L Govindasamy, Chennai V. ACIT, Non Corporate Circle, Chennai

ITA 3260/CHNY/2018

• Counselvise Citation: [2019] 111 COUNSELVISE.COM (IT) 8810 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 1 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-12-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2014-2015
• Appeal Filed On: 29-11-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: N DEVANATHAN
• Keywords: Unexplained investment; Opportunity of being heard; Reasonable cause
• Section: 143(3)

Judgement Text

, , IN THE INCOME-TAX APPELLATE TRIBUNAL C BENCH, CHENNAI , . , BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER & SHRI DUVVURU RL REDDY, JUDICIAL MEMBER ./ I.T.A. NO. 3260/CHNY/2018 / ASSESSMENT YEAR: 2014-15 SHRI LINGAMANDRI GOVINDASAMY, NO. 8, RAJA GARDEN, PERAVALLUR, CHENNAI 600 082. [PAN:AIRPG0012F ] VS. THE ASSISTANT COMMISSIONER OF INCOME TAX, NON CORPORATE CIRCLE 10(1), CHENNAI 600 034. ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : SHRI N. DEVANATHAN, ADVOCATE / RESPONDENT BY : SHRI AR.V. SREENIVASAN, JCIT / DATE OF HEARING : 10.12.2019 /DATE OF PRONOUNCEMENT : 31.12.2019 / O R D E R PER DUVVURU RL REDDY, JUDICIAL MEMBER: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) 12, CHENNAI, DATED 31.10.2018 FOR THE ASSESSMENT YEAR 2014-15. THE ONLY EFFECTIVE GROUND RAISED IN THE APPEAL OF THE ASSESSEE RELATES TO CONFIRMATION OF ADDITION OF .1,21,10,000/-. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL, RUNNING A PROPRIETARY CONCERN IN THE NAME OF M/S. GOMATHI STEELS, WHICH IS ENGAGED IN THE TRADING BUSINESS OF STEEL. THE ASSESSEE FILED HIS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2014-15 ON 29.11.2014 ADMITTING AN INCOME OF I.T.A. NO.3260/CHNY/18 2 .66,85,940/-. THE ASSESSING OFFICER COMPLETED THE ASSESSMENT UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 [ACT IN SHORT] DETERMINING THE TOTAL INCOME AT .1,87,95,940/- BY MAKING ADDITION OF UNSECURED LOAN OF .1,21,10,000/-. ON APPEAL, SINCE THE ASSESSEE COULD NOT PRODUCE ANY DETAILS TO PROVE THAT THE CREDITS ARE GENUINE, THE LD. CIT(A) CONFIRMED THE ADDITION. 3. ON BEING AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. BY FILING VARIOUS DETAILS OBTAINED FROM THE DEBTORS, THE LD. COUNSEL FOR THE ASSESSEE HAS PRAYED FOR DELETING THE ADDITION. ON THE OTHER HAND, THE LD. DR SUBMITTED THAT THE ISSUE MAY BE REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER FOR VERIFICATION OF THE EVIDENCES FILED BEFORE THE TRIBUNAL AND DECIDE THE ISSUE IN ACCORDANCE WITH LAW. 4. WE HAVE HEARD BOTH THE SIDES, PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. IN THIS CASE, THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE HAS INTRODUCED A SUM OF .1,21,10,000/- AS CAPITAL IN THE BUSINESS. SINCE THE ASSESSEE COULD NOT PROVE THE CORRECTNESS OF THE LOAN CREDITORS, THE ASSESSING OFFICER TREATED THE SAME AS UNEXPLAINED INVESTMENTS AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. ON APPEAL, SINCE THE ASSESSEE COULD NOT PRODUCE ANY DETAILS TO PROVE THAT THE CREDITS ARE GENUINE, THE LD. CIT(A) CONFIRMED THE ADDITION. I.T.A. NO.3260/CHNY/18 3 HOWEVER, BEFORE US, THE ASSESSEE HAS FILED VARIOUS DETAILS OBTAINED FROM THE DEBTORS REGARDING THE RECEIPTS IN CASH DUE TO COMMERCIAL AND BUSINESS EXPEDIENCY DUE TO THE NATURE OF TRADE. SINCE THERE WAS REASONABLE CAUSE FOR THE DELAY IN FILING THE EVIDENCES BEFORE THE AUTHORITIES BELOW, WE DIRECT THE ASSESSING OFFICER TO EXAMINE THE DETAILS/EVIDENCES AS MAY BE FILED BY THE ASSESSEE AND DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH LAW AFTER AFFORDING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE ASSESSEE IS ALSO DIRECTED TO FURNISH COMPLETE DETAILS BEFORE THE ASSESSING OFFICER FOR ADJUDICATION OF THE ISSUE. THUS, THE GROUND RAISED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THE 31 ST DECEMBER, 2019 IN CHENNAI. SD/- SD/- (INTURI RAMA RAO) ACCOUNTANT MEMBER (DUVVURU RL REDDY) JUDICIAL MEMBER CHENNAI, DATED, 31.12.2019 VM/- /COPY TO: 1. / APPELLANT, 2. / RESPONDENT, 3. ( ) /CIT(A), 4. /CIT, 5. /DR & 6. /GF.