Mr. Rakesh Kumar Gupta, New Delhi V. ITO, New Delhi

ITA 359/DEL/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 3525 (ITAT-DELHI)
• Duration Of Justice: 9 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 04-05-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 23-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KAUSHLENDRA TIWARI
• Keywords: Period of limitation
• Section: 142(1); 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES SMC : DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA.NO.359/DEL./2017 ASSESSMENT YEAR 2011-2012 SHRI RAKESH KUMAR GUPTA, 101, AMAN CHAMBER, 47/21, OLD RAJINDER NAGAR, NEW DELHI 110 060. PAN AAGPG6517Q VS. THE INCOME TAX OFFICER, WARD-27(3) NEW DELHI. (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI SALIL AGGARWAL, ADVOCATE. SHRI SHAILESH GUPTA, ADVOCATE. FOR REVENUE : SHRI KAUSHLENDRA TIWARI, SR. D.R. DATE OF HEARING : 30.10.2017 DATE OF PRONOUNCEMENT : 06 .11.2017 ORDER THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-14, NEW DELHI, DATED 10 TH NOVEMBER, 2016 FOR THE A.Y. 2011-2012 ON THE FOLLOWING GROUNDS : 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEA LS) HAS ERRED BOTH IN LAW AND ON FACTS IN CONFIRMING TH E ADDITION OF RS.8,00,000/- ON ACCOUNT OF INVESTMENT IN M/S UN ITECH LIMITED, SIGNATURE TOWER, SOUTH CITY, GURGAON. THE LEARNED 2 ITA.NO.359/DEL./2017 SHRI RAKESH KUMAR GUPTA, NEW DELHI. A.O. AS WELL AS CIT(A) HAS NOT LOOKED INTO THE DOCU MENTARY EVIDENCE FILED BY THE ASSESSE DURING THE COURSE OF PROCEEDINGS. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) HAS ERRED BOTH IN LAW AND ON FACTS IN CONFIRMING TH E ENHANCEMENT OF PROFIT SHOWN AT RS.1,58,879/- TO RS.10,25,000/- ON ESTIMATED BASIS ON SALES OF RS.1,28,14,983/- BY TAKING THE RATE OF PROFIT @ 8% OF THE SALES. THE LEARNED A.O. HAD MADE THE ADDITION AT THE RATE OF 10% OF THE SALES OF RS.1,28,14,983/-. THE ADDITION MADE ON ESTIMATED BASIS IS HIGHLY UNJUSTIFIED AND REJECTION OF BOOKS OF ACCOUNT WITHOUT FINDING ANY DISCREPANCY IN PURCHASE OR SALE S, WAS NOT CALLED FOR. 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) HAS ERRED BOTH IN LAW AND ON FACTS IN CONFIRMING TH E ADDITION OF RS.8,18, 495/- ON ACCOUNT OF UNSECURED LOAN RECE IVED FROM MR.DUSHYANT. THE LEARNED A.O. AS WELL AS LEARNED CI T(A) HAS NOT LOOKED INTO THE DOCUMENTARY EVIDENCE FILED DURI NG THE COURSE OF PROCEEDINGS. 3 ITA.NO.359/DEL./2017 SHRI RAKESH KUMAR GUPTA, NEW DELHI. 1.1. ON EARLIER DATE WHEN APPEAL WAS TAKEN-UP FOR HEARING, ASSESSEE FILED ADDITIONAL GROUND OF APPEAL CHALLENG ING THE ASSESSMENT ORDER DATED 29 TH MARCH, 2014 PASSED BY THE A.O. WITHOUT JURISDICTION AND VOID-AB-INITIO AND IS LIABLE TO BE QUASHED, AS NO NOTICE UNDER SECTION 143(2) OF THE ACT WAS IS SUED AND SERVED WITHIN THE TIME PRESCRIBED UNDER THE ACT. ON 29 TH AUGUST, 2017, THE SMC BENCH CONSIDERING THE ADDITIONAL GROUND OF APPEAL NOTED THAT THE ADDITIONAL GROUND SO RAISED IS LEGAL IN NA TURE AND HENCE, ADMITTED. THE LD. D.R. WAS DIRECTED TO PLACE ON REC ORD THE EVIDENCE OF SERVICE OF NOTICE UNDER SECTION 143(2) OF THE I. T. ACT. THE APPEAL WAS ADJOURNED TO 30 TH OCTOBER, 2017. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT T HE ASSESSEE FILED RETURN OF INCOME AT RS.1,58,880 ON 30 TH SEPTEMBER, 2011. THE CASE WAS SELECTED FOR SCRUTINY BY ISSUING NOTICE UNDER S ECTION 143(2) OF THE I.T. ACT DATED 07 TH SEPTEMBER, 2012 FIXING THE HEARING OF THE CASE ON 18 TH SEPTEMBER, 2012. THIS NOTICE WAS SENT THROUGH SPEE D POST. DETAILED QUESTIONNAIRE WERE ISSUED TO THE ASS ESSEE ON 09 TH JANUARY, 2013. SUBSEQUENTLY, VARIOUS NOTICES WERE I SSUED UNDER SECTION 143(2)/142(1) FROM TIME TO TIME. BUT, ACCOR DING TO A.O, THE 4 ITA.NO.359/DEL./2017 SHRI RAKESH KUMAR GUPTA, NEW DELHI. ASSESSEE HAS AVOIDED ALL THE NOTICES AND DID NOT FI LE ANY REPLY. THE A.O. ULTIMATELY, COMPUTED THE INCOME OF ASSESSEE AT RS.28,99,990 BY MAKING THE ADDITIONS OF RS.11,22,619, RS.8 LAKHS AND RS.8,18,495. THE APPEAL OF ASSESSEE WAS PARTLY ALLO WED BY THE LD. CIT(A). 3. THE LEARNED COUNSEL FOR THE ASSESSEE CONTEN DED THAT AS PER PROVISO TO SECTION 143(2) RELEVANT TO THE ASSES SMENT YEAR UNDER APPEAL, NO NOTICE UNDER THIS CLAUSE SHALL BE SERVED ON THE ASSESSEE AFTER THE EXPIRY OF SIX MONTHS FROM THE END OF THE FINANCIAL YEAR IN WHICH THE RETURN IS FURNISHED. HE HAS SUBMITTED THA T SINCE RETURN WAS FILED ON 30 TH SEPTEMBER, 2011, THEREFORE, NOTICE UNDER SECTION 143(2) WOULD BE SERVED UPON THE ASSESSEE TILL 30 TH SEPTEMBER, 2012. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED TH AT NO NOTICE UNDER SECTION 143(2) HAVE BEEN SERVED UPON THE ASSE SSEE. THEREFORE, ASSESSMENT IS BAD IN LAW AND IS LIABLE T O BE QUASHED. LEARNED COUNSEL FOR THE ASSESSEE POINTED OUT THAT A SSESSMENT IN THIS CASE HAS BEEN FRAMED AT THE ADDRESS AT 434, ME ERA BAGH, NEW DELHI. INTIMATION UNDER SECTION 143(1) FOR ASSESSME NT YEAR UNDER APPEAL I.E., 2011-2012 HAVE BEEN ISSUED AT 13/1/4, EMILIA VATIKA 5 ITA.NO.359/DEL./2017 SHRI RAKESH KUMAR GUPTA, NEW DELHI. CITY, SECTOR-49, GURGAON, HARYANA-122018 (PAPER BOO K-1). HE HAS SUBMITTED THAT NOTICE DATED 08 TH OCTOBER, 2013 HAVE BEEN ISSUED TO THE ASSESSEE ON 295, V & POKAPASHERA, NEW DELHI . THE LEARNED COUNSEL FOR THE ASSESSEE THEREFORE, SUBMITTED THAT SINCE NO NOTICE UNDER SECTION 143(2) HAVE BEEN SERVED UPON THE ASSE SSEE WITHIN THE PERIOD OF LIMITATION, THEREFORE, PROCEEDING MAY BE QUASHED. HE HAS SUBMITTED THAT MERE ISSUANCE OF NOTICE UNDER SE CTION 143(2) OF THE ACT, DOES NOT TANTAMOUNT TO SERVICE OF NOTICE A ND THE REQUIREMENT OF LAW IS THE SERVICE OF NOTICE AND N OT MERELY ISSUANCE OF NOTICE AND RELIED UPON THE DECISION IN THE CASE OF ACIT VS. HOTEL BLUE MOON 321 ITR 362. HE HAS ALSO RELIED UPON THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CAS E OF CIT VS. CHETAN GUPTA 382 ITR 613 IN WHICH IT WAS HELD THAT BURDEN IS ON THE REVENUE TO ESTABLISH THE SERVICE OF NOTICE AND NO MATERIAL HAS BEEN BROUGHT FORWARD IN THE IMPUGNED MATTER TO SUGG EST THE SERVICE OF THE NOTICE UNDER SECTION 143(2) OF THE I .T. ACT. 4. ON THE OTHER HAND, THE LD. D.R. FILED THE COPIES OF THE NOTICE UNDER SECTION 143(2) DATED 07 TH SEPTEMBER, 2012 ALONG WITH ADDRESS OF THE ASSESSEE AS PER DATA BASE AND RETURN FILED ALONG WITH 6 ITA.NO.359/DEL./2017 SHRI RAKESH KUMAR GUPTA, NEW DELHI. COPIES OF THE ORDER SHEET. THE LD. D.R. RELIED UPON THE DECISIONS OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. MADHSY FILMS (P.) LTD., (2008) 301 ITR 69 (DEL.) AND CIT VS. YAM U INDUSTRIES LTD., (2008) 306 ITR 309 (DEL.) IN WHICH IT WAS HELD THAT WHERE NOTICE ISSUED TO THE ASSESSEE UNDER SECTION 143(2) HAD BEE N DISPATCHED BY SPEED POST AT THE ADDRESS GIVEN IN THE RETURN AN D SAME HAD NOT BEEN RETURNED BACK, IT WOULD BE PRESUMED THAT IT HA D REACHED THE ASSESSEE AND DULY SERVED UPON THE ASSESSEE WITHIN T HE PERIOD OF LIMITATION. THE LD. D.R. THEREFORE, SUBMITTED THAT ADDITIONAL GROUND MAY BE DISMISSED. 5. I HAVE CONSIDERED THE RIVAL CONTENTIONS. TH E ASSESSEE FILED RETURN OF INCOME ON 30 TH SEPTEMBER, 2011. THEREFORE, ACCORDING TO PROVISO TO SECTION 143(2) OF THE I.T. ACT AS RELEVANT TO ASSESSMENT YEAR UNDER APPEAL, NO NOTICE UNDER THIS CLAUSE SHALL BE SERVED ON THE ASSESSEE AFTER THE EXPIRY OF SIX M ONTHS FROM THE END OF THE FINANCIAL YEAR IN WHICH THE RETURN IS FU RNISHED. THEREFORE, THE NOTICE UNDER SECTION 143(2) COULD BE SERVED UPON THE ASSESSEE LATEST BY 30 TH SEPTEMBER, 2012. LD. D.R. FILED COPY OF THE NOTICE DATED 07 TH SEPTEMBER, 2012 IN WHICH THE ADDRESS OF THE 7 ITA.NO.359/DEL./2017 SHRI RAKESH KUMAR GUPTA, NEW DELHI. ASSESSEE HAS BEEN GIVEN AS 290, V & PO-KAPASHERA, N EW DELHI. HOWEVER, IN THE INTIMATION ISSUED UNDER SECTION 143 (1), THE ADDRESS OF THE ASSESSEE HAS BEEN GIVEN AS 13/1/4, E MILIA VATIKA CITY, SECTOR-49, GURGAON, HARYANA-122018. THE ASSES SMENT ORDER, HOWEVER, IS PASSED AT THE ADDRESS OF ASSESSEE AT 43 4, MEERA BAGH, NEW DELHI. THE LD. D.R. ALSO FILED ADDRESS OF THE A SSESSEE AS PER PAN DATA BASE I.E., AT 295, V & PO-KAPASHERA, NEW D ELHI AND AS PER THE RETURN, THE ADDRESS OF THE ASSESSEE IS 290, V & PO- KAPASHERA, NEW DELHI. THE A.O. IN THE ASSESSMENT OR DER HAS MENTIONED THAT NOTICE DATED 07 TH SEPTEMBER, 2012 HAVE BEEN ISSUED TO THE ASSESSEE FIXING HEARING ON 18 TH SEPTEMBER, 2012 THROUGH SPEED POST. HOWEVER, THE A.O. HAS NOT MENTI ONED IN THE ASSESSMENT ORDER WHETHER THE SAID ENVELOPE CONTAINI NG THE NOTICE HAD BEEN SERVED UPON THE ASSESSEE OR HAD BEEN RECEI VED BACK UNSERVED. NO ORDER SHEET FOR 18 TH SEPTEMBER, 2012 ON WHICH DATE THE COMPLIANCE IS TO BE MADE BY THE ASSESSEE HAS BE EN RECORDED BY THE A.O. COPY OF THE ORDER SHEET FILED ON RECORD SU GGESTS THAT AFTER 07 TH SEPTEMBER, 2012, A.O. DID NOT RECORD ANY ORDER SHE ET ON 18 TH SEPTEMBER, 2012. THE A.O. THEREAFTER, RECORDED ORDE R SHEET ON 24 TH 8 ITA.NO.359/DEL./2017 SHRI RAKESH KUMAR GUPTA, NEW DELHI. SEPTEMBER, 2012 AND ON THAT DATE A.O. ISSUED NOTICE UNDER SECTION 143(2) TO THE ASSESSEE AT THE ANOTHER ADDRESS OF AS SESSEE AT SOHNA ROAD, GURGAON AND FIXED THE CASE FOR COMPLIANCE ON 28 TH SEPTEMBER, 2013. THEREAFTER, NO ORDER SHEET ON 28 TH SEPTEMBER, 2013 HAVE BEEN RECORDED. THEREAFTER, A.O. STRAIGHTA WAY RECORDED THE ORDER SHEET ON 26 TH AUGUST, 2013 ISSUING NOTICE UNDER SECTION 143(2) AND 142(1) FOR 11 TH SEPTEMBER, 2013 AND NOTICES UNDER SECTION 133(6) TO AUDITOR FOR 09.09.2013. THEREAFTE R, ORDER SHEET ON 08.10.2013 HAVE BEEN RECORDED TO ISSUE NOTICE UN DER SECTION 143(2) AND 142(1) FOR 14.10.2013, BY THAT THESE LIM ITATION EXPIRED ON 30.09.2012. THESE FACTS CLEARLY SHOW THAT A.O. D ID NOT RECORD ANYTHING IN THE ORDER SHEET ABOUT THE SERVICE OF TH E NOTICE UNDER SECTION 143(2) AGAINST THE ASSESSEE AND NO SUCH FAC T HAS BEEN RECORDED IN THE ASSESSMENT ORDER AS WELL. THE A.O. HAS ISSUED NOTICE TO THE ASSESSEE AT DIFFERENT ADDRESSES. NOTI CE DATED 07 TH SEPTEMBER, 2012 HAVE BEEN ISSUED AT THE ADDRESS AT 290, V & PO- KAPASHERA, NEW DELHI AND IF THE SAID NOTICE HAVE BE EN SERVED UPON THE ASSESSEE IN THE ORDINARY COURSE OF BUSINESS, TH ERE WAS NO NECESSITY FOR THE A.O. TO ISSUE FURTHER NOTICE UNDE R SECTION 143(2) 9 ITA.NO.359/DEL./2017 SHRI RAKESH KUMAR GUPTA, NEW DELHI. ON 24 TH SEPTEMBER, 2012 AT THE ADDRESS AT SOHNA ROAD, GURG AON. THESE FACTS CLEARLY PROVE THAT THE NOTICE UNDER SEC TION 143(2) DATED 07 TH SEPTEMBER, 2012 AND 24 TH SEPTEMBER, 2012 HAVE NOT BEEN SERVED UPON THE ASSESSEE AND THE TRUE FACTS ARE NOT BROUGHT ON RECORD. THE ASSESSEE DENIED SERVICE OF THE NOTICE I N THE ADDITIONAL GROUND OF APPEAL SO ADMITTED. IT MAY BE NOTED HERE THAT WHEN ADDITIONAL GROUND WAS ADMITTED ON 29 TH AUGUST, 2017, LD. D.R. WAS DIRECTED TO PLACE ON RECORD THE EVIDENCE OF SERVICE OF NOTICE UNDER SECTION 143(2) OF THE I.T. ACT. HOWEVER, THE LD. D. R. APART FROM FILING COPY OF THE NOTICE UNDER SECTION 143(2) DATED 07 TH SEPTEMBER, 2012, BEARING POSTAL STAMP, DID NOT PRODUCE ANY EVI DENCE OF SERVICE OF THE NOTICE UNDER SECTION 143(2) OF THE I .T. ACT. IN THE FACTS AND CIRCUMSTANCES AND IN VIEW OF THE ABOVE DISCUSSI ON, EVEN THE PRESUMPTION COULD NOT BE RAISED IN FAVOUR OF THE RE VENUE THAT THE NOTICE UNDER SECTION 143(2) HAVE BEEN SERVED UPON T HE ASSESSEE WITHIN THE PERIOD OF LIMITATION. IN VIEW OF THE ABO VE, I AM OF THE VIEW THAT REVENUE FAILED TO PRODUCE ANY EVIDENCE OF SERV ICE OF THE NOTICE UNDER SECTION 143(2) OF THE I.T. ACT UPON ASSESSEE WITHIN THE PERIOD OF LIMITATION. THEREFORE, THE ASSESSMENT ORDER SO P ASSED IS WITHOUT 10 ITA.NO.359/DEL./2017 SHRI RAKESH KUMAR GUPTA, NEW DELHI. JURISDICTION AND VOID ABINITIO AND IS LIABLE TO BE QUASHED. THE DECISIONS RELIED UPON BY THE LD. D.R. WOULD NOT SUP PORT THE CASE OF THE REVENUE BECAUSE OF THE FACTS NOTED ABOVE. IN VIEW OF THE ABOVE, I SET ASIDE THE ORDERS OF THE AUTHORITIES BE LOW AND QUASH THE ASSESSMENT ORDER. RESULTANTLY, ALL ADDITIONS WOULD STAND DELETED. THE ADDITIONS ARE NOT DECIDED SEPARATELY BECAUSE TH E SAME ARE LEFT WITH ACADEMIC DISCUSSION ONLY. 6. IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT. 7. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DELHI, DATED 06 TH NOVEMBER, 2017 VBP/- COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT SMC BENCH, DELHI 6. GUARD FILE. // BY ORDER // ASST. REGISTRAR : ITAT DELHI BENCHES : DELHI.