ITO, CHITTORGARH V. Sh. Sujan Mal Bohra, CHITTORGARH

ITA 446/JODH/2010

• Counselvise Citation: 44623314 RSA 2010
• Duration Of Justice: 1 year(s) 4 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-12-2011
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 14-12-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 26-07-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: G R KOKANI
• Keywords: Opportunity of being heard
• Section: 68; 148

Judgement Text

1 ITA 446(5)-10 IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH JODHPUR. ( BEFORE SHRI R.K. GUPTA AND SHRI N.L. KALRA ) ITA NO. 446 & 447/JODH/2010 ASSTT. YEAR : 2006-07 2007-08. THE INCOME-TAX OFFICER, VS. SHRI SUJAN MAL BOHRA, WARD-3, CHITTORGARH. 17-A, GANDHI NAGAR, CHITTO RGARH. ITA NO. 448/JODH/2010 ASSTT. YEAR : 2007-08. THE INCOME-TAX OFFICER, VS. SHRI SHANTI LAL DHAKA R, WARD-3, CHITTORGARH. SUKHWARA, CHITTORGARH. ITA NO. 472/JODH/2010 ASSTT. YEAR : 2007-08. THE INCOME-TAX OFFICER, VS. SHRI MADAN LAL DHAKAD , WARD-3, CHITTORGARH. SUKHWARA, TEHSIL BHADESAR, CHITTORGARH. ITA NO. 497/JODH/2010 ASSTT. YEAR : 2007-08. THE INCOME-TAX OFFICER, VS. SHRI SHANTI LAL, WARD-3, CHITTORGARH. PROP. M/S. SISODIA BOOT MO JRI HOUSE, SADAR BAZAR, CHITTORGARH. (APPELLANT) (RESPONDENTS) APPELLANT BY : SHRI G.R. KOKANI RESPONDENT BY : SHRI P.C. PARWAL DATE OF HEARING : 14.12.2011. DATE OF PRONOUNCEMENT : 15.12.2011. 2 ORDER DATED : 15/12/2011. PER R.K. GUPTA, J.M. THESE ARE FIVE APPEALS BY THE DEPARTMENT RELATING TO FOUR DIFFERENT ASSESSEES I.E. SHRI SUJAN MAL BOHRA, SHRI MADAN LAL DHAKAR, SHRI S HANTI LAL DHAKAR & SHRI SHANTI LAL RELATING TO ASSESSMENT YEARS 2006-07 AND 2007-08. 2. IN ALL THESE CASES THE NOTICE UNDER SECTION 148 WAS ISSUED ON RECEIVING SOME INFORMATION THAT ASSESSEE HAS DEPOSITED SOME CASH I N BANK AGAINST HUNDIES AND NO RETURN HAS BEEN FILED BY ALL THESE PERSONS. ACCORDINGLY N OTICE UNDER SECTION 148 WAS ISSUED. THEREAFTER, THE ASSESSEES FILED RETURNS OF INCOME S HOWING INCOME IN CASE OF SHRI SUJAM MAL BOHRA AT RS. 52,000/- AND RS. 58,000/- RESPECTI VELY FOR BOTH THE YEARS, IN CASE OF SHRI SHANTI LAL DHAKAR AT RS. 18,000/-, IN CASE OF SHRI MADAN LAL DHAKAR AT RS. 24,000/- AND IN CASE OF SHRI SHANTI LAL AT RS. 70,300/-. THEREA FTER NOTICE UNDER SECTION 143(2) WAS ISSUED AND ASSESSEE WAS REQUIRED TO EXPLAIN THE NAT URE OF PROMISSORY NOTE AND BANK CREDITS AND WHY THE SAME SHOULD NOT BE ADDED UNDER SECTION 68 ALONG WITH INTEREST EARNED ON THEM. DETAILED SUBMISSIONS WERE FILED. HOWEVER , THE ASSESSING OFFICER WAS NOT SATISFIED. ACCORDINGLY, HE MADE THE ADDITIONS ON A CCOUNT OF PROMISSORY NOTE AND BANK CREDIT ALONG WITH THE INTEREST. IN THIS WAY, THE A SSESSMENT WAS COMPLETED AT RS. 11,49,200/- FOR A.Y. 2006-07, AT RS. 24,04,240/- FO R A.Y. 2007-08 IN CASE OF SHRI SUJAN MAL BOHRA, IN CASE OF SHRI SHANTI LAL DHAKAR THE AS SESSMENT WAS COMPLETED AT RS. 22,11,360/-, IN CASE OF SHRI MADAN LAL DHAKAR AT RS . 20,14,402/- AND IN CASE OF SHRI SHANTI LAL AT RS. 8,63,820/-. ALL THESE ASSESSEES PREFERRED APPEALS BEFORE LD. CIT (A). INITIATION OF PROCEEDINGS UNDER SECTION 148 WAS CHA LLENGED. AFTER CONSIDERING THE SUBMISSIONS AND PERUSING THE MATERIAL ON RECORD, TH E LD. CIT (A) FOUND THAT THERE WAS NO PROPER REASONS RECORDED IN RESPECT TO ESCAPEMENT OF INCOME. ALL THESE ASSESSEES WERE 3 PERSON OF SMALL MEANS AND THEY WERE NOT HAVING ANY CAPITAL TO EARN THIS AMOUNT. ALL THE ASSESSEES ARE NOT REGULARLY ASSESSED TO TAX AS THEI R INCOME REMAINED BELOW TAXABLE. THEREFORE, HE HELD THAT INITIATION OF PROCEEDINGS U NDER SECTION 148 WAS BAD IN LAW. ACCORDINGLY, THE ASSESSMENTS IN THESE CASES WERE QU ASHED. NO DECISION ON MERIT WAS GIVEN BY LD. CIT (A) AS HE ALLOWED THE LEGAL GROUND IN FAVOUR OF ALL THESE ASSESSEES. 3. NOW THE DEPARTMENT IS IN APPEAL HERE BEFORE THE TRIBUNAL IN CASE OF ALL THESE ASSESSEES. 4. THE LD. D/R STATED THAT THERE WAS NO RETURN OF I NCOME AND ASSESSING OFFICER HAS RECEIVED SPECIFIC INFORMATION BY WHICH IT WAS SEEN THAT THESE ASSESSEES HAD EARNED INTEREST INCOME AND THE SAME HAS NOT BEEN SHOWN. S INCE ALL THESE ASSESSEES HAVE NOT FILED THEIR RETURN OF INCOME, THEREFORE, HE ISSUED NOTICE UNDER SECTION 148 AFTER RECORDING THE REASONS. ACCORDINGLY ISSUANCE OF NOTICE UNDER SECT ION 148 WAS VALID. IT WAS ALSO SUBMITTED THAT ALL THESE ASSESSEES HAD FILED DETAIL S AND AFTER CONSIDERING THE SAME THEN ONLY THE ASSESSING OFFICER HAS PASSED ASSESSMENT IN ALL THESE CASES. ACCORDINGLY, IT WAS SUBMITTED THAT LD. CIT (A) WAS NOT JUSTIFIED IN QUA SHING THE ASSESSMENT BY HOLDING THAT ISSUANCE OF NOTICE UNDER SECTION 148 WAS BAD IN LAW . 5. ON THE OTHER HAND, THE LD. COUNSEL OF THE ASSESS EE REITERATED THE CONTENTION RAISED BEFORE LD. CIT (A). IT WAS FURTHER SUBMITTED THAT ALL THESE PERSONS WERE SMALL MEANS OF PERSONS AND THE BANK MANAGER HAD OBTAINED THEIR SIG NATURES AND THEREAFTER A COMPLAINT WAS FILED AND THE BANK MANAGER WAS ARRESTED ALSO. ACCORDINGLY, IT WAS SUBMITTED THAT A LENIENT VIEW IN FAVOUR OF THE ASSESSEES MAY BE TAKE N. IT WAS ALSO SUBMITTED THAT ALL THESE ASSESSEES HAVE NOT ADVANCED ANY LOANS ON THE PROMIS SORY NOTE. THE BANK MANAGER OBTAINED THESE PROMISSORY NOTES BY PUTTING THE SIGN ATURE OF THESE ASSESSEES IN ORDER TO SANCTION THE LOANS AND FOR SUCH ACTION HE HAD BEEN SUSPENDED ALSO. THE PERSONS ON 4 WHOSE NAMES THE LOANS WERE SANCTIONED HAVE ALSO CON FIRMED THAT THEY HAVE NOT TAKEN ANY LOAN FROM THESE PERSONS AND IT WAS ONLY AN ACCOMMOD ATION ARRANGEMENT FOR WHICH THE ASSESSEE RECEIVED SOME COMMISSION AND THE SAME HAVE BEEN SHOWN IN THE RETURN FILED IN RESPONSE TO NOTICE UNDER SECTION 148. ALL THE RETU RNS ARE BELOW TAXABLE. THEREFORE, ACTION OF THE LD. CIT (A) IS LIABLE TO BE SUSTAINED. 6. WE HAVE HEARD RIVAL SUBMISSIONS AND CONSIDERED T HEM CAREFULLY. AFTER CONSIDERING THE SUBMISSIONS AND PERUSING THE MATERI AL ON RECORD, WE ARE OF THE VIEW THAT ISSUANCE OF NOTICE UNDER SECTION 148 WAS VALID AS A SSESSING OFFICER HAS INFORMATION THAT CERTAIN LOANS WERE SANCTIONED AND INTEREST HAS BEEN EARNED ON THE SAME IN THE NAME OF THESE ASSESSEES AND TO EXAMINE AND ASCERTAIN THE FA CTUAL ASPECTS, THE NOTICE UNDER SECTION 148 WAS ISSUED AS THERE WAS NO REGULAR RETURN FILED BY THESE ASSESSEES. WITHOUT ISSUING NOTICE UNDER SECTION 148 HOW THE ASSESSING OFFICER CAN EXAMINE THE VERACITY OF THESE PERSONS. THEREFORE, IN OUR CONSIDERED VIEW, THE IS SUANCE OF NOTICE UNDER SECTION 148 WAS VALID AND THIS FACT WAS BROUGHT TO THE KNOWLEDGE OF THE LD. A/R, WHO, THOUGH WAS NOT READY TO AGREE BUT HE STATED THAT THESE PERSONS ARE OF SMALL MEANS, THEREFORE, IF THE PROCEEDINGS UNDER SECTION 148 ARE UPHELD EVEN THEN THERE IS NO TAXABLE INCOME. WHETHER THERE IS A TAXABLE INCOME OR NOT IS NOT THE MATTER BEFORE US, BUT THE ISSUE BEFORE US IS THAT WHETHER ISSUANCE OF NOTICE UNDER SECTION 148 WAS CO RRECT OR NOT AND IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES, IT IS CLEARLY SEEN THAT IS SUANCE OF NOTICE UNDER SECTION 148 WAS VALID. ACCORDINGLY, WE HLD THAT THE ASSESSING OFFI CER WAS CORRECT IN INITIATING PROCEEDINGS UNDER SECTION 148 IN CASE OF ALL THESE ASSESSEES AND THE LD. CIT (A) WAS NOT JUSTIFIED IN HOLDING THAT ISSUANCE OF NOTICE UNDER SECTION 148 WAS BAD IN LAW. THE ORDER OF LD. CIT (A) IS SET ASIDE ON THIS ISSUE. WE FURT HER NOTED THAT AS THESE PERSONS HAVE NO REGULAR SOURCE OF INCOME AND DEPENDENT UPON THEIR O THER FAMILY MEMBERS, PERSONS ARE 5 BPL CARDHOLDER AND JOB HOLDER UNDER NREGA, THEREFOR E, WE FEEL THAT THE ASSESSING OFFICER SHOULD EXAMINE THE CASE IN THIS PERSPECTIVE WHILE PASSING A FRESH ORDER AS WE HAVE SET ASIDE THE ISSUE TO HIS FILE IN ALL THESE C ASES FOR PASSING A FRESH ORDER INSTEAD OF SENDING BACK THE MATTER TO THE FILE OF LD. CIT (A) AS THESE ASPECTS WERE NOT CONSIDERED BY THE ASSESSING OFFICER WHILE PASSING ASSESSMENT. TH E ASSESSING OFFICER WILL ALSO TAKE INTO CONSIDERATION THE FACT THAT THE BANK MANAGER O BTAINED THESE PROMISSORY NOTES BY GETTING THE SIGNATURES OF THESE PERSONS WHO WAS LAT ER ON SUSPENDED FROM HIS JOB. THE FACT THAT THE PERSONS WHO TOOK LOAN HAVE DENIED HAVING T AKEN LOAN FROM THESE ASSESSEES, SHOULD ALSO BE EXAMINED BY THE ASSESSING OFFICER IN RIGHT PERSPECTIVE AND AFTER AFFORDING A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSE SSEE. WE ORDER ACCORDINGLY. 7. IN THE RESULT, THE APPEALS OF THE DEPARTMENT ARE ALLOWED FOR STATISTICAL PURPOSES. 8. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 15. 12.2011. SD/- SD/- ( N.L. KALRA ) ( R.K. GUPTA ) ACCOUNTANT MEMBER JUDICIAL MEMBER JODHPUR, COPY FORWARDED TO :- THE ITO WARD 3, CHITTORGARH. SHRI SUJAN MAL BOHRA, CHITTORGARH. SHRI SHANTI LAL DHAKAD, CHITTORGARH. SHRI MADAN LAL DHAKAD, CHITTORGARH. SHRI SHANTI LAL, CHITTORGARH. THE CIT (A) THE CIT THE D/R GUARD FILE (ITA NO. 446(5)/JODH/2010) BY ORDER, AR ITAT JODHPUR. ``````````````````````````````````````````````````` ``````````````````````````````````````````````````` `````` ````````