ITO, New Delhi V. Smt. Renu Sharma, New Delhi

ITA 3252/DEL/2011

• Counselvise Citation: 325220114 RSA 2011
• Duration Of Justice: 9 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-03-2012
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 06-03-2012
• Assessment Year: 2008-2009
• Appeal Filed On: 16-06-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: VIRENDRA PRATAP
• Keywords: Business income; Additional evidence
• Section: 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH F NEW DELHI) BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI T.S. KAPOOR, ACCOUNTANT MEMBER I.T.A. NO.3252/DEL/2011 ASSESSMENT YEAR : 2008-09 ITO, SMT RENU SHARMA, WARD-44 (1), 80-BANARSI DASS ESTATE, NEW DELHI. V. TIMARPUR, NEW DELHI. (APPELLANT) (RESPONDENT) PAN /GIR/NO. PAN /GIR/NO. PAN /GIR/NO. PAN /GIR/NO.ABCPS ABCPS ABCPS ABCPS- -- -4197 4197 4197 4197- -- -D DD D APPELLANT BY : SHRI PRADEEP KUMAR, CIT-DR. RESPONDENT BY : SHRI VIRENDRA PRATAP, C.A. ORDER PER KAPOOR, AM: THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORD ER OF LD CIT(A)- XXX, NEW DELHI DATED 20.4.2011 FOR ASSESSMENT YEAR 200 8-09. THE GROUNDS OF APPEAL ARE AS UNDER;- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND LAW, THE CIT(A) XXX, NEW DELHI HAS ERRED IN DELETING THE ADDITION OF `.16,29,500/- ON ACCOUNT OF CASH DEPOSITS OUT OF UNDIS CLOSED SOURCES MADE BY THE ASSESSING OFFICER. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD CIT(A)- XXX, NEW DELHI HAS ERRED IN ADMITTING ADDITIONAL EVI DENCE IN CONTRAVENTION OF RULE 46A OF THE IT RULES. ITA NO3252/DEL/2011 2 3. THE APPELLANT CRAVES THE RIGHT TO ALTER, AMEND ADD O R SUBSTITUTE THE GROUNDS OF APPEAL. 2. THE ASSESSEE SMT. RENU SHARMA IS AN EMPLOYEE OF AIR I NDIA AND IS WORKING AS EXECUTIVE SECRETARY. HER HUSBAND MR. DEE PAK SHARMA IS A BUSINESS MAN. THEY WERE MAINTAINING JOINT ACCOUNT W ITH PUNJAB NATIONAL BANK HAVING A/C NO. 0650000101052558, MODE L TOWN, DELHI . THE ACCOUNT WAS MOSTLY OPERATED BY MR. DEEPAK SHARMA IN WHICH THERE WERE CASH DEPOSITS AND CASH WITHDRAWALS. THE CASH DEPOSIT WAS FROM WITHIN DELHI AND OUTSIDE DELHI RANGING FROM SRI NAGAR, MADHYA PRADESH, BIHAR ETC. THE ASSESSING OFFICER DURING THE ASSESSM ENT PROCEEDINGS ADDED BACK THE DEPOSIT IN THE ACCOUNT AS U NEXPLAINED INCOME U/S 69 OF THE INCOME TAX ACT, 1961. THE ASSESSEE WENT IN FOR APPEAL AND PLEADED THAT MONEY DID NOT BELONG TO HER AND RATHER IT WAS DEPOSITED BY CUSTOMERS OF HER HUSBAND WHO WAS DOING BUSIN ESS OF LPG STOVES AND COOKER PARTS. IN SUPPORT, THE ASSESSEE ALSO FIL ED AN AFFIDAVIT OF HER HUSBAND IN WHICH HE HAD ADMITTED T HAT TRANSACTIONS BELONG TO HIM HAS EXPLAINED THE SOURCE TO BE PART OF HIS BUSINESS RECEIPTS. 3. THE LD CIT(A) DELETED THE ADDITION ON THE FOLLO WING GROUNDS:- A) SMT. RENU SHARMA CANNOT BE PRESUMED TO VISIT VARIO US PLACES TO DEPOSIT CASH AS SHE WAS IN FULL TIME EMPLOYMENT WITH AIR INDIA LTD. B) THE ACCOUNT IS JOINTLY HELD BY SMT. RENU SHARMA A ND SHRI DEEPAK SHARMA. ITA NO3252/DEL/2011 3 C) THERE IS NO EVIDENCE THAT THE MONEY BELONG TO THE APPELLANT. AS THE SB A/C IS OPERATED BY HUSBAND OF ASSESSEE FOR HIS BUSINESS, THE OTHER PEOPLE/CUSTOMRS AT OTHER PLACES DEPOSI T CASH IN ASSESSEES SB A/C. D) SHRI DEEPAK SHARMA HIMSELF HAS AFFIRMED THROUGH AF FIDAVIT THE SOURCE OF DEPOSIT AND AS PER HIS INCOME TAX RETURN IT I S WELL ESTABLISHED THAT SHRI DEEPAK SHARMA HIMSELF HAS DISCLOSED PROFIT TO THE EXTENT OF `.2,25,936.87 WHICH IS MUCH MORE TH AN 5% OF THE TOTAL DEPOSIT OF `.16,29,500/- U/S 44AF OF THE IT ACT, 1961. THE ASSESSEE CAN ESTIMATE HIS INCOME @ 5% OF T.O. TO THE EXTENT OF `.40 LAKHS AND NEED NOT MAINTAIN ANY BOOKS OF ACCO UNTS. IN THE PRESENT CASE, SHRI DEEPAK SHARMA HAD SHOWN NET OF 2.25.937 X 100 = 13.86% WHICH IS MORE THAN STATUTORY LIMIT OF 5%. 4. AGGRIEVED BY THE SAID ORDER OF LD CIT(A), THE DE PARTMENT HAS PREFERRED APPEAL BEFORE THE TRIBUNAL. 5. WE HAVE CONSIDERED THE FACTS OF THE CASE AND ALSO S UBMISSIONS OF THE LD REPRESENTATIVES AND GONE THROUGH THE RECORD . WE FIND THAT WHILE DELETING THE ADDITION, THE LD CIT(A) HAS VIOLA TED CLAUSE (III) OF RULE 46A. RULE 46A HAS A DIRECT BEARING ON THE CONT ROVERSY, THEREFORE, IT IS SALUTARY UPON US TO TAKE NOTE OF THIS RULE. IT RE ADS AS UNDER:- (1) THE APPELLANT SHALL NOT BE ENTITLED TO PRODUCE BE FORE THE DEPUTY COMMISSIONER (APPEALS) OR, AS THE CASE MAY BE, THE COMMISSIONER (APPEALS)], ANY EVIDENCE, WHETHER ORAL OR DOCUMENTARY, OTHER THAN THE EVIDENCE PRODUCED BY HIM DURING ITA NO3252/DEL/2011 4 THE COURSE OF PROCEEDINGS BEFORE THE ASSESSING OFFICER EXCEP T IN THE FOLLOWING CIRCUMSTANCES, NAMELY: (A) WHERE THE ASSESSING OFFICER HAS REFUSED TO ADMIT EVID ENCE WHICH OUGHT TO HAVE BEEN ADMITTED; OR (B) WHERE THE APPELLANT WAS PREVENTED BY SUFFICIENT CAU SE FROM PRODUCING THE EVIDENCE WHICH HE WAS CALLED UPON TO PROD UCE BY THE ASSESSING OFFICER OR (C) WHERE THE APPELLANT WAS PREVENTED BY SUFFICIENT CAU SE FROM PRODUCING BEFORE THE ASSESSING OFFICER ANY EVIDENCE WHICH IS RELEVANT TO ANY GROUND OF APPEAL; OR (D) WHERE THE ASSESSING OFFICER HAS MADE THE ORDER APPEAL ED AGAINST WITHOUT GIVING SUFFICIENT OPPORTUNITY TO THE APPELLANT TO ADDUCE EVIDENCE RELEVANT TO ANY GROUND OF APPEAL. (2) NO EVIDENCE SHALL BE ADMITTED UNDER SUB-RULE (1) U NLESS THE DEPUTY COMMISSIONER (APPEALS) OR, AS THE CASE MAY BE, THE COMMISSIONER (APPEALS)] RECORDS IN WRITING THE REASONS FOR ITS ADMISSION. (3) THE DEPUTY COMMISSIONER (APPEALS) OR, AS THE CASE M AY BE, THE COMMISSIONER (APPEALS)] SHALL NOT TAKE INTO ACCOUNT ANY EVIDENCE PRODUCED UNDER SUB-RULE (1) UNLESS THE ASSESSING OFFICER HAS BEEN ALLOWED A REASONABLE OPPORTUNITY ITA NO3252/DEL/2011 5 (A) TO EXAMINE THE EVIDENCE OR DOCUMENT OR TO CROSS-EXA MINE THE WITNESS PRODUCED BY THE APPELLANT; OR (B) TO PRODUCE ANY EVIDENCE OR DOCUMENT OR ANY WITNESS IN REBUTTAL OF THE ADDITIONAL EVIDENCE PRODUCED BY THE A PPELLANT. 6. A BARE PERUSAL OF THIS RULE WOULD REVEAL THAT ASSESSEE SHALL NOT BE ENTITLED TO PRODUCE ANY EVIDENCE WHETHER ORAL OR DOCUMENTARY, OTHER THAN THE EVIDENCE PRODUCED BY HIM DURING THE ASSESSMENT PROCEEDINGS, UNLESS CONDITIONS ENUMERATED IN CLAUSE (A) TO (D) OF SUB RULE 1 ARE AVAILABLE. ACCORDING TO THESE CLAUSES, ADDI TIONAL EVIDENCE WOULD BE PERMITTED IF IT IS PROVED THAT THE ASSESSING O FFICER HAS REFUSED TO ADMIT THE ADDITIONAL EVIDENCE OR ASSESSEE WAS CALLED UPON TO PRODUCE A SPECIFIC EVIDENCE BY THE ASSESSING OFFICER BUT BY VIRTUE OF SUFFICIENT REASONS HE COULD NOT PRODUCE SUCH EVIDENCE O R ASSESSEE WAS TO PRODUCE ANY EVIDENCE RELEVANT TO THE GROUNDS OF APPEAL BUT HE COULD NOT PRODUCE IT BEFORE THE ASSESSING OFFICER OR A SSESSING OFFICER HAS PASSED THE ASSESSMENT ORDER WITHOUT GIVING SUFFICIENT OPPORTUNITY TO THE ASSESSEE. IF ANY ONE CONDITIONS IS AVAILABLE THEN ASSESSEE WOULD BE PERMITTED TO PRODUCE ADDITIONAL EVIDENCE. THE NE XT STEP SUGGESTED IN THE RULE IS THAT LD CIT(A) HAS TO RECORD REASONS FOR PERMITTING AN ASSESSEE TO PRODUCE THE ADDITIONAL EVIDENCE. AFTER THIS EXERCISE, IT HAS BEEN PROVIDED IN SUB RULE (3) THAT LD FIRST APPELLATE AUTHORITY SHALL NOT TAKE INTO ACCOUNT SUCH EVIDENCE UNLESS AN OPPORTUNITY TO REBUTT THE EVIDENCE WAS GIVEN TO THE ASSESSING OFFICER. ASSESSING OFFIC ER SHALL BE PROVIDED AN OPPORTUNITY TO EXAMINE THE DOCUMENT SUBM ITTED BY THE ASSESSEE AND HE WILL BE PROVIDED AN OPPORTUNITY TO ADDU CE EVIDENCE FOR REBUTTING THE EVIDENCE PRODUCED BY THE ASSESSEE. ITA NO3252/DEL/2011 6 7. IN THE PRESENT CASE, IT EMERGES OUT FROM THE ORDER OF THE LD CIT(A) THAT HE HAS NOT GIVEN ANY OPPORTUNITY TO THE ASSESSING OFFICER. IN VIEW OF THE ABOVE, WE ARE OF THE OPINION THAT TH E CASE SHOULD BE REMANDED BACK TO THE ASSESSING OFFICER FOR FRESH EXAMINA TION. THE ASSESSEE WILL BE AT LIBERTY TO PRODUCE ANY EVIDENCE OR EXPLANATION FOR EXPLAINING HERS POSITION WITH REGARD TO DEPOSITS IN HER BANK ACCOUNT. IT IS NEEDLESS TO SAY THAT THE OBSERVATIONS MADE BY US WILL N OT IMPAIR OR INJURE THE CASE OF ASSESSING OFFICER OR WOULD NOT CAUSE A NY PREJUDICE TO THE DEFENCE/EXPLANATION OF THE ASSESSEE. 8. IN THE RESULT, THE APPEAL OF THE REVENUE IS ALLOWE D FOR STATISTICAL PURPOSES. 9. ORDER PRONOUNCED IN THE OPEN COURT ON THE 16TH D AY OF MARCH, 2011. SD/- SD/- (RAJPAL YADAV) (T.S. KAPOO R) JUDICIAL MEMBER ACCOUNTANT MEMBER DT. 16.3.2012. HMS COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT (A)-, NEW DELHI. 5. THE DR, ITAT, LOKNAYAK BHAWAN, KHAN MARKET, NEW DEL HI. TRUE COPY. BY ORDER (ITAT, NEW DELHI). 1 ITA NO3252/DEL/2011 7