Ariah Singh, New Delhi V. ITO, New Delhi

ITA 3366/DEL/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 3014 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 8 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2006-2007
• Appeal Filed On: 29-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S L ANURAGI
• Assessee Lawyers: K SAMPATH SHRI V RAJA KUMAR
• Keywords: Unexplained cash credit; Opportunity of being heard; Reason to believe; Reassessment proceedings
• Section: 142(1); 68; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : SMC : NEW DELHI BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER ITA NO.3365/DEL/2017 ASSESSMENT YEAR: 2006-07 KULTAR SINGH, 17/3, 2 ND FLOOR, KALKAJI, NEW DELHI. PAN: CMWPS0485F VS. ITO, WARD-23(2), NEW DELHI. ITA NO.3366/DEL/2017 ASSESSMENT YEAR: 2006-07 ARIAH SINGH, C-63B, GANGOTRI ENCLAVE, ALAKNANDA, NEW DELHI. PAN: ABFPS9931C VS. ITO, WARD-23(2), NEW DELHI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI K. SAMPATH, ADVOCATE SHRI V. RAJA KUMAR, ADVOCATE REVENUE BY : SHRI S.L. ANURAGI, SR.DR DATE OF HEARING : 19.02.2019 DATE OF PRONOUNCEMENT : 27.02.2019 ORDER THE ABOVE TWO APPEALS BY THE RESPECTIVE ASSESSEES A RE DIRECTED AGAINST THE SEPARATE ORDERS DATED 30 TH MARCH, 2017 OF THE CIT(A)-10, NEW DELHI, RELATING TO ASSESSMENT YEAR 2006-07. SINCE IDENTICAL GROUNDS HA VE BEEN TAKEN BY BOTH THE ASSESSEES, THEREFORE, THESE WERE HARD TOGETHER AND ARE BEING DISPOSED OF BY THIS COMMON ORDER. ITA NOS.3365 & 3366/DEL/2017 2 ITA NO.3365/DEL/2017 2. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESS EE IS AN INDIVIDUAL. THE CASE OF THE ASSESSEE WAS REOPENED U/S 148 OF THE IT ACT, 1961 B Y RECORDING THE FOLLOWING REASONS:- REASONS RECORDED FOR INITIATION PROCEEDINGS U/S 14 8 OF THE I T ACT, 1961IN THE CASE OF SH KULTAR SINGH FOR THE AY 2006-07 THE INCOME TAX OFFICER (INV. UNIT IV(2), NEW DELHI VIDE HIS LETTER F.NO. ITO (INV)/ UNIT-IV(2)/2012-13 DATED 15.03.2013 HAD SENT A REPORT IN THE CASE OF SHKULTAR SINGH S/O S. HARBANS SINGH. AS PER THE INVESTIGATION MADE, THE ASSESSEE HAD DEP OSITED UNACCOUNTED CASH IN HIS BANK ACCOUNT. THE DETAIL ARE AS FOLLOWS: 1. UNEXPLAINED CASH CREDIT/ UNEXPLAINED MONEY A.Y 2006-07 RS. 18,76,350/- AS PER THE INFORMATION, THE AVTAR SINGH & FAMILY RE CEIVED TOTAL AMOUNT FOR ACQUISITION OF PROPERTY IN MAIDANGARHI POPULARLY KN OWN AS SAINIK FARMS AREA OF SOUTH DELHI TOTAL RS 56.29 CRORES (DD COMPONENT RS 14.43CRORES AND CASH COMPONENTS RS 41.86CRORES) FROM THE ABOVE SAID PROP ERTY ACQUISITION. AS THERE IS NO SEPARATE DIVISION MENTIONED IN THE LETTER RECEIV ED FROM ITO (INV) UNIT-IV-2, NEW DELHI FOR THE AMOUNT RECEIVED ON THE ACQUISITIO N OF THE SAID PROPERTIES AND THERE ARE THREE PERSONS ARE INVOLVED AS THE OWNER O F THE SAID PROPERTY SUCH AS (I) SHRI AVTAR SINGH R/O C-523, CHITTARANJAN PARK, NEW DELHI, (II) SHRI KULTAR SINGH R/O D-665, CHITTARANJAN PARK, NEW DELHI, (III) SHRI ARYA SINGH R/O C-63B, GANGOTRI ENCLAVE, ALAKNANDA, NEW DELHI. THEREFORE, IT IS ASSUMED THAT THEY ARE HAVING EQUAL SHARE I.E. 1/3 RD OF THE TOTAL RECEIPT. AS PER THE ABOVE FACTS, THE UNEXPLAINED CASH CREDIT / UNEXPLAINED MONEY U/S 68 & 69A OF THE INCOME TAX ACT, 1961 HAS ESCAPED ASSESSM ENT IN THE CASE OF SHRI KULTAR SINGH FOR A.Y 2006-07 TO THE EXTENT OF RS 18 ,76,350/- AS PER THE PROVISIONS OF THE INCOME TAX ACT, 1961. IN VIEW OF ABOVE MENTIONED FACTS, I HAVE REASON TO BELIEVE THAT INCOME TO THE TUNE OF RS 18,76,350/- HAS ESCAPED ASSESSMENT WITHI N THE MEANING OF SECTION 148 OF THE INCOME TAX ACT, 1961. ACCORDINGLY, NECESSARY PERMISSION/ APPROVAL UNDER SECTION 151(2) OF THE INCOME TAX ACT, 1961 MAY KIND LY BE ACCORDED FOR ISSUANCE O NOTICE U/S 148 OF THE INCOME TAX ACT, 1961 FOR A. Y 2006-07. SD/- (UMESH KUMAR) ITA NOS.3365 & 3366/DEL/2017 3 INCOME TAX OFFICER WARD-23(2), NEW DELHI 3. IN RESPONSE TO THE NOTICE ISSUED U/S 148, THE AS SESSEE FILED ITS RETURN OF INCOME ON 28 TH FEBRUARY, 2014 DECLARING TOTAL INCOME AT RS.2,11,1 14/-. THE ASSESSING OFFICER ISSUED STATUTORY NOTICES U/S 142(1) AND 143(2) TO W HICH THE ASSESSEE APPEARED BEFORE THE ASSESSING OFFICER. THE ASSESSING OFFICER, AFTE R CONSIDERING THE DETAILS FILED BY THE ASSESSEE AND CONSIDERING THE DETAILS RECEIVED FROM THE DRI, MUMBAI REGARDING THE CASH TRANSACTIONS IN PURCHASE AND SALE OF LAND, DET ERMINED THE TOTAL LONG-TERM CAPITAL GAIN IN THE HANDS OF THE ASSESSEE AT RS.33,59,434/- . AFTER DEDUCTING THE LONG-TERM CAPITAL GAIN SHOWN BY THE ASSESSEE AT RS.1,63,201, THE ASSESSING OFFICER MADE AN ADDITION OF RS.31,96,233/- ON ACCOUNT OF LONG-TERM CAPITAL GAIN IN THE HANDS OF THE ASSESSEE. SIMILAR ADDITION HAS BEEN MADE IN THE HA NDS OF SHRI ARIAH SINGH (ITA NO.3366/DEL/2017). 4. BEFORE THE CIT(A), APART FROM CHALLENGING THE AD DITION ON MERIT, THE ASSESSEE CHALLENGED THE VALIDITY OF REASSESSMENT PROCEEDINGS . HOWEVER, THERE WAS NO RELIEF GRANTED BY THE CIT(A) WHO UPHELD THE VALIDITY OF TH E REASSESSMENT PROCEEDINGS. HOWEVER, DUE TO CERTAIN ARITHMETICAL INACCURACY, HE DIRECTED THE ASSESSING OFFICER TO ADOPT THE VALUE OF LONG-TERM CAPITAL GAIN IN RESPEC T OF THE ASSESSEE AT RS.31,96,233/- AS AGAINST RS.33,59,434/-. AGGRIEVED WITH SUCH ORDER OF THE CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL RAISING THE FOLLOWING GR OUNDS:- THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT (A) ERRED IN CONFIRMING THE FOLLOWING ACTIONS OF TH E ASSESSING OFFICER: ITA NOS.3365 & 3366/DEL/2017 4 1. THAT THE PROCEEDINGS INITIATED, MAINTAINED AND CONC LUDED U/S 147/148 OF THE ACT ARE AB INITIO, VITIATED AND ILLEGAL MUST BE QUASHED WITH DIRECTIO NS FOR RELIEF; 2. THAT THE ORDERS OF THE AUTHORITIES BELOW ARE CONTR ARY TO FACTS AND BAD IN LAW AND SO MUST BE QUASHED; 3. THAT THE ADOPTION OF THE SALE CONSIDERATION AT RS. 35,96,233/- AS AGAINST THE ACTUAL FIGURE OF RS. 4 LACS IS ARBITRARY, MISCO NCEIVED, ERRONEOUS AND UNTENABLE AND BEING AGAINST FACTS AND LAW MUST BE R EJECTED WITH DIRECTIONS TO ADOPT THE TRUE FIGURE OF RS. 4 LACS AS SALE CONSIDE RATION FOR COMPUTATION OF CAPITAL GAINS. 5. IDENTICAL GROUNDS HAVE BEEN TAKEN BY THE ASSESSEE S HRI ARIAH SINGH IN ITA NO.3366/DEL/2017. 6. I HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT MAY BE PERTINENT TO MENTION HERE THAT THE LAND WAS SOLD BY SHRI AVTAR SINGH, SHRI KULTAR SINGH AND SHR I ARIAH SINGH. ON A POINTED QUERY BY THE BENCH AS TO WHAT HAS HAPPENED IN THE CASE OF SHRI AVTAR SINGH, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE APPEAL IS PENDI NG BEFORE THE CIT(A) AND HE IS YET TO PASS THE ORDER IN THE CASE OF SHRI AVTAR SINGH. TH EREFORE, WHEN IT WAS PROPOSED THAT WHY THE ABOVE TWO APPEALS ALSO SHOULD NOT BE SENT B ACK TO THE FILE OF THE CIT (A) TO DECIDE THE ISSUE AFRESH AND TO MAINTAIN CONSISTENCY , THE LD. COUNSEL FOR THE ASSESSEE AS WELL AS THE LD. DR HAVE NO OBJECTION FOR THE SAME. IN VIEW OF THE ABOVE, I DEEM IT PROPER TO RESTORE BOTH THE APPEALS TO THE FILE OF T HE CIT(A) TO PASS FRESH ORDERS ALONG WITH THE OTHER CO-OWNER, NAMELY, SHRI AVTAR SINGH S O THAT CONSISTENCY IS MAINTAINED. NEEDLESS TO SAY, THE LD.CIT(A) SHALL DECIDE THE ISS UE IN ACCORDANCE WITH THE LAW AFTER GIVING DUE OPPORTUNITY OF BEING HEARD TO THE RESPEC TIVE ASSESSEES. I HOLD AND DIRECT ITA NOS.3365 & 3366/DEL/2017 5 ACCORDINGLY. THE ABOVE APPEALS FILED BY THE RESPECT IVE ASSESSEES ARE ALLOWED FOR STATISTICAL PURPOSES. 7. IN THE RESULT, BOTH THE APPEALS FILED BY T HE ASSESSEES ARE ALLOWED FOR STATISTICAL PURPOSES. THE DECISION WAS PRONOUNCED IN THE OPEN COURT ON 2 7.02.2019. SD/- ( R.K. PANDA) ACCOUNTANT MEMFBE R DATED: 27 TH FEBRUARY, 2019 DK COPY FORWARDED TO 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASSTT. REGISTRAR, ITAT, NEW DELHI