Pankaj Sapra, New Delhi V. ITO, Ward- 23(2), New Delhi

ITA 5746/DEL/2018

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 5786 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 7 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-04-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2006-2007
• Appeal Filed On: 06-09-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained investment; Set aside
• Section: 143(1); 147; 68; 69; 148

Judgement Text

ITA. 5746/DEL/2018. IN THE INCOME TAX APPELLATE TRIBUNAL [ DELHI BENCH : SMC1 NEW DELHI ] BEFORE SHRI N. K. BILLAIYA, ACCOUNTANT MEMBER, S. M. C. ITA. NO. 5746/DEL/2018 ASSESSMENT YEAR : 2006-07 (THROUGH VIDEO CONFERENCING) SHRI PANKAJ SAPRA, H1481, 1 ST FLOOR, C. R. PARK, NEW DELHI 110 019. PIN : BBOPS2128D (APPELLANT) VS. INCOME TAX OFFICER, WARD : 23 (2), NEW DELHI. (RESPONDENT) ASSESSEE BY : SHRI SATYAJEET GOEL, C. A.; DEPARTMENT BY : SHRI R. K. GUPTA, SR. D.R.; O R D E R THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST THE ORDER OF THE CIT (APPEALS)- 31, NEW DELHI, DATED 31.07.2018 PERTAINING TO ASSESSMENT YEAR 2006-07. 2. THE ASSESSEE HAS CHALLENGED THE ORDER OF THE CIT (APPEALS) STATING THAT THE ASSUMPTION OF JURISDICTION UNDER SECTION 148 OF THE INCOME TAX ACT, 1961 (THE ACT) WAS WITHOUT PROPER APPRECIATION OF FACTS AND FURTHER THE CIT (APPEALS) ERRED IN CONFIRMING THE ADDITION MADE BY THE ASSESSING OFFICER UNDER SECTION 68 & 69 OF THE ACT. 3. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT THE ASSESSEE FILED RETURN OF INCOME ON 4.01.2007 DECLARING TAXABLE INCOME OF RS.1,26,000/-. THE RETURN WAS PROCESSED UNDER SECTION 143(1) OF THE ACT AND SUBSEQUENTLY RE-OPENED UNDER SECTION 148 OF THE ACT ON THE BASIS OF THE INFORMATION RECEIVED FROM ADIT (INVESTIGATION WING) UNIT-V, NEW DELHI. DATE OF HEARING 2 8 .0 4 .2021 DATE OF PRONOUNCEMENT 2 8 .0 4 .2021 ITA. 5746/DEL/2018. 4. THE REASONS RECORDED FOR INITIATING PROCEEDINGS UNDER SECTION 148 OF THE ACT, READ AS UNDER :- SD/- (UMESH KUMAR) INCOME TAX OFFICER WARD-23(2), NEW DELHI. REASONS RECORDED FOR INITIATING PROCEEDINGS U/S.148 OF THE I.T.ACT 1961 IN THE CASE OF SHRI PANKAI SAPRA FBBOPS2128D FOR THE A.Y.2006-07 THE ADDL. DIRECTOR INCOME TAX (INV.), UNIT-V, NEW DELHI, VIDE HIS LETTER F.NO. ADDL. DIT(INV.)/U-V/2011-12/251, DATED 16.03.2012 HAD SENT A REPORT IN THE CASE OF SHRI PANKAJ SAPRA. AS PER THE INVESTIGATIONS MADE, THE ASSESSEE HAD DEPOSITED UNACCOUNTED CASH IN HIS BANK ACCOUNT. THE DETAILS ARE AS FOLLOWS:- 1. UNEX PLAINED CASH DEPOSIT:- ' IN VIEW OF THE ABOVE MENTIONED FACTS, THE CASH UNEXPLAINED DEPOSITS T, ARE LIABLE TO TAX U/S 68 & 69 OF THE INCOME TAX ACT, 1961. THE INCOME HAS ESCAPED ASSESSMENT IN THE CASE OF SHRI PANKAJ SAPRA FOR A.Y. 2006-07 TO THE J EXTENT OF RS. 30,67,392/-, AS PER THE PROVISIONS OF THE INCOME TAX ACT 1961. 1 IN VIEW OF THE ABOVE MENTIONED FACTS, I HAVE REASON TO BELIEF THAT INCOME TO THE TUNE OF RS 3067392/- HAS ESCAPED ASSESSMENT WITHIN THE MEANING OF SECTION 147 OF THE INCOME TAX ACT, 1961. ACCORDINGLY, NECESSARY PERMISSION / APPROVAL UNDER SECTION 151(2) OF THE INCOME TAX ACT, 1961 MAY KINDLY BE ACCORDED FOR ISSUANCE OF NOTICE U/S 148 OF THE INCOME TAX ACT FOR A.Y. 2006-07. A.Y. 2006 - 07 RS. 13,67,392/ - 2. UNEXPLAINED INVESTMENTS: - A.Y. 2006 - 07 RS. 17,00,000/ - ITA. 5746/DEL/2018. 5. THE UNEXPLAINED DEPOSIT AND UNEXPLAINED INVESTMENT AS CARVED OUT FROM THE REPORT IS AS UNDER :- 6. WHILE SUBMITTING THE REPORT THE INVESTIGATING WING CLEARLY MADE OUT THAT THE ASSESSING OFFICER SHOULD GO THROUGH THE BANK STATEMENT AND OTHER DOCUMENTS TO ARRIVE AT THE INCOME ESCAPING ASSESSMENT BEFORE ISSUING NOTICE UNDER SECTION 148 OF THE ACT. 7. A PERUSAL OF THE BANK STATEMENT SHOW THAT IN VIJAYA BANK RS.50,000/- WAS A TRANSFER ENTRY AND NOT CASH DEPOSIT. FURTHER HDFC BANK ACCOUNT SHOW THAT ENTRY OF RS.25,000/- IS NOT A CASH DEPOSIT , BUT AGAIN A TRANSFER ENTRY. IN SPITE OF THE SPECIFIC INSTRUCTIONS MADE BY THE ADIT, THE ASSESSING OFFICER ASSUMED JURISDICTION UNDER SECTION 148 OF THE ACT WITHOUT VERIFYING THE BANK DETAILS AND WITHOUT VERIFYING THE ACTUAL CASH DEPOSITED DURING THE YEAR UNDER CONSIDERATION. 8. ON IDENTICAL SET OF FACTS IN ASSESSMENT YEAR 2007-08 THE ASSESSMENT OF THE ASSESSEE WAS RE-OPENED AND THE DISPUTE TRAVELLED UP TO THE TRIBUNAL AND THE TRIBUNAL IN ITA. 4253 (DEL) OF 2018 VIDE ORDER DATED 29.03.2019 HAS SET ASIDE THE RE-OPENING. THE RELEVANT FINDINGS OF THE CO-ORDINATE BENCH HELD AS UNDER :- UNEXPLAINED DEPOSITS ASST. YEAR(S) S.N. ARORA DAYA SAPRA PANKAJ SAPRA 2005 - 06 26,95,000/ - 95,84,650/ - 7,43,943/ - / 2006 - 07 2,82,70,090/ - 30,76,500/ - 13,67,392/ - ? 2007 - 08 86,86,537/ - 9,83,622 4,97,452/ - 2008 - 09 55,03,285/ - 1,56,000/ - 23,48,615/ - 2009 - 10 3,63,265/ - 3,22,500/ - 36,82,399/ - * 2010 - 11 27,4,99,150 4,84,219/ - 5,96,817/ - 2011-12 I _ 44,13,287/ - UNEXPLAINED INVESTMENTS ASST, YEAR(S) S.N. ARORA DAYA SAPRA PANKAJ SAPRA 2005 - 06 28,00,000/ - - - V'2006 - 07 94,00,000/ - - 17,00,000/ - * 2008 - 09 56,00,000/ - 27,27,350/ - 27,27,350/ - ITA. 5746/DEL/2018. I HAVE CONSIDERED THE RIVAL SUBMISSIONS MADE BY BOTH THE SIDES AND PERUSED THE ORDERS OF THE AUTHORITY BELOW. I FIND THE AO ON THE BASIS OF THE INFORMATION RECEIVED FROM THE INVESTIGATION WING OF THE DEPARTMENT THAT THE ASSESSEE HAS MADE CASH DEPOSIT OF RS. 4,97,452/- REOPENED THE ASSESSMENT BY ISSUING NOTICE UNDER SECTION 148 AND THEREAFTER MADE ADDITION OF RS. 4,97,452/- TO THE TOTAL INCOME OF THE ASSESSEE BY INVOKING THE PROVISIONS OF SECTION 68 OF THE I.T. ACT, 1961. I FIND THE LEARNED CIT(A) UPHELD THE ACTION OF THE AO, THE REASONS OF WHICH HAVE ALREADY BEEN REPRODUCED IN THE PRECEDING PARAGRAPH. IT IS THE SUBMISSION OF THE LEARNED COUNSEL FOR THE ASSESSEE THAT THERE IS COMPLETE NON APPLICATION OF MIND OF THE AO WHILE RECORDING THE REA SONS AND HE HAS NOT VERIFIED THE FACTS PROPERLY AND THE REOPENING WAS MADE ON THE BASIS OF REPORT OF THE INVESTIGATION WING. FURTHER THE DEPOSITS IN THE BANK ACCOUNTS ARE FULLY EXPLAINED AND THEREFORE NO ADDITION IS CALLED FOR. 9. I FIND FORCE IN THE ABOVE AR GUMENTS ADVANCED BY THE LEARNED COUNSEL FOR THE ASSESSEE. A PERUSAL OF THE NOTICE ISSUED UNDER SECTION 148 SHOWS THAT THE NOTICE HAS BEEN ISSUED IN A VERY CASUAL MANNER, CLAUSE 3 OF THE NOTICE READS AS UNDER:- 'NOTICE UNDER SECTION 148 OF THE INCOME TAX ACT, 1961 . 3. THIS NOTICE IS BEING ISSUED AFTER OBTAINING THE NECESSARY SATISFACTION OF THE COMMISSIONER OF INCOME TAX /THE CENTRAL BOARD OF DIRECT TAXES.' 10. SIMILARLY, A PERUSAL OF THE BANK ACCOUNT MAINTAINED WITH VIJAYA BANK ACCOUNT NO. 004427, COPY OF WHICH HAS BEEN PLACED AT PAGE NO. 25 AND 26 OF THE PAPER BOOK, SHOWS THAT AN AMOUNT OF RS. 2,50,000/- WAS BY WAY OF CLEARING OF CHEQUE NO. 719443 AND NOT CASH DEPOSIT. IF THE SAME IS EXCLUDED FROM THE TOTAL DEPOSITS MADE DURING THE YEAR FROM THE TWO BANK A CCOUNTS THEN THERE IS NO SUCH CASH DEPOSIT OF RS. 4,97,452/- IN THE TWO BANK ACCOUNTS MAINTAINED BY THE ASSESSEE. THEREFORE, I FIND FORCE IN THE ARGUMENT OF LEARNED COUNSEL FOR THE ASSESSEE THAT THE REASONS RECORDED ARE EITHER VAGUE REASONS OR NOT BASED ON ANY APPLICATION OF MIND. ITA. 5746/DEL/2018. 9. ON FINDING PARITY OF THE FACTS OF RE-OPENING, RESPECTFULLY FOLLOWING THE DECISION OF THE CO-ORDINATE BENCH (SUPRA) I AM OF THE CONSIDERED VIEW THAT THE RE-OPENING IS BAD IN LAW AND ACCORDINGLY THE ASSESSMENT IS QUASHED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 28 TH DAY OF APRIL, 2021. SD/- ( N. K. BILLAIYA ) ACCOUNTANT MEMBER DATED : 28/04/2021. *MEHTA* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI DATE OF DICTATION 28.04.2021 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 28.04.2021 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER 28.04.2021 DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS 28.04.2021 DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 28.04.2021 DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS 28.04.2021 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 28.04.2021 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 28.04.2021 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK