Dharani Dhar Panda, Ganjam V. ITO, Phulbani Ward, Phulbani

ITA 347/CTK/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 7215 (ITAT-CUTTACK)
• Duration Of Justice: 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-01-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 17-01-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 19-09-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: D.K.PRADHAN
• Assessee Lawyers: D.K.SHETH
• Keywords: Unexplained cash credit; Set aside
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 92

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK SMC BENCH, CUTTACK BEFORE SHRI N.S SAINI, ACCOUNTANT MEMBER ITA NO.347 /CTK/2016 ASSESSMENT YEAR : 2011 - 12 DHARANIDHAR PANDA,AT: B. BERHAMPUR, PO: BIRANCHIPUR, VIA: BUGUDA, DIST: GANJAM VS. ITO, PHULBANI WARD, PHULBANI PAN/GIR NO. AMZPP 1188 M (APPELLANT ) .. ( RESPONDENT ) ASSESSEE BY : SHRI D.K.SHETH, AR REVENUE BY : SHRI D.K.PRADHAN, DR DATE OF HEARING : 1 7 /01/ 2017 DATE OF PRONOUNCEMENT : 17 /01/ 2017 O R D E R THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) - 1, BHUBANESWAR , DATED 17.6.2016 , FOR THE ASSESSMENT YEAR 2011 - 2012 . 2. THE SOLE ISSUED INVOLVED IN THIS APPEAL IS THAT THE LD CIT(A) ERRED IN CONFIRMI NG THE ADDITION OF RS.7,25,000/ - MADE BY THE ASSESSING OFFICER U/S.68 OF THE ACT. 3. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE ORDERS OF LOWER AUTHORITIES AND MATERIALS AVAILABLE ON RECORD. IN THE INSTANT CASE, THE 2 ITA NO.347/CTK/2016 ASSESSMENT YEAR :2011 - 12 ASSESSING OFFICER ADDED RS.7,25,000/ - U/S.68 OF THE ACT BY OBSERVING AS UNDER: DURING THE ASSESSMENT PROCEEDINGS THE ASSESSEE FAILED TO EXPLAIN THE CREDITS INTO THE DIFFERENT BANK ACCOUNTS MADE THROUGH CHEQUES AND CASH ON VARIOUS DATES DURING THE YEAR UNDER CONSIDERATION AS GIVEN BELOW. I) BANK A/C NO.50422200020840 OF SYNDICATE BANK, BERHAMPUR RS. 1,06,000/ - II) BANKA/CNO.30330943300OFSBI, BHANJANAGAR RS.4,22,550/ - III) BANK A/C NO. 11010912902 OF SB1, BALIPADAR. RS. 65,306/ - I V) BANK A/C NO.087510027000277 OF ANDHRA BANK, NIMINA RS. 1,32,000/ - TOTAL RS. 7,25,000/ - ACCORDINGLY THE SAME IS ADDED TO THE TOTAL INCOME OF THE ASSESSEE BEING UNEXPLAINED CASH CREDIT U/S 68 OF THE IT ACT, 1961 AS NO EXPLANATION WAS OFFERED REGARDING THE CREDITS 4. ON APPEAL, LD CIT(A) OBSERVED THAT AR OF THE ASSESSEE HAS FILED WRITTEN SUBMISSION AND MATERIALS EXPLAINING THE SOURCE OF DEPOSIT. HE DID NOT ACCEPT THE SAME AS THERE WAS VIOLATION OF RULE 46A OF INCOME TAX RULES AND, THEREFORE, CONFIRMED THE ACTION OF THE ASSESSING OFFICER. 5. BEFORE ME, LD A.R. OF THE ASS ESSEE SUBMITTED THAT THE ASSESSING OFFICER HAS MADE THE ADDITION U/S.68 OF THE ACT WITHOUT DISCUSSING WHY THE PLAUSIBLE EXPLANATION OF THE ASSESSEE WAS NOT ACCEPTED BY HIM. HE SUBMITTED THAT AN ASSESSMENT PROCEEDINGS IS A QUASHI - JUDICIAL PROCEEDINGS AND T HE ASSESSING OFFICER IS BOUND TO DISCLOSE THE REASONS FOR NOT ACCEPTING THE EXPLANATION GIVEN BY THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS. WITHOUT DOING SO, THE ADDITION MADE CANNOT BE SUSTAINED IN THE EYES OF LAW. 6. LD D.R. SUPPORTED THE ORDERS OF LOWER AUTHORITIES. 3 ITA NO.347/CTK/2016 ASSESSMENT YEAR :2011 - 12 6. I FIND FROM THE ABOVE QUOTED ORDER OF THE ASSESSING OFFICER THAT HE HAS NOT DISCUSSED IN HIS ORDER WHAT WAS THE QUERY RAISED BY HIM BEFORE MAKING THE ADDITION OF RS.7,25,000/ - U/S.68 OF THE ACT AND WHAT WAS THE REPLY OF THE ASSESSEE TO THE SAME AND WHY THE REPLY OF THE ASSESSEE WAS NOT ACCEPTED. THE ASSESSMENT PROCEEDINGS BEING A QUASHI JUDICIAL PROCEEDINGS, THE ASSESSING OFFICER IS BOUND TO GIVE REASONS IN ASSESSMENT ORDER BEFORE MAKING THE ADDITION AS TO WHY THE EXPLANATIO N OFFERED BY THE ASSESSEE IS NOT ACCEPTABLE. WITHOUT DOING SO, THE ADDITION MADE IS NOT SUSTAINABLE IN LAW. FURTHER, THE CIT( A) DID NOT ACCEPT THE WRITTEN SUBMISSION AND MATERIALS FILED BEFORE HIM EXPLAINING THE SOURCE OF DEPOSIT OBSERVING THAT IT IS IN VIOLATION OF RULE 46A OF INCOME TAX RULES, 1962. I DO NOT APPRECIATE THIS APPROACH OF THE CIT(A). THE HONBLE SUPREME COURT IN CIT VS. KANPUR COAL SYNDICATE (1964) 53 ITR 225 (SC) HAS HELD THAT CIT(A) HAS PLENARY POWER IN DISPOSING AN APPEAL. THE SCOPE OF HIS POWER IS CO - TERMINUS WITH THAT OF ITO. HE CAN DO WHAT THE ITO CAN DO AND ALSO DIRECT HIM TO DO WHAT HE HAS FAILED TO D O. IN THE CASE OF SREELEKHA BANERJEE VS CIT, (1963), 49 ITR 112 (SC), THE HONBLE SUPREME COURT HELD THAT THE DEPARTMENT CANNOT BY MERELY REJECTING A GOOD EXPLANATION UNREASONABLY, CONVERT GOOD PROOF INTO NO PROOF. I, THEREFORE, SET ASIDE THE ORDERS OF LO WER AUTHORITIES AND DELETE THE ADDITION OF RS.7,25,000/ - U/S.68 OF THE ACT MADE BY THE ASSESSING OFFICER AND CONFIRMED BY THE LD CIT(A) AND ALLOW THE GROUND OF APPEAL OF THE ASSESSEE. 4 ITA NO.347/CTK/2016 ASSESSMENT YEAR :2011 - 12 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRO NOUNCE D IN THE OPEN COURT ON 1 7 / 01/2017 IN THE PRESENCE OF PARTIES. SD/ - ( N.S SAINI) A CCOUNTANT MEMBER CUTTACK; DATED 17 /01 /2017 B.K.PARIDA, SPS COPY OF THE ORDER FORWARDED TO : BY ORDER, ASST.REGISTRAR, ITAT, CUTTACK 1. THE APPELLANT : DHARANIDHAR PANDA,AT: B. BERHAMPUR, PO: BIRANCHIPUR, VIA: BUGUDA, DIST: GANJAM 2. THE RESPONDENT. ITO, PHULBANI WARD, PHULBANI 3. THE CIT(A) - 1, BHUBANESWAR. 4. PR. CIT , BHUBANESWAR. 5. DR, ITAT, CUTTACK 6. GUARD FILE. //TRUE COPY//