I.T.O., Ward-4, Aligarh V. Sh. Ashish Sharma S/o Sh. Umesh Chandra Sharma, Aligarh

ITA 3/AGR/2011

• Counselvise Citation: 320314 RSA 2011
• Duration Of Justice: 9 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-10-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 17-10-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 05-01-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Salary income; Valuation report; Onus to prove
• Section: 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, AGRA BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER ITA NO.03/AGR/2011 ASSESSMENT YEAR: 2004-05 INCOME TAX OFFICER, VS. SHRI ASHISH SHARMA, WARD 4, ALIGARH. S/O. SHRI UMESH CHANDRA SHARMA, MISSION INTERNATIONAL ACADEMY KHAIR BYE PASS ROAD, NAGLA KALAR, ALIGARH. (PAN: AMHPS 7743 P). (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI WASEEM ARSHAD, SR. D.R. RESPONDENT BY : SHRI RAJENDRA PRASAD, ADVOCATE DATE OF HEARING : 17.10.2011 DATE OF PRONOUNCEMENT : 17.10.2011 ORDER PER H.S. SIDHU, J.M. : THE REVENUE HAS FILED THE PRESENT APPEAL AGAINST TH E IMPUGNED ORDER DATED 25.10.2010 PASSED BY THE LD. CIT(A), GHAZIABAD FOR THE ASSESSMENT YEAR 2004-05 ON THE FOLLOWING GROUNDS OF APPEAL :- ITA NO.03/AGR/2011 A.Y. 2004-05 2 1. WHETHER THE LD. CIT (APPEALS) ERRED IN LAW AND ON FACTS BY RELYING ON THE PRESUMPTION THAT NO CONSTRUCTION TOO K PLACE DURING THE YEAR UNDER CONSIDERATION. 2. WHETHER THE LD. CIT (APPEALS) ORDER IS PERVERSE TO THE EXTENT THAT IT SIMPLY IGNORED THE YAWNING GAP BETWEEN VALU E OF CONSTRUCTION AS DISCLOSED BY ASSESSEE AND AS VALUED BY D.V.O. AN D BELITTLING THE D.V.O.S REPORT ? 3. WHETHER THE LD. CIT (APPEALS) ORDER IS PERVERSE TO THE EXTENT THAT ONUS TO PROVE THE PERIOD OF CONSTRUCTION LIED ON ASSESSEE ? THE ONUS WHICH WAS NEVER DISCHARGED BY THE ASSESSEE. 2. THE FACTS NARRATED BY THE DEPARTMENT ARE NOT DIS PUTED BY BOTH THE PARTIES, THEREFORE, NO NEED TO REPEAT THE SAME FOR THE SAKE OF CONVENIENCE. 3. AT THE TIME OF HEARING, THE LD. COUNSEL FOR THE ASSESSEE STATED THAT THE LD. FIRST APPELLATE AUTHORITY HAS DECIDED THE ISSUE IN DISPUTE ON THE BASIS OF THE DECISION OF I.T.A.T., AGRA BENCH PASSED IN ITA NO.4 61/2009 IN THE CASE OF MRS. LAXMI GAUR VS. ITO AND UPHELD THE SUBSTANTIAL ADDIT ION AND DELETED THE PROTECTIVE ADDITION WHILE DECIDING THE LEGAL GROUND IN THE CAS E OF THE ASSESSEE WHICH IS APPLICABLE. 4. ON THE CONTRARY, THE LD. DEPARTMENTAL REPRESENTA TIVE RELIED UPON THE ORDER PASSED BY THE ASSESSING OFFICER. ITA NO.03/AGR/2011 A.Y. 2004-05 3 5. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE R ELEVANT RECORDS AVAILABLE WITH US, ESPECIALLY, THE IMPUGNED ORDER IN WHICH TH E LD. FIRST APPELLATE AUTHORITY HAS DECIDED THE LEGAL ISSUE IN FAVOUR OF THE ASSESS EE. FOR THE SAKE OF CONVENIENCE, THE RELEVANT PORTION OF THE ORDER OF THE CIT(A) AT PARAGRAPH NO.5, PAGE NOS.7 TO 9 IS REPRODUCED AS UNDER :- 5. AFTER CAREFUL CONSIDERATION OF RELEVANT FACTS O N RECORD AND RIVAL CONTENTIONS, MY CONCLUSIONS/OBSERVATIONS ARE AS UND ER : (1) GROUNDS OF APPEAL NO.1, 2, 3, 4, 5 & 6 ARE REJE CTED BECAUSE THE ASSESSING OFFICER HAD RECEIVED INFORMATION FROM ANO THER ITO WHICH WAS VALID BASIS FOR HIM TO FORM REASONABLE BELIEF T HAT INCOME HAS ESCAPED ASSESSMENT. ON THE POINT OF ISSUANCE OF NO TICE U/S 148; ASSESSING OFFICER IS NOT REQUIRED TO ESTABLISH THE ACCURACY OF THE INFORMATION. RELIANCE IS PLACED ON DECISION OF SUP REME COURT IN THE CASE OF RAYMOND WOOLEN MILLS. FURTHER, APPELLANT H AD NOT FILED ANY RETURN; ASSESSING OFFICER WAS NOT DUTY BOUND TO ISS UE IN NOTICE U/S 143(2). FURTHERMORE, ASSESSEES OBJECTION TO NOTIC E U/S 148 WAS PROPERTY MET BY ASSESSING OFFICER, IN THE ASSESSMEN T ORDER, SAYING THAT PURCHASE HAD BEEN ADMITTEDLY MADE IN NAME OF A PPELLANT (MINOR) AND NOW APPELLANT HAD BECOME MAJOR; AND SO, ACTION COULD BE TAKEN IN THE HANDS OF THE ASSESSEE. (2) HOWEVER, ON OTHER GROUNDS OF APPEAL; APPELLANT SUCCEEDS BECAUSE OF FOLLOWING REASONS: A. THIS IS A PROTECTIVE ASSESSMENT. IN THE CASE OF SMT. LAXMI GAUR WHERE ADDITION WAS MADE ON SUBSTANTIVE BASIS, THE H ONBLE ITAT HAS ALREADY GIVEN CATEGORICAL FINDING AS UNDER : .. AFTER CONSIDERING THE SUBMISSIONS AND PERUSI NG THE MATERIAL ON RECORD ALONG WITH VARIOUS CASE LAWS, WE FIND THAT ASSESSEE DESERVES TO SUCCEED IN BOTH THE ISSUES RAISED. FRO M THE DAY ONE THE ASSESSEE IS ARGUING THAT NO INVESTMENT HAS BEEN MAD E IN THE HOUSE PROPERTY DURING ASSESSMENT YEAR 2003-04 OR 04-05. WHATEVER THE ITA NO.03/AGR/2011 A.Y. 2004-05 4 INVESTMENT MADE ON ACCOUNT OF PURCHASE OF LAND AND THEREAFTER ON ACCOUNT OF CONSTRUCTION OF THE HOUSE ON THE SAID LA ND AND THEREAFTER ON ACCOUNT OF CONSTRUCTION OF THE HOUSE ON THE SAID LAND WERE MADE BETWEEN ASSESSMENT YEARS 1999-00 TO 2001-02. IT IS ALSO A MATTER OF FACT THAT WHATEVER THE INVESTMENT MADE IN THESE YEA RS THEY WERE SHOWN IN THE REGULAR RETURNS FILED BY THE ASSESSEE. THEREAFTER NOTICE UNDER SECTION 142(2) WAS ISSUED BY THE ITO ASKING F OR THE DETAILS OF LAND PURCHASED AND CONSTRUCTION OF THE HOUSE. COPY OF NOTICE IS PLACED IN THE PAPER BOOK AT PAGE 21 OF THE PAPER BO OK. FROM THIS NOTICE IT IS CLEAR THAT ASSESSEE WAS ASKED TO FILE THE SOURCE OF INVESTMENT IN PLOT AND FOR CONSTRUCTION AND VALUATI ON REPORT. THE ASSESSEE HAD FILED THE DETAILS OF INVESTMENT ALONG WITH COPY OF VALUATION REPORT. COPY OF LETTER FILED BEFORE ASSE SSING OFFICER IN RESPONSE TO NOTICE UNDER SECTION 142(2) IS PLACED A T PAGES 22 TO 25. FURTHER LETTER FILED BEFORE ASSESSING OFFICER SHOWI NG THE SUMMARY OF TOTAL CAPITAL AND INVESTMENT AS ON 31.03.2002, COPY OF WHICH IS PLACED AT PAGE 18 OF THE PAPER BOOK. ALL THESE DETAILS WE RE FILED BEFORE ASSESSING OFFICER AS WELL AS BEFORE LD. CIT(A). HO WEVER, THEY HAVE NOT TAKEN INTO CONSIDERATION AT ALL. THE ASSESSING OFFICER AS WELL AS LD. CIT(A) ARE SILENT ON THESE DETAILS. FROM THESE DETAILS IT IS CLEAR THAT INVESTMENT OF ` 11.50 LACS WAS MADE PRIOR TO A.Y. 2002-03. THEREFORE, THERE IS NO QUESTION OF DRAWING ANY ADVE RSE INFERENCE AGAINST THE ASSESSEE THAT THESE INVESTMENTS HAVE BE EN MADE DURING THE YEAR UNDER CONSIDERATION I.E. 2004-05. EVEN THERE WAS NO OCCASION TO REFER THE MATTER TO THE DVO FOR VALUING THE COST OF CONSTRUCTION FOR THE YEAR UNDER CONSIDERATION. IF ASSESSING OFFICER WAS NOT SATISFIED WITH THE DETAILS OF INVESTMENT MADE BY THE ASSESSEE, THE N HE SHOULD HAVE REOPENED THE ASSESSMENTS FOR A.Y. 2001-02 AND 02-03 BUT NOT OF A.Y.2004-05. THERE IS NO MATERIAL WITH THE ASSESSI NG OFFICER TO DRAW AN INFERENCE THAT ANY INVESTMENT HAS BEEN MADE IN T HE YEAR UNDER CONSIDERATION. ONLY ON VERBAL INFORMATION RECEIVED FROM ADDITIONAL CIT OF RANGE, THE ASSESSING OFFICER RECORDED THE RE ASONS, WHICH, IN OUR CONSIDERED VIEW IS NOT AS PER PROVISIONS OF LAW . . IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES, WE HOLD THAT ADDITION MADE DURING THE YEAR UNDER CONSIDERAT ION WAS WITHOUT ANY BASIS AS NO INVESTMENT HAS BEEN MADE IN THE YEA R UNDER CONSIDERATION. ANY ADDITION CAN BE MADE IN THE YEA R IN WHICH THE INVESTMENT HAS BEEN MADE. SECONDLY, AS STATED ABOV E, THERE WAS NO ITA NO.03/AGR/2011 A.Y. 2004-05 5 MATERIAL WITH THE ASSESSING OFFICER TO HOLD OR TO F ORM AN OPINION THAT ANY INCOME HAS ESCAPED ASSESSMENT. THEREFORE, ISSU ANCE OF NOTICE WAS ALSO BAD IN LAW. ACCORDINGLY WE ALLOW THESE GR OUNDS OF THE ASSESSEE. THE ABOVE REASONING IS VALID FOR THIS CASE AS WELL. B. EVEN THE ASSESSING OFFICER HAS HIMSELF GIVEN THE FINDING THAT NO INVESTMENT CAN BE MADE BY THE APPELLANT, AS APPELLA NT WAS MINOR TILL LAST F.Y., WHILE, IN THIS F.Y. HE IS MERELY HAVING SALARY INCOME. C. VALUATION REPORT DOES NOT GIVE BIFURCATION OF IN VESTMENT YEAR- WISE. D. THE ASSESSING OFFICER OF LAXMI GAUR AS WELL AS O F ASSESSEE SHOULD HAVE REOPENED, IF AT ALL, ASSESSMENT PROCEED ING FOR ASSESSMENT YEAR 2001-02 AND 02-03, AS PER FINDING GIVEN BY ITA T. THERE IS NO BASIS FOR MAKING ANY ADDITION IN A.Y. 2004-05. (3) THUS, THE ADDITION IN THE HAND OF APPELLANT, ES PECIALLY IN ASSESSMENT YEAR 2004-05 IS WITHOUT ANY BASIS. THE SAME IS DELETED. 6. AFTER GOING THROUGH THE AFORESAID FINDING OF THE LD. FIRST APPELLATE AUTHORITY, WE ARE OF THE CONSIDERED OPINION THAT NO INTERFERENCE IS CALLED FOR IN THE WELL REASONED ORDER PASSED BY THE LD. FIRST APPELLA TE AUTHORITY WHICH IS ON THE BASIS OF DECISION PASSED BY I.T.A.T., AGRA BENCH IN ITA NO.461/2009 IN THE CASE OF MRS. LAXMI GAUR VS. ITO. THE LD. DEPARTMENTAL R EPRESENTATIVE HAS ALSO NOT PRODUCED ANY CONTRARY DECISION ON THE ISSUE IN DISP UTE OR ANY SUBSEQUENT ORDER PASSED BY THE HIGH COURT. THEREFORE, KEEPING IN VI EW THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE, THE APPEAL FILED BY THE REVENU E IS DISMISSED. ITA NO.03/AGR/2011 A.Y. 2004-05 6 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. (ORDER PRONOUNCED IN THE OPEN COURT ON 17.10.2011). SD/- SD/- (B.C. MEENA) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER DATE: 17 TH OCTOBER, 2011 PBN/* COPY OF THE ORDER FORWARDED TO: APPELLANT/RESPONDENT/CIT CONCERNED/CIT(APPEALS) CO NCERNED/D.R., ITAT, AGRA BENCH, AGRA/GUARD FILE. BY ORDER ASSISTANT REGISTRAR INCOME-TAX APPELLATE TRIBUNAL, AGRA TRUE COPY