DCIT, New Delhi V. Sh. Upinder Kumar Widhani, New Delhi

ITA 4402/DEL/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 7366 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-08-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC 3
• Next Hearing Date: 21-06-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 11-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: FARHAT KHAN
• Assessee Lawyers: UPINDER KUMAR WIDHANI
• Keywords: Unexplained investment; Right to appeal
• Section: 142(1); 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SMC-3 NEW DELHI BEFORE SMT DIVA SINGH, JUDICIAL MEMBER I.T.A .NO.-440 2/DEL/2014 (ASSESSMENT YEAR-20 08-09) DCIT, CIRCLE-40(1), NEW DELHI (APPELLANT) VS UPINDER KUMAR WIDHANI, 513, CHANDANWARI APARTMENT, SECTOR-10, DWARKA, NEW DELHI PAN-AAGPW5236J (RESPONDENT) APPELLANT BY SH. FARHAT KHAN, SR.DR RESPONDENT BY SH. UPINDER KUMAR WIDHANI ORDER THE PRESENT APPEAL HAS BEEN FILED BY THE REVENUE AS SAILING THE CORRECTNESS OF THE ORDER DATED 28.05.2014 OF CIT(A)-XXX, NEW DELHI PER TAINING TO 2008-09 ASSESSMENT YEAR ON THE FOLLOWING GROUNDS:- 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN:- (A) DELETING THE ADDITIONS OF RS. 31,97,482/- AND RS.4,00,000/- OUT OF RS. 35,97,482/- MADE BY THE ASSESSING OFFICER U/S 144 O F IT. ACT, 1961 ON ACCOUNT OF UNEXPLAINED INVESTMENT IN SHARES WITH M/S RELIG ARE SECURITIES PVT. LTD AND VARIOUS MUTUAL FUNDS RESPECTIVELY. (B) DELETING THE ADDITIONS OF RS. 35,97,482/- BY ACCEPTING THE FRESH EVIDENCE WITHOUT GIVING THE ASSESSING OFFICER REASO NABLE OPPORTUNITY AS PER RULE 46A(3) TO EXAMINE THE FRESH EVIDENCE SUBMITTED BY THE ASSESSEE AND NOT ALLOWING REASONABLE TIME TO AO TO SUBMIT THE REMAND REPORT. (C) 'THE APPELLANT CRAVES THE RIGHT TO ALTER, AMEND, ADD OR SUBSTITUTE ALL AND ANY OF THE GROUNDS OF APPEAL DURING THE COURSE OF APPEAL.' 2. THE RELEVANT FACTS OF THE CASE ARE THAT THE ASSE SSEE DECLARED AN INCOME OF RS.3,20,190/-. THE CASE WAS SELECTED FOR SCRUTINY UNDER CASS AFTER ISSUING NOTICE U/S 143(2) AND 142(1) ETC. HOWEVER, SINCE NO ONE APPEA RED IN RESPONSE TO THE SAME, THE ASSESSMENT ORDER WAS PASSED U/S 144 MAKING AN ADDIT ION OF RS.31,97,482/- HOLDING THAT DATE OF HEARING 21 .06.2016 DATE OF PRONOUNCEMENT 19 .0 8 .2016 I.T.A .NO.-4402/DEL/2014 PAGE 2 OF 5 THE INVESTMENT IN SHARE AND IN MUTUAL FUNDS TOTALIN G TO RS.31,97,482/- REMAINED UNEXPLAINED. 3. THE ASSESSEE CAME IN APPEAL BEFORE THE CIT(A). I T WAS STATED ON BEHALF OF THE ASSESSEE THAT THE ASSESSEE CAME TO KNOW OF THE ASSE SSMENT ORDER ONLY WHEN HIS BANK INFORMED HIM THAT HIS ACCOUNT HAD BEEN ATTACHED BY THE REVENUE U/S 226(3) OF THE ACT. THEREAFTER THE ASSESSEE CONTACTED THE AO. IT WAS P LEADED THAT AT THE ADDRESS GIVEN IN THE RETURN OF INCOME, NO NOTICE HAD BEEN SERVED. T HE ADDRESS ON THE RETURN IT WAS SUBMITTED WAS 513, CHANDANWARI APARTMENT, SECTOR-10 , DWARKA, NEW DELHI, HOWEVER THE ADDRESS IN THE ASSESSMENT ORDER BY THE AO WAS 227/1 FF, POCKET-D-12, SECTOR-7, ROHINI, DELHI. ASSAILING THE ADDITIONS THE ASSESSEE FILED WRITTEN SUBMISSIONS ALONGWITH COPY OF BANK ACCOUNT AND THE STATEMENT ISSUED BY M/S RELIGA RE SECURITIES PVT. LTD. REGARDING THE SHARE TRANSACTION. SINCE THESE CONTAINED FRESH EVI DENCES, THE CIT(A) AS PER THE IMPUGNED ORDER FORWARDED THE SAME TO THE AO FOR HIS COMMENTS UNDER RULE 46A. THE REMINDERS BY THE CIT(A) TO THE AO AS PER THE FINDING RECORDED IN THE IMPUGNED ORDER AND THE FINAL OPPORTUNITY TO FORWARD THE CASE RECORD OR REPORT ET C. REMAINED UNCOMPLIED WITH THE FRESH EVIDENCES WERE ADMITTED AND CONSIDERING THE SAME TH E ADDITION WAS DELETED. AGGRIEVED THE REVENUE IS IN APPEAL. 4. LD. SR.DR IN SUPPORT OF THE GROUNDS RAISED SUBMI TTED THAT THE FRESH EVIDENCES HAVE BEEN TAKEN INTO CONSIDERATION WITHOUT CONFRONTING T HE SAME TO THE AO. HE WAS REQUIRED TO RESPOND TO THE OBSERVATIONS IN THE ORDER THAT TH E AO DID NOT RESPOND DESPITE THE CIT(A) PERSONALLY CALLING THE AO TO EXPEDITE THE REPORT AN D ALSO AFTER GIVING FINAL OPPORTUNITY VIDE LETTER DATED 19.05.2014 ALONGWITH FACTS SET OU T IN THE ORDER THAT DESPITE ISSUING VARIOUS NOTICES THE AO FAILED TO RESPOND. ACCORDIN GLY IN THE FACE OF THESE FACTS ON RECORD I.T.A .NO.-4402/DEL/2014 PAGE 3 OF 5 THE LD.SR.DR WAS REQUIRED TO SHOW HOW THE DEPARTMEN TAL REQUEST WAS MAINTAINABLE IN THE FACE OF THE AOS ADAMANCY IN NOT COMPLYING WITH DIR ECTIONS. THE LD.SR.DR WAS UNABLE TO DEFEND THE DEPARTMENTAL GROUND QUA THE OBSERVATION MADE IN THE IMPUGNED ORDER AND STATED THAT HE HAS NO FURTHER ARGUMENT. 5. THE ASSESSEE PRESENT IN PERSON VEHEMENTLY RELIED UPON THE IMPUGNED ORDER. 6. HAVING HEARD THE SUBMISSIONS AND PERUSED MATERIA L AVAILABLE ON RECORD, I AM OF THE VIEW THAT THE AO HAVING GIVEN UP HIS CLAIM IN THE R EMAND PROCEEDINGS AS REPEATEDLY AS PER RECORD HE FAILED TO RESPOND TO THE NOTICE ISSUE D BY THE CIT(A), HE CANNOT NOW CLAIM TO HAVE A GRIEVANCE AGAINST THE ORDER. THE FOLLOWING FACTS RECORDED BY THE CIT(A) REMAIN UNREBUTTED ON RECORD AND CANNOT BE TREATED LIGHTLY :- LD.AO WAS PERSONALLY CALLED UPON BY THE UNDERSIGNE D AND REQUESTED TO EXPEDITE THE REPORT. FURTHER A FINAL OPPORTUNITY W AS GIVEN TO THE LD.AO VIDE LETTER DATED 19.05.2014 AND HE WAS ALSO REQUESTED T O FORWARD THE CASE RECORD. NO REPORT UNDER RULE 46A OF THE I.T.RULE, OR CASE R ECORD RECEIVED FROM THE LD.AO. SINCE LD.AO IS NOT RESPONDING TO THE NOTICE S ISSUED BY THE UNDERSIGNED, THE APPEAL IS DECIDED ON THE BASIS OF SUBMISSIONS MADE BY THE APPELLANT. THE FRESH EVIDENCES SUBMITTED BY THE AP PELLANT IS ADMITTED. 6.1. NO ARGUMENT HAD BEEN ADVANCED TO ADDRESS WHY R EPEATEDLY THE AO FAILED TO FILE A REMAND REPORT. IN THE FACE OF THIS FAILURE ON THE PART OF THE AO, THE AO CANNOT BE SAID TO HAVE ANY GRIEVANCE. 6.2. IN THE FACTS OF THE PRESENT CASE IT IS SEEN TH AT THE CIT(A) CONSIDERING THE ISSUES CONCLUDED THE ISSUE AS UNDER:- 4. DURING THE APPELLATE PROCEEDINGS APPELLANT PLEA DED THAT HE HAS A SHARE TRANSACTION ACCOUNT WITH M/S RELIGARE SECURITIES PV T. LTD. AS PER THE TRANSACTION TOTALING DAY TO DAY SALE TRANSACTION COMES TO RS. 1 ,41,72,683.65 AGAINST THE TOTAL PURCHASES OF RS.1,38,70,221.13. ON THIS TRANS ACTION THERE IS DAY TO DAY LOSS OF RS.3,09,491.71. FROM WHERE LD.AO HAS TAKEN THE VALUE OF SHARE TRANSACTIONS AMOUNTING TO RS.31,97,482/- IS NOT CLE AR FROM THE ORDERS. EVEN LD.AO HAS NOT REPORTED THE FIGURES IN THE REMAND RE PORT. REGARDING THE INVESTMENT AMOUNTING TO RS.4,00,000/- IN MUTUAL FUN DS, IT WAS INFORMED THAT THE AMOUNT WAS PAID THROUGH CHEQUE. THE APPELLANT H AS RECEIVED CERTAIN I.T.A .NO.-4402/DEL/2014 PAGE 4 OF 5 AMOUNT FROM HIS WIFE. SHE WAS WORKING UNDER THE OFF ICE OF THE CHIEF OF THE NAVAL STAFF. AFTER THE DEATH OF APPELLANT'S SPOUSE HE HAS RECEIVED SHARES AND BANK BALANCE INCLUDING THE GPF AMOUNT OF RS.12,00,0 00/-. OUT OF THAT AND SALE PROCEED OF SHARES HE HAS INVESTED IN MUTUAL FUNDS. ALL THESE DETAILS HAVE BEEN FORWARDED TO THE LD.AO FOR HIS COMMENTS. BUT ID.AO HAS NOT OBJECTED THE EXPLANATIONS GIVEN BY THE APPELLANT. 5. I HAVE CONSIDERED THE DETAILS FILED BY THE APPEL LANT AND FIND THAT AFTER THE DEATH OF HIS SPOUSE HE HAS RECEIVED VARIOUS AMOUNTS FROM HIS WIFE'S ACCOUNT AND ALSO RS.12,00,000/- ON ACCOUNT OF GPF WHICH WAS DEPOSITED IN THE BANK ACCOUNT. FROM THESE AMOUNTS, MUTUAL FUNDS AND SHARE S WERE ACQUIRED. THE DAY TO DAY TRANSACTION OF THE SHARES ARE MORE THAN RS.31,97,482/-. SINCE THE SOURCE OF SHARES TRANSACTIONS AND INVESTMENT IN MUT UAL FUNDS AMOUNTS ARE REFLECTED IN THE BANK ACCOUNT, NO ADVERSE VIEW CAN BE TAKEN. THE APPELLANT HAS FULLY EXPLAINED THE TRANSACTIONS. THE ADDITIONS MAD E BY THE LD.AO IS HEREBY DELETED. 6.3. NO INFIRMITY IN THE ABOVE CONCLUSION HAS BEEN POINTED OUT BY THE REVENUE. IT IS FURTHER SEEN THAT NO ARGUMENT OR PLEADING ADDRESSIN G THE FACT WHY THE AO REPEATEDLY FAILED TO RESPOND HAS BEEN ARGUED. IN THE ABSENCE O F ANY FACTUAL INACCURACY BEING POINTED OUT IN THE ABOVE FINDING, I FIND NO GOOD REASON TO INTERFERE WITH THE AFORESAID FINDING. QUA THE PROCEDURAL INFIRMITY IT IS SEEN THAT AS PER REC ORD THE EVIDENCES WERE CONFRONTED TO THE AO REPEATED REMINDERS WERE ADMITTEDLY SENT REQUESTI NG THE CASE RECORD AND OR THE REPORT. FINALLY IN THE ABSENCE OF ANY RESPONSE FRO M THE AO, THE CIT(A) PROCEEDED TO CONSIDER THE SAME. IN THE ABSENCE OF ANY REBUTTAL O N THESE MATERIAL FACTS, I FIND THAT IN THE FACTS OF THE PRESENT CASE THE AO WITHOUT EVEN C ARING TO ADDRESS HIS OWN INACTIONS HAD NO OCCASION TO POSE A GRIEVANCE MOREOVER WHAT IS TH E GRIEVANCE AND WHY REMAND BE DIRECTED HAS NOT BEEN ADDRESSED. NO DOUBT THE STAT UTE VESTS THE AO WITH THE RIGHT TO FILE AN APPEAL IF THE REVENUE IS AGGRIEVED BY THE ORDER OF THE CIT(A) BUT THE RIGHT TO FILE THE APPEAL IS COUPLED WITH THE DUTY AND THE RESPONSIBIL ITY TO STAY VIGILANT, ALERT AND ATTENTIVE TOWARDS HIS OWN RESPONSIBILITIES. THE AO CANNOT BE ALLOWED TO REMAIN UNRESPONSIVE TO THE REMINDERS TO PERUSE THE FRESH EVIDENCES ADMITTED BY THE CIT(A) AND IF HE CHOOSES TO I.T.A .NO.-4402/DEL/2014 PAGE 5 OF 5 IGNORE THE SAME THEN HE DOES SO AT HIS PERIL. THE AO CANNOT BE SAID TO BE AGGRIEVED BY HIS OWN REPEATED INACTIONS. IT MAY NOT BE OUT OF C ONTEXT TO QUOTE FROM PARASHURAM POTTERY WORKS CO.LTD. VS ITO [1977] 106 ITR 1 (SC) WHEREIN THEIR LORDSHIPS WERE VERY CATEGORIC IN HOLDING THAT IT HAS BEEN SAID THAT THE TAXES ARE THE PRICE THAT WE PAY FOR CIVILIZATION. IF SO, IT IS ESSENTIAL THAT THOSE WH O ARE ENTRUSTED WITH THE TASK OF CALCULATING AND REALIZING THAT PRICE SHOULD FAMILIARIZE THEMSE LVES WITH THE RELEVANT PROVISIONS AND BECOME WELL-VERSED WITH THE LAW ON THE SUBJECT. AN Y REMISSNESS ON THEIR PART CAN ONLY BE AT THE COST OF THE NATIONAL EXCHEQUER AND MUST NECE SSARILY RESULT IN LOSS OF REVENUE. AT THE SAME TIME, WE HAVE TO BEAR IN MIND THAT THE POL ICY OF LAW IS THAT THERE MUST BE A POINT OF FINALITY IN ALL LEGAL PROCEEDINGS, THAT ST ALE ISSUES SHOULD NOT BE REACTIVATED BEYOND A PARTICULAR STAGE AND THAT LAPSE OF TIME MUST INDU CE REPOSE IN AND SET AT REST JUDICIAL AND QUASI-JUDICIAL CONTROVERSIES AS IT MUST IN OTHER SP HERES OF HUMAN ACTIVITY. 6.4. BEING SATISFIED BY THE REASONING AND FINDING A ND IN THE ABSENCE OF ANY INFIRMITY THEREIN, THE DEPARTMENTAL GROUNDS ARE DISMISSED. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 19 TH AUGUST 2016. SD/- (DIVA SINGH ) JUDICIAL ME MBER *AMIT KUMAR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR, ITAT NEW DELHI