Shri Rama Pati Gupta, Pratapgarh V. ITO, Pratapgarh

ITA 348/ALLD/2014

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 2520 (ITAT-ALLAHABAD)
• Duration Of Justice: 6 year(s) 6 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-11-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 26-05-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Principle of natural justice; Non compliance; Set aside
• Section: 147; 148; 144; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, ALLAHABAD BENCH, ALLAHABAD (THROUGH VIRTUAL COURT) BEFORE SHRI.VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ITA NO. 348/ALLD/2014 ASSESSMENT YEAR: 2009-10 SRI RAMAPATI GUPTA PROP. M/S. R.P. AUTOMOBILES, CHANDRA ROAD, PATTI, PRATAPGARH, U.P. V. ITO, PRATAPGARH PAN: ACJPG 9230 F (APPELLANT) (RESPONDENT) APPELLANT BY: NONE RESPONDENT BY: SHRI A. K. SINGH, SR. DR DATE OF HEARING: 26. 11. 2020 DATE OF PRONOUNCEMENT: 27.11. 2020 O R D E R PER SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER: THIS APPEAL, FILED BY ASSESSEE, BEING ITA NO. 348/ALLD/2014, IS DIRECTED AGAINST APPELLATE ORDER DATED 25.03.2014 IN APPEAL NO. 16/ITO/PRATAPGARH/CIT(A)- III/LKO/12-13 PASSED BY LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-III, LUCKNOW(HEREINAFTER CALLED 'THE CIT(A)'),FOR ASSESSMENT YEAR(AY):2009-10, THE APPELLATE PROCEEDINGS HAD ARISEN BEFORE LEARNED CIT(A) FROM ASSESSMENT ORDER DATED 22.01.2013 PASSED BY LEARNED ASSESSING OFFICER (HEREINAFTER CALLED 'THE AO') U/S 147 ITA NO.348/ALLD/2014 ASSESSMENT YEAR: 2009-10 SRI RAMAPATI GUPTA 2 READ WITH SECTION 144 OF THE INCOME-TAX ACT , 1961 (HEREINAFTER CALLED 'THE ACT') FOR AY: 2009-10. NONE APPEARED FOR ASSESSEE WHEN THE APPEAL WAS CALLED FOR HEARING BEFORE THE BENCH. WE HAVE HEARD LEARNED DR THROUGH VIDEO CONFERENCING MODE THROUGH VIRTUAL COURT. 2. THE GROUNDS OF APPEALS RAISED BY ASSESSE IN MEMO OF APPEAL FILED WITH INCOME- TAX APPELLATE TRIBUNAL, ALLAHABAD ( HEREINAFTER CALLED THE TRIBUNAL ) READS AS UNDER : 1. THAT WITHOUT CONSIDERING THE FULL FACTS AND RECORD OF THE CASE LEARNED LOWER AUTHORITIES HAS WRONGLY CONFIRM THE ORDER PASSED U/S 147/ 144 OF THE INCOME TAX ACT. 2. THAT THE LEARNED APPELLATE AUTHORITIES HAS WRONGLY REJECTED THE APPELLANT WRITTEN ARGUMENT WITH FACTS OF THE CASE ALONG WITH THE PROOF AND COPIES OF THE ORDER SHEET AND EVEN THE LEARNED ASSESSING OFFICER NON COMPLIANCE OF THE POINTS NO. 4 ONWARDS OF THE BUSINESS ACTIVITIES UNDER THIS REMAND REPORT AND THE APPELLATE AUTHORITIES HAS EVEN NOT GONE THROUGH THE OLD ORDERS AND NATURE OF THE BUSINESS IN WHICH THE LEARNED ASSESSING OFFICER ACCEPTED THE ACCOUNTS. 3. THAT ONE MORE OPPORTUNITY TO BE GIVEN TO REGULAR VOLUNTARILY, TIMELY AND TRULY FOLLOWING THE INCOME TAX RULES BY THE APPLICANT AND ITS WRONGLY DECLARED THAT THE APPELLANT NOT COOPERATED WITH THE ASSESSMENT PROCEEDINGS. 4. THAT THE ORDER PASSED IS AGAINST THE MERIT CIRCUMSTANCES AND LEGAL ASPECTS OF THE CASE. 5. THAT THE APPELLANT MAY ALLOW TO TAKE ANY OTHER GROUNDS OF APPEAL, IF REQUIRED DURING THE TIME OF HEARING OF THE APPEAL. 6. THAT THE ORDER PASSED IS AGAINST THE MERIT CIRCUMSTANCES AND LEGAL ASPECTS OF THE CASE. 3. THE BRIEF FACTS OF THE CASE THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF RUNNING DIESEL / PETROL PUMP. THE ASSESSEES CASE WAS REOPENED BY REVENUE BASED ON AIR INFORMATION BY INVOKING PROVISIONS OF SECTION 147 OF THE 1961 ACT AND NOTICES U/S 148 WERE ISSUED AS STATED/DETAILED BY THE AO IN THE ASSESSMENT ORDER. THE ITA NO.348/ALLD/2014 ASSESSMENT YEAR: 2009-10 SRI RAMAPATI GUPTA 3 REVENUE HAS COME INTO POSSESSION OF INFORMATION FROM AIR THAT THE ASSESSEE IS HAVING A SAVING BANK ACCOUNT WITH SBI IN WHICH CASH DEPOSIT OF RS. 20,28,000/- WAS DEPOSITED IN CASH DURING THE YEAR UNDER CONSIDERATION , WHICH LED TO INVOCATION OF PROVISIONS OF SECTION 147/148 OF THE 1961 ACT. THE CASE WAS REOPENED TO VERIFY THE GENUINENESS OF THE CASH DEPOSIT. THE ASSESSEE HAS DISPUTED THE SERVICE OF NOTICE U/S 148 AND AN AFFIDAVIT HAS ALSO BEEN FILED BEFORE THE LD. CIT(A) TO THAT EFFECT. AT THE SAME TIME, THE ASSESSEE IS ALSO DISPUTING THAT THE ASSESSEE HAS NOT BEEN GIVEN BY REVENUE COPY OF THE BANK ACCOUNT WITH THE STATE BANK OF INDIA IN WHICH ALLEGEDLY RS.20,28,000/- WAS DEPOSITED IN CASH BY THE ASSESSEE. THE ASSESSEE IS ALSO DISPUTING THE HE IS NOT MAINTAINING THE AFORESAID BANK ACCOUNT WITH SBI. THE AUTHORITIES BELOW HAVE MADE ADDITIONS TO THE INCOME OF THE ASSESSEE OF THE ENTIRE DEPOSITS ( INCLUDING CASH DEPOSITS) IN THE SAID BANK ACCOUNT DURING THE YEAR UNDER CONSIDERATION, TO THE TUNE OF RS. 27,17,779/- . FURTHER IT IS ALSO OBSERVED THAT ADDITIONS HAVE BEEN MADE TO THE INCOME OF THE ASSESSEE BY AUTHORITIES BELOW ON ACCOUNT OF ENHANCEMENT OF GROSS PROFIT RATIO , WHICH HAS BEEN ENHANCED FROM 2.05% DECLARED BY THE ASSESSEE IN THE RETURN OF INCOME FILED WITH REVENUE TO 2.47% BASED ON INCOME OF SIMILAR BUSINESS CARRIED OUT BY OTHER PERSON. THE ASSESSEE HAS NOT PRODUCED BOOKS OF ACCOUNTS BEFORE THE AO WHICH LED TO ADDITION TO THE INCOME OF THE ASSESSEE TO THE TUNE OF RS.6,05,912/- . FURTHER THERE IS DISALLOWANCE OF EXPENSES TO THE TUNE OF RS.4,29,251/- BEING 20% OF THE FOLLOWING EXPENSES AS CLAIMED BY THE ASSESSEE IN P& L ACCOUNT FILED WITH REVENUE , AS UNDER I) GENERATOR EXPENSES 4,66,430/- II) MISC. EXPENSES 7,974/- III) PRINTING & STATIONERY 26,385/- IV) SALARY 7,86,000/- V) STAFF WELFARE 1,05,630/- VI) TANKER EXPENSES 6,81,356/- VII) TELEPHONE 34,021/- VIII) TRAVELLING 38,460/- TOTAL 21,46,256/- ITA NO.348/ALLD/2014 ASSESSMENT YEAR: 2009-10 SRI RAMAPATI GUPTA 4 4. AGGRIEVED BY AN ASSESSMENT ORDER PASSED BY THE AO, THE ASSESSEE FILED FIRST APPEAL WITH LD. CIT(A) , WHO WAS PLEASED TO DISMISS THE APPEAL OF THE ASSESSEE , BY HOLDING AS UNDER: I HAVE PERUSED THE FACTS STATED IN THE ASSESSMENT ORDER , REMAND REPORT OF THE ASSESSING OFFICER AS WELL AS THE FACTS STATED IN THE ASSESSEES SUBMISSION AND REJOINDER, FROM THE REMAND REPORT IT IS EVIDENT THAT THE ASSESSEE WAS AWARE THAT THIS NOTICE WAS ALSO SENT THROUGH REGISTERED POST ON THE ADDRESS OF THE ASSESSEE VIDE POSTAL RECEIPT NO. A RU15895324 1 IN DATED 01.08.2012. ON 08.08.2012, SRI O.P KHANDELWAL, ADVOCATE ATTENDED ON BEHALF OF THE ASSESSEE, FILED WRITTEN REPLY REQUESTING THEREIN ADJOURNMENT OF DATE ON THE GROUND THAT REQUISITE DOCUMENTS WAS NOT AVAILABLE WITH HIM. CASE WAS ADJOURNED FOR 27.08.2012. ON 27.08.2012, COUNSEL OF THE ASSESSEE ATTENDED AND FILED WRITTEN REPLY. IN THE SAID REPLY, IT HAS BEEN STATED THAT THE ASSESSEE HAS NO SAVING BANK ACCOUNT. IF ANY SUCH INFORMATION IS IN THE POSSESSION OF THE DEPARTMENT, THE SAME MAY PLEASE BE PROVIDED TO HIM VIZ FATHER' S NAME AND BANK ACCOUNT NUMBER ETC. KEEPING IN VIEW THE NATURAL JUSTICE. THIS IS TREATED AS NOTICE WAS SERVED BECAUSE ASSESSEES COUNSEL SHRI O.P. KHENDELWAL ATTENDED AND THE CANNOT TAKE THIS PLEA, NOW THEREFORE, THIS LEGAL GROUND DOES NOT HOLD GOOD. HENCE, THIS GROUND OF APPEAL IS BEING DISMISSED. 5. AGGRIEVED BY APPELLATE ORDER PASSED BY LEARNED CIT(A), THE ASSESSEE FILED SECOND APPEAL WITH THE TRIBUNAL. NONE APPEARED ON BEHALF OF THE ASSESSEE WHEN THE APPEAL WAS CALLED FOR HEARING. WE HAVE HEARD LEARNED DR THROUGH VIDEO CONFERENCING MODE. THE LD. DR HAS SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW AND VEHEMENTLY ARGUED FOR SUSTAINING THE ADDITIONS. AFTER PERUSING THE MATERIAL ON RECORD AND HEARING LEARNED DR, WE ARE OF THE CONSIDERED VIEW THAT THE CASE OF THE ASSESSEE WAS REOPENED BY INVOKING PROVISIONS OF SECTION 147/148 OF THE 1961 ACT BASED ON AIR INFORMATION THAT THE ASSESSEE HAS DEPOSITED CASH OF RS. 20,28,000/- IN SAVING BANK ACCOUNT WITH SBI. AS PER AUTHORITIES BELOW, THE SAID SAVING BANK ACCOUNT WAS NOT DISCLOSED BY ASSESSEE TO REVENUE . THE ASSESSEE HAS DENIED THAT HE DID NOT HOLD SUCH BANK ACCOUNT WITH SBI. FURTHER, THE ASSESSEE HAS STATED BEFORE THE AUTHORITIES BELOW THAT THE COPY OF BANK STATEMENTS OF THE SAID BANK ACCOUNT WITH SBI HAS NOT BEEN PROVIDED TO HIM BY REVENUE DESPITE BEING ASKED BY ASSESSEE. THE ASSESSEE HAS ALSO FILED AN AFFIDAVIT BEFORE LEARNED CIT(A) THAT NOTICE U/S 148 WAS NEVER SERVED ON THE ASSESSEE AND THE ITA NO.348/ALLD/2014 ASSESSMENT YEAR: 2009-10 SRI RAMAPATI GUPTA 5 ENTIRE PROCEEDINGS ARE VITIATED . THE ASSESSEE IS CLAIMING BEFORE THE AUTHORITIES BELOW THAT HE HAS MAINTAINED PROPER BOOKS OF ACCOUNTS WITH RESPECT TO BUSINESS CARRIED ON BY HIM, WHILE THE FINDING OF THE AUTHORITIES BELOW IS THAT THE ASSESSEE HAS NOT PRODUCED BOOKS OF ACCOUNTS BEFORE THE AUTHORITIES BELOW. THE ASSESSEE HAS RAISED ONE OF THE GROUNDS OF APPEAL AND PRAYERS ARE MADE IN THE SAID GROUND OF APPEAL THAT ONE MORE OPPORTUNITY BE GRANTED TO THE ASSESSEE SO THAT THE ASSESSEE CAN PARTICIPATE/CO-OPERATE IN PROCEEDINGS BEFORE THE AUTHORITIES BELOW AND EXPLAIN ITS POSITION. THE POWERS OF THE LD. CIT(A) ARE CO-TERMINUS WITH THE POWER OF THE AO . AS IS DISCERNIBLE FROM RECORDS/ORDERS OF THE AUTHORITIES BELOW , THE ASSESSEE HAS NOT ALSO COO-OPERATED WITH THE AUTHORITIES BELOW. THE LEARNED CIT(A) AS COULD BE SEEN ON ITS PART HAS PASSED CRYPTIC ORDER. IN OUR CONSIDERED VIEW AND IN THE FAIRNESS OF THE MATTER AND INTEREST OF JUSTICE , THE ASSESSEE BE GIVEN ONE MORE OPPORTUNITY AND THE MATTER IS RESTORED TO THE FILE OF LEARNED CIT(A) FOR FRESH ADJUDICATION OF APPEAL FILED BY ASSESSEE BEFORE LEARNED CIT(A). THE APPELLATE ORDER DATED 25.03.2014 PASSED BY LEANED CIT(A) IS SET ASIDE. THE REVENUE IS DIRECTED TO PROVIDE COPY OF THE BANK STATEMENT OF SAVING BANK ACCOUNT WITH SBI TO THE ASSESSEE, IN WHICH ALLEGEDLY CASH DEPOSITS OF RS.20,28,000/- WAS MADE BY ASSESSEE DURING THE YEAR UNDER CONSIDERATION , AS ALLEGED BY REVENUE. ALL THE CONTENTIONS ARE KEPT OPEN INCLUDING ADJUDICATING ON THE VALIDITY OF REOPENING OF CONCLUDED ASSESSMENT BY INVOKING PROVISIONS OF SECTION 147/148 OF THE 1961 ACT . HENCE WE ARE RESTORING THE MATTER BACK TO THE FILE OF CIT(A) FOR DENOVO ADJUDICATION OF APPEAL FILED BY ASSESSEE AND THE APPELLATE ORDER DATED 25.03.2014 PASSED BY LEARNED CIT(A) IS SET ASIDE. THE LEARNED CIT(A) IS DIRECTED TO ADJUDICATE ALL THE ISSUES INCLUDING LEGAL ISSUES AS WELL AS ISSUES ON MERITS RAISED BY ASSESSEE. WE MAKE IT CLEAR THAT IF THE ASSESSEE DID NOT COOPERATE BEFORE THE LD. CIT(A) IN DENOVO PROCEEDINGS , THE LEARNED CIT(A) WILL BE AT LIBERTY TO DECIDE THE ISSUES BOTH LEGAL AS WELL AS ON MERITS BASED UPON MATERIAL ON RECORD IN ACCORDANCE WITH LAW. THE LEARNED CIT(A) IS DIRECTED TO ADMIT ALL EVIDENCES FILED BY ASSESSEE IN HIS SUPPORT AND THE SAME BE ADJUDICATED DENOVO ON MERITS IN ACCORDANCE WITH LAW. NEEDLESS TO SAY THAT THE ITA NO.348/ALLD/2014 ASSESSMENT YEAR: 2009-10 SRI RAMAPATI GUPTA 6 LEARNED CIT(A) SHALL PROVIDE PROPER AND ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN ACCORDANCE WITH PRINCIPLES OF NATURAL JUSTICE IN ACCORDANCE WITH LAW, IN DENOVO PROCEEDINGS AS DIRECTED BY US THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. WE ORDER ACCORDINGLY. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE WITH TRIBUNAL IN ITA NO. 348/ALLD./2014 FOR AY: 2009-10 IS ALLOWED FOR STATISTICAL PURPOSES, AS INDICATED ABOVE. ORDER PRONOUNCED ON 27/11/2020 AT ALLAHABAD SD/- SD/- [VIJAY PAL RAO] [RAMIT KOCHAR] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 27/11/2020 BISWAJIT COPY FORWARDED TO: 1. APPELLANT SRI RAMAPATI GUPTA. 2. RESPONDENT - ITO, PRATAPGARH 3. CIT(A) - 4. CIT 5. DR - BY ORDER ASSISTANT REGISTRAR