Shri BaliRam (Deceased) Th L/H Shri Satender Kumar, Uttar Pradesh V. ITO, Noida

ITA 5206/DEL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86467 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 3 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-01-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 05-01-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 16-09-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MRS Y KAKKAR
• Assessee Lawyers: MRS PREM LATA BANSAL; RAM AVTAR BANSAL
• Keywords: Unexplained cash credit; Opportunity of being heard; Additional evidence
• Section: 143(3); 68; 148

Judgement Text

IN TH E INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : A : NEW DELHI BEFORE SHRI N.K. SAINI , ACCOUNTANT MEMBER AND SHRI GEORGE GEORGE K. , JUDICIAL MEMBER ITA NO . 5206 / DEL / 20 13 ASSESSMENT YEAR : 200 7 - 0 8 SHRI BALI RAM (DECEASED) TH L/H SHRI SATENDER KUMAR VILLAGE KHERLI, HAFIZPUR, P.O. GURUKUL, M.S. NAGAR, DISTT G.B. NAGAR, U.P. VS. INCOME TAX OFFICER, WARD 3 ( 1 ), NOIDA, U.P. (PAN AXXPB 0327 R ) (APPELLANT ) (RESPONDENT) APPELLANT BY : MRS. PREM LATA BANSAL , SR. ADVOCATE AND SHRI RAM AVTAR BANSAL , ADVOCATE RESPONDENT BY: MRS. Y. KAKKAR, SR. DR . ORDER PER SHRI GEORGE GEORGE K. , J M : 1. THIS APPEAL, AT THE INSTANCE OF THE ASSESSEE, IS DIRECTED AGAINST THE CIT(A) S ORDER DATED 20.05.2013 . THE RELEVANT ASSESSMENT YEAR IS 200 7 - 0 8 . 2. BRIEF FACTS OF THE CASE ARE AS FOLLOWS. THE ASSESSEE IS AN INDIVIDUAL. THE ASSESSING OFFICER ISSUED NOTICE U/S 148 OF THE I.T. ACT TO THE ASSESSEE ON 06.05.2010 FOR THE REASON TH AT THERE WERE UNEXPLAINED CASH DEPOSITS IN HIS BANK ACCOUNT . IN RESPONSE TO THE NOTICE U/S 148 OF THE ACT , RETURN OF INCOME WAS FILED ON 01.12.2011 ITA NO. 5206 /DEL /20 13 2 DECLARING AGRICULTURAL INCOME OF RS.24,000/ - . THE ASSESSMENT U/S 143(3) R.W.S. 147 OF THE ACT WAS COMPLETED ON 30.12.2011 ON A TOTAL INCOME OF RS.31,76,000/ - . 3. THE CIT(A) CONFIRMED THE ASSESSMENT ORDER. THE RELEVANT FINDING OF THE CIT(A) READS AS FOLLOWS: - (AT PAGE 5) (AT PAGE 5) IN THE COURSE OF ASSESSMENT PROCEEDINGS THE A.O. FOUND THAT THE ASSESSEE HAS DEPOSITED CASH OF RS.24,50,000/ -- ON 2/3/2007 AND RS. 10,00,000/ - ON 5/3/2007 IN HIS BANK ACCOUNT WITH OBC, MANDI SHYAM NAGAR, GREATER NOIDA. ON BEING ASKED TO EXPLAIN THE SOURCE OF ABOVE CASH DEPOSIT THE ASSESSEE STATED THAT HE HAS ENTERED INTO AN AGREEMENT TO SELL FOR SELLING HIS AGRICULTURAL LAND FOR A CONSIDERATION OF RS.30,00,000/ -- OUT OF WHICH RS.25,00,000/ - WAS DEPOSITED IN OBC ON 2/3/2007. HE FURTHER STATED THAT THE DEAL D ID NOT MATERIALIZE. IN THIS REGARD, THE A.O. SPECIFICALLY ASKED THE ASSESSEE TO FURNISH COPY OF AGREEMENT TO SELL AND TO PRODUCE THE PERSON WITH WHOM THE AGREEMENT TO SELL WAS MADE. FROM THE ASSESSMENT ORDER I FIND THAT THE A.O. PROVIDED MORE THAN SUFFICIE NT TIME AND OPPORTUNITIES TO THE ASSESSEE BUT THE ASSESSEE HAS COMPLETELY FAILED TO FURNISH THE COPY OF AGREEMENT TO SELL AND PRODUCE THE PERSON WITH WHOM THE AGREEMENT OF SELL WAS ENTERED INTO. IN THE LIGHT OF ABOVE FACTS THAT THE ASSESSEE COMPLETELY FAIL ED TO FURNISH NECESSARY EVIDENCE AND RELEVANT MATERIAL IN SUPPORT OF HIS CONTENTION, I AGREE WITH A.O.'S FINDINGS THAT THE ASSESSEE HAS FAILED TO PROVE THE GENUINENESS AND THE SOURCE OF CASH DEPOSIT OF RS. 24,50,000/ - IN HIS BANK ACCOUNT. SINCE THE ASSESSE E COMPLETELY FAILED TO DISCHARGE HIS ONUS IN THIS REGARD I FIND THAT THE A.O. WAS JUSTIFIED IN HOLDING THE IMPUGNED CASH DEPOSIT AS UNEXPLAINED CASH CREDIT WHICH WAS RIGHTLY ADDED TO THE ASSESSEE'S INCOME U/S 68 OF THE INCOME TAX ACT. FURTHER, THE A.O. ALSO FOUND THAT THE ASSESSEE HAD DEPOSITED ANOTHER RS.10 LACS IN CASH ON 5/3/2007 IN THE SAME BANK. ONCE AGAIN THE ASSESSEE WAS SPECIFICALLY ASKED TO FURNISH THE SOURCE OF ABOVE CASH DEPOSIT. IN RESPONSE THE ASSESSEE CONTENDED THAT THE SAID CASH DEPOSIT WA S OUT OF SALE PROCEEDS OF HIS AGRICULTURAL LAND AND FURNISHED THE COPY OF THE SALE DEED IN SUPPORT OF HIS CONTENTION. HOWEVER, ON EXAMINATION OF THE SALE DEED A.O. NOTICED THAT THE LAND WAS SOLD ONLY FOR RS. 4 LACS. AS SUCH THE A.O. TREATED RS.4 LACS OUT O F CASH DEPOSIT OF RS.10 LACS AS EXPLAINED AND REGARDING BALANCE OF RS.6 LACS ASSESSEE WAS ASKED TO EXPLAIN THE SOURCE. ONCE AGAIN DESPITE ALLOWING SUFFICIENT TIME AND OPPORTUNITY THE ASSESSEE FAILED TO FURNISH ANY EXPLANATION IN THIS REGARD FORCING THE AO. TO TREAT THE BALANCE AMOUNT OF RS.6 LACS AS UNEXPLAINED CASH CREDIT IN THE HANDS OF THE ASSESSEE U/S. 68 OF THE I.T. ACT, 1961. ITA NO. 5206 /DEL /20 13 3 BESIDES ABOVE, THE AO. ALSO NOTICED FURTHER CASH DEPOSIT OF RS 1,50,000/ - IN HIS BANK ACCOUNT IN RESPECT OF WHICH THE ASSESSEE STATED THAT THE AMOUNT IN QUESTION WAS OUT OF SELL OF AGRICULTURAL PRODUCE. IN THIS REGARD, THE AO. OBSERVED THAT THE ASSESSEE HAD SHOWN GROSS AGRICULTURAL INCOME OF RS. 24,0001 - ONLY, IN HIS RETURN OF INCOME FILED U/S.148 OF THE LT. ACT, 1961 AND THEREFOR E THE ASSESSEE WAS ASKED TO EXPLAIN THE SOURCE OF REMAINING CASH DEPOSIT OF RS. 1,26,000/ - (RS.1,50,000/ - RS.24,0001 - ). ONCE AGAIN, DESPITE HAVING BEEN GIVEN SUFFICIENT OPPORTUNITIES, THE ASSESSEE CHOSE NOT TO FURNISH ANY EXPLANATION IN THIS REGARD. CONSEQ UENTLY, ONCE AGAIN THE AO. HAD NO OPTION BUT TO TREAT THE CASH DEPOSIT OF RS. 1,26,000/ - AS UNEXPLAINED CASH CREDIT U/S. 68 OF THE LT. ACT WHICH WAS RIGHTLY ADDED BY THE A.O TO THE TOTAL INCOME OF THE ASSESSEE. IN THE APPELLATE PROCEEDINGS THE AR OF THE A PPELLANT WAS ASKED TO PRODUCE NECESSARY EVIDENCES IN SUPPORT OF HIS CONTENTIONS REGARDING SOURCE OF CASH DEPOSIT BUT VIDE LETTER DATED 15/3/2013 THE AR OF THE APPELLANT HAS CATEGORICALLY STATED BEFORE ME THAT THEY HAVE NOT BEEN ABLE TO LOCATE DOCUMENTARY E VIDENCE IN SUPPORT OF THEIR CONTENTION AND THEREFORE, IT WAS REQUESTED THAT THE APPEAL MAY BE DECIDED ON THE BASIS OF MATERIALS AVAILABLE ON RECORD. IN THE LIGHT OF ABOVE DISCUSSION AND BASED ON SUBMISSIONS MADE BY THE AR OF THE ASSESSEE EXPRESSING THEIR INABILITY TO PRODUCE ANY EVIDENCE WHATSOEVER IN SUPPORT OF THEIR CONTENTION IN THE ASSESSMENT PROCEEDING AS WELL AS IN THE PRESENT APPELLATE PROCEEDINGS, I CONFIRM THE TOTAL ADDITIONS OF RS. 31,76,000/ - MADE BY A.O. U/S. 68 OF THE I.T. ACT ON ACCOUNT OF UN EXPLAINED CASH DEPOSIT IN THE BANK ACCOUNT OF THE ASSESSEE . DURING THE APPELLATE PROCEEDINGS IT WAS ALSO POINTED OUT THAT THE APPELLANT HAS EXPIRED ON 21/2/2012 AND THAT ONE OF HIS SONS SH. SATENDER KUMAR UNDER HIS SIGNATURE CLAIMED THAT HE BE TREATED AS LEGAL REPRESENTATIVE OF THE APPELLANT FOR THE PURPOSE OF PRESENT APPEAL. SUBSEQUENTLY, VIDE LETTER DATED 15/5/2013 FOUR BROTHERS NAMELY SH. NARENDER KUMAR, SH. SURENDER KUMAR, SH. SATENDER KUMAR AND SH. VIJAY SINGH UNDER THEIR SIGNATURES CLAIMED THAT THEY ALL ARE THE LEGAL HEIRS OF THE APPELLANT SH. BALI RAM AND THAT ONE OF THEIR BROTHERS SH. SATNEDER SINGH BE TREATED AS LEGAL REPRESENTATIVE FOR THE PURPOSE OF THIS APPEAL. IN THE LIGHT OF ABOVE, THIS APPEAL ORDER IS BEING PASSED U/S.250 OF THE I.T. ACT IN THE NAME OF SH. BALI RAM AS REPRESENTED BY HIS LEGAL HEIR SH.SATENDER SINGH. 6. IN THE RESULT THE APPEAL IS DISMISSED. 4. THE ASSESSEE BEING AGGRIEVED IS IN APPEAL BEFORE US RAISING 14 GROUNDS. ALL THE GROUNDS RELATE TO THE ISSUE OF REOPENING OF ASSESS MENT ITA NO. 5206 /DEL /20 13 4 U/S 148 AND ADDITIONS MADE U/S 68 OF THE ACT. THE ASSESSEE HAS ALSO FILED AN APPLICATION UNDER RULE 11 OF APPELLATE TRIBUNAL RULES, SEEKING ADMISSION OF ADDITIONAL GROUND . THE ADDITIONAL GROUND RAISED READ AS UNDER : - I) THAT THE ASSESSMENT ORDER FR AMED BY THE ASSESSING OFFICER WAS BAD - IN - LAW AS NO NOTICE U/S 143(2) OF THE ACT WAS ISSUED AND SERVED ON THE ASSESSEE BEFORE FRAMING ASSESSMENT U/S 143(3)/147 OF THE ACT. II) THAT THE ASSESSMENT ORDER PASSED BY THE AO WITHOUT COMPLYING WITH SECTION 143(2) OF THE ACT IS INVALID AND THEREFORE, LIABLE TO BE STRUCK DOWN. 5. THE RELEVANT PORTION OF APPLICATION FOR ADMISSION OF THE ADDITIONAL GROUNDS READS AS FOLLOWS : - D) THAT THOUGH THE ISSUE WITH RESPECT TO VALIDITY OF THE ASSESSMENT ORDER HAD BEEN RAISED BY THE ASSESSEE BEFORE THE CIT(A), THE SAME WAS NOT SPECIFIC TO THE ISSUE EVEN OTHERWISE CIT(A) HAS NOT ADJUDICATED UPON THIS ISSUE. HENCE BY WAY OF THIS APPLICATION, TH E SPECIFIC ISSUE HAS BEEN SOUGHT TO BE RAISED. E) THAT ACCORDINGLY, THE PRESENT APPLICATION IS BEING FILED SEEKING ADMISSION OF THE ADDITIONAL GROUNDS OF APPEAL WHICH HAVE NOT BEEN SET FORTH IN THE APPEAL ORIGINALLY. F) THAT THE PRESENT APPLICATION IS BONAFIDE. THE BALANCE OF CONVENIENCE IS IN FAVOUR OF APPELLANT. IF THE SAID APPLICATION IS NOT ALLOWED, IRREPARABLE LOSS WOULD BE CAUSED TO THE ASSESSEE. IN VIEW OF ABOVE, IT IS MOST RESPECTFULLY PRAYED THAT THE ADDITIONAL GROUNDS OF APPEAL PORPOSED TO BE RAISED NOW BE ADMITTED AND THE APPEAL BE HEARD ON ALL THE GROUNDS INCLUDING THE ADDITIONAL GROUNDS OF APPEAL IN THE INTEREST OF JUSTICE. ITA NO. 5206 /DEL /20 13 5 6. THE ASSESSEE HAS ALSO FILED AN APPLICATION UNDER RULE 29 OF THE ITAT, RULE SEEKIN G PERMISSION TO BRING ON RECORD ADDITIONAL EVIDENCE AND HAS FILED SUPPORTING AFFIDAVIT OF THE LEGAL REPRESENTATIVE OF THE ASSESSEE ( SINCE DECEASED ) . THE RELEVANT PORTION OF THE AFFIDAVIT, STATING THE REASONS TO BRING ON RECORD THE ADDITIONAL EVIDENCE NOW F ILED, READS AS UNDER : - E) THAT, ACCORDINGLY, WHEN THE MATTER CAME - UP BEFORE CIT(A) FOR HEARING, NO DOCUMENT COULD BE FILED AS I COULD NOT TRACE OUT ANY DOCUMENT AND CIT(A) CONFIRMED THE ADDITIONS VIDE ORDER - DATED 20.05.2013 STATING THAT THE LEGAL HEIRS WERE NOT ABLE TO PRODUCE A NY DOCUMENTARY EVIDENCE. F) THAT AGAINST THIS ORDER, I ON BEHALF OF MYSELF AND ON BEHALF OF ALL THE LEGAL HEIRS OF THE DECEASED ASSESSEE FILED THE APPEAL BEFORE THIS HON'BLE TRIBUNAL. SINCE THE HEAVY DEMAND WAS RAISED BY THE ASSESSING OFFICER WHICH WAS B EYOND OUR REACH, WE STARTED MAKING INQUIRY AND CAME TO KNOW THAT MY FATHER HAD ENTERED INTO AN AGREEMENT TO SELL WITH SHRI OAYA CHAND SINGH, SON OF SHRI RAGHVIR SINGH, WHO HAPPENS TO BE OUR RELATIVE. HE ADMITTED THAT THE AGREEMENT TO SELL WAS ENTERED FOR S ALE OF AGRICULTURAL LAND SITUATED AT VILLAGE - KHELI HAFIZPUR, GREATER NOIDA FOR A CONSIDERATION OF RS.30 LAC, OUT OF WHICH, HE HAD PAID RS. 26 LAC TO MY FATHER IN CASH ON 01.03.2007. SINCE THIS DEAL DID NOT MATERIALIZE, THE ASSESSEE RETURNED THE MONEY I.E. R S. 26 LAC BACK IN CASH TO HIM. SHRI OAYA CHAND SINGH HAS ALSO GIVEN US HIS AFFIDAVIT TO THIS EFFECT ALONGWITH THE COPY OF HIS BANK ACCOUNT, HIS VOTER'S ID CARD AND THE PAN CARD. G) THAT EVEN DURING THE ASSESSMENT PROCEEDING, THE DECEASED ASSESSEE, MY FATH ER HAD AGREED BEFORE THE ASSESSING OFFICER THAT HE HAD ENTERED INTO AN AGREEMENT TO SELL FOR SALE OF HIS AGRICULTURAL LAND FOR A CONSIDERATION OF RS. 30 LAC OUT OF WHICH, RS. 24.50 LAC HAD BEEN DEPOSITED IN 'ORIENTAL BANK OF COMMERCE ON 02.03.2007. HE HAD AL SO INFORMED THAT THIS DEAL HAD NOT BEEN MATERIALIZED AND THEREFORE, THE AMOUNT HAD BEEN RETURNED BACK. HOWEVER, SINCE IN THE ABSENCE OF AGREEMENT TO SELL, THE ASSESSING OFFICER HAD MADE THE ADDITION WHICH HAD BEEN CONFIRMED BY THE LD. CIT(A). H) THAT THE AFFIDAVIT OF SHRI OAYA CHAND SINGH HAS RELEVANT BEARING ON THE ISSUE INVOLVED IN THE PRESENT APPEAL. IT IS A CORROBORATIVE EVIDENCE TO WHAT HAS BEEN STATED BY MY FATHER DURING THE ASSESSMENT P ROCEEDING AND THEREFORE, IT IS RELEVANT FOR DECIDING THE PRESEN T APPEAL. UNDER RULE 29, ITAT HAS POWER TO ADMIT NEW EVIDENCE FOR SUBSTANTIAL CAUSE AND TO ENABLE IT TO PASS THE ORDERS. ITA NO. 5206 /DEL /20 13 6 I) THAT IT IS NOT OUT OF PLACE TO MENTION HERE THAT I AND MY THREE BROTHERS ARE THE SALARIED PERSONS. MY FATHER WAS AN INDEPENDENT PE RSON AND HAD NOT TAKEN US INTO CONFIDENCE EVEN AT THE TIME OF HIS DEATH AND THEREFORE, MY BROTHERS AND I WERE NOT AWARE OF THE AFFAIRS OF MY FATHER. AFFIDAVIT TO THIS EFFECT IS BEING FILED BONAFIDE AND IN THE INTEREST OF JUSTICE. IN VIEW OF ABOVE, IT IS MOST RESPECTFULLY PRAYED THAT MY AFFIDAVIT AND THE AFFIDAVIT OF SHRI DAYA CHAND SINGH ALONG WITH ANNEXED DOCUMENTS BE TAKEN ON RECORD WHICH ARE NECESSARY TO DEFEND THE PRESENT APPEAL BEFORE THIS HON BLE BENCH. 7. THE LD. DR PRESENT WAS DULY HEARD . SHE V EHEMENTLY OPPOSE THE ADMISSION OF ADDITIONAL GROUNDS AND ALSO THE PETITION TO BRING ON RECORD THE ADDITIONAL EVIDENCE . 8. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. IT IS A CLAIM OF THE ASSESSEE , THAT NO NOTICE U/S 143 (2) OF THE ACT WAS ISSUED AND HENCE THE ASSESSMENT FRAMED U/S 143 R.W.S. 147 IS BAD - IN - LAW AND VOID AB INITIO . T HIS ISSUE, THOUGH NOT RAISED BEFORE THE INCOME TAX AUTHORITIES CAN BE RAISED BEFORE THE APPELLATE FORUM, SINCE IT IS A PURE LEGAL ISSUE WITHOUT BRI NG ON RECORD ANY FRESH DOCUMENTARY EVIDENCE. T HE RELEVANT ASSESSMENT YEAR RECORDS ARE NOT AVAILABLE AND THEREFORE, WE CANNOT EXAMINE THE VERACITY OF THE CLAIM MADE BY THE ASSESSEE/REPRESENTATIVE. MOREOVER, WE FIND THAT THE ADDITIONAL EVIDENCE , WHICH GOES T O THE ROOT OF THE MATTER HAS BEEN FILED BEFORE US AND IN THE INTEREST OF JUSTICE AND EQUITY , THE SAME NEED TO BE TAKEN ON RECORD , FOR A PROPER ADJUDICATION OF THE ISSUE. THEREFORE, THE ISSUE OF WHETHER THERE IS A SERVICE OF THE NOTICE U/S 143(2) OF THE ACT , SHALL BE EXAMINED BY AO FOR ITA NO. 5206 /DEL /20 13 7 THE FIRST TIME AFTER PERUSAL OF MATERIAL ON RECORD. AS REGARDS THE ISSUE ON MERIT (ADDITIONS U/S 68 OF THE ACT), THE AO SHALL DECIDE THE MATTER AFRESH AFTER EXAMINING ADDITIONAL EVIDENCE FILED BEFORE US. THE ASSESSEE SHALL BE GIVEN REASONABLE OPPORTUNITY OF BEING HEARD BEFORE THE ASSESSMENT IS REFRAMED . N EEDLESS TO STATE, THE ASSESSEE S LEGAL REPRESENTATIVE SHALL COOPERATE WITH THE ASSESSING OFFICER FOR EXPEDITIOUS DISPOSAL OF THE MATTER. IT IS ORDERED ACCORDINGLY. 9. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. TH E ORDER IS PRONOUNCED IN THE OPEN COURT ON 05 TH JANUARY , 201 5 . SD/ - SD/ - ( N.K. SAINI ) ( GEORGE GEORGE K.) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 05 TH JANUARY , 201 5 . AKS/ - COPY FORWARDED TO 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST . REGISTRAR, ITAT, NEW D ELHI