Smt. Mamta Alias Ashul Rastogi, Kaimganj V. I.T.O.-2(1), Farrukhabad

ITA 55/AGR/2011

• Counselvise Citation: [2011] 119 COUNSELVISE.COM (IT) 6925 (ITAT-AGRA)
• Duration Of Justice: 9 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-11-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 18-11-2011
• Assessment Year: 2000-2001
• Appeal Filed On: 18-02-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K SHARMA
• Assessee Lawyers: J L VERMA
• Keywords: Gift; Accommodation entries; Reason to believe
• Section: 143(3); 142(1); 147; 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI B.P. JAIN, ACCOUNTANT MEMBER ITA NO. 55/AGRA/2011 ASSTT. YEAR : 2000-2001 SMT. MAMTA RASTOGI, VS. INCOME-TAX OFFICER, MOHALLA NUNHAI, KAIMGANJ. 2(1), FARRUKHABAD. FARRUKHABAD. (PAN : AAKPR 7389 B) (APPELLANT) (RESPONDENT) FOR APPELLANT : SHRI J.L. VERMA, ADVOCATE. FOR RESPONDENT : SHRI A.K. SHARMA, JR. D.R. DATE OF HEARING : 18.11.2011 DATE OF PRONOUNCEMENT : 23.11.2011 ORDER PER BENCH: THE ASSESSEE HAS FILED THE PRESENT APPEAL AGAINST THE IMPUGNED ORDER DATED 06.01.2011 PASSED BY THE LEARNED CIT(A), GHAZIABAD ON THE FOLL OWING GROUNDS : 1. THAT THE LD. CIT(A) HAS GRAVELY ERRED IN LAW AN D ON FACTS IN UPHOLDING THE ASSESSMENT MADE BY THE LD. A.O. U/S. 144/147 WITHOUT PROPERLY APPRECIATING THAT FOUNDATIONAL NOTICE U/S. 148 HAS NOT BEEN SERVED UPON THE ASSESSEE AS PER PROVISIONS OF SECTION 282 OF THE I T ACT. 2. THAT THE LD. CIT(A) HAS ERRED IN LAW IN UPHOLDI NG THAT THE SERVICE OF NOTICE U/S. 148 IS VALID WITHOUT PROPERLY APPRECIAT ING THE PROVISIONS OF R. 15 ORDER 5 OF CPC/SECTION 282 OF THE I T ACT THAT NOTI CE OUGHT TO HAVE BEEN SERVED ON THE ASSESSEE OR UPON A PERSON WHO HAS BEEN AUTHO RIZED BY THE ASSESSEE TO RECEIVE SUCH NOTICE OR IS AN AGENT OF THE ASSESSEE. 3. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FAC TS IN UPHOLDING THE ASSESSMENT WHICH IS BASED ON PRESUMPTIONS, ASSUMPTI ONS AND ON HEARSAY WITHOUT BRINGING ANY EVIDENCE ON RECORD. 2 4. THAT THE LD. CIT(A) HAS NOT PROPERLY APPRECIATE D THE FACT THAT THE EVIDENCE/INFORMATION REGARDING GIFTS HAD BEEN DULY ANNEXED WITH THE RETURN OF INCOME AND INCORPORATED IN THE BALANCE SHEET FILED BEFORE THE LD. AO ON 17.07.2000 AS ADMITTED BY THE LD. A.O. IN HIS REMAN D REPORT. IT IS THEREFORE, INCORRECT TO ALLEGE THAT INFORMATION WAS CONCEALED FROM THE DEPARTMENT. IF THE A.O. HAD NOT CONSIDERED THE SAID INFORMATION/EVIDEN CE, FURNISHED WITH THE RETURN NO FAULT LIES ON THE ASSESSEE. 5. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FAC TS IN NOT PROPERLY APPRECIATING THAT THE LD. A.O. ACTED AT THE BEHEST OF THE DEPARTMENTAL AUTHORITIES WITHOUT APPLYING HIS OWN MIND AND WITHOUT RECORDING REASONS FOR ISSUE OF NOTICE U/S. 148. 6. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FAC TS IN CONFIRMING ADDITION OF RS.5,75,915/- ON THE ALLEGED GROUND OF BOGUS GIFTS/LOANS WITHOUT PROPERLY APPRECIATING THE ENTIRETY OF FACTS AND WIT HOUT PROPERLY APPRECIATING THAT THE ALLEGATIONS OF ALLEGED BOGUS TRANSACTIONS ARE V AGUE AND IN RESPECT OF THE ALLEGED UPON A LARGE NUMBER OF PERSONS AND NOT SPEC IFIC IN RESPECT OF ASSESSEE WHICH TOO ARE BASED ONLY ON PRESUMPTIONS AND NOT ON ANY EVIDENCE. 7. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FAC TS IN UPHOLDING THE ASSESSMENT WITHOUT PROPERLY APPRECIATING THAT THE A SSESSEES OBJECTIONS AGAINST ALLEGED NOTICE U/S. 148 WERE FOR A.Y. 2000-01 WHERE AS THE DECISION OF THE LD. A.O. IS FOR A.Y. 2005-06. 8. THAT THE LD CIT(A) HAS NOT APPRECIATED THAT THE ASSESSEE HAS NOT BEEN CONFRONTED BY THE LD. A.O. WITH ANY MATERIAL OR EVI DENCE COLLECTED BY HIM, IF ANY, AT THE BACK OF THE ASSESSEE. 9. THAT THE LD. CIT(A) HAS BRUSHED ASIDE THE CASE LAWS CITED BEFORE HIM AND HAS NOT APPRECIATED THE CONTENTS OF ASSESSEES AFFIDAVIT DENYING SERVICE OF NOTICE U/S. 148 UPON HER. 10. THAT IN ANY VIEW OF THE CASE THE ENTIRE ASSESS MENT PROCEEDINGS AND ADDITION IS HIGHLY UNJUST, IMPROPER, ILLEGAL AND AB -INITIO VOID. 2. THE BRIEF FACTS RELATING TO THE ISSUE IN DISPUTE ARE THAT THE ASSESSING OFFICER ISSUED A NOTICE U/S. 148 ON 28.03.2007 WHICH WAS SERVED ON 3 0.03.2007. THE BASIS FOR TAKING ACTION U/S. 147 WAS THE OUTCOME OF ENQUIRIES MADE BY ADIT (INV. )-3, KANPUR. DURING THE COURSE OF ENQUIRY MADE, IT WAS DETECTED THAT MANY PEOPLE HAVE TAKEN A CCOMMODATION ENTRIES BY OPENING BANK ACCOUNT AND ISSUING BANK DRAFTS OR CHEQUES TO THE B ENEFICIARIES WHO ACTUALLY DEPOSITED THEIR OWN 3 MONEY INTO THE BANK ACCOUNTS AND AFTER DOING SO THE Y RECEIVED THEIR MONEY BACK THR0UGH CHEQUES AND DDS OF EQUIVALENT AMOUNT FROM THE NAME- SAKE OPERATOR OF THESE BANK ACCOUNTS. THE BENEFICIARIES DEPOSITED THESE CHEQUES OR DDS AS GIF T RECEIVED OR LOAN TAKEN. ACTUALLY THE RECIPIENTS OF THESE CHEQUES/DDS WERE NOT BONAFIDE, BUT ONLY ACCOMMODATION ENTRIES HOLDERS. AFTER RECEIVING THE NOTICE U/S. 148, THE ASSESSEE D ID NOT FILE HER RETURN OF INCOME NOR SHE REPORTED THAT SHE IS AN OLD ASSESSEE OF WARD 2(1) FARRUKHABA D. SHRI RAJAN MAHESHWARI ADVOCATE MOVED AN APPLICATION ON 13.12.2007 POINTING OUT THAT JURI SDICTION OF THE CASE IS IN WARD 2(1), FARRUKHABAD AND THE ASSESSEE IS A REGULAR TAX PAYER WHEN THIS FACT SHOULD HAVE BEEN REPORTED EARLIER BY THE ASSESSEE OR HER COUNSEL AS SOON AS T HE NOTICE U/S. 148 WAS ISSUED AND SERVED UPON. THE ASSESSING OFFICER FURTHER HELD THAT THERE IS CO NCURRENT JURISDICTION AT FARRUKHABAD, BUT THE ASSESSEE AWAITED THE ISSUE OF NOTICE U/S. 142(1) ON 26.11.2007 WHEN THE LIMITATION WAS GOING TO END. RESULTANTLY, THE CASE WAS TRANSFERRED IN WARD- 1, FARRUKHABAD ON 14.12.2007. 3. THE ASSESSING OFFICER ISSUED NOTICE U/S. 142(1) ON 17.12.2007 ALONGWITH THE QUESTIONNAIRE FOR MAKING AVAILABLE THE EVIDENCES RE GARDING GENUINENESS OF THE GIFTS, TO FURNISH DETAILS OF OTHER GIFTS RECEIVED, TO FURNISH BANK ST ATEMENTS FOR SELF AND OF DEPENDANT FAMILY MEMBERS. IN RESPONSE TO THE SAME THE ASSESSEE MOVE D A WRITTEN EXPLANATION BY FAX CHALLENGING THE LEGALITY OF NOTICE U/S. 148 AND NOTICE U/S. 142 (1) WHICH WAS REJECTED BY THE ASSESSING OFFICER ON 19.12.2006. THE ASSESSING OFFICER ALSO ISSUED NO TICE U/S. 142(1) AND REQUIREMENT LETTER DATED 24.12.2007 BUT THE ASSESSEE REFUSED TO RECEIVE THE SAME AND LASTLY, THE NOTICE U/S. 142(1) AND THE QUERY LETTER WERE AFFIXED ON THE MAIN DOOR OF THE R ESIDENCE OF ASSESSEE SMT. MAMTA RASTOGI AND FINALLY THE AO COMPLETED THE ASSESSMENT U/S. 144 OF THE ACT BY MAKING THE ADDITION IN DISPUTE ON 28.12.2007 U/S. 144 OF THE ACT. AGGRIEVED BY THE SA ME, THE ASSESSEE FILED AN APPEAL BEFORE THE LD. 4 FIRST APPELLATE AUTHORITY WHO VIDE IMPUGNED ORDER D ATED 06.01.2001 DISMISSED THE APPEAL FILED BY THE ASSESSEE. NOW THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER AND HAS FILED THE PRESENT APPEAL. 4. SHRI J.L. VERMA, ADVOCATE APPEARED FOR THE ASSES SEE AND STATED THAT THE LD. FIRST APPELLATE AUTHORITY HAS WRONGLY UPHELD THE ORDER OF ASSESSING OFFICER WITHOUT PROPERLY APPRECIATING THAT THE FOUNDATIONAL NOTICE U/S. 148 OF THE ACT HAS NOT BEEN SERVED UPON THE ASSESSEE. KEEPING IN VIEW OF THE PROVISIONS OF RULE 15 ORDER 5 OF CPC RE AD WITH SECTION 282 OF THE INCOME-TAX ACT. HE FURTHER STATED THAT THE ASSESSING OFFICER HAS NO T INITIATED THE VALID PROCEEDINGS IN THE CASE OF ASSESSEE BECAUSE THE ASSESSMENT IN DISPUTE HAS BEEN COMPLETED BY THE ITO WARD 2(1), FARRUKHABAD WHEREAS THE REASON PRESUMING ESCAPEMENT OF INCOME WAS RECORDED BY DCIT CIRCLE 2(1), FARRUKHABAD AND NOTICE U/S. 148 GOT ISSUED BY HIM. SECTION 148 OF THE ACT MAKES IT ABUNDANTLY CLEAR THAT NOTICE U/S. 148 CAN ONLY BE I SSUED BY THE ASSESSING OFFICER PROVIDED HE HAS REASON TO BELIEVE, BUT IN THE CASE IN HAND, DCIT 2( 1) WHO ALLEGEDLY ISSUED NOTICE U/S. 148 TO THE ASSESSEE NEVER EVER HAD THE JURISDICTION, WHICH HAV E NOT BEEN PROPERLY APPRECIATED. THEREFORE, THE APPEAL FILED BY THE ASSESSEE MAY BE ACCEPTED. 5. ON THE CONTRARY, THE LD. DR RELIED UPON THE ORDE R PASSED BY THE LD. FIRST APPELLATE AUTHORITY. 6. WE HAVE HEARD THE BOTH PARTIES AND PERUSED THE R ELEVANT RECORD AVAILABLE WITH US. WE HAVE THOROUGHLY GONE THROUGH THE PROVISIONS OF SECT ION 282 OF THE ACT ALONGWITH THE PROVISIONS OF RULE 15 ORDER 5 OF THE CPC AS WELL AS THE DECISI ON RENDERED BY ITAT, AGRA BENCH DATED 5 09.11.2011 PASSED IN THE CASE OF SHRI VINOD KALRA V S. ITO IN ITA NO. 298/AGRA/2011 FOR A.Y. 2001-02. THE RELEVANT PORTION OF THE SAME IS REPROD UCED AS UNDER : 5. I HAVE HEARD THE BOTH PARTIES AND PERUSED THE R ELEVANT RECORD AVAILABLE WITH ME. I HAVE ALSO THOROUGHLY GONE THRO UGH THE ORDERS PASSED BY THE REVENUE AUTHORITIES AS WELL AS THE DOCUMENTARY EVID ENCE FILED BY THE ASSESSEE BEFORE ME IN THE SHAPE OF PAPER BOOK CONTAINING PAG ES NO. 1 TO 17 ALONGWITH WRITTEN SUBMISSION FILED BY LD. DR. IT IS A MATTER OF RECORD THAT THAT SHRI VIJAI SINGH, INCOME-TAX OFFICER 4(4), AGRA HAS RECORDED T HE REASONS FOR THE ASSESSMENT YEAR IN DISPUTE BEFORE INITIATING PROCEEDINGS U/S. 148 AND THEREAFTER HAS ALSO OBTAINED THE APPROVAL OF ADDL. COMMISSIONER OF INCO ME-TAX. IT IS ALSO A MATTER OF RECORD THAT SHRI VIJAI SINGH, ITO 4(4), AGRA HAS AL SO ISSUED NOTICE DATED 28.03.2008 TO THE ASSESSEE U/S. 148 OF THE ACT FOR THE ASSESSMENT YEAR IN DISPUTE, I.E., 2001-02. THEREAFTER THE ITO 1(3), AGRA HAS IS SUED A NOTICE U/S. 142 OF THE ACT DATED 02.12.2008. IT IS ALSO MATTER OF RECORD THAT THE ITO 1(3), AGRA HAS ALSO ISSUED A NOTICE DATED 02.12.2008 U/S. 143(2) OF THE ACT TO THE ASSESSEE FOR THE ASSESSMENT YEAR IN DISPUTE. I HAVE PERUSED THE SAID NOTICES WHICH IS A PART OF THE SAID PAPER BOOK FILED BY THE COUNSEL FOR THE ASSESS EE. AFTER PERUSING THE SAME, I AM OF THE CONSIDERED OPINION THAT THE RE-ASSESSMENT IN DISPUTE HAS BEEN COMPLETED BY AN INCOME-TAX OFFICER ON THE BASIS OF NOTICE U/S. 148 OF THE ACT ISSUED BY ANOTHER ITO WHO HAD NO JURISDICTION OVER THE ASSESSEE. THEREFORE, KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCES OF T HE PRESENT CASE, THE RE- ASSESSMENT IN DISPUTE IS INVALID AND WITHOUT JURISD ICTION WHICH IS LIABLE TO BE CANCELLED. I AM OF THE VIEW THAT THE ISSUE IN DISPU TE HAS ALREADY BEEN ADJUDICATED AND DECIDED IN FAVOUR OF ASSESSEE BY THE DECISION O F ITAT, DELHI E BENCH IN THE CASE OF ITO VS. KRISHNA KUMAR GUPTA REPORTED IN 16 DTR (DELHI)(TRIB.) 1. I HAVE THOROUGHLY GONE THROUGH THE ORDER PASSED BY THE ITA T DELHI E BENCH AND I AM OF THE CONSIDERED OPINION THAT THE LEGAL ISSUE RAIS ED BY THE LD. COUNSEL FOR THE ASSESSEE HAS ALREADY BEEN ADJUDICATED AND DECIDED I N FAVOUR OF THE ASSESSEE. RESPECTFULLY FOLLOWING THE SAME, THE ASSESSMENT ORD ER U/S. 143(3)/147 DATED 19.12.2008 FOR THE ASSESSMENT YEAR 2001-02 WHICH IS BASED ON THE NOTICE U/S. 148 ISSUED BY ANOTHER ITO WHO HAD NO JURISDICTION OVER THE ASSESSEE, IS NOT A VALID RE- ASSESSMENT. THEREFORE, I ACCEPT THE ARGUMENT OF THE LD. COUNSEL FOR THE ASSESSEE ON LEGAL ISSUE AND ACCEPT THE APPEAL FILED BY THE ASSE SSEE BY CANCELING THE IMPUGNED ORDER PASSED BY THE LD. FIRST APPELLATE AUTHORITY W HO HAS WRONGLY HELD THAT ASSESSEE CANNOT RAISE THIS LEGAL GROUND AT APPELLAT E STAGE AND HE WRONGLY DISMISSED THE LEGAL OBJECTION RAISED BY THE ASSESSE E CHALLENGING THE JURISDICTION OF INCOME-TAX OFFICER 1(3), AGRA WHO PASSED THE ORDER IN DISPUTE U/S. 147 READ WITH SECTION 143(3) OF THE INCOME-TAX ACT. IN THE LIGHT OF ABOVE DISCUSSION, I AM NOT INCLINED TO UPHOLD THE IMPUGNED ORDER AND DECLARE T HAT THE ASSESSMENT MADE BY THE INCOME-TAX OFFICER 1(3), AGRA IS WITHOUT JURISD ICTION AND THUS, INVALID AND IS HEREBY CANCELLED. SINCE I HAVE DECIDED THE LEGAL IS SUE IN FAVOUR OF ASSESSEE AND 6 CANCELLED THE ASSESSMENT IN DISPUTE, THEREFORE, THE RE IS NO NEED TO ADJUDICATE THE CASE OF ASSESSEE ON MERIT. KEEPING IN VIEW OF THE AFORESAID DECISION OF THIS B ENCH AS WELL AS RELEVANT PROVISIONS OF RULE 15 ORDER 5 OF THE CPC READ WITH SECTION 282 OF THE ACT , WE ARE OF THE CONSIDERED OPINION THAT IN THE CASE OF ASSESSEE, REASONS HAVE BEEN RECORDED BY DCI T CIRCLE 2(1) FARRUKHABAD AND NOTICE U/S. 148 HAS ALSO BEEN ISSUED BY HIM, BUT THE ASSESSMENT IN DISPUTE HAS BEEN COMPLETED BY THE ITO 2(1), FARRUKHABAD. KEEPING IN VIEW OF THE AFORESAID DECISION, THE ASSESSMENT IN DISPUTE IS WITHOUT JURISDICTION AND THUS INVALID AND HEREBY CA NCELLED. SINCE THE IMPUGNED ASSESSMENT HAS BEEN CANCELLED ON LEGAL GROUND, THERE IS NO NEED TO ADJUDICATE THE CASE OF THE ASSESSEE ON MERIT. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 23.11.2011. SD/- SD/- (B.P. JAIN) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 23 RD NOVEMBER, 2011 *AKS/- COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A) BY ORDER 4. CIT, CONCERNED 5. DR, ITAT, AGRA 6. GUARD FILE ASSISTANT REGISTRAR TRUE COPY