Harendra Malik , Muzaffarnagar V. ITO, Ward- 1(2), Muzaffarnagar

ITA 4302/DEL/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 1282 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 6 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-12-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 05-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Principle of natural justice; Set aside
• Section: 234B; 147

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL, DELHI BENCH SMC, NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER ITA NO. 4302/D EL/2018 AY 200 9-10 HARENDRA MALIK, 57/1, PREM PURI, MUZAFFARNAGAR UTTAR PRADESH (PAN:AKAPM1401D) ( APPELLANT) VS ITO, WARD 1(2), MUZAFFARNAGAR (RESPONDENT) APPELLANT BY SH. ANKIT GUPTA, ADV. RESPONDENT BY SH. PRADEEP SINGH GAUTAM, SR. DR ORDER THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE ORDER DATED 26.3.2018 PASSED BY LD. CIT(A), MUZAFFARNAGAR FOR ASSE SSMENT YEAR 2009-10. 2. THE GROUNDS RAISED IN THE APPEAL READ AS UNDER:- 1. THAT THE NOTICE ISSUED ULS 148 AND REASSESSMENT ORDER PASSED U/S 147 R. W .S. 144 ARE ILLEGAL, BAD IN LAW AN D WITHOUT JURISDICTION. 2. THAT, IN VIEW OF THE FACTS AND CIRCUMSTANCES, NO SATISFACTION IS RECORDED BY THE ASSESSING OFFICER AS. REQUIRE D ULS 147/148 OF THE ACT PRIOR ISSUING THE NOTICE UNDER SECTION 147 OF THE INCOME TAX ACT, 1961. 3. THAT, NO SATISFACTION HAS BEEN RECORDED BY THE ASSESSIN G OFFICER AFTER APPLICATION OF MIND ON THE BASIS OF TANGI BLE MATERIAL, WHICH HAVE LIVE NEXUS TO THE INCOME, WHICH HAVE ESCAPED ASSESSMENT AND MERELY RELIED ON THE INFORMATION RECEIVED FROM 2 AIR, WHICH IS VAGUE, INCORRECT AND BASELESS, HENCE, THE PROCEEDINGS INITIATED IS ILLEGAL, BAD IN LAW AND WITHO UT JURISDICTION. THE CIT (A) HAS ERRED IN UPHOLDING THE V ALIDITY OF THE PROCEEDINGS INITIATED U/S 147 READ WITH SECTION 148. 4. THE ADDITION/ DISALLOWANCES MADE BY THE ASSESSING OFFICE R ARE ILLEGAL, UNJUST, HIGHLY EXCESSIVE AND ARE. NOT BASE D ON ANY MATERIAL ON RECORD BY THE ASSESSING OFFICER. THE TOTAL IN COME OF THE APPELLANT HAS BEEN WRONGLY AND ILLEGALLY COMPUTED BY THE ASSESSING OFFICER AT RS.19,51,500.00 AS AGAINST DECLARED IN COME OF RS.1,66,270.00. THE CIT (A) HAS ERRED IN CONFIRMIN G THE ADDITION TO RS.17,26,500.00, WHICH IS HIGHLY ARBITRARY AND UNJUSTIFIED. 5. THAT, THE ASSESSING OFFICER HAS FAILED TO APPRECIATE, THAT, THE SOURCE OF CASH DEPOSIT HAS BEEN EXPLAINED, THAT, THE AMOUNT HAS BEEN WITHDRAWAL TIME TO TIME FROM SAME BAN K ACCOUNTS AND AGRICULTURE INCOME, WHICH IS UNDER DISPUT E, HENCE, THE ADDITION MADE BY THE ASSESSING OFFICER AND UPHELD B Y THE CIT (A) IS PURELY BASED ON PRESUMPTION AND SURMISES AND CONJECT URE WITHOUT APPRECIATING THE FACTS OF THE CASE. 6. THAT THE ASSESSING OFFICER/CIT(A), IN VIEW OF THE FACT S AND CIRCUMSTANCES OF THE CASE ERRED ON FACTS AND IN LAW IN MAKI NG THE AD-HOC ADDITION DISALLOWANCE ON ESTIMATED BASIS, WHI CH IS UNJUST, ARBITRARY, UNLAWFUL, HIGHLY EXCESSIVE, BASED O N SURMISES AND CONJECTURES AND CANNOT BE JUSTIFIED BY ANY MATERIAL ON RECORD. 7. THE ADDITIONS CONFIRMED AND THE OBSERVATIONS MADE BY CIT (A) ARE UNJUST, UNLAWFUL AND BASED ON MERE SURMISES AND CONJUNCTURES. THE ADDITIONS MADE CANNOT BE JUSTIFIED BY ANY MATERIAL ON RECORD . 3 8. THAT THE EXPLANATION GIVEN EVIDENCE PRODUCED, MATE RIAL PLACED AND AVAILABLE ON RECORD HAS NOT BEEN PROPERLY CO NSIDERED AND JUDICIALLY INTERPRETED AND THE SAME DO NOT JUST IFY THE ADDITIONS/ ALLOWANCES MADE. 9. THAT THE IMPUGNED ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER AND ORDER PASSED BY CIT(A) ARE AGAINST TH E PRINCIPLES OF NATURAL JUSTICE AND THE SAME HAS BEEN PASSED WITHOUT AFFORDING REASONABLE AND ADEQUATE OPPORTUNIT Y OF BEING HEARD. 10.THAT THE INTEREST U/S 234A & 234B HAS BEEN WRONGLY AND ILLEGALLY CHARGED AS THE APPELLANT COULD NOT HAVE FOR ESEEN THE DISALLOWANCES/ADDITIONS MADE AND COULD NOT HAVE INCLUDED THE SAME IN CURRENT INCOME FOR PAYMENT OF ADVANCE TAX. THE INTEREST CHARGED UNDER VARIOUS SECTIONS IS ALSO WRONGLY WORKED OUT. 11. THE APPELLANT CRAVES LEAVE TO ADD, AMEND, ALTER A ND OR MODIFY THE GROUNDS OF APPEAL OF THE SAID APPEAL. ALL OF THE ABOVE GROUNDS OF APPEAL ARE WITHOUT PREJU DICE AND ARE MUTUALLY EXCLUSIVE TO EACH OTHER. 3. THE BRIEF FACTS OF THE CASE ARE THAT IN THE ASSESSMENT O RDER PASSED U/S. 144/147/143(3) OF THE INCOME TAX ACT, 1961 (IN SHO RT ACT) DATED 04.11.2016, THE AO HAS MADE THE ADDITION OF RS. 19,51 ,500/- ON ACCOUNT OF UNEXPLAINED CASH DEPOSIT IN THE BANK ACCOUNT. AGAINST THE ASSESSMENT ORDER, THE ASSESSEE APPEALED BEFORE THE LD. CIT(A), WH O VIDE HIS IMPUGNED ORDER DATED 26.03.2018 HAS DISMISSED THE APPEAL OF THE ASSESSEE. 4. BEING AGGRIEVED BY THE SAME, THE ASSESSEE IS BEFORE TH E TRIBUNAL. 4 5. AT THE TIME OF HEARING, LD. COUNSEL OF THE ASSESSEE HAS STATED THAT THE NOTICE ISSUED U/S 148 AND REASSESSMENT ORDER PASSED U/S. 147 R. W .S. 144 ARE ILLEGAL, BAD IN LAW AND WITHOUT JURISDICTION. IT WAS FURTHER STATED THAT IN VIEW OF THE FACTS AND CIRCUMSTANCES, NO SATISFACTI ON IS RECORDED BY THE ASSESSING OFFICER AS REQUIRED ULS 147/148 OF THE ACT P RIOR ISSUING THE NOTICE UNDER SECTION 147 OF THE INCOME TAX ACT, 1961. I T WAS THE FURTHER CONTENTION THAT NO SATISFACTION HAS BEEN RECORDED BY THE ASSESSING OFFICER AFTER APPLICATION OF MIND ON THE BASIS OF TANGIBLE MAT ERIAL, WHICH HAVE LIVE NEXUS TO THE INCOME, WHICH HAVE ESCAPED ASSESSMENT AND MERE LY RELIED ON THE INFORMATION RECEIVED FROM AIR, WHICH IS VAGUE, INCO RRECT AND BASELESS, HENCE, THE PROCEEDINGS INITIATED IS ILLEGAL, BAD IN LAW AND WITHOUT JURISDICTION. HE FURTHER SUBMITTED THAT LD. CIT (A) HAS ERRED IN UPH OLDING THE VALIDITY OF THE PROCEEDINGS INITIATED U/S 147 OF THE ACT READ WITH SECTION 148 OF THE ACT. THE ADDITION/ DISALLOWANCES MADE BY THE ASSESSING OFFICER A RE ILLEGAL, UNJUST, HIGHLY EXCESSIVE AND ARE NOT BASED ON ANY MATERIAL ON R ECORD BY THE ASSESSING OFFICER. THE TOTAL INCOME OF THE ASSESSEE HAS BEEN W RONGLY AND ILLEGALLY COMPUTED BY THE ASSESSING OFFICER AT RS.19,51,50 0.00 AS AGAINST DECLARED INCOME OF RS.1,66,270.00. IT WAS FURTHER SUBMI TTED THAT LD. CIT (A) HAS ERRED IN CONFIRMING THE ADDITION TO RS.17,26,5 00.00, WHICH IS HIGHLY ARBITRARY AND UNJUSTIFIED. HE FURTHER SUBMITTED THAT THE AO HAS FAILED TO APPRECIATE, THAT, THE SOURCE OF CASH DEPOSIT HAS BEEN EXP LAINED, THAT, THE AMOUNT HAS BEEN WITHDRAWAL FROM TIME TO TIME FROM SA ME BANK ACCOUNTS AND AGRICULTURE INCOME, WHICH IS UNDER DISPUTE, HENCE, T HE ADDITION MADE BY 5 THE ASSESSING OFFICER AND UPHELD BY THE CIT (A) IS PUREL Y BASED ON PRESUMPTION AND SURMISES AND CONJECTURE WITHOUT APPRECI ATING THE FACTS OF THE CASE. THE ASSESSING OFFICER/CIT(A), IN VIEW OF THE FACT S AND CIRCUMSTANCES OF THE CASE ERRED ON FACTS AND IN LAW IN MAKIN G THE AD-HOC ADDITION DISALLOWANCE ON ESTIMATED BASIS, WHICH IS UNJUST, ARBITRARY, UNLAWFUL, HIGHLY EXCESSIVE, BASED ON SURMISES AND CONJECTUR ES AND CANNOT BE JUSTIFIED BY ANY MATERIAL ON RECORD. THE ADDITIONS CONFIRMED AND THE OBSERVATIONS MADE BY CIT (A) ARE UNJUST, UNLAWFUL AND BASED ON MERE SURMISES AND CONJUNCTURES. THE ADDITIONS MADE CANNOT BE JUST IFIED BY ANY MATERIAL ON RECORD. THAT THE EXPLANATION GIVEN EVIDE NCE PRODUCED, MATERIAL PLACED AND AVAILABLE ON RECORD HAS NOT BEEN PROPERLY CO NSIDERED AND JUDICIALLY INTERPRETED AND THE SAME DO NOT JUSTIFY THE ADDITIONS/ ALLOWANCES MADE. IT WAS FURTHER SUBMITTED THAT THE IMPUGNED ASSESSME NT ORDER PASSED BY THE ASSESSING OFFICER AND ORDER PASSED BY LD. CIT(A) ARE AGAINST THE PRINCIPLES OF NATURAL JUSTICE AND THE SAME HAS BEEN PASSED WITHOUT AFFORDING REASONABLE AND ADEQUATE OPPORTUNITY OF BEING HEARD. 6. ON THE CONTRARY, LD. DR RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW AND REITERATED ON THE FINDINGS OF THE AUTHORITIES BE LOW. 7. I HAVE HEARD BOTH THE PARTIES AND PERUSED THE RECOR DS, ESPECIALLY THE ORDERS OF THE REVENUE AUTHORITIES. I FIND CONSIDERABLE COGENCY IN THE CONTENTION OF THE ASSESSEES COUNSEL THAT THE ORDERS PASSED B Y THE ASSESSING OFFICER AND THE LD. CIT(A) ARE AGAINST THE PRI NCIPLES OF NATURAL 6 JUSTICE AND THE SAME HAS BEEN PASSED WITHOUT AFFORDING R EASONABLE AND ADEQUATE OPPORTUNITY OF BEING HEARD. IN VIEW OF ABO VE, I AM OF THE CONSIDERED VIEW THAT THE MATTER NEEDS FRESH ADJUDICATION AT THE LEVEL OF THE LD. CIT(A), HENCE, I SET ASIDE THE ISSUES TO THE FILE OF THE LD. CIT(A), WITH THE DIRECTIONS TO DECIDE THE SAME AFRESH AFTER GIVING A DEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 17-12-2019. SD/- (H.S. SIDHU) JUDICIAL MEMBER DATED: 17-12-2019 *SRB* COPY OF ORDER FORWARDED TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR