M/s. Raj Hans Towrs Pvt. Ltd., New Delhi V. DCIT, New Delhi

ITA 5240/DEL/2012

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 6875 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 9 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-07-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 06-06-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 10-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V P MISHRA
• Keywords: Unexplained cash credit; Principle of natural justice
• Section: 143(3); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : F NEW DELHI BEFORE SMT. DIVA SINGH , JUDICIAL M EMBER AND SH. O.P. KANT , ACCOUNTANT MEMBER ITA NO. 5240 /DEL/ 2012 ASSESSMENT YEAR: 2009 - 10 M/S. RAJ HANS TOWERS PVT. LTD., M - 33, 2 ND FLOOR, GREATER KAILASH - I, NEW DELHI VS. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE - 15(1), NEW DELHI GIR/PAN : AAACR0019H (APPELLANT) (RESPONDENT) APPELLANT BY SH. R.S. SINGHVI, CA RESPONDENT BY SH. V.P. MISHRA, SR.DR DATE OF HEARING 06.06.2016 DATE OF PRONOUNCEMENT 20.07.2016 ORDER PER O.P. KANT , A. M. : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST O RDER DATED 14/09/2012 OF LEARNED COMMISSIONER OF INCOME - TAX ( APPEALS) - XVIII, NEW DELHI FOR ASSESSMENT YEAR 2009 - 10 RAISING FOLLOWING GROUNDS: I. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED ON FACTS AND UNDER THE LAW IN CONFIRMING ADDITION OF RS. 10,00,000/ - U/S. 68 IN RESPECT OF LOAN TAKEN FROM M/S. BELIEF CHIT FUND PVT. LTD., WHICH WAS 2 ITA NO. 5240/DEL/2012 AY: 2009 - 10 WRONGLY REFERRED TO BY ASSESSING OFF ICER IN THE ASSESSMENT ORDER AS M/S. BELIEF PVT. LTD. II. THAT CIT(A) HAS TOTALLY DISREGARDED THE FACT THAT GENUINENESS OF LOAN IS CORROBORATED FROM AUDITED BALANCE SHEET AND ASSESSMENT ORDER PASSED IN THE CASE OF M/S. BELIEF CHIT FUND PVT. LTD. U/S. 143(3) FOR THE VERY SAME ASSESSMENT YEAR AND AS SUCH THERE IS NO CASE OF ANY DOUBT OR DISPUTE ABOUT GENUINENESS OF SUCH LOAN. III. THAT THE CIT(A) HAS CONSIDERED VARIOUS GROUND AND EVIDENCES IN HIGHLY ARBITRARY AND PREJUDICIAL MANNER WITHOUT PROPER APPRECIATION OF FACTS AND OPPORTUNITY TO THE APPELLANT. IV. THAT SPECIFIC GROUND REGARDING CROSS EXAMINATION OF SH. S.K. GUPTA WAS NOT CONSIDERED AND ADJUDICATED UPON AND EVEN THE FACT THAT ALLEGED STATEMENT IS OF NO RELEVANCE TO THE CASE OF THE APPELLANT WAS NOT TAKEN NOTE OF. V. THAT CIT(A) HAS MADE REFERENCE TO VARIOUS CASE LAWS WHICH HAVE NO RELEVANCE OR BEARING TO THE FACTS OF THE CASE UNDER REFERENCE AND ON THE CONTRARY THE CLAIM OF THE APPELLANT IS SUPPORTED FROM DECISION OF SUPREME COURT IN THE CASE OF ORISSA CORPORATIO N PVT. LTD. 159 ITR 78 AND VARIOUS DOCUMENTARY EVIDENCES PLACED ON RECORD. VI. THAT THE ORDERS OF THE LOWER AUTHORITIES ARE NOT JUSTIFIED ON FACTS AND SAME ARE BAD IN LAW. 2. T HE FACTS IN BRIEF ARE THAT THE ASSESSEE FILED ITS RETURN OF INCOME ON 30/09/2010 D ECLARING TOTAL INCOME OF RS. 1,23,95, 190/ - . THE ASSESSEE COMPANY WAS ENGAGED IN THE BUSINESS OF REAL ESTATE DURING RELEVANT PERIOD. DURING THE SCRUTINY ASSESSMENT, THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE COMPANY RECEIVED RS. 10 LACS FROM M/S BELI EF PRIVATE 3 ITA NO. 5240/DEL/2012 AY: 2009 - 10 L IMITED, WHICH WAS A COMPANY OPERATED BY SH . S . K . GUPTA. FURTHER, THE ASSESSING OFFICER NOTED THAT IN THE COURSE OF SURVEY PROCEEDING AT THE PREMISES OF SH. S.K. GUPTA, HE ADMITTED OF HAVING ENGAGED IN PROVIDING ACCOMMODATION ENTRY T H R O U G H COMPANIES MAINTA INED AND OPERATED BY HIM. IN THE SCRUTINY ASSESSM ENT COMPLETED UNDER SECTION 143 (3) OF THE ACT ON 28/12/2011, THE ASSESSING OFFI CER HELD THAT AMOUNT OF RS. 10 L ACS RECEIVED FROM M/S . BELIEF PRIVATE L IMITED WAS IN THE NATURE OF AN ACCOMMODATION ENTRY AND ACCORDINGLY HE MADE AN ADDITION OF RS. 10 LAKH AS UNEXPLAINED CASH CREDIT UNDER SECTION 68 OF THE INCOME - TAX ACT (FOR SHORT THE ACT ) . AGGRIEVED, THE AS SESSEE FILED AN APPEAL BEFORE THE LEARNED COMMISSIONER OF INCOME - TAX ( APPEALS) AND RAISED GROUNDS INCLUDING THE GROUND THAT COPY OF STATEMENT OF SH. S .K. GUPTA WAS NOT PROVIDED TO THE ASSESSEE FOR CLARIFICATION AND CROSS - EXAMINATION. THE LEARNED COMMISSIONER OF INCOME - TAX ( APPEALS) IN THE IMPUGNED ORDER CONFIRMED THE ADDITION MADE BY THE ASSESSING OFFI CER. AGGRIEVED , THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL RAISING THE GROUNDS A S REPRODUCED ABOVE. 3. IN GROUND NO. 1(IV), THE ASSESSEE HAS RAISED THAT LEARNED COMMISSIONER OF INCOME - TAX ( APPEALS) HAS NOT ADJUDICATED UPON THE GROUND OF THE ASSESS EE SE EKING CROSS - EXAMINATION OF SH . S . K . GUPTA. IN GROUND NO. 1(III) , ALSO THE ASSESSEE HAS RAISED THE ISSUE THAT THE LEARNED COMMISSIONER OF INCOME - TAX ( APPEALS) HAS DECIDED APPEAL WITHOUT PROPER APPRECIATION OF FACTS AND OPPORTUNITY TO THE ASSESSEE. 4 ITA NO. 5240/DEL/2012 AY: 2009 - 10 3.1 BEF ORE US, THE LEARNED AUTHORIZED R EPRESENTATIVE OF THE ASSESSEE ADDRESSING THE GROUNDS RAISED SUBMITTED THAT ALL THE DOCUMENTARY EVIDENCE S IN SUPPORT OF IDENTITY AND CREDITWORTHINESS OF THE CREDITOR AND, GENUINENESS OF THE TRANSACTION WERE DULY PRODUCED BEFO RE THE ASSESSING OFFICER AND THERE WAS NO REASON TO RELY ON THE STATEMENT OF SH S . K . GUPTA WITHOUT ANY CORROBORATIVE EVIDENCE. IT WAS ALSO SUBMITTED THAT THE MONEY WAS RECEIVED THROUGH NORMAL BANKING CHANNEL AND THE CRE DITOR WAS ALSO ASSESSED BY THE I NCOM E TAX DEPARTMENT . FURTHER , HE SUBM ITTED THAT THE ASSESSEE WAS NOT PROVIDED THE OPPORTUNITY TO CROSS - EXAMINE SH . S . K . GUPTA. 3.2 THE LEARNED SENIOR DEPARTMENTAL R EPRESENTATIVE SUPPORTED THE ORDER OF THE LOWER AUTHORITIES, HOWEVER , COULD NOT CONTROVERT THE FACT THAT THE ASSESSEE HAS NOT BEEN PROVIDED OPPORTUNITY TO CROSS - EXAMINE SH. S . K . GUPTA, RELYING ON WHOSE STATEMENT , THE ASSESSING OFFICE R HELD THE AMOUNT RECEIVED FROM M/S . BELIEF PRIVATE L IMITED AS UNEXPLAINED CASH CREDIT. 3.3 WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE FACT THAT THE ASSES SEE SOUGHT CROSS - EXAMINATION OF SH . S . K . GUPTA IN ITS GROUNDS RAISED BEFORE THE LEARNED COMMISSIONER OF INCOME - TAX ( APPEALS), IS NOT IN DISPUTE. THE LEARNED CO MMISSIONER OF INCOME - TAX (APPEALS) REPRODUCED GROUNDS OF THE ASSESSEE IN THE IMPUGNED ORDER AND ONE OF THE GROUND S SEEKING CROSS - EXAMINATION IS AS UNDER: 5 ITA NO. 5240/DEL/2012 AY: 2009 - 10 2(I) THAT REFERENCE TO STATEMENT OF SH. S.K. GUPTA IS HIGHLY ARBITRARY AND IRRELEVANT AND COPY OF N O SUCH STATEMENT HAS BEEN PROVIDED FOR CLARIFICATION AND CROSS EXAMINATION. 3.4 T HE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) RELYING ON THE JUDGMENT OF THE HON BLE DELHI HIGH COURT IN THE C ASE OF INDUS VALLEY P ROMOTERS LTD . VS. COMMISSIONER OF INCOME T AX (2008) 305 ITR 202, JUDGMENT OF THE HON BLE SUPREME COURT IN THE CASE OF COMMISSIONER OF INCOME T AX VS. P . MOHANAKALA , 291 ITR 278 AND THE JUDGMENT OF THE HON BLE DELHI HIGH COURT IN TH E CASE OF COMMISSIONER OF INCOME T AX VS. NOVA PROMOTERS AND FINLEASE PRIVATE L IMITED , (2012) 342 ITR 169 , CONFIRMED THE ADDITIONS WITH FOLLOWING OBSERVATIONS: THE APPELLANT HAS THUS BEEN UNABLE TO EXPLAIN THE IDENTITY, GENUINENESS AND CREDITWORTHINESS OF THE PERSON WHO HAS ALLEGEDLY GIVEN THE AMOUNTS. AS THE EXPLA NATION OFFERED BY THE ASSESSED ABOUT THE NATURE AND SOURCE OF THE SUMS FOUND CREDITED IN THE | BOOKS WAS NOT SATISFACTORY THERE WAS, PRIMA FACIE, EVIDENCE AGAINST THE ASSESSEE, VIZ., THE RECEIPT OF MONEY. THE BURDEN WAS ON THE ASSESSEE TO REBUT THE SAME, A ND, IT FAILED TO REBUT IT, IT CAN THEREFORE BE HELD AGAINST THE ASSESSEE THAT IT WAS A RECEIPT OF AN INCOME NATURE. THE APPELLANT HAS FAILED TO DISCHARGE ITS ONUS TO PRODUCE LEGALLY ACCEPTABLE EVIDENCE OF CREDITWORTHINESS OF THE PERSON. THE EXPRESSION THE ASSESSEE OFFERS NO EXPLANATION' MEANS THE ASSESSEE OFFERS NO PROPER, REASONABLE AND ACCEPTABLE EXPLANATION AS REGARDS THE SUMS FOUND CREDITED IN THE BOOKS MAINTAINED BY THE ASSESSEE. IN THIS CASE THE APPELLANT HAS OFFERED NO CREDITABLE EXPLANATION ABOUT T HE AMOUNTS CREDITED IN HIS BOOKS, THE RECEIPT OF RS. 10 LACS THEREFORE CANNOT BE TREATED AS EXPLAINED. CONSIDERING THE ABOVE FACTS, THE ADDITION OF RS. 10,00,000/ - MADE BY THE AO U/S 68 IS CONFIRMED. 6 ITA NO. 5240/DEL/2012 AY: 2009 - 10 3.5 FROM THE IMPUGNED ORDER , WE FIND THAT THE LEARNED COMMISSIONER OF INCOME - TAX ( APPEALS) HAS NOT DECIDED THE GROUND SEEKING STATEMENT AND CROSS - EXAMINATION OF SH . SK GUPTA. WE FIND THAT IN THE CASE OF CIT VS. KAMDHENU STEEL & ALLOYS LTD. & ORS REPORTED IN 361 ITR 220, THE HON BLE DELHI HIGH COURT HAS HELD T HAT NOT PROVIDING OPPORTUNITY OF CROSS - EXAMINATION OF WITNESS IS A VIOLATION OF PRINCIPLE OF NATURAL JUSTICE AND UPHELD THE ACTION OF THE TRIBUNAL IN REMITTING THE MATTER TO THE ASSESSING OFFICER. THE RELEVANT FINDING OF THE HON BLE DELHI HIGH COURT IS REP RODUCED AS UNDER: 55 . IN OUR DISCUSSION ON THE ASPECT OF REMAND IN IT APPEAL NO. 972 OF 2009, WE HAVE INDICATED THAT IF THE ADDITION IS SET ASIDE ONLY BECAUSE OF SOME PROCEDURAL DEFECT OR IRREGULARITY, VIZ., VIOLATION OF PRINCIPLE OF NATURAL JUSTICE, THEN MATTER CAN BE REMITTE D BACK TO GIVE OPPORTUNITY TO THE ASSESSEE TO CROSS - EXAMINE THE WITNESS IF IT WAS NOT DONE. THE CLINCHER ON THIS ASPECT IS NOW THE ORDER OF THE SUPREME COURT IN THE CASE OF ITO VS. M. PIRAI CHOODI (CIVIL APPEAL NOS. 9756 & 9757 OF 2010, DECIDED ON 19TH NOV ., 2010 [REPORTED AT (2011) 245 CTR (SC) 233 : (2011) 63 DTR (SC) 187 ED.] WHERE THE COURT HELD AS UNDER : 'HEARD LEARNED COUNSEL ON BOTH SIDES. LEAVE GRANTED. IN THIS CASE, THE HIGH COURT HAS SET ASIDE THE ORDER OF ASSESSMENT ON THE GROUND THAT NO OPPORTU NITY TO CROSS - EXAMINE WAS GRANTED, AS SOUGHT BY THE ASSESSEE. WE ARE OF THE VIEW THAT THE HIGH COURT SHOULD NOT HAVE SET ASIDE THE ENTIRE ASSESSMENT ORDERS. AT THE HIGHEST, THE HIGH 7 ITA NO. 5240/DEL/2012 AY: 2009 - 10 COURT SHOULD HAVE DIRECTED THE AO TO GRANT AN OPPORTUNITY TO THE ASSESSEE TO CROSS - EXAMINE THE CONCERNED WITNESS. BE THAT AS IT MAY, WE ARE OF THE VIEW THAT, EVEN ON THIS PARTICULAR ASPECT, THE ASSESSEE COULD HAVE GONE IN APPEAL TO CIT(A). THE ASSESSEE HAS FAILED TO AVAIL THE STATUTORY REMEDY. IN THE CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE HIGH COURT SHOULD NOT HAVE QUASHED THE ASSESSMENT PROCEEDINGS VIDE IMPUGNED ORDER. CONSEQUENTLY, THE IMPUGNED ORDER IS SET ASIDE. LIBERTY IS GRANTED TO THE ASSESSEE TO MOVE CIT(A). IT IS MADE CLEAR THAT THE ASSESSEE HEREIN WILL MOVE THE CIT( A) WITHIN A PERIOD OF SIX WEEKS FROM TODAY.' 56. ACCORDINGLY, WE FIND NOTHING WRONG IN THE APPROACH OF THE TRIBUNAL IN REMITTING THE CASE BACK TO THE AO IN THE INSTANT CASE. THIS APPEAL IS ACCORDINGLY DISMISSED. 3.6 IN VIEW OF JUDICIAL PRECEDENT AS MENTIONED ABOVE AND THE FACT THAT THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS OMITTED TO ADJUDICATE ONE OF THE GROUND S OF THE ASSESSEE AS ALSO THE GRIEVANCE OF THE ASSESSEE OF NOT PROVIDING PROPER OPPORTUNITY BY THE LEARNED COMMISSIONER OF INCOME - TAX ( APPEALS), WE FEEL IT APPROPRIATE TO RESTORE THE MATTER BACK TO THE FILE OF THE LEARNED COMMISSIONER OF INCOME - TAX ( APPEALS) FOR ADJUDICATING AFRESH WITH THE DIRECTION TO PROVIDE SUFFICIENT OPPORTUNITY OF HEARING TO THE ASSESSEE A ND ALSO TO PROVIDE OPPORTUNITY OF CROSS - EXAMINATION OF SH . S . K . GU PTA, RELYING ON WHOSE STATEMENT , THE ASSESSING OFFICER HAS HELD THE AMOUNT OF RS. 10 LACS RECEIVED FROM M/S BELIEF PRIVATE L IMITED AS UNEXPLAINED CASH CREDIT. T HUS , GROUND S NO. 1(III) AND 1(I V) ARE ALLOWED FOR STATISTICAL PURPOSE S . 8 ITA NO. 5240/DEL/2012 AY: 2009 - 10 4. SINCE THE APPEAL HAS ALREADY BEEN RESTORED TO THE FILE OF THE LEARNED COMMISSIONER OF INCOME - TAX ( APPEALS) FOR DECIDING AFRESH, WE ARE NOT ADJUDICATING UPON OTHER GROUNDS RAISED BY THE ASSESSEE. 5. ACCORDINGLY , THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. THE DECISION IS PRONOUNCED IN THE OPEN COURT ON 2 0 T H JULY , 2016 . S D / - S D / - ( DIVA SINGH ) ( O.P. KA NT) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 2 0 T H JULY , 2016 . LAPTOP / - COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI