ITO Ward-42(3) Murshidabad, Murshidabad V. Shri Bikash Das, Murshidabad

ITA 245/KOL/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 6179 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 5 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-07-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: misc
• Appeal Filed On: 09-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A BHATTACHARJEE
• Assessee Lawyers: SOUMITRA CHOW DHURY
• Keywords: Reason to believe
• Section: 142(1); 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH : KOLKATA [BEFORE HONBLE SHRI M.BALAGANESH, AM & HONBLE SHR I S.S.VISWANETHRA RAVI, JM] I.T.A NO. 245/KOL/2017 ASSESSMENT YEAR : 2011-1 2 ITO, WARD-42(3), MURSHIDABAD -VS- SHRI BIKASH DAS [PAN: ALHPD 7911 P] (APPELLANT) (RESPO NDENT) FOR THE APPELLANT : SHRI A. BHATTACHAR JEE, ADDL. CIT FOR THE RESPONDENT : SHRI SOUMITRA CHOWDH URY, ADVOCATE DATE OF HEARING : 28.06.2018 DATE OF PRONOUNCEMENT : 13.07.2018 ORDER PER M.BALAGANESH, AM 1. THIS APPEAL BY THE REVENUE ARISES OUT OF THE OR DER OF THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS)-12, KOLKATA [IN SHORT THE LD CI T(A)] IN APPEAL NO.154/CIT(A)- 12/KOL/WARD-42(3)/2015-16 DATED 18.11.2016 AGAINST THE ORDER PASSED BY ITO, WARD- 42(3), MURSHIDABAD [ IN SHORT THE LD AO] UNDER SECT ION 147/143(3) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) DATED 29.01.2016 FO R THE ASSESSMENT YEAR 2011-12. 2. THE ONLY EFFECTIVE ISSUE INVOLVED IN THIS APPEAL OF THE REVENUE IS AS TO WHETHER THE LD CITA WAS JUSTIFIED IN HOLDING THE RE-ASSESSMENT FRA MED IN THE HANDS OF THE ASSESSEE AS BAD IN LAW, IN THE FACTS AND CIRCUMSTANCES OF THE C ASE. 2 ITA NO.245/KOL/2017 SHRI BIKASH DAS A.YR. 2011-12 2 3. THE BRIEF FACTS OF THIS APPEAL IS THAT A NOTICE U/S 148 OF THE ACT DATED 15.10.2014 WAS SERVED ON THE ASSESSEE ON 17.10.2014 ON THE GROUND THAT THERE WERE CERTAIN CASH DEPOSITS IN THE BANK ACCOUNT MAINTAINED WITH AXIS BANK , BER HAMPORE BRANCH FOR THE FINANCIAL YEAR 2010-11 TO THE TUNE OF RS 76,35,000/- BASED O N AIR INFORMATION AND ACCORDINGLY, THE LD AO CONCLUDED THAT HE HAD REASON TO BELIEVE T HAT INCOME HAD ESCAPED ASSESSMENT IN THE HANDS OF THE ASSESSEE. IN RESPONSE TO THE S AID NOTICE U/S 148 OF THE ACT, THE ASSESSEE FILED A LETTER DATED 14.11.2014 STATING TH AT HE IS WORKING AS AN ACCOUNTANT OF A RETAIL SHOP OF SPARE PARTS EARNING RS 3,000/- PER M ONTH AS SALARY AND THAT HIS ANNUAL INCOME WAS ONLY RS 36,000/-. ACCORDINGLY, IT WAS PL EADED BY THE ASSESSEE THAT HE IS NOT OBLIGATED AS PER LAW TO FILE ANY RETURN OF INCOME. THIS REPLY LETTER WAS SOUGHT TO BE TREATED BY THE ASSESSEE AS A REPLY IN RESPONSE TO N OTICE U/S 148 FO THE ACT ISSUED BY THE LD AO. THE LD AO THEREAFTER ON REQUEST OF THE ASSE SSEE ALSO FURNISHED THE REASONS RECORDED FOR REOPENING OF THE ASSESSMENT TO THE ASS ESSEE. THE ASSESSEE DURING THE COURSE OF RE-ASSESSMENT PROCEEDINGS CLAIMED THAT HI S FATHER IS A RICKSHAWPULLER AND HIS MOTHER IS A MAID SERVANT. HE INFORMED THAT SHRI S UMIT CHATTERJEE, S/O SUPRIYO CHATTERJEE , RESIDING AT 4, S.N.BAGCHI ROAD, BERHAM PORE HAD OPENED THE SAID SB ACCOUNT WITH AXIS BANK IN HIS NAME SHOWING PROOF OF IDENTITIES AND EVIDENCES WITHOUT TAKING HIS CONSENT OR SIGNATURE. HE STATED THAT HE WAS RESIDING AT THEIR HOUSE FROM HIS CHILDHOOD WITH HIS MOTHER WHO WAS WORKING THERE AS MAID SERVANT. HE FURTHER STATED THAT THE IDENTITIES AND EVIDENCES IN HIS NAME REQUI RED TO OPEN SUCH BANK ACCOUNT WERE KEPT IN THEIR CUSTODY WHICH WAS USED BY THEM FOR OP ENING THE BANK ACCOUNT. ACCORDINGLY HE COMPLETELY DENIED THE MAINTAINING OF SUCH BANK ACCOUNT AND THE MONIES DEPOSITED THEREON AS NOT BELONGING TO HIM IN THE SU M OF RS 76,35,000/-. THE ASSESSEE FURTHER REITERATED VIDE SEPARATE LETTER DATED 8.6.2 015 OPPOSING THAT HE IS NOT HOLDER OF BANK ACCOUNT IN AXIS BANK AND ALSO ENCLOSED A COPY OF COMPLIANT LODGED AGAINST SHRI SUMIT CHATERJEE (PAN AHDPC4883D) BY HIM BEFORE BERH AMPORE POLICE STATION VIDE GDE / CASE NO. 2384 DATED 23.5.2013. THE ASSESSEE ALSO APPEARED PERSONALLY BEFORE THE LD AO AND FILED A WRITTEN SUBMISSION EXPLAINING THE ENTIRE FACTS OF THE CASE WITH A 3 ITA NO.245/KOL/2017 SHRI BIKASH DAS A.YR. 2011-12 3 REQUEST TO DROP THE PROCEEDINGS INITIATED AGAINST H IM AS HIS ANNUAL INCOME IS NOT MORE THAN RS 36,000/- AND BY REITERATING THAT THE DEPOSI TS IN THE AXIS BANK IN THE SUM OF RS 76,35,000/- DOES NOT BELONG TO HIM AND WERE INDEED DONE BY SHRI SUMIT CHATERJEE WITHOUT HIS KNOWLEDGE. THE ASSESSEE AGAIN APPEARE D BEFORE THE LD AO ON 10.12.2015 AND FILED A WRITTEN SUBMISSION REITERATING THE EARL IER SUBMISSIONS AND ALSO FILED AN AFFIDAVIT DATED 14.10.2015 CONFIRMING THE SUBMISSIO NS ALREADY MADE. THE ASSESSEE AGAIN APPEARED BEFORE THE LD AO ON 15.1.2016 AND 27 .1.2016. THE LD AO HOWEVER HELD THAT THE CASH DEPOSITS IN THE SUM OF RS 76,35,000/- MADE IN THE BANK ACCOUNT STOOD UNEXPLAINED BY THE ASSESSEE AND THE STATEMENTS OF T HE ASSESSEE IS SUB-JUDICE AND HENCE CANNOT BE ACCEPTED UNTIL AND UNLESS THE GDE/ CASE N O. 2384 DATED 23.5.2013 OF BERHAMPORE POLICE STATION IS SETTLED , ESTABLISHING THAT THE HOLDER OF THE BANK ACCOUNT IS SHRI SUMIT CHATTERJEE AND NOT THE ASSESSEE HEREIN. ACCORDINGLY THE SUM OF RS 76,35,000/- (REPRESENTING CASH DEPOSITS) AND RS 750 /- (REPRESENTING INTEREST) WERE ADDED TO THE TOTAL INCOME OF THE ASSESSEE AS HIS INCOME F ROM UNDISCLOSED SOURCES. 4. BEFORE THE LD CITA, THE ASSESSEE RAISED A PRELIM INARY OBJECTION THAT THE NOTICE U/S 143(2) OF THE ACT WAS NEVER ISSUED AND SERVED ON TH E ASSESSEE BEFORE THE COMPLETION OF RE-ASSESSMENT PROCEEDINGS EVENTHOUGH THE ASSESSEE H AD DULY SUBMITTED A WRITTEN REPLY IN RESPONSE TO NOTICE U/S 148 OF THE ACT AS EARLY A S 14.11.2014 ITSELF ( I.E WITHIN 30 DAYS FROM THE ISSUE OF NOTICE) . THE LD CITA CALLED FOR A REMAND REPORT FROM THE LD AO IN THIS REGARD , WHEREIN THE LD AO STATED AS UNDER:- NOTICE U/S 148 OF THE IT ACT 1961 WAS ISSUED UPON THE ASSESSEE ON 15.10.2014 AND SERVED ON HIM WITH HIS SIGNATURE ON 17.10.2014 WITH THE DEPARTMENTAL NOTICE SERVER AND THE NOTICE U/S 142(1) WAS ISSUED ON 06.1 0.2015 AND SERVED BY POST (WITH ACKNOWLEDGEMENT). IN RESPONSE OF THE SAID NO TICES THE ASSESSEE APPEARED WITHOUT SUBMISSION OF ANY RETURN OF INCOME . HE SUB MITTED SOME OTHER DOCUMENTS AND AN AFFIDAVIT. AS NO RETURN OF INCOME WAS SUBMIT TED IN RESPONSE OF THE NOTICE U/S 148 AND 142(1) , THERE WAS NO SCOPE FOR THE ISS UANCE OF NOTICE U/S 143(2). 4 ITA NO.245/KOL/2017 SHRI BIKASH DAS A.YR. 2011-12 4 5. THE LD CITA ON PERUSAL OF THE RECORDS AND THE FA CTS OF THE PRESENT CASE, FOUND THAT NO NOTICE WAS ISSUED U/S 143(2) OF THE ACT BY THE LD A O AFTER THE ISSUANCE OF NOTICE U/S 148 OF THE ACT AND ACCORDINGLY CANCELLED THE REASSESSME NT FRAMED BY THE LD AO IN THE HANDS OF THE ASSESSEE AS BAD IN LAW. AGGRIEVED, THE REVE NUE IS IN APPEAL BEFORE US. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS. THE PRELIM INARY ISSUE TO BE DECIDED IS WHETHER THE RE-ASSESSMENT FRAMED BY THE LD AO WITHOUT ISSUA NCE OF NOTICE U/S 143(2) OF THE ACT AFTER THE ISSUANCE OF NOTICE U/S 148 OF THE ACT, CO ULD BE HELD TO BE VALID AS PER LAW. WE FIND THAT THE NOTICE U/S 148 OF THE ACT WAS SERVED ON THE ASSESSEE ON 17.10.2014. THE ASSESSEE VIDE HIS LETTER DATED 14.11.2014 ( I.E WIT HIN 30 DAYS FROM THE DATE OF ISSUE) HAD SUBMITTED A REPLY THAT HIS ANNUAL INCOME IS ONLY RS 36,000/- AND ACCORDINGLY NOT OBLIGATED TO FILE RETURN OF INCOME. IT WAS FURTHER PLEADED IN THE SAID LETTER THAT THE SAID REPLY MAY BE TREATED AS A REPLY FILED IN RESPONSE T O NOTICE U/S 148 OF THE ACT. IN OUR CONSIDERED OPINION, THE SAID REPLY WOULD HAVE TO BE EFFECTIVELY CONSTRUED AS NIL RETURN FILED BY THE ASSESSEE AS ACCORDING TO LAW, HE WAS N OT OBLIGATED TO FILE RETURN OF INCOME. THE ASSESSEE HAD DULY RESPONDED TO THE NOTICE U/S 1 48 OF THE ACT. WE FURTHER FIND THAT THE LD AO HAD DULY TAKEN COGNIZANCE OF THIS LETTER DATED 14.11.2014 OF THE ASSESSEE AND HAD FURTHER PROCEEDED WITH THE RE-ASSESSMENT PROCEE DINGS BY DULY FURNISHING THE REASONS RECORDED FOR REOPENING THE ASSESSMENT BASED ON REQUEST MADE BY THE ASSESSEE IN THAT REGARD. HENCE IT CANNOT BE SAID THAT THE ASSE SSEE HAD NOT REPLIED TO THE NOTICE U/S 148 OF THE ACT. IN THESE FACTS AND CIRCUMSTANCES, IT IS INCUMBENT ON THE PART OF THE LD AO TO ISSUE SEPARATE NOTICE U/S 143(2) OF THE ACT B Y TREATING THE LETTER DATED 14.11.2014 CONTAINING THE INCOME DETAILS OF THE ASSESSEE, AS R ETURN FILED IN RESPONSE TO NOTICE U/S 148 OF THE ACT. IT IS NOT IN DISPUTE THAT THE NOTI CE U/S 143(2) OF THE ACT WAS NEVER ISSUED AND SERVED ON THE ASSESSEE AFTER THE ISSUANCE OF NO TICE U/S 148 OF THE ACT. WE FIND THAT THE HONBLE JURISDICTIONAL HIGH COURT IN ITS RECENT JUDGEMENT IN THE CASE OF PCIT VS OBEROI HOTELS PVT LTD IN ITAT NO. 152 OF 2015 GA NO . 3671 OF 2015 DATED 22.6.2018 BY PLACING RELIANCE ON THE DECISION OF HONBLE SUPR EME COURT IN THE CASE OF CIT VS 5 ITA NO.245/KOL/2017 SHRI BIKASH DAS A.YR. 2011-12 5 HOTEL BLUE MOON REPORTED IN 321 ITR 362 (SC) HAD HE LD THAT ISSUANCE AND SERVICE OF NOTICE U/S 143(2) OF THE ACT WITHIN THE PRESCRIBED TIME IS MANDATORY IN NATURE AND NON- COMPLIANCE OF THE SAME CANNOT BE CURED EVEN U/S 292 BB OF THE ACT . HENCE RESPECTFULLY FOLLOWING THE SAID DECISION AND IN VIE W OF THE UNDISPUTED FACT THAT NO NOTICE U/S 143(2) OF THE ACT WAS ISSUED AND SERVED ON THE ASSESSEE, WE FIND NO INFIRMITY IN THE ORDER OF THE LD CITA CANCELLING THE RE-ASSESSMENT O RDER AS UNSUSTAINABLE IN LAW. ACCORDINGLY, THE GROUNDS RAISED BY THE REVENUE ARE DISMISSED. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE COURT ON 13.07.2018 SD/- SD/- [S.S. VISWANETHRA RAVI] [ M.BAL AGANESH ] JUDICIAL MEMBER ACCOUNTANT MEM BER DATED : 13.07.2018 SB, SR. PS COPY OF THE ORDER FORWARDED TO: 1. ITO, WARD-42(3), MURSHIDABAD, 39, R.N. TAGORE RO AD, P.O.-BERHAMPORE, DIST. MURSHIDABAD, PIN-742101. 2. SHRI BIKASH DAS, SUBHASH PALLY, BERHAMPORE,, DIS T. MURSHIDABAD, PIN-742101. 3..C.I.T.(A)- 4. C.I.T .- KOLKATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER SENIOR PRIVAT E SECRETARY HEAD OF OFFICE/D.D.O., ITAT, KOLKATA BENCHE S