Sh. Suresh Chand Aggarwal, New Delhi V. ITO, New Delhi

ITA 4525/DEL/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 5091 (ITAT-DELHI)
• Duration Of Justice: 11 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 21-06-2017
• Assessment Year: 2012-2013
• Appeal Filed On: 24-08-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T VASANTHAN
• Assessee Lawyers: ANAND KIRN
• Keywords: Opportunity of being heard
• Section: 143(3); 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH SMC : NEW DELHI) BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER ITA NO. 4525/DEL/2016 ASSESSMENT YEAR: 2012-13 SH. SURESH CHAND AGGARWAL, VS. ITO, WARD-25(1), C/O ANIL SHARMA & ASSOCIATES, NEW DELHI G-8, JAIN BHAWAN, 18/12, PUSA LANE WEA, KAROL BAGH, NEW DELHI 110 005 (PAN: ABDPA4321J) (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. SANKALP SHARMA, ADV. & SH. ANAND KIRN, ADV. REVENUE BY : SH. T. VASANTHAN, SR. DR ORDER THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINS T THE ORDER DATED 14.6.2016 OF THE LD. COMMISSIONER OF INCOME T AX (APPEALS)- 13, NEW DELHI RELEVANT TO ASSESSMENT YEAR 2012-13. 2. THE GROUNDS RAISED IN THE APPEAL READ AS UNDER:- I. THAT THE LD. CIT (A) HAS ERRED BOTH IN LAW AND O N FACTS IN AFFIRMING THE ASSESSMENT MADE U/S 143(3) B Y LD. INCOME TAX OFFICER DISALLOWING THE LOSS OF RS. 7,42,055/- UNDER THE HEAD 'OTHER SOURCES' AND ADDIT ION FOR LOW WITHDRAWALS FOR HOUSEHOLD EXPENSES OR RS. 1,40,0001- FAILING TO APPRECIATE THAT WHEN SECTION 14A NOT APPLICABLE TO THE FACTUAL MATRIX OF THE PRESENT CASE. 1.1 THAT THE DISALLOWANCE OF INTEREST EXPENSES ON ACCOUNT OF THE COPIES OF BANK STATEMENTS OF TWO ACCOUNTS WITH BANK 2 OF BARODA, SANCTION LETTER DATED 03.09.2009 OF ONE LOAN OF RS. 1.9 CRORES WERE FOUND TO BE ILLEGIBLE AND BE CAUSE OF THIS REASON ALONE, THE DISALLOWANCE WAS MADE. 1 2 THAT THE ABOVE FINDING IS AGAINST THE PRINCIPL ES OF EQUITY, JUSTICE AND GOOD CONSCIENCE AND INSTEAD ANOTHER OPPORTUNITY SHOULD HAVE BEEN PROVIDED TO THE ASSESS EE TO FILE COPIES OF THE EVIDENCE ON RECORD AS THE COP IES OF BANK STATEMENTS AND LOAN SANCTION LETTER WERE ILLEG IBLE BECAUSE OF POOR PRINT QUALITY OF THE PRINTER FROM W HICH THE CLERK TOOK THE PRINTOUTS. 1.3 THAT THE OPPORTUNITY TO SEEK JUSTICE HAS BEEN DENIED TO THE ASSESSEE ON THE BASIS OF A CLERICAL ERROR. 2. THAT THE LD. CIT(A) HAS FAILED TO APPRECIATE THE EVIDENCES REGARDING THE USE OF THE LOAN TAKEN FROM BANK AND HAS WRONGLY DISALLOWED THE AMOUNT BASED ON ASSUMPTIONS AND SURMISES. 3. THAT THE ESTIMATION OF LIVING EXPENSES OF RS . 20,000/- PER MONTH IN F.Y. 2011-12 TO BE REGARDED AS TOO LOW FOR A FAMILY OF THREE CANNOT BE REGARDED AS BASED ON AN Y PRINCIPLE OF LAW OR COMMON SENSE AS SUCH AMOUNT OF MONEY IS ENOUGH FOR A FAMILY OF THREE TO LIVE A SIM PLE AND DECENT LIFESTYLE WHEN THERE ARE NO EXPENSES FOR RENT EDUCATION AND SUCH OTHER LIKE EXPENSES. 3.1 THAT THE ASSESSEE'S FAMILY MEMBERS SMT. PREM LATA AGGARWAL AND HIS WIFE SMT. MAMTA AGRAWAL ARE ALSO EARNING MEMBERS OF THE FAMILY AND THEIR INCOME IS A LSO UTILISED BY THE FAMILY FOR NORMAL HOUSEHOLD EXPENSE S. LD. 3 CLT (A) HAS FAILED TO TAKE THIS FACT INTO CONTEMPLA TION BY NOT CONSIDERING THE DOCUMENTARY EVIDENCES SUBMITTED DURING THE ASSESSMENT PROCEEDINGS. IT IS, THEREFORE, PRAYED THAT THE APPELLATE ORDER OF LD. CIT(A) BE QUASHED AND IN ANY CASE, THE DISALLOWANCE AND ADDITION MADE BE ALLOWED AND DELETED RESPECTIVELY. 3. FACTS NARRATED BY THE REVENUE AUTHORITIES ARE NO T DISPUTED BY BOTH THE PARTIES, HENCE, THE SAME ARE NOT REPEATED HERE FOR THE SAKE OF BREVITY. 4. DURING THE HEARING, LD. A.R. OF THE ASSESSEE, HA S STATED THAT LD. CIT(A) HAS NOT GIVEN HIM CHANCE TO APPEAR BEFOR E HIM AND WRONGLY AFFIRMED THE ASSESSMENT MADE U/S. 143(3) OF THE INCOME TAX ACT, 1961 BY THE AO DISALLOWING THE LOSS OF RS . 7,42,055/- UNDER THE HEAD 'OTHER SOURCES' AND ADDITION FOR LOW WITHD RAWALS FOR HOUSEHOLD EXPENSES OR RS. 1,40,0001- FAILING TO APP RECIATE THAT WHEN SECTION 14A NOT APPLICABLE TO THE FACTUAL MATRIX OF THE PRESENT CASE. HE FURTHER STATED THAT THE DISALLOWANCE OF INTERES T EXPENSES ON ACCOUNT OF THE COPIES OF BANK STATEMENTS OF TWO ACC OUNTS WITH BANK OF BARODA, SANCTION LETTER DATED 03.09.2009 OF ONE LOAN OF RS. 1.9 CRORES WERE FOUND TO BE ILLEGIBLE AND BECAUSE OF TH IS REASON ALONE, THE DISALLOWANCE WAS MADE. HE FURTHER STATED THAT T HE ABOVE FINDING IS AGAINST THE PRINCIPLES OF EQUITY, JUSTICE AND GO OD CONSCIENCE AND INSTEAD ANOTHER OPPORTUNITY SHOULD HAVE BEEN PROVID ED TO THE ASSESSEE TO FILE COPIES OF THE EVIDENCE ON RECORD A S THE COPIES OF BANK STATEMENTS AND LOAN SANCTION LETTER WERE ILLEG IBLE BECAUSE OF 4 POOR PRINT QUALITY OF THE PRINTER FROM WHICH THE CL ERK TOOK THE PRINTOUTS. HE FURTHER STATED THAT THE OPPORTUNITY TO SEEK JUSTICE HAS BEEN DENIED TO THE ASSESSEE ON THE BASIS OF A CLERI CAL ERROR. HE FURTHER STATED THAT LD. CIT(A) HAS FAILED TO APPREC IATE THE EVIDENCES REGARDING THE USE OF THE LOAN TAKEN FROM BANK AND H AS WRONGLY DISALLOWED THE AMOUNT BASED ON ASSUMPTIONS AND SURM ISES. LD. COUNSEL OF THE ASSESSEE FURTHER STATED THAT THE ES TIMATION OF LIVING EXPENSES OF RS. 20,000/- PER MONTH IN F.Y. 2011-12 TO BE REGARDED AS TOO LOW FOR A FAMILY OF THREE CANNOT BE REGARDED AS BASED ON ANY PRINCIPLE OF LAW OR COMMON SENSE AS SUCH AMOUNT OF MONEY IS ENOUGH FOR A FAMILY OF THREE TO LIVE A SIMPLE AND D ECENT LIFESTYLE WHEN THERE ARE NO EXPENSES FOR RENT EDUCATION AND S UCH OTHER LIKE EXPENSES. HE FURTHER STATED THAT THE ASSESSEE'S FAM ILY MEMBERS SMT. PREM LATA AGGARWAL AND HIS WIFE SMT. MAMTA AGR AWAL ARE ALSO EARNING MEMBERS OF THE FAMILY AND THEIR INCOME IS A LSO UTILISED BY THE FAMILY FOR NORMAL HOUSEHOLD EXPENSES AND LD. CI T (A) HAS FAILED TO TAKE THIS FACT INTO CONTEMPLATION BY NOT CONSIDE RING THE DOCUMENTARY EVIDENCES SUBMITTED DURING THE ASSESSME NT PROCEEDINGS. LD. COUNSEL OF THE ASSESSEE HAS STATE D THAT ASSESSEE IS IN A POSSESSION OF ALL THE DOCUMENTS/ EVIDENCES T O SUBSTANTIATE ITS CASE BEFORE THE LD. CIT(A) AND THEREFORE, REQUESTE D THE BENCH TO SET ASIDE THE ISSUES IN DISPUTE TO THE FILE OF THE LD. CIT(A) TO DECIDE THE SAME AFRESH, UNDER THE LAW, AFTER GIVING ADEQUA TE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 5 5. ON THE CONTRARY, LD. DR RELIED UPON THE ORDERS O F THE AUTHORITIES BELOW. 6. I HAVE HEARD BOTH THE PARTIES AND PERUSED THE RE CORDS, ESPECIALLY THE ORDERS OF THE AUTHORITIES BELOW. I FIND THAT LD. CIT(A) HAS NOT GIVEN PROPER CHANCE TO THE ASSESSEES COUN SEL TO SUBSTANTIATE ITS CASE AND WRONGLY AFFIRMED THE ASSE SSMENT MADE U/S. 143(3) OF THE INCOME TAX ACT, 1961 BY THE AO DISAL LOWING THE LOSS OF RS. 7,42,055/- UNDER THE HEAD 'OTHER SOURCES' AN D ADDITION FOR LOW WITHDRAWALS FOR HOUSEHOLD EXPENSES OR RS. 1,40, 000/- FAILING TO APPRECIATE THAT WHEN SECTION 14A NOT APPLICABLE TO THE FACTUAL MATRIX OF THE PRESENT CASE. I FURTHER NOTE THAT THE DISA LLOWANCE OF INTEREST EXPENSES ON ACCOUNT OF THE COPIES OF BANK STATEMENT S OF TWO ACCOUNTS WITH BANK OF BARODA, SANCTION LETTER DATED 03.09.2009 OF ONE LOAN OF RS. 1.9 CRORES WERE FOUND TO BE ILLEGIB LE AND BECAUSE OF THIS REASON ALONE, THE DISALLOWANCE WAS MADE. I FUR THER FIND THAT THE ABOVE FINDING IS AGAINST THE PRINCIPLES OF EQUITY, JUSTICE AND GOOD CONSCIENCE AND INSTEAD ANOTHER OPPORTUNITY SHOULD H AVE BEEN PROVIDED TO THE ASSESSEE TO FILE COPIES OF THE EVID ENCE ON RECORD AS THE COPIES OF BANK STATEMENTS AND LOAN SANCTION LET TER WERE ILLEGIBLE BECAUSE OF POOR PRINT QUALITY OF THE PRINTER FROM W HICH THE CLERK TOOK THE PRINTOUTS. I FURTHER FIND COGENCY IN THE CONTEN TION OF THE LD. COUNSEL OF THE ASSESSEE THAT THE OPPORTUNITY TO S EEK JUSTICE HAS BEEN DENIED TO THE ASSESSEE ON THE BASIS OF A CLERI CAL ERROR. I NOTE THAT LD. CIT(A) HAS FAILED TO APPRECIATE THE EVIDEN CES REGARDING THE 6 USE OF THE LOAN TAKEN FROM BANK AND HAS WRONGLY DIS ALLOWED THE AMOUNT BASED ON ASSUMPTIONS AND SURMISES. I FURTHER FIND COGENCY IN THE SUBMISSIONS OF THE LD. COUNSEL OF THE ASSE SSEE THAT THE ESTIMATION OF LIVING EXPENSES OF RS. 20,000/- PER MONTH IN F.Y. 2011-12 TO BE REGARDED AS TOO LOW FOR A FAMILY OF T HREE CANNOT BE REGARDED AS BASED ON ANY PRINCIPLE OF LAW OR COMMON SENSE AS SUCH AMOUNT OF MONEY IS ENOUGH FOR A FAMILY OF THREE TO LIVE A SIMPLE AND DECENT LIFESTYLE WHEN THERE ARE NO EXPENSES FOR REN T EDUCATION AND SUCH OTHER LIKE EXPENSES. IT WAS FURTHER NOTED THAT THE ASSESSEE'S FAMILY MEMBERS SMT. PREM LATA AGGARWAL AND HIS WIFE SMT. MAMTA AGRAWAL ARE ALSO EARNING MEMBERS OF THE FAMILY AND THEIR INCOME IS ALSO UTILISED BY THE FAMILY FOR NORMAL HOUSEHOLD EX PENSES AND LD. CIT (A) HAS FAILED TO TAKE THIS FACT INTO CONTEMPLA TION BY NOT CONSIDERING THE DOCUMENTARY EVIDENCES SUBMITTED DUR ING THE ASSESSMENT PROCEEDINGS. I NOTE THAT AT PRESENT THE LD. COUNSEL OF THE ASSESSEE IS IN A POSSESSION OF ALL THE DOCUME NTS/ EVIDENCES TO SUBSTANTIATE ITS CASE BEFORE THE LD. CIT(A), WHICH HAS NOT BEEN CONSIDERED BY THE LD. CIT(A) WHILE DECIDING THE APP EAL, WHICH IS NOW DESERVE TO BE APPRECIATED. THEREFORE, IN THE INTERE ST OF JUSTICE, I SET ASIDE THE ISSUES IN DISPUTE TO THE FILE OF THE LD. CIT(A) TO DECIDE THE SAME AFRESH, UNDER THE LAW, AFTER GIVING ADEQUATE O PPORTUNITY OF BEING HEARD TO THE ASSESSEE, AFTER APPRECIATING THE DOCUMENTS/EVIDENCES TO BE FILED BY THE ASSESSEE. TH E ASSESSEE IS ALSO DIRECTED TO FULLY COOPERATE WITH THE LD. CIT(A ) DURING THE 7 PROCEEDINGS AND FILE ALL THE DOCUMENTS/ EVIDENCES A ND DID NOT TAKE ANY UNNECESSARY ADJOURNMENT. 7. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON THIS 08-08-2017. SD/- (H.S. SIDHU) JUDICIAL MEMBER DATED : 08-08-2017 SR BHATANGAR COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A), NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.