Varun Garg, Ghaziabad V. DCIT, Ghaziabad

ITA 2512/DEL/2017

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 2332 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 7 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-12-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Assessment Year: 2011-2012
• Appeal Filed On: 26-04-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S S RANA
• Assessee Lawyers: VIPIN GARG; KRISHNA GOEL S
• Keywords: Salary income; Opportunity of being heard; Principle of natural justice; Cost of acquisition

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : G : NEW DELHI BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER ITA NO.2512/DEL/2017 ASSESSMENT YEAR: 2011-12 VARUN GARG, R-2/57, RAJ NAGAR, GHAZIABAD. PAN: AHVPG2255K VS DCIT, CIRCLE-2, CGO-II, HAPUR ROAD, GHAZIABAD. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI VIPIN GARG & SHRI KRISHNA GOEL, ADVOCATES REVENUE BY : SHRI S.S. RANA, CIT, DR DATE OF HEARING : 04.12.2019 DATE OF PRONOUNCEMENT : 06.12.2019 ORDER PER R.K. PANDA, AM: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 28.02.2017 OF THE CIT(A), GHAZIABAD, RELATING TO AS SESSMENT YEAR 2011-12. 2. ALTHOUGH A NUMBER OF GROUNDS HAVE BEEN RAISED BY THE ASSESSEE, THEY ALL RELATE TO THE ORDER OF THE CIT(A) IN SUSTAINING THE ADDITION OF RS.3,93,050/- MADE BY THE ASSESSING OFFICER. ITA NO.2512/DEL/2017 2 3. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESS EE IS AN INDIVIDUAL AND DERIVES INCOME FROM SALARY, INTEREST, ETC. A SEARCH WAS CA RRIED OUT IN THE CASE OF THE ASSESSEE ON 23 RD AUGUST, 2012. SUBSEQUENTLY, LOCKER NO.77 WITH BAN K OF BARODA, RAJ NAGAR, GHAZIABAD WAS CONDUCTED. THE LOCKER WAS IN THE JOINT NAME OF THE ASSESSEE AND HIS WIFE SMT. PRIYANSHI AGARWAL. IN R ESPONSE TO THE NOTICE U/S 153A, THE ASSESSEE FILED RETURN OF INCOME DECLARING INCOM E OF RS.18 LAKHS. THE ASSESSING OFFICER, DURING THE COURSE OF ASSESSMENT PROCEEDINGS, NOTED FROM THE STATEMENT OF AFFAIRS THAT THE ASSESSEE HAS PURCHASE D A PROPERTY AT DASNA, GHAZIABAD, WHICH IS SHOWN AT RS.56,25,000/-. FROM THE PERUSAL OF THE PURCHASE DEED, HE NOTED THAT THE PURCHASE VALUE IS RS.56,10, 000/-, STAMP DUTY AND OTHER EXPENSES IS RS.3,93,000/- AND REGISTRATION EXPENSES IS RS.10,050/- EXCLUDING LEGAL EXPENSES PAID BY THE ASSESSEE. THUS, THE TOTAL INV ESTMENTS COMES TO RS.60,13,050/. SINCE THE ASSESSEE HAD SHOWN THE INVESTMENT OF RS.5 6,25,000/- ONLY, THE ASSESSING OFFICER MADE ADDITION OF RS.3,93,050/- BEING THE UN EXPLAINED INVESTMENT MADE BY THE ASSESSEE. IN APPEAL, THE LD.CIT(A) UPHELD THE ACTION OF THE ASSESSING OFFICER. 4. AGGRIEVED WITH SUCH ORDER OF THE CIT(A), THE ASS ESSEE IS IN APPEAL BEFORE THE TRIBUNAL RAISING THE FOLLOWING GROUNDS:- I. BECAUSE THE LD CIT (A) HAS ERRED IN FACTS AND LAW IN CONFIRMING THE ADDITIONS MADE BY LD.AO OF RS. 3,93,050/-. II. BECAUSE THE LD. CIT (A) HAS ERRED IN FACTS AND LAW WHILE CONFIRMING THE ADDITION OF RS. 3,93,050/- AND REJECTING THE GR OUND TAKEN BY THE APPELLANT THAT IT WAS A CASE OF COMPLETED ASSESSMENT AND SQUA RELY COVERED BY THE DECISION OF DELHI HIGH COURT IN THE CASE OF KABUL C HAWLA (380 ITR 573). ITA NO.2512/DEL/2017 3 III. BECAUSE THE LD CIT (A) HAS ERRED IN FACTS AND LAW IN CONFIRMING THE ADDITIONS MADE BY LD. AO OF RS. 3,93,050/- REJECTIN G THE GROUND TAKEN BY THE APPELLANT THAT THE ASSESSMENT ORDER WAS MADE WITHOU T ANY ORAL HEARING AND IN GROSS VIOLATION OF PRINCIPLES OF NATURAL JUSTICE. IV. BECAUSE THE LD CIT (A) HAS ERRED IN FACTS AND LAW IN MAKING THE ADDITION OF RS.3,93,050/- PERTAINING TO STAMP DUTY AND REGISTRY EXPENSES ON THE PRESUMPTION THAT THE SAME WAS INCURRED BY THE A PPELLANT AS PURCHASER WHEREAS ON THE FACTS OF THE CASE, THE SAME WAS BORN E BY THE SELLER. V. THAT THE APPELLANT CRAVES THE LEAVE TO ADD, MODI FY, AMEND OR DELETE ANY OF THE GROUNDS OF APPEAL AT THE TIME OF HEARING AND ALL THE ABOVE GROUNDS ARE WITHOUT PREJUDICE TO EACH OTHER. 5. GROUNDS OF APPEAL NO.(I) AND (V) BEING GENERAL I N NATURE ARE DISMISSED. SO FAR AS GROUND NO.(II) IS CONCERNED, WE FIND THE ISS UE STANDS DECIDED AGAINST THE ASSESSEE BY THE DECISION OF THE HON'BLE ALLAHABAD H IGH COURT IN THE CASE OF CIT VS. RAJ KUMAR ARORA (2014) 52 TAXMANN.COM 172 (ALL) AND IN THE CASE OF CIT VS. KESARWANI ZARDA BHANDAR SAHSON ALLAHABAD [ITA NO.27 0 OF 2014 (ALL)]. IN BOTH THE DECISIONS, IT WAS HELD THAT THE ASSESSING OFFIC ER HAS THE POWER TO REASSESS THE RETURNS OF THE ASSESSEE NOT ONLY FOR UNDISCLOSED IN COME FOUND DURING THE COURSE OF SEARCH OPERATION, BUT ALSO WITH REGARD TO THE MATER IAL AVAILABLE AT THE TIME OF ORIGINAL ASSESSMENT. ACCORDINGLY, GROUND NO.(II) RA ISED BY THE ASSESSEE IS DISMISSED. 6. SO FAR AS GROUNDS OF APPEAL NO.(III) AND (IV) AR E CONCERNED, IT IS THE SUBMISSION OF THE LD. COUNSEL THAT THE ASSESSING OF FICER WITHOUT ASKING ANY QUERY AT THE TIME OF ASSESSMENT, MADE THE ADDITION OF THE SAME. ALTHOUGH THE ASSESSEE HAD STATED BEFORE THE CIT(A) THAT THE STAMP DUTY WA S BORNE BY THE SELLER, HOWEVER, HE HAS BRUSHED ASIDE THE SAME. HE SUBMITTED THAT G IVEN AN OPPORTUNITY, THE ITA NO.2512/DEL/2017 4 ASSESSEE IS IN A POSITION TO SUBSTANTIATE THE SAME TO THE SATISFACTION OF THE ASSESSING OFFICER. 7. THE LD. DR, ON THE OTHER HAND, HEAVILY RELIED ON THE ORDER OF THE CIT(A) AND SUBMITTED THAT THE ASSESSEE WAS GIVEN ENOUGH OPPORT UNITIES BEFORE THE ASSESSING OFFICER AND THE CIT(A) AND HE HAS NOT EXPLAINED THE SAME, THEREFORE, THIS MATTER SHOULD BE DECIDED HERE ITSELF AND THE ADDITION MADE BY THE ASSESSING OFFICER AND SUSTAINED BY THE CIT(A) SHOULD BE UPHELD. 8. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES AND PERUSED THE RECORD. FROM THE ORDER OF THE ASSESSING OFFICE R, WE FIND THAT THERE IS NO QUERY RAISED BY THE ASSESSING OFFICER REGARDING THE EXPEN DITURE OF RS.3,93,050/- ON ACCOUNT OF STAMP DUTY, REGISTRATION EXPENSES, ETC. ALTHOUGH THE ASSESSEE BEFORE THE CIT(A) HAS CATEGORICALLY STATED THAT STAMP DUTY EXP ENSES WAS PAID BY THE SELLER OUT OF PART CONSIDERATION OF RS.8,10,000/- PAID IN CASH AND, THEREFORE, NOT ADDED TO THE COST OF ACQUISITION AS PER THE STATEMENT OF AFFAIRS , HOWEVER, THERE IS NO DISCUSSION BY THE CIT(A) ON THIS ISSUE. IT IS THE SUBMISSION OF THE LD. COUNSEL THAT GIVEN AN OPPORTUNITY, HE IS IN A POSITION TO SUBSTANTIATE TH E SAME BEFORE THE ASSESSING OFFICER. CONSIDERING THE TOTALITY OF THE FACTS OF THE CASE AND IN THE INTEREST OF JUSTICE, WE DEEM IT PROPER TO RESTORE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO GRANT AN OPPORTUNITY TO THE ASS ESSEE TO SUBSTANTIATE THE SOURCE OF THE REGISTRATION EXPENSES AND DECIDE THE ISSUE AS P ER FACT AND LAW AFTER GIVING DUE ITA NO.2512/DEL/2017 5 OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE HOLD AND DIRECT ACCORDINGLY. THE GROUNDS RAISED BY THE ASSESSEE ON THIS ISSUE ARE AL LOWED FOR STATISTICAL PURPOSES. 9. IN THE RESULT, THE APPEAL FILED BY THE ASS ESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. THE DECISION WAS PRONOUNCED IN THE OPEN COURT ON 0 6.12.2019. SD/- SD/- (KULDIP SINGH) (R.K. PANDA) JUDICIAL MEMBER ACCO UNTANT MEMBER DATED: 06 TH DECEMBER, 2019 DK COPY FORWARDED TO 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASSTT. REGISTRAR, ITAT, NEW DELHI