Vishnu Kumar and Brothers, Delhi V. ITO, New Delhi

ITA 4523/DEL/2011

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 7508 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-12-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 24-11-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 10-10-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J P CHANDRAKAR
• Keywords: Opportunity of being heard
• Section: 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: H NEW DELHI BEFORE SHRI N. K. SAINI, ACCOUNTANT MEMBER AND SHRI C. M. GARG, JUDICIAL MEMBER I.T.A .NO. - 4523 /DEL/201 1 (ASSESSMENT YEAR - 200 8 - 0 9 ) SHRI VISHNU KUMAR AND BROTHERS VS. ITO 2369, CHATTA SHAHJI CHAWRI WARD - 29(2), BAZAR, DELHI - 110006. NEW DELHI. PAN: AAAFV5850H (APPELLANT) (RESPONDENT) ASSESSEE BY: - SH. P. C. YADAV, ADV. REVENUE BY: - SH. J.P. CHANDRAKAR, SR.DR. DATE OF HEARING: 24.11.2014 ORDER PRONOUNCED ON: 11 .1 2 .2014 ORDER PER N. K. SAINI, AM THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER DATED 23 . 08 .201 1 OF LD. CIT (APPEALS) - X XV , NEW DELHI. 2. THE FIRST ISSUE IN THIS APPEAL VIDE GROUND NO. 1 RELATES TO THE SUSTENANCE OF ADDITION OF RS.5,13,000/ - MADE BY THE AO U/S 41(1) OF THE INCOME TAX ACT, 1961, (HEREINAFTER REFERRED THE ACT ). 3. THE FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESSEE WAS ENGAGED IN THE BUSINESS OF TRADING OF PAPERS AND FILED THE RETURN OF INCOME ON 24.09.2008, DECLARING NIL INCOME. LATTER ON THE CASE WAS SE LECTED FOR SCRUTINY. D URING THE COURSE OF ASSESSMENT PROCEEDINGS THE AO ACCEPTED THE TRADIN G RESULTS HOWEVER, HE NOTICED THAT THE ASSESSEE HAD SHOWN ONE OF THE CREDITORS I.E. M/S J.K. PAPER 2 LTD. WITH A BALANCE OF RS.26,28,947/ - WHILE THE SAID PARTY U/S 133(6) OF THE ACT HAD SHOWN CLOSING BALANCE AT RS.31,41,947/ - . THE AO ASKED THE ASSESSEE TO F URNISH THE EXPLANATION FOR THE DIFFERENCE OF RS.5,13,000/ - . I N RESPONSE THE ASSESSEE STATED THAT THERE WERE CERTAIN DEBIT AND CREDIT ENTRIES WHICH HAVE NOT BEEN CONSIDERED BY BOTH THE PARTIES. THE AO DID NOT FIND ANY MERIT IN THE SUBMISSIONS OF THE ASSESSE E BY OBSERVING THAT THE ASSESSEE HAD NOT GIVEN ANY EVIDENCE. ACCORDINGLY ADDITION OF RS.5,13,000/ - WAS MADE . B EING AGGRIEVED THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT(A) WHO CONFIRMED THE ADDITION MADE BY THE AO. 4. NOW THE ASSESSEE IS IN APPEAL . T HE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT NEITHER THE AO NOR THE LD. CIT(A) PROPERLY APPRECIATED THE FACTS I N RIGHT PROSPECTIVE PARTICULAR THIS CONTENTION THAT EITHER OF THE PARTIES HAD NOT CONSIDERED CERTAIN DEBIT AND CREDIT ENTRIES WHICH WAS THE MAIN REASON FOR DIFFERENCE IN THE BALANCE SHEET SHOWN BY THE ASSESSEE AND THE RESPECTIVE P ARTY . HE REQUESTED THAT THE ISSUE MAY BE SENT BACK TO THE AO FOR CONSIDERING THE RECONCILIATION FURNISHED BY THE ASSESSEE. IN HIS RIVAL SUBMISSIONS , THE LD. DR SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 5. WE HAVE CONSIDERED THE SUBMISSIONS , OF BOTH THE PARTIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. IN THE INSTANT CASE, IT APPEARS THAT THE EXPLANATION OF THE ASSESSEE THAT C ERTAIN DEBIT AND CREDIT ENTRIES WERE NOT CONSIDERED BY EITHER OF THE PARTIES I. E. ASSESSEE AND THE CREDITOR WHICH RESULTED INTO THE IMPUGNED DIFFERENCE IN THE CLOSING BALANCE, HAS NOT BEEN APPRECIATED 3 PROPERLY BY THE AUTHORITIES BELOW . WE THEREFORE, DEEM I T APPROPRIATE TO REMAND THIS ISSUE BACK TO THE FILE OF THE AO FOR ADJUDICATIN G IT AFRESH IN ACCORDANCE WITH LAW A FTER PRO VIDING DUE AND REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 6. THE NEXT ISSUE VIDE GROUND NO. 2 RELATES TO THE SUSTENANCE OF ADDITION OF RS.38,573/ - MADE BY THE AO OUT OF TELEPHONE EXPENSES . T HE FACTS RELATED TO THIS ISSUE IN BRIEF ARE THAT THE ASSESSEE INCURRED TELEPHONE EXPENSES OF RS.85,975/ - . T HE AO FOUND THAT A SUM OF RS.43,216/ - WAS RELATED TO THE TELEPHONE INSTALLED AT THE RESIDENCE OF THE PARTNERS AND THE ASSESSEE HAD PAID FRINGE B ENEFIT T AX (FBT) ON EXPENSES OF RS. 8,643/ - . THE AO THEREFORE, MADE THE ADDITION OF RS.38,573/ - (RS.43,216/ - ( - ) RS.8643/ - ). B EING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT(A ) WHO SUST AINED THE ADDITION MADE BY THE AO. 7. NOW THE ASSESSEE IS IN APPEAL. DURING THE COURSE OF HEARING THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE PAID THE FRINGE B ENEFIT T AX (FBT) ON THE TELEPHONE EXPENSES WHICH INCLUDED THE EXPENSE S RELATED TO THE TELEPHONE INSTALLED AT THE RESIDENCE OF THE PARTNERS BUT THE AO CONSIDERED THE AMOUNT OF FRINGE B ENEFIT T AX (FBT) DEPOSITED AS AN AMOUNT ON WHICH FRINGE BENEFIT T AX WAS PAID. HE REQUESTED THAT THIS ISSUE MAY ALSO BE SENT TO THE AO FOR PROPER VERIFICATION AND DECIDING THE SAME ON MERITS. I N HIS RIVAL SUBMISSIONS, THE LD. DR SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 4 8. AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE PARTIES AND PERUSING THE MATERIAL ON RECORD, WE ARE OF THE OPINI ON THAT THIS ISSUE REQUIRES A FRESH ADJUDICATION AT THE LEVEL OF THE AO BECAUSE THE CONTENTION OF THE LD. COUNSEL FOR THE ASSESSEE THAT THE AMOUNT OF THE FRINGE B ENEFIT T AX DEPOSITED I.E. RS.8,643/ - ON THE TOTAL EXPENSES OF RS.43,216/ - WAS WRONGLY CONSIDER ED BY THE AO AS AN AMOUNT ON WHICH FRINGE B ENEFIT T AX (FBT) WAS PAID. ACCORDINGLY THIS ISSUE IS REMAND BACK TO THE AO FOR ADJUDICATING A FRESH , IN ACCORDANCE WITH LAW AFTER PROVIDING DUE AND REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 9. IN THE RESULT, APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER P RONOUNCED IN THE OPEN COURT ON 1 1 /1 2 /2014. S D / - S D / - (C. M. GARG) (N. K. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 1 1 /1 2 /2014 *AK VERMA* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR