ITO, Coimbatore V. Shri M.Abdul Haque, Coimbatore

ITA 515/CHNY/2011

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 51764 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-08-2011
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 23-08-2011
• Assessment Year: 2008-2009
• Appeal Filed On: 21-03-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ANIRUDH RAI
• Keywords: Unexplained investment; Opportunity of being heard; Set aside
• Section: 143(3); 133A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, CHENNAI B E F O R E DR. O.K.NARAYANAN, VICE PRESIDENT AND SHRI HARI OM MARATHA, JUDICIAL MEMBER .. ITA NO.515(MDS)/2011 ASSESSMENT YEAR: 2008-09 THE INCOME-TAX OFFICER, WARD II(4), COIMBATORE. VS. SHRI M.ABDUL HAQUE, 6, SURYA GARDEN, BHARATHI COLONY, PEELAMEDU, COIMBATORE-641 004. PAN AGPKA3534H. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ANIRUDH RAI C IT DR RESPONDENT BY: NONE DATE OF HEARING : 23 RD AUGUST, 2011 DATE OF PRONOUNCEMENT : 23 RD AUGUST, 2011 - - ITA NO.515 OF 2011 2 O R D E R PER DR.O.K.NARAYANAN, VICE-PRESIDENT: THIS APPEAL IS FILED BY THE REVENUE. THE RELEVAN T ASSESSMENT YEAR IS 2008-09. THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-I AT COIMBATORE DATED 3-12-2010 AND ARISES OUT OF THE AS SESSMENT COMPLETED UNDER SECTION 143(3) OF THE INCOME-TAX AC T, 1961. 2. THE ASSESSEE IS AN INDIVIDUAL RUNNING THE BUSIN ESS OF HOARDING AND PUBLICITY. THERE WAS A SURVEY UNDE R SECTION 133A ON 16-10-2008, IN THE COURSE OF WHICH IT WAS S TATED BY THE ASSESSEE THAT HE HAS MADE AN INVESTMENT OF ` 19,00,000/- IN PURCHASE OF LAND AT ANNUR. THE SOURCE OF INVESTMEN T WAS NOT EXPLAINED BEFORE THE SURVEY OFFICERS. 3. IN THE COURSE OF THE ASSESSMENT PROCEEDINGS, WH EN THE MATTER WAS PUT TO THE ASSESSEE, IT WAS STATED T HAT NO INVESTMENT WAS MADE AS SUCH IN THE PROPERTY TO THE EXTENT OF ` 19 LAKHS, BUT ONLY AN ADVANCE OF ` 10 LAKHS WAS GIVEN BY THE ASSESSEE. ACCORDINGLY, THE ASSESSING AUTHORITY TRE ATED THE DIFFERENTIAL AMOUNT OF ` 9 LAKHS AS UNEXPLAINED INVESTMENT. - - ITA NO.515 OF 2011 3 4. THERE WAS A CASH CREDIT OF ` 10 LAKHS IN THE CAPITAL ACCOUNT OF THE ASSESSEE, WHICH ALSO WAS NOT EXPLAIN ED. THEREFORE, THIS AMOUNT ALSO WAS ADDED. ACCORDINGLY , THE ASSESSMENT WAS COMPLETED WITH AN ADDITION OF ` 19 LAKHS TO THE INCOME OF THE ASSESSEE. 5. IN FIRST APPEAL THE COMMISSIONER OF INCOME TAX (APPEALS) DELETED THE ADDITION OF ` 19 LAKHS AND ALLOWED THE APPEAL OF THE ASSESSEE. THE REVENUE IS AGGRIEVED A ND, THEREFORE, THIS SECOND APPEAL BEFORE THE TRIBUNAL. 6. THE GROUNDS RAISED BY THE REVENUE IN THIS APPEA L READ AS UNDER:- 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) ERRED IN DELETING THE ADDITION OF ` 19 LAKHS HOLDING THAT THE ADDITION WAS NOT BASED ON ANY FINDING NEITHER DURING THE COURSE OF SURVEY, NOR DURING THE COURSE OF ASSESSMENT PROCEEDINGS, EXCEPT FOR THE SWORN STATEMENT RECORDED DURING THE COURSE OF SURVEY. 2. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IGNORED THE FACT THAT THE ASSESSEE COULD NOT EXPLAI N WITH MATERIAL EVIDENCE THE SOURCE FOR ` 19 LAKHS. - - ITA NO.515 OF 2011 4 3. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) FAILED TO CONSIDER THE FACT THAT THE ASSESSEE HAS S HOWN ONLY AN AMOUNT OF ` . 10 LAKHS IN HIS BALANCE SHEET AS ADVANCE PAID. 4. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) OUGHT TO HAVE CONSIDERED THAT THE SAID AMOUNT SHOWN AS CASH CREDIT IN THE CAPITAL ACCOUNT COULD NOT BE RECONCILED WITH THE CASH BOOK. 7. WHEN THE MATTER WAS CALLED ON FOR HEARING, NOBO DY WAS PRESENT FOR THE RESPONDENT-ASSESSEE INSPITE OF NOTICE. WE HEARD SHRI ANIRUDH RAI, THE LEARNED COMMISSIONER OF INCOME-TAX APPEARING FOR THE REVENUE. 8. THERE IS A DELAY OF 13 DAYS IN FILING THIS APPE AL BY THE REVENUE. THE DELAY HAS BEEN SATISFACTORILY EXP LAINED AND THE SAME IS CONDONED. 9. WE FIND THAT THERE IS A GLARING CONTRADICTION I N THE STATEMENT GIVEN BY THE ASSESSEE AT THE TIME OF SURV EY AND THE DETAILS FURNISHED AT THE TIME OF ASSESSMENT. THE A SSESSING OFFICER ALSO HAS NOT ENQUIRED INTO THE LOGICAL CONC LUSION REGARDING THE PROPOSED TRANSACTION OF THE ASSESSEE AS INVESTMENT. EARLIER THE ASSESSEE HAS STATED THAT THE INVESTMENT - - ITA NO.515 OF 2011 5 IN THE PROPERTY WAS ` 19 LAKHS. AT THE TIME OF ASSESSMENT IT WAS STATED THAT ONLY AN ADVANCE OF ` 10 LAKHS WAS GIVEN TO THE PARTY. BUT THE ASSESSING OFFICER ALSO DID NOT EXAMINE ABOU T THE FINAL DOCUMENTATION OF THE TRANSACTION AND WHAT WAS THE S ITUATION OF THE PROPERTY AT THAT POINT OF TIME. WITHOUT EXAMIN ING SUCH NECESSARY DETAILS, IT IS NOT POSSIBLE TO GET A FULL PICTURE OF THE CASE. 10. WHAT WE FIND IS THAT THE CONTRADICTION IN THE STATEMENTS OF THE ASSESSEE HAS NOT BEEN EXPLAINED A S WELL AS THE FINDING OF THE ASSESSING AUTHORITY ALSO SEEMS T O BE PREMATURE. IT IS ALSO TO BE SEEN THAT THE ASSESSEE HAS NOT EXPLAINED THE CREDIT OF ` 10 LAKHS REFLECTED IN HIS CAPITAL ACCOUNT. IF AT ALL THAT IS TO BE ADDED, THE ASSESSING OFFICE R HAS ALSO NOT CONSIDERED THE POSSIBILITY OF GIVING THE BENEFIT OF TELESCOPING. 11. THE COMMISSIONER OF INCOME TAX (APPEALS) ADJUDICATED THE ISSUE WITHOUT REFERRING TO ANY OF T HE FUNDAMENTAL ISSUES STATED ABOVE. THEREFORE HIS ORDER IS EQUALL Y ARBITRARY. 12. IN THE FACTS AND CIRCUMSTANCES OF THE CASE WE SET ASIDE THE ORDERS OF THE LOWER AUTHORITIES AND REMIT BACK THE FILE TO THE ASSESSING OFFICER FOR DOING THE ASSESSMENT AFRE SH IN - - ITA NO.515 OF 2011 6 ACCORDANCE WITH LAW AFTER GIVING THE ASSESSEE AN EF FECTIVE OPPORTUNITY OF BEING HEARD. 13. IN RESULT THIS APPEAL FILED BY THE REVENUE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ON TUESDAY, THE 23 RD DAY OF AUGUST, 2011 AT CHENNAI. SD/- SD/- (HARI OM MARATHA) (DR. O.K.NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI, DATED THE 23 RD AUGUST, 2011. V.A.P. COPY TO: (1) APPELLANT (2) RESPONDENT (3) CIT (4) CIT(A) (5) D.R. (6) G.F.