Ramesh Chander Kapoor & Sons (HUF), New Delhi V. ITO, New Delhi

ITA 4940/DEL/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 58449 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-01-2012
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: F
• Next Hearing Date: 10-01-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 08-11-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ANUSHA KHURANA
• Assessee Lawyers: R K MEHRA
• Keywords: Income from undisclosed sources; Non compliance
• Section: 234B; 69; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI F BEN CH BEFORE SHRI U.B.S. BEDI, JM & SHRI A.N. PAHUJA, AM ITA NO.4940/D/2011 ASSESSMENT YEAR: 2005-06 RAMESH CHANDER KAPOOR & SONS (HUF), 18, ALLIED HOUSE, ZAMRUDPUR COMMERCIAL COMPLEX, KAILASH COLONY EXTENSION.,NEW DELHI V/S . INCOME TAX OFFICER, WARD 28 (3), NEW DELHI [PAN: AAAHR 7597 D] (APPELLANT) (RESPONDENT) ASSESSEE BY SHRI R.K. MEHRA, AR REVENUE BY SMT. ANUSHA KHURANA, SR. DR DATE OF HEARING 10-01-2012 DATE OF PRONOUNCEMENT 10-01-2012 O R D E R A.N.PAHUJA:- THIS APPEAL FILED ON 08.11.2011 BY THE ASSESSEE A GAINST AN ORDER DATED 30 TH SEPTEMBER, 2011 OF THE LEARNED CIT(A)-XXV, NEW DEL HI, RAISES THE FOLLOWING GROUNDS:- 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE APPELLANTS CASE, THE LEARNED CIT(A)-XXV, NEW DELHI, ERRED IN L AW AND ON FACTS IN PASSING EX-PARTE ORDERS. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E APPELLANTS CASE, THE LEARNED CIT(A)-XXV, NEW DELHI, ERRED IN L AW AND ON FACTS IN UPHOLDING THE ORDER OF THE LEARNED ASSE SSING OFFICER MADE U/S 144 OF ACT IN SPITE OF THE FACT TH AT THE REPRESENTATIVE OF THE ASSESSEE BROUGHT ALL THE FACT S RELATING TO ALL THE ISSUES TO THE NOTICE OF THE LEARNED ASSE SSING OFFICER WHENEVER HE PRESENTED HIMSELF ON THE APPOIN TED DATES, EVEN THE NECESSARY DOCUMENTS WERE ALSO FILED WITH HIM. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E APPELLANTS CASE, THE LEARNED CIT(A)-XXV, NEW DELHI, ERRED IN L AW AND ON FACTS IN UPHOLDING THE ORDER OF THE LEARNED INCO ME-TAX OFFICER IN COMPUTING THE TOTAL INCOME AT ` `437600 BY WRONGLY I.T.A. NO.4940/D/2011 2 TREATING IT AS INCOME FROM UNDISCLOSED SOURCES CHAR GEABLE TO TAX U/S 69 OF THE INCOME-TAX ACT, 1961. 4. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E PETITIONERS CASE, THE LEARNED INCOME TAX OFFICER ERRED IN LAW I N CHARGING INTEREST U/S 234A AMOUNTING TO ` `31,141/-. 5. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E PETITIONERS CASE, THE LEARNED INCOME TAX OFFICER ERRED IN LAW I N CHARGING INTEREST U/S 234B AMOUNTING TO ` ` 35437/-. 6. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E PETITIONERS CASE, THE LEARNED INCOME TAX OFFICER ERRED IN LAW I N CHARGING INTEREST U/S 234C AMOUNTING TO ` ` 3971/-. 2. ADVERTING FIRST TO GROUND NOS.2 & 3 IN THE APPE AL, FACTS, IN BRIEF, AS PER RELEVANT ORDERS ARE THAT ON THE BASIS OF INFOR MATION IN THE AIR RECEIVED FROM THE CIT-CIB THAT THE ASSESSEE INVESTED AN AMOUNT OF ` ` 4,37,600/- ON 20 TH NOVEMBER, 2004 IN THE UTI MUTUAL FUND, A NOTICE U/S 142(1)(I) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) WAS ISSUED ON 06.11.2007. NONE RESPONDED TO THIS NOTICE NOR TO THE SUBSEQUENT NOTI CE ISSUED ON 13 TH DECEMBER, 2007. ACCORDINGLY, THE ASSESSING OFFICER (A.O. IN SHORT) COMPLETED THE BEST JUDGMENT ASSESSMENT U/S 144 OF THE ACT WITH THE ADD ITION OF ` ` 4,37,600/- U/S 69 OF THE ACT. 3. ON APPEAL, NONE APPEARED ON BEHALF OF THE ASSES SEE BEFORE THE LD. CIT(A). ACCORDINGLY, THE LEARNED CIT(A) UPHELD THE FINDINGS OF THE AO IN THE FOLLOWING TERMS:- 3.3 I HAVE CONSIDERED THE ORDER OF THE ASSESSING O FFICER AND/ THE SUBMISSION OF THE ASSESSEE AND I DO NOT FIND ANY ME RIT IN THE SUBMISSION OF THE ASSESSEE. THE ASSESSING OFFICER HAD ISSUED REPEATED NOTICES TO THE ASSESSING OFFICER IN THE CO RRECT ADDRESS OF THE ASSESSEE BUT THE ASSESSEE HAS FAILED TO COMPLY WITH THE NOTICES. IT HAS NOT BEEN EXPLAINED FOR THE NON-COM PLIANCE OF THE NOTICES. DURING THE COURSE OF APPELLATE PROCEEDING S ALSO THERE HAS BEEN REPEATED NON COMPLIANCE FOR THE NOTICES ISSUED TO THE ASSESSEE AND THE ASSESSEE HAS FAILED TO AVAIL OF TH E OPPORTUNITY TO I.T.A. NO.4940/D/2011 3 REPRESENT THE CASE. THE ASSESSEE HAS ALSO NOT SUBM ITTED ANY EXPLANATION REGARDING THE SOURCE OF INVESTMENT OF ` `4,37,600/- IN THE UTI MUTUAL FUND. SO FAR AS THE JURISDICTION OF THE ASSESSING OFFICER IS CONCERNED, IT MAY BE MENTIONED THAT THE ASSESSING OFFICER HAS BEEN GIVEN THE ADDITIONAL JURISDICTION BY THE CCIT, DELHI AND HAS BEEN DESIGNATED AS DAO-66, NEW DELHI AND AC CORDINGLY, I DO NOT FIND ANY MERIT IN THE SUBMISSION OF THE ASSE SSEE AND AS SUCH THE ASSESSING OFFICER HAS CORRECTLY ASSUMED TH E JURISDICTION. 3.4 AFTER CONSIDERING ALL THE FACTS AND CIRCUMSTANC ES OF THE CASE, I AM OF THE VIEW THAT THE ASSESSEE HAS NO EXPLANATI ON REGARDING THE SOURCE OF INVESTMENT IN THE UTI MUTUAL FUND AND THE ASSESSEE HAS FAILED TO CONTROVERT THE FINDING OF THE ASSESSING O FFICER AND ACCORDINGLY, SINCE THE ASSESSEE HAS NOT SUBMITTED A NY EXPLANATION IN THIS REGARD AS SUCH THE ACTION OF THE ASSESSING OFFICER IN PASSING THE EX-PARTE ORDER U/S 144 AND THE ADDITION OF ` `4,37,600/- IS CONFIRMED. 4. THE ASSESSEE IS NOW IN APPEAL BEFORE US AGAINST THE AFORESAID FINDINGS OF THE LD. CIT(A). AT THE OUTSET, THE LD. AR ON BEHALF OF THE ASSESSEE WHILE INVITING OUR ATTENTION TO DOCUMENTS PLACED IN THE PAPER BOOK SUBMITTED THAT THE INVESTMENT IN UTI MUTUAL FUND WAS MADE IN 1999 UNDER MIP-99 SCHEME OF THE UNIT TRUST OF INDIA AND THUS, THE LEARNED CIT(A ) WAS NOT JUSTIFIED IN UPHOLDING THE ADDITION. ON THE OTHER HAND, THE LD. DR POINTED OUT THAT AS IS APPARENT FROM THE ASSESSMENT ORDER, THE ASSESSEE DID NOT APPEAR B EFORE THE AO NOR THERE IS ANYTHING TO SUGGEST THAT THE DOCUMENTS PLACED IN THE PAPER BOOK WERE FILED BEFORE THE AO. THUS, THESE DOCUMENTS REQUIRE VERIFI CATION. 5. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE FACTS OF THE CASE. AS REGARDS GROUND NO.2 RELATING TO COMPLETION OF AS SESSMENT U/S 144 OF THE ACT, INDISPUTABLY, THE ASSESSEE DID NOT APPEAR BEFORE TH E AO ON 20.11.2007 OR ON 18.12.2007 NOR FILED ANY RETURN OF INCOME. HOWEVER , IT IS MENTIONED IN THE STATEMENT OF FACTS FILED ALONG WITH THE APPEAL BEFO RE THE LD. CIT(A) THAT THE ASSESSEE WAS ASSESSED WITH AO- CIRCLE 23(1) IN THE PRECEDING YEARS AND IT IS ONLY FOR THE YEAR UNDER CONSIDERATION THAT ASSESSME NT HAS BEEN COMPLETED BY I.T.O. WARD-28(3). THE ASSESSEE IS STATED TO HAVE FILED RETURN FOR THE YEAR UNDER CONSIDERATION ON 17 TH MARCH,2006 WITH AO-CIRCLE-23(1).THE LD. CIT(A) FOU ND THAT I.T.A. NO.4940/D/2011 4 THE AO HAD BEEN GIVEN ADDITIONAL JURISDICTION AND THUS, JURISDICTION WAS CORRECTLY ASSUMED. TO A QUERY BY THE BENCH, THE LD. AR ADMI TTED THAT THE CONCURRENT JURISDICTION VESTED IN BOTH THE AUTHORITIES. IN THE SE CIRCUMSTANCES, ESPECIALLY WHEN THE LD. AR DID NOT ADDUCE ANY REASONS FOR NOT RESPONDING TO THE NOTICES ISSUED BY THE AO NOR EVEN FOR NOT APPEARING BEFORE THE LD. CIT(A) DURING THE HEARINGS FIXED FOR 3 RD JULY, 2008, 14 TH AUGUST, 2008, 2 ND SEPTEMBER, 2008 AND 13.09.2011, WE ARE OF THE OPINION THAT THE LD. CIT (A) WAS JUSTIFIED IN UPHOLDING THE ACTION OF THE AO IN COMPLETING THE ASSESSMENT U/S 144 OF THE ACT. THEREFORE, GROUND NO.2 IN THE APPEAL IS DISMISSED. 5.1 AS REGARDS CONTENTION OF THE LD. AR THAT IN VESTMENT IN UTI MUTUAL FUND WAS MADE IN 1999, APPARENTLY, THE LOWER AUTHORITIES D ID NOT HAVE ANY OCCASION TO VERIFY THE SOURCE OR YEAR OF INVESTMENT IN THE AFO RESAID MUTUAL FUND, DUE TO NON- COMPLIANCE OF VARIOUS NOTICES ISSUED BY THE AO OR T HE LD. CIT(A). SINCE INVESTMENT IS STATED TO BE MADE UNDER MIP 1999 SCHE ME OF THE UTI, IN THE INTEREST OF JUSTICE, WE CONSIDER IT FAIR AND APPROP RIATE TO VACATE THE FINDINGS OF THE LD. CIT(A) AND RESTORE THE MATTER TO THE FILE OF AO WITH THE DIRECTIONS TO ALLOW A FINAL OPPORTUNITY TO THE ASSESSEE TO ESTABLISH THE SOURCE OF INVESTMENT OF ` 4,37,600/- IN UTI MUTUAL FUND ON 20.11.2004, AS R EVEALED FROM THE AIR AND THEREAFTER, PASS APPROPRIATE ORDERS IN ACCORDANCE W ITH LAW .THE ASSESSEE SHALL PLACE ALL THE RELEVANT EVIDENCE IN HIS POSSESSION REGARDING THIS INVESTMENT AND CO-OPERATE IN EXPEDITIOUS COMPLETION OF ASSESSMENT .THE AO IS ALSO FREE TO UNDERTAKE ANY INDEPENDENT ENQUIRIES, IF FOUND NECES SARY. WITH THESE DIRECTIONS, GROUND NO. 3 IN THE APPEAL IS DISPOSED OF. 6. GROUND NOS. 4 TO 6 IN THE APPEAL RELATE TO LEV Y OF INTEREST U/S 234A, 234B AND 234C OF THE ACT. SINCE THE LD. AR DID NOT MAKE ANY SUBMISSIONS BEFORE US ON THESE GROUNDS WHILE GROUND NO.3 RELATING TO SUBSTAN TIVE ADDITION HAS BEEN RESTORED TO THE FILE OF THE AO, THESE GROUNDS BE ING CONSEQUENTIAL, DO NOT SURVIVE FOR OUR ADJUDICATION AT THIS STAGE. THE AO SHALL ALLOW CONSEQUENTIAL RELIEF, IF ANY ,ON GIVING EFFECT TO OUR AFORESAID OBSERVATI ONS IN RELATION TO GROUND NO.3. I.T.A. NO.4940/D/2011 5 7. GROUND NO.1 IN THE APPEAL BEING GENERAL IN NATU RE NOR ANY SUBMISSIONS HAVING BEEN MADE BEFORE US ON THIS GROU ND, DOES NOT REQUIRE ANY SEPARATE ADJUDICATION AND IS ,THEREFORE, DISMISSED. 8. NO OTHER SUBMISSION OR ARGUMENT WAS MADE BEFORE US. 9. IN THE RESULT, APPEAL IS PARTLY ALLOWED BUT FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT SD/- SD/- (U.B. S. BEDI) (A.N. PAH UJA) JUDICIAL MEMBER ACCOUNTANT MEMBER NS COPY OF THE ORDER FORWARDED TO :- 1. RAMESH CHANDER KAPOOR & SONS (HUF), 18, ALLIED HOUSE, ZAMRUDPUR COMMERCIAL COMPLEX, KAILASH COLONY EXTN., NEW DELHI 2. INCOME TAX OFFICER, WARD 28 (3), NEW DELHI. 3. CIT (APPEALS)-XXV, NEW DELHI 4. THE CIT CONCERNED. 5. THE DR, ITAT,F BENCH, NEW DELHI 6. GUARD FILE. BY ORDER, DEPUTY / ASSTT.REGISTRAR ITAT, DELHI