Shri Manpreet Singh, Bhubaneswar V. ITO, Ward-5(2), Bhubaneswar

ITA 295/CTK/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 4074 (ITAT-CUTTACK)
• Duration Of Justice: 7 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-03-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 30-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: AMBIKA MOHANTY
• Keywords: Salary income; Opportunity of being heard; Principle of natural justice; Source of fund; Additional evidence
• Section: 142(1); 201; 68

Judgement Text

, . . , , IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH , CUTTACK , BEFORE SHRI CHANDRA MOHAN GARG, JUDICIAL MEMBER ./ ITA NO. 295 / CTK /20 1 8 ( / ASSE SSMENT YEAR : 20 1 0 - 20 1 1 ) SHRI MANPREET SINGH, N - 1/99, IRC VILLAGE, NAYAPALLI BHUBANESWAR - 751015 VS. ITO, WARD - 5(2), BHUBANESWAR ./ ./ PAN/GIR NO. : A ZOPS 7752 G ( / APPELLANT ) .. ( / RESPONDENT ) /AS SESSEE BY : SHRI AMBIKA MOHANTY , AR /REVENUE BY : SHRI SUBHENDU DUTTA , DR / DATE OF HEARING : 0 8 / 0 3 /201 9 / DATE OF PRONOUNCEMENT 11 / 0 3 /201 9 / O R D E R THIS APPEAL HAS BEEN FILED BY TH E ASSESSEE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) - 2 , BHUBANESWAR , DATED 22.05.2018 PASSED IN FIRST APPEAL NO. 0202 / 20 17 - 18 FOR THE ASSESSMENT YEAR 201 0 - 201 1 . 2. LD. AR HAS FILED REVISED GROUNDS OF APPEAL WHICH READ AS UNDER : - GROUND NO.1 UNDER THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LEARNED COMMISSIONER OF INCOME TAX APPEALS - LL, BHUBANESWAR ['CIT(A)'] HAS LEGALLY ERRED IN NOT CONSIDERING THE ADDITIONAL EVIDENCE OF SOURCE OF CASH DEPOSIT IN THE FORM OF LOAN CONFIRMATIONS, AND CONF IRMING THE ACTION OF LEARNED AO OF ADDITION OF RS 5 LAKHS, ON THE BASIS OF CONJUNCTURE AND SURMISE, WITHOUT CONSIDERING THE FACT THAT THE CASH IS SOURCED FROM THE EARLIER SAVINGS OF THE ASSESSEE . GROUND NO.2 UNDER THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LEARNED COMMISSIONER OF INCOME TAX APPEALS - LL, BHUBANESWAR ['CIT(A)'J HAS LEGALLY ERRED IN NOT CONSIDERING THE WRITTEN SUBMISSION OF THE ASSESSE THAT ALL THE SUMS DEPOSITED HAS BEEN WITHDRAWN DURING THE ITA NO. 295 /CTK/ 201 8 2 SAME FINANCIAL YEAR AND THEREBY FAILED TO HOLD THE ACTION OF LEARNED AO IN ADDITION OF RS 5.00 LAKHS TO BE WRONG WITHOUT ESTABLISHING THE UTILIZATION OF THE SAID SUM FOR ANY OTHER PURPOSE/ INVESTMENT. GROUND NO.3 UNDER THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LEARNED INCOME TAX OFFICER WARD - 5( 2), BHUBANESWAR, ['AO'] HAS LEGALLY ERRED IN NOT ALLOWING THE ASSESSE TO JUSTIFY AND FOREWORD HIS CASE AFTER MAKING SUBMISSION ON 30.11.2017 AND PASSED THE ORDER ON THE SAME DATE THEREBY PASSING AN ORDER DEVOID OF PRINCIPLE OF NATURAL JUSTICE AND HENCE UNT ENABLE. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND DERIVES INCOME FROM SALARY. THE ASSESSEE FILED ITS RETURN OF INCOME ON 21.04.2017 FOR THE ASSESSMENT YEAR 2010 - 2011 DECLARING TOTAL INCOME OF THE ASSESSEE AT RS.88,170/ - . THEREA FTER THE ASSESSMENT WAS COMPLETED U/S.143(3)/147 OF THE ACT IN WHICH THE AO COMPUTED THE TOTAL INCOME OF THE ASSESSEE AT RS.5,88,170/ - . 4. AGGRIEVED THEREBY, THE ASSESSEE TAKEN THE MATTER TO THE CIT(A) AND REITERATED THE SUBMISSIONS AS WAS MADE BEFORE THE AO. THE CIT(A) OBSERVED THAT THE ASSESSEE HAS NOT TAKEN THE PLEA OF RECEIPT OF CASH LOAN FROM HIS RELATIVES AND FRIENDS DURING THE ASSESSMENT PROCEEDINGS AND NO REASONS HAVE BEEN GIVEN BY THE ASSESSEE AS TO WHY THE CONFIRMATIONS OF THE PERSONS FROM WHOM TH E ASSESSEE HAS RECEIVED CASH LOAN BEFORE THE AO. LD. CIT(A) FURTHER OBSERVED THAT THE ASSESSEE HAS ALSO NOT MADE SUBMISSION THAT UNDER WHICH CLAUSE OF RULE 46A, THE ADDITIONAL EVIDENCE COULD BE ACCEPTED UNDER THE APPELLATE STAGE. ACCORDINGLY, THE CIT(A) CO NFIRMED THE ADDITION MADE BY THE AO. 5. NOW, THE ASSESSEE IS IN FURTHER APPEAL BEFORE THE TRIBUNAL. 6. LD. AR SUBMITTED THAT IN RESPONSE TO THE NOTICE ISSUED BY THE AO U/S. 142(1) OF THE ACT 17.10.2017, THE ASSESSEE FILED WRITTEN SUBMISSIONS ITA NO. 295 /CTK/ 201 8 3 ON 30.11.2017, EXPLAINING THAT THE ASSESSEE DEPOSITED AMOUNT OF RS.5,00,000/ - IN CASH ON 26.06.2009 IN HIS BANK ACCOUNT IS OUT OF THE PAST SAVINGS. HOWEVER, THE AO FRAMED THE ASSESSMENT ON THE DATE OF FILING OF WRITTEN SUBMISSION BY THE ASSESSEE I.E. ON 30.11.2017, WITH OUT ISSUING ANY SHOW CAUSE NOTICE OR ANY FURTHER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. IT WAS THE FURTHER CONTENTION OF LD. AR THAT THE ASSESSEE HAD DULY FURNISHED AVAILABLE DETAILS OF SOURCE OF FUND BEFORE AO. I T IS ALSO SUBMITTED THAT THE AO HAS AD OPTED THE BANK PASSBOOK/ BANK STATEMENT AS BASIS OF EVIDENCE OF ADDITION, WHICH CANNOT BE REGARDED AS A BOOK OF THE ASSESSEE . IN THIS REGARD, LD. AR PLACED RELIANCE ON THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT V BHAICHAND S GANDHI. [1983] 141ITR 67 (BOM) AND THE DECISION OF HONBLE GUWAHATI HIGH COURT, IN CASE OF ANANDRAM RAITANI VRS. CIT (1997)223 ITR 544, AND SUBMITTED THAT T HE ASSESSING OFFICER BEFORE IN VOKING THE POWER UNDER SECTION 68 OF T HE ACT MUST BE SATISFIED THAT THERE ARE BOOKS OF ACCOUNTS MAINTAINED BY THE ASSESS E E AND THE CASH CREDIT IS RECORDED IN THE SAID BOOKS OF ACCOUNTS. THUS EXISTENCE OF BOOKS OF ACCOUNTS IS A PRE - CONDITION FOR INVOKING POWER AND DISCHARGING THE BURDEN IS A SUBSEQUENT CONDITION. SINCE, THE ASSESSEE IS NOT MAINTAINING ANY BOOKS OF ACCOUNT, THERE IS NO QUESTION OF ANY CREDIT RECORDED IN THE BOOKS AND , HENCE , PRAYED THAT ADDITION MADE ON THIS GROUND IS ILLEGAL AND THEREFORE REQUIRES TO BE DELETED. 7. WITH REGARD SUBMISSION OF ADDITIONAL EVIDENCE BEFORE THE C IT(A), LD. AR SUBMITTED THAT THE ASSESSEE HAS RECEIVED CASH LOAN FROM HIS FRIENDS ITA NO. 295 /CTK/ 201 8 4 AND RELATIVES AND REPAID THE SAME AFTER NON - MATERIALIZATION OF PROPERTY DEAL . IT IS ALSO SUBMITTED THAT THE ASSESSEE COULD NOT COLLECT THE CONFIRMATION S OF THOSE PERSONS AT T HE TIME OF ASSESSMENT AND THE SAME WERE SUBMITTED BEFORE THE CIT(A). HOWEVER, THE CIT(A) WITHOUT CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AS WELL AS THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE UNDER RULE 46A, HAS WENT WITH THE AO IN CONFIRMING THE ADD ITION , WHICH IS NOT SUSTAINABLE IN THE EYES OF LAW AND PRAYED FOR DELETING THE ADDITION. 8. PER CONTRA , LD. DR RELIED ON THE O RDERS OF LOWER AUTHORITIES. 9. I HAVE HEARD RIVAL SUBMISSIONS OF BOTH THE PARTIES AND CAREFULLY PERUSED THE MATERIAL EVIDENCE PLAC ED ON THE RECORD OF TRIBUNAL. PRIMA FACIE, THE CONTENTION OF LD.AR IS THAT THE ASSESSEE HAD DULY FURNISHED AVAILABLE DETAILS OF SOURCE OF FUND BEFORE AO AND THE AO HAS ADOPTED THE BANK PASSBOOK/BANK STATEMENT AS BASIS OF EVIDENCE OF ADDITION, WHICH CANNOT BE REGARDED AS A BOOK OF THE ASSESSEE . WITH REGARD TO CONFIRMATION OF FOUR PERSONS, THE LD. AR OF THE ASSESSEE SUBMITTED THAT THE ASSESSEE COULD NOT SUBMIT THE CONFIRMATION FROM THE FOUR PARTIES BEFORE THE AO DURING THE ASSESSMENT PROCEEDINGS AS THE AO DID NOT ASK THE ASSESSEE TO PRODUCE THE SAME AND THE SAME WERE COLLECTED AND SUBMITTED BEFORE THE CIT(A) IN THE APPELLATE STAGE. HOWEVER, THE CIT(A) DID NOT ACCEPT THE ADDITIONAL EVIDENCE SO FILED BY THE ASSESSEE OBSERVING THAT THE ASSESSEE HAS NOT MADE ANY A PPLICATION OR SUBMISSION UNDER RULE 46A OF INCOME TAX RULES, 1962 . IN MY OPINION, THE ASSESSEE SHOULD BE ALLOWED TO DISCHARGE HIS ONUS LYING ON HIS SHOULDER U/S.68 OF THE ACT. ITA NO. 295 /CTK/ 201 8 5 THEREFORE, IN MY CONSIDERED VIEW, TO MEET THE END S OF JUSTICE AND TO AVOID THE M ULTIPLICITY OF PROCEEDINGS, THE CASE OF THE ASSESSEE IS RESTORED BACK TO THE FILE OF AO TO ADJUDICATE THE ISSUE ONLY TO THE EXTENT OF DEPOSIT OF RS.5 LAKHS IN THE BANK ACCOUNT OF THE ASSESSEE AFTER AFFORDING DUE OPPORTUNITY OF HEARING TO THE ASSESSEE AND W ITHOUT BEING PREJUDICE TO THE EARLIER ASSESSMENT AND FIRST APPELLATE ORDERS. 7 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. O RDER PRONOUNCED IN THE OPEN COURT ON 11 / 0 3 / 201 9 . SD/ - ( CHANDRA MOHAN GARG ) / JUDICIAL MEMBER CUTTACK ; DATED 11 / 03 /201 9 . . / PKM , S R.P.S. / COPY OF THE ORDER FORWARDED TO : / BY ORDER, ( SENIOR PRIVATE SECRETARY ) , / ITAT, CUTTACK 1. / THE APPELLANT - . SHRI MANPREET SINGH, N - 1/99, IRC VILLAGE, NAYAPALLI , BHUBANESWA R - 751015 2. / THE RESPONDENT - ITO, WARD - 5(2), BHUBANESWAR 3. ( ) / THE CIT(A), 4. / CIT 5. , , / DR, ITAT, CUTTACK 6. / GUARD FILE. //TRUE COPY//