Krishna Charan Bhattacharya, Kolkata V. CCIT-III, KOLKATA, Kolkata

ITA 433/KOL/2015

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 2194 (ITAT-KOLKATA)
• Duration Of Justice: 4 year(s) 2 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-06-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: misc
• Appeal Filed On: 16-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANKAR HALDER J CI
• Assessee Lawyers: A B MAITRA A VOCATE
• Keywords: Document seized; Documents seized; Set aside
• Section: 143(3); 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH : KOLKATA [BEFORE HONBLE SHRI S.S. GODARA, JM ] I.T . A NO S . 430 - 431 /KOL/2015 A.Y S 1986 - 87 & 1987 - 88 SA T INATH BHATTACHARYA V/S. CHIEF COMMISSIONER OF INCOME - TAX, PAN: A EAPB1514 Q III, KOLKATA (APPELLANT) (RESPONDENT) I.T. A NO. 432/KOL/2015 A.Y 1986 - 87 BHABANI CHARAN BHATTACHARYA V/S. CHIEF COMMISSIONER OF INCOME - TAX, PAN: AHPPB77633Q III, KOLKATA (APPELLANT) (RESPONDENT) I.T. A NOS. 433 - 434/KOL/2015 A.YS 1986 - 87 & 1987 - 88 KRISHNA CHARAN BHATTACHARYA V/S. CHIEF COMMISSIONER OF INCOME - TAX, PAN: AEAPB1513Q III, KOLKATA (APPELLANT) (RESPONDENT) I.T. A NOS. 435 - 436/KOL/2015 A.YS 1986 - 87 & 1987 - 88 RAGHUNATH BHATTACHARYA V/S. CHIEF COMMISSIONER OF INCOME - TAX, PAN: AEAPB1453N III, KOLKATA (APPELLANT) (RESPONDENT) I.T. A NOS. 437 - 438/KOL/2015 A.YS 1986 - 87 & 1987 - 88 TARA CHARAN BHATTACHARYA V/S. CHIEF COMMISSIONER OF INCOME - TAX, PAN: A HPPB7634K III, KOLKATA (APPELLANT) (RESPONDENT) I.T. A NO. 439/KOL/2015 A.Y 1986 - 87 NARENDRANATH BHATTACHARYA V/S. CHIEF COMMISSIONER OF INCOME - TAX, PAN: AEAPB1454M III, KOLKATA (APPELLANT) (RESPONDENT) FOR THE APPELLANT /ASSESSEE : SHRI A.B. MAITRA, A VOCATE, AR FOR THE RESPONDENT /DEPARTMENT : SHRI SANKAR HALDER, . J CIT, DR 2 ITA NO S 430 TO 439/KOL/2015 - SMC - JM 2 ITA NO S 430 TO 439/KOL/2015 - SMC - JM DATE OF HEARING : 2 5 - 06 - 2019 DATE OF PRONOUNCEMENT: 26 - 06 - 2019 ORDER SHRI S.S. GODARA, JM : 1. TH ESE SIX A SSESSEES HAVE FILED THEIR RESPECTIVE INSTANT APPEALS FOR ASSESSMENT YEAR S 1986 - 87 TO 1987 - 88 ARISE AGAINST THE CIT(A) , 7, KOLKATAS SEPARATE ORDER S; DATED 17 - 02 - 2015 AND 18 - 02 - 2015 PASSED IN CASE NO S . 8/CIT(A) - 7/W - 26(3)/SET ASIDE/14 - 15, 669/CIT(A) - 7/W - 26(3)/SET ASIDE/14 - 15, 6/ CIT(A) - 7/W - 26(3)/SET ASIDE/14 - 15, 7/CIT(A) - 7/W - 26(3)/SET ASIDE/14 - 15 , 668/CIT(A) - 7/W - 26(3)/SET ASIDE/14 - 15, 9/CIT(A) - 7/W - 26(3)/SET ASIDE/14 - 15, 666/CIT(A) - 7/W - 26(3)/SET ASIDE/14 - 15, 4/CIT(A) - 7/W - 26(3)/SET ASIDE/14 - 15, 667/CIT(A) - 7/W - 26(3)/SET ASIDE / 14 - 15 AND 5/CIT(A) - 7/W - 26(3)/SET ASIDE/14 - 15 ; RESPECTIVELY , INVOLVING PROCEEDINGS U/S 143(3) /147 OF THE I.T ACT , 1961 (IN SHORT ACT) . HEARD BOTH THE PARTIES. CASE FILE S PERUSED. 2. IT TRANSPIRES DURING THE COURSE OF THE HEARING THAT BOTH THE LOWER AUTHORITIES HAVE MADE IDENTICAL ADDITION(S) IN EACH CASE INVOLVING VARIOUS SUMS OF SUNDRY DEBTORS IN THE HANDS OF RESPECTIVE ASSESSEE S . THE CIT(A)S DETAILED DISCUSSION TO THIS EFFECT READS AS UNDER: - IN PU RSUANCE OF THE ORDER OF THE HON 'BLE CALCUTTA HIGH COURT THIS OFFICE STARTED THE APPELLATE PROCEEDINGS IN THE CASE OF APPELLANT. ON GOING THROUGH THE RECORD IT IS FOUND THAT THERE IS NO APPEAL FOLDER OF THE APPELLANT. THEREFORE, LETTER WAS WRITTEN TO TH E A.D. AND APPELLANT ALSO REQUESTED TO FILE THE COPY OF THE ASSESSMENT ORDER, COPY OF CIT (A) ORDER, COPY OF GROUNDS OF APPEAL ETC. THE A.O. FAILED TO FILE FULL DOCUMENTS TO THIS OFFICE. I ALSO WROTE A LETTER TO CIT - 9, KOLKATA TO DIRECT THE 3 ITA NO S 430 TO 439/KOL/2015 - SMC - JM 3 ITA NO S 430 TO 439/KOL/2015 - SMC - JM A.O. TO MAKE TH E ARRANGEMENT OF ABOVE DOCUMENTS. AFTER THAT THE AO. ALSO FAILED TO SUBMIT FULL DOCUMENTS AS MENTIONED ABOVE. THE A/R OF THE APPELLANT FILE THE COPY OF ASSESSMENT ORDER, GROUNDS OF APPEAL ALON G WITH AFFIDAVIT OF THE APPELLANT AND SUBMISSION ON 16.02.2015 . THEREFORE, I HAVE NO ALTERNATE TO DECIDE THE APPEAL ON THE BASIS OF MATERIAL BEFORE ME. ACCORDINGLY, I DEALT THE GROUNDS WHICH WAS FILED BEFORE ME ON 16.02. 2015 WHICH ARE AS UNDER: - GROUNDS OF APPEAL: I. FOR THAT THE ASSESSING OFFICER HAS TAKEN THE OPENING BALANCE OF THE ASSESSMENT YEAR 1987 - 88 WHERE THE ASSESSEE HAS NOT SUBMITTED ANY STATEMENT, THEREFORE, THE ADDITION OF DIFFERENCE OF SUNDRY DEBTORS AND THUS MAKING A HIGHER ASSESSMENT BASED ON PRESUMPTION IS WHIMSICAL, BASELESS AND ARBITRARY, THEREF ORE, THE ASSESSMENT IS LIABLE TO BE SET ASIDE. II. FOR THAT THE ASSESSING OFFICER FAILS TO UNDERSTAND THAT INCLUSION OF THE TAX PAID AMOUNT IS NOTHING BUT INVOLVES DOUBLE TAXATION, THEREFORE THE ASSESSMENT IS LIABLE TO BE SET ASIDE. III. FOR THAT REOPENI NG OF THE ASSESSMENT UNDER SECTION 147 OF THE INCOME TAX ACT, 1 961 IS COMPLETELY BASED ON SURMISES AND CONJECTURES HAVE NO LEGAL SANCTITY THEREFORE, THE ORDER PASSED BY THE ASSESSING OFFICER IS LIABLE TO BE SET ASIDE. IV. FOR THAT THE ADDITIONS MADE FOR RS.3,71,652/ - FOR DIFFERENCE IN SUNDRY DEBTORS OVER THE RETURNED INCOME BY THE ASSESSING OFFICER IGNORING THE REPRESENTATION OF THE ASSESSEE IN THE ASSESSMENT YEAR 1986 - 87 IS IRRELEVANT, ILLEGAL AND WHIMSICAL WITHOUT HAVING ANY AUTHORITY UNDER THE ACT AND BASELESS. V. FOR THAT THE DISCLOSURE OF INVESTMENT RELATING TO THE ASSESSMENT YEAR 1988 - 89 AND ALREADY RECORDED IN THE BOOKS OF ACCOUNT AND DISCLOSED IN THE ASSESSMENT YEAR 1988 - 89 THEREFORE, THE AMOUNT RECORDED AS DISCLOSED AMOUNT CANNOT BE REGARDED AS U NDISCLOSED INVESTMENT. VI. FOR THAT THE TAX DUE ON THE BASIS OF DISCLOSURE MADE BY THE ASSESSEE IS PAID BY THE ASSESSEE WITHOUT LEAVING ANY AMOUNT DUE. THEREFORE, THE AMOUNT CARRIED BACKWARD AND INCLUSION OF THE SAME IN THE INCOME OF THE ASSESSMENT YEAR 1986 - 87 IS NOTHING BUT DOUBLE TAXATION OF THE AMOUNT. VII. FOR THAT THE AMOUNT OF TAX AND PENALTY IN THE ASSESSMENT ORDER IS BASELESS AND HAS NO VALUE IN THE EYE OF LAW AND LIABLE TO BE SET ASIDE. 4 ITA NO S 430 TO 439/KOL/2015 - SMC - JM 4 ITA NO S 430 TO 439/KOL/2015 - SMC - JM VIII. FOR THAT OTHER POINTS M.AG BE RAISED ON OR BEFORE T HE HEARING OF THE APPEAL DURING THE APPELLANT PROCEEDINGS, SHRI AMIYA KUMAR SAHU, A/R. OF THE APPELLANT ATTENDED AND DISCUSSED THE CASE. GROUND NO III : THIS GROUND IS LEGAL GROUND BUT APPELLANT NOT FILED ANY SUBMISSION ABOUT THIS GROUND. THEREFORE, THIS GROUND IS NOT ALLOWED. GROUND NOS.I, II & IV TO VII: THESE GROUNDS ARE RELATED TO THE ADDITION MADE BY THE ASSESSING OFFICER OF RS. 3,71,6521 - . THIS ISSUE DEALT BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER AS UNDER: - THE ASSESSEE HAD PREFERRED A PETITION U/S. 264 FOR A.Y. 88 - 89 WHEREIN IT WAS CLAIMED THAT DISCLOSURE CAN BE RETRACTED ON THE BASIS OF UNDISPUTABLE EVIDENCE AND IT WAS PLEADED THAT DISCLOSURE AMOUNT FOR A.Y. 88 - 89 SHOULD BE REDUCED BY AN AMOUNT O/ RS. 2,24, 017/ - ASSESSED AS ADDITIONAL INCOME ON ACCOUNT OF MONEY LENDING FOR A.Y. 87 - 88. THE LD. COMMISSIONER IN HIS ORDER U/S. 264 ALLOWED THE SAME AFTER CONSIDERING THE STATEMENT OF ACCOUNTS FURNISHED BY THE ASSESSEE. IN THE CIRCUMSTANCES THE ASSESSEE ENJOYED BEN EFIT OF OPENING BALANCE OF S/DRS. FOR A.Y. 87 - 88 OF RS.4,96,361/ - AND ON THE BASIS OF THE SAID OPENING BALANCE THE SUBSEQUENT STATEMENT HAVE ALSO BEEN PREPARED. THEREFORE THE ASSESSEE CANNOT ONCE AGAIN RETRACT AND CLAIM THAT THE AMOUNT INTENDED TO BE ASSES SED IN THIS GEAR I.E. A.Y. 86 - 87 HAS ALREADY BEEN INCLUDED WITHIN THE DISCLOSURE AMOUNT. THEREFORE THE ASSESSEE WAS SHOW CAUSE WHY THE AMOUNT OF RS.3,71,652/ - SHOULD BE TREATED AS UNDISCLOSED INCOME FOR A.Y. 86 - 87. IN RESPONSE THE A/ R. SRI K.R. MONDAL AP PEARED BEFORE THE UNDERSIGNED ON 27.1.95. NO WRITTEN REPLY TO THE SHOW CAUSE WAS FILED. THE A/ R WAS ALSO UNABLE TO EXPLAIN THE DIFFERENCE S/ DRS. AS DISCUSSED ABOVE. IN VIEW OF THE FACT THAT NO SATISFACTORY EXPLANATION COULD BE FORWARDED AND THE DIFFERENC E IN S/DRS. OF RS.3,71,652/ - BETWEEN THE CLOSING BALANCE OF A.Y. 86 - 87 AND OPENING BALANCE FOR A.Y. 87 - 88 IS TREATED AS UNDISCLOSED INCOME FOR A.Y. 1986 - 87. THE RETURN WAS FILED ON 16.07.1986 SHOWING INCOME RS. 26,000/ - AND THE ASSESSMENT WAS COMPLETED ON 29 TH JUNE, 1987. SUBSEQUENTLY, A SEARCH WAS CONDUCTED ON THE PREMISES OF THE ASSESSEE ON 22 ND AND 23 RD FEBRUARY, 1988 RESULTING IN SEIZURE OF BOOKS OF ACCOUNTS AND JEWELLERY ITEMS THE SAID BOOKS OF ACCOUNTS ARE STILL LYING WITH THE DEPARTMENT BUT RETURNED THE SEIZED JEWELLERY ITEMS. IN COURSE OF SEARCH THE SEARCH PARTY RECORDED A DISCLOSURE OF [RS.50,000/ - 5 ITA NO S 430 TO 439/KOL/2015 - SMC - JM 5 ITA NO S 430 TO 439/KOL/2015 - SMC - JM UNDER SECTION 132(4) OF THE INCOME TAX ACT, 1961. AFTER THE SEARCH THE ASSESSMENT FOR THE ASSESSMENT YEAR 1987 - 88 WAS TAKEN UP AND COMPLETED UNDER SECTIO N 143(3). THE ASSESSEE DID NOT SUBMIT ANY STATEMENT OF SUNDRY DEBTORS, THEREFORE, THERE IS NO QUESTION OF OPENING BALANCE OF SUNDRY DEBTORS AT RS 4,96,361/ - THEREFORE, THE PROCEEDINGS UNDER SECTION 147 IS TOTALLY BASED ON SURMISES AND CONJECTURES. THEREFOR E, THE ADDITION OF RS. 3,31,652/ - AND REOPENING OF THE ASSESSM.ENT FOR THE ASSESSMENT YEAR 1986 - 87 IS NOTHING BUT TO UNDUE HARASSMENT TO THE ASSESSEE. THE LD. A.O. OR THE SEARCH PARTY DID NOT GET ANY INCREMENTING RECORD FROM THE SEIZED DOCUMENTS. ACCORDING TO THE NATURE OF BUSINESS THE ASSESSEE IS REQUIRED TO MAINTAIN CLEAR ACCOUNTS IN RESPECT OF NS CLIENTS, SO THERE IS NO QUESTION OF CONCEALED ACCOUNT AND THAT IS WHY THE SEARCH PARTY COULDNT IDENTIFY ANY CONCEALED ACCOUNTS AT THE TIME OF SEARCH. NO INCREM ENTAL DOCUMENTS ARE RECEIVED BY THE SEARCH PARTY. AS THE SEARCH WAS CON - DUCTED PRIOR TO THE FILING OF THE RETURN FOR THE ASSESSM.ENT YEAR EVERYTHING HAS BEEN DISCLOSED IN THE ASSESSMENT GEAR 1988 - 89 SO NOTHING CAN BE REGARDED AS UNDISCLOSED FOR THE ASSESSM ENT YEAR 1988 - 89. THEREFORE THE PROCEEDING UNDER SECTION 147 FOR THE ASSESSMENT YEAR 1986 - 87 IS WHIMSICAL, BASELESS AND UNETHICAL. THE BOOKS OF ACCOUNTS ARE STILL LYING WITH THE DEPARTMENT WHICH IS KEPT UNLAWFULLY BY THE DEPARTMENT AND FOR WHICH THE ASSESS EE HAS TO SUFFER A HIGH LOSS. IN VIEW OF THE ABOVE MG RESPECTFUL SUBMISSION BEFORE YOUR HONOUR THAT THE ADDITION OF RS.3,31,652/ - MAY BE DELETED ALL THE PROCEEDINGS RELATING TO THE ASSESSMENT MAY BE DROPPED.' I HAVE CAREFULLY CONSIDERED THE OBSERVATION M ADE BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER AND SUBMISSION FILED BY THE AUTHORIZED REPRESENTATIVE OF THE APPELLANT. I FOUND THAT SEARCH WAS CONDUCTED ON 22.02.1988 AND 23.02.1988 AT THE PREMISES OF THE APPELLANT. DURING THE COURSE OF SEARCH PROCEE DINGS, BOOKS OF ACCOUNTS AND OTHER INCRIMINATING DOCUMENTS WERE SEIZED. THE ASSESSING OFFICER MADE THE ADDITION ON THE BASIS OF INCRIMINATING DOCUMENTS OF RS. 3,71,652/ - AS DIFFERENCE IN SUNDRY DEBTORS. THE ASSESSING OFFICER DISCUSSED THIS ISSUE IN DETAIL IN THE ASSESSMENT ORDER. THE AUTHORIZED REPRESENTATIVE OF THE APPELLANT NOT FILED ANY EXPLANATION REGARDING THE DIFFERENCE IN THE 3,71,652/ - DURING THE COURSE OF ASSESSMENT PROCEEDINGS AS WELL AS APPELLATE PROCEEDINGS. THEREFORE THERE IS NO JUSTIFICATION T O INTERFERE THE ADDITION MADE BY THE ASSESSING OFFICER OF RS.3,71,652/ - AS DIFFERENCE IN SUNDRY DEBTORS. HENCE, I CONFIRM THE ADDITION MADE BY THE ASSESSING OFFICER OF RS.3,71,652/ - AS DIFFERENCE IN SUNDRY DEBTORS. THESE GROUNDS ARE NOT ALLOWED. 6 ITA NO S 430 TO 439/KOL/2015 - SMC - JM 6 ITA NO S 430 TO 439/KOL/2015 - SMC - JM 3. IT IS SUFFICIENTLY CLEAR FROM A PERUSAL OF CIT(A)S ABOVE EXTRACTED FINDINGS THAT HE HAS PROCEEDED TO AFFIRM THE ASSESSING OFFICERS ACTION MAKING THE IMPUGNED ADDITION(S) DESPITE THE FACT THAT THE LATTER HAD NOT FILED ANY MATERIAL /CASE RECORDS AGAINST THESE TAXPAYERS IN SUPPORT OF THE IMPUGNED ADDITION(S) . SUFFICE TO SAY I AM OF THE VIEW THAT THE CIT(A) HAS ERRED IN CONFIRMING THE IMPUGNED ADDITION(S) WITHOUT ANY SUPPORTING MATERIAL ON RECORD INDICATING SUCH SUNDRY DEBTORS. I THEREFORE REJECT R EVENUES VEHEMENT ARGUMENTS IN THIS BACKDROP OF FACTS AND CONCLUDE THAT THE CIT(A) HAS ERRED IN UPHOLDING THE ASSESSING OFFICERS ACTION MAKING THE IMPUGNED ADDITION(S) IN ABSENCE OF ANY EVIDENCE AT ALL . THE IMPUGNED ADDITIONS ARE DELETED ACCORDINGLY. 4. TH ESE ASSESSEES APPEALS ARE ALLOWED IN ABOVE TERMS . ORDER PRONOUNCED IN THE COURT ON 26 - 06 - 2019 SD/ - [ S.S.GODARA ] JUDICIAL MEMBER DATED : 26 - 0 6 - 2019 7 ITA NO S 430 TO 439/KOL/2015 - SMC - JM 7 ITA NO S 430 TO 439/KOL/2015 - SMC - JM **PRADIP, SR. PS C OPY OF THE ORDER FORWARDED TO: COPY OF THE ORDER FORWARDED TO: 1. APP ELLANT / ASSESSEE: SRI SATINATH BHATTACHARYA, SOUTH BISHNUPUR, SOUTH 24 PGS(W.B) 743395 /SRI BHABANI CHARAN BHATTACHARYA, SOUTH BISHNUPUR, SOUTH 24 PGS(W.B) 743395/ SRI KRISHNA CHARAN BHATTACHARYA, SOUTH BISHNUPUR, SOUTH 24 PGS(W.B) 743395/ SRI RAGHUNATH BHATTACHARYA, SOUTH BISHNUPUR, SOUTH 24 PGS(W.B) 743395/ SRI TARACHARAN BHATTACHARYA, SOUTH BISHNUPUR, SOUTH 24 PGS(W.B) 743395 A ND SRI NARENDRANATH BHATTACHARYA, SOUTH BISHNUPUR, SOUTH 24 PGS(W.B) 743395. 2 RESPONDENT/ REVENUE: THE C.C. I.T - III, P - 7, CHOWRINGHEE SQUARE, KOLKATA - 700 069. 3. CIT, 4. CIT(A), KOLKATA 5. DR, KOLKATA BENCHES, KOLKATA **PP/SPS TRUE COPY BY BY ORDER ASSISTANT REGISTRAR ITAT KOLKATA