SHRI MANOHAR CHATURVEDI, Jaipur V. ITO, Jaipur

ITA 254/JPR/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 99474 (ITAT-JAIPUR)
• Duration Of Justice: 3 year(s) 7 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 15-03-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAJ MEHRA JCIT DHK
• Assessee Lawyers: MANISH AGARWALCA
• Keywords: Opportunity of being heard; Principle of natural justice; Additional evidence
• Section: 144

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH VKJ-IH-RKSYKUH] U;KF;D LNL; ,OA JH FOE FLAG ;KN O] YS[KK LNL; DS LE{K BEFORE: SHRI R.P. TOLANI, JM & SHRI VIKRAM SINGH YA DAV, AM VK;DJ VIHY LA-@ ITA NO. 254/JP/2012 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2008-09 SHRI MANOHAR CHATURVEDI 518, NEMI SAGAR COLONY, VAISHALI MARG, VAISHALI NAGAR, JAIPUR CUKE VS. THE ITO WARD- 3 (1) JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: AAECS 2610 M VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI MANISH AGARWAL,CA, JKTLO DH VKSJ LS@ REVENUE BY : SHRI RAJ MEHRA, JCIT LQUOKBZ DH RKJH[K@ DATE OF HEARING : 03/11/2015 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 06 /11/2015 VKNS'K@ ORDER PER R.P. TOLANI, JM:- THE ASSESSEE HAS FILED AN APPEAL AGAINST THE ORDER OF THE LD. CIT(A)-I, JAIPUR DATED 23-01-2012 FOR THE ASSESSME NT YEAR 2008-09 WHEREIN FOLLOWING GROUND HAS BEEN RAISED BY THE AS SESSEE. 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS GROSSLY ERRED IN SUSTAINING THE ADDITION OF RS. 20,90,800/-TO THE TOTAL INCOME DECL ARED BY THE ASSESSEE ARBITRARILY. 1.1 THE LD. CIT(A) HAS FURTHER ERRED IN REJECTING T HE APPLICATION FILED U/R 46A OF THE INCOME TAX RULES, 1962 FOR THE SOLE REASON OF NON-VERIFICATION WHEN IN FACT AL L SUCH DOCUMENTS ARE DULY VERIFIABLE AND A VERIFIED COPY C OULD HAVE ITA NO. 254/JP/2012 SHRI MANOHAR CHATURVEDI VS. ITO, WARD- 3 (1), JAIPU R . 2 BEEN FILED IF ASKED FOR. HOWEVER, THE EVIDENCE SO S UBMITTED AND ELABORATING DISCUSSED IN THE ORDER DESERVES TO BE ACCEPTED. 1.2 THE LD. CIT(A) HAS FURTHER ERRED IN IGNORING TH E SUBMISSION MADE AND INCOME OFFERED VOLUNTARILY AND SUSTAINED AN ADDITION OF RS. 20,90,800/-. HENCE, TH E ADDITION SO SUSTAINED DESERVES TO BE DELETED. 1.3 THE AO HAS FURTHER ERRED IN NOT ALLOWING THE LOSS SUFFERED BY ASSESSEE FROM TRADING OF SHARES. 2. ALTERNATIVELY AND WITHOUT PREJUDICE TO GROUNDS OF APPEAL ABOVE, THE LD. CIT(A) HAS FURTHER ERRED I N ALLOWING THE BENEFIT OF SET OFF OF RS. 1,99,200/- FROM THE R ECEIPTS OF PROFESSION OF RS. 22,90,000/- WHEN IN FACT RS. 1,99 ,200/- IS THE NET INCOME EARNED AND GROSS RECEIPTS DECLARED A RE RS. 3,67,310/- WHICH DESERVES TO BE CONSIDERED. HENCE, THE APPELLANT IS ENTITLED TO RELIEF OF RS. 3,67,310/- 2.1 ADVERTING TO THIS GROUND NO. 1.1, THE LD. COUNS EL FOR THE ASSESSEE CONTENDS THAT THE ASSESSEE IS AN INDIVIDUAL AND AST ROLOGER BY PROFESSION PERFORMING YOGA, AND OTHER RELIGIOUS / VEDIC PROGRA MS. FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE FILED HIS RETURN OF INC OME AT A TOTAL INCOME OF RS. 1,99,200/- FROM THE AFOREMENTIONED PROFESSION. THE ASSESSMENT IN QUESTION WAS FRAMED U/S 144 OF THE ACT AS THE ASSES SEE BECAME SICK AND APPLIED FOR ADJOURNMENT ALOGNWITH MEDICAL CERTIFICA TE WHICH WAS REJECTED BY THE AO FRAMING ASSESSMENT U/S 144 OF THE ACT BY MAKING AN ADDITION OF RS. 23.85 LACS. 2.2 AGGRIEVED, THE ASSESSEE PREFERRED FIRST APPEAL. SINCE THE ASSESSMENT WAS FAMED EX-PARTE, THE FILED AN APPLICATION FOR AD MISSION OF AN ITA NO. 254/JP/2012 SHRI MANOHAR CHATURVEDI VS. ITO, WARD- 3 (1), JAIPU R . 3 ADDITIONAL EVIDENCE UNDER RULE 46A OF INCOME-TAX RU LES, 1962 SUPPORTED BY VARIOUS PRESCRIPTIONS ISSUED BY KALPATRU HOSPITA L DATED 15-06-2010. THE LD. CIT(A) HOWEVER, REJECTED ASSESSEE'S APPLICA TION UNDER RULE 46A REFUSING TO ACCEPT THE MEDICAL CERTIFICATES WHICH A CCORDING TO HIM WAS OF EARLIER PERIOD WITHOUT CALLING FOR REMAND REPORT AN D NOT ADMITTING THE ADDITIONAL EVIDENCE UNDER RULE 46A. THE LD. CIT(A) MADE VARIOUS OBSERVATIONS ON THE MERITS OF THE ADDITIONAL EVIDEN CE DRAWING ADVERSE INFERENCE WHICH WAS REFUSED BUT THEREAFTER THE LD. CIT(A) ALLOWED PART RELIEF TO THE ASSESSEE. 2.3 AGGRIEVED BY THE ORDER OF THE LD. CIT(A), THE A SSESSEE IS BEFORE US AND IT IS PLEADED THAT THE ASSESSEE FURNISHED FOLLO WING ADDITIONAL EVIDENCE. (I). DETAILS OF CASH DEPOSIT ALONGWITH COPIES OF BANK ACCOUNT STATEMENTS. (II) COPIES OF LEDGER ACCOUNT OF THE ASSESSEE AS AP PEARING IN THE BOOKS OF M/S BNK SECURITIES PVT. LTD. AND IN THE BOOKS OF M/S MAVERICK SHARE BROKERS PVT. LTD. (III) WORKING OF LOSS SUFFERED BY ASSESSEE FROM TRA DING OF SHARES. HOWEVER, THE LD. CIT(A) WITHOUT EVEN BOTHERING TO EXAMINE THESE CRUCIAL EVIDENCES, HAS REJECTED THE A PPLICATION OF ASSESSEE IN A VERY SUMMARY MANNER WITHOUT ANY CO NCRETE BASIS. HOWEVER, LD. CIT(A) ALLOWED THE BENEFIT OF P EAK OF CREDIT AND THEREAFTER, ALLOWED THE DEDUCTION OF INC OME ALREADY DECLARED BY ASSESSEE. THE LD. CIT(A) HAS RE JECTED THE APPLICATION OF ASSESSEE MERELY ON THE FOLLOWING GROUNDS: ITA NO. 254/JP/2012 SHRI MANOHAR CHATURVEDI VS. ITO, WARD- 3 (1), JAIPU R . 4 1. THE COPIES OF LEDGER ACCOUNTS OF THE ASSESSEE CLAIMED TO BE APPEARING IN THE BOOKS OF BNK SECURIT IES P. LTD. AND MAVERICK SHARE BROKERS P. LTD. ARE NOT SIG NED / ATTESTED BY THEM. AUTHENTICITY OF THESE ACCOUNTS IS DOUBTFUL. 2. DETAILS OF PURCHASES AS REFLECTED IN THE LEDGER ACCOUNT OF ASSESSEE IN THE BOOKS OF BNK SECURITIES WITH WITHDRAWALS FROM BANK ACCOUNT ARE NOT RECONCILABLE. 3. ASSESSEE HAS NOT FURNISHED BOOKS OF ACCOUNT, CASH BOOK, P&L ACCOUNT OR BALANCE SHEET. THERE IS N O EVIDENCE TO VERIFY THE CLAIM OF LOSS FROM TRADING I N SHARES PARTICULARLY AS THE PURCHASES SHOWN CANNOT BE VERIF IED FROM HIS BANK ACCOUNT. HAVING OBSERVED SO, THE LD. CIT(A) PROCEEDED TO REJECT THE APPLICATION OF ASSESSEE AND THE ADDITIO NAL EVIDENCE SOUGHT TO BE SUBMITTED WAS HELD INADMISSIB LE ON THE GROUND THAT THE SAME IS NOT SUBJECT TO VERIFICA TION. IN THIS REGARD IT IS HUMBLY SUBMITTED THAT, THE LD. CIT(A) HAS COMMITTED GROSS ILLEGALITY CAUSING INJUS TICE TO THE ASSESSEE IN AS MUCH AS THE LD. CIT(A) HAS NOT F OLLOWED THE PRINCIPLES OF NATURAL JUSTICE, ACCORDING TO WHI CH, THE ASSESSEE SHOULD HAVE BEEN PROVIDED SUFFICIENT OPPOR TUNITY TO ESTABLISH GENUINENESS OF THE DOCUMENTS. IT MUST BE NOTED THAT THE LD. CIT(A) HAS HARDLY MADE ANY EFFORT TO GET TH E DOCUMENTS VERIFIED, AND BEFORE REJECTING THE APPLIC ATION DID NOT EVEN BOTHER TO REMAND THE MATTER TO LD. AO FOR VERIFICATION OF THE EVIDENCES SOUGHT TO BE SUBMITTE D. HOWEVER, THE LD. CIT(A) HAS NOT REMANDED THE MATTER TO LD. AO, RATHER HAS STRAIGHTAWAY PROCEEDED TO REJECT THE APPLICATION OF ASSESSEE ARBITRARILY. THE LD. CIT(A) HAS NOT MADE ANY EFFORT TOWARDS VERIFICATION OF THE EVIDENC ES SOUGHT TO BE SUBMITTED BY ASSESSEE AND HAS DISMISSED ASSES SEES APPLICATION IN LIMINE WITHOUT PROVIDING PROPER OPPO RTUNITY TO ASSESSEE TO ESTABLISH THE GENUINENESS OF THE EVI DENCES AND VERIFY THE SAME. ITA NO. 254/JP/2012 SHRI MANOHAR CHATURVEDI VS. ITO, WARD- 3 (1), JAIPU R . 5 THE LD. COUNSEL FOR THE ASSESSEE CONTENDS THAT IT I S HIGHLY UNJUSTIFIED THAT ON ONE HAND, THE ADDITIONAL EVIDENCE IS TECHNICALLY REJECTED AND ON THE OTHER HAND THE PART OF WHICH HAS BEEN CONSIDERED WH ILE DECIDING THE APPEAL ON MERITS. IN ALL FAIRNESS, THE LD. CIT(A) S HOULD HAVE ADMITTED ADDITIONAL EVIDENCE LOOKING AT THE MEDICAL GROUNDS AND THE ASSESSEE BEING PREVENTED BY SUFFICIENT CAUSE IN SUBMITTING THE EVI DENCE BEFORE THE AO. THUS PRINCIPLES NATURAL JUSTICE HAVE BEEN DENIED TO THE ASSESSEE. IT IS FURTHER CONTENDED THAT IN THE INTEREST OF SUBSTANTI AL JUSTICE, THE EX-PARTE ASSESSMENT MAY BE SET ASIDE AND RESTORED THE MATTE R BACK TO THE FILE OF THE AO TO DECIDE THE SAME AFRESH BY ADMITTING THE A DDITIONAL EVIDENCE AND GIVING ADEQUATE OPPORTUNITY OF BEING HEARD TO T HE ASSESSEE. 2.4 THE LD. DR IS HEARD WHO CONTENDS THAT THE CONDU CT OF THE ASSESSEE WAS NON-COOPERATIVE IN THE ASSESSMENT PROCEEDINGS. THE LD. CIT(A) HAS RIGHTLY REJECTED THE APPLICATION FOR ADDITIONAL EVI DENCE UNDER RULE 46A OF INCOME-TAX RULES.. 2.5 WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE FACTS EMERGE THAT THE ASSE SSEE SUBMITTED THE MEDICAL GROUND FOR ADJOURNMENT BEFORE THE AO ALONGW ITH WITH MEDICAL CERTIFICATE WHICH RELATE TO EX-PARTE ASSESSMENT IN WHICH ALL THE CREDIT ENTRIES WERE ADDED TO THE INCOME OF THE ASSESSEE. B EFORE LD. CIT(A), THE ASSESSEE FILED DETAILED APPLICATION FOR ADMISSION O F ADDITIONAL EVIDENCE ITA NO. 254/JP/2012 SHRI MANOHAR CHATURVEDI VS. ITO, WARD- 3 (1), JAIPU R . 6 GIVING REASONS AND CLAIMING THAT HE WAS PREVENTED B Y SUFFICIENT CAUSE AS HE WAS NOT ABLE TO FILE THE ADDITIONAL EVIDENCE BEF ORE THE AO. IN OUR CONSIDERED VIEW, THE APPELLATE AUTHORITY HAS COTERM INOUS POWER WITH THE AO AND HE SHOULD HAVE ADMITTED THE ADDITIONAL EVIDE NCE TO ENSURE THAT FAIR AND PROPER ASSESSMENT IS MADE. THUS IN THE INT EREST OF JUSTICE, WE ARE INCLINED TO SET ASIDE BACK THE ISSUE OF APPEAL TO T HE FILE OF THE AO TO DECIDE THE SAME AFRESH BY ALLOWING THE ADDITIONAL E VIDENCE OF THE ASSESSEE AND PROVIDING THE ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN ACCORDANCE WITH LAW. 3.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES ORDER PRONOUNCED IN THE OPEN COURT ON 06/11/2015. SD/- SD/- FOE FLAG ;KNO VKJ-IH-RKSYKUH (VIKRAM SINGH YADAV) (R.P.TOLANI) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 06/11/ 2015 *MISHRA VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI MANOHAR CHATURVEDI, JAIPUR 2. IZR;FKHZ@ THE RESPONDENT- THE ITO, WARD- 3 (1) , JAIPUR 3. VK;DJ VK;QDRVIHY ) @ CIT(A) 4. VK;DJ VK;QDR@ CIT 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO.254/JP/2012) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR