ITO, New Delhi V. Mr. Yavit Singh Tehlan, Delhi

ITA 3846/DEL/2013

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 5472 (ITAT-DELHI)
• Duration Of Justice: 7 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-01-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Assessment Year: 2009-2010
• Appeal Filed On: 17-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SMEER SHARMA
• Assessee Lawyers: SUBODH GUPTA; MUKESH AGARWAL
• Keywords: Additional evidence; Reasonable cause; Non compliance
• Section: 143(3); 142(1); 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH H NEW DELHI) BEFORE SHRI U. B. S. BEDI, JUDICIAL MEMBER AND SHRI B. C. MEENA, ACCOUNTANT MEMBER I.T.A. NO. 138 /DEL/2012 & I.T.A. NO. 3846/DEL/20 13 (ASSESSMENT YEARS 2008-09 & 2009-10) ITO, WARD 46(1), VS. YAVIT SINGH TEHLAN, NEW DELHI 2/28, ROOP NAGAR, NEW DELHI PAN/GIR NO.: ADLPT8113D (APPELLANTS) (RESPONDENTS) ASSESSEE BY : SHRI SUBODH GUPTA & SHRI MUKESH AGARWAL, CA DEPARTMENT BY: SHRI SMEER SHARMA, SR. DR ORDER PER U B S BEDI, JUDICIAL MEMBER: THESE TWO APPEALS OF THE REVENUE ARE DIRECTED AGAI NST SEPARATE ORDERS PASSED BY LD. CIT(A)-I, NEW DELHI DATED 31.10.2011 FOR THE ASSESSMENT YEAR 2008-09 [WRONGLY MENTIONED BY CIT(A) AS 2006- 07 IN APPEAL ORDER OF LD. CIT(A)] AGAINST ORDER PASSED BY THE A.O. U/S 14 4 AND FOR THE ASSESSMENT YEAR 2009-10 DATED 15.04.2013 IN APPEAL FILED AGAIN ST ORDER PASSED BY THE A.O. U/S 143(3) OF THE ACT, RESPECTIVELY. 2. THESE APPEALS WERE HEARD TOGETHER AND HENCE, BEI NG DISPOSED OFF BY A SINGLE ORDER FOR THE SAKE OF CONVENIENCE. 3. IN APPEAL FOR THE ASSESSMENT YEAR 2008-09, CHALL ENGE IS WITH REGARD TO DELETION OF ADDITION OF RS.21,82,500/- MADE U/S 68 BESIDES SERVICE OF NOTICE I.T.A. NOS.138/DEL/2012 I.T.A. NO. 3846/DEL/2013 2 FOR ASSESSMENT. AFTER GIVING DETAILS OF NOTICE SEN T AND NOTING THAT DESPITE SENDING NOTICES ON THE ADDRESS GIVEN, ASSESSEE DID NOT APPEAR AND A.O. MADE ADDITION OF RS.21,82,500/- BY PASSING ORDER U/S 144 . IN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY, THE ASSESSEE FILED WRITT EN SUBMISSIONS IN WHICH HE CONFIRMED TO HAVE RECEIVED THE NOTICES DATED 11.08. 2009 AND 10.03.2010 BUT DENIED TO HAVE RECEIVED ANY NOTICE DATED 22.11.2010 . LAST SHOW CAUSE NOTICE DATED 16.12.2010 WAS RECEIVED ON 04.02.2011 AS THE ASSESSEE WAS OUT OF INDIA. HIS ABSENCE FROM INDIA WAS DULY CORROBOR ATED WITH COPY OF HIS PASSPORT. THE NOTICE DATED 11.08.2009 WAS STATED T O BE UNDISPUTEDLY SERVED AND ATTENDED. ABOUT THE FATE OF SUBSEQUENT NOTICES DATED 10.03.2010 AND 22.11.2010, IT WAS REPLIED BY THE ASSESSEE AS UNDER : SUBSEQUENTLY ANOTHER NOTICE U/S 142(1) DATED 10.03 .2010, FIXING FOR 18.03.2010, WAS ALSO SERVED ALONG WITH COPY OF AIR INFORMATION MENTIONING THE PARTICULARS OF THE CASH DEPOSIT ON 3 1.03.2008 OF RS.21,82,500/- WITH ICICI BANK, BANDRA, MUMBAI, BEI NG A SINGLE DEPOSIT ON THAT DATE. ON THE DESIGNATED DATE, ASSE SSEE AGAIN APPEARED IN PERSON TO ENQUIRE ABOUT THE NATURE OF I NFORMATION AS PER AIR AS HE HAD DENIED TO HAVE DEPOSITED ANY SUCH SUM NOR WAS HAVING ANY SUCH ACCOUNT IN MUMBAI. HE WAS VERBALLY TOLD T HAT MORE INFORMATION SHALL BE COLLATED AND COMMUNICATED TO T HE ASSESSEE. SUBSEQUENTLY, NO COMMUNICATION OR NOTICE WAS EVER R ECEIVED. THE ALLEGED NOTICE DATED 22.11.2010 WAS NEVER SERVED, W HICH RESULTED IN THE EX-PARTE ASSESSMENT. THE SHOW CAUSE NOTICE DAT ED 16.12.2010 AND ALSO THE EX-PARTE ASSESSMENT ORDER WAS SERVED / REC EIVED BY THE ASSESSEE ONLY ON 04.02.2011, ON HIS RETURN TO INDIA , AS HE WAS OUT OF INDIA, DURING THE PERIOD FROM 17.12.2010 TO 04.02.2 011, DULY EVIDENCED FROM THE COPY OF HIS PASSPORT FORMING PAR T OF PAPER BOOK. 4. DURING THE COURSE OF APPELLATE PROCEEDINGS, ASSE SSEE ALSO FURNISHED PAPER BOOK CONTAINING SOME EVIDENCES. SINCE THE OR DER APPEALED AGAINST WAS PASSED U/S 144, A REMAND REPORT WAS CALLED FOR. THE A.O. SENT A REMAND REPORT DATED 01.09.2011 THROUGH ADDL. CIT, RANGE 46 , DELHI. IN THE I.T.A. NOS.138/DEL/2012 I.T.A. NO. 3846/DEL/2013 3 SAID REMAND REPORT, ASSESSEES NON COMPLIANCES OF V ARIOUS NOTICES WAS MENTIONED WITH THE FOLLOWING: ASSESSEES PLEA THAT HE WAS OUT OF INDIA AT THE TI ME OF FIXING THE HEARING DATE 23.12.2010 IS COMPLETELY UNACCEPTABLE. 5. LD. CIT(A) NOTED THAT THE A.O. EMPHASIZED THAT A LL THE NOTICES WERE SERVED THROUGH SPEED POST AND SERVED UPON THE ASSES SEE. ON THE CONTRARY, ON BEHALF OF THE ASSESSEE, IT WAS SUBMITTED THAT THE S ERVICE BY POST AS PER RULE 27 OF THE GENERAL CLAUSES, 1897 IS PRESUMPTIVE SERV ICE AND THE SAME IS REBUTTABLE. THE A.O. COULD NOT PROVE THE SERVICE BY SPEED POST. NO EVIDENCE OF POSTAL RECEIPT WAS SUBMITTED WITH THE R EMAND REPORT. SIMILARLY, ASSESSEE COULD NOT PROVIDE ANY PLAUSIBLE REASON FOR NON-COMPLIANCE NOTICES DATED 10.03.2010 AND 22.11.2010, THOUGH MAINTAINING THAT NOTICE DATED 10.03.2010 WAS COMPLIED WITH. ASSESSEE HAS NOT REJ ECTED THE A.O.S CONTENTION THAT HE HAD NOT SENT THE NOTICES BY SPEE D POST BY CARRYING OUT FILE INSPECTION, IF WAS SO REQUIRED. LD. CIT(A) CONCLUD ED TO DECIDE THE ISSUE OF SERVICE OF NOTICE AGAINST THE ASSESSEE AS PER PARA 10 OF HIS ORDER WHICH READS AS UNDER: ON PERUSAL OF COMPLETE FACTS ,ASSESSMENT ORDER AND APPELLANTS SUBMISSIONS, A.O.S CONTENTION THAT ALL NOTICES WER E SENT BY SPEED POST AT THE CORRECT ADDRESS IS JUSTIFIED AND UNDISPUTED SO LONG AS SOME OF THE EARLIER NOTICES AND ALSO SHOW CAUSE NOTICE DATE D 16.12.2010 HAVE BEEN ADMITTED TO HAVE BEEN DULY SERVED UPON THE APP ELLANT. THEREFORE, APPELLANTS GROUND NOS. 1 TO 3 ARE NOT M AINTAINABLE AND DECIDED AGAINST HIM. 6. LD. CIT(A) FURTHER HELD THAT HOWEVER, ON THE DAT E OF PROBABLE SERVICE OF SHOW CAUSE NOTICE DATED 16.12.2010, EXPECTED TO BE SERVED ON 18.12.2010, AS WELL AS ON THE DATE OF HEARING I.E. 23.12.2010, ASSESSEE WAS UNDISPUTEDLY OUT INDIA FROM 17.12.2010 TO 04.01.201 1 AS EVIDENT FORM HIS I.T.A. NOS.138/DEL/2012 I.T.A. NO. 3846/DEL/2013 4 PASSPORT COPY. IN THE REMAND REPORT A.O. HAS NOT M ADE ANY CASE FOR REJECTION OF THIS PLEA OF THE ASSESSEE EXCEPT STATI NG TO BE UNACCEPTABLE. IN SUCH CIRCUMSTANCES, CONSTITUTING REASONABLE CAUSE WITHIN THE MEANING OF RULE 46A OF THE I T RULES, THE ADDITIONAL EVIDENCES ARE ACCEPTED AND ADJUDICATED IN THE SUCCEEDING PARAGRAPHS FROM PARA 12 TO 20 BY GIVING PART RELIEF TO THE ASSESSEE TO THE TUNE OF RS.21,37,000/ - AND ADDITION OF RS.45,500/- WAS SUSTAINED. 7. AGGRIEVED BY THIS ORDER OF LD. CIT(A), DEPARTMEN T HAS COME UP IN APPEAL AND RAISED FOLLOWING TWO EFFECTIVE GROUNDS: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN:- I) DELETING THE ADDITION OF RS.21,82,500/- RIGHTLY MAD E BY THE A.O. ON ACCOUNT OF UNEXPLAINED CASH DEPOSIT IN THE ASSESSEES BANK ACCOUNT TREATED AS INCOME FROM UNDISCLOSED SOU RCES. II) ACCEPTING THE ADDITIONAL EVIDENCE/JUSTIFICATION FIL ED BY THE ASSESSEE WHICH WAS NOT PRODUCED DURING THE COURSE O F ASSESSMENT PROCEEDINGS. 8. LD. D.R. WHILE CHALLENGING THE ORDER OF LD. CIT( A) HAS RELIED UPON THE ORDER OF THE A.O. AND PLEADED THAT THE ORDER OF LD. CIT(A) SHOULD BE SET ASIDE ANT THAT OF THE A.O. SHOULD BE RESTORED ON TH IS ISSUE WHEREAS, LD. COUNSEL FOR THE ASSESSEE RELIED UPON THE ORDER OF L D. CIT(A) AND HAS PLEADED FOR CONFIRMATION OF THE IMPUGNED ORDER. 9. WE HAVE HEARD BOTH THE SIDES, CONSIDERED THE MAT ERIAL ON RECORD AND FIND THAT THE A.O. ON NOT FINDING ANY COMPLIANCE OF NOTICES, PROCEEDED WITH THE ASSESSMENT BY MAKING THE ADDITION OF THE WHOLE OF THE SUM OF RS.21,82,500/- AND STATED TO BE IN CONFORMITY WITH THE INFORMATION RECEIVED FROM CASS. A LETTER OF CONFIRMATION FORM ANOOP SER VICE STATION SHOWING DATE WISE CHEQUE NUMBER AND AMOUNT FORM ASSESSEE, A LONG WITH THEIR PAN, I.T.A. NOS.138/DEL/2012 I.T.A. NO. 3846/DEL/2013 5 COPY OF ITR, COMPUTATION OF INCOME, THEIR BALANCE S HEET AND PROFIT & LOSS ACCOUNT ETC. IN THEIR CONFIRMATION THEY HAVE CONFI RMED TO HAVE RECEIVED AN AGGREGATE SUM OF RS.21,37,000/- AND THUS HAVE CONFI RMED TO HAVE BEEN THE BENEFICIAL OWNER OF THE CASH DEPOSITS IN THE BANK A CCOUNT OF THE ASSESSEE. IN THE REMAND REPORT, THE A.O. HAS STATED THAT THE ASS ESSEE HAS TOTALLY FAILED TO SUBMIT ANY COGENT, CONVINCING AND REASONABLE EVIDEN CE TO SUPPORT THE CONTENTION THAT HE CASH BELONGS TO EMPLOYER OF THE ASSESSEE I.E. M/S. ANUP SERVICE STATION. THE CONTENTION OF THE ASSESSEE T HAT IMPUGNED CASH WERE OUT OF SALE PROCEEDS COLLECTED BY ASSESSEE ON BEHAL F OF HIS EMPLOYER M/S. ANUP SERVICE STATION WAS NOT SUPPORTED BY ANY CORRO BORATING EVIDENCE LIKE NAME & ADDRESS OF THE PERSONS FORM WHOM THE CASH WA S ALLEGEDLY COLLECTED. WHEREAS, ON THE CONTRARY, ON BEHALF OF THE ASSESSEE , IT WAS SUBMITTED THAT THE ASSESSEE HAS OFFERED EXPLANATION WHICH IS NOT ONLY REASONABLE IN VIEW OF HIS EMPLOYMENT AND SURROUNDING CIRCUMSTANCES, BUT ALSO IS FULLY AND UNDISPUTEDLY DOCUMENTED & CORROBORATED BY WAY OF BA NKING CHANNELS AND CONFIRMATION OF THE EMPLOYER WHO UNDERTOOK THE BENE FICIAL OWNERSHIP OF ALL THE CASH DEPOSITS IN ASSSSEES ACCOUNT. THEREFORE, EVEN IF, FOR THE SAKE OF ARGUMENT, SUCH EXPLANATION STILL REMAINS UNSATISFAC TORY, THE ADVERSE VIEW, IF ANY, IS TO BE TAKEN AGAINST THE EMPLOYER AND NOT AG AINST THE EMPLOYEE WHO MERELY ACTED ON THE INSTRUCTIONS OF HIS EMPLOYERS A ND FOR THEIR BENEFITS ALONE. SINCE THE ASSESSEE HAS ACTED AS AN AGENT ON BEHALF OF HIS EMPLOYER, TO COLLECT CASH FOR HIS EMPLOYER AND, THEREFORE, ALL C USTOMERS WOULD ONLY HAVE ACCOUNT OF ANUP SERVICE STATION IN THEIR BOOKS, AND ASSESSEES NAME SHALL NEVER APPEAR IN THEIR BOOKS OF ACCOUNTS AND THEREFO RE, A.O. IS WRONG, IMPRACTICAL AND MISPLACED. LETTERS WERE ALSO FILED BY THE ASSESSEE AT THE TIME OF APPEAL PROCEEDINGS WHICH WERE ISSUED BY SOM E PARTIES TO CONFIRM I.T.A. NOS.138/DEL/2012 I.T.A. NO. 3846/DEL/2013 6 THE FACT THAT THE ASSESSEE WAS EMPLOYEE OF ANUP SER VICE STATION AND USED TO COLLECT THE CASH ON THEIR BEHALF. IT WAS ALSO SUBM ITTED THAT SIMILAR ISSUE HAS ALSO AROSE IN ASSESSMENT YEAR 2009-10 IN WHICH CASE ALL PAYMENTS AGAINST CASH DEPOSITS HAVE BEEN MADE IN FAVOUR OF BHARAT PE TROLEUM. THIS IS CORROBORATED WITH STATEMENT OF ACCOUNTS OF ANUP SER VICE STATION IN THEIR BOOKS. 10. TAKING INTO ACCOUNT ALL THE FACTS CIRCUMSTANCES AND MATERIAL ON RECORD AND THE ARGUMENTS AS ADVANCED BY LD. COUNSEL FOR TH E ASSESSEE, LD. CIT(A) HAD PASSED A WELL REASONED AND SPEAKING ORDER WHICH IS REPRODUCED IN EARLIER PARAGRAPHS TO DELETE THE ADDITION OF RS.21, 37,000/- OUT OF RS.21,82,500/- AS IT IS GLORIFIABLE WITH THE DOCUME NTARY EVIDENCE. THEREFORE WE DO NOT FIND ANY JUSTIFIABLE REASON TO INTERFERE IN THE ORDER PASSED BY LD. CIT(A) WHICH IS FOUND TO BE JUST AND APPROPRIATE. THEREFORE WHILE UPHOLDING THE ORDER O LD. CIT(A), WE DISMISS THE AP PEAL OF THE REVENUE BEING DEVOID OF ANY MERIT. 11. AS REGARDS APPEAL IN I.T.A. NO. 3846/DEL/2013 F OR THE ASSESSMENT YEAR 2009-10 IS CONCERNED, CHALLENGE OF THE DEPARTM ENT IS WITH REGARD TO DELETION NO ADDITION OF RS.18,26,717/- ON ACCOUNT O F UNEXPLAINED CASH DEPOSIT. LD. CIT(A), IN APPEAL AGAINST ORDER OF AS SESSMENT, WITH REGARD TO ADDITION OF RS.18,58,900/- ADDITION WAS UPHELD TO T HE EXTENT OF RS.18,26,717/- WHEREAS ADDITION TO THE EXTENT OF RS .32,183/- WAS SUSTAINED. NO PLAUSIBLE EXPLANATION HAS BEEN OFFERED WHEN THE FACTS AND CIRCUMSTANCES OF THE CASE IN HAND AND THE CASE FOR 2008-09 ARE SI MILAR. IT WAS PLEADED BY LD. COUNSEL FOR THE ASSESSEE THAT ON THE SAME BASIS AND SIMILAR FACTS FOR THE ASSESSMENT YEAR 2008-09, THE IMPUGNED ADDITION OFDR S.21,37,000/- WAS DELETED WHILE UPHOLDING RS.45,500/-. SINCE, THE FA CTS AND CIRCUMSTANCES OF I.T.A. NOS.138/DEL/2012 I.T.A. NO. 3846/DEL/2013 7 THE CASE IN HAND ARE THE SAME AND THE ISSUE INVOLVE D IS IDENTICAL, THEREFORE, APPLYING THE SAME YARDSTICK, THE ORDER OF LD. CIT(A ) FOR THE YEAR UNDER CONSIDERATION SHOULD BE UPHELD AND APPEAL OF THE RE VENUE MAY BE DISMISSED. 12. LD. D.R. DID NOT SERIOUSLY OBJECT AND JUST RELI ED UPON THE ORDER OF THE A.O. AND PLEADED FOR ITS RESTORATION. 13. AFTER HAVING HEARD BOTH THE SIDES AND CONSIDERI NG THE MATERIAL ON RECORD. WE FIND THAT THE FACTS AND CIRCUMSTANCES O F THE CASE IN HAND AND THE CASE DECIDED FOR THE ASSESSMENT YEAR 2008-09 AND AT THE MOST, THE ISSUE IS IDENTICAL WHERE PART ADDITION WAS SUSTAINED AND MAJ OR ADDITION WAS DELETED WHEN ALL THE MATERIAL WAS PRODUCED WHICH WAS CONSID ERED TO DELETE THE IMPUGNED PART OF ADDITION MADE BY THE A.O. AGAINST WHICH NO CONTRARY MATERIAL HAVE BEEN FURNISHED, THEREFORE, WHILE FOLL OWING THE DECISION TAKEN BY US IN EARLIER APPEAL, WE UPHOLD THE ORDER OF LD. CIT(A) AND DISMISS THE APPEAL OF THE REVENUE. 14. AS A RESULT, BOTH THE APPEALS OF THE REVENUE AR E DISMISSED. 15. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH JAN., 2014. SD./- SD./- (B. C. MEENA) (U.B.S.BEDI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATE: 30 .01.2014. SP. COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A)-XXV, NEW DELHI AR, ITAT, 5. CIT(ITAT), NEW DELHI NEW DELHI