Praveen Kumar Agarwal, Kanpur V. ACIT, Kanpur

ITA 453/LKW/2011

• Counselvise Citation: 45323714 RSA 2011
• Duration Of Justice: 3 year(s) 1 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-08-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 15-07-2014
• Assessment Year: misc
• Appeal Filed On: 21-07-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIVEK MISHRA
• Keywords: Unexplained investment; Unexplained expenditure; Search and seizure; Loose papers; Document seized; Opportunity of being heard; Peak credit; Documents seized

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.453/LKW/2011 ASSESSMENT YEAR:BLOCK PERIOD ENDING ON 08/05/2003 SHRI PRAVEEN KUMAR AGARWAL, 24/68, BIRHANA ROAD, KANPUR. PAN:AEQPA4614J VS. A.C.I.T., CENTRAL CIRCLE - II, KANPUR. (APPELLANT) (RESPONDENT) APPELLANT BY SHRI SHYAM SUNDER GUPTA, FCA SHRI ASHISH JIASWAL, ADVOCATE RESPONDENT BY SHRI VIVEK MISHRA, CIT, D.R. DATE OF HEARING 15/07/2014 DATE OF PRONOUNCEMENT 2 2 /08/2014 O R D E R PER A. K. GARODIA, A.M. THIS IS AN ASSESSEES APPEAL DIRECTED AGAINST THE ORDER PASSED BY LEARNED CIT(A) - I, KANPUR DATED 18/05/2011 FOR THE BLOCK PERIOD ENDING ON 08/05/2003. 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER: 1. THAT LD. CIT(A) HAS ERRED IN DISMISSING THE APPEAL FILED BY THE ASSESSEE. 2. THAT LD. CIT(A) HAS ERRED IN NOT PROPERLY APPRECIATING THE GROUNDS ON WHICH APPLICATION FOR ADJOURNMENT HAS BEEN SOUGHT AND IN NOT ALLO WING AT LEAST ONE OPPORTUNITY OF HEARING AFTER REJECTION OF ADJOURNMENT APPLICATION. 3. THAT LD. CIT(A) HAS ERRED IN NOT DISPOSING THE APPEAL ON MERITS AND SUMMARILY DISMISSING THE APPEAL. 2 4. THAT LD. CIT(A) HAS ERRED IN CONSEQUENTLY CONFIRMING ADDITION OF RS.59,73,799.00 ON ACCOUNT OF UNEXPLAINED PEAK CREDIT BASED ON SEIZED MATERIAL. 5. THAT LD. CIT(A) HAS ERRED IN CONSEQUENTLY CONFIRMING ADDITION ON ACCOUNT OF UNDISCLOSED PROFIT ON TRADING AT RS.1,29,52,278.00. 6. THAT LD. CIT(A) HAS ERRED IN CONSEQUE NTLY CONFIRMING ADDITION ON ACCOUNT OF UNEXPLAINED INVESTMENT IN STOCK AT RS.3,87,000.00. 7. THAT LD. CIT(A) HAS ERRED IN CONSEQUENTLY CONFIRMING ADDITION ON ACCOUNT OF UNEXPLAINED EXPENDITURE BASED ON LOOSE PAPERS II/1 AT RS.910.00. 8. THAT LD. CIT(A) HAS ERRED IN CONSEQUENTLY CONFIRMING ADDITION ON ACCOUNT OF UNEXPLAINED EXPENDITURE ON MINERAL WATER DISPENSER AT RS.8900.00. 9. THAT LD. CIT(A) HAS ERRED IN CONSEQUENTLY CONFIRMING ADDITION ON ACCOUNT OF UNEXPLAINED EXPENDITURE ON PURCHASE OF TV AT RS.32 ,000.00. 10. THAT LD. CIT(A) HAS ERRED IN NOT DECIDING THE ISSUE REGARDING THE SUBMISSIONS OF THE ASSESSEE THAT SEIZED DOCUMENTS DOES NOT BELONG TO HIM . 11. THAT LD. CIT(A) HAS ERRED IN CONSEQUENT L Y CONFIRMING THAT ASSESSEE WAS A TRA DER IN SCRAP WITHOUT HAVING ANY THING IN HIS HANDS SUGGESTING THE SAME. RATHER, ASSESSEE WAS BROKER OF IRON & STEEL, WHICH CONTENTION WAS SUPPORTED BY SURROUNDING FACTS AND EVIDENCES FOUND. 12. THAT LD. CIT(A) HAS ERRED IN CONSEQUENT L Y CONFIRMING ADDITION BOTH OF INCOME AS WEL L AS APPLICATION T H EREOF. 13. THAT LD. CIT(A) HAS ERRED IN CONSEQUENT L Y CONFIRMING THAT NO ASSETS WERE FOUND DURING THE COURSE OF ENTIRE SEARCH AND SEIZURE OPERATIONS SUGGESTING THAT ASSESSEE WAS EARNING THAT MUCH INCOME. 14. THAT IMPUGNED APPEAL ORDER AS WELL AS ASSESSMENT ORDER IS BAD IN LAW AS WELL AS ON FACTS AND APPROPRIATE RELIEF DESERVES TO BE ALLOWED TO THE ASSESSEE. 3 15. THAT THE ASSESSEE CRAVES HIS RIGHT TO ADD, WITHDRAW OR MODIFY ANY GROUND OF APPEAL WITH THE PERMISSION OF YOUR HONOUR. 3. IT W AS SUBMITTED BY LEARNED A.R. OF THE ASSESSEE THAT ADDITION WAS MADE IN THE HANDS OF THE ASSESSEE ON PROTECTIVE BASIS AND SUBSTANTIVE ADDITION WAS MADE IN THE HANDS OF THE ASSESSEES BROTHER SHRI NAVEEN KUMAR AGARWAL. HE ALSO SUBMITTED THAT THE ASSESSEES BROTHER HAS OFFERED THIS INCOME BEFORE THE SETTLEMENT COMMISSION AND HAS PAID TAX THEREON AND THEREFORE, THE ADDITION MADE IN THE HANDS OF THE ASSESSEE ON PROTECTIVE BASIS SHOULD BE DELETED. AT THIS JUNCTURE , IT WAS POINTED OUT BY THE BENCH THAT WITHOUT VERIFYING THE VERACITY OF THE CONTENTION THAT ENTIRE INCOME WHICH HAS BEEN ADDED IN THE HANDS OF THE ASSESSEE ON PROTECTIVE BASIS AND IN THE HANDS OF THE ASSESSEES BROTHER ON SUBSTANTIVE BASIS HAS BEEN COVERED IN THE DISCLOSURE MADE BY SHRI NAVEEN KUMAR AGARWAL BEFORE SETTLEMENT COMMISSION, THE ADDITION MADE IN THE PRESENT CASE CAN NOT BE DELETED BUT THE MATTER MAY BE RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR FRESH DECISION AFTER EXAMINING THIS ASPECT AS TO WHETHER ALL THE INCOME ARE COVERED IN DISCLOSURE BEFORE THE SETTLEMENT COMMISSION BY BROTHER OF THE ASSESSEE AND IF TH E ASSESSEE IS ABLE TO ESTABLISH THIS , THEN OBVIOUSLY NO ADDITION CAN BE MADE IN THE HANDS OF THE ASSESSEE. IN REPLY, IT WAS SUBMITTED BY LEARNED A.R. OF THE ASSESSEE THAT THE MATTER MAY BE RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR FRESH DECISION. 4. ON THE OTHER HAND, LEARNED D.R. OF THE REVENUE SUPPORTED THE ORDER OF LEARNED CIT(A). 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT IT IS NOTED BY LEARNED C IT(A) THAT IT IS NOT THE ASSESSEE BUT HIS BROTHER WHO HAS GONE TO SETTLEMENT COMMISSION BUT NO FINDING IS GIVEN BY HIM AS TO WHETHER THE ENTIRE INCOME FOR WHICH ADDITION WAS MADE IN THE HANDS OF THE ASSESSEE ON PROTECTIVE BASIS HAS BEEN INCLUDED IN THE DIS CLOSURE MADE BY THE BROTHER OF 4 THE ASSESSEE BEFORE SETTLEMENT COMMISSION. THIS FACT IS VERY CRUCIAL BECAUSE SUBSTANTIVE ADDITION WAS MADE IN THE HANDS OF THE ASSESSEES BROTHER. UNDER THESE FACTS, WE FEEL IT PROPER THAT THIS MATTER SHOULD GO TO THE FILE OF THE ASSESSING OFFICER FOR FRESH DECISION. HENCE, WE SET ASIDE THE ORDER OF CIT(A) AND RESTORE THE ENTIRE MATTER BACK TO THE FILE OF ASSESSING OFFICER WITH THE DIRECTION THAT THE ASSESSEE SHOULD BRING EVIDENCE ON RECORD IN SUPPORT OF HIS CONTENTION THAT THE ENTIRE INCOME FOR WHICH ADDITION WAS MADE IN THE HANDS OF THE ASSESSEE ON PROTECTIVE BASIS HAS BEEN COVERED IN DISCLOSURE BEFORE THE SETTLEMENT COMMISSION BY THE BROTHER OF THE ASSESSEE SHRI NAVEEN KUMAR AGARWAL AND IF THE ASSESSEE IS ABLE TO ESTABLIS H THIS , THEN NO ADDITION CAN BE MADE IN THE HANDS OF THE ASSESSEE BUT IF NO SUCH INCOME WAS COVERED IN SUCH DISCLOSURE BEFORE SETTLEMENT COMMISSION OR IF ONLY PART INCOME WAS SO COVERED, THEN OBVIOUSLY THE REMAINING INCOME CAN BE ADDED IN THE HANDS OF THE ASSESSEE IF THE ASSESSEE IS NOT BEEN ABLE TO MAKE OUT A CASE FOR NO ADDITION IN HIS HANDS. NEEDLESS TO SAY, THE ASSESSING OFFICER SHOULD PASS NECESSARY ORDER AS PER LAW AFTER PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 6. IN THE RESUL T, THE APPEAL OF THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 2 2 /08/2014. *C.L.SINGH COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. CONCERNED CIT 4. THE CIT(A) 5. D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR