Sudhir Gandhi, New Delhi V. ACIT, New Delhi

ITA 2950/DEL/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 77741 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-05-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 12-05-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 13-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G H SEMA
• Assessee Lawyers: ANKUSH GUPTA
• Keywords: Principle of natural justice; Corroborative evidences
• Section: 142(1)

Judgement Text

ITA NO. 2950/DEL/2013 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: G NEW DELHI BEFORE SHRI S. V. MEHROTRA, ACCOUNTANT ME MBER AND SHRI CHANDRA MOHAN GARG, JUDICIAL MEMBER I.T.A .NO. 2950 /DE L/2013 (ASSESSMENT YEAR:- 2009-10 SUDHIR GANDHI E-44/9, KISHAN GARH, NEAR SECTOR-A, POKCET-A, VASANT KUNJ NEW DELHI PAN:- AEUPG1902P (APPELLANT) VS ACIT CIRCLE 38(1) NEW DELHI (RESPONDENT) APPELLANT BY SH. DEEPAK BANSAL & SH. ANKUSH GUPTA, C.A RESPONDENT BY SH. G. H. SEMA, SR. DR ORDER PER CHANDRA MOHAN GARG, JM THIS APPEAL HAS BEEN PREFERRED BY THE ASSESSEE AGA INST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)- XXVIII, NEW D ELHI DATED 8/2/2013 IN APPEAL NO. 335/2011-12 FOR THE A. Y 2009-10. 2. BRIEFLY STATED THE FACTS GIVEN RISE TO THIS APPE AL ARE THAT, THE CASE WAS SELECTED FOR SCRUTINY UNDER CASS. THE NOTICES U/S 143(2) 142(1) OF THE INCOME TAX ACT 1961 (FOR SHORT THE ACT) ALONG WITH DETAILE D QUESTIONNAIRE WERE ISSUED TO THE ASSESSEE. THE ASSESSING OFFICER HOLD THAT CONS IDERING THE INCREASE IN TURNOVER AND THE SLIGHT FALL IN THE NET PROFIT RATE IS JUSTI FIED, ACCORDINGLY NO ADVERSE INFERENCE IS DRAWN WITH RESPECT TO FINANCIAL RESULTS DECLARED BY THE ASSESSEE. DURING THE ITA NO. 2950/DEL/2013 2 COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFF ICER MADE CERTAIN DISALLOWANCES AMOUNTING TO RS.4,42,346/- PERTAINING TO SALARY EXPENSES, ENTERTAINMENT EXPENSES, UNVERIFIABLE PURCHASE, TRAV ELLING EXPENSES, TELEPHONE EXPENSES AND INTEREST RECEIVED ON SECURITY AND OTHE R SOURCES. 3. THE AGGRIEVED ASSESSEE PREFERRED AN APPEAL BEFOR E CIT(A) WHICH WAS ALSO DISMISSED BY THE CIT(A) BY PASSING THE IMPUGNED ORD ER. NOW, THE ASSESSEE IS BEFORE THIS TRIBUNAL WITH THE GROUNDS AS MENTIONED BELOW:- 1. THAT THE LEARNED ACIT HAS ERRED IN LAW AND FACT S OF THE CASE IN DETERMINING THE TOTAL INCOME AT RS.64,83,680/-. 2. THAT THE LEARNED ACIT HAS ERRED IN LAW AND FACTS OF THE CASE BY DISALLOWING RS.172756/- OUT OF SALARY EXPENSES ON T HE GROUND THAT SOME OF THE RECIPIENTS HAVE PUT THEIR THUMB IMPRESS IONS/SIGNATURES WHICH ARE NOT VERIFIABLE. 3. THAT THE LEARNED ACIT HAS ERRED IN LAW AND FACTS OF THE CASE IN DISALLOWING RS.7,804/- OUT OF ENTERTAINMENT EXPENSE S. 4. THAT THE LEARNED ACIT HAS ERRED IN LAW AND FACTS IN DISALLOWING RS.80970/- OUT OF UNVERIFIABLE PURCHASES. 5. THAT THE LEARNED ACIT HAS ERRED IN LAW AND FACTS IN DISALLOWING RS.81770-/- OUT OF THE TRAVELING EXPENSES OF RS.8,0 5,252/-. 6. THAT THE LEARNED ACIT HAS ERRED IN LAW AND FACTS IN DISALLOWING RS.13896/- BEING 1/10 TH OUT OF THE TELEPHONE EXPENSES OF RS.1,38,961/-. 7. THAT THE LEARNED ACIT HAS ERRED IN LAW AND FACTS IN DISALLOWING CREDIT OF TDS OF RS.14,82,749/- (RS.6,75,865/- ON P ROFESSIONAL RECEIPTS AND RS.806884/- ON CONTRACT RECEIPTS) ON T HE PRETEXT THAT THE SAME SHALL BE ALLOWED IN THE YEAR IN WHICH THE ADVA NCE IS SURRENDERED FOR TAXATION. 4. WE HAVE HEARD RIVAL ARGUMENTS BOTH THE PARTIES A ND CAREFUL PERUSED THE RECORD THE LD. ASSESSEES REPRESENTATIVE (AR) SUBMI TTED THAT THE ASSESSING OFFICER ACCEPTED THE FINANCIAL RESULTS AS DECLARED BY THE ASSESSEE BUT AT THE SAME TIME THE ASSESSING OFFICER MADE IMPUGNED DISALLOWAN CES WITHOUT ANY BASIS AND JUSTIFIED REASON. THE AR FURTHER CONTENDED THAT DU RING THE FIRST APPELLATE PROCEEDINGS, THE CIT(A) ALSO IGNORED SUBMISSIONS AN D CONTENTIONS OF THE ASSESSEE ITA NO. 2950/DEL/2013 3 AND UPHELD THE ORDER OF THE AO BY PASSING THE NON-S PEAKING MECHANICAL ORDER. THE AR FURTHER CONTENDED THAT THE CIT(A) CALLED A R EPORT FROM THE AO AND THE WRITTEN SUBMISSIONS OF THE ASSESSEE BEFORE CIT(A) D ATED 6 TH JUNE 2012 WHICH WERE SUBMITTED BY THE AO/ACIT VIDE DATED 6/8/2012 BUT TH E SAME WERE NOT CONSIDERED BY THE CIT(A) WHILE PASSING THE IMPUGNED ORDER. TH E LD. AR ALSO DRAWN OUR ATTENTION TOWARDS PAPER BOOK SPREAD OVER 56 PAGES A ND SUBMITTED THAT THE CIT(A) AND THE AO IGNORED THE DETAILED EVIDENCE, EXPLANATI ON, BILLS AND VOUCHERS SUPPORTING TO THE CLAIM OF THE ASSESSEE. THE AR VE HEMENTLY CONTENDED THAT THE CIT(A) ALSO IGNORED WRITTEN SUBMISSIONS DATED 4 TH SEPTEMBER 2012 OF THE ASSESSEE AND TDS CERTIFICATES SUBMITTED BY THE ASSESSEE. TH E AR STRENUOUSLY CONTENDED THAT THE AUTHORITIES BELOW IGNORED SUBMISSIONS AND SUPPORTING EVIDENCE OF THE ASSESSSEE WHILE PASSING THE IMPUGNED ORDERS WHICH I S AGAINST THE PRINCIPLES OF NATURAL JUSTICE AND THE EMPTY HANDED ASSESSEE IS HE LPLESS. 5. THE LD. DEPARTMENTAL REPRESENTATIVE (DR) REPLIED THAT IT IS ONUS ON THE ASSESSEE TO ESTABLISH ITS CLAIM WITH SUPPORTING EVI DENCE, BILLS AND VOUCHERS. THE DR FURTHER CONTENDED THAT IF THE ASSESSEE IS NOT DI SCHARGING ITS BURDEN/ONUS TO PROOF OF CLAIM THEN THE AO HAS NO OPTION BUT TO MAK E DISALLOWANCES TO COVER UP AND PREVENT POSSIBLE LEAKAGE OF REVENUE ON ACCOUNT OF VARIOUS CLAIMS. 6. ON CAREFUL CONSIDERATION OF ABOVE RIVAL SUBMISSI ONS AND CAREFUL PERUSAL OF THE RECORDS PLACED BEFORE US AT THE OUTSET, WE OBSE RVE THAT THE CIT(A) CALLED REMAND REPORT FROM THE AO/ ACIT ON THE WRITTEN SUBM ISSIONS OF THE ASSESSEE DATED 6/6/2012 AND THE AO SUBMITTED A DETAILED REPO RT DATED 6/8/2012 THEREON. WE ALSO OBSERVE THAT THE ASSESSEE SUBMITTED WRITTEN SU BMISSIONS BEFORE THE CIT(A) ON 4/9/2012 AND THE ASSESSEE ALSO SUBMITTED OTHER RELE VANT DETAILS OF PURCHASE, BILLS, SUPPORTING EVIDENCE AND TDS CERTIFICATES BEFORE THE AUTHORITIES BELOW BUT THE SAME HAVE NOT BEEN CONSIDERED WHILE PASSING THE IMP UGNED ORDER AND THE ASSESSMENT ORDER. IN VIEW OF ABOVE, AND A BARE REA DING OF THE IMPUGNED ORDER, WE ITA NO. 2950/DEL/2013 4 OBSERVE THAT THE APPEAL OF THE ASSESSEE HAS BEEN DI SMISSED ON THE BASIS OF ACRYPTIC AND MECHANICAL ORDER WITHOUT CONSIDERING THE RELEV ANT REMAND REPORT, SUBMISSIONS OF THE ASSESSEE AND OTHER RELEVANT EVIDENCE AND SUP PORTING DOCUMENTS. THE ASSESSING OFFICER ALSO IGNORED RELEVANT SUBMISSIONS , EXPLANATION AND SUPPORTING EVIDENCE OF THE ASSESSSE WHILE PASSING THE ASSESSME NT ORDER. IN THIS SITUATION, WE ARE OF THE CONSIDERED VIEW, THAT THE ISSUE OF ASSES SMENT FOR A. Y 2009-10 REQUIRES FRESH ADJUDICATION AT THE END OF AO. ACCORDINGLY, ORDERS OF THE AUTHORITIES BELOW ARE SET ASIDE BY RESTORING THE ENTIRE CONTROVERSY T O THE FILE OF AO WITH A DIRECTION THAT THE AO SHALL DECIDE THE CASE AFRESH BY AFFORDI NG DUE OPPORTUNITY OF HEARING AND WITHOUT BEING PREJUDICED WITH THE OBSERVATIONS AND FINDINGS IN THIS ORDER, IN THE IMPUGNED ORDER OF THE CIT(A) AND IN THE EARLIER ASSESSMENT ORDER. THE AO SHALL ADJUDICATE THE CASE AFRESH AND SHALL PASS A S PEAKING ORDER BY CONSIDERING ALL SUBMISSIONS, EXPLANATION AND SUPPORTING EVIDENCE OF THE ASSESSEE ON ALL THE ISSUES. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DIS POSED OF AND DEEM TO BE ALLOWED FOR THE STATISTICAL PURPOSES WITH THE DIREC TION TO THE AO AS MENTIONED HEREINABOVE. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 29 TH MAY 2014. SD/- SD/- (S.V.MEHROTRA) (C. M. GARG) ACCOUNTANT MEMBER JUDICI AL MEMBER DATED: 29/05/2014 *R. NAHEED* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ITA NO. 2950/DEL/2013 5 ASSISTANT REGISTRAR ITAT NEW DELHI