Shri Jagtar Singh, New Delhi V. ITO, Rudrapur

ITA 5452/DEL/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 81963 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-10-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 17-09-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 26-10-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Principle of natural justice

Judgement Text

INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D : NEW DELHI BEFORE SHRI S.V. MEHROTRA , ACCOUNTANT MEMBER AND SHRI A. T. VARKEY, JUDICIAL MEMBER ITA NO. 5452 /DEL/ 2012 (ASSESSMENT YEAR: 2009 - 10 ) JAGTAR SINGH, C/O. MANOJ KUMAR MITTAL & CO., CA 305, DAKHA CAHMBER, 2068/38, NAI WALA, KAROL BAGH, NEW DELHI PAN:BCFPS4414L VS. ITO RUDRAPUR (APPELLANT) (RESPONDENT) O R D E R PER A. T. VARKEY, JUDICIAL MEMBER THIS APPEAL IS PREFERRED BY THE ASSESSEE AND ARISES FROM THE ORDER OF THE LD CIT(A), DEHRADUN AND RELATES TO ASSESSMENT YEAR 2009 - 10. 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE AS UNDER: - 1. THAT UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE ADDITION OF RS.22,90,440.00 SUSTAINED BY THE LD CIT(A) - II, DEHRADHUN IS NOT TENABLE BOTH IN LAW AND FACTS. HENCE, THE ADDITION MADE, AS SUCH, MAY KINDLY BE DELETED. 2. THAT UNDER THE FACT S AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT(A) - II, DEHRADUN HAS ERRED IN SUSTAINING THE ADDITION OF RS.2,12,550/ - OUT OF RS.5,12,550/ - ON ACCOUNT OF DEPOSITS ON ILLEGAL AND UNTENABLE GROUNDS. HENCE, THE ADDITION AS SUCH MAY BE DELETED. 3. THAT UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT(A) - II, DEHRADUN HAS ERRED IN SUSTAINING THE ADDITION OF RS.18,00,000/ - ON ACCOUNT OF DEPOSITS IN BANK ON ILLEGAL AND UNTENABLE GROUNDS. HENCE, THE ADDITION AS SUCH MAY KINDLY BE DELETED. 4. THAT UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT(A) - II, DEHRADUN HAS ERRED IN SUSTAINING THE ADDITION OF RS.2,68,530/ - ON ACCOUNT OF PROFIT FROM TRADING ON ILLEGAL AND UNTENABLE GROUNDS. HENCE, THE ADDITION AS SUCH MAY KINDLY BE DELETED. APPELLANT BY : MANOJ KUMAR, CA RESPONDENT BY : VIVEK NANGIR, SR. DR PAGE 2 OF 4 3 . GROUND NOS. 1,2 AND 5 ARE NOT PRESSED AND THEREFORE DISMISSED. 4. GROUND NO.3 RELATES TO ADDITION OF RS.18 LAKHS ON ACCOUNT OF UN - EXPLAINED DEPOSITS IN THE BANK OF THE ASSESSEE. 5. BRIEF FACTS ARE THAT THERE WERE TWO CREDIT ENTRIES OF R S.4 LAKHS EACH ON 07 TH JULY 2008 IN THE BANK ACCOUNT OF THE ASSESSEE WITH THE AXIS BANK, R U DRUPUR AND ANOTHER CREDIT ENTRY OF RS. 10 LAKH ON 18 TH JUNE 2008 IN THE BANK ACCOUNT WITH NAINITAL BANK LTD, RUDRAPUR. IT WAS THE SUBMISSION OF THE ASSESSEE, THAT R S.8 LAKHS REPRESENTED ADVANCE RECEIPTS FROM M/S. SUKHMONI PROMOTER, RUDRAPUR AND RS.10 LA KHS WAS ADVANCE RECEIPT FROM SHRI DARBAR SINGH AGAINST SALE OF AGRICULTURE LAND. THE AO IN THE ABSENCE OF CONFIRMATION HELD THAT THE ASSESSEE FAILED TO DISCHARGE THE O NUS AND MADE THE IMPUGNED ADDITION, WHICH WAS LATER ON CONFIRMED BY THE LD CIT(A). 6. FROM A PERUSAL OF THE RECORDS, WE FIND THAT THE LD CIT(A) OBTAINED A REMAND REPORT FROM THE AO. IN THE SAID REMAND REPORT THE AO HAD OBSERVED AS UNDER: - RS.18 LAKH TAKEN FROM TWO ENTITIES: - ON THIS ISSUE, THE ASSESSEE HAS SUBMITTED REPLY AS FOLLOWS: WE HAVE RECEIVED TWO ENTRIES OF ADVANCES AGAINST SALE OF LAND TOTAL AMOUNTING TO RS.18 , 00,000/ - ONE OF THEM WAS FROM M/S SUKHMANI PROMOTERS, RUDRAPUR AMOUNT ING TO RS.800,000.00 ON 07.07.2008 (2 CHEQUES OF RS. 4 LAKH EACH). WHICH WE HAVE DEPOSITED IN OU R SB ACCOUNT NO.7259 AXIS BANK. WE ARE ENCLOSING HEREWITH THE COPY OF BANK STATEMENT SHOWING THE NAME OF SUKHMANI PROMOTERS AGAINST CREDITS GIVEN BY BANK, FOR Y OUR KIND PERUSAL, THE SECOND AMOUNT OF RS. 10 LAKH WAS RECEIVED FROM SHRI DARBARA SINGH VIDE CHEQUE NO.011015 DATED 17.06.2008 OF NAINITAL BANK LIMITED WHICH WAS CREDITED TO SB A/C NO.2897 OF MYSELF IN THE SAID BANK. WE ARE ENCLOSING HEREWITH THE BANK CERTI FICATE CONFIRMING THE SAME. WE HAVE REQUESTED BOTH THE PARTIES TO ISSUE US THE CONFIRMATION OF ABOVE, BUT THEY HAVE NOT PROVIDED THE SAME TO US. WE ARE GIVING HEREUNDER THE COMPLETE ADDRESS OF BOTH THE PARTIES AND REQUEST YOUR GOODSELF TO KINDLY OBTAIN THE CONFIRMATION DIRECTLY. PAGE 3 OF 4 M/S SUKHMANI PROMOTERS THROUGH MR. DARBARA SINGH PARTNER C/O M/S. SAM CABLES & CONDUCTORS PVT, LTD. VII!. SHIMLA PISTAUR, KICHHA ROAD, RUDRAPUR 263153 MR. DARBARA SINGH C/O M/S SAM CABLES & CONDUCTORS PVT, LTD. VILL. SHIMLA PISTAUR, KI CHHA ROAD, RUDRAPUR 2 63153 FURTHER, WE SUBMIT THAT MR. DARBARA SINGH & OTHER PARTNERS OF THE FIRM M/S SUKHMANI PROMOTERS ARE HAVING VERY GOOD FINANCIAL STANDING. ALL OF THEM ARE WELL KNOWN INDUSTRIALIST OF AREA. MR. DARBARA SIILGN IS ALSO MANAGING DIRECTOR OF A COMPANY NAMED MLS SAM CABLES & CONDUCTORS PVT, LTD., MANUFACTURING CABLES ETC. THEY HAVE ADVANCED THIS AMOUNT FOR PURCHASE OF LAND ON WHICH THEY WERE SUPPOSED TO DEVELOP AN INDUSTRIAL ESTATE. THEY ARE NOT ISSUING US THE CONFIRMATION OF THIS ADVANCE AMOUNT OBTAINED FROM THEM, EVEN AFTER OUR REPEATED REQUEST DUE TO SOME BUSINESS C ONFLICTS ON THEIR PART. ON REQUEST OF ASSESSEE AND TAKING VIEW OF NATURAL JUSTICE, A LETTER WAS ISSUED TO BANKS AND BOTH ENTITIES BUT NO REPLY WAS RECEIVED IN THIS OFFICE FROM ABOVE SAID ENTITIE S. HOWEVER, AS PER AXIS BANK STATEMENT, TRANSACTION OF RS.8 LAKHS DONE FROM AXIS BANK, RUDRAPUR BRANCH A/C NO. 1760 10200010900 IN THE NAME OF SUKHMANI PROMOTOR TO A /C NO.1760101000107259 OF SHRI JAGTAR SINGH TROUGH TRANSFER CHEQUES OF AXIS BANK NO.023102 AND 023103. AS PER NAINITAL BANK LTD. STATEMEN T RS.10 LAKHS WAS DEPOSITED IN A/C NO .2002897 OF SHRI JAGTAR SINGH THROUGH CHEQUE NO.011015 OF NAINITAL BANK LTD (COPY OF BOTH BANK STATEMENT AND THREE CHEQUES ARE ENCLOSED). 7. IT IS EVIDENT FROM THE AFORESA ID REMAND REPORT, THAT THE ASSESSEE HAD PLACED ON RECORD THE BANK - STATEMENT OF M/S. SUKHMANI PROMOTERS SHOWING THE REMITTANCE OF THE ASSESSEE. AS REGARDS RS.10 LAKHS, BANK CERTIFICATE TO THE SAID EFFECT WAS ALSO PLACED ON RECORD. IT IS THUS SEEN THAT THE A SSESSEE HAD FURNISHED EVIDENCE TO SUPPORT THE CREDITS AND ALSO REQUESTED THE AO TO ISSUE LETTERS AND TO OBTAIN CONFIRMATION DIRECTLY FROM THE SAID PARTIES. THE AR OF THE ASSESSEE HAD ALSO HIGHLIGHTED THAT LATER ON CONFIRMATION WAS RECEIVED FROM SHRI DARBARA SINGH, CONFIRMING THE ADVANCE OF RS. 10 LAKH. HAVING CONSIDERED THE ENTIRE GAMUT OF THE MATTER, IT APPEARS THAT BOTH THE AO IN THE REMAND PROCEEDINGS AND THE LD CIT(A) PAGE 4 OF 4 HAVE BRUSHED ASIDE THE EVIDENCES AND EXPLANATION RENDERED BY THE ASSESSEE. THUS TO MEET THE ENDS OF JUSTICE, WE SET - ASIDE THE IMPUGNED ORDER AND REMAND THE MATTER BACK TO THE FILE OF THE AO, TO CONSIDER DE - NOVO THIS GROUND IN THE LIGHT OF THE EVIDENCE AND EXPLANATION RENDERED BY THE ASSESSEE. NEEDLESS TO SAY THAT SUFFICIENT OPPORTUNIT Y SHALL BE GRANTED TO THE ASSESSEE WHILE THE ADJUDICATING THE SAME. 8. GROUND NO.4 RELATE S TO ADDITION OF RS.2,68,530/ - MADE BY THE AO BY APPLYING NET PROFIT RATE ON TOTAL SALES, AFTER OBTAINING ASSESSEES CONSENT. THE LD CIT(A) CONFIRMED THE ADDITION AS THE AR, WAS NOT ABLE TO ADD ANYTHING TO ENABLE A CONTRARY VIEW. THE LD AR COULD NOT DISPUTE THE ABOVE BASIS OF ADDITION , HAVING AGREED TO THE ADDITION DURING ASSESSMENT PROCEEDING . THEREFORE IT IS HELD THAT TH IS GROUND IS WITHOUT MERIT AND THEREFORE REJECT ED. 9. IN THE RESULT THE APPEAL IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 3 1 . 10 .2014. - S D / - - S D / - ( S.V. MEHROTRA ) (A. T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 3 1 / 10 / 2014 A K KEOT COPY FORWARDED TO 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI