Mr. Vinod Kumar Garg, Mathura V. A.C.I.T., Central Circle, Agra

ITA 435/AGR/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 7068 (ITAT-AGRA)
• Duration Of Justice: 5 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-04-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 25-04-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 23-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K SHARMA
• Assessee Lawyers: P K SEHGAL
• Keywords: Principle of natural justice
• Section: 143(3); 142(1); 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA (SMC) BENCH, AGRA BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER ITA NO. 435/AGR./2010 ASSTT. YEAR : 2005-06 SHRI VINOD KUMAR GARG, VS. ASSTT. COMMISSIONER OF INCOME TAX, MUKUND HOUSE (SHIV SADAN), CENTRAL CIRCLE, AGRA. DAMPIER NAGAR, MATHURA. (PAN: ABEPG 8180 C) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI P.K. SEHGAL, ADVOCATE RESPONDENT BY : SHRI A.K. SHARMA, JR. D.R. ORDER THE ASSESSEE HAS FILED THE PRESENT APPEAL AGAINST THE ORDER DATED 28.09.2010 PASSED BY THE LD. CIT(A)-II, AGRA. 2. THE BRIEF FACTS RELATING TO THE ISSUE IN DISPUTE ARE THAT THE ASSESSEE HAS FILED HIS RETURN OF INCOME ON 31.03.2006 DECLARING INCOME OF ` 2,88,478/-. THE ASSESSING OFFICER ISSUED NOTICE UNDER SECTION 143(2 ) AND 142(1) OF THE INCOME TAX ACT, 1961 (THE ACT HEREINAFTER). IN RESPONSE TO THE SAME, THE LD. AUTHORISED REPRESENTATIVE (A.R.) OF THE ASSESSEE APPEARED AND FILED WRITTEN REPLY AND DOCUMENTARY EVIDENCES AS REQUIRED BY THE ASSESSING OFFICER. AFTER PERUSING THE SAME, THE ASSESSING OFFICER WAS OF THE OPINION THAT THE ASSESSEE HAS BEEN PAYING 2 INTEREST ON LOANS TAKEN FROM THE FAMILY MEMBERS AND OTHERS. HE WAS ALSO OF THE OPINION THAT INTEREST OF ` 55,425/- HAS BEEN PAID TO SMT. ANGOORI DEVI AND ` 88,768/- PAID TO SHRI BALMUKUND GARG, HUF. SINCE T HE INTEREST BEARING LOANS HAVE BEEN UTILISED FOR ACQUIRING PERSONAL ASSETS AN D WHICH ARE NON INCOME GENERATING ASSETS, THE INTEREST EXPENSES ARE NOT AL LOWABLE AS PER THE PROVISIONS OF SECTION 14A OF THE ACT AND ACCORDINGLY THE INTEREST AS CLAIMED AMOUNTING TO ` 1,44,193/- IS NOT ALLOWABLE AND THE SAME IS ADDED T O THE INCOME OF THE ASSESSEE. HE COMPLETED THE ASSESSMENT ON 26.12.2007 UNDER SEC TION 143(3) OF THE ACT. AGGRIEVED BY THE SAME, THE ASSESSEE FILED APPEAL BE FORE THE LD. FIRST APPELLATE AUTHORITY WHO, VIDE THE IMPUGNED ORDER DATED 28.09. 2010, DISMISSED THE APPEAL OF THE ASSESSEE. NOW, THE ASSESSEE HAS FILED THE PRES ENT APPEAL AGAINST THE IMPUGNED ORDER DATED 28.09.2010. 3. AT THE TIME OF HEARING, SHRI P.K. SEHGAL, ADVOCA TE, LD. COUNSEL FOR THE ASSESSEE STATED THAT THE REVENUE AUTHORITIES BELOW HAS MADE THE ADDITION IN DISPUTE CONTRARY TO THE LAW AND FACTS ON FILE, ESPE CIALLY IGNORING THE PAST HISTORY OF THE ASSESSEE BECAUSE IN THE PAST ASSESSMENT YEARS S IMILAR RELIEF HAD BEEN ALLOWED TO THE ASSESSEE, BUT IN THE ASSESSMENT YEAR IN DISP UTE THE SAME HAS BEEN DENIED BY THE ASSESSING OFFICER AND WRONGLY CONFIRMED BY THE LD. FIRST APPELLATE AUTHORITY. HE FURTHER STATED THAT THE ASSESSEE HAS ALSO TAKEN LOANS FROM SMT. ANGOORI DEVI 3 AND SHRI BALMUKUND GARG IN THE PREVIOUS YEAR ALSO A ND CLAIMED THE DEDUCTION OF INTEREST PAID TO THEM AND THE SAME HAS BEEN ALLOWED BY THE REVENUE AUTHORITIES IN THE PREVIOUS YEARS BY COMPLETING THE ASSESSMENT UND ER SECTION 143(3) OF THE ACT. IN SUPPORT OF THE SAME, HE HAS FILED A PAPER BOOK C ONTAINING PAGE NOS.1 TO 21 IN WHICH HE HAS FILED A CHART SHOWING PAST HISTORY OF THE ASSESSEE, ALONG WITH COPY OF ACCOUNTS OF SMT, ANGOORI DEVI AND SHRI BALMUKUND GA RG FOR THE FINANCIAL YEARS 2001-02 TO 2004-05 ALONG WITH COPY OF ASSESSMENT OR DERS PASSED UNDER SECTION 143(3) OF THE ACT IN THE ASSESSEES OWN CASE. HE R EQUESTED THAT THE ADDITION IN DISPUTE HAS WRONGLY BEEN MADE BY THE REVENUE AUTHOR ITIES WHICH IS CONTRARY TO THE PAST HISTORY OF THE ASSESSEES OWN CASE AND REQ UESTED THAT THE ADDITIONS IN DISPUTE MAY BE DELETED BY ALLOWING THE APPEAL OF TH E ASSESSEE. 4. ON THE CONTRARY, THE LD. D.R. RELIED UPON THE OR DER PASSED BY THE REVENUE AUTHORITIES. HE HAS NOT CONTROVERTED THE ARGUMENTS ADVANCED BY THE LD. COUNSEL FOR THE ASSESSEE. 5. I HAVE HEARD BOTH THE PARTIES AND PERUSED THE RE LEVANT RECORDS AVAILABLE WITH ME ESPECIALLY THE PREVIOUS ASSESSMENT ORDERS PASSED BY THE ASSESSING OFFICER UNDER SECTION 143(3) OF THE ACT IN THE ASSESSEES O WN CASE ALONG WITH COPY OF ACCOUNTS OF SMT. ANGOOI DEVI AND SHRI BALMUKUND GAR G, HUF FOR THE FINANCIAL 4 YEARS 2001-02 TO 2004-05. I AM OF THE CONSIDERED O PINION THAT THE REVENUE AUTHORITIES HAS WRONGLY DISALLOWED THE CLAIM IN DIS PUTE BY IGNORING THE PAST ESTABLISHED HISTORY OF THE ASSESSEE WHICH ARE ALREA DY AVAILABLE ON RECORD WITH THEM. IN THE PREVIOUS YEARS, THE REVENUE AUTHORITIES HAS ALLOWED THE BENEFIT OF INTEREST IN DISPUTE TO THE ASSESSEE BUT IN THE ASSESSMENT YEAR IN DISPUTE I FAILED TO UNDERSTAND WHY THE REVENUE HAS NOT ALLOWED THE SAME EXPENSES T O THE ASSESSEE, WHICH IS CONTRARY TO THE PRINCIPLES OF NATURAL JUSTICE AS WE LL AS WITHOUT APPRECIATING THE RECORDS AVAILABLE WITH THEM. THE LD. FIRST APPELLA TE AUTHORITY HAS ALSO PASSED THE IMPUGNED ORDER ON 28.09.2010 WITHOUT GIVING SUFFICI ENT OPPORTUNITY TO THE ASSESSEE. THE LD. FIRST APPELLATE AUTHORITY HAS DI SMISSED THE APPEAL OF THE ASSESSEE WITHOUT GIVING ANY REASON FOR THE SAME. I F THE ASSESSEE IS NOT PRESENT BEFORE THE LD. FIRST APPELLATE AUTHORITY TO PROSECU TE THE MATTER IN DISPUTE, IT IS THE DUTY OF THE LD. FIRST APPELLATE AUTHORITY TO DECIDE THE ISSUE IN DISPUTE ON THE BASIS OF MATERIAL AVAILABLE ON RECORD. AS PER THE RECORD S AVAILABLE WITH ME, THE ASSESSEE HAS FILED A VERY DETAILED GROUNDS OF APPEAL STATING ABOUT THE PAST HISTORY OF THE ASSESSEE BY DISCLOSING THAT IN THE PAST A SIMILAR R ELIEF HAS BEEN GRANTED BY THE ASSESSING OFFICER. THE ASSESSEE HAS ALSO FILED ALL THE DOCUMENTARY EVIDENCES BEFORE THE ASSESSING OFFICER WHICH HE HAS FILED BEF ORE ME IN THE SHAPE OF PAPER BOOK CONTAINING PAGE NOS.1 TO 21. THE LD. COUNSEL FOR THE ASSESSEE HAS CERTIFIED THAT THE ASSESSEE HAS FILED ALL THE DOCUMENTS MENTI ONED IN THE PAPER BOOK BEFORE 5 THE ASSESSING OFFICER. THE LD. FIRST APPELLATE AUT HORITY SHOULD HAVE CALLED FOR THE RECORDS AND DECIDED THE ISSUE IN DISPUTE ON MERIT, BUT THE SAME HAS NOT BEEN DONE. KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE, I AM OF THE CONSIDERED OPINION THAT THE LD. FIRST APPELLATE AUT HORITY HAS WRONGLY DISMISSED THE APPEAL OF THE ASSESSEE UPHOLDING THE ASSESSMENT ORD ER WHICH DESERVES TO BE CANCELLED. I CANCEL THE IMPUGNED ORDER BY DELETING THE ADDITION IN DISPUTE. 6. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS A LLOWED. (ORDER PRONOUNCED IN THE OPEN COURT ON 25.04.2011). SD/- (H.S. SIDHU) JUDICIAL MEMBER DATED: 25 TH APRIL, 2011 PBN/* COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT BY ORDER 3. CIT CONCERNED 4. CIT (APPEALS) CONCERNED 5. DR, ITAT, AGRA BENCH, AGRA 6. GUARD FILE ASSISTANT REGISTRAR INCOME-TAX APPELLATE TRI BUNAL, AGRA TRUE COPY