SHIMBHU DYAL, NOIDA V. ITO, WARD- 3(4), NOIDA

ITA 6117/DEL/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 3133 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 5 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-03-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 25-09-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JAGDISH SINGH
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 250; 143(2)

Judgement Text

1 ITA NO. 6117/DEL/2018 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SM C NEW DELHI BEFORE MS SUCHITRA KAMBLE, JUDICIAL MEM BER, AND SHRI PRASHANT MAHARISHI, ACCOU NTANT MEMBER ITA NO. 6117/DEL/2018 ( A.Y 2014-15) SHIMBHU DYAL CHAMAN SINGH, B-6, BASEMENT, J S ARCADE, NEAR BIKANEERWALA, OPP. METRO PILLR 65, SECTOR-18, NOIDA PAN: CMAPD7147R (APPELLANT) VS ITO WARD- 3(4) NOIDA, UTTAR PRADESH (RESPONDENT) APPELLANT BY SH. SATYAJEET GOYAL, CA RESPONDENT BY SH. JAGDISH SINGH, SR. DR ORDER PER SUCHITRA KAMBLE, JM THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER DATED 30/05/2017 PASSED BY INCOME TAX OFFICE, NOIDA, FOR ASSESSMENT YEAR 2014-15. 2. THE GROUNDS OF APPEAL ARE AS UNDER:- (ADDITIONAL GROUNDS) 1(I)THAT ON FACTS AND CIRCUMSTANCES OF THE CASE, TH E LD. CIT(A) WAS NOT JUSTIFIED IN UPHOLDING ADDITION OF RS. 10,80,000/- U/S 68 ON ACCOUNT OF UNEXPLAINED DEPOSIT IN THE BANK EVEN THOUGH SAME IS ILLEGAL AND WITHOUT JURISDICTION. (II) THAT THE CASE HAVING BEEN SELECTED FOR LIMITED SCRUTINY AS PER CASS GUIDELINES ON THE GROUND OF LARGE AGRICULTURAL INCO ME IN THE ITR, THE IMPUGNED ADDITION OF CASH DEPOSIT IN THE BANK ACCOUNT WITHOU T CONVERTING THE CASE INTO COMPLETE SCRUTINY OR TAKING APPROVAL OF SUPERIOR AU THORITY IS INVALID AND VOID- DATE OF HEARING 25.02.2020 DATE OF PRONOUNCEMENT 11.03.2020 2 ITA NO. 6117/DEL/2018 AB-INITIO. GROUNDS 1. THAT THE IMPUGNED ASSESSMENT ORDER PASSED BY THE LD . AO IS BAD IN LAW, WRONG ON FACTS AND AGAINST THE PRINCIPAL OF NATURAL JUSTICE HENCE IS UNSUSTAINABLE. THAT THE IMPUGNED ASSESSMENT ORDER P ASSED BY THE LD. AO IS WRONG, HAVING NO BASE AND AGAINST THE CIRCUMSTANCE OF THE CASE. 2. LD. ASSESSING OFFICER AND LD. CIT(A), HAD PASSED O RDER U/S 144/147 AND 250 RESPECTIVELY WITHOUT PROVIDING AN OPPORTUNITY O F BEING HEARD. 3. THAT ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE ASSESSING OFFICER HAD ERRED IN ASSESSING THE INCOME TAX OF TH E APPELLANT AT RS.12,96,770 /-, PLEASE BE DELETED. 4. THAT THE LD. ASSESSING OFFICER AND LD. CIT (A) HAD ERRED ON FACTS THAT, ASSESSEE IS FARMER AND EARNS HIS INCOME FROM AGRICU LTURE AND ASSESSEE HAD ALSO RECEIVED COMPENSATION AND ASSESSEE DEPOSITED T HESE AMOUNTS IN HIS SAVING ACCOUNT DURING THE YEAR. 5. THAT THE LD. ASSESSING OFFICER AND LD. CIT (A) HAD ERRED ON FACTS THAT, ASSESSEE HAD DEPOSITED RS. 10,80,000.00 IN HIS SAVI NG ACCOUNT, THAT AMOUNT WAS GIVEN BY HIS SON SHRI KAILASH CHAND 6. THAT THE LD. ASSESSING OFFICER AND LD. CIT (A), HA D ERRED ON FACTS THAT, ASSESSEE HAD AGRICULTURE INCOME OF RS. 2,09,386.00, ASSESSEE HAS RECEIVED NOTICE FOR NON-FILING OF INCOME TAX RETURN IN RESPO NSE TO THAT HE HAS FILED HIS RETURN OF INCOME, DECLARING HIS AGRICULTURAL INCOME OF RS. 20,93,870.00 WRONGLY, AFTER THAT HE REALIZED THAT ONE DIGIT WAS WRONGLY WRITTEN IN HIS RETURN OF INCOME, HE HAS SUBMITTED HIS SUBMISSION R EGARDING HIS MISTAKE IN RETURN OF INCOME BEFORE LD. ASSESSING OFFICER AND L D CIT(A). 7. THE ADDITION MADE BY THE A.O. IS DEVOID OF ANY MERI TS AND IS AWAY FROM THE FACTUAL MATRIX OF THE CASE AND BASED ON JUST AN IMAGINATION AND ON FLIMSY GROUND. SUBMISSION WAS NOT MADE BY THE ASSESSEE BEC AUSE OPPORTUNITY OF BEING HEARD HAD NOT BEEN PROVIDED. 8. THE ASSESSMENT ORDER IS THEREFORE ILLEGAL BEING IN VIOLATION OF THE PRINCIPAL OF NATURAL JUSTICE AND UNSUSTAINABLE IN LAW. 3 ITA NO. 6117/DEL/2018 9. THAT THE IMPUGNED ASSESSMENT ORDER IS ARBITRARY, I LLEGAL, BAD IN LAW IN VIOLATION OF RUDIMENTARY PRINCIPAL OF CONTEMPORARY JURISPRUDENCE. THAT THE PROVISIONS OF SECTION 271(1) (C) IS NOT APPLICABLE IN THE CASE OF THE APPLICANT. 10. THAT THE IMPUGNED ASSESSMENT ORDER PASSED BY LD. A SSESSING OFFICER, NOIDA IS A CLEAR CUT CASE OF MISUNDERSTANDING AND W RONG INTERPRETATION OF LAW 4. THE ASSESSEE IS A FARMER. THE ASSESSEE FILED E- RETURN ON 22/3/2016 DECLARING TOTAL INCOME AT NIL AND SHOWING AGRICULTU RAL INCOME OF RS.20,93,870/-. THE CASE WAS SELECTED FOR LIMITED SCRUTINY THROUGH CASS AS PER NOTICE UNDER SECTION 143(2) OF THE INCOME TAX A CT, 1961 DATED 02.08.2016 IN RESPECT OF AGRICULTURAL INCOME. THE ASSESSING O FFICER MADE AN ADDITION OF RS.10,80,000/- IN RESPECT OF CASH DEPOSITS. 5. BEING AGGRIEVED BY THE ASSESSMENT ORDER, THE ASS ESSEE FILED APPEAL BEFORE THE CIT(A). THE CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE. 6. THE LD. AR SUBMITTED THAT THIS IS A CASE OF LIMI TED SCRUTINY IN RESPECT OF AGRICULTURAL INCOME AND THUS THE ADDITION IN RESPEC T OF CASH DEPOSIT IS NOT JUST AND PROPER. THEREFORE, THE ASSESSMENT ITSELF IS VO ID AB INITIO. THE LD. AR SUBMITTED THE NOTICE UNDER SECTION 143(2) OF THE AC T WHEREIN IT IS MENTIONED THAT IT IS FOR LIMITED SCRUTINY IN RESPECT OF AGRIC ULTURAL INCOME. THE LD. AR ALSO RELIED UPON THE INSTRUCTION NO.20/2015 AND INSTRUCT ION NO. 7 OF 2014 ISSUED BY THE CBDT. THE LD. AR ALSO SUBMITTED THE RTI REPL Y DATED 26.09.2019 FROM THE REVENUE WHEREIN IT IS STATED THAT IT WAS LIMITE D SCRUTINY CASE AND THE ISSUE IS RELATED TO LARGE AGRICULTURAL INCOME. 7. THE LD. DR OBJECTED THE ADDITIONAL GROUND AND SU BMITTED THAT THIS IS NOT A LIMITED SCRUTINY BUT A REGULAR SCRUTINY AND ASSES SING OFFICER RIGHTLY MADE ADDITION OF CASH DEPOSIT. 4 ITA NO. 6117/DEL/2018 8. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. IT IS PERTINENT TO NOTE THAT THE ASSESSING OFFICER HAS CATEGORICALLY POINTED OUT THAT THE CASE IS SELECTED FOR SCRUTINY ON THE BASIS OF LARGE AGRICULTURAL INCOME. BUT AS REGARDS TO CASH DEPOSIT S, THERE IS NO SCRUTINY BY THE ASSESSING OFFICER WHICH CAN BE SEEN FROM THE NO TICE U/S 143(2) DATED 2/8/2016. BUT THE ADDITION WAS MADE ON THE BASIS OF CASH DEPOSITS. IN-FACT, THE RTI REPLY DATED 26/9/2019 ALSO STATED THAT THIS ASPECT OF CASH DEPOSITS WAS NOT AT ALL IN THE SCRUTINY PROCESS. AS PER INS TRUCTION NO. 7/2014 ISSUED BY THE CBDT, IN LIMITED SCRUTINY CASES, IF THE ASSESSI NG OFFICER HAS TO CONDUCT COMPREHENSIVE SCRUTINY, THEN THE ASSESSING OFFICER HAS TO TAKE APPROVAL OF THE PR. CIT/DIT CONCERNED AND SUCH AN APPROVAL SHALL BE ACCORDED BY THE PR. CIT/DIT IN WRITING AFTER BEING SATISFIED ABOUT MERI TS OF THE ISSUE(S) NECESSITATING WIDER AND DETAILED SCRUTINY IN THE CA SE. CASES SO TAKEN UP FOR DETAILED SCRUTINY SHALL BE MONITORED BY THE JT. CIT /ADDL. CIT CONCERNED. THEREFORE, THE ASSESSING OFFICER ACTED BEYOND THE S COPE OF THE SCRUTINY WITHOUT THE PRIOR APPROVAL FROM THE PROPER AUTHORITIES WHIC H IS NOT AT ALL PERMISSIBLE UNDER THE INCOME TAX ACT. THUS, THE ASSESSMENT ORDE R ITSELF BECOMES BAD IN LAW AND VOID-AB-INITIO. THE ADDITIONAL GROUNDS OF A PPEAL OF THE ASSESSEE ARE ALLOWED. THEREFORE, THERE IS NO NECESSITY TO ADJUDI CATE THE OTHER GROUNDS. THE APPEAL OF THE ASSESSEE IS ALLOWED. 8. IN RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 11TH MARC H, 2020. SD/- SD/- (PRASHANT MAHARISHI) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 11/03/2020 R. NAHEED 5 ITA NO. 6117/DEL/2018 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI DATE OF DICTATION DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS 1 1 . 0 3 . 2 0 2 0 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 1 1 . 0 3 . 2 0 2 0 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 1 1 . 0 3 . 2 0 2 0 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