Aruna Singireddy , Hyderabad V. Income Tax Officer, Ward-11(4), Hyderabad

ITA 350/Hyd/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 2026 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 1 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-A
• Next Hearing Date: 11-03-2020
• Assessment Year: 2014-2015
• Appeal Filed On: 15-03-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NILANJAN DEY
• Assessee Lawyers: D V ANJANEYULU
• Keywords: Principle of natural justice; Tax effect
• Section: 133(6)

Judgement Text

IN THE INCOME TAX A PPELLATE TRIBUNAL HYDERABAD BENCH SMC', HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER ITA NO. 350/HYD/2019 ASSESSMENT YEAR: 2014-15 ARUNA SINGIREDDY, HYDERABAD. PAN BOPPS 4356R VS. INCOME-TAX OFFICER, WARD 11(4), HYDERABAD. A PPELLANT RESPONDENT ASSESSEE BY: S HRI D.V. ANJANEYULU REVENUE BY: S HRI NILANJAN DEY DATE OF HEARING: 11 / 0 3 / 20 20 DATE OF PRONOUNCEMENT: 29 / 0 4 /20 20 O R D E R THIS IS ASSESSEES APPEAL FOR THE AY 2009-10 AGAINS T THE ORDER OF CIT(A) 1, HYDERABAD, DATED 22/01/20 19 WHEREIN IT WAS SUBMITTED THAT THE ORDER OF CIT(A) W AS EX- PARTE-QUA-ASSESSEE AND, THEREFORE, PRAYED FOR REMAN D THE MATTER TO THE FILE OF AO. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE, A N INDIVIDUAL, FILED HER RETURN OF INCOME FOR THE AY 2 014-15 ON 12/02/2016 ADMITTING AN INCOME OF RS. 2,05,500/-, I .E., INCOME FROM HOUSE PROPERTY OF RS. 1,57,500/- AND INCOME FR OM OTHER SOURCES OF RS. 48,000/-. DURING THE COURSE OF ASSES SMENT PROCEEDINGS U/S.143(3) OF THE ACT, THE AO NOTICED T HAT THE ASSESSEE HAD MADE CERTAIN FIXED DEPOSITS WITH THE A DARSH COOPERATIVE URBAN BANK LTD. AND DERIVED INTEREST OF RS. 2,39,152/-, THEREFROM BUT, HAS NOT ADMITTED THE SAM E TO TAX. I.T.A. NO. 350/HYD/19 ARUNA SINGIREDDY 2 2.1 THE ASSESSEE WAS THEREFORE ASKED TO SHOW CAUSE FOR NOT ADMITTING THE ABOVE INTEREST. THE ASSESSEE FIL ED A LETTER STATING AS UNDER: WITH REFERENCE TO THE ABOVE CITED SUBJECT, I WOULD LIKE TO SUBMIT FOR YOUR CONSIDERATION THAT I HAVE BEEN FILI NG IT RETURNS FOR THE LAST 10 YEARS AND DURING THE FINANCIAL 2013 -14 I FILED MY RETURN OF INCOME INCLUDING INTEREST OF RS.48,000 /- ON RS.4,00,000/- @ 12% PER ANNUM WHICH IS NOT THE SUBJ ECT MATTER OF MISMATCH. BASICALLY WE ARE FROM AGRICULTURE FAMILY HAVING ANC ESTRAL PROPERTY IN THE FORM OF AGRICULTURE LAND ABOUT ACRE 16.19 GUNTAS. OUR HUF HAS INVESTED RS.22.00 LAKHS ON MY NAME IN M/S.ADARSH CO-OPERATIVE BANK, HYDERABAD AND EARNED INTEREST OF RS.2,23,321/- OUT OF THIS TOTAL INVESTM ENT MY ACCOUNT IS RS.4,00,000/-, SO I EARNED INCOME OF RS. 48,000/- AND SHOWN IN MY RETURN AND THE BALANCE AMOUNT BELON GS TO OUR HUF. HENCE, I HAVE NOT SHOWN IN MY RETURN OF I NCOME. THE RELEVANT DOCUMENTS ARE HEREWITH ENCLOSED FOR YO UR INFORMATION AND RECORD. THE AO, HOWEVER, DID NOT ACCEPT THE ASSESSEES CONT ENTION AND HELD THAT THE ASSESSEES HUSBAND HAS ALSO GIVEN SIMILAR EXPLANATION IN HIS ASSESSMENT AND THAT THEY HAVE CL AIMED THAT THE SOURCES FOR THE DEPOSITS WERE OUT OF AGRICULTUR AL INCOME OF HUF. THE AO OBSERVED THAT THE ASSESSEE HAS BEEN FIL ING RETURNS OF INCOME ADMITTING INCOME ONLY FROM HOUSE PROPERTY AND HAD NEVER OFFERED INTEREST INCOME TO TAX. THER EFORE, HE DISBELIEVED THE ASSESSEES CLAIM OF SOURCE FOR THE INVESTMENTS AS OUT OF AGRICULTURAL INCOME OF THE ASSESSEE. HE, THEREFORE, MADE THE ADDITION OF RS. 2,39,152/-. 2.2 FURTHER, THE AO ALSO NOTICED THAT THE ASSESSEE HAS REPAID A MORTGAGE LOAN AMOUNTING TO RS. 10,00,786/- ON 17/08/2013. WHEN THE ASSESSEE WAS ASKED TO FURNISH THE SOURCE FOR THE REPAYMENT OF THE SAID LOAN WITH EVID ENCE, THE ASSESSEE SUBMITTED THAT SHE WAS HAVING OD FACILITY WITH THE BANK BUT WAS NOT USING IT DUE TO LACK OF BUSINESS, AND THE I.T.A. NO. 350/HYD/19 ARUNA SINGIREDDY 3 SAME WAS USED BY HER COUSIN, SHRI PARASURAM REDDY F OR HIMSELF AND HE HAD CLOSED LOAN ACCOUNT ALONG WITH I NTEREST WITH HIS FUNDS DUE TO PRESSURE FROM THE BANKER TO C LOSE THE ACCOUNT. THE AO DID NOT ACCEPT THIS CONTENTION OF T HE ASSESSEE SINCE THERE WAS NO CONFIRMATION LETTER FRO M SHRI PARASURAM REDDY AND, THEREFORE, HE TREATED THE SAID SUM OF RS. 10,00,786/- AS UNEXPLAINED U/S.68 AND BROUGHT I T TO TAX. 3. AGGRIEVED, THE ASSESSEE PREFERRED AN APPEAL BEFO RE THE CIT(A), WHO CONFIRMED THE ORDER OF THE AO SINCE NON E APPEARED FOR THE ASSESSEE AND THE ASSESSEE IS IN SE COND APPEAL BEFORE THE TRIBUNAL BY RAISING THE FOLLOWING GROUNDS OF APPEAL: 1. THE ORDER OF LD. CIT(A) IS ERRONEOUS IN LAW, CON TRARY TO THE FACTS, PROBABILITIES OF THE CASE AND AGAINST TO THE PRINCIPLES OF EQUITY AND NATURAL JUSTICE. GENERAL I N NATURE, NO TAX EFFECT. 2. THE LD. CIT(A) ERRED IN SIMPLY RELYING ON REMAND REPORT OF AO WHICH IS WITHOUT EXAMINING AND VERIFYI NG THE DOCUMENTS FORWARDED BY CIT(A) CALLING FOR COMMENTS/OBJECTIONS AND WITHOUT INVOKING PROVISIONS OF SECTION 133(6) OR 131 OF THE ACT TO EXAMINE THE PER SON WHO DISCHARGED THE LOAN WHICH IS GERMANE TO SUBJECT MATTER OF APPEAL AND THEREFORE ADDITIONS SHALL BE DELETED. LEGAL GROUND, NO TAX EFFECT. 3. THE ORDER OF LD. CIT(A) IN ALLEGING THAT APPELLA NT HAS NOT APPEARED FOR HEARING ON 16.01.2019 WHERE IN FAC T NO SUCH HEARING NOTICE WAS RECEIVED BY THE APPELLANT W HICH WAS STATED TO BE SENT THROUGH EMAIL WITHOUT SPECIFY ING THE EMAIL ID TO WHICH SUCH NOTICE WAS SENT AND DISMISSING THE APPEAL ON THAT BASIS IS BAD IN LAW A ND CONTRARY TO PRINCIPLES OF JUSTICE, EQUITY AND GOOD CONSCIENCE AND THEREFORE ADDITIONS SHALL BE DELETED . LEGAL GROUND, NO TAX EFFECT. 4. SUBJECT TO ABOVE, LD. CIT(A) FAILED TO APPRECIAT E THE SUBSTANTIAL MATERIAL EVIDENCE PRODUCED IN THE COURS E OF APPEAL PROCEEDINGS IN THE FORM OF WRITTEN SUBMISSIO NS ALONG WITH SUPPORTING DOCUMENTS SUCH AS AFFIDAVIT, IT RETURNS, AGRICULTURAL LAND HOLDINGS OF THE PERSON W HO DISCHARGED THE LOAN AMOUNTING TO RS. 10,00,786/- WH ICH I.T.A. NO. 350/HYD/19 ARUNA SINGIREDDY 4 WAS NOT CONSIDERED BY AO EVEN IN THE REMAND REPORT WHO REITERATED HIS SUBMISSIONS STATED IN THE ASSESS MENT ORDER AND THEREFORE SHALL BE DELETED. TAX EFFECT, R S. 3,33,595/-. 5. LD. CIT(A) FURTHER ERRED IN LAW BY SUSTAINING TH E ADDITION MADE BY AO OF RS.2,39,152/- BEING INTEREST EARNED BY HUF OF APPELLANT'S HUSBAND WHICH IS SUPPORTED BY DOCUMENTARY EVIDENCE LIKE LETTER RECEI VED FROM BANK, IN THE HANDS OF APPELLANT. TAX EFFECT, R S. 79,717/-. 6. FOR THESE AND OTHER REASONS THAT MAY BE URGED AT THE TIME OF HEARING, THE APPELLANT PRAYS THE HONORABLE TRIBUNAL TO KINDLY DELETE THE ADDITIONS MADE BY AO AND SUSTAINED BY HON'BLE CIT(A). GENERAL IN NATURE, NO TAX EFFECT. 4. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAS ALL THE RELEVANT EVIDENCES AND HAS FIL ED THE SAME BEFORE THE AO AND THE CIT(A), BUT, THEY HAVE N OT BEEN CONSIDERED PROPERLY. HE HAS ALSO REFERRED TO THE AF FIDAVIT OF SHRI PARASURAM REDDY AND ALSO THE INTEREST CERTIFIC ATES FOR FDS FILED BY THE ASSESSEE. HE SUBMITTED THAT THE FD S HAVE BEEN MADE IN THE EARLIER AYS AND THEREFORE, THE SOU RCE OF SUCH FDS MAY NOT BE EXAMINED IN THE AY UNDER CONSID ERATION. HE, THEREFORE, PRAYED THAT THE MATTER MAY BE REMAND ED TO THE AO FOR RECONSIDERATION. 5. THE LD. DR, HOWEVER, SUPPORTED THE ORDERS OF REV ENUE AUTHORITIES. 6. HAVING REGARD TO THE RIVAL CONTENTIONS AND MATER IAL ON RECORD, I FIND THAT THE ASSESSEE HAS FILED RELEVANT DETAILS BEFORE THE AO AS WELL AS CIT(A), BUT, THE CIT(A) HA S CONFIRMED THE ORDER OF THE AO ONLY BECAUSE THE ASSE SSEE HAS NOT APPEARED BEFORE HIM. SINCE THE MATERIAL EVIDENC E FILED BY THE ASSESSEE NEEDS REVERIFICATION, I DEEM IT FIT AN D PROPER TO I.T.A. NO. 350/HYD/19 ARUNA SINGIREDDY 5 REMAND THE MATTER TO THE FILE OF THE AO FOR DE-NOVO CONSIDERATION IN ACCORDANCE WITH LAW AFTER GIVING A SSESSEE A FAIR OPPORTUNITY OF HEARING. THE ASSESSEE ALSO IS D IRECTED TO COOPERATE WITH THE AO FOR SPEEDY COMPLETION OF THE ASSESSMENT. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 29 TH APRIL, 2020. SD/- (P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD, DATED 29 TH APRIL, 2020. KV COPY FORWARDED TO: 1. SMT. ARUNA SINGIREDDY, M/S ANJANEYULU & CO., CAS, 30, BHAGYALAKSHMI NAGAR, GANDHI NAGAR, HYD 500 080 2 . ITO, WARD 1 1(4) , HYDERABAD 3 . CIT(A) - 1 HYDERABAD. 4. 5. PR. CIT - 1, HYDERABAD. THE DR, ITAT, HYDERABAD 6 . GUARD FILE