M/s Smt. Neeta Rani, Patiala V. ACIT, Patiala

ITA 523/CHANDI/2011

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 5366 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-06-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 13-05-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: JAI SHREE SHARMA
• Assessee Lawyers: K P BAJAJ
• Keywords: Additional evidence
• Section: 142(1); 133(6); 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES B CHANDIGARH BEFORE SHRI D.K.SRIVASTAVE, ACCOUNTANT MEMBER AND MS SUSHMA CHOWLA, JUDICIAL MEMBER ITA NO. 523/CHD/2011 ASSESSMENT YEAR: 2007-08 SMT.NEETA RANI VS. ACIT, H.NO.31, CENTRAL CIRCLE, BHARPUR, PATIALA. PATIALA. PAN NO. AADFPR6309D (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI K.P.BAJAJ RESPONDENT BY : SMT.JAISHREE SHARMA, DR ORDER PER SUSHMA CHOWLA, JM THE APPEAL BY THE REVENUE IS AGAINST THE ORDER OF CIT(A)-I, LUDHIANA DATED 25.3.2011 RELATING TO ASSESSMENT YEA R 2007-08 AGAINST THE ORDER PASSED UNDER SECTION 144 OF THE I .T. ACT. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : 1. THAT THE LEARNED CIT(A) IS NOT JUSTIFIED IN HOL DING THAT THE NOTICES U/S 143(2) AND 142(1) WERE DEEMED TO HAVE BEEN SERVED ON THE ASSESSEE AND THE A.O. WAS JUSTIFIED IN MAKING THE ASSESSMENT U/S 144. 2. THAT THE LD. CIT(A) IS NOT JUSTIFIED IN REJECTI NG THE ADDITIONAL EVIDENCE LEAD BEFORE HIM IN THE ABSENCE OF SERVICE OF ANY NOTICE ON ASSESSEE. 2 3. THAT WITHOUT PREJUDICE TO ABOVE, THE LEARNED. CIT(A) WAS NOT JUSTIFIED IN NOT ADJUDICATING THE ISSUE RAISED AGAINST ADDITION OF RS.30,00,000/- 3. THE ISSUE IN GROUND NO.1 BY THE ASSESSEE IS AGAI NST THE NON- SERVICE OF NOTICES ISSUED U/SS 143(2) & 143(1) OF T HE ACT AND THEREAFTER THE EX-PARTE ASSESSMENT MADE IN THE CASE . THE GROUND NO.2 RAISED BY THE ASSESSEE IS AGAINST THE REJECTIO N OF THE ADDITIONAL EVIDENCE FILED BEFORE THE CIT(A). THE ASSESSEE VID E GROUND NO.3 HAS MADE THE ALTERNATE PLEA THAT THE CIT(A) WAS NOT JUSTIFIED IN NOT ADJUDICATING THE ISSUE REGARDING THE ADDITION OF RS .30 LACS. 4. THE ASSESSMENT IN THE CASE WAS COMPLETED EX-PART E AS THE ASSESSEE FAILED TO APPEAR BEFORE THE ASSESSING OFFI CER. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OF FICER CALLED FOR INFORMATION FROM THE BRANCH MANAGER ORIENTAL BANK O F COMMERCE, MANDI GOBINDGARH. THERE WERE TWO CREDIT ENTRIES IN THE SAID BANK ACCOUNT OF RS.15 LACS EACH I.E. ONE DEPOSITED ON 3. 1.2007 AND THE SECOND DEPOSITED ON 31.1.2007. IN THE ABSENCE OF A NY EXPLANATION FILED BY THE ASSESSEE, THE SAID ENTRIES WERE TREATE D AS UNEXPLAINED AND ADDITION OF RS.30 LACS WAS MADE BY THE ASSESSIN G OFFICER. 5. BEFORE THE CIT(A) IN ADDITION TO RAISING THE PLE A AGAINST THE NON-SERVICE OF NOTICES UPON THE ASSESSEE U/SS 143(2 ) & 143(1) OF THE ACT AND EX-PARTE ORDER PASSED IN THE CASE, THE ASSE SSEE SOUGHT PERMISSION TO FURNISH ADDITIONAL EVIDENCE IN THE FO RM OF COPY OF THE ACCOUNT OF THE ASSESSEE IN THE BOOKS OF ACCOUNT OF M/S SARABH STEEL SALES. THE ASSESSEE EXPLAINED THAT A SUM OF RS.15 LACS WAS DEBITED 3 TO THE ACCOUNT OF THE ASSESSEE IN THE BOOKS OF ACCO UNT OF THE SAID CONCERN AND THE SAID CHEQUE WAS CREDITED IN THE BAN K ACCOUNT OF THE ASSESSEE. THEN CHEQUE OF EVEN AMOUNT WAS ISSUED IN FAVOUR OF M/S PATIALA ENTERPRISES, MANDI GOBINDGARH. THE SAID DE POSIT WAS WITHDRAWN FROM M/S PATIALA ENTERPRISES, MANDI GOBIN DGARH ON 30.1.2007 AND DEPOSITED IN THE BANK AND AGAIN CHEQU E OF RS.15 LACS WAS ISSUED IN FAVOUR OF M/S PATIALA ENTERPRISES, MA NDI GOBINDGARH. IT WAS FURTHER EXPLAINED THAT THE FIRST CHEQUE ISSU ED BY THE ASSESSEE IN FAVOUR OF M/S PATIALA ENTERPRISES, MANDI GOBINDG ARH, GOT BOUNCED AND ANOTHER CHEQUE OF THE SAME AMOUNT WAS I SSUED AND THUS THE CONTROVERSY WAS CONCERNING ONLY THE AMOUNT OF R S.15 LACS, THOUGH THE ASSESSING OFFICER HAD TAKEN THE AMOUNT T WICE OVER SINCE TWO DIFFERENCE CHEQUES WERE INVOLVED. THE SUBMISSI ONS OF THE ASSESSEE ARE INCORPORATED UNDER PARA 4.2 AT PAGES 2 TO 4 OF THE APPELLATE ORDER. THE SAID SUBMISSIONS WERE MADE AV AILABLE TO THE ASSESSING OFFICER AND THE REPORT OF THE ASSESSING O FFICER IS UNDER PARA 4.3 AT PAGES 4 TO 6 OF THE APPELLATE ORDER IN WHICH IT WAS SUBMITTED THAT THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE REQUIRES FRESH EXAMINATION. IN REJOINDER, THE ASSESSEE PLEA DED THAT IF THE ASSESSEE WAS NOT ALLOWED TO PROVE HIS CASE BY THE D OCUMENTS NOW FILED BEFORE THE CIT(A), IT WOULD BE DENIAL OF JUST ICE TO THE ASSESSEE. A REQUEST WAS MADE FOR THE ADMISSION OF THE ADDITIONAL EVIDENCE. THE REPLY OF THE ASSESSEE IS UNDER PARA 4.4 AT PAGE 7 OF THE APPELLATE ORDER. THE CIT(A) FORWARDED THE REJO INDER OF THE ASSESSEE TO THE ASSESSING OFFICER WHO FILED A REPOR T DATED 6.1.2001 AND MADE A REQUEST THAT SOME MORE TIME MAY BE GIVEN TO THE ASSESSING OFFICER TO COMMENT ON THE MERITS OF THE A DDITIONAL EVIDENCE AS THE INFORMATION WAS SOUGHT FROM THE MAN AGER, ORIENTAL 4 BANK OF COMMERCE, MANDI GOBINDGARH. THE ASSESSING OFFICER FURTHER VIDE HER REPORT DATED 15.2.2011 STATED AS U NDER : IN CONTINUATION TO THE EARLIER SUBMISSIONS SUBMITTED VIDE THIS OFFICE LETTER NO.1293 DATED 06/01/2011 IT IS SUBMITTED THAT INFORMATION CALLED FROM THE MANAGER ORIENTAL BANK OF COMMERCE MANDI GOBINDGARH REGARDING THE NAME AND ADDRESS OF THE PERSONS FROM WHOSE ACCOUNT RS.15 LACS HAS BEEN CREDITED TWO TIMES INTO THE ACCOUNT OF THE APPELLAN T SMT.NEETA RANI ON 31/01/2007 ALONG WITH NAME AND ADDRESS OF THE PERSONS IN WHOSE ACCOUNTS RS.15 LACS HAVE BEEN SENT FROM THE ACCOUNT OF THE APPELLANT SMT.NEETA RANI TWO TIMES ON 31/01/2007 HAS BEEN RECEIVED. THE PLEA OF THE ASSESSEE THAT AMOUNT OF RS.15 LACS WAS RECEIVED FROM SARABH STEELS ON 31/03/2007 & TRANSFERRED TO PATIALA ENTERPRISES ON SAME DATE, AN D AGAIN RECEIVED FROM PATIALA ENTERPRISES & AGAIN TRANSFERRED TO IT ON 31/01/2007 ITSELF SEEMS TO BE GENUINE. (COPY OF LETTER RECEIVED FROM OBC MANDI GOBINDGARH IS ENCLOSED). KEEPING IN VIEW IN THIS F ACT THE ADDITION MAY BE DECIDED ON THE BASIS OF THE EVI DENCE SUBMITTED BY THE BANK. 6. THE SAID REPORTS OF THE ASSESSING OFFICER ARE IN CORPORATED UNDER PARA 4.5 & 4.5.1 AT PAGE 8 & 9 OF THE APPELLA TE ORDER. THE CIT(A) THEREAFTER UPHELD THE EX-PARTE ASSESSMENT MA DE BY THE ASSESSING OFFICER IN VIEW OF THE NON-COMPLIANCE OF VARIOUS NOTICES ISSUED TO THE ASSESSEE. FURTHER EVEN THE ADDITIONA L EVIDENCE FILED BY THE ASSESSEE WAS NOT ADMITTED BY THE CIT(A) AS L ARGE NUMBER OF OPPORTUNITIES WERE ALLOWED TO THE ASSESSEE DURING A SSESSMENT PROCEEDINGS. 5 7. IN THE PRESENT APPEAL FILED BY THE ASSESSEE, THE GRIEVANCE OF THE ASSESSEE IS IN CONNECTION WITH THE ADMISSION AN D NON- ADJUDICATION OF CIT(A) ON THE ADDITIONAL EVIDENCE F ILED BY THE ASSESSEE DURING THE APPELLATE PROCEEDINGS. THE CIT (A) UNDER THE PROVISIONS OF SECTION 250 OF THE INCOME TAX ACT IS EMPOWERED TO CONSIDER THE APPLICATION MOVED BY THE ASSESSEE FOR ADMISSION OF ADDITIONAL EVIDENCE AND AFTER CONFRONTING THE SAID ADDITIONAL EVIDENCE TO THE ASSESSING OFFICER, DECIDE THE ISSUE ON MERITS OF THE CASE. THE POWERS OF CIT(A) ARE CO-TERMINUS WITH THA T OF ASSESSING OFFICER. IN THE FACTS OF THE PRESENT CASE BEFORE US, THE ASSESSEE HAD NOT APPEARED BEFORE THE ASSESSING OFFICER, THOUGH S EVERAL OPPORTUNITIES WERE AFFORDED TO THE ASSESSEE. THE E XPLANATION OF THE ASSESSEE IS THAT THE SAID NOTICES WERE NOT SERVED U PON THE ASSESSEE. BE THAT AS MAY BE, THE ASSESSEE HAD DURING THE COUR SE OF ASSESSMENT PROCEEDINGS MOVED AN APPLICATION FOR ADMISSION OF A DDITIONAL EVIDENCE IN THE FORM OF COPY OF ACCOUNT OF THE ASSE SSEE WITH ANOTHER CONCERN FROM WHICH A SUM OF RS.15 LACS WAS WITHDRAW N AND DEPOSITED IN THE BANK ACCOUNT OF THE ASSESSEE, WHIC H LATTER WAS ADVANCED TO ANOTHER CONCERN. THERE WERE TWO ENTRIE S OF CREDIT OF RS.15 LACS, ONE ON ACCOUNT OF AMOUNT WITHDRAWN FROM FIRST CONCERN AND THE SECOND ON ACCOUNT OF DISHONORING OF THE CHE QUE ISSUED BY THE ASSESSEE AND THEREAFTER ITS REVERSE CREDIT ENTR IES IN THE BANK ACCOUNT AND FURTHER ISSUE OF ANOTHER CHEQUE TO THE SECOND CONCERN BY THE ASSESSEE. THE ABOVESAID DOCUMENTS WERE CONF RONTED TO THE ASSESSING OFFICER DURING THE APPELLALTE PROCEEDING S AND ENQUIRIES WERE MADE BY THE ASSESSING OFFICER BY SEEKING INFOR MATION UNDER SECTION 133(6) OF THE INCOME TAX ACT FROM THE MANAG ER, ORIENTAL BANK OF COMMERCE, MANDI GOBINDGARH, VIS--VIS CREDI T ENTRIES IN 6 THE BANK ACCOUNT. IN THE REMAND REPORT DATED 15.2. 2011 THE ASSESSING OFFICER HAD ACCEPTED THE PLEA OF THE ASSE SSEE VIS--VIS THE AMOUNT OF RS.15 LACS BEING RECEIVED FROM M/S SARABH STEEL SALES ON 3.1.2007 AND ITS TRANSFER TO M/S PATIALA ENTERPRISE S, MANDI GOBINDGARH ON THE SAME DATE AND AGAIN RECEIVED FROM M/S PATIALA ENTERPRISES, MANDI GOBINDGARH AND ITS TRANSFER TO I T ON 31.1.2007. THE ASSESSING OFFICER HAD COMMENTED UPON THE SAID E NTRIES AND AFTER VERIFICATION HAD OBSERVED THAT THE SAID ENTRI ES SEEMS TO BE GENUINE AND COPY OF THE LETTER RECEIVED FROM ORIENT AL BANK OF COMMERCE, MANDI GOBINDGARH WAS ENCLOSED TO THE REMA ND REPORT DATED 15.2.2011. THOUGH THE ASSESSING OFFICER INIT IALLY WAS HESITANT IN ADMISSION OF ADDITIONAL EVIDENCE BUT IN THE LAST REMAND REPORT HAD ADMITTED THAT IN VIEW OF THE FACTUAL POS ITION THE ADDITION MAY BE DECIDED ON THE BASIS OF THE EVIDENCE SUBMITT ED BY THE BANK. IN VIEW OF THE ABOVESAID EVIDENCE AND ALSO THE REMA ND REPORT OF THE ASSESSING OFFICER DATED 15.2.2011 THE EXPLANATION F ILED BY THE ASSESSEE IN RESPECT OF TWO CREDIT ENTRIES OF RS.15 LACS EACH STANDS ESTABLISHED AND IN SUBSTANCE THE ASSESSEE HAD EXPLA INED THE SOURCE OF THE CREDIT ENTRIES IN THE BANK ACCOUNT DEPOSITED ON 3.1.2007 AND ON 31.1.2007. IN THE ENTIRETY OF THE ABOVESAID FAC TS AND CIRCUMSTANCES WE FIND NO MERIT IN THE ORDER OF THE CIT(A) IN REJECTING THE SAID ADDITIONAL EVIDENCE AND ALSO SUM MARILY DISMISSING THE REMAND REPORT FURNISHED BY THE ASSESSING OFFICE R IN THIS REGARD AND FAILING TO ADMIT THE ADDITIONAL EVIDENCE ON REC ORD. WE ARE OF THE VIEW THAT THE SAID ADDITIONAL EVIDENCE MERITS T O BE TAKEN ON RECORD ONCE THE EXPLANATION OF THE ASSESSEE HAS BEE N VERIFIED BY THE ASSESSING OFFICER AND EVEN THE BANK IN WHICH THE SA ID CREDIT ENTRIES WERE EXISTING HAD CONFIRMED THE NAME OF THE PARTIES , THERE WAS NO 7 MERIT IN UPHOLDING THE ADDITION OF RS.30 LACS. THE ASSESSEE HAVING EXPLAINED THE NATURE OF THE CREDIT ENTRIES IN THE B ANK ACCOUNT, WE DIRECT THE ASSESSING OFFICER TO DELETE THE ADDITION OF RS.30 LACS. IN VIEW OF OUR ALLOWING THE GROUND OF APPEAL ON MERITS OF THE ADDITION, WE RESTRAIN FROM ADDRESSING THE ISSUE RAISED IN GRO UND NO.1. ACCORDINGLY, GROUND NOS.2 & 3 RAISED BY THE ASSESSE E ARE ALLOWED. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 29 TH DAY OF JUNE, 2011 SD/- SD/- (D.K.SRIVASTAVA) (SUSHMA CHOWLA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 29 TH JUNE , 2011 RATI COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR TRUE COPY BY ORDER ASSISTANT REGISTRAR, ITAT, CHANDIGARH