Nikitaben Ashokbhai Patel (Bhalodiya), Rajkot V. The ACIT, Circle-2(1), Rajkot

ITA 383/RJT/2018

• Counselvise Citation: [2022] 107 COUNSELVISE.COM (IT) 1528 (ITAT-RAJKOT)
• Duration Of Justice: 3 year(s) 8 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 17-10-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Accommodation entries; Assessment record; Set aside; Capital Gains
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT Before: Shri Waseem Ahmed, Accountant Member And Shri Siddhartha Nautiyal, Judicial Member Nikitaben Ashokkumar Patel, Shiv-Krupa, 33 -Paras Society, Nirmala Covent Road , Rajkot PAN: ALTPP2803Q ( Appellant) Vs The ACIT, Central Circle -1, Rajkot (Respondent) Assessee by: Written Submission Revenue by: Shri B.D. Gupta, Sr. D.R. Date of hearin g : 28-06-2022 Date of pronounce men t : 01-07-2022 आदेश/ORDER PER BENCH:- This assessee’s appeal for A.Y. 2011-12, arises from order of the CIT(A)-11, Ahmedabad dated 02-07-2018, in proceedings under section 143(3) r.w.s. 147 of the Income Tax Act, 1961; in short “the Act”. 2. The assessee has raised the following grounds of appeal:- ITA No. 383/Rjt/2018 Assessment Year 2011-12 I.T.A No. 383/Rjt/2018 A.Y. 2011-12 Page No Nikitaben Ashokkumar Patel vs. ACIT 2 “1] The grounds raised in this appeal are without prejudice to one another. 2] The Ld. Assessing Office erred in law and on facts in reopening the assessment and the Ld. CIT[A] erred in law and on facts in not quashing the action of the Ld. A.O. in this regard. On the facts and circumstances of the case and as per law it is contended that the reopening of the assessment, as it is, be held to be bad in law. 3] The Ld. Assessing Office erred in law and on facts in making the addition of Rs.566000/- in the reopened assessment and the Ld.CIT[A] erred in law and on facts in retaining the addition made by the Ld. A.O. On the facts and circumstances of the case it is contended that the addition made deserves to be deleted. 4] The ground on the basis of which the contested addition has been made are factually incorrect and legally untenable and the addition deserves to be deleted. 5] The assessee denies of having received accommodation entries and it is contended that the long term capital gain earned on sale of shares, supported by material on record, ought to be held as such. 6] The Ld. Assessing Office erred in law and on facts in making addition of Rs.566000/- based only on the statements of some persons whose names have been stated in assessment order. It is contended that since the cross-examination of the persons whose statements had been relied upon by the Ld. A.O. has not been granted and the material relied upon by the Ld. A.O. for making the addition has not been furnished to the appellant for rebuttal, the addition made by the Ld. A.O. and retained by the Ld.CIT[A] deserves to be deleted. 7] The Ld. Assessing office erred in law and on facts in making addition of Rs.11320/- alleged to be the commission paid by the assessee for obtaining alleged accommodation entry and the Ld.CIT[A] erred in law and on facts in retaining the same. The assessee denies of having obtained any such accommodation entries and therefore the addition of Rs.11320/- is not called for. I.T.A No. 383/Rjt/2018 A.Y. 2011-12 Page No Nikitaben Ashokkumar Patel vs. ACIT 3 8] The Ld. Assessing Office erred in law and on facts in making various incorrect averments in the assessment and erred in proceeding on erroneous presumptions and premises while making the addition of Rs.555000/ & Rs.11320/- when the same was not supported by the material and was not in accordance with law and the Ld.CIT [A] erred in law and on facts in retaining the addition based on erroneous presumptions and premises of the Ld. A.O. 9] It is contended that since the addition has been made in an automatic manner on the basis of search carried out by some another branch of the Revenue, the addition made only on that basis is not sustainable in law. 10] It is respectfully submitted that the appellant stays at Rajkot, is a layman and not conversant with the tax matter and she had to engage, senior lawyer from Ahmedabad which took some time and therefore the submission could not be file, and in the meantime the appeal order passed by the Ld. CIT[A] dismissing the appeal. It is therefore alternatively prayed the appeal may kindly be restored to the file of the Ld. CIT(A). 11] The appellant respectfully submits that the grounds raised before the Ld. CIT[A] whose order is in appeal before the honorable Bench are reiterated and relied upon. 12] The Ld. A.O. erred in charging interest under the various provisions of the Act when the same was not in accordance with law. 13] It is therefore prayed the addition made in assessment order retained by the Ld. CIT[A] may kindly be ordered to be deleted. 14] Your appellant craves leave to add, alter, amend or withdraw any of the grounds stated here above.” 3. The brief facts of the case are the assessment order was passed under section 143(3) r.w.s. 147 of the Act by holding that the assessee had entered into the activity of earning long-term capital gains on sale of shares of Shri I.T.A No. 383/Rjt/2018 A.Y. 2011-12 Page No Nikitaben Ashokkumar Patel vs. ACIT 4 Ganesh Spinners Ltd (SGSL), which is a penny stock company, and accordingly made an addition of ₹ 566,000/ - by holding that assessee has resorted to accommodation entries to introduce unaccounted cash/money in his books of accounts with the only intention to evade taxes. Further, the Ld. Assessing Officer made an addition of ₹ 11,320/ - being the brokerage/commission on the sale of shares claimed as exempt under section 10(38) of the Act. In appeal, Ld. CIT(Appeals) dismissed the case ex-parte, stating that despite several opportunities the assessee neither attended the hearing to present his case nor did the assessee filed a written submissions. Accordingly, Ld. CIT(Appeals) confirmed the additions with the following observations: “4. As mentioned above, the appellant did not attend or file any submissions during the appellate proceedings. The appellant filed appeal but in spite of several opportunities provided, as mentioned above, the appellant did not file any submission or attended hearings to present his case. Looking to the facts mentioned in the assessment order in detail while making the additions, the additions made by the AO are confirmed and the appeal is dismissed.” 4. Before us, the assessee filed written submissions stating that there has been a complete mis-appreciation of facts by the revenue authorities. The assessee has not earned any long-term capital gain on the sale of shares of SGSL and this fact could have been verified by the assessing officer from the assessment records as well. The assessee has submitted that it is only an amount of ₹ 7,219/ -which was the short-term capital gain on shares of SGSL which the assessee has duly offered to tax in the return of income. The Ld. I.T.A No. 383/Rjt/2018 A.Y. 2011-12 Page No Nikitaben Ashokkumar Patel vs. ACIT 5 DR relied upon the observations made by the Ld. Assessing Officer in the assessment order. 5. We have heard the rival contentions and perused the material on record. In our considered view, since the Ld. CIT(Appeals) did not get an opportunity to analyse the facts from a correct perspective, in the interests of justice, we are setting aside the case to the file of the Ld. CIT(Appeals) for fresh adjudication, after giving due opportunity to the assessee to present his case. In the result, the case is being set aside to the file of Ld. CIT(Appeals) with the above directions. 6. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 01-07-2022 Sd/- Sd/- (WASEEM AHMED) (SIDHHARTHA NAUTIYAL) ACCOUNTANT MEMBER JUDICIAL MEMBER Rajkot : Dated 01/07/2022 आदेश क त ल प अ े षत / Copy of Order Forwarded to:- 1. Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT, Ahmedabad 6. Guard file. By order, Assistant Registrar, Income Tax Appellate Tribunal, Rajkot