Ashok Acharya, Bhubaneswar V. ITO, Ward-2(1), Bhubaneswar

ITA 51/CTK/2018

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 3067 (ITAT-CUTTACK)
• Duration Of Justice: 4 year(s) 3 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-05-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 01-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S.K MOHAPAT RA
• Keywords: Principle of natural justice
• Section: 43(5)

Judgement Text

आयकर अपीऱीय अधिकरण, कटक न्यायपीठ,कटक IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH CUTTACK श्री जाजज माथन, न्याययक सदस्य एवं श्री अरुण खोड़पऩया ऱेखा सदस्य के समक्ष । BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI ARUN KHODPIA, ACCOUNTANT MEMBER ITA No.51/CTK/2018 (नििाारण वषा / Asses s m ent Year :2011-2012) Sri Ashok Acharya Plot No.N-4/311, IRC Village, Nayapalli, Bhubaneswar-751015 Vs ITO, Ward-2(1), Bhubaneswar P AN No. : ADCPA 6490 P (अऩीऱाथी /Appellant) .. (प्रत्यथी / Respondent) यनधाजररती की ओर से /Assessee by : None राजस्व की ओर से /Revenue by : Shri S.K .Mohapat ra , CIT-DR स ु नवाई की तारीख / Date of Hearing : 05/05/2022 घोषणा की तारीख/Date of Pronouncement : 05/05/2022 आदेश / O R D E R Per Bench : This is an appeal filed by the assessee against the order of the ld. CIT(A)-2, Bhubaneswar, in I.T.Appeal No.0176/2014-15, dated 11.10.2017 for the assessment year 2011-2012. 2. The present appeal has been filed by the assessee on 05.06.2018 and the appeal has been posted for hearing on multiple occasions but the same has been continuously adjourned number of times at the request of the assessee. As this is a very old appeal and number of adjournments have also been granted in this case and also on the reasons for non- representation on behalf of the assessee today, this appeal is being disposed off on merits. ITA No.51/CTK/2018 2 3. Shri S.K.Mohapatra, ld. CIT-DR represented on behalf of the revenue and submitted that the assessee is an individual, who is deriving income from profession as a doctor and also receives remuneration as a Director in Aayush Hospitals Pvt. Ltd., interest income and honorarium etc. It was submitted that in assessee’s appeal two issues have been raised. 4. In ground No.2 of the assessee’s appeal, the assessee has challenged the action of the ld. CIT(A) in sustaining the addition made by the AO to the tune of Rs.8,87,83,509/- representing unsecured creditors. It was submitted by the ld. CIT-DR that before the ld. CIT(A) the assessee has initially changed his stand in respect of creditors, which is brought out by the ld. CIT(A) in para 3.8 of his order. It was also the submissions of the ld. CIT-DR that none of the creditors was produced before the AO and the letter issued by the AO to the creditors remained unanswered. It was also the submission of the ld. CIT-DR that whenever notices in respect of the remand proceedings were sent to the assessee, the assessee claimed that the assessee has not received any notices. It was further submitted that the assessee has also not been able to prove that the transactions with the alleged creditors were genuine or that the creditors were creditworthy. It was also the submission of the ld. CIT-DR that the ld. CIT(A) had confirmed the addition, therefore, he prayed that the Tribunal may also confirm the same in the interest of justice. 5. As mentioned earlier, none represented on behalf of the assessee. ITA No.51/CTK/2018 3 6. We have considered the submissions of the ld. CIT-DR and perused the relevant materials on record. 7. A perusal of the order of the ld. CIT(A), more specifically in para 3.8, shows that multiple opportunities have been given to the assessee to prove the alleged loan creditors. Ld. CIT(A) has also categorically given finding that only photocopies of the loan confirmations in the case of two persons have been submitted. Those loan confirmations are also having substantially defects insofar as the PAN account number of one of the creditors is not there and in case of another there is no address. It was also noticed that in case of Micro Hospital Pvt. Ltd. the amount claimed as loan received by the assessee is in fact shown in the accounts of Micro Hospital Pvt. Ltd. as an investment in the Ayush Hospital Pvt. Ltd., wherein the assessee is a director. It is noticed that the ld. CIT(A) after considering all the above facts held that the assessee had failed to establish the identity of the loan creditors, genuineness of the transactions and the creditworthiness of the loan creditors. However, considering the fact that the assessee has been repeatedly submitting that the creditors are genuine, in the interest of natural justice and to grant the assessee a final opportunity to prove his loan creditors, the issue in this appeal is restored to the file of the AO for readjudication after granting the assessee adequate opportunity of being heard. As the assessee has been repeatedly claiming that he is not receiving notice from the AO, therefore, it is directed that the assessee shall appear before the AO on any date in the week commencing from 11 th July, 2022 and ending on 15 th July, ITA No.51/CTK/2018 4 2022. He shall produce the loan creditors for cross-examination by the AO and in the event that the assessee is unable to produce the loan creditors, he would have to give justifiable and valid reasons for the same. Once the assessee appears before the AO and produces his creditors, the AO shall adjudicate the issue after granting adequate opportunity to the assessee to substantiate his case, in accordance with law. Thus, ground No.2 of the assessee’s appeal is partly allowed for statistical purposes. 8. In respect of ground No.3 of the assessee’s appeal, it was submitted by the ld. CIT-DR that the assessee has claimed set off of loss on share trading to the tune of Rs.1,22,90,893/-. It was the submissions of the ld. CIT-DR that even after substantial opportunity had been given, the assessee was unable to prove that the loss was allowable u/s.43(5) of the I.T.Act. It was also the submission of the ld. CIT-DR that though the assessee claims that the transactions in the shares on which he had incurred the loss was after taking physical possession of the shares, however, no evidence for the same had been produced. It was also the prayer of the ld. CIT-DR that the disallowance of loss may be upheld. 9. We have considered the submissions of the ld. CIT-DR. A perusal of the order of the ld. CIT(A) and that of the AO clearly shows that the assessee has not produced any evidence to show that the loss claimed by the assessee in respect of the share trading activity complied with all the conditions mentioned in the Section 43(5) of the I.T.Act. As we have already restored the issue of the alleged loan creditors to the AO, in the interest of natural justice, we are of the view that this issue should also be ITA No.51/CTK/2018 5 restored to the file of AO for readjudication to grant the assessee adequate opportunity to produce all evidences as are available with him to show that the share trading activity done by him which has resulted into loss complied with all the conditions u/s.43(5) of the Act, and we do so. Thus, ground No.3 of the assessee’s appeal stands partly allowed for statistical purposes. 10. Grounds No.1, 4 & 5 are general in nature, which do not require any adjudication. 11. In the result, appeal of the assessee is partly allowed for statistical purposes. Order dictated and pronounced in the open court on 05/05/2022. Sd/- (अरुण खोड़पऩया) (ARUN KHODPIA) Sd/- (जाजज माथन) (GEORGE MATHAN) ऱेखा सदस्य/ ACCOUNTANT MEMBER न्यानयक सदस्य / JUDICIAL MEMBER कटक Cuttack; ददनाांक Dated 05/05/2022 Prakash Kumar Mishra, Sr.P.S. आदेश की प्रनिलऱपप अग्रेपषि/Copy of the Order forwarded to : आदेशाि ु सार/ BY ORDER, (Senior Private Secretary) आयकर अपीऱीय अधिकरण, कटक/ITAT, Cuttack 1. अऩीऱाथी / The Appellant- Sri Ashok Acharya Plot No.N-4/311, IRC Village, Nayapalli, Bhubaneswar-751015 2. प्रत्यथी / The Respondent- ITO, Ward-2(1), Bhubaneswar 3. आयकर आय ु क्त(अऩीऱ) / The CIT(A), 4. आयकर आय ु क्त / CIT 5. पवभागीय प्रयतयनधध, आयकर अऩीऱीय अधधकरण, कटक / DR, ITAT, Cuttack 6. गार्ज पाईऱ / Guard file. सत्यापऩत प्रयत //True Copy//