MRS. SHALINI SARANGAPANI, CHENNAI V. ITO, CORPORATE WARD-4(1), CHENNAI

ITA 2775/CHNY/2019

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 1275 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-12-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2010-2011
• Appeal Filed On: 27-09-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J PAVITHRA KUMAR
• Assessee Lawyers: S SRIDHAR
• Keywords: Unexplained cash credit; Opportunity of being heard; Principle of natural justice
• Section: 143(3); 147; 68

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: CHENNAI ... , ! , & BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ITA NO.2775/CHNY/2019 ' ' /ASSESSMENT YEAR: 2010-11 MRS. SHALINI SARANGAPANI NEW NO. 24, OLD NO. 19 LAKE AREA, 1 ST STREET, NUNGAMBAKKAM, CHENNAI-600034 V . THE INCOME TAX OFFICER, NON-CORPORATE WARD-4(1), CHENNAI-600 034. [PAN: AAMPS8432N ] ( * /APPELLANT) ( +,* /RESPONDENT) * - / APPELLANT BY : MR. S.SRIDHAR +,* - /RESPONDENT BY : MR. J.PAVITHRA KUMAR, JCIT - /DATE OF HEARING : 17.12.2019 - /DATE OF PRONOUNCEMENT : 17.12.2019 / O R D E R PER RAMIT KOCHAR, ACCOUNTANT MEMBER : THIS APPEAL FILED BY ASSESSEE IS DIRECTED AGAINST A PPELLATE ORDER DATED 25.07.2019 PASSED BY LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-7, CHENNAI (HEREINAFTER CALLED THE CIT(A)), IN ITA N O.66/CIT(A)-7/2018-19 FOR ASSESSMENT YEAR (AY) 2010-11, THE APPELLATE PROCEED INGS BEFORE LEARNED CIT(A) HAD ARISEN FROM ASSESSMENT ORDER DATED 26.12.2018 PASSED BY LEARNED ITA NO.2775/CHNY/2019 :- 2 -: ASSESSING OFFICER (HEREINAFTER CALLED THE AO) U/ S.143(3) READ WITH SECTION 147 OF THE INCOME-TAX ACT, 1961 (HEREINAFTER CALLED TH E ACT) FOR AY: 2010-11. 2. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT TH E ASSESSEE DID NOT FILE ITS RETURN OF INCOME WITH REVENUE FOR IMPUGNED AY: 2010-11 AND AS PER DETAILS AVAILABLE WITH REVENUE, THE ASSESSEE HAD INCOME OF MORE THAN RS. 1 LAC FOR IMPUGNED AY: 2010-11 , AND ALSO THE ASSESSEE WAS DIRECTOR IN M/S MERIT RESORTS PRIVATE LIMITED. THIS LED TO REOPENING OF THE CONCLUDED ASS ESSMENT BY REVENUE BY INVOKING PROVISIONS OF SECTION 147/148 OF THE 1961 ACT. SEVERAL STATUTORY NOTICES WERE ISSUED BY AO TO ASSESSEE TO FILE HER R ETURN OF INCOME WITH REVENUE AS IS FOUND MENTIONED IN PARA 2-5 OF ASSESSMENT ORD ER AND FINALLY ON 21.08.2018, THE ASSESSEE FILED ITS RETURN OF INCOME FOR IMPUGNED AY : 2010-11 DECLARING INCOME OF RS. 3,02,364/-. FINALLY, ADDITI ONS WERE MADE BY THE AO TO THE RETURNED INCOME OF THE ASSESSEE, WITH RESPECT T O UNEXPLAINED CASH DEPOSITED IN BANK ACCOUNTS TO THE TUNE OF RS. 27,23,000/- A ND ALSO ADDITIONS WERE MADE IN THE HANDS OF ASSESSEE FOR UNEXPLAINED CASH CREDI TS U/S 68 OF THE 1961 ACT TO THE TUNE OF RS. 1,25,65,000/- IN THE HANDS OF THE A SSESSEE AND FINALLY INCOME WAS ASSESSED TO THE TUNE OF RS. 1,55,90,364/- BY TH E AO IN THE HANDS OF THE ASSESSEE, VIDE ASSESSMENT ORDER DATED 26.12.2018 PA SSED BY THE AO U/S. 143(3) READ WITH SECTION 147 OF THE 1961 ACT. AGGRIEVED BY AN ASSESSMENT FRAMED BY AO VIDE ASSESSMENT ORDER DATED 26.12.2018 PASSED BY AO U/S 143(3) READ WITH SECTION 147 OF THE 1961 ACT, THE ASSESSEE FILED FIR ST APPEAL BEFORE LD.CIT(A) WHICH WAS DISMISSED BY LD.CIT(A) VIDE APPELLATE ORD ERS DATED 25.07.2019 , INTER-ALIA, FOR NON-APPEARANCE ON 25.07.2019 , BUT HOWEVER, WHILE PASSING APPELLATE ORDER THE LD.CIT(A) SIMPLY UPHELD ASSESSM ENT ORDER PASSED BY THE AO WITHOUT INDEPENDENTLY DISCUSSING ISSUES ON MERITS R AISED BY ASSESSEE IN ITS FIRST ITA NO.2775/CHNY/2019 :- 3 -: APPEAL FILED WITH LEARNED CIT(A) , AS IS REQUIRED UNDER PROVISIONS OF SEC.250(6) OF THE 1961 ACT. IT IS MATTER OF RECORD AS IS EMERG ING FROM APPELLATE ORDER PASSED BY LEARNED CIT(A) THAT IN ALL FOUR HEARINGS WERE F IXED BY LEARNED CIT(A) VIZ. ON 14.05.2019, 30.05.2019, 11.06.2019 AND 25.07.2019. IT IS FURTHER MATTER OF RECORD THAT THE ASSESSEE SOUGHT ADJOURNMENT ON FIRS T THREE OCCASIONS VIZ. ON 14.05.2019, 30.05.2019, AND 11.06.2019 WHICH WAS G RANTED BY LEARNED CIT(A) ON ALL THESE THREE OCCASIONS AND IT IS ONLY ON 25.0 7.2019 , THERE WAS NO APPEARANCE BY THE ASSESSEE BEFORE LEARNED CIT(A) NO R AN APPLICATION FOR ADJOURNMENT WAS MOVED BY ASSESSEE WHICH LED LEARNED CIT(A) TO DISMISS APPEAL OF THE ASSESSEE. 3. AGGRIEVED BY AN APPELLATE ORDER DATED 25.07.2019 PASSED BY LEARNED CIT(A) DISMISSING APPEAL OF THE ASSESSEE , THE ASSESSEE HA S FILED THIS APPEAL BEFORE TRIBUNAL AND ARGUMENTS ARE ADVANCED BY BOTH THE RIV AL PARTIES BEFORE THE BENCH. THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT LD.C IT(A) OUGHT TO HAVE ADJUDICATED THE ISSUES IN APPEAL FILED BY ASSESSEE ON MERITS BY INDEPENDENT APPLICATION OF MIND , AS IS REQUIRED UNDER PROVISI ONS OF SECTION 250(6) OF THE 1961 ACT BUT HOWEVER LEARNED CIT(A) SIMPLY UPHELD A SSESSMENT ORDER PASSED BY LEARNED AO. IT WAS SUBMITTED THAT THE ASSESSEE MOVE D AN ADJOURNMENT ON THE FIRST THREE DATES OF HEARING ON 14.05.2019, 30.05.2 019 AND 11.06.2019 RESPECTIVELY WHICH ADJOURNMENTS SOUGHT WERE GRANTED BY LEARNED CIT(A) BUT, HOWEVER, IT IS ONLY ON 25.07.2019 WHEN THE APPEAL W AS CALLED FOR HEARING, THE ASSESSEE DID NOT MOVE AN ADJOURNMENT NOR APPEARED B EFORE LEARNED CIT(A). IT WAS PRAYED THAT MATTER MAY BE RESTORED TO THE FILE OF LD.CIT(A) FOR FRESH ADJUDICATION AND AN FRESH OPPORTUNITY MAY BE GRANTE D TO THE ASSESSEE TO APPEAR BEFORE LD.CIT(A) AND PRESENT ITS CASE/ARGUMENTS/EVI DENCES IN ITS DEFENSE IN ITA NO.2775/CHNY/2019 :- 4 -: DENOVO APPELLATE PROCEEDINGS. IT WAS STATED BY LEA RNED COUNSEL FOR THE ASSESSEE BEFORE THE BENCH THAT IF GIVEN AN OPPORTUNITY, THE ASSESSEE WILL FULLY CO-OPERATE WITH LEARNED CIT(A) IN DENOVO APPELLATE PROCEEDINGS . THE LD.DR SUBMITTED THAT ASSESSEE DID NOT APPEAR BEFORE LEARNED CIT(A) IN FI RST ROUND OF LITIGATION ON 25.07.2019 AND IT IS THE ASSESSEE WHO IS RESPONSIBL E FOR ITS WOES BUT HOWEVER, LEARNED DR FAIRLY SUBMITTED THAT THE ISSUES MAY BE RESTORED TO THE FILE OF LD.CIT(A) FOR FRESH ADJUDICATION. 4. WE HAVE CONSIDERED RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD. WE HAVE OBSERVED THAT THE ASSESSEE DID NOT FILE ITS R ETURN OF INCOME WITH REVENUE FOR IMPUGNED AY: 2010-11 AND AS PER DETAILS AVAILAB LE WITH REVENUE, THE ASSESSEE HAS INCOME OF MORE THAN RS. 1 LAC AND ALSO THE ASSESSEE WAS DIRECTOR IN M/S MERIT RESORTS PRIVATE LIMITED. THIS LED TO R EOPENING OF THE CONCLUDED ASSESSMENT BY AO BY INVOKING PROVISIONS OF SECTION 147/148 OF THE 1961 ACT AS IN THE VIEW OF AO INCOME OF THE ASSESSEE HAS ESCAPE D ASSESSMENT WHICH REQUIRES INTERVENTION BY AO BY INVOCATION OF ITS POWERS U/S 147/148 OF THE 1961 ACT. AS IS EMERGING FROM ASSESSMENT ORDER, SEVERAL STATUTORY NOTICES WERE ISSUED BY THE AO TO ASSESSEE TO FILE RETURN OF INCOME AS MENTIONE D IN PARA 2-5 OF ASSESSMENT ORDER AND FINALLY ON 21.08.2018, THE ASSESSEE FILED ITS RETURN OF INCOME FOR IMPUGNED AY DECLARING INCOME OF RS. 3,02,364/-. FIN ALLY, ADDITIONS WERE MADE BY AO WITH RESPECT TO UNEXPLAINED CASH DEPOSITED BY AS SESSEE IN HER BANK ACCOUNTS TO THE TUNE OF RS. 27,23,000/- AND ALSO AO MADE AD DITIONS TOWARDS UNEXPLAINED CASH CREDITS U/S 68 OF THE 1961 ACT TO THE TUNE OF RS. 1,25,65,000/- AND FINALLY INCOME WAS ASSESSED BY AO TO THE TUNE OF RS. 1,55, 90,364/- IN THE HANDS OF THE ASSESSEE, VIDE ASSESSMENT ORDER DATED 26.12.2018 PA SSED BY THE AO U/S. 143(3) READ WITH SECTION 147 OF THE 1961 ACT. THE ASSESSE E FILED FIRST APPEAL WITH ITA NO.2775/CHNY/2019 :- 5 -: LEARNED CIT AGITATING AND CHALLENGING ADDITIONS MAD E BY THE AO. THE LEARNED CIT(A) FIXED THE APPEAL FOR HEARING ON FOUR OCCASIO NS, ON FIRST THREE OCCASIONS I.E. 14.05.2019, 30.05.2019 AND 11.06.2019, THE ASSESSEE DID SOUGHT ADJOURNMENT WHICH WAS GRANTED BY LEARNED CIT(A) BUT WHEN THE AP PEAL WAS CALLED FOR HEARING ON 25.07.2019,THE ASSESSEE DID NOT APPEAR BEFORE LE ARNED CIT(A) NOR MOVED AN ADJOURNMENT APPLICATION BEFORE LEARNED CIT(A) WHICH LED TO DISMISSAL OF APPEAL EX-PARTE BY LEARNED CIT(A) , VIDE APPELLATE ORDER D ATED 25.07.2019. WE HAVE OBSERVED FROM APPELLATE ORDER DATED 25.07.2019 PASS ED BY LD.CIT(A) THAT LEARNED CIT(A) PASSED AN APPELLATE ORDER WITHOUT DI SCUSSING ISSUES IN THE APPEAL FILED BY ASSESSEE INDEPENDENTLY ON MERITS AND HAS , INTER-ALIA, DISMISSED APPEAL OF THE ASSESSEE FOR NON-APPEARANCE AND SIMPLY UPHE LD ASSESSMENT ORDER PASSED BY THE AO WITHOUT INDEPENDENTLY DISCUSSING A LL THE ISSUES IN APPEAL FILED BY ASSESSEE ON MERITS BASED ON MATERIAL ON RECORD , AS IS REQUIRED U/S 250(6) OF THE 1961 ACT. IN OUR CONSIDERED VIEW, THE MATTER N EEDS TO BE RESTORED TO FILE OF LD.CIT(A) FOR FRESH ADJUDICATION ON MERITS IN ACCOR DANCE WITH THE LAW OF ALL THE ISSUES/GROUNDS RAISED BY ASSESSEE IN ITS FIRST APPE AL FILED WITH LEARNED CIT(A). WE HEREBY DIRECT ASSESSEE TO APPEAR BEFORE LD.CIT(A ) AND SUBMIT ALL NECESSARY EVIDENCES, EXPLANATIONS ETC., IN SUPPORT OF ITS CON TENTION , WHEN THE APPEAL COMES FOR HEARING BEFORE LD.CIT(A) IN DENOVO APPELL ATE PROCEEDINGS IN SECOND ROUND OF LITIGATION. IT IS MADE CLEAR THAT IN CASE IF THE ASSESSEE STILL DID NOT COME FORWARD AND CO-OPERATE IN DENOVO APPELLATE PROCEED INGS BEFORE LEARNED CIT(A), THEN LD.CIT(A) SHALL BE AT LIBERTY TO DECIDE THE IS SUES ON MERITS IN ACCORDANCE WITH LAW. THE LD.CIT(A) IS DIRECTED TO DENOVO ADJU DICATE ALL THE ISSUES RAISED BY ASSESSEE IN ITS FIRST APPEAL FILED WITH LEARNED CIT (A) ON MERITS IN ACCORDANCE WITH LAW. NEEDLESS TO SAY THAT LEARNED CIT(A) SHALL PROV IDE PROPER AND ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN ACCOR DANCE WITH PRINCIPLES OF ITA NO.2775/CHNY/2019 :- 6 -: NATURAL JUSTICE IN ACCORDANCE WITH LAW, IN DENOVO A PPELLATE PROCEEDINGS. THUS, THE APPEAL OF THE ASSESSEE STANDS ALLOWED FOR STAT ISTICAL PURPOSES. WE ORDER ACCORDINGLY. 5 IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE I N ITA NO.2775/CHNY/2019 FOR AY: 2010-11 IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON THIS 17 TH DAY OF DECEMBER , 2019 IN CHENNAI. SD/- SD/- ( . . . ) ( N.R.S. GANESAN ) /JUDICIAL MEMBER ( ! ) (RAMIT KOCHAR) /ACCOUNTANT MEMBER /CHENNAI, 1 /DATED: 17 TH DECEMBER , 2019. TLN - +!2 32 /COPY TO: 1. * /APPELLANT 4. 4 /CIT 2. +,* /RESPONDENT 5. 2 + /DR 3. 4 ( ) /CIT(A) 6. ' /GF