THE ITO, Dhar V. SHRI SHAILENDRA KUMAR JAISWAL, Dhar

ITA 561/IND/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 5990 (ITAT-INDORE)
• Duration Of Justice: 7 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-01-2017
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 05-01-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 20-05-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAJEEV JAIN
• Assessee Lawyers: C P RAWKA
• Keywords: Opportunity of being heard; Additional evidence
• Section: 144

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE .., .., % BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI O.P. MEENA, ACCOUNTANT MEMBER INCOME-TAX OFFICER, DHAR .. ./ PAN: AGSPJ5118J VS. SHRI SHAILENDRA KUMAR JAISWAL, SUNDREL, TEH. DHARAMPURI, DISTT. DHAR. / APPELLANT / RESPONDENT / APPELLANT BY SHRI RAJEEV JAIN, DR / RESPONDENT BY SHRI C.P.RAWKA, CA DATE OF HEARING 05.01.2017 DATE OF PRONOUNCEMENT 11.01.2017 / O R D E R PER O.P. MEENA, ACCOUTANT MEMEBR. THIS APPEAL IS FILED BY THE REVENUE AGAINST THE ORD ER OF LD. COMMISSIONER OF INCOME-TAX (APPEALS)-I, INDORE [HEREINAFTER .. . / I.T.A. NO. 561/IND/2016 %' ' / ASSESSMENT YEAR: 2011-12 I.T.A.NO. 561/IND/2016 A.Y. 2011-12 SHRI SHAILENDRA KUMAR JAISWAL, DHAR PAGE 2 OF 10 REFERRED TO AS THE CIT(A)] DATED 26.02.2016 AND PER TAINS TO ASSESSMENT YEAR 2008-09 AS AGAINST APPEAL DECIDED I N ASSESSMENT ORDER PASSED U/S 144 OF THE ACT DATED 1 4.03.2014 OF ITO, DHAR[HEREINAFTER REFERRED TO AS THE AO]. 2. THE REVENUE HAS TAKEN THE FOLLOWING GROUNDS OF APPEAL :- 1. WHETHER IN THE FACTS AND CIRCUMSTANCES, THE LD. CIT(A) ERRED IN CONTRADICTING HIS FINDINGS THAT THE ORDER U/S 144 WAS JUSTIFIED IN THE FACTS OF THE CAS E, BY CALLING FOR A REMAND REPORT FROM THE AO. 2. WHETHER IN THE FACTS AND CIRCUMSTANCES, THE LD. CIT(A) ERRED IN LAW AFTER COMING TO THE CONCLUSION THAT ORDER U/S 1`44 WAS JUSTIFIED SHOULD HAVE UPHELD THE ASSESSMENT ORDER WHERE THE AO HAD CONSIDERED ALL THE FACTS OF THE CASE. 3. WHETHER IN THE FACTS AND CIRCUMSTANCES, THE LD. CIT(A) ERRED IN LAW BY ALLOWING THE APPEAL OF THE ASSESSEE BY IGNORING THE VERY FACT THAT THE ASSESSE E WAS ALLOWED AMPLE OPPORTUNITIES TO ATTEND THIS CASE I.T.A.NO. 561/IND/2016 A.Y. 2011-12 SHRI SHAILENDRA KUMAR JAISWAL, DHAR PAGE 3 OF 10 BUT HE DID NOT ATTEND AND THE AO WAS COMPELLED TO PASS ORDER U/S 144 OF THE INCOME-TAX ACT, 1961. 4. WHETHER IN THE FACTS AND CIRCUMSTANCES IN THE CASE THE LD. CIT(A) ERRED IN CALLING FOR REMAND REPORT E VEN AFTER HOLDING THAT THE ORDER PASSED U/S 144 OF THE INCOME-TAX ACT, 1961, WAS JUSTIFIED. 5. WHETHER IN THE FACTS AND CIRCUMSTANCES, THE LD. CIT(A) ERRED IN LAW BY DIRECTING THE AO TO VERIFY T HE CLAIM OF DEDUCTION UNDER CHAPTER VIA AND THEN ALLOWED THE SAID DEDUCTION, THE CIT(A) HAS IN EFFEC T SET ASIDE THE ORDER WHICH IS NOT PERMISSIBLE UNDER THE ACT. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND DERIVES INCOME FROM L IQUOR BUSINESS. THE ASSESSEE HAS FILED HIS RETURN OF INCO ME ON 30.09.2011 DISCLOSING TOTAL INCOME AT RS. 6,90,040/ -. THE AO REQUIRED THE ASSESSEE TO FURNISH THE DETAILS OF PUR CHASE AND SALES AND EXPLAIN THE SOURCE OF EXPENSES CLAIMED AN D DETAILS OF SUNDRY CREDITORS WITH CONFIRMATION. HOWEVER, HAV ING BEEN I.T.A.NO. 561/IND/2016 A.Y. 2011-12 SHRI SHAILENDRA KUMAR JAISWAL, DHAR PAGE 4 OF 10 ALLOWED VARIOUS OPPORTUNITIES OF BEING HEARD, THE A SSESSEE HAS FAILED TO COMPLY. THEREFORE, THE AO WAS FORCED TO MA KE ASSESSMENT U/S 144 OF THE ACT. ACCORDINGLY, THE AO ASSESSED INCOME AT RS. 1,08,13,774/- BY MAKING VARIOUS ADDIT IONS. 4. BEING AGGRIEVED, THE ASSESSEE HAS FILED THE APPEAL BEFORE THE CIT(A). 5. DURING THE COURSE OF APPELLATE PROCEEDINGS, THE ASSESSEE HAS FILED WRITTEN SUBMISSION VIDE LETTER DA TED 30.04.2015 AND 19.10.2015, GIVING VARIOUS DETAILS A ND ADDITIONAL EVIDENCES. THE LD. CIT(A) OBSERVED THAT THE AO HAS ALLOWED THE NUMBER OF OPPORTUNITIES FIXING THE DATE OF HEARING ON 23.12.2013, 05.02.2014, BUT REQUISITE DETAILS WE RE NOT FURNISHED. THEREFORE, THE LD. CIT(A) UPHELD THAT TH E SUFFICIENT OPPORTUNITY WAS PROVIDED TO THE ASSESSEE. THEREFORE, THE AO WAS JUSTIFIED IN FRAMING THE ASSESSMENT U/S 144 OF T HE ACT. THE LD. CIT(A) HAS ALSO CALLED FOR THE COMMENTS OF THE AO BY WAY OF REMAND REPORT AND DEALT WITH VARIOUS ISSUES AN D DELETED THE ADDITION OF RS. 1 LAKH OF DISALLOWANCES MADE UNDER CHAPTER VIA SUBJECT TO VERIFICATION. THE LD. CIT(A) FURTHER I.T.A.NO. 561/IND/2016 A.Y. 2011-12 SHRI SHAILENDRA KUMAR JAISWAL, DHAR PAGE 5 OF 10 DELETED THE ADDITION OF RS. 55,19,272/- BEING CASH DEPOSITS IN BANK ACCOUNT WITH STATE BANK OF INDIA AFTER CONSIDER ING THE REMAND REPORT AND ALSO DELETED THE ADDITION OF RS. 9,09,057/- BEING ESTIMATED PROFIT. SIMILARLY, THE ADDITION OF RS. 8,80,035/- BEING BASIC LICENCE FEE UNEXPLAINED AND RS. 25,150/- BEING PENALTY DEBITED IN PROFIT AND LOSS A CCOUNT WAS ALSO CAME TO BE DELETED AND ADDITION ON ACCOUNT OF SUNDRY CREDITORS AMOUNTING TO RS. 7,80,000/- WAS RESTRICTED TO RS. 1,80,000/-. SIMILARLY, THE ADDITION OF RS. 6 LAKHS PERTAINING TO CREDIT AMOUNT IN THE NAME OF PHOOL BADAN SINGH WAS D ELETED AND ADDITION OF RS. 4,96,400/- BEING INVESTMENT FOR ADVANCES FOR FLAT WAS ALSO DELETED. 6. BEING AGGRIEVED, THE REVENUE HAS FILED THIS APPEAL BY TAKING THE GROUNDS THAT THE LD. CIT(A) WAS NOT JUS TIFIED IN DELETING THE ADDITIONS MADE BY THE AO, WHILE UPHOLDI NG THE FINDING THAT THE ORDER U/S 144 WAS JUSTIFIED IN THE FACTS OF THE CASE. THE LD. SR. DR FURTHER ARGUED THAT THE LD. CI T(A) HAS ADMITTED THE ADDITIONAL EVIDENCES WITHOUT GIVING FIN DINGS AND REASONS FOR ADMISSION OF THE SAME. THEREFORE, THE V IEW TAKEN I.T.A.NO. 561/IND/2016 A.Y. 2011-12 SHRI SHAILENDRA KUMAR JAISWAL, DHAR PAGE 6 OF 10 BY THE LD. CIT(A) IS CONTRADICTORY IN ITSELF AS AT THE SAME TIME HE IS UPHOLDING THE ACTION OF THE AO IN FRAMING THE ASSESSMENT U/S 144 OF THE ACT AND ON THE OTHER HAND , THE ADDITIONAL EVIDENCES ARE ADMITTED AND ADDITIONS MAD E BY THE AO ARE BEING DELETED ON THE BASIS OF REMAND REPORT. THE LD. SR. DR HAS ALSO SUBMITTED THAT THE LD. CIT(A) HAS DELET ED THE ADDITION OF RS. 55 LAKHS BEING CASH DEPOSITED IN ST ATE BANK OF INDIA AFTER ALLOWING SET-OFF AGAINST THE TURNOVER AN D SIMILARLY, THE ADDITION OF RS. 4,96,400/- BEING ADVANCE AGAINS T FLATS WAS DELETED INSPITE OF THE AO HAVING BEEN REPORTED THAT SOURCE OF INVESTMENT CANNOT BE VERIFIED AS THE ASSESSEE HAS N OT SUBMITTED THE CASH BOOK/BANK RECONCILIATION STATEME NT INSPITE OF REPEATED REMINDERS. THE LD. SR. DR HAS A LSO PLACED RELIANCE ON THE DECISION OF HON'BLE SUPREME COURT I N THE CASE OF JYOTSNA SURI VS. I.T.A.T., (2003) 179 CTR ( S.C. ) 265, WHEREIN THE HON'BLE SUPREME COURT HAS HELD AS UNDER :- 2. THE TRIBUNAL HAS DISPOSED OF THE APPEAL BY ITS ORDER OF 3 RD JAN.,1997, WITHOUT CONSIDERING THE PENDING APPLICATION UNDER RULE 29 OF THE I.T.A.T. RULES, 19 63, FOR I.T.A.NO. 561/IND/2016 A.Y. 2011-12 SHRI SHAILENDRA KUMAR JAISWAL, DHAR PAGE 7 OF 10 ADDUCING ADDITIONAL EVIDENCE. OBVIOUSLY, THAT APPLI CATION WAS REQUIRED TO BE DISPOSED OF FIRST BEFORE THE TRI BUNAL HEARD THE APPEAL ON MERITS. THE APPELLANT ALSO UNDE RTAKES TO WITHDRAW THE PENDING APPLICATION BEFORE THE TRIB UNAL FOR MAKING A REFERENCE UNDER SECTION 256(1) OF THE INCOME- TAX ACT, 1961, FOR THE ABOVE PURPOSE. IN VIEW THERE OF, WE DIRECT THAT THE TRIBUNAL SHOULD FIRST DISPOSE OF TH E APPLICATION UNDER RULE 29 ON MERITS AND THEREAFTER PROCEED TO DISPOSE OF THE APPEAL ON MERITS. THE ORD ER DATED 3 RD JAN.,1997,IS, THEREFORE, SET-ASIDE AND THE MATTER IS REMITTED TO THE TRIBUNAL FOR DISPOSAL ON MERIT I N ACCORDANCE WITH LAW. THE ORDER OF THE HIGH COURT IS SET- ASIDE AS ABOVE AND THE APPEAL IS DISPOSED OF ACCORD INGLY. 7. IN VIEW OF THE ABOVE, IT WAS SUBMITTED THAT THE ISS UE MAY BE RESTORED TO THE FILE OF THE AO FOR EXAMINATI ON OF ADDITIONAL EVIDENCE PRODUCED BY THE ASSESSEE AFTER ADMITTING ADDITIONAL EVIDENCE. 8. ON THE OTHER HAND, THE LD. AUTHORIZED REPRESENTATIV E OF THE ASSESSEE RELIED ON THE ORDER OF THE CIT(A) A ND SUBMITTED I.T.A.NO. 561/IND/2016 A.Y. 2011-12 SHRI SHAILENDRA KUMAR JAISWAL, DHAR PAGE 8 OF 10 THAT THE ADDITIONS HAVE BEEN DELETED AFTER DULY CON SIDERING THE REMAND REPORT SUBMITTED BY THE AO VIDE LETTER DATED 04.11.2015 AND 28.01.2016. THEREFORE, THE LD. AUTHO RIZED REPRESENTATIVE OF THE ASSESSEE SUPPORTED THE ORDER OF THE CIT(A). 9. WE HAVE CONSIDERED THE FACTS, RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE LD. CIT(A) HAS UPHELD FRAMING THE ASSESSMENT MADE U/S 1 44 OF THE INCOME-TAX ACT, 1961, BUT ON THE SAME TIME, THE LD. CIT(A) HAS DELETED ALL THE ADDITIONS MADE BY THE AO WITHOUT GIVING FINDING OF ADMISSION REGARDING ADDITIONAL EVIDENCE PRODUCED BY THE ASSESSEE BEFORE HIM. WE HAVE ALSO GONE THROU GH THE REMAND REPORT AND FIND THAT INSPITE OF DISALLOWANCE S PERTAINING TO SALARY EXPENSES UNDER CHAPTER VIA, CA SH CREDIT OF RS. 6 LAKHS IN THE NAME OF PHOOL BADAN SINGH AND CASH DEPOSITS OF RS. 55 LAKHS IN THE BANK ACCOUNT HAVE BEEN DELETED ON THE BASIS OF REMAND REPORT FAVOURING THE ASSESSEE AND LICENCE FEE OF RS. 8,80,035/- ON THE BASIS OF E STIMATE. HOWEVER, THE ADDITION OF RS. 4,96,400/- BEING ADVA NCE I.T.A.NO. 561/IND/2016 A.Y. 2011-12 SHRI SHAILENDRA KUMAR JAISWAL, DHAR PAGE 9 OF 10 AGAINST FLAT AND ADDITION ON PROFIT ESTIMATED WAS DE LETED WITHOUT ANY REFERENCE OF REMAND REPORT. CONSIDERING THESE FACTS, WE ARE OF THE CONSIDERED OPINION THAT WITHOUT RECORDING FINDING OF ADMISSION OF ADDITIONAL EVIDENCE BY THE ASSESSEE, THERE IS A PROCEDURAL LACUNA IN THE ORDER OF THE LD . CIT(A). FURTHER, THE CONFIRMATION OF THE FRAMING OF ASSESSM ENT U/S 144 OF THE ACT AND THEREAFTER DELETING THE ENTIRE A DDITION BASED ON GENERAL OBSERVATIONS ON THE REMAND REPORT. THE L D. CIT(A) WAS NOT JUSTIFIED IN DELETING THE ADDITIONS WITHOUT R ECORDING THE FINDING OF THE ADMISSION OF ADDITIONAL EVIDENCE S IN THE LIGHT OF HON'BLE SUPREME COURTS DECISION IN THE CASE OF JYOTSNA SURI VS. I.T.A.T. (SUPRA). THEREFORE, IN THE INTERE ST OF JUSTICE AND FAIR PLAY, WE DEEM IT NECESSARY TO SET-ASIDE THE WHOLE ISSUE TO THE FILE OF AO TO EXAMINE THE ADDITIONAL E VIDENCES FILED BY THE ASSESSEE AND MAKE THE FRESH ASSESSMENT AFTER ALLOWING OPPORTUNITY TO THE ASSESSEE. WE ALSO ALLOW ADMISSION OF ADDITIONAL EVIDENCE. CONSEQUENTLY, THE APPEAL OF TH E REVENUE IS SET-ASIDE. THE AO WILL ALLOW TO FURNISH NECESSARY DETAILS BY THE ASSESSEE AND PROPER OPPORTUNITY OF BEING HEARD. I.T.A.NO. 561/IND/2016 A.Y. 2011-12 SHRI SHAILENDRA KUMAR JAISWAL, DHAR PAGE 10 OF 10 10. IN THE RESULT, THE APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. THE ORDER HAS BEEN PRONOUNCED IN OPEN COURT ON THE 11 TH JANUARY, 2017. SD/- (..) (D.T.GARASIA) JUDICIAL MEMBER SD/- (..) (O.P.MEENA) ACCOUNTANT MEMBER * / DATED : 11 TH JANUARY, 2017. CPU*