DCIT, New Delhi V. M/s. M.K.R. Construction Pvt. Ltd., Delhi

ITA 3351/DEL/2014

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 5491 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 11 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-05-2018
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 31-05-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 30-05-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SHEFALI SWAROOP
• Assessee Lawyers: S K GUPTA
• Keywords: Unexplained cash credit; Opportunity of being heard
• Section: 153A; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES E : DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI O.P. KANT, ACCOUNTANT MEMBER ITA.NO.3351/DEL./2014 ASSESSMENT YEAR 2008-2009 THE DCIT, CENTRAL CIRCLE - 03, ROOM NO.355, 3 RD FLOOR, JHANDEWALAN EXTENSION, NEW DELHI-055. VS M/S. MKR CONSTRUCTION PVT. LTD., 2042, KATRA TOBACCO, KHARI BAOLI, DELHI PIN-110 006.PAN AADCM6195J (APPELLANT) (RESPONDENT) FOR REVENUE : MS. SHEFALI SWAROOP, CIT-D.R. FOR ASSESSEE : SHRI S.K. GUPTA, C.A. DATE OF HEARING : 26.04.2018 DATE OF PRONOUNCEMENT : 08 .05 .2018 ORDER PER BHAVNESH SAINI, J.M. THIS APPEAL BY REVENUE HAS BEEN DIRECTED AGAINST TH E ORDER OF THE LD. CIT(A)-1, NEW DELHI, DATED 03 RD MARCH, 2014, FOR THE A.Y. 2008-2009, ON THE FOLLOWING GROUNDS : 1. THAT THE COMMISSIONER OF INCOME TAX (APPEALS) ERRE D IN LAW AND ON FACTS OF THE CASE IN DELETING THE ADDITION OF RS .1,61,04,949/- MADE BY AO ON ACCOUNT OF INCOME FROM UNDISCLOSED SO URCES U/S 68 OF I.T. ACT, 1961. 2 ITA.NO.3351/DEL./2014 M/S. MKR CONSTRUCTION (P) LTD., NEW DELHI. 2. THAT THE COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN LAW AND ON FACTS OF THE CASE IN DELETING THE ADDITI ON OF RS.1,04,949/- MADE BY AO ON ACCOUNT OF INTEREST PAI D ON TDS PAYABLE ON UNSECURED LOANS. 3. (A) THE ORDER OF THE CIT(A) IS ERRONEOUS AND NOT TE NABLE IN LAW AND ON FACTS, (B) THE APPELLANT CRAVES LEAVES TO ADD, ALTER OR AM END ANY/ALL OF THE GROUNDS OF APPEAL BEFORE OR DURING T HE COURSE OF THE HEARING OF THE APPEAL. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE LD. CIT(A) NOTED IN THE IMPUGNED ORDER THAT APPEAL HAS BEEN FI LED BEFORE HIM AGAINST THE ORDER UNDER SECTION 153A R.W.S.143( 3) DATED 30 TH DECEMBER, 2011, PASSED BY ACIT, CC-3, NEW DELHI. T HE LD. CIT(A) NOTED THE GROUNDS OF APPEAL OF ASSESSEE IN T HE APPELLATE ORDER IN WHICH THE ASSESSEE CHALLENGED THE ADDITION ON ACCOUNT OF UNSECURED LOANS OF RS.60 LAKHS AND INTEREST THER EON OF RS.1,04,949/- UNDER SECTION 68 OF THE I.T. ACT. THE LD. CIT(A) NOTED THAT REASONS FOR ADDITION MADE AGAINST THE AS SESSEE ARE SAME AS HAVE BEEN CONSIDERED IN THE CASE OF ASSESSE E FOR A.Y. 3 ITA.NO.3351/DEL./2014 M/S. MKR CONSTRUCTION (P) LTD., NEW DELHI. 2005-2006 WHICH HAVE BEEN DECIDED IN HIS FAVOUR, TH EREFORE, APPEAL OF ASSESSEE HAS BEEN ALLOWED. 3. LEARNED COUNSEL FOR THE ASSESSEE, AT THE OUTSET , SUBMITTED THAT REVENUE HAS TAKEN A WRONG GROUND OF APPEAL IN THE DEPARTMENTAL APPEAL BECAUSE THE LD. CIT(A) HAS DELETED THE ADDITION OF RS.60 LAKHS ON ACCOUNT OF UNEXPLAINED C ASH CREDIT AND INTEREST THEREON OF RS.1,04,949/-. 4. LD. D.R, HOWEVER, POINTED OUT THAT THE ORDER OF THE A.O. DATED 30 TH DECEMBER, 2011 SHOWS THAT A.O. HAS MADE ADDITION OF RS.1,61,04,949/- IN RESPECT OF FIVE PAR TIES WHICH IS CHALLENGED IN THE DEPARTMENTAL APPEAL. LEARNED COUN SEL FOR THE ASSESSEE FILED ONE MORE COPY OF THE ASSESSMENT ORDE R DATED 30 TH DECEMBER, 2011 PASSED BY THE SAME ACIT, CC-3, NEW D ELHI, IN WHICH THE A.O. HAS MADE ADDITION OF RS.60 LAKHS IN RESPECT OF FOUR PARTIES AND INTEREST OF RS.1,04,949/- HAVE BEE N DISALLOWED. COPY OF BOTH THE ASSESSMENT ORDERS ARE PLACED ON RE CORD. LEARNED COUNSEL FOR THE ASSESSEE ALSO SUBMITTED THA T IN ASSESSMENT YEAR UNDER APPEAL, A.O. MADE ADDITION ON ACCOUNT 4 ITA.NO.3351/DEL./2014 M/S. MKR CONSTRUCTION (P) LTD., NEW DELHI. OF UNSECURED LOANS. HOWEVER, IN A.Y. 2005-2006, THE LD. CIT(A) CONSIDERED THE ISSUE OF UNEXPLAINED SHARE APPLICATI ON MONEY AND DELETED THE ADDITION. THE TRIBUNAL IN ITS ORDER DATED 16.11.2017 DISMISSED THE DEPARTMENTAL APPEAL FOLLOW ING THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF KABUL CHAWLA 380 ITR 570 BECAUSE NO INCRIMINATING MATERIA L WAS FOUND AGAINST THE ASSESSEE DURING THE COURSE OF SEA RCH. LD. D.R. THEREFORE, SUBMITTED THAT THERE IS A CONFUSION ON T HE FACTS. THEREFORE, MATTER MAY BE REMANDED TO THE LD. CIT(A) TO DECIDE THE MATTER IN ISSUE AFRESH. 5. AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE ARE OF THE VIEW THAT THE MATTER REQUIRES RECONSIDERATION AT TH E LEVEL OF THE LD. CIT(A). THE LD. CIT(A) FOLLOWED HIS ORDER FOR A .Y. 2005-2006 FOR THE PURPOSE OF DELETING THE ADDITION. NO OTHER FINDINGS HAVE BEEN GIVEN BY THE LD. CIT(A). THE DEPARTMENT IN THE DEPARTMENTAL APPEAL CHALLENGED THE DELETION OF ADDI TION OF RS.1,61,04,949/- UNDER SECTION 68 OF THE I.T. ACT. THE DEPARTMENT HAS FILED COPY OF THE ASSESSMENT ORDER D ATED 30 TH 5 ITA.NO.3351/DEL./2014 M/S. MKR CONSTRUCTION (P) LTD., NEW DELHI. DECEMBER, 2011, IN WHICH THE A.O. HAS MADE ADDITION OF RS.1,61,04,949/- IN RESPECT OF 05 PARTIES. THE ORDE R HAS BEEN PASSED BY SHRI J.K. CHANDNANI, ACIT, CC-3, NEW DELH I. LEARNED COUNSEL FOR THE ASSESSEE, HOWEVER, FILED AN OTHER COPY OF THE ASSESSMENT ORDER HAVING THE SAME DATE 30 TH DECEMBER, 2011 PASSED BY THE SAME ACIT, CC-3, NEW DELHI SHRI J.K. CHANDNANI, IN WHICH THE A.O. MADE THE ADDITION OF R S.60 LAKHS ONLY IN RESPECT OF 04 PARTIES. IN THIS ORDER, THE A .O. DID NOT MAKE ADDITION OF RS.1 CRORE IN RESPECT OF EXCEL INFOTECH LTD., WHICH IS MADE IN ASSESSMENT ORDER FILED BY DEPARTMENT. COPY OF FORM- 35 FILED BEFORE LD. CIT(A), IS ALSO PLACED ON RECOR D IN WHICH THE ASSESSEE CHALLENGED THE ADDITION OF RS.60 LAKHS ON ACCOUNT OF UNEXPLAINED CASH CREDIT. IT APPEARS THAT A.O. PASSE D TWO CONTRADICTORY ORDERS, ONE COPY HAVE BEEN GIVEN TO T HE ASSESSEE WHICH IS HAVING LESSER ADDITION OF RS.60 LAKHS. THE DEPARTMENT HAS, HOWEVER, PRODUCED ANOTHER COPY OF ASSESSMENT O RDER OF THE SAME A.O. FOR THE SAME YEAR, IN WHICH THE ASSESSIN G OFFICER HAS MADE ADDITION OF RS.1,61,04,949/-. IT IS A SERIOUS LAPSE WHICH REQUIRES INVESTIGATION AT THE HIGHEST LEVEL, HOW TH E A.O. PASSED 6 ITA.NO.3351/DEL./2014 M/S. MKR CONSTRUCTION (P) LTD., NEW DELHI. TWO ORDERS ONE IN FAVOUR OF REVENUE AND ANOTHER IN FAVOUR OF ASSESSEE. IT MAY ALSO BE NOTED THAT THE LD. CIT(A) SIMPLY FOLLOWED HIS ORDER FOR A.Y. 2005-2006 FOR THE PURPO SE OF DELETING THE ADDITION. LEARNED COUNSEL FOR THE ASSESSEE HOWE VER, FAIRLY STATED THAT IN A.Y. 2005-2006, THE ISSUE WAS OF UNE XPLAINED SHARE APPLICATION MONEY, BUT, IN ASSESSMENT YEAR UN DER APPEAL, THE ISSUE IS OF UNSECURED LOANS. LD. CIT(A) HAS CO- TERMINUS POWERS TO THAT OF THE A.O. THEREFORE, IT IS HIS DUT Y TO VERIFY THE FACTS AND THEN PASS THE ORDER AS PER LAW. THE LD. C IT(A) WITHOUT GIVING ANY REASONS FOR DECISION IN THE APPELLATE OR DER PASSED THE ORDER FOLLOWING HIS ORDER FOR A.Y. 2005-2006 WHICH MAY NOT BE RELEVANT TO THE MATTER IN ISSUE. LD. CIT(A) HAVE AL SO NOT VERIFIED AS TO HOW TWO DIFFERENT ORDERS HAVE BEEN PASSED BY THE A.O. ON THE SAME MATTER IN ISSUE SHOWING DIFFERENT ADDITION S AGAINST THE ASSESSEE. IN THIS VIEW OF THE MATTER, WE ARE OF THE VIEW THAT THE MATTER IN ISSUE REQUIRES RECONSIDERATION AT THE LEV EL OF THE LD. CIT(A). WE, ACCORDINGLY, SET ASIDE THE IMPUGNED ORD ER AND RESTORE THE APPEAL TO THE FILE OF LD. CIT(A)-1, NEW DELHI, WITH A DIRECTION TO RE-DECIDE THE APPEAL OF ASSESSEE AS PE R LAW, BY 7 ITA.NO.3351/DEL./2014 M/S. MKR CONSTRUCTION (P) LTD., NEW DELHI. GIVING REASONABLE, SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AS WELL AS A.O. BECAUSE FACTS SHALL HAVE T O BE VERIFIED FROM THE RECORD OF THE ASSESSMENT AS TO HOW THE A.O . HAS PASSED TWO CONTRADICTORY ORDERS ON THE SAME MATTER IN ISSU E. THE LD. CIT(A) SHALL LOOK INTO THIS ASPECT WHILE PASSING TH E APPELLATE ORDER AND SHALL GIVE FINDING ON THE SAME. LD. CIT(A ) SHALL PASS THE ORDER ON MERITS DISCUSSING THE ENTIRE EVIDENCE ON RECORD. THE APPEAL OF THE REVENUE IS, THEREFORE, ALLOWED FO R STATISTICAL PURPOSES. 6. IN THE RESULT, APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (O.P. KANT) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DELHI, DATED 08 TH MAY, 2018 VBP/- 8 ITA.NO.3351/DEL./2014 M/S. MKR CONSTRUCTION (P) LTD., NEW DELHI. COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT E BENCH, DELHI 6. GUARD FILE. // BY ORDER // ASSISTANT REGISTRAR : ITAT DELHI BENCHES : DELHI.