Shri Om Prakash Gupta, Gwalior V. CIT, Gwalior

ITA 601/AGR/2008

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 6825 (ITAT-AGRA)
• Duration Of Justice: 1 year(s) 9 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-06-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 22-06-2010
• Assessment Year: 2001-2002
• Appeal Filed On: 15-09-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SEEMA RAJ
• Keywords: Gift; Source of fund; Set aside
• Section: 143(3); 147; 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, AGRA BEFORE SHRI R.K. GUPTA, JUDICIAL MEMBER AND SHRI P.K. BANSAL, ACCOUNTANT MEMBER ITA NO.601/AGR/2008 ASST. YEAR: 2001-02 SHRI OM PRAKASH GUPTA, VS. THE COMMISSIONER OF I NCOME-TAX, S/O. SHRI JWALA PD. GUPTA, GWALIOR. 1075, NEW DARPAN COLONY, GWALIOR (M.P.) (PAN : ACDPG 3306 L). (APPELLANT) (RESPONDENT) APPELLANT BY : NONE RESPONDENT BY : SMT. SEEMA RAJ, CIT D.R. ORDER PER P.K. BANSAL, A.M.: THIS APPEAL HAS BEEN FIELD BY THE ASSESSEE AGAINST THE ORDER OF THE CIT DATED 25.03.2008 PASSED UNDER SECTION 263 OF THE INCOME-TAX ACT, 196 1 (THE ACT HEREINAFTER). 2. NONE APPEARED ON BEHALF OF THE ASSESSEE EVEN THO UGH NOTICE WAS DULY SENT TO THE ASSESSEE. WE, THEREFORE, DECIDED TO DISPOSE OF THI S APPEAL AFTER HEARING THE LD. D.R. 3. PROCEEDINGS UNDER SECTION 263 OF THE ACT HAS BEE N INITIATED ON THE BASIS THAT THE A.O. HAS NOT EXAMINED THE QUANTUM AND THE EXTENT OF SOURCES OF INCOME OF ONE OF THE DONOR SHRI AVINASH GUPTA AND ALSO NOT GIVEN ANY FINDINGS REGARDING GEN UINENESS OF THE TRANSACTION. HE HAS ALSO MENTIONED THAT THE A.O. HAS FAILED TO MAKE QUERY OR OBTAINED EVIDENCE REGARDING GENUINENESS 2 AND OCCASION OF THE GIFT. THE ASSESSEE SUBMITTED T HAT THE GIFT WAS RECEIVED FROM SHRI AVINASH GUPTA, SON OF THE ASSESSEE. THE A.O. HAS TAKEN THE ACTION UNDER SECTION 147 OF THE ACT AGAINST THE ASSESSEE AND THE ASSESSEE HAS SUBMITTED ALL THE NECESSARY EVIDENCE INCLUDING CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTION ALONGWITH COPIES OF THE BANK ACCOUNT. AFTER APPLYING HIS MIND AND EXAMINING THE REPORT, THE A.O. DROPPED THE PROCEEDINGS INITIATED UNDER SECTION 147 OF THE ACT. THE CIT DID NOT AGREE BUT HELD THE ORDER PASSED BY THE A.O. DROPPING THE PROCEEDINGS UNDER SECTION 147 TO BE ERRONEOUS AND PREJUDICIAL T O THE INTEREST OF THE REVENUE. 4. WE HAVE HEARD THE SUBMISSIONS MADE BY THE LD. CI T D.R. AND CAREFULLY CONSIDERED THE SAME. IN OUR OPINION, THE CIT IS NOT CORRECT. THE PROCEEDINGS UNDER SECTION 147 WERE INITIATED AND IN REPLY THERETO THE ASSESSEE HAS SUBMITTED THE NECESSARY EVIDENCE WHICH WERE DULY EXAMINED BY THE A.O. AND AFTER EXAMINING THE EVIDEN CE SUBMITTED BY THE ASSESSEE THE A.O. FILED THE PROCEEDINGS INITIATED UNDER SECTION 147. THIS IS NOT A CASE WHERE NO ENQUIRY WAS CONDUCTED BY THE A.O. IF THE A.O. HAS TAKEN ONE OF THE VIEW, UNTIL AND UNLESS THAT VIEW IS NOT UNSUSTAINABLE IN LAW, THE ORDER CANNOT BE REGARDED TO BE ERRONEOU S IN LAW. WE HAVE ALSO GONE THROUGH THE ORDER OF THIS BENCH IN THE CASE OF RADHEY SHYAM AGA RWAL HUF VS. CIT IN ITA NO.399/AGRA/2008 AND OTHERS, CONSISTING OF 135 APPE ALS, IN WHICH ALSO SIMILAR ISSUE WAS INVOLVED AND THE ORDER PASSED UNDER SECTION 263 WAS QUASHED UNDER PARA NO.22. THIS TRIBUNAL HAS HELD AS UNDER:- (22). IT IS APPARENT FROM THE MACROSCOPICAL READIN G OF THE ASSESSMENT ORDERS PASSED U/S 143(3) READ WITH SEC.147 OR THE O RDERS DROPPING THE RE- ASSESSMENT PROCEEDINGS, THAT NO RELATION, CONNECTIO N OR NEXUS OR DIRECT/ INDIRECT LINK WAS FOUND TO EXIST WITH THE ALLEGED SCAM- TAIN TED BANK ACCOUNTS, WHICH WERE USED FOR LAUNDERING OF BLACK- MONEY. EVEN, OTHERWIS E THERE IS NO COGENT PROOF WITH THE DEPARTMENT TO COME TO A VALID CONCLUSION T HAT INCOME HAS ESCAPED 3 ASSESSMENT OR THAT ANY OF THESE ASSESSEE(S) WAS THE BENEFICIARY OR RECIPIENT OF MONEY IN THE GARB OF HUNDI OR GIFT FROM THE ALLEGED TAINTED BANK ACCOUNT(S). IN ALL THESE CASES THE ASSESSEES HAVE FURNISHED ALL THE RE QUIRED AND REQUISITE DOCUMENTS TO PROVE THEIR GIFTS, ETC. THE SATISFACTION, AS ENV ISAGED IN THE ACT, IS THAT OF LD. A.O, WHO HAS SATISFIED HIMSELF REGARDING THE GENUIN ITY OF THE GIFTS ETC, AND THAT IS WHY HE HAS EITHER DROPPED THE (RE) ASSESSMENT PROCE EDINGS OR HAS ACCEPTED THE EXPLANATION OF THE ASSESSEE(S). THE POWER OF LD. CI T ARE NOT UNFETTERED OR UNCHEQUERED. HE CAN ONLY REVISE AN ORDER IF IT IS B OTH ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE, AS HAS BEEN ELABOR ATELY DISCUSSED IN THE EARLIER PART OF THIS ORDER. SO, THE ARGUMENTS OF LD. CIT (D .R.) THAT THERE IS NO LEGAL BAR AGAINST THE ACTION OF LD. CIT IN CASE HE IS OF THE VIEW THAT THE A.O HAS NOT MADE PROPER ENQUIRIES PRIOR TO THE PASSING OF THE RE- AS SESSMENT ORDER TO REVISE THE SAME IS NOT TENABLE. THIS ARGUMENT OF LD. D.R. IS N OT VALID AS PER LAW. THE POWERS OF LD. CIT ARE NOT UNIVERSAL AS SAID ABOVE AND, MOR EOVER, IT IS THE SATISFACTION OF THE A.O WHICH PRIMARILY MATTERS. EVEN, IN A CASE, T HE LD. CIT ARRIVES AT A DIFFERENT CONCLUSION ON SAME SET OF FACTS BUT IF THE LD. A.O HAS TAKEN A DIFFERENT BUT A PLAUSIBLE VIEW, THE SAME CANNOT BE SUBSTITUTED BY L D. CIT BY HIS VIEW. THE OTHER ARGUMENT OF LD. CIT (D.R.) THAT BY SETTING ASIDE AN D RESTORING THE MATTER BACK, THE ASSESSEE SHOULD NOT HAVE GRIEVANCE IS ALSO OF NO MO MENT, THERE HAS TO BE AN END AND FINALITY TO LITIGATION. THE LENGTH OF THE ASSES SMENT ORDER OR THE RE- ASSESSMENT ORDER DOES NOT MATTER IF THE A.O HAS PROPERLY EXAMI NED THE DISPUTED ISSUE(S). THE HONBLE ALLAHABAD HIGH COURT HAS GONE EVEN TO THE E XTENT IN HOLDING THAT EVEN IF THE ORDER OF A.O IS CRYPTIC THIS CAN NOT BE REVIS ED. IT WAS SO HELD IN THE CASE OF CIT VS MAHENDRA KUMAR BANSAL (2008) 297ITR 99(ALL) THAT MERELY BECAUSE THE ITO HAD NOT WRITTEN A LENGTHY ORDER IT WOULD NOT ES TABLISH WITHOUT BRINGING ON RECORD SPECIFIC INSTANCES THAT THE ASSESSMENT ORDER PASSED UNDER SECTION 143(3) /148 OF THE ACT IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. WE ARE IN AGREEMENT WITH LD. CIT (D.R) TO THE EXTENT T HAT THE CIT IS NOT REQUIRED TO COME TO A CONCLUSION TO THE HILT, BUT UNDER THE FOU R- CORNERS OF THE PROVISION OF S.263, HE IS DUTY BOUND TO ESTABLISH THAT THE ORDER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTEREST OF THE REVENUE. HE HAS TO GIVE A FINDING TO THAT EFFECT THAT HOW THE ORDER IS ERRONEOUS AND WHY IT IS PREJU DICIAL TO THE INTEREST OF THE REVENUE. SIMPLY MAKING A GENERAL OBSERVATION WOULD NOT SUFFICE. NOW WE WILL DISCUSS THE POINTS RAISED IN THE WRITTEN SUBMISSION FILED BY THE DEPARTMENT THE FIRST POINT THAT THE A.O COMPLETED THE ASSESSMENTS WITHOUT MAKING ANY INQUIRY THROUGH INSPECTOR OF INCOME TAX IF OF NO AVAIL. THE RE IS NO SUCH LEGAL REQUIREMENT. IT IS THE SATISFACTION OF LD. A.O WHIC H MATTERS AND NOT THE MODE OF INVESTIGATION. FROM THE DOCUMENTS FILED BY THE ASSE SSEES IT BECOMES AMPLY CLEAR THAT THE A.O HAS MADE AMPLE INQUIRIES TO SATISFY TH AT THESE GIFTS ARE GENUINE AND NOT RELATED TO THE REASONS TAKEN FOR RE-OPENING OF ASSESSMENTS. THE A.O HAS VERY MUCH EXAMINED THE IDENTITY OF THE DONOR(S), THEIR C REDITWORTHINESS AS WELL AS GENUINTY OF GIFTS. THE LD. CIT CANNOT GO INTO THE S UFFICIENCY OF THE INVESTIGATION MADE BY LD. A.O. THE A.O HAS EXAMINED THE ORIGIN OF GIFTS, THE SOURCE(S) OF THE DEPOSIT ETC. ALTHOUGH RELATION IS NOT MATERIAL NOW, YET LD. A.O HAS VERIFY AND EXAMINED THE RELATION BETWEEN THE DONOR(S) AND THE DONEE(S). THE GIFT AMOUNT ARE NOT OF VERY HIGH AMOUNTS AS COMPARED TO THE INCOME( S) OF THE DONOR(S). ALL THE 4 DONOR(S) HAVE ACCEPTED THEIR GIFTS, HAVE EXPLAINED THEIR RESPECTIVE SOURCES AND HAVE PAID THEM MOSTLY THROUGH CHEQUES/ DRAFTS. THE DECISION OF HONBLE ALLAHABAD HIGH COURT IN THE CASE OF IISHWARI DEVI V S ITO( SUPRA) IS ON DIFFERENT FACTS. THE FACTS OF THE CASES UNDER REFERENCE ARE E NTIRELY DIFFERENT. WE HAVE EXTENSIVELY DEALT WITH SIMILAR ARGUMENTS OF THE DEP ARTMENT IN THE CASE OF SMT. BABITA ARORA (SUPRA) AND IN THE OTHER CASES REFERRE D TO ABOVE. THE DECISIONS RELIED UPON BY THE DEPARTMENT ARE ON DIFFERENT FOOT ING ARISING OUT OF ENTIRELY DIFFERENT SET OF FACTS. THE A.O HAS MADE THE ENTIRE REQUISITE ENQUIRES, THEREFORE, THE DECISION OF HONBLE SUPREME COURT IN THE CASE O F RAMPYARI DEVI SARAGOI & SMT. TARA DEVI AGGARWAL (SUPRA) RELIED BY LD. CIT(D R) ARE NOT OF ANY HELP TO HER CASES. WE ARE IN AGREEMENT WITH LD. CIT(DR) THAT TH E ORDER DROPPING THE (RE) ASSESSMENT PROCEEDINGS IS A REVISABLE ORDER. WE HAV E, OURSELVES, CAREFULLY TREADED THROUGH EACH AND EVERY CASE BEFORE US AND A RE SATISFIED THAT NONE OF THESE CASES IS FOUND TO BE RELATED WITH THE ALLEGED SCAM CASES. THUS, THERE IS NO POINT IN FURTHER WAITING FOR A ADDITIONAL WRITTEN SUBMISS ION FOR THAT PURPOSE ONLY. 23. THE ABOVE- FINDING IS TRUE IN ALL THE OTHER CAS ES BEFORE US AND, THE AFORESAID REASONING ARE ALSO APPLICABLE TO THEM. TH E FACTS, THE CIRCUMSTANCES, THE REASONS FOR RE- OPENING AND THE INVOLVEMENT OF GIFT (S), ETC, THE NATURE AND EXTENT OF EXAMINATION OF EVIDENCES SO PRODUCED AND THE NOT ICE U/S 263 AND THE REASONS GIVEN IN THE ORDER UNDER APPEAL ARE ALL, MUTATIS MU TANDIS, IDENTICAL, THEREFORE, THE ARGUMENTS, REASONS GIVEN IN THE ABOVE CASE WOULD AL SO APPLY TO ALL OTHER CASES. ALL THESE CASES ARE FULLY COVERED BY THE DECISIONS OF THIS BENCH RENDERED IN THE CASES REFERRED TO ABOVE. THEREFORE, BY RESPECTFULLY FOLLOWING THE ABOVE CASES, REFERRED TO IN THE FORMER PART OF THIS ORDER, WE AC CEPT ALL THESE APPEALS. ACCORDINGLY, WE ALLOW ALL THE ABOVE CAPTIONED APPEA LS OF THE ASSESSEE AND SET ASIDE THE IMPUGNED ORDER(S) OF LD. CIT PASSED IN AL L THESE CASE, AND RESTORE THE ORDER(S) REVISED THEREBY. 5. RESPECTFULLY FOLLOWING THE AFORESAID DECISION OF THIS TRIBUNAL, WE QUASH THE ORDER PASSED BY THE CIT(A) UNDER SECTION 263 OF THE ACT. 6. IN THE RESULT, APPEAL FIELD BY THE ASSESSEE STAN DS ALLOWED. (ORDER PRONOUNCED IN THE OPEN COURT ON 22.06.2010) SD/- SD/- (R.K. GUPTA) (P.K. BANSAL) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE: AGRA DATE: 22 ND JUNE, 2010. PBN/* 5 COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT BY ORDER 3. CIT CONCERNED 4. CIT (APPEALS) CONCERNED 5. DR, ITAT, AGRA BENCH, AGRA 6. GUARD FILE ASSIST ANT REGISTRAR INCOME-TAX APPELLATE TRIBUNAL, AGRA TRUE COPY