ACIT, New Delhi V. Shri Akhilesh Aggarwal, New Delhi

ITA 4099/DEL/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 7009 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 7 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-02-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 02-02-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 03-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: REKHA VIMAL
• Keywords: Opportunity of being heard; Source of fund; Additional evidence
• Section: 6; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH B NEW DELHI BEFORE SHRI S.V. MEHROTRA : ACCOUNTANT MEMBER AND SHRI A.T. VARKEY: JUDICIAL MEMBER ITA NO. 4099/DEL/2013 ASSTT. YR: 2009-10 ACIT, CIRCLE-47(1), VS. AKHILESH AGGARWAL, NEW DELHI. 40, MEMORIAL HWY APARTMENT, 20N, NEW ROCHELLE, NEW YORK-10801 (LOCAL ADDRESS: M-46, GREATER KAILASH-I, NEW DELHI) PAN: ACUPA 44496 Q ( APPELLANT ) (RESPONDENT) APPELLANT BY : MS. REKHA VIMAL DR RESPONDENT BY : SHRI R.S. SINGHVI CA & SH. SATYAJIT GOEL CA DATE OF HEARING : 02/02/2016. DATE OF ORDER : 22/02/2016. O R D E R PER S.V. MEHROTRA, A.M: THIS IS REVENUES APPEAL AGAINST THE ORDER DATED 8. 4.2013 PASSED BY THE LD. CIT(A)-XXX, NEW DELHI IN APPEAL NO. 3469/ 11-12, RELATING TO A.Y. 2009-10. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HA D FILED RETURN OF INCOME DECLARING TOTAL INCOME OF RS. 10,63,970/- THE CASE WAS SELECTED FOR SCRUTINY THROUGH CASS SYSTEM/ AIR INFORMATION. AS PER THE IN FORMATION, THE 2 ASSESSEE HAD MADE PAYMENT OF RS. 33,64,665/- TOWARD S VARIOUS CREDIT CARDS AS UNDER: 1. RS. 2,00,870/- AGAINST CITI BANK NA 2. RS. 5,01,270/- AGAINST DENTSCHE BANK KODAK HOUSE 3. RS. 16,31,506/- AGAINST CITI BANK, NA 4. RS. 3,41,600/- AGAINST CITY BANK NA 5. RS. 3,06,000/- AGAINST DEUTSCHE BANK, KODAK HOUS E 6. RS. 3,83,419/- AGAINST ABN AMRO TOTAL RS. 33,64,665/- 3. AS ASSESSEE DID NOT FILE ANY EXPLANATION WITH SU PPORTING DOCUMENTS, THE AO MADE ADDITION OF RS. 33,64,665/- U/S 69C. 4. LD. CIT(A) ALLOWED THE ASSESSEES APPEAL ON 2 CO UNTS, VIZ. (I) THE ITO WARD 1(1), GURGAON WAS NOT EMPOWERED TO TRANSFE R THE JURISDICTION OF THE CASE TO DCIT CIRCLE 47(1), NEW DELHI AS NO ORDE R U/S 127 WAS PASSED AND, HENCE, THE ASSESSMENT ORDER PASSED BY DCIT CIR CLE 47(1), NEW DELHI, WAS WITHOUT JURISDICTION; AND (II) THE PAYMENTS OF CREDIT CARDS WERE FROM EXPLAINABLE SOURCE OF INCOME I.E. ASSESSEES SALARY AND HIS BROTHERS PARTNERSHIP FIRM M/S 4 GENIUS MINDS, WHO HAD USED THE CREDIT CARDS AND PAID FROM THE PARTNERSHIP FIRM. HE FURTHER NOTED TH AT THE ASSESSEE WAS WORKING IN USA AND SETTLED THERE. 5. BEING AGGRIEVED, THE DEPARTMENT IS IN APPEAL BEF ORE US AND HAS TAKEN FOLLOWING GROUNDS OF APPEAL: 3 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT{A} HAS ERRED IN: 1. QUASHING THE ORDER PASSED U/S 144 ON THE GROUND THAT THE JURISDICTION OVER THE CASE WAS NOT TRANSFERRED BY PASSING ORDER U/S 127 WHEREAS THE FACT THAT THE PAN OF THE ASSESSEE WAS LYING WITH THE ACIT, CIR.47{1}, NEW DELHI. 1. ALLOWING THE APPEAL OF THE ASSESSEE WITHOUT PROV IDING AN OPPORTUNITY TO PUT FORTH THE VIEW POINT OF THE DEPA RTMENT {BY CALLING REMAND REPORT} AND ADMITTING THE ADDITIONAL EVIDENCES UNDER RULE 46A OF THE I.T.ACT, 1962 WITHOUT PROVIDI NG OPPORTUNITY TO AO AS REQUIRED UNDER SUB RULE 3 OF R ULE 46. 3. DELETING THE ADDITION OF RS.33,64,655/- MADE BY THE AO ON ACCOUNT OF INVESTMENT THROUGH CREDIT CARDS U/S 6 9C BY HOLDING THAT THE TRANSACTION IN RESPECT OF PAYMENT MADE ON ACCOUNT OF CREDIT CARDS AS GENUINE AD LEGITIMATE WI THOUT CONSIDERING THE FACT THAT THE ASSESSEE HAS NOT FILE D ANY IOTA OF EVIDENCE DURING THE COURSE OF ASSESSMENT PROCEEDING S. 4. THE APPELLATE CRAVES THE RIGHT TO ALTER, AMEND, ADD OR SUBSTITUTE THE GROUNDS OF APPEAL. 6. LD. DR REFERRED TO PAGE 4 OF THE PAPER BOOK WHE REIN THE LETTER FROM ITO WARD 1(1), GURGAON TO DCIT CIRCLE 47(1) DATED 1 8/23.11.2011 IS CONTAINED AND POINTED OUT THAT THE CASE WAS TRANSFE RRED TO DCIT CIRCLE 47(1), NEW DELHI ON THE BASIS OF DETAILS IN PAN DAT A BASE AS PER WHICH THE JURISDICTION LAY WITH DCIT CIRCLE 47(1), NEW DELHI. SHE SUBMITTED THAT UNDER SUCH CIRCUMSTANCES, THERE WAS NO REQUIREMENT OF PASSING ORDER U/S 127. ON MERITS, LD. DR SUBMITTED THAT CIT(A) WRONGL Y ACCEPTED THE 4 ADDITIONAL EVIDENCE AND DELETED THE ADDITION WITHOU T AFFORDING OPPORTUNITY TO AO. 7. LD. COUNSEL FOR THE ASSESSEE RELIED ON THE ORDER OF CIT(A) AND REFERRED TO PAGES 5 TO 9 OF THE PAPER BOOK, WHEREIN THE DEPA RTMENTS INSTRUCTIONS REGARDING FILING OF RETURN ARE CONTAINED, IN WHICH IT IS, INTER ALIA, STATED AS UNDER: WHETHER THE ADDRESS GIVEN IN THE PAN CARD IS TO BE QUOTED OR THE CURRENT ADDRESS WHICH MAY BE DIFFERENT FROM THE PAN CARD ADDRESS CAN ALSO BE QUOTED? ANSWER: THE ASSESSEE HAS TO QUOTE THE CURRENT ADDRE SS ON THE RETURN FORMS. 8. HE, THEREFORE, SUBMITTED THAT WITHOUT FULFILLIN G THE REQUIREMENT CONTAINED U/S 127, THE CASE COULD NOT BE TRANSFERRE D FROM THE JURISDICTION OF ONE COMMISSIONER TO THE OTHER COMMISSIONER. ON MER ITS LD. COUNSEL SUBMITTED THAT RETURNED INCOME OF ASSESSEE WAS RS. 10 LACS AND ODD AND THE PAYMENTS HAD BEEN MADE THROUGH CHEQUES FROM EXPLAIN ABLE SOURCES OF INCOME, WHICH LD. CIT(A) HAS CONSIDERED AND THEN DE LETED THE ADDITION. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE RECORD OF THE CASE. AS FAR AS THE JURISDICTION FOR PASSING TH E ASSESSMENT ORDER BY ACIT, CIRCLE 47(1) IS CONCERNED, WE FIND THAT ORIGINAL NO TICE U/S 143(2) WAS ISSUED BY ACIT CIRCLE 1(1), GURGAON ON 25.8.2010 AT THE AD DRESS OF THE ASSESSEE GIVEN IN THE RETURN OF INCOME, WHICH WAS OF GURGAON , AS IS EVIDENT FROM THE 5 COPY OF ACKNOWLEDGEMENT CONTAINED AT PAGE 3 OF PB, WHEREIN THE ADDRESS GIVEN IS AS UNDER: 31A, SECTOR-18, UDYOG VIHAR, GURGAON (HARYANA). 10. LD. CIT(A) HAS ALSO POINTED OUT THAT ITO WARD 1 (1) NOTED IN THE NOTICES DATED 8.6.2011 AND 26.8.2011 THAT THE JURIS DICTION OF THE CASE OF THE ASSESSEE LAY WITH ITO WARD 1(1), GURGAON AS PER INS TRUCTION NO. 1/2011 DATED 31.1.2011 ISSUED BY THE CBDT AND ALSO IN VIEW OF ORDER OF COMMISSIONER BEARING NO. F. NO. CIT/FBD/JURISDICTIO N/2011-12/850-73 DATED 13.05.2011. THEREFORE, JURISDICTION PRIMARILY WAS WITH ACIT CIRCLE 1(1), GURGAON. THE ADDRESS GIVEN IN PAN CANNOT DECI DE THE JURISDICTION OF AO. IN THIS REGARD WE MAY REFER TO SECTION 120 WHIC H DEALS WITH JURISDICTION OF AO. THE JURISDICTION OF AO U/S 120 IS DECIDED PR IMARILY ON THE BASIS OF FOLLOWING CRITERIA: (A) TERRITORIAL AREA; (B) PERSONS OR CLASSES OF PERSONS; (C) INCOME OR CLASSES OF INCOME; AND (D) CASES OR CLASSES OF CASES. 11. NONE OF THESE CRITERIAS GIVES THE CRITERIA OF PAN DATA BASE. THEREFORE, MERELY ON THE BASIS OF PAN DATA BASE, THE JURISDICT ION OF AO CANNOT BE DECIDED. IN THE PRESENT CASE ADMITTEDLY THE ASSESSE E HAD FILED THE RETURN GIVING GURGAON ADDRESS AND, THEREFORE, ON THE BASI S OF TERRITORIAL AREA, THE 6 JURISDICTION LAY WITH ACIT CIRCLE 1(1), GURGAON. TH IS JURISDICTION COULD NOT BE TRANSFERRED TO DCIT CIRCLE 47(1), NEW DELHI WITH OUT THE ORDER BEING PASSED U/S 127, AS PER WHICH THE COMMISSIONER HAS T O PROVIDE A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND RECO RD HIS REASONS BEFORE THE CASE IS TRANSFERRED TO THE JURISDICTION OF ANOTHER COMMISSIONER, WE, THEREFORE, ARE IN AGREEMENT WITH THE FINDINGS OF LD . CIT(A) THAT THE ASSESSMENT ORDER PASSED BY AO OF CIRCLE 47(1), NEW DELHI WAS WITHOUT JURISDICTION, HENCE THE ORDER IS BAD IN LAW. GROUND NO. 1 IS DISMISSED. 12. AS WE HAVE CONFIRMED THE FINDING OF LD. CIT(A) IN QUASHING THE ASSESSMENT ORDER, THERE IS NO NEED TO GO INTO THE M ERITS OF THE CASE AND, THEREFORE, GROUND NOS. 2 AND 3 RAISED BY THE DEPART MENT HAVE BECOME INFRUCTUOUS. GROUND NO. 4 IS GENERAL IN NATURE. 13. IN THE RESULT, DEPARTMENTS APPEAL IS DISMISSED . ORDER PRONOUNCEMENT IN OPEN COURT ON 22/02/2016. SD/- SD/- (A.T. VARKEY) (S.V. MEHROTRA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 22/02/2016. *MP* COPY OF ORDER TO: 1. ASSESSEE 2. AO 3. CIT 4. CIT(A) 5. DR, ITAT, NEW DELHI.