Smt. Kamlesh Grover, New Delhi V. ITO, New Delhi

ITA 3193/DEL/2010

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 0094 (ITAT-DELHI)
• Duration Of Justice: 5 year(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-06-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 29-06-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 28-06-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GAURAV DUDEJA
• Keywords: Opportunity of being heard; Peak credit
• Section: 142(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D NEW DELHI BEFORE SHRI S.V. MEHROTRA : ACCOUNTANT MEMBER AND SHRI H.S. SIDHU: JUDICIAL MEMBER ITA NO. 3193/DEL/2010 ASSTT. YR: 2005-06 KAMLESH GROVER, VS. INCOME-TAX OFFICER, 131L, SHASTRI NAGAR, WARD 19(4), NEW DELHI. NEW DELHI. PAN: AMZPG 7064 P ( APPELLANT ) (RESPONDENT) APPELLANT BY : SHRI ASHOK KHANDELWAL CA RESPONDENT BY : SHRI GAURAV DUDEJA SR. DR DATE OF HEARING : 29/06/2015. DATE OF ORDER : 30/06/2015. O R D E R PER S.V. MEHROTRA, A.M: THIS APPEAL, PREFERRED BY THE ASSESSEE, IS DIREC TED AGAINST CIT(A)S ORDER DATED 19-04-2010 RELATING TO A.Y. 2005-06. EFFECTI VE GROUNDS RAISED ARE AS UNDER: 1. ACTION OF THE CIT(A) IN CONFIRMING THE ADDITION OF RS. 20,92,955/- AS INCOME FROM UNDISCLOSED SOURCE IS UN JUST, ILLEGAL, ARBITRARY AND AGAINST THE FACTS AND CIRCUM STANCES OF THE CASE. 2. ACTION OF THE CIT(A) IN WORKING OUT THE PEAK CR EDIT IN THE BANK ACCOUNTS OF THE APPELLANT OF RS. 42,78,373 /- ON 8-2- 2005 AND REDUCING THE SAME BY OPENING BALANCE IN TH E BANK ACCOUNTS OF RS. 21,85,418/- AND THUS ARRIVING AT TH E FIGURE OF RS. 2 20,92,955/- FOR THE PURPOSES OF ADDITION WITHOUT TH E CONSIDERING THE PEAK CREDIT IN THE BANK ACCOUNT ON 23-10-2003 T RS. 42,28,625/- IS UNJUST, ILLEGAL, ARBITRARY AND AGAIN ST THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. ACTION OF THE CIT(A) IN CONFIRMING THE ADDITION OF THE AO IN PASSING THE ORDER WITHOUT GIVING SUFFICIENT A ND REASONABLE OPPORTUNITY OF BEING HEARD IS ILLEGAL, A RBITRARY AND AGAINST THE FACTS AND CIRCUMSTANCES OF THE CASE. 4. THAT THE NOTICE OF HEARING DT. 18-9-2007 U/S 142 (1) OF THE IT ACT, 1961 FOR 8-10-2007 WAS NOT SERVED ON THE AP PELLANT AND NO NOTICE U/S 142(1) OF THE ACT DATED 22-11-2007 IS SUED ON 26- 11-2007 FOR 3-12-2007 WAS RECEIVED BY THE APPELLANT AND IN ABSENCE OF SERVICE OF SUCH NOTICE ON THE APPELLANT NO VALID ASSESSMENT COULD BE MADE. 2. FACTS, IN BRIEF, ARE THAT THE AO PASSED THE ORD ER U/S 144/142(1) ON 24- 12-2007 AS THE ASSESSEE DID NOT RESPOND TO THE NOTI CES DATED 19-9-2007 AND 26-11-2007. THE AO ON THE BASIS OF AIR INFORMATION MADE ADDITION OF RS. 74 LACS BEING THE CASH DEPOSIT IN CANARA BANK ACCOU NTS. HE NOTICED THAT ASSESSEE HAD MAINTAINED TWO ACCOUNTS BEING SB A/C N OS. 16591 AND 1011 WITH CANARA BANK, DELHI. AFTER EXAMINING THE BANK A CCOUNTS, HE NOTICED THAT IN SB A/C NO. 16591 THE OPENING BALANCE AS ON 31-3-2004 WAS RS. 21,85,418/- AND, THEREAFTER, UP TO 31-3-2005, RS. 4 1 LACS WERE DEPOSITED AS AGAINST THE TOTAL WITHDRAWALS OF RS. 63,50,000/- (R S. 67,50,000/- MINUS RS. 4,00,000/-, BEING WITHDRAWAL ON 9-2-2004). SIMILARL Y, IN SB A/C NO. 1011 THE AO NOTICED THAT THERE WERE DEPOSITS OF RS. 33 L ACS AS AGAINST THE WITHDRAWALS OF RS. 22,50,000/-. THE ASSESSEE HAD C LAIMED THAT THE DEPOSITS 3 IN THE BANK ACCOUNT IN CASH WERE OUT OF OWN CAPITAL , EARNING OF THE YEAR AND OUT OF EARLIER WITHDRAWALS MADE IN CASH FROM THE SA ME ACCOUNT OR IN OTHER ACCOUNT. 3. LD. CIT(A) DID NOT ACCEPT THE ASSESSEES CONTEN TION REGARDING OWN CAPITAL AND EARNING OF THE YEAR AS THEY WERE QUITE MEAGER. HE DETERMINED THE PEAK CREDIT IN ORDER TO ASCERTAIN THE MAXIMUM AMOU NT OF CASH AVAILABLE WITH THE ASSESSEE AT ANY POINT OF TIME AND ACCORDIN GLY FOUND THAT ON 8-2- 2005, THE MAXIMUM BALANCE WAS RS. 42,78,373/- (RS. 20,27,417/- IN SB A/C NO. 1011 AND RS. 20,50,956/- IN SB A/C NO. 16591). THIS BALANCE WAS ASCERTAINED AFTER GIVING LIVERAGE THAT THE AMOUNT WITHDRAWN FROM THE ACCOUNT WAS REDEPOSITED IN THE SAME ACCOUNT OR TH E SECOND ACCOUNT. FROM THIS HE REDUCED OPENING BALANCE OF RS. 21,58,418/- AND CONFIRMED THE ADDITION OF RS. 20,92,955/-. 4. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT PEAK CREDIT HAS NOT CORRECTLY BEEN DETERMINED. 5. LD. DR SUBMITTED THAT NO DETAILS WERE FURNISHED BEFORE THE AO AND, THEREFORE, THE MATTER MAY BE RESTORED BACK TO THE F ILE OF AO FOR PROPER ADJUDICATION. 6. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. KEEPING IN VIEW THE FACT THAT RELEVANT DETAILS WERE NOT 4 FILED BEFORE THE AO, TO BE FAIR TO BOTH THE PARTIES AND IN THE INTEREST OF SUBSTANTIAL JUSTICE WE RESTORE THE MATTER TO THE F ILE OF AO FOR FRESH ADJUDICATION, IN ACCORDANCE WITH LAW, AFTER AFFORDI NG REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 7. IN THE RESULT, REVENUES APPEAL STANDS ALLOWED F OR STATISTICAL PURPOSES ONLY. ORDER PRONOUNCED IN OPEN COURT ON 30, 06,2015. SD/- SD/- (H.S. SIDHU) ( S.V. MEHROTRA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 30-06-2015. MP COPY TO : 1. ASSESSEE 2. AO 3. CIT(A) 4. CIT 5. DR (ITAT)