G.Sivarama Krishna, Hyd, Hyderabad V. DCIT, Circle-6(1), Hyderabad, Hyderabad

ITA 262/HYD/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 2339 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 4 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-07-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 25-10-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 08-03-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: A V RAGHURAM
• Keywords: Unexplained cash credit
• Section: 6; 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A : HYDERABAD BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA.NO.262/HYD/2016 ASSESSMENT YEAR 2006 - 2007 G. SIVARAMA KRISHNA, C/O. N.B. KUMAR, F.NO.101, SREE RESIDENCY, HANUMAN NAGAR, NEAR HITECH CITY, KONDAPUR, HYDERABAD - 84. PAN: ACAPG4006C VS. THE DCIT, CIRCLE - 6(1), HYDERABAD. (APPELLANT) (RESPONDENT) FOR ASSESSEE: SHRI A.V. RAGHURAM FOR REVENUE : SHRI PRABHAT KUMAR GUPTA, DR DATE OF HEARING : 12.07.2017 DATE OF PRONOUNCEMENT : 12.07.2017 ORDER PER D. MANMOHAN , VP. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE CIT (A) - 8, HYDERABAD AND IT PERTAINS TO THE ASSESSMENT YEAR 2006 - 2007. PENALTY LEVIED BY THE ASSESSING OFFICER U/S 271(1)(C) OF THE ACT HAVING BEEN CONFIRMED BY THE CIT (A), THE ASSES SEE QUESTIONS THE ORDER PASSED BY THE TAX AUTHORITIES ON THE GROUND THAT BOTH THE ORDERS WERE PASSED WITHOUT APPLICATION OF MIND TO THE FACTS OF THE CASE AND BY IGNORING THE EVIDENCE / SUBMISSIONS ON RECORD DURING THE PENALTY PROCEEDINGS. 2. FACTS NECESSAR Y FOR THE DISPOSAL OF THE APPEAL ARE STATED IN BRIEF. ASSESSEE DERIVES INCOME FROM PROPERTY, SALARY AND OTHER SOURCES. FOR THE YEAR UNDER CONSIDERATION, IT DECLARED TOTAL INCOME OF RS. 10,98,490/ - . THE MATTER HAS BEEN SELECTED FOR THE SCRUTINY. THE A.O. ISSUED A NOTICE U/S 143(2) OF THE ACT AND EXAMINED THE RECORD. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS REQUIRED TO FURNISH CONFIRMATIONS FROM 8 PARTIES REFERRABLE TO CREDITS NOTICED IN THEIR NAMES. 2 ASSESSEE COULD NOT OBTAIN THE CONF IRMATIONS FROM THE PARTIES FROM WHOM THE ASSESSEE HAS CLAIMED LOANS. THEREFORE, THE CASH CREDITS APPEARED IN THE NAMES OF THE ABOVE PERSONS ARE TREATED AS UNEXPLAINED CREDITS AND COMPLETED THE ASSESSMENT ON 31.12.2008 ACCORDINGLY. THE ORDER OF THE ASSESSING OFFICER WAS CHALLENGED BEFORE THE LD. CIT(A) AS WELL AS BEFORE THE ITAT, WHICH ENDED UP WITHOUT ANY FRUITFUL OUTCOME. 3. AS THE THINGS STOOD THUS, THE A.O. INITIATED THE PENALTY PROCEEDINGS. DURING THE COURSE OF PENALTY PROCEEDINGS, THE ASSESSEE FILED A LETTER DATED 2.12.2011, WHICH IS IN FACT A LETTER TO BE ADDRESSED TO THE CIT (A), BUT ADDRESSED TO THE DCIT, CIRCLE - 4(1), HYDERABAD. IN THE SAID LETTER, THE DETAILS OF UNSECURED LOAN, I.E., NAME OF THE PARTY, CONFIRMATION LETTERS FROM THE SAID P ERSONS ETC., WERE FURNISHED EXCEPT WITH REGARD TO TWO PERSONS, WHO WERE OUT OF INDIA. EVEN WITH REGARD TO THE SAID TWO CREDITORS , IT WAS STATED THAT COPIES OF THE ORIGINAL CONFIRMATION LETTERS WERE VERIFIED IN THE ASSESSMENT PROCEEDINGS AND IT CAN BE CROSS VERIFIED WITH THE BANK ACCOUNT OF THE ASSESSEE. 4. THE ASSESSING OFFICER OBSERVED THAT THE ADDITION MADE IN THE QUANTUM PROCEEDINGS, HAVING BEEN CONFIRMED BY THE ITAT, IT WAS A FIT CASE FOR LEVY OF PENALTY AND ACCORDINGLY, COMPLETED THE PENALTY PROCEEDING S. 5. THOUGH IT WAS SUBMITTED BEFORE THE LD. CIT(A) THAT THE LETTER DATED 2.12.2011 AND ITS ANNEXURES WERE AVAILABLE BEFORE THE ASSESSING OFFICER, THE SAME WERE NOT TAKEN INTO CONSIDERATION; IT WAS FURTHER SUBMITTED THAT THE TRIBUNAL , IN THE QUANTUM PROCEE DINGS , ERRED IN HOLDING THAT THE DATE OF LETTER IS NOT AUTHENTIC, OVERLOOKING THE FACT THAT THE LETTER FILED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER WAS NOT DOUBTED BY THE REVENUE. 6. INSTEAD OF GOING INTO THE FACTUAL MATRIX OF THE CASE, LD. CIT (A) M ERELY PROCEEDED TO CONFIRM THE PENALTY ON THE GROUND THAT THE ADDITION MADE IN THE QUANTUM PROCEEDINGS WAS CONFIRMED BY THE ITAT. IT DESERVES TO BE NOTICED THAT THE APPELLATE TRIBUNAL, IN THE QUANTUM PROCEEDINGS, OBSERVED THAT THE LETTER DATED 02.12.2011 FILED BEFORE THE CIT (A) DOES NOT BEAR ANY SIGNATURE OR INWARD NUMBER AND THEREFORE, AUTHENTICITY OF THE SAME IS DOUBTFUL. 3 7. UNDER THESE CIRCUMSTANCES, THE ASSESSEE FILED THE SECOND APPEAL CONTENDING INTER ALIA THAT B OTH THE A.O. AND THE LD. CIT(A) ERRED IN LEVYING THE PENALTY U/S 271(1)(C) OF THE ACT , OVERLOOKING THE CLAIM THAT THE LETTER WAS INDEED FILED ALONG WITH THE CONFIRMATION LETTERS BUT, THE SAME WAS WRONGLY NOT TAKEN INTO CONSIDERATION. LD COUNSEL FOR THE ASSESSEE PLACED BEFORE US COPY OF THE L ETTER FILED BEFORE THE ASSESSING OFFICER, WHEREIN THE SEAL CONTAINING THE DATE OF RECEIPT WAS NOT VISIBLE. IT WAS SUBMITTED THAT A REMAND REPORT FROM THE ASSESSING OFFICER WOULD CLARIFY THE ISSUE. ACCORDINGLY, THE BENCH DIRECTED THE LD DR TO OBTAIN A REM AND REPORT. LD DR IN TURN ADMITTED THAT THE ASSESSEE FILED A LETTER DATED 02.12.2011, BUT THE SAME WAS NOT TAKEN INTO CONSIDERATION. 8. HAVING REGARD TO THE CIRCUMSTANCES OF THE CASE, IN THE INTEREST S OF JUSTICE, WE ARE OF THE VIEW THAT THE MATTER DESER VES TO BE SET ASIDE TO THE FILE OF THE A.O. FOR FRESH CONSIDERATION WHEREIN, HE IS DIRECTED TO VERIFY THE EVIDENCE PLACED BEFORE HIM ALONG WITH THE LETTER DATED 02.12.2011 AND IF NECESSARY TO MAKE FURTHER INVESTIGATION INTO THE MATTER. WHEN THIS WAS PUT T O BOTH THE PARTIES, IT WA S AGREED UPON THAT THE MATTER REQUIRES RELOOK. 9. UNDER THESE CIRCUMSTANCES, WE SET ASIDE THE ORDER PASSED BY THE A.O. AS WELL AS THE LD. CIT(A) AND DIRECT THE ASSESSING OFFICER TO RECONSIDER THE MATTER OF LEVY OF PENALTY IN ACCORDANCE WITH LAW. 10. IN THE RESULT, APPEAL FILED BY THE ASSESSEE TREATED AS ALLOWED FOR STATISTICAL PURP OS ES. ORDER PRONOUNCED IN THE OPEN COURT ON 12 TH JULY, 2017. SD/ - SD/ - (S. RIFAUR RAHMAN) (D. MANMOHAN ) ACCOUNTANT MEMBER VICE PRESIDENT HYDERABAD, DATED: 12 TH JULY , 2017 OKK, SR.PS 4 COPY TO 1. K . V A S A N T K U M A R , A . V . R A G H U R A M , P . V I N O D & N E E L I M A D E V I , A D V O C A T E S , 6 1 0 , B A B U K H A N E S T A T E , B A S H E E R B A G H , H Y D E R A B A D - 0 1 . 2. THE DCIT, CIRCLE - 6(1), HYDERABAD. 3. CIT(A) - 8 , HYDERABAD. 4. PR. CIT - 6 , HYDERABAD. 5. D.R. ITAT A BENCH, HYDERABAD. 6. GUARD FILE