Nitu Pattnaik, Angul V. ITO, Angul Ward, Angul

ITA 379/CTK/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 5002 (ITAT-CUTTACK)
• Duration Of Justice: 10 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-10-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2012-2013
• Appeal Filed On: 19-11-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S K SARANGI
• Keywords: Unexplained investment; Reason to believe
• Section: 250; 201; 13; 147; 148; 144

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH CUTTACK BEFORE SHRI C.M. GARG, JM & SHRI L.P. SAHU, AM . / ITA NO. 379 /CTK/20 1 9 ( / A SSESSMENT Y EAR : 20 1 2 - 201 3 ) NITU PATTNAIK, GANDHIMARG, AMAL APADA, ANGUL - 759122 VS. ITO, ANGUL WARD, ANGUL PAN NO. : A IXPP 0823 B ( / APPELLANT ) .. ( / RESPONDENT ) /ASSESSEE BY : SHRI S.K.SARANGI, FCA /REVENUE BY : SHRI SUBHENDU DUTTA, DR / DATE OF HEARING : 12 / 10 /20 20 / DATE OF PRONOUNCEMENT : 13 / 10 /20 20 / O R D E R PER L.P.SAHU, AM : TH IS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER DATED 06.09.2019 , PASSED BY THE CIT(A) - 2 , BHUBANESWAR FOR THE ASSESSMEN T YEAR 20 1 2 - 20 1 3 , ON THE FOLLOWING GROUNDS OF APPEAL : - 1. FOR THAT ORDER U/S - 250 OF THE IT ACT, DT.06.09.2019 AS PASSED BY THE LD CIT(A) - 2, BHUBANESWAR HEREINAFTER REFERRED TO AS THE LEARNED CIT(A) IS FAR FROM JUST AND LEGAL ON THE FACTS AND IN THE CIR CUMSTANCES OF THE CASE. 2. FOR THAT LD CIT(A) IS NOT JUSTIFIED TO CONFIRM THE ADDITION OF RS. 2,00,00,000/ - TOWARDS UN - EXPLAINED INVESTMENT IN FIXED DEPOSITS AS MADE BY THE LD. A.O IGNORING THE RELEVANT DOCUMENTS/PAPERS SUBMITTED BEFORE HIM ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE. 2 . AT THE OUTSET, D URING THE COURSE OF HEARING , LD. AR SUBMITTED THAT THE CIT( A) HAS PASSED THE EX - PARTE ORDER WITHOUT CONSIDERING THE SUBMISSIONS OF THE ASSESSEE. FURTHER THE LD. AR SUBMITTED THAT THE ITA NO. 379 /CTK/201 9 2 ADDITION OF RS .2 CRORES MADE BY THE AO ON ACCOUNT OF UNEXPLAINED INVESTMENT IN FIXED DEPOSIT IS NOT TENABLE AS THESE DEPOSITS HAVE BEEN MADE OUT OF CHEQUE PAYMENTS FROM THE ASSESSEES OWN BANK ACCOUNTS. IN THIS REGARD, LD. AR FILED HIS WRITTEN SUBMISSIONS IN THE PAPER B OOK AT PAGES 3 TO 5, BEFORE THE CIT(A) , WHICH READ AS UNDER : - 1. PROCEEDINGS U/S - 147 OF THE I.T. ACT. (1) ASSESSEE IS AN INDIVIDUAL FILED THE ORIGINAL RETURN U/S - 139(L) ON 07.10.2012 DISCLOSING TOTAL INCOME OF RS 3,11,360/ - . (2) LA A.O HAS INITIATE D RE - ASSESSMENT PROCEEDINGS U/S - 147 OF THE I.T. ACT ON THE BASIS OF REASON RECORDED ON 17.03.2017 AND ISSUED NOTICE U/S - 148 ON 27.03.2017. AS MENTIONED IN THE ASSESSMENT ORDER. IT IS SUBMITTED THAT ASSESSEE HAS NOT RECEIVED ANY NOTICE ISSUED U/S 148 OF THE I.T. ACT. (3) AS PER NOTE SHEET COPY RECEIVED BY THE ASSESSEE, IT HAS BEEN NOTED BY THE LD A.O THAT RE - ASSESSMENT PROCEEDINGS HAS BEEN INITIATED ON THE BASIS OF SURVEY CONDUCTED ON 05.02.2015 AND A SURVEY REPORT OF DDIT (INV). COPY OF NOTE SHEET OF RE - A SSESSMENT PROCEEDINGS IS ENCLOSED ON ANNEXURE - 1. (4) THE PRESENT RE - ASSESSMENT PROCEEDINGS HAS BEEN INITIATED AFTER TWO YEARS ON THE BASIS OF SURVEY CONDUCTED ON 05.02.2015 IN THE CASE OF ASSESSEE'S HUSBAND SRI KSHIROD KUMAR PATTNAIK THAT THERE IS A UNDI SCLOSED INVESTMENT IN FIXED DEPOSITS TO THE TUNE OF RS 2,50 CRORE AND ALSO ASSESSEE HAS NOT SHOWN ANY INTEREST INCOME AS NOTED IN THE NOTE SHEET ENTRY DT 17.03.2017. THE 'REASON TO BELIEVE' THAT INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT IS BASED ON 'SURVEY REPORT' ALONE AND THERE IS NO INDEPENDENT SATISFACTION RECORDED BY THE A.O THAT INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. THEREFORE, INITIATION OF RE - ASSESSMENT PROCEEDINGS ON THE BASIS OF REPORT OF SURVEY IS WITHOUT JURISDICTION, BASED ON SURMISE, CONJUNCTURE LIABLE TO BE ANNULLED. 2. NON - ISSUE OF NOTICE U/S.143(2): IN THI S CASE THE PRESENT ASSESSMENT HAS BEEN COMPLETED WITHOUT SERVING NOTICE 5.143(2) OF THE I.T.ACT, 1961. IN THIS REGARD IT IS SUBMITTED THAT THE LEARN ED A SSESSING OFFICE AT PAGE - 2 OF HIS ORDER HAS INTER - ALIA OBSERVED THAT NO RETURN OF I NCOME HAS BEEN FILED IN RESPONSE TO NOTICE U/S.148 WHICH IS NOT AT ALL A FACT AND THIS IS WELL EVIDENT FROM PAGE - 9 OF THE ASSESSMENT ORDER WHEREIN THE LEARNED ASSESSI NG OFFICER WHILE COMPUTING THE TOTAL INCOME HAS TAKEN THE INCOME AS PER RETURN ATRS.35,09,538/ - AND THEREAFTER MADE THE ADDITIONS, THEREFORE IT CANNOT BE SAID THAT NO RETURN OF INCOME HAS BEEN FILED. IT IS RELEVANT TO MENTION ITA NO. 379 /CTK/201 9 3 HERE THAT COMPLETION OF ASSESSMENT WITHOUT SERVING NOTICE U/S.143(2) IS ILLEGAL AND BAD IN LAW AND LIABLE TO BE QUASHED. LAW IS ALSO SETTLED TO THIS EFFECT. 3. UN - EXPLAINED INVESTMENT - ADDITION OF RS 2,00,00,000/ - (1) IN THE ASSESSMENT ORDER LD A.O HAS MADE AN ADDITION OF R S 2,00,00,000 TOWARDS INVESTMENT IN 4 NOS OF FIXED DEPOSITS MADE IN BANK OF BARODA, ANGUL BRANCH AS NOTED IN THE ASSESSMENT ORDER AT PARA - 4. (2) THE SOURCES OF INVESTMENT OF FIXED DEPOSIT OF RS 2,00,00,000/ - ARE FURNISHED BELOW. F.D A/C NO A/C OPEN DA TE AMOUNT SOURCES 26350300002932 26350300002933 30.05.2011 30.05.2011 A 50,00,000 50,00,000 1,00,00,000 OUT OF DRAWAL MADE BY CH. NO - 730985 DT 30.05.2011 FROM THE A/C NO - 2635010 0006366 WITH BANK OF BARODA OF THE ASSESSEE. 26350300002946 26350300002947 10.06.2011 10.06.2011 B 50,00,000 50.00,000 1,00,00,000 OUT OF DRAWAL MADE ON 10.06.2011 FROM THE A/C NO - 26350100006366 WITH BANK OF BARODA OF THE ASSESSE E. (A+B) 2,00,00,000 COPY OF THE SB A/C NO - 26350100006366 WITH BANK OF BARODA ANGUL BRANCH SHOWING WITH DRAWAL OF RS. 1,00,00,000/ - ON 30.05.2011 AND RS 1,00,00,000/ - ON 10.06.2011 TOTALING TO RS 2,00.00,000/ - FOR INVESTMENT IN FIX DEPOSIT IS ENCLOSE D AS ANNEXURE - 2. THE SOURCES OF CASH DEPOSIT OF RS 50,00,000/ - ON 11.04.2011 AND RS 50,00,000/ - ON 15.0 4 . 2011 TOTALING RS. 1,00,00,000/ - IN SB A/C NO - 26350100006366 OF THE ASSESSEE IS OUT OF CASH DRAWAL MADE FROM CC A/C NO - 26350500000038 WITH BANK OF BARO DA OF THE ASSESSEE'S HUSBAND SRI KSHIROD KUMAR PATTNAIK. COPY OF THE CC A/C NO - 26350500000038 WITH BANK OF BARODN SHOWING CASH WITHDRAWAL OF RS.50,00,000/ - ON 11.04.2011 AND RS.50,00,000/ - ON 15.04.2011 TOTALING TO RS 1,00,00,000/ - IS ENCLOSED AS ANNEXURE - 3. THE SOURCE OF DEPOSIT OF RS 1,00,00,000/ - ON 10.06.2011 IN THE SB A/C NO. 50100006366 WITH BANK OF BARODA OF THE ASSESSEE IS BY WAY OF TRANSFER OF RS .1 00,00,000/ - ON 10.06.2011 VIDE CHEQUE NO - 511928 FROM THE A/C NO - 26350100005947 O F THE ASSESSEE'S HUSBAND SRI KSHIROD KUMAR PATTNAIK@ MUNA PATTNAIK WITH BANK OF BARODA. IN SUPPORT OF TRANSFER OF RS 1,00,00,000/ COPY OF THE A/C NO - 26350100005947 IS ENCLOSED AS ANNEXURE - 4. IN VIEW OF ABOVE FACTS ADDITION OF RS 2,0 0,00,000/ - U/S - 69 OF THE I.T. ACT IS NOT LEGALLY SUSTAINABLE AND KINDLY BE DELETED. 4. OBJECTION TO ASSESSMENT U/S - 144 OF THE I.T. ACT THE ASSESSEE STRONGLY OBJECTS TO THE ASSESSMENT COMPLETED U/S - 144 OF THE I.T. ACT, AS THE ASSESSEE HAD MADE COMPLIANCE O N 21.07.2017 DURING ASSESSMENT PROCEEDINGS AS EVIDENT FROM THE NOTE SHEET ENTRY. THE LD A.O HASTILY COMPLETED THE ASSESSMENT ON 23.11.2017 WITHOUT PROVIDING ITA NO. 379 /CTK/201 9 4 PROPER OPPORTUNITY TO THE ASSESSEE ALTHOUGH TIME WAS AVAILABLE UP TO 31.12.2018 TO PASS THE ASSESSM ENT ORDER. ACCORDINGLY, THE LD. AR SUBMITTED THAT ONE MORE OPPORTUNITY MAY BE PROVIDED TO SUBSTANTIATE THE CLAIM OF THE ASSESSEE BEFORE THE AO. 3 . ON THE OTHER HAND, LD. DR RELIED ON THE ORDERS OF LOWER AUTHORITIES AND HE SUBMITTED THAT THE ORDER OF THE L OWER AUTHORITIES SHOULD NOT BE DISTURBED. HE FURTHER STATED THAT THE MANY NUMBER OF OPPORTUNITIES WERE GIVEN BY THE AO AS WELL AS THE CIT( A ) BUT THE ASSESSEE FAILED TO AVAIL THE SAME. 4 . ON CAREFUL CONSIDERATION OF THE SUBMISSIONS OF BOTH THE SIDES AND PE RUSING THE RELEVANT MATERIAL PLACED IN THE RECORD OF THE TRIBUNAL ALONG WITH THE ORDERS OF BOTH THE AUTHORITIES BELOW, WE FIND THAT THE ASSESSING OFFICER HAS PASSED THE ASSESSMENT ORDER U/S.144 OF THE ACT. FROM THE PERUSAL OF THE ASSESSMENT ORDER AS WELL A S CIT(A)S ORDER, IT IS CLEAR THAT THE ASSESSEE HAS NOT APPEAR ED BEFORE BOTH THE AUTHORITIES BELOW TO SUBSTANTIATE HER CLAIM. DURING THE COURSE OF HEARING LD. AR DREW OUR ATTENTION TO PAGE 10 OF THE PAPER BOOK, MARKED AS ANNEXURE - 2, WHICH IS A COPY OF BANK ACCOUNT LEDGER INQUIRY AND ON CAREFUL PERUSAL OF THE SAME, WE F IND THAT THERE IS WITHDRAWAL OF RS.1 CRORES ON 10.06.2011 AND RS.1 CRORE ON 30.05.2011 FOR INVESTMENT IN FIXED DEPOSIT. FURTHER IT IS ALSO FOUND THAT THE SOURCE OF DEPOSIT AS EXPLAINED BY THE LD. AR OF THE ASSESSEE THAT AMOUNT OF RS.1 CRORES (RS.50 LAKHS+50LAKHS) HAS BEEN RECEIVED IN CASH FROM THE WITHDRAWAL OF THE ITA NO. 379 /CTK/201 9 5 ASSESSEES HUSBANDS SHRI KSHIROD KUMAR PATTNAIKS ACCOUNT BEARING NO. 263500000038 AND RS.1 CRORE TRANSFERRED FROM THE ACCOUNT N O. 26350100005947 VIDE CHEQUE NO.511928 MAINTAINED WITH BANK OF BARODA . THEREFORE, IT CANNOT BE SAID THAT THE INVESTMENTS MADE BY THE ASSESSEE ARE NOT RECORDED IN THE BOOKS OF ACCOUNT. CONSIDERING THE ABOVE FACTUAL ASPECTS AND CIRCUMSTANCES OF THE CASE AND IN THE INTEREST OF JUSTICE , WE RESTORE THE APPEAL OF THE ASSESSEE TO THE FILE OF AO AND DIRECT THE AO TO FRAME THE ASSESSMENT DE NOVO CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AS WELL AS THE OBSERVATIONS MADE BY US IN THE ABOVE. THE ASSESSEE IS DIRECTED TO PLACE THE DOCUMENTS WHICH HAVE BEEN FILED BEFORE US IN THE FORM OF PAPER BOOK AND THE AO IS DIRECTED TO CONSIDER THE SAME AFTER DUE VERIFICATION AND EXAMINATION AND DECIDE THE ISSUE AS PER LAW. NEEDLESS TO SAY, THE ASSESSEE SHALL BE PROVIDED REAS O NABLE OPPORTUNITY OF HEARING. THE ASSESSEE IS ALSO DIRECTED TO COOPERATE WITH THE AO POSITIVELY FOR EARLY DISPOSAL OF THE CASE. THUS, WE ALLOW THE APPEAL OF THE ASSESSEE FOR STATISTICAL PURPOSES. 5 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATIS TICAL PURPOSES . ORDER PRONOUNCED IN THE OPEN COURT ON 13 / 10 / 20 20 . SD/ - ( C.M.GARG ) SD/ - (L.P.SAHU) / JUDICIAL MEMBER / ACCOUNTANT MEMBER CUTTACK ; DATED 13 / 10 /20 20 PRAKASH KUMA R MISHRA, SR.P.S. ITA NO. 379 /CTK/201 9 6 / COPY OF THE ORDER FORWARDED TO : / BY ORDER, ( SENIOR PRIVATE SECRETARY ) , /ITAT, CUTTACK 1. / THE APPELLANT - NITU PATTNAIK, GANDHIMARG, AMALAPADA, ANGUL - 759122 2. / THE RESPONDENT - ITO, ANGUL WARD, ANGUL 3. ( ) / THE CIT(A), 4. / CIT 5. , , / DR, ITAT, CUTTACK 6. / GUARD FILE. //TRUE COPY//