K Premsagar Rao, Hyderabad V. Dy.CIT, Central Circle-2, Hyderabad

ITA 525/HYD/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 74681 (ITAT-HYDERABAD)
• Duration Of Justice: 10 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-03-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 15-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Search and seizure; Additional evidence
• Section: 143(3); 142(1); 153A; 132; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B : HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA.NO.525/HYD/2013 ASSESSMENT YEAR 2007-2008 MR. K. PREMSAGAR RAO HYDERABAD. PAN AHJPK 0776B VS. DCIT, C.C. 2 HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : -NONE- FOR REVENUE : MR. JEEVAN LAL LAVIDIYA DATE OF HEARING : 10.03.2014 DATE OF PRONOUNCEMENT : 12.03.2014 ORDER PER B. RAMAKOTAIAH, A.M. THIS IS AN ASSESSEES APPEAL AGAINST THE ORDER OF THE CIT(A)-I, HYDERABAD DATED 31.01.2013 FOR THE A. Y. 2007- 2008. 2. WHEN THE CASE WAS CALLED NONE APPEARED FOR THE ASSESSEE AND IT SEEMS THAT IN EARLIER TWO OCCASIONS ALSO NONE APPEARED, EVEN THOUGH THERE WAS A POWER OF ATTORNEY FILED IN THE NAME OF ONE MR. SREEDHAR. IN VIEW OF THIS, WE H AVE CONSIDERED THE ASSESSEES APPEAL EXPARTE WITHOUT PR ESENCE OF THE ASSESSEE OR HIS REPRESENTATIVE, AFTER HEARING T HE LEARNED D.R. 2.1. THE ISSUE IN THIS APPEAL IS WITH REFERENCE TO THE ADDITION OF RS. 25 LAKHS STATED TO HAVE BEEN RECEIV ED AS 2 ITA.NO.525/HYD/2013 MR. K. PREMSAGAR RAO, HYD. UNSECURED LOAN BUT TREATED AS UNEXPLAINED CASH CRED IT. THERE WAS A SEARCH AND SEIZURE OPERATION UNDER SECTION 13 2 CARRIED OUT IN THE RESIDENCE OF THE ASSESSEE ON 17.03.2009. NOTICE UNDER SECTION 153A WAS ISSUED ON 03.12.2009 AND ASS ESSEE FILED RETURN OF INCOME ON 01.02.2010 ADMITTING TOTA L INCOME OF RS.32,20,950/-. IN THE COURSE OF ASSESSMENT PROCEED INGS, SINCE ASSESSEE HAS NOT APPEARED FROM TIME TO TIME, A.O. PROPOSED TO COMPLETE THE ASSESSMENT INVOKING PROVIS IONS OF SECTION 144 BY A SHOW CAUSE NOTICE DATED 19.11.2010 . IN REPLY, ASSESSEE FURNISHED WRITTEN SUBMISSIONS AND STATED T HAT SCRUTINY ASSESSMENTS WERE ALREADY COMPLETED UNDER S ECTION 143(3) AND HENCE RETURN FILED BY HIM MAY BE ACCEPTE D. A.O., HOWEVER, WANTED THE ASSESSEE TO FURNISH CONFIRMATIO N LETTER FROM M/S. GEHANA PROJECTS P. FROM WHERE ASSESSEE W AS IN RECEIPT OF UNSECURED LOAN OF RS. 25 LAKHS. ON 25.11 .2010 ASSESSEE INFORMED THAT HE WOULD BE FILING THE CONFI RMATION LETTER WITHIN A WEEKS TIME. HOWEVER, ON 26.11.2010 ASSESSEE WAS ISSUED A NOTICE UNDER SECTION 142(1) AND SERVED ON THE ASSESSEE ON 29.11.2010. SINCE THE ASSESSEE HAS NOT APPEARED NOR FURNISHED THE CONFIRMATION LETTER, A.O. TREATED THE AMOUNT OF RS. 25 LAKHS AS UNEXPLAINED CASH CREDIT AND BROU GHT TO TAX. 3. BEFORE THE LD. CIT(A), ASSESSEE CONTENDED THAT ASSESSMENT WAS COMPLETED UNDER SECTION 143(3) ON 03.09.2008 ACCEPTING THE INCOME RETURNED AND CONSEQ UENT TO THE SEARCH AND SEIZURE OPERATIONS, THE CASE WAS NOT IFIED AND NOTICE UNDER SECTION 153A WAS RECEIVED. IN RESPONSE , ASSESSEE FILED ADMITTING TOTAL INCOME OF RS.32,90,732/- AS O RIGINALLY FILED AND A.O. WITHOUT GIVING SUFFICIENT OPPORTUNIT Y TO THE ASSESSEE BROUGHT THE UNSECURED LOAN AS UNEXPLAINED CASH 3 ITA.NO.525/HYD/2013 MR. K. PREMSAGAR RAO, HYD. CREDIT. ASSESSEE FURNISHED CONFIRMATION LETTER FROM M/S. GEHANA PROJECTS P. LTD. BEFORE CIT(A). HOWEVER, THE LD. CIT(A) DID NOT ADMIT THE ADDITIONAL EVIDENCE AS THE SAME H AS NOT BEEN FILED BEFORE THE A.O. HE ALSO OPINED THAT EVIDENCE BEING TENDERED IS NOT SUFFICIENT EVEN ON MERITS, WITHOUT DISCUSSING THE DEFICIENCY IN THE CONFIRMATION LETTER. HE CONFI RMED THE ADDITION. HENCE THE PRESENT APPEAL. 4. THE ASSESSEE HAS RAISED GROUNDS MAINLY STATING THAT A.O. HAS NOT GIVEN ENOUGH OPPORTUNITY NOR THE ADDITIONAL EVIDENCE WAS ADMITTED BY THE LD. CIT(A). HE ALSO CO NTENDED THAT CIT(A) SHOULD HAVE ACCEPTED THE ASSESSEES PLE A THAT ADDITION ON IMPUGNED AMOUNT IS INVALID. 5. CONSIDERING THE GROUNDS AND AFTER HEARING LEARN ED D.R. WE ARE OF THE OPINION THAT THE MATTER SHOULD B E REMITTED TO THE FILE OF THE A.O. TO EXAMINE THIS ISSUE AFRES H. EVEN THOUGH THE A.O. STATES THAT THERE IS NO SCRUTINY ASSESSMEN T UNDER SECTION 143(3) CARRIED OUT EARLIER, ASSESSEE SPECIF ICALLY SUBMITTED BEFORE THE CIT(A) THAT THERE WAS SCRUTINY ASSESSMENT AND ONCE SUCH SCRUTINY ASSESSMENT HAS BE EN COMPLETED, MAKING ADDITION UNDER SECTION 153A REQUI RES INCRIMINATING MATERIAL, AS PER THE NEW PROCEDURE OF ASSESSMENT. BE THAT AS IT MAY, WE ARE OF THE OPINIO N THAT A.O. HAS ACTED IN A HASTE WHEN ASSESSEE WANTED TIME TO S UBMIT CONFIRMATION LETTER. WHEN ASSESSEE SUBMITTED THE CO NFIRMATION LETTER BEFORE THE CIT(A) ATLEAST, CIT(A) SHOULD HAV E ADMITTED THE EVIDENCE AND COULD HAVE EXAMINED THE ISSUE, AS THIS IS A SEARCH AND SEIZURE CASE AND PROCEEDINGS ARE UNDER S ECTION 153A. IN VIEW OF THIS, WE HAVE NO HESITATION IN SET TING ASIDE THE ORDER OF THE CIT(A) AND THE ORDER OF THE A.O. ON TH IS ISSUE AND 4 ITA.NO.525/HYD/2013 MR. K. PREMSAGAR RAO, HYD. RESTORE THE MATTER TO THE FILE OF THE A.O. FOR FRES H EXAMINATION. ASSESSEE SHOULD BE GIVEN DUE OPPORTUNITY TO EXPLAIN THE LOAN. ASSESSEE IS FREE TO RAISE ANY LEGAL CONTENTIONS IN THE COURSE OF ASSESSMENT PROCEEDINGS. WITH THESE OBSERVATIONS, GR OUNDS RAISED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 12.03.2014. SD/- SD/- (SAKTIJIT DEY) (B. RAMAKOTAIAH) JUDICIAL MEMBER ACOUNTANT MEMBER HYDERABAD, DATED 12 TH MARCH, 2014 VBP/- COPY TO : 1. MR. K. PREMSAGAR RAO, 1-8-505, PRAKASH NAGAR, BEGU MPET, HYDERABAD. 2. DCIT, CENTRAL CIRCLE-2, HYDERABAD. 3. CIT(A)-I, HYDERABAD. 4. CIT, (CENTRAL), HYDERABAD 5. D.R. ITAT, B BENCH, HYDERABAD.