The ITO, Ward-12(3), Ahmedabad V. Shri Vipul Hasmukhbhai Dave, Ahmedabad

ITA 3212/AHD/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 6559 (ITAT-AHMEDABAD)
• Duration Of Justice: 6 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-06-2011
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 03-12-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SAMIR TEKRIWA LA
• Keywords: Opportunity of being heard; Additional evidence

Judgement Text

ITA NO.3212/AHD /2010 . ASSESSMENT YEAR 2007-08. 1 IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH,AHM EDABAD. ( BEFORE SHRI BHAVNESH SAINI & SHRI D.C. AGRAWAL) I.T.A. NO.3212/AHD/2010 (ASSESSMENT YEAR 2007-08) INCOME TAX OFFICER, WARD 12(3), ROOM NO.104, NARAYAN CHAMBERS, ASHRAM ROAD, AHMEDABAD. (APPELLANT) VS. SHRI VIPUL HASMUKHBHAI DAVE, LALBHAI CHHAVABHAI CHALI, NARAYAN KUNJ, BEHIND POST OFFICE KHOKHARA, AHMEDABAD. (RESPONDENT) PAN: AISPD 3518 L APPELLANT BY : SHRI SAMIR TEKRIWALA, SR. D. R. RESPONDENT BY : NONE. ( (( ( )/ )/)/ )/ ORDER PER: SHRI BHAVNESH SAINI, J.M. THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LD. C.I.T. (A)-XX, AHMEDABAD DATED 20-9-2010 FOR ASSESSMENT YE AR 2007-08 ON THE FOLLOWING GROUNDS:- 1. THE LD. CIT(A)-XX, AHMEDABAD HAS ERRED IN LAW AN D ON FACTS IN TREATING THE CASH CREDITS OF RS.15,00,600/- AS E XPLAINED ON THE GROUND THAT THESE AMOUNTS WERE DEPOSITED IN THE BAN K ON DIFFERENT DATES WHEN THE ASSESSEE HAD SUFFICIENT CA SH BALANCE,. AND THAT, THE TOTAL CASH SALES DURING THE YEAR WAS TO THE EXTENT OF RS.15,74,412/-. ITA NO.3212/AHD /2010 . ASSESSMENT YEAR 2007-08. 2 1.2. IN DOING SO, THE LD. CIT (A) XX, AHMEDABAD 1 HAS FURTHER ERRED IN LAW AND ON FACTS IN RELYING ON CERTAIN DOC UMENTS FILED WHICH ALLEGEDLY ESTABLISHED THE SOURCE OF THE AFORE SAID CREDITS. THE CIT(A) HAS FAILED TO TAKE INTO CONSIDERATION TH E FACT THAT THE ASSESSEE HAD FAILED TO APPEAR BEFORE THE ASSESS ING OFFICER IN REMAND PROCEEDINGS. IT WAS NOT JUSTIFIABLE THERE FORE, FOR THE CIT (A) TO DELETE THE ADDITION WITHOUT CO-RELATING THE CASH DEPOSITS IN THE BANK ACCOUNT WITH THE CASH SALES. T HERE IS ALSO NO MERIT IN PLACING RELIANCE ON THE FACT THAT THE C ASH WAS DEPOSITED ON DIFFERENT DATES, AND THAT, THE CASH SA LES OF THE ASSESSEE WAS ALMOST THE SAME AS THE CASH DEPOSITED. WITHOUT ESTABLISHING ANY CO-RELATION BETWEEN THE EARNINGS A ND THE DEPOSITS, AND WITHOUT EXAMINING THE FACTS OF THE CA SE AS BROUGHT ON RECORD BY THE ASSESSING OFFICER IN HIS REMAND RE PORT, THE CIT (A) IS SIMPLY NOT JUSTIFIED IN DELETING THE ADD ITION. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT (A) OUGHT TO HAVE UPHELD THE ORDER OF THE A.O. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT AO ISSUE D SEVERAL STATUTORY NOTICES TO THE ASSESSEE FOR COMPLETION OF THE ASSES SMENT BUT THE ASSESSEE DID NOT COMPLY WITH THESE STATUTORY NOTICES AND FAILED TO ATTEND THE ASSESSMENT PROCEEDINGS, THEREFORE, A.O. PASSED EX-PARTE ASSESS MENT ORDER U/S. 144 OF THE ACT, BECAUSE OF THE NON CO-OPERATION OF THE ASSESSE E. IT WAS SEEN FROM THE ASSESSMENT ORDER THAT ASSESSEE HAD MADE CASH DEPOSI TS OF RS. 15,00,600/- IN SAVINGS BANK ACCOUNT WITH HDFC BANK LTD., SARANGPUR GATE, AHMEDABAD. SINCE NO EXPLANATION REGARDING THESE CASH DEPOSITS WAS OFFERED TO THE A.O., ASSESSING OFFICER PROCEEDED TO MAKE ADDITION U/S. 6 9C OF THE ACT. THE ASSESSEE CHALLENGED THE ADDITION BEFORE THE LD. CIT (A) AND SUBMITTED ADDITIONAL EVIDENCES IN THE FORM OF COPY OF STATEME NT OF HDFC BANK, COPY OF HDFC BANK ACCOUNT FROM THE BOOKS OF THE ASSESSEE , CASH IN HAND ACCOUNT, CASH SALE ACCOUNT AND PURCHASE REGISTER. THESE DOCUMENTS WERE ITA NO.3212/AHD /2010 . ASSESSMENT YEAR 2007-08. 3 SENT TO THE A.O. FOR REMAND REPORT AFTER EXAMINING THE CONTENTION OF THE ASSESSEE. THE A.O. STATED IN HIS REMAND REPORT THAT ASSESSEE HAS NOT FILED ANY DETAILS DESPITE BEING GIVEN SUFFICIENT OPPORTUNITIE S OTHER THAN SAVING BANK ACCOUNT WITH HDFC BANK LTD. THE LD. CIT(A) DID NOT ACCEPT THE CONTENTION OF THE A.O. BECAUSE THE ABOVE ADDITIONAL EVIDENCES WERE FORWARDED TO THE A.O. FOR HIS COMMENTS. IN VIEW OF THE FACT THAT THE DEPOSITS ARE MADE ON SEVERAL DATES AND NOT ON A SINGLE DAY A ND ON THESE DATES ASSESSEE WAS FOUND TO HAVE SUFFICIENT FUNDS, LD. CI T (A) NOTED THAT NO ADDITION COULD HAVE BEEN MADE BY THE A.O. LD. CIT( A) ALSO FOUND FROM THE CASH SALES ACCOUNT THAT TOTAL CASH SALES OF THE ASS ESSEE ARE OF RS.15,74, 412/-. THUS THE DEPOSITS MADE IN THE BANK ACCOUNT ARE LESS THAN THE CASH SALES OF THE ASSESSEE. THE LD. CIT (A) THEREFORE, OBSERVED T HAT A.O. WAS NOT JUSTIFIED IN STATING THAT DEPOSITS MADE IN THE BANK ACCOUNT B Y THE ASSESSEE HAVE NOT BEEN EXPLAINED. THE ADDITION WAS ACCORDINGLY DELETE D. 3. THE LD. D.R. RELIED UPON THE ORDER OF THE ASSESS ING OFFICER AND ALSO RELIED UPON THE GROUNDS OF APPEAL. THE LD. D.R. SU BMITTED THAT ASSESSEE FAILED TO APPEAR BEFORE THE A.O. AND NO EVIDENCES H AVE BEEN FILED. THE LD. D.R. FURTHER SUBMITTED THAT THE CASH SALES AND THE CASH DEPOSITS ARE ALMOST OF THE SAME AMOUNT AND ASSESSEE FAILED TO EXPLAIN THE EXPENSES INCURRED FOR BUSINESS PURPOSES AS WELL AS THE WITHDRAWALS SHOWN. THEREFORE, THERE IS NO POSSIBILITY TO MAKE CASH DEPOSIT IN THE BANK ACCOUN T OUT OF THE TOTAL CASH SALES. LD. D.R. THEREFORE, SUBMITTED THAT LET THE M ATTER BE VERIFIED AT THE LEVEL OF THE CIT (A) BY GIVING OPPORTUNITY TO THE A.O. 4. THE NOTICE OF HEARING WAS SERVED UPON THE ASSESS EE THROUGH REGISTERED POST ACKNOWLEDGEMENT IS PLACED ON RECORD. HOWEVER, NONE APPEARED ON ITA NO.3212/AHD /2010 . ASSESSMENT YEAR 2007-08. 4 BEHALF OF THE ASSESSEE DESPITE THE SERVICE OF NOTIC E. THEREFORE, THE APPEAL IS DECIDED EX-PARTE QUA THE ASSESSEE. 5. ON CONSIDERATION OF THE FACTS OF THE CASE IN THE LIGHT OF THE SUBMISSION OF THE LD. D.R. WE ARE OF THE VIEW THAT THE MATTER REQUIRES RE-CONSIDERATION AT THE LEVEL OF THE CIT (A). IT IS AN ADMITTED FACT THAT ASSESSEE DID NOT RESPOND TO ANY OF THE STATUTORY NOTICE BEFORE THE A .O. AND NO EXPLANATION OR MATERIAL IS FILED TO EXPLAIN THE ABOVE ISSUE. THE A SSESSEE REMAINED NON CO- OPERATIVE AT THE ASSESSMENT STAGE BEFORE THE A.O. IN THE ABSENCE OF ANY EXPLANATION FROM THE SIDE OF THE ASSESSEE A.O. PASS ED EX-PARTE ASSESSMENT ORDER. HOWEVER, AT THE APPELLATE STAGE ASSESSEE FI LED DOCUMENTS BY WAY OF ADDITIONAL EVIDENCES WHICH WERE FORWARDED TO THE A. O. FOR FILING THE REMAND REPORT. BUT THE IMPUGNED ORDER OF THE LD. CIT (A) R EVEALED THAT THE LD. CIT (A) DID NOT PASS ANY ORDER IN WRITING AS PER RULE 4 6A (2) OF THE INCOME TAX RULES FOR ADMISSION OF THE ADDITIONAL EVIDENCES. NO REASONS ARE ALSO RECORDED AS TO WHAT PREVENTED THE ASSESSEE FROM PRO DUCING SUCH ADDITIONAL EVIDENCES BEFORE THE A.O. THE ASSESSEE SHALL HAVE TO MEET THE REQUIREMENTS OF RULE 46A BEFORE ADMISSION OF THE ADDITIONAL EVID ENCES AT THE APPELLATE STAGE BEFORE THE CIT (A) OTHERWISE SUCH ADDITIONAL EVIDENCES COULD NOT HAVE BEEN ADMITTED AT THE APPELLATE STAGE. FURTHER, LD. D.R. RIGHTLY CONTENDED THAT THE AMOUNT OF THE CASH SALES ALLEGEDLY SHOWN BY THE ASSESSEE BEFORE THE CIT (A) IS ALMOST OF THE SAME AMOUNT AS COMPARED WITH T HE CASH DEPOSIT IN THE BANK ACCOUNT OF THE ASSESSEE. THE ASSESSEE SHALL HA VE TO EXPLAIN AS TO FROM WHERE OTHER EXPENSES WERE INCURRED AND FROM WHERE A SSESSEE HAS MADE WITHDRAWALS FOR HOUSEHOLD PURPOSES. THE LD. CIT (A ) HAS ALSO NOT GIVEN ANY FINDING WHETHER ASSESSEE HAS BEEN ABLE TO CO-RE LATE THE CASH SALES WITH THE CASH DEPOSITS. THE LD. CIT (A) MERELY ACCEPTED THE ADDITIONAL EVIDENCES ITA NO.3212/AHD /2010 . ASSESSMENT YEAR 2007-08. 5 FILED BY THE ASSESSEE BEFORE HIM FOR THE FIRST TIME WITHOUT VERIFYING THE SAME. IN THE ABSENCE OF ANY SPECIFIC REASONS FOR DECISION AND IN ABSENCE OF ANY GIVING MEANINGFUL OPPORTUNITY TO THE A.O. AS PER RU LE 46A OF THE I.T. RULES AND IN THE ABSENCE OF ANY SPECIFIC ORDER UNDER RULE 46A BY THE LD. CIT (A) WE ARE OF THE VIEW THAT LD. CIT (A) WAS NOT JUSTIFI ED IN DELETING THE ADDITION. CONSIDERING THE FACTS OF THE CASE WE ARE OF THE VIE W THAT MATTER REQUIRES RE- CONSIDERATION AT THE LEVEL OF THE CIT (A). WE ACCOR DINGLY SET ASIDE THE ORDER OF THE LD. CIT (A) AND RESTORE THIS ISSUE TO THE FI LE OF CIT(A) WITH DIRECTION TO RE-DECIDE THIS ISSUE BY GIVING REASONABLE AND SU FFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AS WELL AS A.O. THE LD . CIT (A) SHALL TAKE INTO CONSIDERATION THE CONDITIONS OF RULE 46A BEFORE PAS SING THE APPELLATE ORDER AND SHALL PASS REASONED ORDER ON EACH AND EVERY ASP ECT OF THE MATTER CONSIDERING THE SUBMISSIONS OF BOTH THE PARTIES. 6. IN THE RESULT DEPARTMENTAL APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 7 - 06- 2011. SD/- SD/- (D. C. AGRAWAL) (BHAVNESH SAINI) ACCOUNTANT MEMBER J UDICIAL MEMBER AHMEDABAD. DATED: 7-06- 2011. S.A.PATKI. LK ITA NO.3212/AHD /2010 . ASSESSMENT YEAR 2007-08. 6 COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS)- 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHMEDABAD. 1.DATE OF DICTATION 3 - 6 -2011 2.DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE TH E DICTATING 6 / 6 / 2011 MEMBER.OTHER MEMBER. 3.DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S - -2011. 4.DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT - -2011 5.DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR .P.S./P.S - -2011 6.DATE ON WHICH THE FILE GOES TO THE BENCH CLERK - -2011. 7.DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8.THE DATE ON WHICH THE FILE GOES TO THE ASSTT. REG ISTRAR FOR SIGNATURE ON THE ORDER 9.DATE OF DESPATCH OF THE ORDER..