Sh. Anil Handa, Ludhiana V. ITO, Ludhiana

ITA 3/CHANDI/2017

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 8223 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-03-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2004-2005
• Appeal Filed On: 02-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES, SMC, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA NO. 3/CHD/2017 ASSESSMENT YEAR: 2004-05 SH. ANIL HANDA, VS. THE ITO, WARD-6(1), PROP. M/S NEELAM STEELS, LUDHIANA LUDHIANA PAN NO. AAVPH5668L (APPELLANT) (RESPONDENT) APPELLANT BY : SH. SUDHIR SEHGAL RESPONDENT BY : SH. S.K. MITTAL DATE OF HEARING : 20.03.2017 DATE OF PRONOUNCEMENT : 24.03.2017 ORDER THE PRESENT APPEAL BY THE ASSESSEE IS DIRECTED AGA INST THE ORDER OF CIT (A)-4, LUDHIANA DATED 9.11.2016 FOR ASSESSMENT YEAR 2004-05. 2. THE GROUNDS TAKEN BY THE ASSESSEE ARE AS UNDER:- 1. THAT THE WORTHY COMMISSIONER OF INCOME TAX (APPEALS ) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 20,00,0 00/- (TWENTY LACS) ON ACCOUNT OF ALLEGED SALE OF EXPORT LICENSE, WHICH HAS NOT BEEN ACTUALLY SOLD BY THE AS SESSEE AS PER PARA 6.3 OF HIS ORDER. 2. THAT THE WORTHY CIT (A) HAS FURTHER ERRED IN NOT CONSIDERING THAT ALTERNATIVELY, THE LD. ASSESSING OFFICER 2 SHOULD HAVE CONSIDERED THE CLAIM OF RS. 19,25,000/- AS EXPENSE WITH REGARD TO SALE OF EXPORT LICENSE AND A S SUCH, THE ASSESSING OFFICER HAS PARTLY RELIED UPON THE FACTS GIVEN IN THE COMPLAINT FOR MAKING THE ADDITIO N AND IGNORING NOT CONSIDERING THE FACTS, WHICH ARE FAVOU RABLE TO THE ASSESSEE. 3. THAT THE WORTHY CIT (A) HAS ERRED IN NOT CONSIDERIN G THAT THE ASSESSING OFFICER SHOULD HAVE CONSIDERED T HE FACTS IN THE COMPLAINT AS A WHOLE AND NOT IN PARTS. 4. THAT THE ADDITION OF RS. 20,00,000/- (TWENTY LACS) AS UPHELD IS AGAINST THE FACTS AND CIRCUMSTANCES OF TH E CASE. 5. THAT THE DETAILED SUBMISSIONS FILED BY THE APPELLAN T DURING THE COURSE OF HEARING ESPECIALLY VIDE LETT ER, DATED 18.10.2016 MENTIONED IN PARA 10,11,12 & 13 OF THE ORDER HAS NOT BEEN CONSIDERED PROPERLY. 6. THAT THE APPELLANT CRAVES LEAVE TO ADD OR AMEND T HE GROUNDS OF APPEAL BEFORE THE APPEAL IS FINALLY HEAR D OR DISPOSED OFF. 3. I HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PAR TIES AND PERUSED THE MATERIAL ON RECORD. 4. THIS IS THE SECOND ROUND OF APPEAL BEFORE THE IT AT. THE BRIEF FACTS OF THE CASE ARE AS UNDER:- RETURN DECLARING AN INCOME OF RS. 62,088/- WAS FILE D BY THE ASSESSEE ON 28.10.2004. THE RETURN WAS PROCESSED U/S 143(1)(A ) OF THE INCOME-TAX ACT, 1961 ON 15.2.2005 AND THE ASSESSMENT ORDER WAS PASS ED ON 2.3.2015. THE ASSESSEE IS AN EXPORTER AND ISSUE RELATES IN THE AP PEAL WAS THAT DURING THE YEAR THE ASSESSEE SOLD EXPORT LICENSE NO. 30100222 97 DATED 17.2.2003 FOR 3 RS. 20 LACS IN THE OPEN MARKET IN OCTOBER 2003. THE ASSESSING OFFICER TREATED THIS AMOUNT AS UNDISCLOSED INCOME NOT REFLE CTED IN RETURN OF INCOME. IT WAS CLAIMED BY THE ASSESSEE THAT LICENS E WAS NOT SOLD AND NO LICENSE AMOUNT WAS RECEIVED. THE ITAT VIDE ORDER DA TED 28.3.2013 HAS RESTORED THE MATTER TO CARRY OUT NECESSARY VERIFICA TION. THE HON'BLE ITAT HELD AS UNDER:- IN THE ENTIRETY OF FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE VIEW THAT ISSUE NEEDS TO BE RESTORED BACK TO THE FILE OF THE ASSESSING OFFICER TO CARRY OUT NECESSARY VERIFICATION ON THE ISSUE IN HAND. ACCORDINGLY, WE REMIT THE ISSUE BACK TO THE FILE OF THE ASSESSING OFFICER TO DECIDE THE SAME AFTER CONSIDERING THE REPLY AND EVIDENCES PRODUCED BY THE ASSESSEE. 5. DURING ASSESSMENT PROCEEDINGS THE ASSESSEE SUBMI TTED THAT HE HAD NEVER SOLD ANY ADVANCE LICENSE NOR RECEIVED ANY AMO UNT FROM ANY ONE AS ALLEGED. THE ASSESSING OFFICER OBSERVED THAT NO NEW FACTS HAVE COME ON RECORD AND THE SAME AMOUNT HAS BEEN ADDED AS UNDISC LOSED INCOME. 6. ITAT VIDE ORDER DATED 28.3.2013 HAS RESTORED THE MATTER BACK TO THE ASSESSING OFFICER TO CARRY OUT VERIFICATION. DURING SET ASIDE PROCEEDINGS, NO IOTA OF VERIFICATION PROCESS OR INVESTIGATION OR ANY OTHER ENQUIRY WAS UNDERTAKEN BY THE ASSESSING OFFICER TO PRIMA FACIE PROVE THAT THE LICENSE HAS BEEN SOLD. NO EVIDENCE WAS BROUGHT ON RECORD TO PROVE THE SALE OF LICENSE. THE MATTER WENT BEFORE THE LD. CIT(A). TH E LD. CIT(A) VIDE HIS ORDER DATED 9.11.2016 CONFIRMED THE ADDITION BASED ON THE FIR LODGED BY 4 THE FATHER OF THE ASSESSEE AGAINST ONE SHRI BHUSHAN GHAI REGARDING THE APPREHENSION OF ALLEGED MISUSE OF THE LICENSE. 7. BEFORE US, THE ASSESSEE REITERATED THE ARGUMENTS TAKEN BEFORE THE AUTHORITIES BELOW. THE LD. SR. DR RELIED UPON THE O RDER OF CIT(A). THE REVENUE HAS NOT PROVED ANYTHING ABOUT THE ALLEGED S ALE OF THE ADVANCE LICENSE. NO EVIDENCE OF SALE OF LICENSE HAS BEEN B ROUGHT ON RECORD. IF THE ASSESSING OFFICER WANTED TO TAX RS. 20 LACS ON ACCO UNT OF ALLEGED SALE OF LICENSE, ONUS WOULD BE ON ASSESSING OFFICER TO PROV E IT BY RELEVANT AND COGENT EVIDENCE, HOWEVER, ASSESSING OFFICER FAILED TO DO SO. RELIANCE ON FIR IS MISPLACED BECAUSE IT IS ONLY INFORMATION AND IS NOT EVIDENCE. FURTHER IT IS NOT LODGED BY ASSESSEE. THE CANONS OF TAXATION REQUIRES THAT IF AN AMOUNT IT BROUGHT TO TAX IT HAS TO BE PROVED THAT THE AMOUNT HAS INDEED BEEN RECEIVED OR DEEMED TO HAVE BEEN RECEIVE D AND INDEED TAXABLE. SINCE THE REVENUE DID NOT PROVE ABOUT ANY FACT ON R ECORD REGARDING THE ALLEGED SALE OF LICENSE, I DO NOT SEE ANY MERIT IN CONFIRMING THE LD. CIT(A)S ORDER. HENCE, THE ADDITION OF RS. 20 LAC S IS HERBY DELETED. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DATED : 24- 03-2017 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR 5