ITO, Guna V. Smt. Ritu Premy, Guna

ITA 51/AGR/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 7052 (ITAT-AGRA)
• Duration Of Justice: 1 year(s) 1 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-04-2011
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 20-04-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 09-03-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Rejection of books of accounts; Unexplained investment; Depreciation; Principle of natural justice; Assessment record
• Section: 234B; 145; 144; 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, AGRA BEFORE SHRI P.K. BANSAL, ACCOUNTANT MEMBER AND SHRI H.S. SIDHU, JUDICIAL MEMBER ITA NO.51/AGR/2010 ASST. YEAR: 2005-06 INCOME TAX OFFICER, VS. SMT. RITU PREMY, GUNA (M.P.) PROP. M/S. M.B. SALES & SERVICE, VILLAGE KUSHEPUR, DISTT. GUNA (M.P.) (PAN : ANDPP 8890 K). ITA NO.55/AGR/2010 ASST. YEAR: 2005-06 SMT. RITU PREMY, VS. INCOME TAX OFFICER, PROP. M/S. M.B. SALES & SERVICE, GUNA (M.P.) VILLAGE KUSHEPUR, DISTT. GUNA (M.P.) (PAN : ANDPP 8890 K). (APPELLANTS) (RESPONDENTS) REVENUE BY : SHRI VINOD KUMAR, JR. D.R. ASSESSEE BY : NONE ORDER PER H.S. SIDHU, J.M. : THESE CROSS APPEALS HAVE BEEN FILED BY THE REVENUE AND THE ASSESSEE AGAINST THE ORDER DATED 31.12.2009 PASSED BY THE LD. CIT(A) , GWALIOR ON THE FOLLOWING GROUNDS:- 2 2. GROUND IN ITA NO.51/AGR/2010 BY THE REVENUE :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.10,01,808/- ON ACCOUNT OF UNEXPLAINED OPENING CAPITAL U/S.69. 3. GROUNDS IN ITA NO.55/AGR/2010 BY THE ASSESSEE :- 1. THAT THE LEARNED A.O. ERRED IN PASSING EXPARTE ORDER & THUS FAILED IN PROVIDING OPPORTUNITY TO ASSESSEE. 2. THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE LEARNED INCOME TAX OFFICER ERRED IN REJECTING THE BOOK RESU LTS AND APPLYING THE PROVISION OF SECTION 145 OF I.T. ACT. 3. THAT THE LEARNED A.O. GAVE NO FINDING FOR CHARGI NG THE PENAL INTEREST U/S 234B OF I.T. ACT AND THEREFORE ERRED I N CHARGING THE PENAL INTEREST OF RS.141493/-. 4. THAT THE LEARNED A.O. ERRED IN MAKING FOLLOWING ADDITIONS IN THE TOTAL INCOME OF THE APPELLANT. (I) RS.200000/- ADDITION U/S 69 OF I.T. ACT BEING UNEXPLAINED AMOUNT. (II) RS.4500/- ADDITION ON ACCOUNT OF DEPRECIATION OF FURNITURE (III) RS.12500/- ADDITION ON ACCOUNT OF DEPRECIATIO N OF TWO GENERATORS (IV) RS.1001808/- LON AMOUNT RECEIVED FROM HUSBAND ADDED AS UNEXPLAINED INVESTMENT (V) RS.14000/- AMOUNT BEING RECEIVABLE AS LICENSE F EES (VI) RS.2942/- BEING OUTSTANDING LIABILITIES NOT DEPOSITED IN TIME (VII) RS.50000/- LUMP SUM ADHOC ADDITION AS BOOK RE SULT NOT ACCEPTED. 3 5. THAT THE ENTIRE ASSESSMENT ORDER IS BASED ON GUE SS WORK AND SURMISES AND DESERVES TO BE QUASHED. 6. THAT THE ENTIRE ASSESSMENT ORDER IS ILLEGAL AND UNJUSTIFIED. 7. THAT OTHER GROUND SHALL BE RAISED AT THE TIME OF HEARING. 4. THE BRIEF FACTS RELATING TO THE ISSUE IN DISPUTE ARE THAT THE ASSESSEE FILED HER RETURN OF INCOME FOR THE FIRST TIME ON 31 ST OCTOBER, 2005 DECLARING AN INCOME OF RS.91,400/-. SHE HAS ALSO FILED AUDIT REPORT DULY AUDITED BY THE CHARTERED ACCOUNTANT ALONG WITH HER RETURN OF INCOME. THE AS SESSING OFFICER (A.O.) ISSUED NOTICE UNDER SECTION 143(2) OF THE INCOME TAX ACT, 1961 (THE ACT HEREINAFTER) ON 1 ST SEPTEMBER, 2006 FIXING THE DATE OF HEARING ON 26.0 9.2006. THE A.O. ALSO ISSUED QUESTIONNAIRE TO THE ASSESSEE. IN RESPONSE TO THE SAME, THE LD. AUTHORIZED REPRESENTATIVE (A.R.) OF THE ASSESSEE APPEARED AND FILED REPLY ON 17.01.2007 AND THE CASE WAS ADJOURNED FOR 24.01.2007 AND LATER ON, ON VARIOUS TIMES, THE A.O. ADJOURNED THE CASE ON THE REQUEST OF THE ASSESSEE O R ON ONE OR OTHER REASONS MANY TIMES. LASTLY, THE A.O. FIXED THE HEARING OF ASSES SEES CASE ON 07.12.2007, BUT NEITHER THE ASSESSEE NOR HIS A.R. APPEARED TO PROSE CUTE THE MATTER IN DISPUTE. ON THE FACE OF ASSESSMENT RECORD, WE CAN SAY THAT THE ASSE SSEE REMAINED NON CO-OPERATIVE IN THE ASSESSMENT PROCEEDINGS, BUT BEING A TIME BARRED CASE, THE A.O. HAS COMPLETED THE ASSESSMENT EX-PARTE UNDER SECTION 144 OF THE AC T ON THE BASIS OF MATERIAL AND 4 FACTS AVAILABLE ON RECORD ON 31.03.2005 BY MAKING V ARIOUS ADDITIONS. AGGRIEVED BY THE SAME, THE ASSESSEE FILED APPEAL BEFORE THE LD. FIRST APPELLATE AUTHORITY WHO, VIDE THE IMPUGNED ORDER DATED 31.12.2009, PARTLY ALLOWED THE APPEAL OF THE ASSESSEE BY DELETING THE ONE MAJOR ADDITION OF RS.10,01,808/- O N ACCOUNT OF UNEXPLAINED OPENING CAPITAL UNDER SECTION 69 OF THE ACT AND, ON REMAINI NG ADDITIONS, THE LD. CIT(A) HAS CONFIRMED THE ORDER OF THE A.O. IN WHICH HE HAS MAD E VARIOUS ADDITIONS AS MENTIONED IN THE ASSESSMENT ORDER. NOW, THE REVENU E HAS COME IN APPEAL AGAINST THE DELETION OF RS.10,01,808/- ON ACCOUNT OF UNEXPL AINED OPENING CAPITAL UNDER SECTION 69 AND THE ASSESSEE HAS COME IN APPEAL ON T HE REMAINING ADDITIONS SUSTAINED BY THE LD. FIRST APPELLATE AUTHORITY. 5. NOTICE OF HEARING WAS ISSUED TO THE ASSESSEE BY REGISTERED POST ACKNOWLEDGMENT DUE. IN RESPONSE TO THE SAME, NEITH ER THE ASSESSEE NOR HIS A.R. APPEARED TO PROSECUTE THE MATTE IN DISPUTE NOR FILE D ANY APPLICATION FOR ADJOURNMENT. KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE CONSIDERED OPINION THAT NO USEFUL PURPOSE WOULD BE SERVED BY I SSUING NOTICE AGAIN AND AGAIN TO THE ASSESSEE. THEREFORE, WE HAVE DECIDED TO ADJUDI CATE THE ISSUE IN DISPUTE ON THE BASIS OF MATERIAL AVAILABLE ON RECORD. 5 6. AT THE TIME OF HEARING, THE LD. DEPARTMENTAL REP RESENTATIVE (D.R.) RELIED UPON THE ORDER PASSED BY THE A.O. AS WE HAVE STATED ABO VE, THE ASSESSEE HAS NOT APPEARED TO PROSECUTE THE MATTER IN DISPUTE INSPITE OF ISSUE OF NOTICE TO HER, BUT THE ASSESSEE MAINLY CONTENDED AND CHALLENGED THE IMPUGN ED ORDER ON THE BASIS OF NATURAL JUSTICE. THE ASSESSEE STATED THAT THE REVE NUE AUTHORITIES HAVE NOT PROVIDED SUFFICIENT OPPORTUNITY TO THE ASSESSEE AND DECIDED THE ISSUE IN DISPUTE AGAINST THE ASSESSEE EX-PARTE. SHE FURTHER STATED IN THE GROUN DS OF APPEAL THAT THE LD. I.T.O. HAS WRONGLY REJECTED THE BOOKS OF ACCOUNTS AND APPLIED THE PROVISIONS OF SECTION 145 OF THE ACT. SHE ALSO PLEADED THAT THE ASSESSMENT IN D ISPUTE IS ON THE BASIS OF GUESS WORK AND SURMISES WHICH DESERVES TO BE QUASHED. 7. WE HAVE HEARD THE LD. D.R. AND PERUSED THE RELEV ANT RECORDS AVAILABLE WITH US, ESPECIALLY THE ASSESSMENT ORDER PASSED BY THE A.O. UNDER SECTION 144 OF THE ACT ALONG WITH THE IMPUGNED ORDER PASSED BY THE LD. FIR ST APPELLATE AUTHORITY. WE ARE OF THE CONSIDERED OPINION THAT THE A.O. HAS COMPLET ED THE ASSESSMENT ON 31.03.2005 UNDER SECTION 144 OF THE ACT. NO DOUBT, THE ASSESS EE REMAINED NON CO-OPERATIVE BEFORE THE A.O., BUT WE FIND THAT THE A.O HAS ADJOU RNED THE PROCEEDINGS FOR VERY SHORT PERIOD AND HAS NOT GIVEN SUFFICIENT TIME TO T HE ASSESSEE FOR SUBSTANTIATING HER CLAIM IN THE ASSESSMENT PROCEEDINGS. WE ARE NOT CO MMENTING UPON THE MERIT OF THE CASE BECAUSE IT WILL PREJUDICE TO THE MIND OF THE R EVENUE AUTHORITIES. THEREFORE, WE 6 ARE OF THE CONSIDERED OPINION THAT THE A.O AS WELL AS THE LD. FIRST APPELLATE AUTHORITY HAS NOT PROVIDED SUFFICIENT OPPORTUNITY T O THE ASSESSEE FOR SUBSTANTIATING HER CLAIM. KEEPING IN VIEW THE FACTS AND CIRCUMSTA NCES OF THE PRESENT CASE, WE ARE OF THE CONSIDERED OPINION THAT, IN THE INTEREST AND JUSTICE, THE MATTER REQUIRES RE- EXAMINATION AT THE LEVEL OF A.O. THEREFORE, WE SET ASIDE THE ISSUE IN DISPUTE INVOLVED IN THE REVENUES AS WELL AS ASSESSEES APP EALS TO THE A.O. WITH THE DIRECTION TO PROVIDE FULL OPPORTUNITY TO THE ASSESS EE FOR SUBSTANTIATING HER CLAIM AND DECIDE THE ISSUE IN DISPUTE ACCORDING TO LAW. IT I S ALSO MADE CLEAR THAT IF THE ASSESSEE AGAIN REMAINS NON CO-OPERATIVE IN THE ASSESSMENT PR OCEEDINGS, THE A.O. IS AT LIBERTY TO DECIDE THE ISSUE IN DISPUTE ACCORDING TO LAW, BU T SUFFICIENT OPPORTUNITY SHOULD BE PROVIDED TO THE ASSESSEE. 8. IN THE RESULT, APPEALS FILED BY THE REVENUE AS W ELL AS ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSE. (ORDER PRONOUNCED IN THE OPEN COURT ON 21.04.2011) SD/- SD/- (P.K. BANSAL) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER PLACE: AGRA DATE: 21 ST APRIL, 2011 7 PBN/* COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT BY ORDER 3. CIT CONCERNED 4. CIT (APPEALS) CONCERNED 5. DR, ITAT, AGRA BENCH, AGRA 6. GUARD FILE ASSISTANT REGISTRAR INCOME-TAX APPELLATE TRI BUNAL, AGRA TRUE COPY