Sanjiv Dutta, New Delhi V. ITO, Ward-31(3), New Delhi

ITA 3168/DEL/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 2703 (ITAT-DELHI)
• Duration Of Justice: 11 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-03-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 11-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D S YADAV
• Assessee Lawyers: MANU K GIRI
• Keywords: Opportunity of being heard
• Section: 201; 13

Judgement Text

IN TH E INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : SMC - 2 : NEW DELHI BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBER ITA NO. 3 1 68 /DEL/201 9 ASSESSMENT YEAR: 20 1 1 - 12 SANJIV DUTTA, DD - 232, WESTERN MARG, SAIDULAJAB, MB ROAD, MEHRAULI, NEW DELHI. PAN: A EOPD1198N VS ITO, WARD - 31(3), NEW DELHI. (APP ELL A NT ) (RESPONDENT) A SSESSEE BY : SHRI MANU K. GIRI, ADVOCATE RE VENUE BY : SHRI D.S. YADAV, SR. DR DATE OF HEARING : 0 5 .0 3 . 20 20 DATE OF PRONOUNCEMENT : 13 .03. 20 20 ORDER TH IS APPEAL F ILED BY THE ASSESSE E IS DIRECTED AGAINST THE ORDER DATED 25 TH FEBRUARY, 2019 OF THE CIT(A) - 1 1 , NEW DELHI , RELATING TO THE A.Y. 201 1 - 12 . 2. ALTHOUGH A NUMBER OF GROUNDS HAVE BEEN RAISED BY THE ASSESSEE, THESE ALL RELATE TO THE ORDER O F THE CIT(A) IN SUSTAINING THE ADDITION OF RS.37,63,336/ - MADE ON ACCOUNT OF DISALLOWANCE OF PURCHASE OF RS.34,58,139/ - AND DISALLOWANCE OF EXPENSES OF RS.3,04,197/ - . 3. F ACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND IS RUNNING A PROPRIETARY CONCERN IN HIS OWN NAME AND ALSO DERIVES INCOME FROM ITA NO. 3 1 68 /DEL/201 9 2 OTHER SOURCES. HE FILED HIS RETURN OF INCOME ON 30 TH SEPTEMBER, 2011 DECLARING A TAXABLE INCOME OF RS.6,50,860/ - . THE AO, DURING THE COURSE OF ASSESSMENT PROCEEDINGS, NOTED THAT THE ASSES SEE HAS DEBITED AN AMOUNT OF RS.3,45,81,398/ - ON ACCOUNT OF PURCHASES. SINCE THE ASSESSEE DID NOT PRODUCE THE PURCHASE BILLS DESPITE A NUMBER OF OPPORTUNITIES GRANTED BY HIM, THE AO DISALLOWED AN AMOUNT OF RS.34,58,139/ - BEING 10% OF SUCH PURCHASES. SIMI LARLY, IN ABSENCE OF PRODUCTION OF BILLS AND VOUCHERS RELATING TO THE VARIOUS EXPENSES CLAIMED IN THE P&L ACCOUNT TOTALLNG TO RS.6,08,395/ - THE AO DISALLOWED AN AMOUNT OF RS.3,04,197/ - BEING 50% OF SUCH EXPENSES. IN APPEAL, THE LD.CIT(A) SUSTAINED THE AD DITIONS MADE BY THE AO. 4 . AGGRIEVED WITH SUCH ORDER OF THE CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 5 . THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE S BUSINESS WAS CONSTANTLY DECLINING AND SUBSEQUENTLY, THE PREMISES OF THE ASSESSEE WAS SEALED BY THE DRT. THEREFORE, THE ASSESSEE WAS NOT IN A POSITION TO PRODUCE THE DETAILS BEFORE THE LD.CIT(A). HE SUBMITTED THAT IN THE MEAN TIME, THE DR T HAS LIFTED THE PROHIBITORY ORDERS AND GIVEN AN OPPORTUNITY, THE ASSESSEE WILL PRODUCE T HE DETAILS OF PURCHASES AND OTHER DETAILS BEFORE THE AO TO SUBSTANTIATE ITS CASE. HE FURTHER SUBMITTED THAT THE DISALLOWANCE OF 10% OF THE PURCHASES AND DISALLOWANCE OF 50 % OF THE EXPENSES ARE ALSO ON THE HIGHER SIDE. HE ACCORDINGLY SUBMITTED THAT IN THE ITA NO. 3 1 68 /DEL/201 9 3 INTEREST OF JUSTICE, THE ASSESSEE SHOULD BE GIVEN ONE FINAL OPPORTUNITY TO SUBSTANTIATE ITS CASE. 6 . THE LD. DR, ON THE OTHER HAND, HEAVILY RELIED ON THE ORDERS OF THE AO AND THE CIT(A) AND SUBMITTED THAT DESPITE NUMBER OF OPPORTUNITIES GRANTED BY THE AO AND THE CIT(A), THE ASSESSEE DID NOT PRODUCE THE DETAILS FOR WHICH THE AO MADE THE ADDITION WHICH WAS SUSTAINED BY THE CIT(A). HE ACCORDINGLY SUBMITTED THAT THE ORDER OF THE CIT(A) BE UPHELD. 7 . I HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SID ES AND PERUSED THE RECORD. IT IS AN ADMITTED FACT THAT DUE TO NON - PRODUCTION OF DETAILS OF PURCHASE BILLS AND VOUCHERS, THE AO DISALLOWED 10% OF THE PURCHASES AMOUNTING TO RS.34,58,139/ - . SIMILARLY, DUE TO NON - PRODUCTION OF DETAILS OF EXPENSES, THE AO DI SALLOWED 50% OF SUCH EXPENSES AMOUNTING TO RS.3,04,197/ - . I FIND, IN APPEAL, THE LD.CIT(A) SUSTAINED THE ADDITION MADE BY THE AO SINCE NOTHING MORE WAS PRODUCED BEFORE HIM TO SUBSTANTIATE THE SAME. IT IS THE SUBMISSION OF THE LD. COUNSEL THAT DUE TO THE ORDERS OF THE DRT, THE PREMISES OF THE ASSESSEE WAS SEALED AND HE WAS NOT IN A POSITION TO PRODUCE ANY DOCUMENT BEFORE THE CIT(A). IT IS ALSO HIS SUBMISSION THAT THE DISALLOWANCE OF SUCH HUGE AMOUNT BY THE AO WHICH HAS BEEN SUSTAINED BY THE CIT(A) IS ON T HE HIGHER SIDE. C ONSIDERING THE TOTALITY OF THE FACTS OF THE CASE AND IN THE INTEREST OF JUSTICE, I DEEM IT PROPER TO RESTORE THE ISSUE TO THE FILE OF THE AO WITH A DIRECTION TO GIVE ONE FINAL OPPORTUNITY TO THE ASSESSEE TO SUBSTANTIATE ITS CASE BY PRODUC ING DETAILS OF PURCHASES AND VARIOUS EXPENSES ITA NO. 3 1 68 /DEL/201 9 4 DEBITED IN PROFIT & LOSS ACCOUNT WITH BILLS AND VOUCHERS TO THE SATISFACTION OF THE AO. THE AO SHALL DECIDED THE ISSUE AS PER FACT AND LAW AFTER GIVING DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. I HOLD A ND DIRECT ACCORDINGLY. THE GROUNDS RAISED BY THE ASSESSEE ARE ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES. 8 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. THE DECISION WAS PRONOUNCED IN THE OPEN COURT ON 13 . 0 3 . 20 20 . SD / - ( R. K. PANDA ) ACCOUNTANT MEMBER DATED: 13 TH MARCH, 2020. DK COPY FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASSTT. REGISTRAR, ITAT, NEW DELHI