Dhirajlal Velji Shah, JAMNAGAR V. The Assistant Commissioner of Income Tax, JAMNAGAR

ITA 454/RJT/2011

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 67260 (ITAT-RAJKOT)
• Duration Of Justice: 1 year(s) 5 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-05-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 27-05-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 21-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K C MATHEWS DR L C
• Assessee Lawyers: G B PARIKH AR L
• Keywords: Principle of natural justice

Judgement Text

C , IN THE INCOME TAX APPELLATE TRIBU N AL; RAJKOT BENCH, RAJKOT. BEFORE SHRI T. K. SHARMA, JM AND SHRI D. K. SRIVASTAVA, AM IT A NO . 454 / RJT/20 11 O O / ASSESSMENT YEAR S 20 0 7 - 0 8 SHRI DHIRAJLAL VELJI SHAH, 10 1, VARDHMAN APPT., 80FT ROAD, MEHUL NAGAR, B/H. JAIN DERASAR, JAMNAGAR 361 006 PAN : ABNPS 0122 R ( 6 / APPELLANT) VS. ACIT, CIRCLE - 1, JAMNAGAR 'C6 / RESPONDENT O\L / ASSESSEE BY SHRI G B PARIKH, AR L / REV ENUE BY SHRI K C MATHEWS, DR L C /DATE OF HEARING 27 . 05 .2013 L C / DATE OF PRONOUNCEMENT 30 . 05 . 2013 / ORDER . . [ , / T. K. SHARMA, J. M . : THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE ORDER DATE D 29.09.2011 OF LD CIT (A), JAMNAGAR FOR THE ASSESSMENT YEAR 2007 - 08. 2 . BRIEFLY STATED FACTS ARE THAT ASSESSEE IS AN INDIVIDUAL. FOR THE ASSESSMENT YEAR UNDER APPEAL HE FILED HIS RETURN OF INCOME ON 31.03.2008 DECLARING TOTAL INCOME OF RS.10,03,207/ - WH ICH INTER ALIA INCLUDED THE RENTAL INCOME OF SEVEN PROPERTIES DECLARED AT RS. 19 , 092/ - . THE ASSESSING O FFICER FRAMED ASSESSMENT U/S 143 (3) ON 16.12.2009 WHEREIN HE COMPUTED THE RENTAL INCOME FROM THE HOUSE PROPERTIES AT RS.2,19,376/ - . IN THE ASSESSMENT OR DER, THE ASSESSING OFFICER OBSERVED THAT THERE ARE SEVEN HOUSES IN JAMNAGAR IN THE NAME OF THE ASSESSEE AND HIS MINOR DAUGHTER. THE ASSESSEE HAS THREE FLATS AS SELF OCCUPIED VIZ FLAT NOS. 101, 103 & 104. THE ASSESSING OFFICER FURTHER OBSERVED THAT HOW TH E ASSESSEE HAS TREATED THE TWO HOUSES OF MINOR DAUGHTER AS SOP AND ONE OWN HOUSE AS SOP. THE ASSESSING OFFICER DEPUTED WARD INSPECTOR TO CAUSE INQUIRIES ABOUT THE FAIR RENT OR MARKET RENT OF THE PROPERTIES IN THE LOCALITIES. THE WARD INSPECTOR SUBMITTED H IS REPORT DATED 25.12.2009 , ON THE BASIS OF WHICH THE ASSESSING OFFICER COMPUTED THE INCOME FROM HOUSE ITA NO. 454/RJT/2011 2 PROPERTIES AT RS.2,19,376/ - . ON APPEAL, IN THE IMPUGNED ORDER, THE LD CIT(A) UPHELD THE ACTION OF THE ASSESSING OFFICER COMPUTING THE INCOME UNDER THE HEAD OF HOUSE PROPERTY AT RS.2,19,376/ - . AGGRIEVED BY THE ORDER OF LD CIT(A) ON THIS ISSUE, THE ASSESSEE IS NOW IN APPEAL BEFORE THIS TRIBUNAL ON THE FOLLOWING GROUNDS: - 1. THAT THE LEARNED CIT(A), JAMNAGAR OUGHT TO HAVE HELD THAT ASSESSING OFFICER H AS PASSED THE ASSESSMENT ORDER WITHOUT GIVING ANY SHOW CAUSE NOTICE REGARDING ADDITION SOUGHT TO BE MADE TO THE TOTAL INCOME OR SUPPLYING THE COPY EVIDENCES BEING SO CALLED INSPECTORS REPORT ON WHICH HE PROPOSE TO BASE HIS JUDGMENT IS AGAINST THE RULES OF NATURAL JUSTICE AND EQUITY, HENCE ASSESSMENT ORDER PASSED BY HIM IS HAS - IN - LAW AND VOID AB - INTIO ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 2. THAT THE LEARNED CIT(A), JAMNAGAR ERRED AND WAS NOT JUSTIFIED IN SUSTAINING THE ADDITION OF RS.2,00,284 OUT O F TOTAL ADDITION MADE OF RS.2,19,376 BY THE ASSESSING OFFICER, TO TOTAL INCOME UNDER THE HEAD OF INCOME HOUSE PROPERTY ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. THAT THE APPELLANT CRAVES LEAVE TO AND/OR TO AMEND AND/OR TO ALTER TO AND/OR TO SUBSTITUT E TO ALL OR ANY OF THE GROUNDS OF APPEAL UPTO THE HEARING OF APPEAL. 3. AT THE TIME OF HEARING, ON BEHALF OF THE ASSESSEE SHRI G B PARIKH APPEARED AND CONTENTED THAT THE ASSESSING OFFICER, WITHOUT GIVING ANY SHOW - CAUSE NOTICE, MADE AN ADDITION TO THE IN COME DECLARED UNDER THE HEAD OF HOUSE PROPERTY; THAT TOO WITHOUT SUPPLYING THE COPY OF THE EVIDENCE I.E. THE SO - CALLED INSPECTOR REPORT ON WHICH HE PROPOSED THE BASE JUDGMENT. HE ACCORDINGLY CONTENTED THAT IN THE INTEREST OF JUSTICE, THE MATTER BE REMI TTED TO THE FILE OF THE ASSESSING OFFICER WITH THE DIRECTION TO SUPPLY THE INSPECTOR REPORT AND OTHER EVIDENCES WHICH HE RELIED ON FOR COMPUTING THE INCOME FROM THE HOUSE PROPERTY AND AFTER OBTAINING THE OBJECTION OF THE ASSESSEE THEREON HE COULD COMPUTE T HE INCOME IN ACCORDANCE WITH THE PROVISION CONTAINED IN SECTION 23 TO 2 7 OF THE I.T. ACT, 1961. AS AGAINST THIS, THE LD DEPARTMENTAL REPRESENTATIVE VEHEMENTLY SUPPORTED THE ORDER PASSED BY THE LD CIT(A). THE LD DEPARTMENTAL REPRESENTATIVE POINTED OUT THA T BEFORE THE LD CIT(A) THE ASSESSEE NEVER RAISED THE AFORESAID OBJECTIONS REGARDING NON - SUPPLY OF THE INSPECTOR S REPORT, THEREFORE THE REQUEST OF THE ASSESSEE TO REMAND THE ISSUE TO THE FILE OF THE ASSESSING OFFICER BE REJECTED. 4. AFTER HEARING BOTH T HE SIDES, WE HAVE CAREFULLY GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. IT IS PERTINENT TO NOTE THAT THE ASSESSEE DECLARED THE INCOME ITA NO. 454/RJT/2011 3 FROM SEVEN HOUSE PROPERT IES AT RS.19,092/ - AS AGAINST THIS THE ASSESSING OFFICER COMPUTE D THE SAME AT RS.2,19,376/ - . FOR COMPUTING THE INCOME UNDER THE HEAD HOUSE PROPERTY , THE ASSESSING OFFICER HAS RELIED ON THE INSPECTORS REPORT DATED 25.12.2009 WHICH WAS NOT MADE AVAILABLE TO THE ASSESSEE. THIS IS AGAINST THE PRINCIPLE OF NATURAL JUSTICE. WE THEREFORE, IN THE INT EREST OF JUSTICE, SET ASIDE THE ORDER OF THE LD CIT(A) ON THIS ISSUE AND DIRECT THE ASSESSING OFFICER TO SUPPLY THE INSPECTORS REPORT TO THE ASSESSEE AND THEREAFTER RECOMPUTE THE INCOME UNDER TH IS HEAD AFRESH . WHILE RE - COMPUTING THE INCOME, THE ASSESSI NG OFFICER WILL ALSO GIVE COMPLETE DESCRIPTION OF THE PROPERTIES I.E. ITS AREA, LOCATION NUMBER, THE RENT PAID OF SIMILAR PROPERTY IN THAT AREA , MUNICIPAL VALUATION I.E. ALV ASSESSED BY MUNICIPAL AUTHORITIES AND RECOMPUTE THE INCOME AS PER PROVISION CONTAI NED IN SECTION 22 TO 27 OF THE I.T. ACT, 1961, AFTER CONSIDERING THE OBJECTIONS OF THE ASSESSEE TO THE PROPOSED COMPUTATION. 5. IN THE RESULT, FOR STATISTICAL PURPOSE, THE APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED. THIS ORDER IS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED HEREINABOVE. SD/ - SD/ - ( D. K. SRIVASTAVA ) (T. K. SHARMA) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / ORDER DATE . 05 .2013 . /RAJKOT BT T JO O / COPY OF ORDER FORWARDED TO: - 1 . 6 / APPELLANT - SHRI DHIRAJLAL VELJI SHAH, 101, V ARDHMAN APPT., 80FT ROAD, MEHUL NAGAR, B/H. JAIN DERASAR, JAMNAGAR 2 . 'C6 / RESPONDENT - ACIT, CIRCLE - 1, JAMNAGAR 3 . E / CONCERNED CIT JAMNAGAR 4 . E - / CIT (A) , JAMNAGAR 5 . ' , C , / DR, ITAT, RAJKOT 6 . O / GUARD FILE. / BY ORDER , TRUE COPY PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL, RAJKOT