Madhu Chugh, Panipat V. ITO WARD - 2, PANIPAT

ITA 494/DEL/2021

AI Insights

The case involves Smt. Madhu Chugh, who appealed against the reassessment order passed by the Income Tax Officer, Ward 2, Panipat, which was confirmed by the CIT (Appeals), Karnal. The primary contention was the legality of the reassessment under sections 147 and 143(3) of the Income Tax Act, 1961, and the addition of Rs. 4,00,00,000 as unexplained income under section 68. The assessee argued that the statutory conditions for reopening the assessment were not met and that the reassessment was based on incorrect facts and findings, violating principles of natural justice. The Tribunal found merit in the assessee's request for a re-examination of the documents related to the unsecured loan from M/s Tejasavi Vinimay (P.) Ltd., which had been allegedly refunded.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 112837 (ITAT-DELHI)
• Duration Of Justice: 7 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-12-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: E
• Next Hearing Date: 04-12-2022
• Assessment Year: misc
• Appeal Filed On: 04-05-2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: RAKESH GUPTA
• Keywords: Principle of natural justice; Reason to believe
• Section: 147; 68; 234B; 143(2)

Judgement Text

1 ITA. 494/Del/2021 Smt. Madhu Chugh, Panipat IN THE INCOME TAX APPELLATE TRIBUNAL [ DELHI BENCH : “E” NEW DELHI ] BEFORE DR. B. R. R. KUMAR, ACCOUNTANT MEMBER AND SHRI YOGESH KUMAR U.S., JUDICIAL MEMBER I.T.A. No. 494/DEL/2021 (A.Y 2011-12) Smt. Madhu Chugh, C/o. M/s. RRA TAXINDIA, D-28, South Extension, Part-I, New Delhi – 110 049. PAN No. AECPC8596H (APPELLANT) Vs. Income Tax Officer, Ward : 2, Panipat. (RESPONDENT) ORDER PER YOGESH KUMAR U.S., JM This appeal is filed by the assessee against the order of the ld. Commissioner of Income Tax (Appeals) Karnal [hereinafter referred to CIT (Appeals) dated 01.07.2020 for assessment year 2011-12. Assessee by Dr. Rakesh Gupta, Adv.; & Shri Somil Agarwal, Adv. Department by Shri Atiq Ahmad, Sr. D. R.; Date of Hearing 05.12.2022 Date of Pronouncement 13.12.2022 2 ITA. 494/Del/2021 Smt. Madhu Chugh, Panipat 2. The assessee has raised the following substantive grounds of appeal:- “1. That having regard to the facts and circumstances of the case, the assumption of jurisdiction in reopening the impugned assessment and passing the impugned reassessment order u/s 147/143(3), is bad in law and against the facts and circumstances of the case and more so when statutory conditions as stipulated u/s 147 to 151 have not been complied with. 2. That in any case and in any view of the matter, the assumption of jurisdiction in reopening the assessment u/s 147/143(3), is illegal, bad in law and against the facts and circumstances of the case and the same is not sustainable on various legal grounds. 3. That having regard to the facts and circumstances of the case, Ld. CIT (Appeals) ought to have quashed the reassessment order passed by Ld. AO as the statutory notice u/s 143(2) has not been issued/served upon the assessee and that too in accordance with law. 4. That having regard to the facts and circumstances of the case, Ld. CIT (Appeals) has erred in law and on facts in confirming the action of Ld. AO in making aggregate addition of Rs.4,00,00,000/- on account of unsecured loan received from M/s Tejasvi Vinimay (P) Ltd. u/s 68 by treating it as alleged unexplained income of the assessee and that too by recording incorrect facts and findings and without providing the adverse material available on record and without considering/appreciating the submissions of assessee and in violation of principles of natural justice. 3 ITA. 494/Del/2021 Smt. Madhu Chugh, Panipat 5. That in any case and in the view of the matter, action of Ld. CIT (Appeals) in confirming the action of Ld. AO in making aggregate addition of Rs.4,00,00,000/- on account of unsecured loan received from M/s Tejasvi Vinimay (P) Ltd. u/s 68, is bad in law and against the facts and circumstances of the case. 6. That having regard to the facts and circumstances of the case, Ld. CIT (Appeals) has erred in law and on facts in not reversing the action of Ld. AO in charging interest u/s 234A and 234B of Income Tax Act, 1961.” 3. Brief facts of the case are that, the assessee was maintaining bank account with ICICI Bank and on 16/04/2010 the assessee got credit of Rs. 1 crore through online clearing and on the next day same amount was debited through inward clearing. The necessary inquires have been conducted by DDIT (Inv.). The assessee has filed explanation of credit entries recorded in her bank account. The Ld. A.O. was of the opinion that there was sufficient reason to believe that the assessee has not filed the particulars of her income fairly and truly at the time of filing ITR and the assessment order came to be passed on 21/12/2018. The volume of transaction recorded in the bank account of the assessee as well as the returned income of the assessee for Assessment Year 2008-09, 2009-10, 2010-11 and 2011-12 has been considered and discussed. The Ld. A.O. was of the opinionthat the assessee has not discharged her onus to prove the identity and genuineness of the transaction by filing the copy of the ITR of M/s Tejasavi Vinimay (P.) Ltd. and further found that the prima facie the transaction of the assessee are not genuine. Accordingly, the entries recorded in the bank account of the assessee to the extent of Rs. 4 crore found to be unexplained and made an addition of Rs. 4 crore u/s 68 of the Act. 4 ITA. 494/Del/2021 Smt. Madhu Chugh, Panipat 4. Aggrie.ved by the assessment order dated 21/12/2018, the assessee has preferred an appeal before the CIT(A). The Ld.CIT(A) vide order dated 01/07/2020 has dismissed the appeal filed by the assessee. 5. As against the order dated 01/07/2020 passed by the Ld.CIT (A), the assessee has preferred the present appeal on the grounds mentioned above. 6. The case of the assessee before us that the assumption of the jurisdiction in reopening and passing the assessment order u/s 147/143(3) of the Act is bad in law when statutory conditions as stipulated u/s 147 to 151 of the Act have not been complied with. Further the Ld.CIT(A) has erred in confirming the aggregate addition of Rs. 4,00,00,000/- on account of unsecured loan received from M/s Tejasavi Vinimay (P.) Ltd. u/s 68 of the Act by treating it as unexplained income of the assessee and that too by recording incorrect findings and without considering the submissions of the assessee which is in violation of principles of natural justice. The Ld. Counsel for the Assessee submitted that the entire unsecured loan received from M/s Tejasavi Vinimay (P.) Ltd. has been refunded and produced the documents before the Lower Authorities to establish the same, which have not been considered. Therefore, prayed to remand the matter to the A.O. to verify the said facts and pass appropriate order. 7. Per contra, the Ld. DR has relied on the orders of the Lower Authorities and submitted no objection to remand the matter to the A.O. for considering the facts afresh and decide accordingly. 8. We have heard the parties perused the material on record and gave our thoughtful consideration. 5 ITA. 494/Del/2021 Smt. Madhu Chugh, Panipat 9. It is the specific case of the assessee is that the entire amount of Rs. 4,00,00,000/- received from M/s Tejasavi Vinimay (P.) Ltd. was in the nature of unsecured loan which has been refunded, the assessee has produced following documents in the paper book which is reproduced below:- Copy of account of the assessee in the books of M/s Tejasvi Vinimay Pvt. Ltd. as on 31.03.2011 29 Copy of account of the assessee in the books of M/s Tejasvi Vinimay Pvt. Ltd. as on 31.03.2019 30 Copy of bank statement of assessee showing the repayment of Rs. 4,00,00,000/- 31- 34 10. The above Documents have not been considered by the lower Authorities. By considering the above facts, we deem it fit to remand the matter to the file of A.O. to consider the above documents and decide the matter afresh. Accordingly, we partly allow the Ground No.4 for statistical purpose. 11. In the result, the appeal of the assessee is partly allowed for statistical purpose. Order pronounced in the Open Court on : 13.12.2022. Sd/- Sd/- (B. R. R. KUMAR) (YOGESH KUMAR U.S.) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated : 13/12/2022 *R. N, SR. PS* Copy forwarded to : 1. Appellant 2. Respondent 3. CIT 4. CIT (Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI 6 ITA. 494/Del/2021 Smt. Madhu Chugh, Panipat