UMA SONI, Jaipur V. ITO, Jaipur

ITA 260/JPR/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 5466 (ITAT-JAIPUR)
• Duration Of Justice: 2 year(s) 11 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 11-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KAILASH MANGAL JCIT DHK
• Keywords: Unexplained investment; Opportunity of being heard; Principle of natural justice; Deemed to accrue or arise in india; Corroborative evidences
• Section: 69C; 143(3); 69

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 VH-VKJ-EHUK] YS[KK LNL; ,OA JH YFYR DQEKJ] U;KF; D LNL; DS LE{K BEFORE: SHRI T.R.MEENA, AM & SHRI LALIET KUMAR, JM VK;DJ VIHY LA -@ ITA NO. 260/JP/2013 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2009-10 UMA SONI, SHOP NO. 2, HOLI HOUSE, HEERA NAGAR, AJMER ROAD, JAIPUR. CUKE VS. I.T.O., WARD 2(3), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO. ANYPS 1296 D VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : WRITTEN SUBMISSION JKTLO DH VKSJ LS@ REVENUE BY : SHRI KAILASH MANGAL (JCIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 04/01/2016 MN?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 12/02/2016 VKNS'K@ ORDER PER T.R. MEENA, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER DATED 12/12/2012 OF THE LEARNED CIT(A)-I, JAIPUR FOR A.Y. 2009-10. THE EFFECTIVE GROUNDS OF APPEAL ARE AS UNDER:- 1. IMPUGNED ASSESSMENT ORDER PASSED U/S 143(3) IS BAD IN LAW AND ON FACTS BEING AGAINST THE PRINCIPAL OF NATURAL JUSTICE AND FOR MANY MORE OTHER REASONS. 2 ITA NO. 260/JP/2013 UMA SONI VS ITO 2. UNDER THE FACTS AND CIRCUMSTANCES, LD. CIT (A) H AS ERRED BY HOLDING THAT 'IN ABSENCE OF ANY SUPPORTING EVIDENCE THE DECISION OF THE AO TO ADD THE EXPENDITURE OF RS. 24,40,101.00 THROUGH THE CREDIT CARD U/S 69C TO THE INCOME OF THE APPELLANT IS CONFIRMED' THE FINDING IS FACTUALLY WRONG, HENCE ADDITION CONFIRMED BASED ON WRONG ASSUMPTION OF FACTS DESERVES TO BE DELETED. 3. UNDER THE FACTS AND CIRCUMSTANCES, LD. A.O., HAS ERRED BY TREATING PAYMENT THROUGH CREDIT CARDS FOR PURCHASES AS UNEXPLAINED AND CONSEQUENTLY MAKING ADDITION AS DEEMED INCOME U/S 69 OF RS. 24,40,101.00 AND THE LD. CIT (A) HAS ERRED BY CONFIRMING THE SAME. THE ADDITION MADE IS UNJUSTIFIE D, ILLEGAL OR EXCESSIVE. 4. UNDER THE FACTS AND CIRCUMSTANCES, LD. A.O. HAS ERRED IN MAKING AN ADDITION OF RS. 4,44,600/-, ON ACCOUNT UNEXPLAINED INVESTMENT , U/S 69 OF THE INCOME TAX ACT, AND LD. CIT(A) ERRED BY SUSTAINING THE SAME. THE ADDITION MADE IS UNJUSTIFIED, ILLEGAL OR EXCESSIVE. 5. UNDER THE FACTS AND CIRCUMSTANCES, LD. A.O. HAS ERRED BY HOLDING PROFIT ON DEALING OF SHARES AS SPECULATIVE AND CONSEQUENTLY MAKING ADDITION OF RS.39,976.00 AND LD. CIT(A) ERRED BY SUSTAINING THE SAME. THE ADDITION MADE IS UNJUSTIFIED, ILLEGAL OR EXCESSIVE. 6. UNDER THE FACTS AND CIRCUMSTANCES, THE LD. A.O.A S WELL AS CIT (A) HAS ERRED BY NOT PROVIDING TELESCOPING. 2. THE ASSESSEES APPEAL IS AGAINST NOT DECIDING THE ASSESSEES CASE ON PRINCIPLE OF NATURAL JUSTICE, ADDING THE EXPENDI TURE OF RS. 24,40,101/- 3 ITA NO. 260/JP/2013 UMA SONI VS ITO U/S 69C OF THE INCOME TAX ACT, 1961 (IN SHORT THE AC T), RS. 4,44,600/- U/S 69 OF THE ACT AND HOLDING SHARE BUSINESS AS SPE CULATIVE BUSINESS BY MAKING ADDITION OF RS. 39,976/-. THE LD ASSESSING OF FICER OBSERVED THAT THE ASSESSEE HAD SHOWN INCOME FROM BUSINESS OR PROFE SSION. SHE FILED RETURN OF INCOME OF RS. 1,82,850/- ON 22/03/2010. TH E CASE WAS SCRUTINIZED U/S 143(3) OF THE ACT. THE LD ASSESSING OFFICER OBSERVED THAT NO BOOKS OF ACCOUNT HAD BEEN MAINTAINED BY THE ASSE SSEE. THE ASSESSEE HAD NOT PRODUCED THE STATEMENT OF CREDIT CARD OPERA TED BY HER TO VERIFY THE CASH FLOW STATEMENT, CREDIT CARD PURCHASE AND CR EDIT CARD SALE. THE TOTAL PAYMENT AS PER CREDIT CARD WERE RS. 24,40,110/ -, THEREFORE, THE ASSESSING OFFICER MADE ADDITION OF SAME AMOUNT IN T HE INCOME OF THE ASSESSEE U/S 69 OF THE ACT. THE ASSESSING OFFICER FU RTHER FOUND THAT AS PER AIR INFORMATION, THE ASSESSEE MADE INVESTMENT I N THE SHARE TO THE TUNE OF RS. 3,36,78,583/-. THE ASSESSING OFFICER GAV E REASONABLE OPPORTUNITY OF BEING HEARD ON THIS ISSUE TO EXPLAIN THE SOURCE OF INVESTMENT. THE ASSESSEE ADMITTED VIDE LETTER DATED 08/12/2011 THAT THESE TRANSACTIONS HAD NOT DISCLOSED BY THE ASSESSE E IN THE RETURN FILED. IT WAS SUBMITTED BY THE ASSESSEE BEFORE THE ASSESSING O FFICER THAT THE ASSESSEE PURCHASED THE SHARES AND HELD THAT FOR FEW DAYS AND THEREAFTER SOLD OUT. THE PROFIT HAS BEEN CALCULATED BY HER AT RS. 32,774/- ONLY. THE 4 ITA NO. 260/JP/2013 UMA SONI VS ITO ASSESSEE ALSO INCURRED SHORT TERM CAPITAL LOSS OF R S. 4,72,844/- AFTER ADJUSTING THE LOSS AGAINST THE PROFIT, THE NET INCO ME CALCULATED BY THE ASSESSEE AT RS. 39,976/-. THE LD ASSESSING OFFICER H ELD THAT THE ASSESSEE HAD PAID MARGIN MONEY TO M/S J.M. FINANCIAL SERVICE S PVT. LTD. FOR WHICH NO EVIDENCE HAS BEEN PRODUCED TO EXPLAIN THE SOURCE OF INVESTMENT. ACCORDINGLY, HE MADE ADDITION OF RS. 3,09,600/-, RS . 90,000/- AND RS. 45,000/- U/S 69 OF THE ACT IN TOTAL RS. 4,44,600/-. 3. BEING AGGRIEVED BY THE ORDER OF THE LD ASSESSING OFFICER, THE ASSESSEE CARRIED THE MATTER BEFORE THE LD CIT(A), WHO HAD DISMISSED THE ASSESSEES APPEAL IN ABSENCE OF NON-APPEARANCE OF THE ASSESSEE BY OBSERVING THAT IN ABSENCE OF ANY SUPPORTING EVIDENC E, THE DECISION OF ASSESSING OFFICER TO ADD THE EXPENDITURE OF RS. 24, 40,101/-, RS. 4,44,600/- AND RS. 39,976/- WERE CONFIRMED. 4. NOW THE ASSESSEE IS IN APPEAL BEFORE US. THE LD AR OF THE ASSESSEE ALSO NOT APPEARED BEFORE US BUT FILED WRITTEN SUBMIS SIONS AS PER GROUND. IT IS SUBMITTED THAT THE ORDER PASSED U/S 143(3) IS ILLEGAL AND UNJUSTIFIED. THE APPELLANT PURCHASED TEXTILE GOODS FROM VARIOUS P ARTIES BY USING CREDIT CARD AND PAYMENTS HAD BEEN MADE TO CREDIT WAS THROUG H BANK ACCOUNTS. THE TOTAL PAYMENT WAS RS. 24,68,555/- WHEREAS THE AS SESSEE HAS SHOWN 5 ITA NO. 260/JP/2013 UMA SONI VS ITO TURNOVER AT RS. 28,47,726/- AS PER COMPUTATION OF T OTAL INCOME. SIMULTANEOUSLY, THE ASSESSEE HAD PURCHASED GOODS TH ROUGH CREDIT CARD AS WELL AS CURRENT ACCOUNT OF ICICI BANK AT RS. 25,87,0 07/-, THUS IT IS CLEARLY EVIDENT THAT THE TURNOVER AS WELL AS PURCHASE ARE MU CH MORE THAN THE PAYMENT OF THE CREDIT CARD AT RS. 24,68,855/-. THE LD CIT(A) ALSO WRONGLY CONFIRMED THE ADDITION. THE APPELLANT FIELD HER RETU RN OF INCOME ON THE BASIS OF TOTAL SALE OF RS. 28,47,476/- BEING NET IN COME @ 9.93% AT RS. 2,82,853/- U/S 44AF OF THE ACT. AS PER SECTION 44AF , THE BOOKS OF ACCOUNT ARE NOT REQUIRED TO BE MAINTAINED. DURING THE COURS E OF ASSESSMENT PROCEEDINGS, IT WAS STATED THAT APPELLANT WAS EARNING INCOME FROM TRADING BUSINESS OF ALL TYPES OF TEXTILE GOODS. THE APPELLAN T HAD PURCHASED GOODS FROM VARIOUS PARTIES BY USING CREDIT CARD. THE EMI O F THE PERSONAL LOAN HAD ALSO BEEN PAID THROUGH CREDIT CARDS. THE LD AR A LSO EXPLAINED THE BREAKUP OF GOODS PURCHASED. AS REGARDS THE INITIAL AMOUNT DEPOSITED, IT WAS SUBMITTED BY HER THAT THE BROKER M/S J.M. FINANC IAL SERVICES PVT. LTD. PAID MARGIN MONEY ON DIFFERENT DATES, WHICH WAS PAID THROUGH CHEQUE FROM ICICI BANK ACCOUNT. THE DETAILS OF TRANSACTION S MADE THROUGH THIS BANK ACCOUNT ALSO GIVEN BY THE ASSESSEE IN THE WRITT EN SUBMISSIONS. THEREFORE, THE ADDITION OF RS. 90,000/- IS TOTALLY U NJUSTIFIED. THE BALANCE AMOUNT OF RS. 2,19,600/- IS ALSO SHORT TERM BUSINES S LOSS. THE ASSESSEE 6 ITA NO. 260/JP/2013 UMA SONI VS ITO HAD NOT CLAIMED THIS LOSS ON ACCOUNT OF NOT HAVING DETAILS, THEREFORE, THE ADDITION MADE BY THE ASSESSING OFFICER AT RS. 3,09, 600/- ALSO DESERVED TO BE DELETED. AT THE TIME OF ASSESSMENT, THE LD ASSES SING OFFICER ONLY CONSIDERED INCOME FROM SHARE AT RS. 39,976/- AND IG NORED THE SHARE LOSS OF RS. 4,72,884/-. THEREFORE, THE ADDITIONS CONFIRME D BY THE LD CIT(A) ARE DESERVED TO BE DELETED. 5. AT THE OUTSET, THE LD DR HAS VEHEMENTLY SUPPORTE D THE ORDER OF THE LD CIT(A) AND ARGUED THAT THE ASSESSEE WAS NON-COOPER ATIVE AT EVERY LEVEL AND NO EVIDENCE HAD BEEN SUBMITTED BEFORE THE LOWER AUTHORITIES. THEREFORE, ORDER OF THE LD CIT(A) IS DESERVED TO BE U PHELD. 6. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. THE A SSESSEES TURNOVER WAS LESS THAN RS. 40 LACS AND HAD FILED THE RETURN U /S 44AF OF THE ACT. THE EVIDENCE FILED BEFORE US SHOWS THAT THE ASSESSEE HAS EVIDENCE TO EXPLAIN THE SOURCE OF BANK ENTRIES AS WELL AS PURCHA SE AND SALE MADE FOR THE BUSINESS PURPOSES. FURTHER ALL THE BANK ACCOUNT S HAD BEEN DISCLOSED BY THE ASSESSEE IN HER RETURN BUT REQUIRED EVIDENCE S WERE NOT FILED AT THE TIME OF ASSESSMENT AS WELL BEFORE THE LD CIT(A). THER EFORE, IN THE INTEREST OF JUSTICE, WE SET ASIDE THE ORDER OF THE LD CIT(A) T O THE ASSESSING OFFICER. 7 ITA NO. 260/JP/2013 UMA SONI VS ITO THE ASSESSEE IS ALSO DIRECTED TO COOPERATE WITH THE A SSESSING OFFICER AND MAKE COMPLIANCE OF ALL NOTICES ISSUED BY HIM. ACCOR DINGLY, THE CASE IS SET ASIDE FOR DE NOVO. THE ASSESSING OFFICER IS ALSO DIR ECTED TO ALLOW REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESS EE. 7. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED F OR STATISTICAL PURPOSES ONLY. ORDER PRONOUNCED IN THE OPEN COURT ON 12/02/2016. SD/- SD/- YFYR DQEKJ VH-VKJ-EHUK (LALIET KUMAR) (T.R. MEENA) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 12 TH FEBRUARY, 2016 RANJAN* VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- UMA SONI, JAIPUR. 2. IZR;FKHZ @ THE RESPONDENT- THE I.T.O., WARD 2(3), JAIPUR. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 260/JP/2013) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR