFORE THE ASSESSING OFFICER. THE PHOTOSTAT COPY OF THE SALE DEED AS WELL AS COPY OF POWER OF ATTORNEY HAVE BEEN PRODUCED BEFORE US. A PERUSAL OF THESE DOCUMENTS WOULD SHOW THAT ASSESSEE WAS NOT THE OWNE R OF THE PROPERTY. HE HAS EXECUTED THE SALE DEED IN A REPRESENTATIVE CAPA CITY AS AN AGENT OF THE LAND OWNER MRS. URMILA GUPTA AND OTHERS. LEARNED FI RST APPELLATE AUTHORITY HAS MISERABLY FAILED TO CONSIDER THE SALE DEED AND HAS ERRED IN HOLDING THE ASSESSEE AS OWNER OF THE PROPERTY. THE AMOUNT OF RS.60 LACS 5 THOUGH CREDITED TO THE ACCOUNT OF THE ASSESSEE BUT IMMEDIATELY ON THE NEXT DAY, IT WAS TRANSMITTED TO THE ACCOUNT OF MRS. URMI LA GUPTA WHO WAS THE OWNER OF THE PROPERTY SOLD. IN SUCH SITUATION, ADDI TION IN THE HANDS OF THE ASSESSEE CANNOT BE MADE. BUT SINCE THESE ASPECTS HA VE NOT BEEN GONE INTO BY THE ASSESSING OFFICER, BECAUSE ASSESSMENT ORDER IS AN EX PARTE ORDER. THESE DOCUMENTS COULD NOT BE VERIFIED BY THE ASSESSING OF FICER AND THEIR GENUINENESS REMAINED TO BE DECIDED LOGICALLY. THERE FORE, IN THE INTEREST OF JUSTICE, WE DEEM IT FIT TO SET ASIDE THIS ISSUE TO THE FILE OF THE ASSESSING OFFICER FOR READJUDICATION. THE ASSESSEE WILL BE AT LIBERTY TO PRODUCE ANY EXPLANATION OR DOCUMENT BEFORE THE ASSESSING OFFICE R FOR EXPLAINING HIS POSITION. LEARNED ASSESSING OFFICER SHALL ADJUDICAT E THE ISSUE AFTER PROVIDING DUE OPPORTUNITY OF HEARING TO THE ASSESSEE. IF HE H AS ANY DOUBT ABOUT THE VERACITY OF THE SALE DEED OR THE POWER OF ATTORNEY THEN HE CAN CALL FOR THESE DOCUMENTS DIRECTLY FROM THE REGISTERING AUTHORITIES . HE WILL ENSURE THE OWNERSHIP OF THE PLOT SOLD THROUGH THIS SALE DEED A ND THEREAFTER ADJUDICATE THE ISSUE. IT IS NEEDLESS TO SAY THAT THE OBSERVATI ONS MADE BY US WILL NOT IMPAIR OR INJURE THE CASE OF A.O. OR WOULD NOT CAUS E ANY PREJUDICE TO THE DEFENCE/EXPLANATION OF THE ASSESSEE. 6 7. NOW, WE TAKE THE ISSUE REGARDING DISALLOWANCE OF RS.37,230 CONFIRMED THE LEARNED CIT(APPEALS). ASSESSING OFFIC ER FOUND THAT THE ASSESSEE HAD CLAIMED DEDUCTION OF RS.37,230 UNDER C HAPTER VIA ON ACCOUNT OF TUITION FEE PAID FOR THE EDUCATION OF THE CHILDR EN. THE ASSESSEE DID NOT PRODUCE ANY DOCUMENTARY EVIDENCE IN SUPPORT OF SUCH PAYMENT AND ACCORDINGLY ASSESSING OFFICER DISALLOWED THE CLAIM OF THE ASSESSEE. 8. BEFORE THE LEARNED CIT(APPEALS), ASSESSEE HAS SU BMITTED THE DETAILS OF THE BANK STATEMENT EXHIBITING THE PAYMENT OF THI S AMOUNT AS A FEES. LEARNED FIRST APPELLATE AUTHORITY DID NOT ACCEPT TH E CONTENTION OF THE ASSESSEE ON THE GROUND THAT EVIDENCE DEPICTING THE DEBIT ENTRIES IN THE BANK ACCOUNT OF PARTICULAR AMOUNT CANNOT BE SUFFICIENT F OR DEMONSTRATING THAT THESE WERE PAID FOR TUITION FEES. 9. WITH THE ASSISTANCE OF LEARNED REPRESENTATIVES, WE HAVE GONE THROUGH THE RECORD CAREFULLY. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSING OFFICER HAS NOT ISSUED ANY SPECIFIC NOTIC E IN THIS CONNECTION. HE HAS ISSUED NOTICE UNDER SEC. 143(2) OF THE ACT IN J ULY 2008 BUT DID NOT ISSUE NOTICE SPECIFICALLY ABOUT ALL THESE DISALLOWANCE DU RING THE ASSESSMENT PROCEEDINGS, THEREFORE, THE OPPORTUNITY TO PRODUCE NECESSARY EVIDENCE WAS 7 NOT GRANTED TO THE ASSESSEE. ON THE OTHER HAND, LEA RNED DR POINTED OUT THAT EVEN BEFORE THE LEARNED CIT(APPEALS), ASSESSEE FAIL ED TO SUBMIT THE REQUISITE DETAILS. ON DUE CONSIDERATION OF THE FAC TS AND CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE ASSESSEE REMAINED UNDER TH E IMPRESSION THAT EVIDENCE IN THE SHAPE OF BANK STATEMENT WOULD BE A SUFFICIENT EVIDENCE FOR DEMONSTRATING THE FEES TOWARDS THE SCHOOL. SINCE WE ARE SETTING ASIDE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER WITH RES PECT TO ADDITION OF RS.60 LACS MADE ON ACCOUNT OF SALE OF PROPERTY AT GHAZIAB AD, WE REMIT THIS ISSUE ALSO TO THE FILE OF THE LEARNED ASSESSING OFFICER F OR READJUDICATION. ASSESSEE WILL BE AT LIBERTY TO PRODUCE ANY EVIDENCE IN SUPPO RT OF HIS EXPLANATION. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED FOR STATISTICAL PURPOSES. DECISION PRONOUNCED IN THE OPEN COURT. SD/- SD/- ( A.N. PAHUJA ) ( RAJPAL YADAV ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 16/12/2011 MOHAN LAL 8 COPY FORWARDED TO: 1) APPELLANT 2) RESPONDENT 3) CIT 4) CIT(APPEALS) 5) DR:ITAT ASSISTANT REGISTRAR