ITO, New Delhi V. Sh. Vinod Gupta, New Delhi

ITA 3648/DEL/2013

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 7326 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 3 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-09-2014
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 24-09-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 06-06-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: SAMEER SHARMA
• Keywords: Principle of natural justice
• Section: 133(6); 68

Judgement Text

ITA NO. 3648 / DEL/ 2013 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH H , NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI J.S. REDDY, ACCOUNTANT MEMBER I.T.A. N O. 3648/DEL/2013 A.Y. : 2009 - 10 INCOME TAX OFFICER, WARD 31(4), ROOM NO. 1410, 14 TH FLOOR, E - 2, BLOCK, CIVIC CENTRE, NEW DELHI VS SH. VINOD GUPTA, E - 111, GROUND FLOOR, B.K. DUTT COLONY, LODHI ROAD, NEW DELHI - 110003 (APPELLANT) (RESPONDENT) DEPARTMENT BY : SH. VINOD GUPTA, ASSESSEE ASSESSEE BY : SH. SAMEER SHARMA, SR. DR DATE OF HEARING : 24 - 9 - 2014 DATE OF ORDER : 26 - 9 - 2014 ORDER PER H.S. SIDHU : J M TH IS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS ) - XX VI , NEW DELHI DATED 26 . 3 .201 3 P ERTAINING TO ASSESSMENT YEAR S 2009 - 10 ON THE FOLLOWING GROUND: - THE CIT(A) HAS ERRED IN LAW BY DELETING THE ADDITION OF RS. 25,07,400/ - MADE U/S. 68 OF THE I.T. ACT, 1961 IN A SITUATION WHEN THE ASSESSEE EVEN DURING THE APPELLATE PROCEEDINGS WAS UNABL E TO ITA NO. 3648 / DEL/ 2013 2 PROVE THE EXISTENCE OF M/S LOCUS PROPBUILD PVT. LTD. FROM WHOM RS. 16,00,000/ - WAS CLAIMED TO HAVE BEEN RECEIVED AND ALSO CREDITWORTHINESS OF LENDERS FROM WHOM RS. 4,53,000/ - AND RS. 3,00,000/ - WERE CLAIMED TO HAVE RECEIVED. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND HAS DECLARED INCOME FROM JOB WORK AS CIVIL CONTRACTOR AND WHITE WASHING. ON THE AIR INFORMATION IT REVEALS THAT ASSESSEEE HAS DEPO S ITED CASH OF RS.25,07,400/ - IN HIS AXIS BANK SAVING ACCOUNT AND PURCHASED MOTOR VEHICLE OF RS. 5,44, 478/ - FROM SRI DURGA AUTOMOBILES. T HE ASSESSING OFFICER ASK E D THE ASSESSEE TO FURNISH NECESSARY DETAILS IN RESPECT OF THE SE TRANSACTIONS. IN RESPONSE TO THE SAME, THE ASSESSEE FURNISHED AN AFFIDAVIT DATED 04.11.2011 WH EREIN HE HAS SUBMITTED THAT HE HAD PURCHASED A CAR FROM M/S DURGA AUTOMOBILES FOR RS. 5,44,478/ - FOR WHICH HE HAD TAKEN LOAN FROM ICLCI BANK. ASSESSEE HAS ALSO SUBMITTED THAT SOME DOCUMENTARY EVIDENCE SUPPORTING HIS CLAIM. AFTER RECEIVING THE DOCUMENTARY EVIDENCES, THE AO ISSUED NOTICE U/S. 133(6) TO AXIS BANK ASKING THEM TO SUBMIT THE BANK STATEMENT OF ALL THE RELEVANT PERIOD. IN RESPONSE TO THE SAME, THE BANK HAS SUBMITTED THE STATEMENT ON ACCOUNT OF THE ASSESSEE FOR THE PERIOD 1.4.2008 TO 31.3.2009 WHI CH CONFIRMED THAT CASH DEPOSIT OF RS. 25,07,400/ - . THE ASSESSEE WAS CONFR O NTED THAT THE CASH DEPOSITS IN HIS BANK ACCOUNT AND HE SUBMITTED THAT HE HAD RECEIVED THE CASH FROM THREE PERSONS NAMELY RS. 16,00,000/ - FROM M/S LOCUS PROPBUILD PVT. LTD.; RS. 3,00,000/ - ITA NO. 3648 / DEL/ 2013 3 RECEIVED AS REPAYMENT OF LOAN BY MR. SATISH CHANDRA BHANDARI AND RS. 4,53,000/ - RECEIVED AS REPAYMENT OF LOAN BY SH. BADRI PRASAD MEENA. ASSESSE HAS ALSO PRODUCED COPY OF ACCOUNTS IN RESPECT OF MR. SATISH CHANDRA BHANDARI AND SH. BADRI PRASAD ME ENA, BUT NO DETAILS REGARDING CREDITWORTHINESS OF THE PERSONS LIKE BANK STATEMENT, SOURCE OF INCOME HAVE BEEN FILED BY THE ASSESSEE, ALTHOUGH THERE IS MENTION ON THE ACCOUNTS ITSELF THAT THESE PER S ONS HAVE THEIR PERMANENT ACCOUNT NUMBER. ASSESSEE HAS NOT FILED ANY DETAIL OF M/S LOCUS PROPBUILT PVT. LTD.. AO ISSUED NOTICE U/S. 133(6) OF THE ACT TO THE COMPANY, BUT RETURNED BACK BY THE POSTAL AUTHORITIES WITH THE REMARKS LEFT . ASSESSEE ALSO DID NOT FURNISH ANY SUBSTANTIAL DOCUMENT IN THIS RESPECT EVEN AFTER PROVIDING SUFFICIENT OPPORTUNITY TO HIM AND LASTLY THE AO HELD THAT ENTIRE DEPOSIT OF RS. 25,07,400/ - REMAIN UNEXPLAINED AND HE ADDED AS INCOME OF THE ASSESSEE, U/S. 68 OF THE I.T. ACT. 2.1 SECONDLY, AO HAS ALSO ADDED RS. 34,423/ - ON ACCOUNT OF BA NK INTEREST WHICH THE ASSESSEE HAS EARNED, AS PER THE BANK STATEMENT OF AXI S BANK. BUT HAS NOT BEEN OFFERED TO TAX IN HIS RETURN OF INCOME FILED FOR THE RELEVANT ASSES S MENT YEARS. 2.2 THIRDLY, THE AO HAS ALSO ADDED RS. 1,64,100/ - ON ACCOUNT OF UNEXPLAI NED MONEY AND ADDED THE SAME TO THE INCOME OF THE ASSESSEE U/S. 68 OF THE I.T. ACT , BECAUSE ASSESSEE HAS PURCHASED MOTOR CAR FOR RS. 6,17,538/ - OUT OF WHICH RS. ITA NO. 3648 / DEL/ 2013 4 4,53,438/ - WHICH WAS FINANCED BY ICICI BANK LIMITED. THE AO COMPLETED THE ASSES S MENT U/S. 1 43(3) OF THE I.T. ACT VIDE HIS ORDER DATED 20.12.2011. 3. AGGRIEVED BY THE ORDER OF THE ASSESSING OFFICER AS AFORESAID, ASSESSEE APPEALED BEFORE THE LD. FIRST APPELLATE AUTHORITY, WHO VIDE HIS IMPUGNED ORDER DATED 26.3.2013 HAS PARTLY ALLOWED THE APPE AL OF THE ASSESSEE AND DELETED THE ADDITION IN DISPUTE. 4. AGAINST THE ABOVE ORDER OF THE LD. FIRST APPELLAT AUTHORITY, REVENUE IS IN APPEAL BEFORE US. 5. AT THE TIME OF HEARING LD. DR REITER A TED THE FACTS NAR R ATED BY THE AO AND ALSO READ THE ORDER OF THE LD. FIRST APPELLATE AUTHORITY FROM WHICH HE ESTABLISHED THAT ASSESSEE HAS CHANGED HIS STAND BEFORE THE LD. FIRST APPELLATE AUTHORITY BY PRODUCING VARIOUS DOCUMENTARY EVIDENCE. LD. DR STATED THAT ASSESEE HAS CHANGED ITS STAND BEFORE THE FIRST APPEL LATE AUTHORITY BY MAKING THE STATEMENT THAT HE HAS NOT DEPOSITED THE CASH OF RS. 25,07,400/ - . HE ADMITTED THAT HE HAS P URCHASED A CAR FROM M/S DURGA AUTOMOBILE FOR AN AMOUNT OF RS. 6 , 17 , 538 / - FOR WHICH HE HAD TAKEN A LOAN FROM ICICI BANK. LD. DR FURTHER S TATED THAT AO ISSUED NOTICE U/S. 133(6) OF THE I.T. ACT TO THE BANK ASKING TO SUBMIT THE BANK STATEMENT OF ALL THE RELEVANT PERIOD AND BANK HAS CONFIRMED THAT ASSESSEE HAS DEPOSITED CASH OF RS. 25,07,400/ - WHICH WAS CONFRONTED TO THE ASSESSEE AND ASSESSEE HAS EXPLAINED THAT HE HAS TAKEN THE LOANS FR O M THREE PERSONS NAMELY RS. 16,00,000/ - FROM M/S LOCUS PROPBUILD PVT. LTD.; RS. 3,00,000/ - RECEIVED AS REPAYMENT OF LOAN BY MR. SATISH CHANDRA BHANDARI AND RS. 4,53,000/ - RECEIVED AS REPAYMENT OF LOAN BY SH. BADRI PRASAD MEENA FOR WHICH HE HAS NOT ITA NO. 3648 / DEL/ 2013 5 FILED ANY EVIDENCE BEFORE THE AO. LD. DR FURTHER STATED THAT ASSESSEE H AS ALSO RAISED A NEW ARGUMENT BEFORE THE LD. FIRST APPELLATE AUTHORITY REGARDING RECEIVE OF MONEY FOR THE PURCHASE OF LAND WHICH WAS NOT PLEA DED BEFORE THE AO BY HIM. LD. DR STATED THAT ASSESSEE HAS CHANGED ITS STAND BEFORE THE LD. CIT(A) AND LD. CIT(A) ACCEPTED THE VERSION OF THE ASSESSEE AND WRONGLY DELETED THE ADDITIONS IN DISPUTE. HENCE, HE REQUESTED THAT THE ORDER OF THE LD. CIT(A) MA Y BE CANCELLED AND THE ORDER OF THE AO MAY BE UPHELD. 6. ON THE OTHER HAND, SH. VINOD GUPTA (ASSESSEE) APPEARED IN PERSON AND STATED THAT HE HAD FILED ALL THE DOCUMENTARY EVIDENCE BEFORE THE AO AS WELL AS LD. FIRST APPELLATE AUTHORITY . HE FURTHER SUBMI TTED THAT LD. CIT(A) RIGHTLY DELETED THE ADDITIONS IN DISPUTE AFTER PROVIDING THE EVIDENCE FILED BY HIM. HE REQUESTED THAT DEPARTMENT APPEAL MAY BE DISMISSED. 7. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. WE ARE OF THE VIEW THAT ASSESSE E HAS FILED ITS RETURN OF INCOME FOR RS. 2,15,140/ - WHICH WAS PROCESSED U/S. 143(1) OF THE I.T. ACT AND LATER THE CASE WAS TAKEN UP FOR SCR U TINY UNDER CASS. AFTER ADOPTING PRESCRIBED PROCEDURE UNDER THE LAW, THE AO ON THE BASIS OF AIR INFORMATION REVEA L ED T HAT THAT ASSESSEE HAS DEPOSITED CASH OF RS. 25,07,400/ - IN HIS AXIS BANK ACCOUNT AND ALSO PURCHASED MOT O R VEHICLE OF RS. 6,17,538 / - FROM M/S DURGA AUTOMOBILES. AO CALLED THE INFORMATION ALONGWITH DOCUMENTARY EVIDENCE FROM THE ASSESSEE FOR SUBSTANTIATING T HE CASH DEPOSITS IN THE BANK AND FOR PURCHASED A MOTOR VEHICLE. ASSESSEE HAS FURNISHED SOME INFORMATION BEFORE THE AO AND AO ISSUED NOTICE U/S. 133(6) TO AXIS BANK ASKING THEM TO SUBMIT THE BANK STATEMENT OF ALL THE RELEVANT PERIOD. IN RESPONSE TO T HE SAME, THE BANK HAS SUBMITTED THE STATEMENT ON ACCOUNT OF THE ASSESSEE FOR THE PERIOD 1.4.2008 TO 31.3.2009 WHICH CONFIRMED THAT CASH DEPOSIT OF RS. 25,07,400/ - . THE ASSESSEE WAS CONFR O NTED THAT THE CASH DEPOSITS IN HIS BANK ITA NO. 3648 / DEL/ 2013 6 ACCO U NT AND HE SUBMITTED TH AT HE HAD RECEIVED THE CASH FROM THREE PERSONS NAMELY RS. 16,00,000/ - FROM M/S LOCUS PROPBUILD PVT. LTD.; RS. 3,00,000/ - RECEIVED AS REPAYMENT OF LOAN BY MR. SATISH CHANDRA BHANDARI AND RS. 4,53,000/ - RECEIVED AS REPAYMENT OF LOAN BY SH. BADRI PRASAD ME ENA. ASSESSEE HAS ALSO EAR N ED SOME BANK INTEREST AS PER THE BANK STATEMENT I.E. AMOUNTING TO RS. 34,423/ - WHICH HE HAS NOT OFFERED TO TAX IN THE RETURN OF INCOME. AS REGARDS THE PURCHASE OF VEHICLE THE ASSESSEE HAS PURCHASED A CAR FOR RS. 6,17,538/ - OU T OF THIS AMOUNT RS. 4,93,438/ - WAS FINANCED BY THE ASSESSEE FROM ICICI BANK AND THE BALANCE AMOUN T OF RS. 1,64,100/ - REMAINED UNEXPLAINED WHICH AO HAS ADDED AS INCOME OF THE ASSESSEE U/S. 68 OF THE I.T. ACT. 7.1 WE FIND THAT BEFORE THE ASSESSEE HAS CH ANGED ITS STAND BEFORE THE LD. CIT(A) AS RIGHTLY STATED BY THE LD. DR. ASSESSEE HAS STATED THAT HE HAS WITHDRA W N THE CASH FROM THE BANK FOR THE PURCHASE OF LAND BUT AGAIN DEPOSITED THE SAME DUE TO NON - UTILIZATION OF THE SAME . ASSESS E E HAS ALSO CHANGE D HIS STAND THAT HE HAS RECEIVED SOME ADVANCE FROM HIS FATHER - IN - LAW AND ALSO FILED CONFIRMATION ALONGWITH PAN CARD. THIS AVERMENT HAS NOT BEEN MADE BEFORE THE AO AND THE LD. FIRST APPELLATE AUTHORITY HAS WRONGLY DELETED THE ADDITION IN DISPUTE BY ACCEP TING THE ARGUMENTS OF THE ASSESSEE. WE ARE OF TH E VIEW THAT THE ASSESSEE HAS CHANGED HIS STAND BEFORE THE LD. FIRST APPELLATE AUTHORITY IN WHICH THE AO HAS NOT GIVEN A CHANCE TO REBUT THE DOCUMENTARY EVIDENCE FILED BEFORE THE LD. CIT(A ) AND THE ADDITION IN DISPUTE IS CONTRARY TO THE PRINCIPLES OF NATURAL JUSTICE. IN OUR CONSIDERED OPINION, THE IMPUGEND ORDE OF THE LD. CIT(A) IS NOT SUSTAINABLE IN THE EYES OF LAW AND THEREFORE, WE CANCEL THE IMPUGEND ORDER. KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES O F THE PRESENT CASE AND THE AVERMENTS MADE BY THE ASSESSEE BEFORE THE AO AS WELL AS LD. CIT(A) ALONGWITH THE DOCUMENTARY EVIDENCE FILED BY HIM, WE ARE OF THE VIEW THAT THE ISSUE IN ITA NO. 3648 / DEL/ 2013 7 DISPUTE REQUIRES RE - EXAMINATION AT THE LEVEL OF THE ASSESSING OFFICER, THERE FORE, WE SET ASIDE THE ISSUE IN DISPUTE. 8 . IN THE RESULT, THE APPEAL FILED BY THE REVENUE STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE O PEN C OURT ON 26 / 9 /20 1 4 . SD/ - SD/ - [ J.S. REDDY ] [ H.S. SIDHU ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 26 / 9 /201 4 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 ITA NO. 3648 / DEL/ 2013 8