Sh. Mahesh Chand Gupta, New Delhi V. ITO, New Delhi

ITA 3512/DEL/2016

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 4171 (ITAT-DELHI)
• Duration Of Justice: 4 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-10-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 2
• Next Hearing Date: 05-10-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 14-06-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ASHISH CHADHA
• Keywords: Opportunity of being heard; Principle of natural justice; Peak credit
• Section: 68; 144; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SMC NEW DELHI BEFORE SHRI H. S. SIDHU, JUDICIAL MEMBER I.T.A. NO. 3512/DEL/2016 ASSESSMENT YEAR: 2009-10 SH. MAHESH CHAND GUPTA, VS. ITO, WARD-47(2) FLAT NO. UG-3, RZF-1/25/B, NEW DELHI GALI NO.1, MAHAVIR ENCALVE, PALAM NEW DELHJI 110 045 (PAN: AILPG9367M) (ASSESSEE) (RESPONDENT) ASSESSEE BY : SH. VED JAIN, ADV. & SH. ASHISH CHADHA, ADV. REVENUE BY : SH. ANIL SHARMA, SR. DR DATE OF HEARING ON : 05/10/2016 ORDER PRONOUNCED ON : 14/10/20 16 ORDER THIS APPEAL IS FILED BY ASSESSEE AGAINST THE ORDER DATED 09.2.2016 PASSED BY THE LD. CIT(A)-21, NEW DELHI RE LATING TO ASSESSMENT YEAR 2009-10 ON THE FOLLOWING GROUNDS:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) [CIT(A)] HAS ERRED, BOTH ON FACTS AND IN LAW IN UPHOLDING THE ADDITIONS MADE BY THE AO. 2. (I) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN UPHOLDING THE ASSESSMENT ORDER PASSED BY THE AO U/S 144 OF 2 THE ACT, WHICH IS AGAINST THE PRINCIPLES OF NATURAL JUSTICE, AS NO ADEQUATE OPPORTUNITY OF BEING HEARD WAS ALLOWED TO THE ASSESSEE BE THE AO. (II) THAT THE LEARNED CIT(A) HAS UPHELD THE ORDE R OF THE AO WITHOUT CONSIDERING FACT THAT THE NON- APPEARANCE OF THE ASSESSEE BEFORE THE AO WAS BECAUSE OF REASONS BEYOND THE-CONTROL OF THE ASSESSEE. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS GROSSLY ERRED IN NOT GIVING HIS FINDINGS WITH REGARD TO THE SUBMISSIONS MADE BY THE ASSESSEE AND ISSUE INVOLVED IN THE APPEAL BEFORE HIM. 4. (I) ON THE FACTS AND CIRCUMSTANCES OF THE 'CASE, THE LEARNED CIT(A) HAS ERRED, BOTH ON FACTS AND IN LAW, IN CONFIRMING THE ADDITION OF RS.22,52,450/- MADE BY THE AOON ACCOUNT OF THE CASH DEPOSITS MADE BY THE ASSESSEE IN ITS BANK ACCOUNT DURING THE YEAR. (II) THAT THE LEARNED CIT(A) HAS ERRED IN SUSTAINING THE ABOVE ADDITION BY ARBITRARILY REJECTING THE EXPLANATIONS AND EVIDENCES BROUGHT ON RECORD BY THE ASSESSEE. 5. (I) ON THE FACTS AND CIRCUMSTANCES OF THE C ASE, THE LEARNED CIT(A) HAS ERRED, BOTH ON FACTS AND IN LAW IN CONFIRMING THE ADDITION MADE BY THE AO DESPITE THE FACT THAT THE BURDEN AS CONTEMPLATED UNDER SECTION 68 OF THE ACT ABOUT THE NATURE AND SOURCE OF THE DEPOSIT HAS BEEN EXPLAINED BY THE ASSESSEE, 3 (II) WITHOUT PREJUDICE TO THE ABOVE, THE LEARNED CIT(A) HAS ERRED, BOTH ON FACTS AND IN LAW IN DISREGARDING THE FACT THAT ADDITION MADE SHOULD BE RESTRICTED TO THE AMOUNT OF PEAK BALANCE OUT OF THE ALLEGED UNEXPLAINED CASH DEPOSITS MADE IN THE BANK ACCOUNT. 2. FACTS NARRATED BY THE REVENUE AUTHORITIES ARE NO T DISPUTED BY BOTH THE PARTIES, HENCE, THE SAME ARE NOT REPEATED HERE FOR THE SAKE OF CONVENIENCE. 3. AT THE TIME OF HEARING, LD. COUNSEL OF THE ASS ESSEE HAS STATED THAT AO HAS PASSED THE ASSESSMENT ORDER U/S. 144 OF THE INCOME TAX ACT, 1961, WHICH IS AGAINST THE PRINCIPLES OF NATUR AL JUSTICE, AS NO ADEQUATE OPPORTUNITY OF BEING HEARD WAS ALLOWED TO THE ASSESSEE BY THE AO. HE FURTHER STATED THAT LD. CIT(A) HAS ALSO WRONGLY UPHELD THE ACTION OF THE AO WITHOUT CONSIDERING THE FACT THAT THE NON-APPEARANCE OF THE ASSESSEE BEFORE THE AO WAS BECAUSE OF THE RE ASONS BEYOND THE CONTROL OF THE ASSESSEE. HE FURTHER STATED THAT LD . CIT(A) HAS SUSTAINED THE ADDITION AND HAS NOT GIVEN ANY REASON ING FOR NOT ACCEPTING THE SUBMISSIONS OF THE ASSESSEE HAS ROUGH LY HELD THAT THE ASSESSEE HAS NOT BEEN ABLE TO ESTABLISH THE NATURE AND SOURCE OF CASH DEPOSITS. THEREFORE, HE REQUESTED THAT THE ADDITIO N IN DISPUTE MAY BE DELETED. 4. ON THE CONTRARY, LD. DR RELIED UPON THE ORDERS O F THE AUTHORITIES BELOW AND OPPOSED THE REQUEST OF THE ASSESSEES COU NSEL. 4 5. I HAVE HEARD BOTH THE PARTIES AND CAREFULLY GONE THROUGH THE ORDERS PASSED BY THE AUTHORITIES BELOW. I FIND TH AT AO IN HIS ORDER HAS OBSERVED THAT NONE ATTENDED NOR DID FILE ANY AD JOURNMENT LETTER AND ALSO HAS NOT FILED ANY SUPPORTING DOCUMENTS TO OFFER FOR EXPLAINING THE SOURCE OF CASH DEPOSIT OF RS. 22,52, 450/-; ASSESSEE HAS FAILED TO COMPLY SHOW CAUSE NOTICES ISSUED FROM TIM E TO TIME, WHICH REVEALS THAT THE ASSESSEE IS NOT INTERESTED IN COMP LETING THE ASSESSMENT PROCEEDINGS. THEREFORE, AO FINALLY HELD THAT HE HAS NO OTHER ALTERNATIVE BUT TO COMPLETE THE ASSESSMENT PR OCEEDINGS ON THE BASIS OF MATERIAL AVAILABLE ON RECORD AND ACCORDING LY CASH DEPOSIT OF RS. 22,52,450/- WAS ADDED IN THE HANDS OF THE ASS ESSEE U/S. 68 OF THE I.T. ACT. HOWEVER, LD. CIT(A) VIDE PARA NO. 6 . AT PAGE NO. 7 TO 8 OF THE IMPUGNED ORDER HAS OBSERVED THAT DURING THE COU RSE OF APPELLATE PROCEEDINGS THE APPELLANT HAS CLAIMED THAT IN RESPO NSE TO NOTICE U/S. 143(2) OF THE I.T. ACT HE HANDED OVER HIS CASE TO T HE CHARTERED ACCOUNTANT, WHO DID NOT ATTEND THE PROCEEDINGS WHIC H LED TO FINALIZATION OF THE ASSESSMENT U/S. 144. LD. CIT(A ) ALSO HELD THAT THE CLAIM MADE BY THE ASSESSEE IS NOT SUPPORTED BY ANY EVIDENCE AND AS SUCH HE FINDS NO INFIRMITY IN AO INVOKING PROVISION S OF SECTION 144 OF THE ACT AND COMPLETED THE ASSESSMENT VIDE ORDER DAT ED 21.12.2011. IN VIEW OF THE ABOVE, I AM OF THE CONSIDERED VIEW T HAT IN THE INTEREST OF JUSTICE, ONE MORE OPPORTUNITY MAY BE GRANTED TO THE ASSESSEE TO SUBSTANTIATE HIS CLAIM BEFORE THE AO. ACCORDINGLY, I REMIT BACK THE 5 ISSUES IN DISPUTE TO THE FILE OF THE AO TO CONSIDE R THE SAME AFRESH, UNDER THE LAW, AFTER GIVING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. HOWEVER, THE ASSESSEE IS ALSO DIRECTED T O PRODUCE ALL THE EVIDENCES/ DOCUMENTS BEFORE THE AO TO SUBSTANTIATE HIS CLAIM AND FULLY COOPERATE WITH THE AO DURING THE PROCEEDINGS. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 14/10/2016 . SD/- [H.S. SIDHU] JUDICIAL MEMBER DATE 14/10/2016 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES 6