.T.O.-4(2), Agra V. Smt. Krishna Mittal, Agra

ITA 339/AGR/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 50328 (ITAT-AGRA)
• Duration Of Justice: 1 year(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-08-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 09-08-2011
• Assessment Year: 2001-2002
• Appeal Filed On: 29-07-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VISHAMBAR DAYAL
• Assessee Lawyers: K K JAIN
• Keywords: Gift; Assessment record; Reassessment proceedings; Capital Gains
• Section: 142(1); 133(6); 143(2); 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, AGRA BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI K.G. BANSAL, ACCOUNTANT MEMBER ITA NO.339AGR/2010 ASSESSMENT YEAR: 2001-02 INCOME TAX OFFICER 4(2) VS. SMT. KRISHNA MITTA L, AGRA. B-569, KAMLA NAGAR, AGRA. (PAN : ABVPM 0264). (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI VISHAMBAR DAYAL, JR. D.R. RESPONDENT BY : SHRI K.K. JAIN, ADVOCATE ORDER PER BENCH : THE REVENUE HAS FILED THE PRESENT APPEAL AGAINST T HE IMPUGNED ORDER DATED 24.05.2010 PASSED BY THE LD. CIT(A)-II, AGRA ON THE FOLLOWING GROUNDS OF APPEAL :- 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEAL)-II, AGRA HAS ERRED IN LAW IN ALLOWING THE ASSESSEES APPEAL QUASHING THE PROCEEDINGS INITIATED U/S 147/148 BY THE ASSESSING OFFICER WITHOUT PROPERLY APPRECIATING THE FACTS OF THE CASE. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EAL)-II, AGRA HAS ERRED IN LAW AND ON FACTS IN HOLDING THAT THE NOTICE ISSUED U/S 148 WAS NOT SERVED ON THE APPELLANT WHEREAS THE SAME WAS ISSUED ON THE LAST KNOWN ADDRESS OF THE ASSESSEE. 3. THAT THE LEARNED CIT(APPEAL)-II, AGRA HAS NOT AP PRECIATED THE FACT THAT AT THE TIME THE CAPITAL GAINS EARNED BY T HE ASSESSEE, THE AO 2 HAD JURISDICTION OVER THE ASSESSEE, AND HIS ACTION WAS COVERED BY THE PROVISIONS OF SECTION 124(5). 4. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EAL)-II, AGRA HAS ERRED IN LAW AND ON FACTS IN HOLDING THAT PRESE NT ADDRESS OF THE ASSESSEE WAS VERY WELL WITHIN THE KNOWLEDGE OF THE ASSESSING OFFICER AS PER RETURN FILED WHEREAS THE ASSESSEE HAD FILED HER RETURN WITH ANOTHER OFFICER, I.E. ITO-1(4), AGRA AND NOT WITH A SSESSING OFFICER - 1(2), AGRA WHO HAD ISSUED NOTICE U/S 148 OF THE IT ACT. 5. THAT THE ORDER OF THE LEARNED COMMISSIONER OF IN COME TAX (APPEALS) BEING ERRONEOUS IN LAW AND ON FACTS BE SE T ASIDE AND THAT THE A.O.S ORDER MAY BE RESTORED. 6. THAT THE APPELLANT CRAVES LEAVE TO ADD OR ALTER ANY OR MORE GROUND OR GROUNDS OF APPEAL AS MAY BE DEEMED FIT AT THE TIME OF HEARING OF APPEAL. 2. THE FACTS RELATING TO THE ISSUE IN DISPUTE ARE T HAT THE INCOME TAX OFFICER- 1(2), AGRA RECEIVED SOME INFORMATION ALONG WITH A L IST OF SOME BENEFICIARY FROM ADDL. DIT (INV), AGRA REGARDING BOGUS TRANSACTION O F LONG TERM/SHORT TERM CAPITAL GAIN AND BOGUS GIFTS WHICH HAVE BEEN CREDIT ED TO THE BANK ACCOUNT OF THE BENEFICIARY. ACCORDING TO THE INFORMATION, THE ASS ESSEE IS ONE OF SUCH BENEFICIARY IN THIS BANK ACCOUNT NO.11968 EXITING IN CENTRAL BA NK OF INDIA, FAUVARA, AGRA. A SUM OF RS.3,53,244 + RS.3,53,244 = RS.7,06,488/- HA S BEEN CREDITED ON 20.05.2000. THIS AMOUNT WAS REMITTED FROM M/S FRIE NDS FORTFOLIO PVT. LTD. THROUGH BANK DRAFT AS SALE PROCEEDS OF SHARES. THE ASSESSING OFFICER, AFTER RECORDING THE REASONS AND OBTAINING NECESSARY APPRO VAL OF ADDL. CIT(A), RANGE-1, AGRA, ISSUED NOTICE UNDER SECTION 148 OF THE INCOME TAX ACT, 1961 (THE ACT 3 HEREINAFTER) ON 20.03.2008 ON THE ADDRESS WHICH IS GIVEN IN THE INVESTIGATION WING, AGRA I.E. 9/197, BAGH MUZAFFAR KHAN, AGRA. THE ASS ESSING OFFICER SENT THIS NOTICE ON THE SAME ADDRESS BY POST AS WELL AS SERVE D BY AFFIXTURE THROUGH THE INSPECTOR ON 30.03.2008. THE ASSESSING OFFICER ALS O ISSUED NOTICE UNDER SECTION 142(1) OF THE ACT ON 02.07.2008 TO THE ASSESSEE. I N COMPLIANCE OF THE SAME, THE ASSESSEE FILED OBJECTION IN THE SHAPE OF REPLY DATE D 18.07.2008 BY MENTIONING HER NEW ADDRESS I.E. B-569 KAMLA NAGAR, AGRA. AFTER OB TAINING THIS REPLY AND OBJECTION, THE INCOME TAX OFFICER 1(2), AGRA HAS TR ANSFERRED THIS CASE TO INCOME TAX OFFICER-4(2), AGRA. AFTER RECEIVING THE FILE O F THE ASSESSEE, THE INCOME TAX OFFICER-4(2), AGRA ISSUED NOTICE UNDER SECTION 143( 2) OF THE ACT ON 25.07.2008. IN COMPLIANCE OF THE SAME, THE LD. AUTHORISED REPRESEN TATIVE OF THE ASSESSEE APPEARED AND REQUESTED FOR INSPECTION OF THE FILE W HICH WAS ALLOTTED TO HIM. THE LD. AUTHORISED REPRESENTATIVE OF THE ASSESSEE HAS F ILED OBJECTION DATED 26.08.2008 AND THE ASSESSING OFFICER REPLIED THE SAME TO THE A SSESSEE ON 14.11.2008. THE ASSESSING OFFICER ALSO SOUGHT INFORMATION UNDER SEC TION 133(6) FROM CENTRAL BANK OF INDIA, FAUVARA, AGRA IN WHICH IT HAS BEEN FOUND THAT TILL DATE THE ASSESSEE HAS MAINTAINED HER OLD ADDRESS I.E. 9/197 BAGH MUZAFFAR KHAN, AGRA WHICH WAS RECEIVED FROM THE ADDL. D.I.T. (INV.), AGRA ON THE BASIS OF WHICH A NOTICE UNDER SECTION 148 OF THE ACT WAS ISSUED AND THE ASSESSING OFFICER HELD THAT, FOR THESE REASONS THE SAME IS VALID AND THE OBJECTIONS FILED BY THE ASSESSEE ARE NOT SUSTAINABLE. 4 3. ON 28.11.2008 THE LD. COUNSEL FOR THE ASSESSEE A PPEARED BEFORE THE ASSESSING OFFICER AND FILED A WRITTEN REPLY ON BEHA LF OF THE ASSESSEE IN WHICH HE HAS STATED THAT SINCE THE SERVICE OF NOTICE UNDER S ECTION 148 HAS BEEN QUESTIONED AND, AS SUCH, HE IS PRECLUDED IN COMPLYING WITH ANY NOTICE/REQUIREMENTS AS PER PROVISIONS OF SECTION 292BB. KEEPING IN VIEW OF TH E REPLY FILED BY THE LD. COUNSEL FOR THE ASSESSEE, THE ASSESSING OFFICER IS OF THE OPINION THAT THE ASSESSEE IS NOT CO-OPERATING WITH THE DEPARTMENT AND HAS NOT FI LED ANY RETURN IN COMPLIANCE OF THE NOTICE UNDER SECTION 148 OF THE ACT AND NOTICE UNDER SECTION 142(1) FOR THE YEAR UNDER CONSIDERATION, HE HAS NO OPTION EXCEPT TO COM PLETE THE CASE UNDER SECTION 147/144 ON THE BASIS OF INFORMATION AND FACTS AVAIL ABLE ON RECORD. THE ASSESSING OFFICER ALSO MENTIONED THAT NOTICE ISSUED UNDER SEC TION 143(2) ON 25.07.2008 MAY BE TREATED AS WITHDRAWN BECAUSE NO VALID RETURN IS AVAILABLE BEFORE HIM. AS THE ASSESSEE HAS NOT FILED ANY RETURN AS PER SECTION 14 8 OF THE ACT ON THE BASIS OF ONE CASE OF SHRI ASHOK KUMAR LAVANIA A.Y. 2001-02, M/S BAIJ NATH AGARWAL A.Y. 2001-02 AND BRIJ MOHAN AGARWAL A.Y. 2001-02 IN WHIC H SIMILAR TYPE OF BOGUS ACCOMMODATION ENTRY ARRANGED THROUGH VARIOUS BROKER S HAVE ALREADY BEEN ASSESSED UNDER SECTION 148/143(3) OF THE ACT IN RANGE-4, AGR A AND THE CASE OF THE ASSESSEE IS SIMILAR. THEREFORE, THE ENTIRE TRANSACTION SHOW N BY HIM WITH M/S. FRIENDS FORTFOLIO P. LTD. FOR RS.7,06,488/- (3,53,244 + 3,5 3,244) IS FOUND BOGUS AND TOTAL AMOUNTS CREDITED IN HER S.B. ACCOUNT NO 11968 OF CE NTRAL BANK OF INDIA, FAUVARA, AGRA ON 20.05.2000 IS TREATED AS UNEXPLAINED MONEY DEPOSITED IN HER AFORESAID 5 BANK ACCOUNT AND ADDED BACK TO THE INCOME OF THE AS SESSEE AND HE COMPLETED THE ASSESSMENT UNDER SECTION 147/144 ON 05.12.2008. AG GRIEVED BY THE SAME, THE ASSESSEE FILED APPEAL BEFORE THE LD. FIRST APPELLAT E AUTHORITY WHO, VIDE ORDER DATED 24.05.2010 ALLOWED THE APPEAL OF THE ASSESSEE ON THE LEGAL GROUND HOLDING THAT THE ASSESSING OFFICER HAD NO JURISDICTION OVER THE CASE OF THE ASSESSEE BECAUSE NOTICE UNDER SECTION 148 OF THE ACT HAS NOT BEEN SE RVED UPON THE ASSESSEE AND LD. FIRST APPELLATE AUTHORITY QUASHED THE REASSESSMENT PROCEEDINGS INITIATED UNDER SECTION 148 OF THE ACT BY ALLOWING THE APPEAL FILED BY THE ASSESSEE. NOW THE REVENUE, BEING AGGRIEVED AGAINST THE IMPUGNED ORDER DATED 24.05.2010, FILED THE PRESENT APPEAL. 4. AT THE TIME OF HEARING, THE LD. DEPARTMENTAL REP RESENTATIVE RELIED UPON THE ORDER PASSED BY THE ASSESSING OFFICER AND, ON THE C ONTRARY, THE LD. COUNSEL FOR THE ASSESSEE RELIED UPON THE ORDER PASSED BY HE LD. FIR ST APPELLATE AUTHORITY. HE FURTHER STATED THAT THE ASSESSEE FILED HER RETURN O F INCOME ON 13.08.2001 WITH I.T.O 1(4), AGRA HAVING JURISDICTION AT THAT TIME AND ON 02.07.2008 THE ASSESSING OFFICER ISSUED NOTICE UNDER SECTION 142(1) TO THE ASSESSEE FIXING THE DATE FOR 18.07.2008 AND THE ASSESSEE RAISED OBJECTION REGARDING NON-SER VICE OF NOTICE UNDER SECTION 148 OF THE ACT UPON THE ASSESSEE AS WELL AS NOTICE UNDE R SECTION 142(1) WAS WITHOUT JURISDICTION. THE ASSESSEE ALSO REQUESTED TO THE A SSESSING OFFICER TO SUPPLY THE PROOF OF SERVICE OF NOTICE UNDER SECTION 148 OF THE ACT. LD. COUNSEL FOR THE 6 ASSESSEE FURTHER STATED THAT ON 19.07.2008 THE RECO RD OF THE ASSESSEE WAS TRANSFERRED FROM ITO-1(2), AGRA TO ITO-4(2), AGRA A FTER FILING THE OBJECTION OF THE ASSESSEE AND AGAIN ITO-4(2), AGRA ISSUED NOTICE UND ER SECTION 143(2) ON 25.07.2008 FIXING THE CASE FOR 08.08.2008 TO THE AS SESSEE. ON 08.08.2008, THE ASSESSEE AGAIN FILED OBJECTIONS FOR NON-SERVICE OF NOTICE UNDER SECTION 148 OF THE ACT. THE ASSESSEE ALSO REQUESTED FOR INSPECTION OF RECORDS WHICH WAS ALLOWED ON 13.08.2008 BY THE ASSESSING OFFICER AND HE NOTICED THAT THERE IS NO EVIDENCE ON RECORD WHETHER THE NOTICE ISSUED UNDER SECTION 148 WAS SERVED UPON THE ASSESSEE OR RETURNED UNSERVED. HE FURTHER STATED THAT SERVICE OF NOTICE BY AFFIXTURE ON 31.03.2008 PROVED THAT THE NOTICE WAS RETURNED UNSE RVED, BUT ON RECORD THERE IS NO NOTICE AVAILABLE ON RECORD AS UNSERVED. LD. COUNSE L FOR THE ASSESSEE HAS ALSO FILED ONE SMALL PAPER BOOK CONTAINING PAGES 1 TO 21 IN WH ICH HE HAS ATTACHED COPY WRITTEN SUBMISSIONS BEFORE THE CIT(A), COPY OF SARA L, COPY OF LETTER DATED 18.07.2008 FILED BEFORE ITO-1(2), AGRA, COPY OF LET TER DATED 08.08.2008 FILED BEFORE ITO-4(2), AGRA, COPY OF LETTER DATED 26.08.2 008 OBJECTING THE SERVICE OF NOTICE U/S 148, COPY OF ORDER DATED 14.11.2008 DISP OSING OFF THE OBJECTIONS PASSED BY ASSESSING OFFICER, COPY OF LETTER DATED 25.11.20 08 FILED IN COMPLIANCE TO ORDER DATED 14.11.29008, COPY OF BANK PASS BOOK A/C NUMBE R 11968 CENTRAL BANK OF INDIA, FOUNTAIN, AGRA. HE HAS ALSO CERTIFIED THAT THESE PAPERS ARE PART OF RECORDS OF THE REVENUE AUTHORITIES. 7 5. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE R ECORDS AVAILABLE WITH US. THIS BENCH ALSO GOT THE ASSESSMENT RECORD VIDE ORDE R DATED 19.07.2011. IN COMPLIANCE OF THE SAME, LD. DEPARTMENTAL REPRESENTA TIVE PRODUCED THE SAME TODAY BEFORE THE BENCH. WE HAVE PERUSED THE SAME. AFTER THOROUGHLY GOING THROUGH THE ORDER PASSED BY THE REVENUE AUTHORITIES AS WELL AS THE ASSESSMENT RECORDS AVAILABLE WITH US, WE FIND THAT THE ITO-1(2 ), AGRA ISSUED A NOTICE UNDER SCION 148 OF THE ACT DATED 20.03.2008 TO THE ASSESS EE ON THE ADDRESS I.E. 9/197, BAGH MUZAFFAR KHAN, AGRA. ON THIS NOTICE, THE INCO ME TAX INSPECTOR ON 24.03.2008 REPORTED THAT THE TAX PAYEE HAS LEFT THE PLACE AFTER SELLING THE HOUSE SINCE 6 YEARS. THIS NOTICE WAS ALSO SENT BY POST A S WELL AS SERVED BY AFFIXTURE THROUGH THE INSPECTOR ON THE SAME ADDRESS ON 31.03. 2008. AS PER THE PAPER BOOK FILED BY THE LD. COUNSEL FOR THE ASSESSEE, AT PAGE NO.9, WE FIND THAT THE ASSESSEE HAS FILED HER RETURN ON 13.08.2001 TO THE ITO-1(4), AGR A IN WHICH SHE HAS WRITTEN HER ADDRESS AS B-569, KAMLA NAGAR, AGRA. THE ASSESSEE HAS ALSO INFORMED TO THE SAME ASSESSING OFFICER ABOUT THE SAME ON 18.07.2008 IN REPLY TO THE NOTICE UNDER SECTION 142(1) DATED 02.07.2008 ON THE OBJECTION TH AT PROCEEDINGS UNDER SECTION 147 OF THE ACT WERE INITIATED BY ISSUING NOTICE UND ER SECTION 148 DATED 28.3.2008 FOR THE A.Y. 2001-02 WHICH HAS NOT BEEN SERVED UPON THE ASSESSEE. SHE STATED THAT THE NOTICE UNDER SECTION 148 IS WITHOUT JURISDICTIO N AND ALSO REQUESTED TO SUPPLY THE PROOF OF SERVICE OF NOTICE UNDER SECTION 148 OF THE ACT AT THE ADDRESS MENTIONED ABOVE. AFTER PERUSING ALL THE CORRESPONDENCES BY T HE ASSESSEE WITH THE ASSESSING 8 OFFICER AS WELL AS ASSESSMENT RECORDS PRODUCED BY T HE LD. DEPARTMENTAL REPRESENTATIVE, WE FIND THAT NOTICE DATED 28.03.200 8 ISSUED UNDER SECTION 148 OF THE ACT TO THE ASSESSEE ON THE ADDRESS AT 9/197, BA GH MUZAFFAR KHAN, AGRA, THERE IS NO PROOF OF SERVICE OF THIS NOTICE UPON THE ASSESSE E. WE ALSO PERUSED THE COPY OF BANK PASS BOOK OF ACCOUNT NO.11968 EXISTING IN THE CENTRAL BANK OF INDIA, FAUVARA, AGRA, IN WHICH ACCORDING TO THE INFORMATIO N OF THE ADDL. DIT (INV.), AGRA REGARDING AMOUNT OF RS.3,53,244 + 3,53,244 = RS.7,0 6,488/- HAS BEEN CREDITED ON 20.05.2000, IT IS FOUND THAT NO ENTRIES OF THE SAME ARE AVAILABLE IN THE PASS BOOK. WE FAILED TO UNDERSTAND FROM WHERE THE REVENUE AUTH ORITIES HAS TAKEN THIS FIGURE AND ALLEGING THAT THE ASSESSEE IS ONE OF THE BENEFI CIARY IN WHOSE BANK ACCOUNT EXISTING IN THE CENTRAL BANK OF INDIA, FAUVARA, AGR A A SUM OF RS.7,06,488/- HAS BEEN CREDITED ON 20.05.2000 WHICH WAS ADMITTED BY T HE M/S. FRIENDS FORTFOLIO PVT. LTD. THROUGH BANK DRAFT AS SALE PROCEEDS OF SH ARES. WE ARE OF THE CONSIDERED OPINION THAT THE BASIS OF INITIATING THE PROCEEDING S UNDER SECTION 148 OF THE ACT IS NON-EXISTING. THEREFORE, THE ASSESSING OFFICER HAS NO JURISDICTION TO ISSUE NOTICE TO THE ASSESSEE UNDER SECTION 148 OF THE ACT. SECO NDLY, THE LD. FIRST APPELLATE AUTHORITY HAS RIGHTLY HELD THAT THE ITO-1(2) HAS NO JURISDICTION OVER THE CASE OF THE ASSESSEE BECAUSE THIS NOTICE WAS NOT SERVED UPON TH E ASSESSEE. WE HAVE THOROUGHLY GONE THROUGH THE ORDER PASSED BY THE LD. FIRST APPELLATE AUTHORITY AND WE ARE OF THE CONSIDERED OPINION THAT THE LD. FIRST APPELLATE AUTHORITY HAS RIGHTLY HELD THAT NO NOTICE UNDER SECTION 148 OF THE ACT WA S SERVED UPON THE ASSESSEE. 9 THEREFORE, THE ASSESSMENT IN DISPUTE IS WITHOUT JUR ISDICTION AND LIABLE TO BE QUASHED. WE FIND NO INFIRMITY IN THE ORDER PASSED BY THE LD. FIRST APPELLATE AUTHORITY. THEREFORE, WE UPHOLD THE SAME BY DISMISS ING THE APPEAL FIELD BY THE REVENUE. 6. IN THE RESULT, APPEAL FILED BY THE REVENUE IS DI SMISSED. (ORDER PRONOUNCED IN THE OPEN COURT ON 11.08.20 11). SD/- SD/- (K.G. BANSAL) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER PLACE: AGRA DATE: 11 TH AUGUST, 2011 PBN/* COPY OF THE ORDER FORWARDED TO: APPELLANT/RESPONDENT/CIT CONCERNED/CIT(APPEALS) CO NCERNED/D.R., ITAT, AGRA BENCH, AGRA/GUARD FILE. BY ORDER ASSISTANT REGISTRAR INCOME-TAX APPELLATE TRIBUNAL, AGRA TRUE COPY