Dhoom Singh, Meerut V. ITO, Baraut

ITA 5867/DEL/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 6221 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 4 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-01-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 14-09-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BIHARA
• Assessee Lawyers: V K GOEL
• Keywords: Unexplained cash credit; Opportunity of being heard; Additional evidence
• Section: 44AD; 143(3); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (MEERUT CAMP, MEERUT) BEFORE SHRI N.S.SAINI, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER ITA NO.5867/DEL./2017 (ASSESSMENT YEAR : 2013-14) DHOOM SINGH VS. ITO, C/O. SH. VIKRAM SINGH, BARAUT VIII, & PO. TILWARA, CHHAPRAULI, MEERUT UTTAR PRADESH (PAN : AAGHA0581A) APPELLANT RESPONDENT ASSESSEE BY : SH. V.K.GOEL, ADV. REVENUE BY : SHRI M.R.BIHARA, SR.DR DATE OF HEARING : 11.01.2019 DATE OF ORDER : 25.01.2019 O R D E R PER KULDIP SINGH, JUDICIAL MEMBER : THE APPELLANT DHOOM SINGH (HEREINAFTER REFE RRED TO AS 'THE ASSESSEE') BY FILING THE AFORESAID APPEAL, SOUGHT TO SET ASIDE THE IMPUGNED ORDER DATED 04/09/2017 PASSED BY LD. COMMISSIONER OF IN COME TAX(APPEALS)-MEERUT QUA THE ASSESSMENT YEAR 2013-1 4 ON THE GROUNDS INTER ALIA THAT : 1. THAT ESTIMATION OF NET PROFIT @ 8% OF THE GROSS RECEIPTS BY INVOKING PROVISION U/S 44AD RS. 10,22,8 90/- IS NOT ACCORDING TO LAW. BECAUSE NEITHER BOOKS OF A/C REJECTED NOR SECTION 44AD IS APPLICABLE. A.O. HAS CONSIDERED PAST HISTORY OF THE CASE. ITA NO.5867/DEL./2017 2 2. THAT A.O. IS ERRED IN LAW THAT RS. 7,50,000/- CAN BE ADDED AS UNSECURED LOAN, WHEN A.O. HAS ASSESSED THE INCOME @ 8% OF THE GROSS RECEIPTS, THAN NO OTHER AD DITION CAN BE MADE AND LD. CIT(A) IS IN ERROR TO CONFIRMED THE SAME. 3. THAT A.O. HAS ADDED CREDIT IN BANK ACCOUNT OF RS. 66,73,340/- AS UNEXPLAINED CREDIT ENTRIES, AS A.O. HAS ESTIMATED NET PROFIT @ 8% , NO OTHER ADDITION CAN B E MADE IN THE TOTAL INCOME OF THE ASSESSEE AND CIT(A) IS I N ERROR TO CONFIRMING RS. 14,67,952/-. 4. THAT THE A.O. HAS MADE ADDITION OF RS. 3,00,000/-, HOWEVER THE ASSESSEE HAS SHOWN RS. 96,000/- FROM HI S ACCOUNT AND WITHDRAWAL RS. 72,400/- FROM HIS WIFE A CCOUNT AND RS. 48,000/- FROM HIS AGRICULTURE INCOME. THERE FORE, ADDITION OF RS. 3,00,000/- IGNORING THE WITHDRAWAL SHOWN BY THE ASSESSEE IS NOT CORRECT AND CIT(A) HAS NOR JUST IFIED TO CONFIRMED RS. 60,000/-. 5. THAT THE ASSESSEE HAS RIGHT TO ADD, MODIFY OR DELE TE ANY GROUND DURING THE APPEAL PROCEEDING. 2. BRIEFLY STATED THAT FACTS NECESSARY FOR ADJUDI CATION OF THE CONTROVERSY AT HAND ARE : ASSESSING OFFICER COMPLETED THE ASSES SMENT U/S 143(3) OF THE ACT BY ESTIMATING THE NET PROFIT @ 8% OF THE GROSS RECEIPTS BY INVOKING PROVISIONS CONTAINED U/S 44AD OF THE ACT AND THEREB Y MADE ADDITION OF RS 10,22,890/-, WITHOUT REJECTING THE BOOKS OF ACCO UNTS. 3. ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) BY WAY OF FILINBG THE APPEAL WHO HAS PARTLY ALLOWED THE SAME. FEELING AGGRIEVED THE ASSESSEE COME UP THE TRIBUNAL BY WAY OF PRESENT APP EAL. ITA NO.5867/DEL./2017 3 4. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVES OF THE PARTIES TO THE APPEAL, GONE THROUGH THE DOCUMENTS RELIED UPON AND ORDERS PASSED BY THE REVENUE AUTHORITIES BELOW IN THE LIGHT OF THE F ACTS AND CIRCUMSTANCES OF THE CASE. 5. THE ASSESSEE BY MOVING SEPARATE APPLICATION SOUG HT TO RAISE ADDITIONAL GROUND ON THE GROUND THAT FROM THE PERUS AL OF IMPUGNED ORDER PASSED BY LD. CIT(A) AT PAGE NO. 4 AND 5 IT IS NOT CLEAR BUT APPEARS THAT THE LD. CIT(A) HAS CONFIRMED THE ADDITION OF RS. 44 ,56,338/- U/S 68 OF THE ACT. ADDITIONAL GROUNDS SOUGHT TO BE RAISED IS AS U NDER :- 6. THAT THE A.O. AS WELL AS CIT(A) IS IN ERROR TRE ATING THE DIFFERENCE OF 26 AS CONTRACTUAL RECEIPT AS INCOME. 6. KEEPING IN VIEW THE FACT THAT THE ADDITIONAL GRO UND SOUGHT TO RAISED BY THE ASSESSEE GOES TO THE ROOTS OF THE CASE AS TH E LD. CIT(A) HAS MADE ADDITION OF RS. 44,55,338/- U/S 68 OF THE ACT BY NO TICING THE DIFFERENCE OF 26AS CONTRACTUAL RECEIPT AS INCOME, THE APPLICATION FOR ADDITIONAL EVIDENCE IS HEREBY ALLOWED. 7. GROUND NO. 1 :- THE LD. AR FOR THE ASSESSEE CONTENDED THAT UNDISPUTEDLY AO AS WELL AS LD. CIT(A) HAS MADE THE ADDITION OF RS 10,2 2,890/- BY ESTIMATING THE NET PROFIT RATE OF 8% ON THE TOTAL TURN OVER O F RS. 1,27,86,122/- (1,72,42,460/- LESS 44,55,338/- SEPARATELY CONSIDER ED ) ON FAILURE OF THE ASSESSEE TO PRODUCE THE BOOKS OF ACCOUNTS, BILLS AN D VOUCHERS BY INVOKING PROVISIONS CONTAINED U/S 44AD OF THE ACT. 8. HOWEVER THIS ISSUE IS ALREADY COVERED IN FAVOUR OF THE ASSESSEE IN AY 2012-13 VIDE ITA NO. 1588/DEL/2017. IN A.Y. 2012 -13 ALSO NET PROFIT RATE OF THE ASSESSEE WAS ESTIMATED AT 8% AND THE CO -ORDINATE BENCH OF THE ITA NO.5867/DEL./2017 4 TRIBUNAL AFTER CONSIDERING FACTS AND CIRCUMSTANCES OF THE CASE SET ASIDE THIS ISSUE TO THE FILE OF AO TO DECIDE AFRESH BY PR OVIDING AN OPPORTUNITY OF BEING HEARD AND IN CASE THE ASSESSEES IS AGAIN UNAB LE TO PRODUCE THE BOOKS OF ACCOUNTS OR OTHER DETAILS, THE INCOME IS TO BE D ETERMINED BY APPLYING THE NET PROFIT RATE IN VIEW OF THE PAST HISTORY OF THE ASSESSEE. IN THESE CIRCUMSTANCES FOLLOWING THE DECISION RENDERED BY CO -ORDINATE BENCH OF TRIBUNAL IN ASSESSEES OWN CASE FOR A.Y. 2012-13, W E SET ASIDE THIS ISSUE TO AO TO DECIDE AFRESH AFTER PROVIDING AN OPPORTUNI TY OF BEING HEARD AND IN CASE BOOKS OF ACCOUNT AND OTHER DETAILS ARE NOT PRODUCED BY THE ASSESSEE THEN NET PROFIT BE DETERMINED KEEPING IN VIEW THE PAST HISTORY OF THE ASSESSEE. SO GROUND NO. 1 IS DETERMINED IN FAV OUR OF THE ASSESSEE FOR STATISTICAL PURPOSES. 9. GROUND NO. 2 TO 5 :- GROUND NO. 2 TO 5 ARE DETERMINED AGAINST THE ASSES SEE HAVING NOT BEEN PRESSED DURING THE COURSE OF ARGUMENT. 10. ADDITIONAL GROUND : AO AS WELL AS LD. CIT(A) HAS MADE THE ADDITION OF RS. 44,56,338/- AFTER NOTICING THE P/L ACCOUNT WHEREIN THE CONTRACT RECEIPT WERE SHOWN AT RS. 1,72,42,460/- WHEREAS AS PER FORM 26AS THESE RE CEIPTS WHERE OF RS. 1,27,86,122/- AND THEREBY ADDED THE DIFFERENCE OF R S. 44,56,338/-. IT IS CASE OF THE ASSESSEE THAT THE DIFFERENCE OF RS. 44, 56,338/- IS THE RECEIPT AGAINST THE SUPPLY OF RODI, DUST ETC. FROM TWO DIF FERENT PARTIES. ON FAILURE OF THE ASSESSEE TO PROVIDE NAMES, ADDRESSES AND BA NK STATEMENT OF THE PERSONS WHOM RODI, DUST ETC. WERE SUPPLIED AO MADE THE ADDITION U/S 68 OF THE ACT. 11. IDENTICAL ISSUE WAS COME UP BEFORE THE CO-ORDIN ATE BENCH OF TRIBUNAL IN ASSESSEES OWN CASE FOR A.Y. 2012-13 WH ICH WAS SET ASIDE TO THE FILE OF AO TO DECIDE AFRESH IN ACCORDANCE WITH LAW AFTER PROVIDING ITA NO.5867/DEL./2017 5 OPPORTUNITY OF BEING HEARD BY RETURNING FOLLOWING F INDINGS :- 18. AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE PARTIES AND MATERIAL AVAILABLE ON RECORD, WE ARE OF THE VIE W THAT THE DIFFERENCE IN THE GROSS RECEIPTS SHOWN BY THE ASSES SEE AND REFLECTED IN 26AS CANNOT BE ADDED IN TOTO PARTICULA RLY WHEN THE AO HIMSELF APPLIED NET PROFIT RATE ON THE RECEI PTS SHOWN BY THE ASSESSEE. WE, THEREFORE, BY CONSIDERING THE TOTALITY OF THE FACTS ARE OF THE VIEW THAT REASONABLE NET PROFI T RATE AFTER CONSIDERING THE PAST HISTORY OF THE ASSESSEE SHALL BE APPLIED ON THE DIFFERENCE OF RS. 3,27,850/-, IF THE ASSESSE E IS NOT IN A POSITION TO RECONCILE THE SAID DIFFERENCE. ACCORDIN GLY, THIS ISSUE IS ALSO SET ASIDE TO THE FILE OF THE AO TO BE ADJUDICATED AFRESH IN ACCORDANCE WITH LAW AFTER PROVIDING DUE AND REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESS EE. 12. FOLLOWING THE DECISION RENDERED BY CO-ORDINATE BENCH OF TRIBUNAL THIS ISSUE IS ALSO REMANDED BACK TO THE AO TO DETER MINE THE REASONABLE NET PROFIT RATE KEEPING IN VIEW THE PAST HISTORY OF THE ASSESSEE ON THE AMOUNT OF RS. 44,55,338/- IN CASE THE ASSESSEE HAS FAILED TO RECONCILE THE DIFFERENCE. CONSEQUENTLY ADDITIONAL GROUND NO. 6 IS DETERMINED IN FAVOUR OF ASSESSEE FOR STATISTICAL PURPOSE. 13. IN VIEW OF WHAT HAS BEEN DISCUSSED ABOVE THE PRESENT APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED IN OPEN COURT ON THIS 25 TH JANUARY, 2019. SD/- SD/- (N.S.SAINI) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 25/01/2019 ITA NO.5867/DEL./2017 6 *BR* COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-XXVI, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI. DATE OF DICTATION 15.01.2019 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 16.01.2019 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER 16.01.2019 DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS 25.01.2019 DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 25.01.2019 DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS 25.01.2019 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 25.01.2019 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER