Sh. Narinder Kumar, Ambala V. ITO, Ambala

ITA 526/CHANDI/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 6568 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 7 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-12-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 09-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Assessee Lawyers: KULDEEP DHIMAN
• Keywords: Principle of natural justice
• Section: 131

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES B, CHANDIGARH BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER & MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA NO. 526/CHD/2016 ASSESSMENT YEAR: 2011-12 SH. NARINDER KUMAR, VS. THE ITO, WARD-3, S/O SH. MAM RAJ, GANESH VIHAR, AMBALA NEW DURGA NAGAR, SAHA DISTT. AMBALA PAN NO. ARHPK1986D (APPELLANT) (RESPONDENT) APPELLANT BY : SH. KULDEEP DHIMAN RESPONDENT BY : SH. MANJIT SINGH DATE OF HEARING : 14.12.2017 DATE OF PRONOUNCEMENT : 14.12.2017 ORDER PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSESS EE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS), [HEREINAFTER REFERRED TO AS CIT(A)], PANCHKULA DATED 29.02.2016. THE AS SESSEE THROUGH HIS GROUNDS OF APPEAL HAS AGITATED THE ACTION OF THE CI T(A) IN CONFIRMING THE ADDITION OF RS. 34,60,000/- OUT OF THE ADDITION OF RS. 53,67,000/- MADE BY THE ASSESSING OFFICER. 2 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSI NG OFFICER FOUND THE DEPOSIT OF RS. 53,76,000/- IN THE ACCOUNTS OF THE A SSESSEE. ON BEING ASKED TO EXPLAIN IN THIS RESPECT, THE ASSESSEE EXPLAINED THAT APART FROM ITS BUSINESS OF RUNNING A GYM, THE ASSESSEE WAS ALSO WO RKING AS AN AGENT OF A COMPANY WHICH WAS INVOLVED IN SORT OF BANKING / FIN ANCIAL BUSINESS WHEREBY THE COMPANY HAD APPOINTED AGENTS TO COLLECT DEPOSITS FROM THE PUBLIC WITH A PROMISE OF HIGH RETURNS IN THE SHAPE OF GOLD COINS. THE ASSESSEE COLLECTED THE DEPOSITS FROM THE PUBLIC, DE POSITED THE SAME INTO HIS ACCOUNT AND FURTHER REMITTED THE SAME TO THE SAID C OMPANY NAMELY MANHATTAN BUILDCON PVT. LTD. THE ASSESSEE ALSO PROD UCED CERTAIN WITNESSES TO SUPPORT HIS CLAIM. HOWEVER, THE ASSESSING OFFIC ER WAS NOT SATISFIED WITH THE EVIDENCE FILED BY THE ASSESSEE AND HE MADE ADDITION OF RS. 53.76 LACS. 3. IN APPEAL BEFORE CIT(A), THE ASSESSEE HAS SUBMIT TED THAT HE HAD SUBMITTED THE EVIDENCES TO PROVE HIS CASE BUT THE A SSESSING OFFICER IGNORED THE SAME WHEREUPON THE LD. CIT(A) HAS CALLED FOR RE MAND REPORT FROM THE ASSESSING OFFICER. THE ASSESSING OFFICER DURING REM AND PROCEEDINGS EXAMINED THE WITNESSES FURNISHED BY THE ASSESSEE AN D WAS SATISFIED SO FAR AS THE DEPOSITS OF RS. 19.07 LACS WAS CONCERNED. HOWEVER, THE ASSESSING OFFICER DID NOT FIND SUBSTANCE IN THE EVIDENCE RELA TING TO THE REMAINING AMOUNT OF THE DEPOSITS. THE MAIN AMOUNT OF RS. 25 LACS WAS ALLEGEDLY GOT BY THE ASSESSEE FROM ONE SHRI RAJPINDER SINGH. THE ASSESSEE HAD FILED AN AFFIDAVIT OF SAID SHRI RAJPINDER SINGH, WHEREIN HE HAD AFFIRMED THAT HE HAD PAID / DEPOSITED A SUM OF RS. 25 LACS INTO THE ACCO UNT OF THE ASSESSEE. FURTHER, DURING HIS STATEMENT RECODED BEFORE THE AS SESSING OFFICER, HE 3 DENIED THE SAID DEPOSITS OF RS. 25 LACS AND STATED THAT ONLY RS. 3 LAKHS WERE PAID BY HIM TO THE ASSESSEE. THE ASSESSING OFF ICER ALSO FOUND THAT THE ASSESSEE COULD NOT GIVE APPROPRIATE AND RELEVANT EV IDENCE OF THE REMAINING DEPOSITS OF RS. 12.60 LACS. 4. ACTING UPON THE ABOVE REPORT OF THE ASSESSING OF FICER, THE LD. CIT(A) CONFIRMED THE ADDITION OF RS. 34.60 LACS. 5. BEFORE US, LD. AR OF THE ASSESSEE HAS SUBMITTED THAT THE AMOUNT OF RS. 25 LACS WAS RECEIVED FROM SHRI RAJPINDER SINGH ONLY, WHO HAD DULY EXECUTED AN AFFIDAVIT IN THIS RESPECT WHEREIN HE HA D AFFIRMED THE PAYMENT OF RS. 25 LAKHS TO THE ASSESSEE. HE HAS FURTHER SUB MITTED THAT STATEMENT OF SHRI RAJPINDER SINGH WAS RECORDED BY THE ASSESSING OFFICER AT THE BACK OF THE ASSESSEE WITHOUT GIVING AN OPPORTUNITY TO THE A SSESSEE TO CROSS EXAMINE HIM. THE LD. COUNSEL HAS INVITED OUR ATTENTION TO P AGE 26 OF THE PAPER BOOK WHICH IS THE COPY OF THE SUMMONS ISSUED U/S 131 TO SHRI RAJPINDER SINGH, WHEREIN HE WAS CALLED UPON TO ATTEND TO THE PROCEED INGS BEFORE THE ASSESSING OFFICER ON 15.10.2015 WHEREAS THE COPY OF THE STATEMENT PLACED ON RECORD AT PAGE 27 OF THE PAPER BOOK SHOWS THAT T HE STATEMENT OF SHRI RAJPINDER SINGH WAS RECORDED BY THE ASSESSING OFFIC ER ON 13.10.2015, IN THE ABSENCE OF THE ASSESSEE. THE LD. COUNSEL FOR EH ASSESSEE HAS RELIED UPON THE DECISION OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF R.W. PROMOTERS V ACIT ITA NO. 1489 OF 2013 ORDER DATE D 13.7.2015 , WHEREIN THE HON'BLE HIGH COURT HAS HELD THAT THE ASSESSEE W AS ENTITLED TO CROSS EXAMINE THE WITNESS BEFORE ANY RELIANCE COULD BE PL ACED UPON THEM TO THE EXTENT IT WAS ADVERSE TO THE ASSESSEE. NON-GIVING O F OPPORTUNITY TO CROSS EXAMINE THE WITNESSES WHOSE STATEMENTS HAS BEEN RE LIED UPON BY THE REVENUE, AMOUNT TO BREACH OF PRINCIPLES OF NATURAL JUSTICE. THE LD. 4 COUNSEL HAS FURTHER RELIED ON THE DECISION OF HON'B LE PUNJAB & HARYANA HIGH COURT IN CIT VS. SANJEEV KUMAR JAIN, ITA NO. 638 OF 2007 WHEREIN THE STATEMENT OF THE WITNESSES WAS RECORDED AT THE BACK OF THE ASSESSEE, IT WAS HELD THAT IT WAS IMPERATIVE ON THE ASSESSING OF FICER TO GIVE OPPORTUNITY TO THE ASSESSEE TO CROSS EXAMINE SUCH P ERSONS. SO FAR AS THE ADDITION RELATING TO REMAINING AMOUNT OF RS. 12.60 LACS IS CONCERNED, THE LD. COUNSEL HAS SUBMITTED THAT THE CASH FLOW STATEM ENT WAS GIVEN TO THE ASSESSING OFFICER SHOWING THAT THE SAID AMOUNT WAS DEPOSITED OUT THE WITHDRAWALS MADE FROM THE SAME BANK ACCOUNT BUT BOT H THE LOWER AUTHORITIES HAVE FAILED TO LOOK THIS ASPECT OF THE MATTER. 6. CONSIDERING THE ABOVE SUBMISSIONS, WE FIND MERIT IN THE CONTENTIONS OF THE LD. AR. IT IS PROVED ON THE FILE THAT THE S TATEMENT OF SHRI RAJPINDER SINGH WAS RECORDED AT THE BACK OF THE ASSESSEE AND ON A DAY PRIOR TO THE DATE FIXED FOR THE STATEMENT. FURTHER, THE CONTENTI ON OF THE ASSESSEE REGARDING DEPOSITS FROM WITHDRAWALS MADE FROM SAME ACCOUNT HAS ALSO NOT BEEN EXAMINED. WE AGREE WITH THE CONTENTION OF THE LD. AR THAT THE ASSESSEE SHOULD BE GIVEN AN OPPORTUNITY TO CROSS EX AMINATION THE WITNESS AND TO DEMONSTRATE BEFORE THE ASSESSING OFFICER THA T THE REMAINING AMOUNT WAS OUT OF WITHDRAWALS FROM THE BANK. IN VIEW OF TH IS, THE IMPUGNED ORDER OF THE CIT(A) IS HEREBY SET ASIDE AND THE MATTER IS REMANDED TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO GIVE OPPO RTUNITY TO THE ASSESSEE TO PRESENT ITS CASE. THE ASSESSING OFFICER WILL GIVE O PPORTUNITY TO THE ASSESSEE TO CROSS EXAMINE SHRI RAJPINDER SINGH AND HE WILL M AKE EFFORT TO ENSURE THE PRESENCE OF SHRI RAJPINDER SINGH BY USING HIS P OWERS AS HE MAY DERIVE FROM THE RELEVANT PROVISIONS OF THE ACT. THE ASSES SING OFFICER WILL 5 EXAMINE THE REMAINING CONTENTIONS OF THE ASSESSEE A ND WILL PASS A SPEAKING ORDER AS PER PROVISIONS OF LAW. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (ANNAPURNA GUPTA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 14.12.2017 RKK COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR