Santilata Sahoo, Cuttack V. DCIT, Cuttack

ITA 432/CTK/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 58400 (ITAT-CUTTACK)
• Duration Of Justice: 4 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-02-2012
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Next Hearing Date: 18-01-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 17-10-2011
• Court: TRIBUNAL
• Department Lawyers: S C MOHANTY
• Assessee Lawyers: B PANDA
• Keywords: Unexplained cash credit; Opportunity of being heard; Principle of natural justice

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK BEFORE : SHRI K.K.GUPTA, AM, AND SHRI K.S.S.PRASAD RAO, JM ITA NO. 432/CTK/2011 (ASSESSMENT YEAR 2007 - 08) SMT.SANTILATA SAHO, PROP.M/S.S.B.S.INDUSTRIES, CHAULIAGANJ, CUTTACK 753 004 PAN: ACT PS 8378 L VERSUS DCIT, CIRCLE 1(1), CUTTACK. (APPELLANT) (RESPONDENT) FOR THE APPELLANT: SHRI B.PANDA, AR FOR THE RESPONDENT SHRI S.C.MOHANTY, DR DATE OF HEARING : 18.01.2012 DATE OF PRONOUNCEMENT : 17.02.2012 ORDER SHRI K.S.S.PRASAD RAO, JM : THIS APPEAL IS FILED BY THE ASSESSEE HAVING BEEN AGGRIEVED BY THE ORDER DT.25.7.2011 OF THE COMMISSIONER OF INCOME - TAX (APPEALS) FOR THE ASSESSMENT YEAR 2007 - 08 IN THE CASE OF THE ASSESSEE. 2. THE ASSESSEE HAS RAISED THE SOLITARY ISSUE CHALLENGING THE ADDITION MADE OF 13 LAKHS U/S.68 OF THE I.T.ACT,196, CLAIMED BY THE ASSESSEE TAKEN AS LOAN FROM ONE BINOD CHANDRA SAHOO, KARTA OF H.U.F. 3. BOTH THE PARTIES WERE HEARD REGARDING THE ISSUE AND ITS LEGAL IMPLICATION. 4. ON CAREFUL CONSIDERATION OF THE MATE RIAL MADE AVAILABLE TO THE TRIBUNAL IN THE LIGHT OF RIVAL SUBMISSIONS OF BOTH THE PARTIES, THE RELEVANT FACTS ARE THAT THE ASSESSEE IS DOING BUSINESS OF FABRICATION OF GRILLS IN THE NAME & STYLE OF M/S.S.B.S. INDUSTRIES . DURING THE COURSE OF ASSESSMENT, TH E ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAD OBTAINED UNSECURED LOAN OF 13,00,000. ON VERIFICATION OF EVIDENCE PRODUCED IN SUPPORT OF THE CLAIM, THE ASSESSING OFFICER FOUND THAT THE LOANS HAD BEEN OBTAINED IN CASH FROM BINOD CHANDRA SAHOO (HUF) AND THE SOURCE OF THE CREDITOR WAS CLAIMED TO BE FROM HOUSE PROPERTY INCOME AND AGRICULTURE. THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE FAILED TO PRODUCE THE RETURNS OF INCOME FOR THE ASSESSMENT YEAR ITA NO.432/CTK/2011 2 UNDER CONSIDERATION BUT FILED THE RETURNS OF INCOME FO R ASSESSMENT YEAR 2008 - 09 WHICH REFLECTED A HOUSE PROPERTY INCOME OF 2,84,000. HOWEVER, THERE WAS NO MENTION OF ANY AGRICULTURAL INCOME. THERE WAS NO ENTRY IN THE COLUMNS FOR ASSETS AND LIABILITY TO SUGGEST THAT THE LOAN WAS OUTSTANDING OR AVAILABILITY OF FUNDS. THEREFORE, THE ASSESSING OFFICER HELD THAT THE CREDITWORTHINESS OF THE CREDITOR IS NOT ON CORRECT FOOTING. THUS, THE ASSESSEE HAS FAILED TO DISCHARGE HER ONUS OF PROVING THE CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTION. HE, THEREFORE, MADE T HE ADDITION OF 13,00,000 TO THE TOTAL INCOME OF THE ASSESSEE AS UNEXPLAINED CASH CREDIT U/S.68. AGGRIEVED, THE ASSESSEE PREFERRED APPEAL BEFORE THE LEARNED CIT(A) AND BEING UNSUCCESSFUL HAS COME UP IN THE PRESENT APPEAL BEFORE THE TRIBUNAL. 5. HAVING HEARD BOTH THE PARTIES AND PERUSING THE MATERIAL AVAILABLE ON RECORD . THE LEARNED AR OF THE ASSESSEE HAS FURNISHED ALL THE DETAILS IN THE PAPER BOOK AS TO THE AVAILABILITY OF FUNDS WITH THE CASH CREDITOR SHOWING THAT BESIDES RENT RECEIVED OF 95,000 THE CASH CREDITOR SH RI BINOD SAHOO HAS SHOWN INCOME OF 13,71,481.25 FROM SALE OF AGRICULTURAL LAND (PATERNAL PROPERTY) OF ABOUT A0.2545 DEC., IN SUPPORT OF WHICH THE ASSESSEE HAS ALSO FURNISHED THE COPIES OF SALE DEED ETC., FROM WHICH IT IS NOTICED THAT THE CASH CREDITOR HA D SUFFICIENT FUNDS TO GIVE LOAN OF 13,00,000 TO THE ASSESSEE. WE FIND THAT THE AUTHORITIES BELOW HAVE NOT EXAMINED THESE DOCUMENTS AND THEREFORE, WE SET ASIDE THE IMPUGNED ORDERS OF THE DEPARTMENTAL AUTHORITIES AND RESTORE THE ISSUE TO THE FILE OF THE AS SESSING OFFICER FOR DE NOVO CONSIDERATION IN THE LIGHT OF THE EVIDENCES PRODUCED IN THE PAPER BOOK AND THEREAFTER PASS NECESSARY CONSEQUENTIAL ORDER OF COURSE STRICTLY FOLLOWING THE PRINCIPLES OF NATURAL JUSTICE BY GIVING PROPER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. ITA NO.432/CTK/2011 3 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. S D/ - SD/ - (K.K.GUPTA) ACCOUNTANT MEMBER (K.S.S.PRASAD RAO) JUDICIAL MEMBER DATE: 17.02.2012 H.K.PADHEE, SENIOR PRIVATE SECRETARY. COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT: SMT.SANTILATA SAHO, PROP.M/S.S.B.S.INDUSTRIES, CHAULIAGANJ, CUTTACK 753 004 2. THE RESPONDENT: DCIT, CIRCLE 1(1), CUTTACK. 3. THE CIT, 4. THE CIT(A), 5. THE DR, C UTTACK 6. GUARD FILE (IN DUPLICATE) TRUE COPY, BY ORDER, SENIOR PRIVATE SECRETARY.