Injeti Mahesh, V. DCIT,

ITA 566/BANG/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 0375 (ITAT-BANGALORE)
• Duration Of Justice: 3 year(s) 1 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-06-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 19-05-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 29-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRAMOD KU MAR SINGH
• Assessee Lawyers: G S PRASHANTH
• Keywords: Unexplained cash credit; Opportunity of being heard; Principle of natural justice
• Section: 143(3); 234B; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, BANGALORE BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER ITA NO. 566/ BANG/20 1 3 (ASSESSMENT YEAR: 20 09 - 10 ) SHRI INJETI MAHESH, FLAT NO.301, FORTUNE BANJARA AP ARTMENTS, ROAD NO.3, BANJARA HILLS, HYDERABAD - 50034. PA NO.AIGPM 5959 G VS. APPELLANT DEPUTY COMMISSIONER OF INCOME - TAX, CIRCLE - 1, BELLARY. RESPONDENT APPELLANT BY : SHRI G.S.PRASHANTH, CA. RESPONDENT BY : SHRI PRAMOD KU MAR SINGH,CIT(DR) DATE OF HEARING : 19/05/2016 DATE OF PRONOUNCEMENT : 03 /06/2016 O R D E R PER I NTURI RAMA RAO, AM : THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED AGAINST THE ORDER OF THE CIT(A), HUBLI, DATED 30/01/2013 FOR THE ASSESSM ENT YEAR 2008 - 09. 2. THE ASSESSEE RAISED THE FOLLOWING GROUNDS OF APPEAL: ITA NO . 566 /BANG/201 3 PAGE 2 OF 5 1. THE ORDER OF THE AUTHORITIES BELOW IN SO FAR AS IT IS AGAINST THE APPELLANT, IS OPPOSED TO LAW, WEIGHT OF EVIDENCE, NATURAL JUSTICE, PROBABILITIES, FACTS AND CIRCUMSTANCES OF THE A PPELLANT'S CASE. 2. THE APPELLANT DENIES HIMSELF TO BE ASSESSED ON A SUM OF RS. 11,51,75,938/ - AS AGAINST A SUM OF RS.30,71,210/ - AS DECLARED BY THE APPELLANT UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. THE AUTHORITIES BELOW ERRED IN MAKING AN ADDITION O F RS.11,03,30,000/ - AS UNEXPLAINED CREDITS UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. 4. WITHOUT PREJUDICE, THE AMOUNT ADDED IS WRONG AND REQUIRES TO BE MADE AS NIL ON THE FACTS OF THE CASE. 5. WITHOUT PREJUDICE, THE ADDITION IS BAD IN LAW AS THE PROVISION S OF SECTION 68 OF THE ACT ARE NOT APPLICABLE FOR TRADE CREDITS ON THE FACTS OF THE CASE. 6. THE AUTHORITIES BELOW ERRED IN MAKING AN ADDITION OF RS.7,41,993/ - AS UNEXPLAINED FIXED DEPOSITS UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. 7. THE AUTHORITIES BELO W ERRED IN MAKING AN ADDITION OF RS.9,91,494/ - AS UNEXPLAINED CREDIT CARD EXPENDITURE UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. 8. WITHOUT PREJUDICE, THE AMOUNT ADDED IS WRONG AND REQUIRES TO BE MADE AS NIL ON THE FACTS OF THE CASE. 9. WITHOUT PREJUDICE, T HE ADDITION MADE IS HIGHLY EXCESSIVE AND NEEDS TO BE SUBSTANTIALLY REDUCED UNDER THE FACTS OF THE CASE. 10. THE LEARNED CIT - A ERRED IN NOT PROVIDING A REASONABLE OPPORTUNITY OF BEING HEARD TO THE APPELLANT WHICH IS IN VIOLATION OF THE SETTLED PRINCIPLES OF NA TURAL JUSTICE. 11. THE APPELLANT DENIES HIMSELF LIABLE TO BE LEVIED TO INTEREST UNDER SECTION 234A, 234B AND 234C OF THE ACT AND FURTHER THE COMPUTATION OF ITA NO . 566 /BANG/201 3 PAGE 3 OF 5 INTEREST WAS NOT PROVIDED TO THE APPELLANT AS REGARD TO THE RATE, PERIOD AND METHOD OF CALCULATION OF I NTEREST UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. 12. THE APPELLANT CRAVES LEAVE TO ADD, ALTER, DELETE OR SUBSTITUTE ANY OF THE GROUNDS URGED ABOVE. 13. IN VIEW OF THE ABOVE AND OTHER GROUNDS THAT MAY BE URGED AT THE TIME OF THE HEARING OF THE APPEAL, THE APPELLANT PRAYS THAT THE APPEAL MAY BE ALLOWED IN THE INTEREST OF JUSTICE AND EQUITY. 3. BRIEFLY FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL DERIVING INCOME FROM BUSINESS OF TRADING IN IRON ORE. RETURN OF INCOME FOR ASSESSMENT YEAR 20 09 - 10 WAS FILED ON 28/10/2009 DECLARING A TOTAL INCOME OF RS.30,71,210/ - . AFTER PROCESSING THE RETURN OF INCOME UNDER THE PROVISIONS OF SEC.143(1) OF THE INCOME - TAX ACT, 1961 [HEREINAFTER REFERRED TO AS 'THE ACT' FOR SHORT] THE RETURN OF INCOME WAS TAKEN UP FOR SCRUTINY ASSESSMENT AND THE ASSESSMENT WAS COMPLETED U/S 143(3) VIDE ORDER DATED 31/12/2011 AT A TOTAL INCOME OF RS.11,51,75,938/ - AFTER MAKING THE FOLLOWING ADDITIONS: I. UNEXPLAINED CREDITS OF RS.11,03,30,000/ - II. UNEXPLAINED FIXED DEPOSITS OF RS.7,41,9 93/ - III. UNEXPLAINED CREDIT CARD EXPENDITURE RS.9,91,494/ - DURING THE COURSE OF ASSESSMENT PROCEEDINGS , THE ASSESSING OFFICER (AO) OBSERVED THAT THE ASSESSEE HAD FAILED TO EXPLAIN SUNDRY CREDITORS OF RS.11,03,30,000/ - AND BROUGHT THE SAME TO BE UNDER THE PROV ISIONS OF SEC.68 OF THE ACT. 4. BEING AGGR IE VED , AN APPEAL WAS PREFERRED BEFORE THE CIT(A) WHO CONFIRMED THE SAME HOLDING THAT DESPITE SEVERAL ITA NO . 566 /BANG/201 3 PAGE 4 OF 5 NOTICES OF HEARING, THERE WAS NO COMPLIANCE TO THE HEARING NOTICES. 5. BEING AGGRIEVED, ASSESSEE IS IN PRESENT APPEAL BEFORE US. LEARNED AR OF THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAD DISCHARGED INITIAL ONUS OF FILING DETAILS OF SUNDRY CREDITORS SUCH AS NAME, ADDRESS, PA NO. AND THE MODE OF RECEIPT OF AMOUNT FROM THE ABOVE PARTIES. THE AO MERELY MADE ADDITION DISBELIEVING THE EXPLANATION OF THE ASSESSEE. LEARNED AR OF THE ASSESSEE FURTHER SUBMITTED THAT THE ASSESSEE COULD NOT REPRESENT BEFORE THE CIT(A) ON ACCOUNT OF HIS HOSPITALIZATION AT HYDERABAD. NOTICE OF HEARING WAS NOT SERVED ON THE ASSESSEE ON ACCOUNT OF SHIFTING THE PLACE OF RESIDENCE FROM BELLARY TO HYDERABAD OWING TO HIS ILLNESS. IN THE CIRCUMSTANCES, HE PRAYED THAT THE ISSUE MAY BE REMANDED BACK FOR FRESH ADJUDICATION TO THE FILE OF THE CIT(A). ON THE OTHER HAND, LEARNED DEPARTMENTAL RE PRESENTATIVE HAD NO SERIOUS OBJECTION TO THE PLEA CANVASSED BY THE LEARNED AR OF THE ASSESSEE. 6. AFTER HEARING THE RIVAL SUBMISSION AND GOING THROUGH THE RECORD, WE ARE OF THE CONSIDERED OPINION THAT IN THE INTEREST OF JUSTICE, THE MATTER SHOULD BE R EMANDED BACK TO THE FILE OF THE CIT(A) FOR FRESH ADJUDICATION AS THE CIT(A) HAD NOT DECIDED THE MATTER ON MERITS. WE, ACCORDINGLY, REMIT THE MATTER BACK TO THE FILE OF THE CIT(A) FOR DE NOVO ADJUDICATION. ITA NO . 566 /BANG/201 3 PAGE 5 OF 5 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS T REATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 03 RD JUNE , 2016 SD/ - SD/ - (VIJAY PAL RAO) (INTURI RAMA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE : BANGALORE D A T E D : 03 /0 6 /2016 SRINIVASULU, SPS COPY TO : 1 APPELLANT 2 RESPONDENT 3 CIT(A) - II BANGALORE 4 CIT 5 DR, ITAT, BANGALORE. 6 GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME - TAX APPELLATE TRIBUNAL BANGALORE