Chhatrachhaya Nirman (P) Ltd. , Indore V. Assistant Commissioner of Income Tax Circle 2 (1), Indore

ITA 508/Ind/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 8253 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 7 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2012-2013
• Appeal Filed On: 01-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PUNIT KUMAR
• Assessee Lawyers: PRITI PATWA; MANISH VAID
• Keywords: Unexplained cash credit; Opportunity of being heard; Principle of natural justice; Opportunity of cross examination; Additional evidence; Accommodation entries; Set aside
• Section: 143(3); 13; 68

Judgement Text

[ITA NO.508/IND/2018] [M/S. CHHATRACHHAYA NIRMAN PVT. LTD., INDORE] , , IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO.508/IND/2018 ASSESSMENT YEAR: 2012-13 M/S. CHHATRACHHAYA NIRMAN PVT. LTD. 28/2, JANKI NAGAR EXTENSION INDORE / VS. ACIT - 2(1) INDORE ( APPELLANT ) ( REVENUE ) P.A. NO. AAACC7055L APPELLANT BY SHRI MANISH VAID, A.R. & SHRI PRITI PATWA, A.R. RESPONDENT BY SHRI PUNIT KUMAR, SR. D.R. DATE OF HEARING: 21.01.2020 DATE OF PRONOUNCEMENT: 23.01.2020 / O R D E R PER KUL BHARAT, J.M: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST ORDER O F THE CIT(A)-1, INDORE DATED 20.3.2018 PERTAINING TO T HE [ITA NO.508/IND/2018] [M/S. CHHATRACHHAYA NIRMAN PVT. LTD., INDORE] 2 ASSESSMENT YEAR 2012-13. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. THAT THE LD. CIT(A) ERRED IN UPHOLDING THE ADDITION MADE BY THE A.O. OF RS.15,00,000/- U/S 68 AS UNEXPLAINED CASH CREDIT AND INTEREST THEREON OF RS.63,123/-. THAT ON THE FACTS AND IN T HE CIRCUMSTANCES OF THE CASE AND IN LAW, THE SAID ADDITION BEING WRO NG, UNCALLED FOR AND UNJUSTIFIED, IT IS PRAYED THAT THE ADDITION U/S 68 OF RS.15,00,000/- AND INTEREST THEREON OF RS.63,123/- MAY VERY KINDLY BE DELETED AND THE ORDER OF THE LD. CIT(A) MAY VERY KINDLY BE QUASHED. 2. THAT THE LD. CIT(A) ERRED IN UPHOLDING THE ADDITION OF RS.15,00,000/- WITHOUT TAKING INTO CONSIDERATION TH E SUBMISSIONS AND THE EVIDENCES FILED BEFORE HIM. THAT ON THE FA CTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE UPHOLDING OF SAID ADDITION OF RS.15,00,000/- AND THE INTEREST THEREON OF RS.63 ,123/- IS BAD IN LAW. 3. THAT THE LD. CIT(A) ERRED IN NOT CONSIDERING THE FA CT THAT THE A.O. HAD COLLECTED AND USED CERTAIN MATERIAL BEHIND THE BACK OF THE ASSESSEE WITHOUT SUPPLYING THE SAME TO THE ASSESSEE AND NEITHER GIVING AN OPPORTUNITY OF BEING HEARD NOR PROVIDING AN OPPORTUNITY OF CROSS EXAMINATION TO THE ASSESSEE WHICH IS AGAINST THE PRINCIPLES OF NATURAL JUSTICE. 4. THAT THE APPELLANT CRAVES LEAVE TO ADD, TO ALTER, A MEND, MODIFY, SUBSTITUTE, DELETE AND/OR RESCIND ALL OR ANY OF THE GROUNDS OF APPEAL ON OR BEFORE FINAL HEARING, IF NECESSITY SO ARISES. 2. THE ONLY EFFECTIVE GROUND IS AGAINST SUSTAINING ADDITION OF RS.15 LAKHS AND INTEREST THEREOF OF RS.63 ,123/- THE FACTS IN BRIEF ARE THAT THE ASSESSEE HAD FILED HIS R ETURN THROUGH ELECTRONIC MEDIA ON 21.9.2012 DECLARING TOTAL INCOME OF RS.48,96,104/-. THE CASE WAS SELECTED FOR [ITA NO.508/IND/2018] [M/S. CHHATRACHHAYA NIRMAN PVT. LTD., INDORE] 3 SCRUTINY ASSESSMENT AND THEREAFTER THE ASSESSMENT U/S 143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER CALLE D AS THE ACT) WAS FRAMED. THEREBY, THE A.O. MADE ADDITION OF RS.15,63,123/- IN THE INCOME DISCLOSED BY THE ASSESS EE. THE BASIS OF MAKING SUCH ADDITION WAS THAT THE A.O. OBSERVED THAT THE ASSESSEE HAD TAKEN UNSECURED LOAN OF RS.15 LAKHS FROM M/S. JAYANT SECURITIES AND FINANCE LTD ., VADODARA TREATING THE SAME AS EXPLAINED IN GENUINE TRANSACTION. THE A.O. ALSO MADE ADDITION OF RS.63,123/- BEING THE INTEREST EXPENSES ON ACCOUNT OF DISALLOWANCE OF INTEREST EXPENSES. AGGRIEVED AGAINST THIS, THE ASSESS EE PREFERRED APPEAL BEFORE LD. CIT(A), WHO AFTER CONSIDER ING THE SUBMISSIONS AND MATERIAL PLACED BEFORE HIM DISMISSE D THE APPEAL. NOW THE ASSESSEE IS IN FURTHER APPEAL BEFOR E THIS TRIBUNAL. 3. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE AUTHORITIES BELOW HAVE GROSSLY FAILED TO APPRECIATE THE FACTS. [ITA NO.508/IND/2018] [M/S. CHHATRACHHAYA NIRMAN PVT. LTD., INDORE] 4 HE FURTHER CONTENDED THAT ADVERSE INFORMATION, IF ANY RELATED TO TRANSACTION WAS COLLECTED BY THE A.O. AND ASSESEE WAS NOT GIVEN OPPORTUNITY TO REBUT THE SAME. NO OPPORTUNITY OF CROSS EXAMINATION WAS GRANTED. HE FURTH ER CONTENDED THAT BEFORE LD. CIT(A), ADDITIONAL EVIDENCES WERE FILED IN SUPPORT OF THE CLAIM OF THE ASSESSEE. HOWEV ER, THESE EVIDENCES WERE NOT CONSIDERED, THEREFORE, HE PRAYED THAT MATTER MAY BE RESTORED TO THE A.O. FOR A DECISION AFRESH. 4. LD. D.R. OPPOSED THESE SUBMISSIONS AND SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. LD. D.R. SUBMIT TED THAT THE A.O. HAS GIVEN A CATEGORICAL FINDING THAT M/S. JAYANT SECURITIES AND FINANCE LTD. HAS BEEN INVOLVED IN GIVING BOGUS ACCOMMODATION ENTRIES. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE LD. CIT(A) HAS DECIDE D THIS ISSUE BY OBSERVING AS UNDER: 4.1.2ON EXAMINATION OF THE FACT, IT WAS FOUND THAT, THIS COMPANY WAS HAVING MERGER/NIL INCOME AND NOT DOING ANY BUSIN ESS ACTIVITY BUT ONLY ENGAGED IN GIVING ACCOMODATION ENTRIES.THE APPELLANT HAD SHOWN TOTAL RECEIPT OF RS.15,00,00/- IN THE GARB OF UNSECURED LOAN FROM THIS ENTITY. SINCE, THE TRANSACTION WITH THIS ENTITY WAS [ITA NO.508/IND/2018] [M/S. CHHATRACHHAYA NIRMAN PVT. LTD., INDORE] 5 [ITA NO.508/IND/2018] [M/S. CHHATRACHHAYA NIRMAN PVT. LTD., INDORE] 6 [ITA NO.508/IND/2018] [M/S. CHHATRACHHAYA NIRMAN PVT. LTD., INDORE] 7 [ITA NO.508/IND/2018] [M/S. CHHATRACHHAYA NIRMAN PVT. LTD., INDORE] 8 [ITA NO.508/IND/2018] [M/S. CHHATRACHHAYA NIRMAN PVT. LTD., INDORE] 9 [ITA NO.508/IND/2018] [M/S. CHHATRACHHAYA NIRMAN PVT. LTD., INDORE] 10 [ITA NO.508/IND/2018] [M/S. CHHATRACHHAYA NIRMAN PVT. LTD., INDORE] 11 [ITA NO.508/IND/2018] [M/S. CHHATRACHHAYA NIRMAN PVT. LTD., INDORE] 12 [ITA NO.508/IND/2018] [M/S. CHHATRACHHAYA NIRMAN PVT. LTD., INDORE] 13 [ITA NO.508/IND/2018] [M/S. CHHATRACHHAYA NIRMAN PVT. LTD., INDORE] 14 6. WE FIND THAT THE A.O. HAS BASED HIS FINDING PURELY ON THE BASIS OF THE FINDINGS OF THE OTHER OFFICERS AND T HE MATERIAL GATH4ERED AT THE BACK OF THE ASSESSEE. IN OUR CONSIDERED VIEW, THE ASSESSEE SHOULD HAVE BEEN CONFRO NTED WITH THE MATERIAL SO GATHERED AND THE ASSESSEE WAS OUGHT TO HAVE BEEN GIVEN OPPORTUNITY TO CROSS EXAMINATION. CONSIDERING THESE FACTS, THE IMPUGNED ASSESSMENT ORDE R IS SET ASIDE TO THE FILE OF THE A.O. TO BE DECIDED AFRES H. THE A.O. WOULD VERIFY THE CLAIM OF THE ASSESSEE, WHICH HE HAD FILED IN THE FORM OF ADDITIONAL EVIDENCES BEFORE LD. CIT(A) [ITA NO.508/IND/2018] [M/S. CHHATRACHHAYA NIRMAN PVT. LTD., INDORE] 15 AND WOULD ALSO MAKE INDEPENDENT ENQUIRIES, IF HE SO DEE M FIT WHILE FRAMING THE ASSESSMENT AFRESH. THE GROUNDS RAISED IN THE APPEAL ARE ALLOWED FOR STATISTICAL PURPOSES. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 23 . 01.2020. SD/ - (MANISH BORAD) SD/ - (KUL BHARAT) A CCOUNTANT MEMBER JUDICIAL MEMBER INDORE; DATED : 23/01/2020 VG/SPS COPY TO: ASSESSEE/AO/PR. CIT/ CIT (A)/ITAT (DR)/GUAR D FILE. BY ORDER ASSISTANT REGISTRAR, INDORE