Mr.Subramanian S, Trivandrum V. The ACIT, Trivandrum

ITA 529/COCH/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 5999 (ITAT-COCHIN)
• Duration Of Justice: 1 year(s) 2 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-02-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 12-02-2020
• Assessment Year: 2009-2010
• Appeal Filed On: 21-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MRITUNJAYA SHARMA
• Assessee Lawyers: ARYA ANIL
• Keywords: Unexplained cash credit
• Section: 143(3); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN (SMC) BEFOR E SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER I.T.A. NO.529/COCH/2018 ASSESSMENT YEAR : 2009 - 10 MR. SUBRAMANIAN S., TC/20/40(12), HOUSE NO.106, SASTHA NAGAR, KARAMANA, TRIVANDRUM - 695 002. [PAN: A E M PP 8295C] VS. THE ASSISTANT COMMISSIONER OF INCOME - TAX, CIRCLE - 2(1), RANGE - 2, TRI VANDRUM. (ASSESSEE - APPELLANT) (REVENUE - RESPONDE NT) ASSESSEE BY MS. ARYA ANIL, ADV. REVENUE BY SHRI MRITUNJAYA SHARMA, SR. DR DATE OF HEARING 12 / 0 2 / 20 20 DATE OF PRONOUNCEMENT 12 / 0 2 /20 20 O R D E R THIS APPEAL BY TH E ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE CIT(A), TRIVANDRUM DATED 31.08.2018 AND PERTAINS TO THE ASSESSMENT YEAR 2009 - 10. 2. AT THE OUTSET, IT WAS NOTICED THAT THERE WAS A DELAY OF 19 DAYS IN FILING THIS APPEAL BEFORE THE TRIBUNAL. THE ASSESSE E HAS FILED CONDONATION PETITION ACCOMPANIED BY AN AFFIDAVIT STATING THAT THE DELAY WAS OCCASIONED DUE TO THE REASON THAT THE AUDITOR WHO WAS HANDLING THE MATTER WHO IN TURN APPROACHED AN ADVOCATE FOR LEGAL OPINION , WAS BUSY WITH THE AUDITS AND HE COULD NO T FOLLOW UP I.T.A. NO. 529/ COCH/201 8 2 THE MATTER. IT WAS AFTER REMINDING THE AUDITOR ABOUT T H E SAME, THE LEGAL OPINION WAS SOUGHT FOR WHICH RESULTED IN DELAY OF 19 DAYS IN FILING THE APPEAL. IT WAS SUBMITTED THAT THE CONDUCT OF THE ASSESSEE WAS NEITHER WILFUL NOR CONTUMACIOUS. T HEREFORE, IT WAS PRAYED THAT THE TRIBUNAL MAY CONDONE THE DELAY OF 19 DAYS IN FILING THE APPEAL BEFORE THE TRIBUNAL. 2.1 I HAVE GONE THROUGH THE CONDONATION PETITION EXPLAINING THE REASONS FOR THE DELAY IN FILING THE APPEAL. I FIND THAT THERE IS GOOD AND SUFFICIENT REASONS FOR BELATEDLY FILING THE APPEAL. HENCE, I CONDONE THE SHORT DELAY OF 19 DAYS AND ADMIT THE APPEAL FOR ADJUDICATION. 3. ON MERITS, THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: A. THE ORDER OF THE APPELLATE AUTHORIT Y TO THE EXTENT OBJECTED TO HEREIN IS ABSOLUTELY ILLEGAL, ARBITRARY AND UNAUTHORIZED. B. THE APPELLATE AUTHORITY PROCEEDS ON THE PREMISE THAT IN SPITE OF SEVERAL NOTICES, THE APPELLANT HAS NOT BOTHERED TO APPEAR FOR HEARING. IT IS PERTINENT TO NOTE THAT O N 8.3.2017 AND 6.4.2017, THE APPELLATE AUTHORITY WAS ON LEAVE. ON 27.5.2018 THE ADJOURNMENT WAS SOUGHT FOR WITH A REQUEST TO ADJOURN THE MATTER AND NOT TO HOLD THE HEARING BETWEEN 18 LH JUNE TILL 12 TH JULY 2017, HOWEVER THE HEARING WAS POSTED FOR 28' H JUNE 2017. THE NOTICES WERE BEING SERVED IN THE APPELLANT'S RESIDENCE. THEREFORE, THE LAST NOTICE FOR HEARING ON 27.8.2018 WAS SERVED DURING THE 'ONAM HOLIDAYS AND THEREFORE, THE APPELLANT COULD NOT APPEAR. THIS HAS RESULTED IN NON - APPEARANCE AND CONSEQUENTIAL ORDER PASSED. C. THE APPELLANT REPEATS AND REITERATES WHAT IS STATED BY HIM IN THE FIRST APPEAL MEMORANDUM FILED BEFORE THE 1' APPELLATE AUTHORITY. D. THE ADDITION OF INCOME FROM OTHER SOURCES OF RS.4,56,800/ - AND UNEXPLAINED CASH CREDIT OF RS.2,04,000/ - BY THE ASSESSING OFFICER IS AGAINST LAW AND FACTS. I.T.A. NO. 529/ COCH/201 8 3 E. THE APPELLANT HAS ALWAYS CO - OPERATED WITH THE DEPARTMENT AND HAS NEVER CONCEALED HIS INCOME. F. THE ASSESSEE AND HIS WIFE MADE DEPOSITS WITH THE MONEY CHAIN BUSINESS OF M/S. TOTAL 4 U. THE BUSINESS CO LLAPSED AND THE ORGANIZATION'S ASSETS ARE NOW WITH A RECEIVER AS DIRECTED BY THE COURT. THE ENTIRE AMOUNT OF DEPOSITS INCLUDING INTEREST ACCRUED THEREON HAS BECOME A TOTAL LOSS FOR THE APPELLANT. SINCE THE APPELLANT IS FOLLOWING THE CASH SYSTEM OF ACCOUNTI NG, THE INTEREST WILL BE ACCOUNTED BY THE APPELLANT ONLY ON ACTUAL RECEIPT. G. THE APPELLANT HAD PURCHASED THE AGRICULTURAL PROPERTY IN TIRUNELVELI IN 2002 AND FOR PUMPING WATER HE HAD PURCHASED THREE DIESEL PUMPS (SECOND HAND) AND ONE ELECTRIC PUMP. THE APPELLANT HAD 12 CA T TLE DURING 2008, SINCE THE APPELLANT FOUND THE AGRICULTURAL ACTIVITIES UNVIABLE, HE DECIDED TO SELL IT OFF. THE CASH DEPOSITS ON VARIOUS DATES IN THE ICICI BANK ACCOUNT WERE REALIZATION OF SALE PROCEEDS OF THESE 12 CATTLE AND THE THREE DIESEL PUMPS. IT WAS NOT POSSIBLE FOR THE APPELLANT TO REALIZE THE SALE PROCEEDS AS ACCOUNT PAYEE CHEQUE SINCE THE BUYERS WERE AGRICULTURISTS IN RURAL AREA. IN ADDITION TO THIS, THE ASSESSING OFFICER PASSED THE ASSESSMENT ORDER WITHOUT GIVING REASONABLE T IME TO THE APPELLANT TO GIVE SATISFACTORY EXPLANATION ABOUT THIS CASH DEPOSITS. FOR THESE AND OTHER GROUNDS AND DOCUMENTS TO BE SUBMITTED AT THE TIME OF HEARING AND IT IS HUMBLY PRAYED THAT THE TRIBUNAL BE PLEASED TO ALLOW THE APPEAL. 4. IN THIS CASE, WHILE COMPLETING THE ASSESSMENT U/S. 143(3) OF THE I.T. ACT, THE ASSESSING OFFICER ADDED AN AMOUNT OF RS.4,56,800/ - TO THE TOTAL INCOME OF THE ASSESSEE BEING INTEREST ON DEPOSITS EARNED BY HIS WIFE. FURTHER, THE ASSESSING OFFICER ADDED AN AMOUNT OF RS.2,0 4,000/ - AS UNEXPLAINED CASH CREDIT U/S. 68 OF THE I.T. ACT, AGAINST WHICH THE ASSESSEE HAS CHALLENGED BEFORE THE TRIBUNAL. 4.1 AT THE TIME OF HEARING, T HE MAIN PLEA OF THE LD. AR WAS THAT APPROPRIATE OPPORTUNITY OF HEARING WAS NOT GIVEN TO THE ASSESSEE. THE LD. AR STATED THAT ON 8.3.2017 AND 6.4.2017, THE APPELLATE AUTHORITY WAS ON LEAVE. ON 27.5.2018 THE I.T.A. NO. 529/ COCH/201 8 4 ADJOURNMENT WAS SOUGHT FOR WITH A REQUEST TO ADJOURN THE MATTER AND NOT TO HOLD THE HEARING BETWEEN 18 TH JUNE TILL 12 TH JULY, 2017. HOWEVER, ACCORDING TO THE LD. AR, THE HEARING WAS POSTED ON 28 TH JUNE, 2017 AND THE NOTICES WERE SERVED IN THE ASSESSEES RESIDENCE. THEREFORE, IT WAS SUBMITTED THAT THE LAST NOTICE FOR HEARING ON 27.08.2018 WAS SERVED DURING THE ONAM HOLIDAYS AND THEREFORE, THE ASSESSEE C OULD NOT APPEAR WHICH RESULTED IN NON - APPEARANCE AND CONSEQUENTIAL ORDER PASSED. 5. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RECORD. ADMITTEDLY, THIS APPEAL WAS DECIDED EX PARTE BY THE CIT(A). IN MY OPINION, IT IS APPROPRIATE TO GIVE ONE MOR E OPPORTUNITY OF HEARING TO THE ASSESSEE TO PROVE HIS CASE BEFORE THE CIT(A). ACCORDINGLY, THE ENTIRE ISSUE IN DISPUTE IS REMITTED TO THE FILE OF THE ASSESSING OFFICER FOR FRESH CONSIDERATION. THE ASSESSEE SHALL CO - OPERATE WITH THE DEPARTMENT AND FILE NE CESSARY DOCUMENTS IN SUPPORT OF HIS CASE. IF THE ASSESSEE FAILS TO ATTEND THE HEARING BEFORE THE CIT(A), THE CIT(A) HAS THE LIBERTY TO TAKE DECISION IN ACCORDANCE WITH LAW. AT THIS STAGE, WE REFRAIN FROM GOING INTO OTHER GROUNDS OF APPEAL RAISED BY THE A SSESSEE. 6 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 12 - 0 2 - 20 20 . SD/ - ( CHANDRA POOJARI ) ACCOUNTANT MEMBER I.T.A. NO. 529/ COCH/201 8 5 PLACE: KOCHI DATED: 12 TH FEBRUARY, 20 20 GJ COPY TO: 1 . MR. SUBRAMANIAN S., TC/20/40(12), HOUSE NO.106, SASTHA NAGAR, KARAMANA, TRIVANDRUM - 695 002. 2. THE ASSISTANT COMMISSIONER OF INCOME - TAX, CIRCLE - 2 (1), RANGE - 2, TRIVANDRUM. 3 . THE COMMISSIONER OF INCOME - TAX(APPEALS), TRIVANDRUM 4. THE COMMISSIONER OF INCO ME - TAX, TRIVANDRUM. 5. D. R., I.T.A.T., COCHIN BENCH, COCHIN. 6 . GUARD FILE. BY ORDER (ASSISTAN T REGISTRAR) I.T.A.T., COCHIN