Sunita Sharma, Jodhpur V. DCIT, Central Circle-2, Jodhpur

ITA 30/JODH/2019

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5734 (ITAT-JODHPUR)
• Duration Of Justice: 3 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 29-01-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Notional interest; Set aside
• Section: 143(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH (SMC), JODHPUR BEFORE SHRI N.K. SAINI, VICE PRESIDENT ITA NO. 30/JODH/2019 (ASSESSMENT YEAR-2013-14) SMT. SUNITA SHARMA, 221-222, SHYAM NAGAR, PAL LINK ROAD, JODHPUR VS THE DCIT, CENTRAL CIRCLE-2, JODHPUR (APPELLANT) (RESPONDENT) PAN: AVGPS9795R REVENUE BY SH. P.K. SINGI, DR ASSESSEE BY SHRI AMIT KOTHARI, CA DATE OF HEARING 06.05.2019 DATE OF PRONOUNCEMENT 06.05.2019 O R D E R THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDE R DATED 26.12.2018 OF CIT(A)-2, UDIAPUR. 2. FOLLOWING GROUNDS HAVE BEEN RAISED IN THIS APPEA L:- 1) THAT THE LD. CIT(A) HAS ERRED IN MAKING ENHANCEMENT OF INCOME BY MAKING NOTIONAL ADDITION O F RS. 27,08,053/- FOR NOTIONAL INTEREST ON CAPITAL CONTRIBUTION TO FORM. THE ADDITION SO MADE IS BAD I N LAW AND BAD ON FACTS. 2 2) THE APPELLANT PRAY FOR SUITABLE COSTS. 3) THE APPELLANT CRAVE LIBERTY TO ADD, AMEND, ALTER MODIFY OR DELETE ANY OF THE GROUNDS OF APPEAL ON OR BEFORE ITS HEARING BEFORE YOUR HONOUR. 3. THE FACTS OF THE CASE IN BRIEF ARE THAT THE ASSE SSEE FILED THE RETURN OF INCOME DECLARING AN INCOME OF RS. 7,16,570/- WHI CH WAS PROCESSED U/S 143(1) OF THE INCOME TAX ACT, 1961 (IN SHORT 'T HE ACT'). LATER ON, THE CASE WAS SELECTED FOR SCRUTINY. THE ASSESSING OFFIC ER MADE THE ADDITION OF RS. 8,66,608/- ON ACCOUNT OF INTEREST PAID TO TH E BANK FOR THE REASON THAT THE ASSESSEE WAS NOT CHARGING INTEREST ON THE CAPITAL CONTRIBUTED. 4. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT(A) WHO ENHANCED THE ADDITION TO RS. 27,08,053/- FOR TH E REASON THAT THE ASSESSEE WAS A PARTNER OF M/S AYUSHI BUILDERS AND DEVELOPERS AND AS PER THE PARTNERSHIP DEED OF THE SAID FIRM, INTEREST @ 12% ON THE OPENING CAPITAL OF RS. 2,35,67,813/- I.E. RS. 27,08,053/- W AS DUE TO THE ASSESSEE AND WAS ASSESSABLE IN ASSESSEE'S HAND BUT ASSESSING OFFICER DID NOT MADE THE ADDITION. NOW THE ASSESSEE IS IN APPEAL. 5. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE LD. CIT(A) HAD NOT GIVEN PROPER OPPORTUNITY OF BEING HEARD AND ALSO HAD NOT CONSIDERED THE SUBMISSIONS OF THE ASSESSEE. IT WAS FURTHER SUBMITTED THAT 3 IF THERE WAS ANY INTENTION OF LD. CIT(A) TO ENHANC E THE ADDITION, THE NOTICE SHOULD HAVE BEEN GIVEN TO THE ASSESSEE AND T HE OPPORTUNITY WAS ALSO REQUIRED TO BE GIVEN. 6. IN HIS RIVAL SUBMISSIONS, THE LD. SR. DR SUPPORT ED THE ORDERS OF THE AUTHORITIES BELOW. 7. I HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PA RTIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. IN T HE PRESENT CASE, IT IS NOTICED THAT THE ASSESSEE FURNISHED THE SUBMISSIO NS ON THE PROPOSED ENHANCEMENT WHICH HAS BEEN INCORPORATED BY THE LD. CIT(A) IN PARA 5 OF THE IMPUGNED ORDER. IT APPEARS THAT THE SAID SU BMISSIONS HAD NOT BEEN APPRECIATED IN RIGHT PERSPECTIVE BY THE LD. CI T(A) WHILE ENHANCING THE ADDITION. I, THEREFORE, DEEM IT APPROPRIATE TO SET ASIDE THIS CASE BACK TO THE FILE OF THE LD. CIT(A) TO BE ADJUDICATED AFR ESH IN ACCORDANCE WITH LAW AFTER PROVIDING DUE AND REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. (ORDER PRONOUNCED IN THE COURT ON 06.05.2019) SD/- (N.K. SAINI) VICE PRESIDENT DATED : 06. 05.2019 4 .. / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. / CIT 4. ( )/ THE CIT(A) 5. , ! , $ / DR, ITAT, JODHPUR 6. ' / GUARD FILE / BY ORDER / ASSISTANT REGISTRAR