Sh. Sanjay, Ghaziabad V. ITO, Ghaziabad

ITA 5644/DEL/2014

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 4261 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-11-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 1
• Next Hearing Date: 06-09-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 20-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SMC-1 NEW DELHI BEFORE SMT DIVA SINGH, JUDICIAL MEMBER I.T.A .NO.-5644/DEL/2014 (ASSESSMENT YEAR-2009-10) SANJAY, C/O-U.S.BHARGAVA, ADVOCATE, 17, RAM NAGAR, GHAZIABAD. PAN-BOVPS4176P ( APPELLANT) VS ITO, WARD-2(3), GHAZIABAD. (RESPONDENT) ASSESSEE BY SH.C.S.ANAND, ADV. REVENUE BY SH.ANIL SHARMA, SR.DR ORDER THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE A SSAILING THE CORRECTNESS OF THE ORDER DATED 21.08.2014 OF THE CIT(A), GHAZIABAD PERTAINING TO 2009-10 AY ON THE FOLLOWING GROUNDS:- 1. THAT THE LD C.I.T(A) WITHOUT AFFORDING THE REAS ONABLE OPPORTUNITY OF BEING HEARD REGARDING THE VERIFICATION AND THUMB IMPRESSI ON OF NARESH YADAV REJECTED THE CONFERMATION AND COMPLETED THE APPELLA TE PROCEEDINGS AND PASS THE ORDER ACCORDINGLY. 2. THAT BOTH A.O AS WELL AS LD C.I.T(A) WITHOUT GOI NG THROUGH THE CASH FLOW CHART AND WITHOUT CONSIDERING THE DEPOSITS OBTAINED /MADE BY NARESH YADAV BEING COSION HAS SUSTAINED THE ADDITION OF RS .19,48,000/-. 3. THAT THE LD C.I.T (A) ALSO ERRED IN NOT ALLOWING A SHORT TERM CAPITAL LOSS OF RS.3,08,000/-ON THE SALE OF HOUSE AT 101 KRISHNA VI HAR, GHAZIABAD. 4. THAT THE ADDITION AND DISALLOWANCES HAS MADE IN PARA NO 2 AND 3 IS EXCESSIVE ARBITRARY AND UNCALLED FOR AND DESERVE TO BE DELETED. 5. THAT THE APPELLANT CRAVES ITS PLEA TO ADD, AMEND , MODIFY OR DELETE ANY ONE OR MORE OF THE GROUNDS APPEAL BEFORE OR AT THE TIME OF HEARING AND ALL THE ABOVE GROUNDS ARE WITHOUT PREJUDICE TO EACH OTHERS. 2. BOTH THE PARTIES HAVE BEEN HEARD. 3. THE RELEVANT FACTS OF THE CASE ARE THAT THE ASSE SSEE WHO IS ENGAGED IN THE BUSINESS OF TRADING IN MILK, RETURNED AN INCOME OF RS.1,45,360/-. THE SAID RETURN WAS PROCESSED UNDER SECTION 143(1) OF THE INCOME TAX AC T, 1961 AND SELECTED FOR SCRUTINY AS CASH DEPOSIT OF RS.36,40,000/- WAS FOUND TO HAVE BE EN DEPOSITED IN HIS BANK ACCOUNTS DATE OF HEARING 06.09.2016 DATE OF PRONOUNCEMENT 04 .11.2016 I.T .A .NO.-5644/DEL/2014 PAGE 2 OF 4 MAINTAINED WITH THE ALLAHABAD BANK ACCOUNT NO.11495 6 AND PUNJAB AND SINDH BANK ACCOUNT NO.7092. THE ASSESSEE WAS REQUIRED TO EXPLA IN THE SAME. THE EXPLANATION OF THE ASSESSEE WAS ACCEPTED TO THE EXTENT OF DEPOSIT OF RS.11,92,000/- AS HAVING BEEN RECEIVED FROM SALE OF PROPERTY AND CONSIDERING THE TURNOVER OF RS.3,97,000/- DEPOSIT OF RS.5,00,000/- WAS ALSO ACCEPTED. HOWEVER, IN REGARD TO THE REMAINING AMOUNT OF RS.19,48,000/-, THE ASSESSING OFFICER REJECTED THE EXPLANATION OFFERED AND MADE THE ADDITION OF THE SAID AMOUNT. 4. THE ASSESSEE TRAVELLED IN APPEAL BEFORE THE FIRS T APPELLATE AUTHORITY EXPLAINING THAT HIS COUSIN BROTHER, SH. NARESH YADAV HAD SOLD THE PROPERTY AND DEPOSITED THE SALE CONSIDERATION OF RS.15,03,000/- IN HIS BANK ACCOUNT . THE SAID EXPLANATION WAS SUPPORTED BY A CONFIRMATION FROM SH. NARESH YADAV. THE SAID E XPLANATION WAS NOT ACCEPTED BY THE CIT(A) IN VIEW OF THE FACT THAT FIRSTLY THERE WAS NO REQUEST FOR FILING ADDITIONAL EVIDENCES; SECONDLY THE CONFIRMATION WAS BY OF ONLY A THUMB I MPRESSION AND IT DID NOT MENTION IN WHOSE PRESENCE IT WAS AFFIXED NOR WERE THE DETAILS OF THE WITNESSES GIVEN BEFORE WHOM THE IMPRESSION WAS GIVEN. APART FROM THAT THE LD.CI T(A) ALSO WAS OF THE VIEW THAT DURING THE ASSESSMENT PROCEEDINGS THE ASSESSEE HAD STATED THAT THE DEPOSIT WAS MADE FROM THE SALE CONSIDERATION OF HIS PLOTS OF HIS TAU/UNC LE. THUS, THE EXPLANATION NOW OFFERED THAT IT WAS FROM HIS COUSIN WAS FOUND TO BE CONTRAD ICTORY. ACCORDINGLY THE ADDITION TRADE WAS SUSTAINED. 5. APART FROM THIS, THE CIT(A) FURTHER DISALLOWED T HE CLAIM OF A CAPITAL LOSS OF RS.3,08,000/-. THE ASSESSEE SUPPORTED ITS CLAIM PL EADING THAT THE PROPERTY HAD BEEN PURCHASED FROM SHRI RAM PAL SINGH RANA FOR RS.15,00 ,000/- ON 15.05.2008 ON POWER OF ATTORNEY AND THE SUBSEQUENT SALE OF THE SAID PROPER TY TO SH. SHIV KUMAR WAS MADE FOR RS.11,92,000/-. THE SALE WAS REGISTERED IN THE NAM E OF SH. SHIV KUMAR BY THE ORIGINAL OWNER, SHRI. RAM PAL SINGH RANA AS THE SALE TO THE ASSESSEE WAS BY WAY OF POWER OF ATTORNEY ONLY. THE AO REJECTED THE CLAIM HOLDING T HAT THE ASSESSEE NEVER GOT IT I.T .A .NO.-5644/DEL/2014 PAGE 3 OF 4 REGISTERED IN HIS OWN NAME AS IT WAS TRANSFERRED BY THE ORIGINAL OWNER TO THE NEW PURCHASER. 6. THE LD. AR IN THE CONTEXT OF THE ABOVE FACTS SUB MITTED THAT IN THE INTEREST OF JUSTICE, THE ASSESSEE MAY BE PROVIDED AN OPPORTUNIT Y TO FILE FRESH EVIDENCES. AS EVIDENTLY THERE HAS BEEN A MISCARRIAGE OF JUSTICE A S THE ASSESSEES COUNSEL APPEARING BEFORE THE CIT(A) PROBABLY NOT AWARE OF THE PROCED URES ETC. TO BE FOLLOWED, RELIED UPON THE EVIDENCES WITHOUT FIRST PETITIONING U/RULE 46A THAT THEY BEING FRESH EVIDENCES MAY BE ADMITTED AS DUE TO LACK OF APPROPRIATE ADVISE AT T HE ASSESSMENT STAGE THE DOCUMENTS COULD NOT BE FILED. THUS, THE DECISION BASED ON AR GUMENTS AND RELYING UPON EVIDENCES WHICH WERE NOT SUFFICIENT TO EXPLAIN THE CLAIM AND PERMISSION FOR FILING OF FRESH EVIDENCES AS PER STATUTORY RULES AND PROCEDURES MAY BE PROVID ED THE ORDER MAY BE SET ASIDE ON BOTH THE ISSUES. IT WAS HIS SUBMISSION THAT THE EV IDENCES ON WHICH THE ASSESSEE SEEKS TO RELY IN REGARD TO SALE OF THE SPECIFIC PROPERTY SOLD BY SH. NARESH YADAV WHOSE PROCEEDS WERE DEPOSITED IN ASSESSEES BANK ACCOUNT IS NOT SOMETHING WHICH THE ASSESSEE CAN MANUFACTURE. SIMILARLY, PURCHASE OF A SPECIFIC PROPERTY ON A POWER OF ATTORNEY FROM A SPECIFIC PERSON WHICH WAS ULTIMATEL Y SOLD AT A LESSER PRICE TO ANOTHER PERSON ARE NOT DOCUMENTS WHICH CAN BE MANUFACTURED. IT IS ONLY ON ACCOUNT OF NON- AWARENESS ON THE PART OF THE COUNSEL AND THE ASSESS EE BEING IGNORANT ABOUT THE TAX PROCEEDINGS THAT UNCLE-NEPHEW CASUAL REFERENCE HAS BEEN MADE. SIMILARLY, LACK OF PROPER ADVISE IN REGARD TO PROCEDURE WHERE THE COUN SEL HIMSELF WAS NOT AWARE OF THE PROCEDURES HAS RESULTED IN MISCARRIAGE OF JUSTICE. THE SAID PRAYER OF THE LD. AR WAS NOT OBJECTED TO BY THE REVENUE. HOWEVER, IT WAS THE STA ND OF THE LD.SR.DR THAT SINCE FRESH EVIDENCES ARE TO BE FILED THE APPROPRIATE AUTHORITY FOR RESTORING THE ISSUE WOULD BE THE ASSESSING OFFICER. ACCORDINGLY, CONSIDERING THE OV ERALL FACTUAL MATRIX, THE PRAYER OF THE ASSESSEE IS ALLOWED. THE IMPUGNED ORDER IS SET ASI DE AND THE ISSUE IS RESTORED BACK TO I.T .A .NO.-5644/DEL/2014 PAGE 4 OF 4 THE FILE OF THE DECISION OF AO WITH A DIRECTION TO PASS A SPEAKING ORDER IN ACCORDANCE WITH LAW AFTER GIVING THE ASSESSEE A REASONABLE OPPORTUN ITY OF BEING HEARD. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED FOR STATISTICAL PURPOSES. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 04 TH OF NOVEMBER, 2016. SD/- (DIVA SINGH) JUDI CIAL MEMBER *AMIT KUMAR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT A SSISTANT REGISTRAR ITAT NEW DELHI