Swami Nath Tiwari, New Delhi V. ITO, New Delhi

ITA 3884/DEL/2013

• Counselvise Citation: 388420114 RSA 2013
• Duration Of Justice: 1 year(s) 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-01-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 08-01-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 18-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SATPAL SINGH
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: G NEW DELHI BEFORE SMT DIVA SINGH, JUDICIAL MEMBER AND SH. B.C.MEENA, ACCOUNTANT MEMBER I.T.A .NO.3884 /DEL/201 3 (ASSESSMENT YEAR - 2 009 - 10 ) SWAMI NATH TIWARI, PROP M/S ANJANI AIR CARGO, E - 40, STREET NO. - 1, WEST VINOD NAGAR, DELHI - 110092. P AN - ADMPT6538P (APPELLANT) VS ITO, WARD - 39(4), NEW DELHI. (RESPONDENT) APPELLANT BY NONE RESPONDENT BY SH.SATPAL SINGH, SR. DR ORDER PER DIVA SINGH, JM THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER DATED 22 . 02.2013 OF CIT(A) - XXVIII , N EW DELHI PERTAINING TO 200 9 - 1 0 ASSESSMENT YEAR . NO ONE WAS PRESENT ON BEHALF OF THE ASSESSEE AT THE TIME OF HEARING. HOWEVER ON A PERUSAL OF THE MATERIAL AVAILABLE ON RECORD IT WAS CONSIDERED APPROPRIATE TO PROCEED WITH THE PRESENT APPEAL EX - PARTE QUA THE ASSESSEE APPELLANT ON MERITS. THE RECORD SHOWS THAT THE ASSESSEE RETURNED AN INCOME O F RS. 2,82,357/ - BY WAY OF FILING OF RETURN ON 30.09.2009 WHICH WAS SE LECTED FOR SCRUTINY THROUGH CASS ON THE BASIS OF AIR INFORMATION RECEIVED. ACCORDINGLY AFTER ISSUANCE OF NOTICE U/S 143(2) ETC. THE ASSESSMENT ORDER WAS PASSED WHEREIN BY WAY OF THE ADDITIONS MADE ASSESSMENT WAS CONCLUDED ON AN INCOME OF RS.9,23,567/ - . THE RECORD SHOWS THAT CONSIDERING THE ASSESSEE S CLAIM OF PAYMENT FOR RENT AMOUNTING TO RS.4,62,000/ - , THE AO IN ORDER TO VERIFY THE GENUINENESS OF THE RENT CLAIM TO HAVE BEEN PAID TO SH. A.K.BHUTANI ISSUED NOTICE U/S 133(6) AND CONSIDERING THE REPLY DATED 12.12.2011 CONCLUDED THAT THE ASSESSEE HAD EX C ESSIVELY CLAIMED EXPENSES IN ORDER TO REDUCE ITS 2 I.T.A .NO. - 3884 /DEL/2013 TAXABLE I N C O M E . FOR READY - REFERENCE THE RELEVANT EXTRACT FROM THE ASSESSMENT ORDER IS REPRODUCED HEREUNDER: - FURTHER IN ORDER TO VERIFY THE GENUINENESS OF RENT CLAIMED TO HAVE BEEN PAID TO SH.A.K.BHUTANI, NOTICE U/S. 133(6) HAS BEEN SENT TO SH.A.K.BHUTANI. IN RESPONSE TO SAID NOTICE SH.J.P.BHUTANI VIDE LETTER DATED 12.12.2011 INTIMATED THIS OFFICE THAT THE ABOVE SAID PREMISES AT 7293, GALI NO.1, ARAM N AGAR, Q U TUB ROAD, DELHI - 110055 COMPRISES OF ONE ROOM ON THE GROUND FLOOR HAS BEEN LET OUT TO M/S ANJANI AIR CARGO, PROPRIETOR MR. SWAMI NATH TIWARI AT A MONTHLY RENT OF RS.3,200/ - ONLY. WHEREAS THE ASSESSEE HAS CLAIMED THAT HE PAID RS.9,000/ - PER MONTH AS RENT AND RS.42,000/ - PER ANNUM AS REPAIR AND MAINTENANCE CHARGES TO S H .A.K.BHUTANI AND CLAIMED EXPENDITURE UNDER THE HEAD RENT EXCESSIVELY BY RS.1,11,600/ - 2. A PERUSAL OF THE GROUNDS RAISED BY THE ASSESSEE BEFORE THE CIT(A) SHOWS THAT THE ORDER PASSED BY THE AO DATED 24.12.2011 WAS A S S A I L E D TO BE AN EX - PARTE ORDER. FOR THE SAME, GROUND NO. - 1 I S REPRODUCED HEREUNDER: - 1. THAT THE EX - PARTE ASSESSMENT ORDER DATED 24.12.2011 FRAMED BY LD. ITO WARD - 26(3), NEW DELHI IS AGAINST THE LAW AND FACTS OF THE CASE. 3. A PERUSAL OF THE IMPUGNED ORDER SHOWS THAT THE CIT(A) DISMISS E D THE CONTENTION OF THE ASSESSEE THAT IT WAS AN EX - PARTE ORDER IN VIEW OF THE FACT THAT THE ORDER STATED THAT IT IS PASSED U/S 143(3). THE OTHER GROUNDS I.E GROUND NOS. - 2 & 3 BEFORE THE CIT (A) WERE DISMISSED AS NO T REQUIRING A DJUDICATION, THE SAME ARE REPRODUCED HEREUNDER FOR READY - REFERENCE: - 2. THAT THE LD. ITO 39(4) NEW DELHI HAS ERRED IN LAW IN FRAMING THE ASSESSMENT ORDER WITHOUT AFFORDING THE PROPER AND SUFFICIENT OPPORTUNITY TO THE ASSESSEE TO PLEAD AND REPRESENT HIS CASE AND TO FILL THE RELEVANT PAPERS AND DOCUMENTS IN CONNECTION WITH THE ASSESSMENT PROCEEDINGS. 3. THAT THE LD. ITO, WARD - 39(4), NEW DELHI HAS NOT FOLLOWING THE RULES AND PRINCIPLES OF NATURAL JUSTICE BEFORE FRAMING TH E ASSESSMENT ORDER. 4. IN VIEW OF THE A B O V E THAT THE ADDITION MADE BY THE AO WAS SUSTAINED. WE HAVE HEARD THE LD. SR. DR WHO PLACED RELIANCE ON THE IMPUGNED ORDER. HOWEVER ON CONSIDERATION OF THE MATERIAL AVAILABLE ON RECORD, WE ARE OF THE VIEW THAT IN THE INTEREST S OF SUBSTANTIAL JUSTICE THE ORDERS OF THE CIT(A) AND THE AO DESERVE TO BE SET ASIDE. THE ISSUE IS RESTORED BACK TO THE FILE TO THE AO. CONSIDERING GROUND NO. - 3 RAISED BEFORE US DIRECTING THE AO TO DECIDE THE ISSUES BY WAY OF A SPEAKING ORDER DENOVO IN ACCORDANCE WITH LAW AFTER GIVING THE ASSESSEE A REASONABLE 3 I.T.A .NO. - 3884 /DEL/2013 OPPORTUNITY OF BEING HEARD. THE SAID ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF THE PARTIES. 5 . IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWED. THE ORDER IS PRONOUNCE D IN THE OPEN COURT ON 1 9 T H OF JANUARY 2015 . S D / - S D / - ( B.C.MEENA ) (DIVA SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 1 9 / 01 /201 5 *AMIT KUMAR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI 4 I.T.A .NO. - 3884 /DEL/2013 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN LAW IN BRINGING TO TAX THE AMOUNT PAID AS RENT AND MAINTENANCE CHARGES AMOUNTING TO RS.462000.00 ON WHICH PURPORTEDLY NO TAX HAS BEEN DEDUCTED AT SOURCE UNDER THE PROVISIONS OF SECTION 194I OF THE ACT 2. THAT AS PER LAW THE APPELLANT DID NOT FAL L UNDER THE PURVIEW OF SECTION 194 I OF THE ACT AS ACCORDING TO THE FACTS AVAILABLE ON RECORD, HE HAD PAID RENT TO 3 DIFFERENT PERSONS WHICH WAS SEPARATELY BELOW RS. ONE LAKH TWENTY THOUSAND IN A FINANCIAL YEAR AND BOTH THE ASSESSING OFFICER AS WELL AS THE LEARNED CIT(A) HAVE ERRED ON THIS ACCOUNT; 3. THAT THE PURPORTED STATEMENT OF ONE, MR. J.P.BHUTANI, ON BEHALF OF THE LANDLORD SHRI A.K.BHUTANI, WHO HAS STATED THE RENT PAID AS RS.3200.00 PER MONTH, HAS BEEN RELIED BY THE ASSESSING OFFICER BEHIND THE BACK OF THE APPELLANT AND FLOUTING THE PRINCIPLES OF NATURAL JUSTICE BY NOT AFFORDING AN OPPORTUNITY TO HIM FOR CROSS EXAMINATION ETC. AND TO THAT EXTENT THE ORDER PASSED BY THE ASSESSING OFFICER AND UPHELD BY THE CIT(A IS BAD IN LAW;