M/s. Surapareddy Rambabu, Rajahmundry V. The ITO, Rajahmundry

ITA 258/VIZ/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 8800 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 8 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 03-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained investment; Principle of natural justice; Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH, VISAKHAPATNAM BEFORE SHRI V. DURGA RAO , HONBLE JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH , HONBLE ACCOUNTANT MEMBER ITA NO. 258 / VIZ /201 7 (ASST. YEAR : 20 11 - 12) SURAPUREDDY RAMBABU , D.NO. 7 - 95, CHOPPELLA, ALAMUR U MANDAL, RAJAHMUNDRY , EAST GODAVARI DISTRICT. V S . IT O , WARD - 3 , RAJAHMUNDRY . PAN NO. CUVPS 5221 E (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI G.V.N. HARI ADV OCATE . DEPARTMENT BY : SHRI M.N. MURTHY NAIK SR. DR DATE OF HEARING : 1 7 / 01 /201 8 . DATE OF PRONOUNCEMENT : 25 / 01 /201 8 . O R D E R PER V. DURGA RAO, JUDICIAL MEMBER TH IS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) , RAJAHMUNDRY , DATED 02 /0 1 /201 7 FOR THE ASSESSMENT YEAR 20 11 - 12 . 2. IN THIS APPEAL, THERE IS A DELAY OF 47 DAYS IN FILING THE APPEAL . THE ASSESSEE HAS FILED AN AFFIDAVIT STATING THE REASONS FOR FILING THIS APPEAL BELATEDLY. WE FIND THAT T HE REASONS ASSIGN ED BY THE ASSESSEE ARE SUFFICIENT CAUSE TO CONDONE THE DELAY . ACCORDINGLY, DELAY IS CONDONED AND APPEAL IS ADMITTED FOR HEARING. 2 ITA NO. 258/VIZ/2017 (SURAPUREDDY RAMBABU ) 3 . FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESSEE CARRIED ON BUSINESS IN IMFL , FILED HIS RETURN OF INCOME ADMITTING TOTAL INCOME OF RS. 7,68,720/ - . THE CASE WAS SELECTED FOR SCRUTINY AND ASSESSMENT WAS COMPLETED BY ESTIMATING NET PROFIT FROM WINE BUSINESS AT 20% OF PURCHASE PRICE, WHICH WORKED OUT TO RS.26,21,258/ - AND ALSO MADE AN ADDITION OF RS. 28,66,667/ - TOWARDS UNEXPLAINED INVESTMENT AND RS. 44,254/ - TOWARDS BANK INTEREST INCOME. ACCORDINGLY, THE ASSESSING OFFICER DETERMINED TOTAL INCOME AT RS. 55,32,163/ - . 4 . ON APPEAL, NON E APPEARED BEFORE THE LD. CIT(A). THE LD.CIT(A) HAS SCALED DOWN THE ESTIMATION OF INCOME OF THE ASSESSEE FROM LIQUOR BUSINESS TO 10% OF PURCHASE PRICE. SO FAR AS FIRST INSTALMENT FEE OF RS. 28,66,667/ - PAID BY THE ASSESSEE IS CONCERNED , NO DETAILS WERE FILED AND ALSO NO EXPLANATION WAS OFFERED, HENCE, THE SAME IS CONFIRMED. 5. ON BEING AGGRIEVED, ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE TRIBUNAL. 6 . WHEN THIS APPEAL IS TAKEN UP FOR HEARING, LD. C OUNSEL FOR THE ASSESSEE HAS FILED AN APPLICATION FOR ADMI SS ION OF ADDITIONAL EVIDENCE IN RESPECT OF PAYMENT OF INITIAL LICENCE FEE OF RS. 28,66,667/ - AND SUBMITTED THAT ADDITIONAL EVIDENCE MAY BE ADMITTED AND THE ISSUE MAY BE REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER FOR FRESH ADJUDICATION. SO FAR AS ESTIMATION OF 3 ITA NO. 258/VIZ/2017 (SURAPUREDDY RAMBABU ) INCOME IS CONCERNED, HE SUBMITTED THAT THE ISSUE HAS BEEN COVERED BY THE DECISION OF THE COORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF TANGUDU JOGISETTY IN ITA NO.96/VIZAG/2016 BY ORDER DATED 2.6.2016 , THEREFORE THE SAME MAY BE FOLLOWED . 7 . ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENTATIVE HAS SUBMITTED THAT ASSESSEE HAS NOT COOPERATED TO HIS CASE BEFORE THE ASSESSING OFFICER NOR LD. CIT(A), THEREFORE, THE ORDER PASSED BY THE LD.CIT(A) HAS TO BE CONFIRMED. 8 . WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATERIAL AVAILABLE ON RECORD AND ORDERS OF THE AUTHORITIES BELOW. 9. THE ASSESSEE IS IN IMFL BUSINESS AND INITIALLY INVESTED LICENCE FEE OF RS. 28,66,667/ - . IN THIS REGARD, N O DETAILS WERE FILED BEFORE THE ASSESSING OFFICER , EVEN BEFORE THE LD. CIT(A) NONE APPEARED , THEREFORE, LD. CIT(A) PASSED AN EX - PA R TE ORDER . NOW, THE ASSESSEE HAS FILED ALL THE DETAILS IN RESPECT OF INITIAL INVESTMENT BY WAY OF PAPER BOOK AND SUBMITTED THAT THE SAME MAY BE CONSIDERED AND ONE MORE OPPORTU NITY MAY BE GIVEN TO SUBSTANTIATE HIS CASE BEFORE THE ASSESSING OFFICER. WE FIND THAT THOUGH , ASSESSEE HAS NOT APPEARED BEFORE THE LD. CIT(A) , IN THE INTEREST OF JUSTICE AND ALSO BY FOLLOWING THE PRINCIPLES OF NATURAL JUSTICE, ONE MORE OPPORTUNITY SHOULD BE GIVEN TO THE ASSESSEE TO SUBSTANTIATE HIS CASE . SO FAR AS ESTIMATION OF INCOME IS CONCERNED, WE ARE OF THE OPINION THAT IT HAS TO SEND BACK TO THE ASSESSING OFFICER FOR FRESH 4 ITA NO. 258/VIZ/2017 (SURAPUREDDY RAMBABU ) CONSIDERATION IN VIEW OF THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE. THUS , WE SET ASIDE THE ENTIRE ORDER PASSED BY THE LD.CIT(A) AND REMITTED THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER TO ADJUDICATE AFRESH IN ACCORDANCE WITH LAW BY CONSIDERING THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE AFTER GIVING HIM REASONABLE OPPORTUNITY OF HEARING . 10 . IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN OPEN COURT ON TH IS 2 5 T H DAY OF JAN . , 201 8 . S D / - S D / - ( D.S. SUNDER SINGH ) ( V. DURGA RAO ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 2 5 T H JANUARY , 201 8 . VR/ - COPY TO: 1. THE ASSESSEE - SURAPUREDDY RAMBABU, D.NO.7 - 95, CHOPPELLA, ALAMURU MANDAL, RAJAHMUNDRY, EAST GODAVARI DISTRICT. 2. THE REVENUE - ITO, WARD - 3, RAJAHMUNDRY. 3. THE CIT, RAJAHMUNDRY. 4. THE CIT(A) , RAJAHMUNDRY. 5. THE D.R . , VISAKHAPATNAM. 6. GUARD FILE. BY ORDER (VUKKEM RAMBABU) SR. PRIVATE SECRETARY, ITAT, VISAKHAPATNAM.