Bharat Dinkar Jadhav, V. Income-tax Officer,

ITA 619/PUN/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 1689 (ITAT-PUNE)
• Duration Of Justice: 2 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-06-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 14-06-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 06-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIL CHAWARE
• Keywords: Search and seizure; Opportunity of being heard; Principle of natural justice; Non compliance; Revised return
• Section: 147; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, PUNE . . , BEFORE SHRI R.K. PANDA, AM . / ITA NO.619/PN/2016 / ASSESSMENT YEAR : 2006-07 MR. BHARAT DINKAR JADHAV, GANGAPUR ROAD, NASHIK 422 010 PAN NO. AECPJ5780L . / APPELLANT V/S ITO, CENTRAL - 1, NASHIK . / RESPONDENT / ASSESSEE BY : SHRI PRAMOD SHINGTE / REVENUE BY : SHRI ANIL CHAWARE / ORDER PER R.K.PANDA, AM : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 20-01-2016 OF THE CIT(A)-13, PUNE RELATING TO ASSE SSMENT YEAR 2006-07. 2. THERE IS A DELAY OF 11 DAYS IN FILING OF THIS APPEAL FOR WHICH THE ASSESSEE HAS FILED AN APPLICATION ALONG WITH AN AFFIDAVIT FOR CONDONATION OF DELAY. CONSIDERING THE CONTENTS OF SUCH CO NDONATION PETITION AND THE AFFIDAVIT FILED BY THE ASSESSEE EXPLAINING THE REASONS FOR DELAY AND AFTER HEARING THE LD. DEPARTMENTAL REPRESEN TATIVE, THE DELAY IN FILING OF THIS APPEAL BY THE ASSESSEE IS CONDONED AND THE APPEAL IS ADMITTED FOR ADJUDICATION. / DATE OF HEARING :14.06.2016 / DATE OF PRONOUNCEMENT:15.06.2016 2 ITA NO.619/PN/2016 3. GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER : 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW , THE LEARNED ASSESSING OFFICER HAS ERRED IN ISSUING NOTICE ' U/S 147 OF THE INCOME TAX ACT, 1961 ESPECIALLY IN VIEW OF THE FACT THAT PROCEEDINGS WERE INITIATED AS A RESULT OF SEARCH ACTION U/S 132 OF THE INCOME TAX ACT, 1961 ON SHRI ANANT KESHAV RAJEGAVKAR AND THE CORRECT PROCEEDINGS OUGHT TO HAVE BEEN INITIATED U/S 153C OF THE INCOME TAX ACT, 1961 . IN VIEW OF THIS YOUR APPELLANT PRAYS THAT THE PROCEEDIN GS INITIATED U/S 147 OF THE INCOME TAX ACT, 1 961 ARE BAD IN LAW AND THEREFORE NEEDS TO BE QUASHED AND ENTIRE ORDER NEEDS TO BE CANCELLED . 2. ON THE FACTS IN THE CIRCUMSTANCE IN THE CASE AND IN THE LAW THE LOWER AUTHORITIES HAVE ERRED IN MAKING THE ADDITION OF RS . 2 , 30,000/- ON ACCOUNT OF UNEXPLAINED SOURCE BY DISREGARDING THE EXP LANATION OFFERED IN THIS REGARD. 3. ON THE FACTS IN THE CIRCUMSTANCE IN THE CASE AND IN THE LAW THE LOWER AUTHOR I TIES HAVE ERRED IN MAKING AN ADDITION OF RS . 42,926/ - BEING LOAN ADVANCE BALANCE BY DISREGARDING APPELLANT S CONTENTION IN THIS REGARD. 4. THE APPELLANT CRAVES FOR TO LEAVE, ADD, ALTER, MO DIFY, DELETE ABOVE GROUND OF APPEAL BEFORE OR AT THE TIME HEARING, IN THE INTEREST OF NATURAL JUSTICE. 4. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSEE IS AN INDIVIDUAL. HE FILED HIS RETURN OF INCOME ON 26-10-2006 SHOW ING TOTAL INCOME OF RS.93,380/-. A SEARCH AND SEIZURE ACTION U /S.132 OF THE I.T. ACT WAS CARRIED OUT IN SUYOJIT GROUP OF CASES. DURING THE COURSE OF SEARCH ON 17-09-2010 AT THE RESIDENTIAL PREMIS ES OF SHRI ANANT KESHAV RAJEGAONKAR, MEMBER OF THE SUYOJIT GROUP, AT SHUBHAM, MODEL COLONY, COLLEGE ROAD, NASHIK CERTAIN DOCUMEN TS WERE SEIZED AS PER ANNEXURE A/8. ANALYSIS OF THE ABOVE DOCUMENTS INDICATED PAYMENT OF RS.2.30 LAKHS ON 18-07-2005 WHICH WAS NOT EXPLAINED BY THE ASSESSEE DURING THE COURSE OF SEARCH PROCEEDINGS/POST SEARCH PROCEEDINGS. THE SEIZED DOCUME NT INDICATED NOTINGS REGARDING LOANS AND ADVANCES, REPAYMENT RECEIVED AND CALCULATION OF INTEREST. FOR THE YEAR UNDER CONSIDER ATION THE AMOUNT OF SUCH LOAN WAS RS.2,30,000/- AND INTEREST THEREO N WAS RS.42,926/-. ACCORDINGLY, THE CASE OF THE ASSESSEE WAS R EOPENED. 3 ITA NO.619/PN/2016 HOWEVER, THE ASSESSEE HAS NOT FILED ANY REVISED RETURN. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO ASKED THE ASS ESSEE TO SUBSTANTIATE HIS SAYING ON THE NOTINGS FOUND DURING THE COURSE OF SEARCH IN THE CASE OF SHRI ANANT KESHAV RAJEGAONKAR. H OWEVER, THERE WAS NO COMPLIANCE FROM THE ASSESSEES SIDE FOR WH ICH THE AO COMPLETED THE ASSESSMENT U/S.144 OF THE I.T. ACT BY MAK ING ADDITION OF RS.2,72,936/- TO THE TOTAL INCOME OF THE ASSESSEE. 5. IN ABSENCE OF ANY COMPLIANCE FROM THE SIDE OF THE ASSES SEE THE LD.CIT(A) UPHELD THE ADDITION MADE BY THE AO BY PASSING AN ELABORATE ORDER. 6. AGGRIEVED WITH SUCH ORDER OF THE CIT(A) THE ASSESSEE IS IN APPEAL BEFORE ME. 7. THE LD. COUNSEL FOR THE ASSESSEE FILED A PAPER BOOK CON TAINING 41 PAGES AND SUBMITTED THAT NO ADDITION IN THE HANDS OF THE ASSESSEE IS CALLED FOR IN VIEW OF THE ASSESSMENT ORDER PA SSED IN THE CASE OF SHRI ANANT KESHAV RAJEGAONKAR IN A.YRS. 2005-06 AND 2006- 07. REFERRING TO PAGE 10 OF THE PAPER BOOK HE SUBMITTED THAT ELABORATE SUBMISSIONS WERE MADE BEFORE THE CIT(A) VIDE LETT ER DATED 03-11-2014, HOWEVER, THE SAME WERE NOT CONSIDERED BY H IM. HE ACCORDINGLY SUBMITTED THAT THE ENTIRE ADDITION MADE BY T HE AO AND UPHELD BY THE CIT(A) SHOULD BE DELETED. 8. IN HIS ALTERNATE CONTENTION, HE SUBMITTED THAT HE HAS NO OBJECTION IF THE MATTER IS RESTORED TO THE FILE OF THE AO W ITH A DIRECTION TO GIVE ONE MORE OPPORTUNITY TO THE ASSESSEE TO SUBSTANTIATE HIS CASE. 4 ITA NO.619/PN/2016 9. THE LD. DEPARTMENTAL REPRESENTATIVE ON THE OTHER HA ND WHILE STRONGLY SUPPORTING THE ORDER OF THE CIT(A) SUBMITTED TH AT THE ASSESSEE HAS NEITHER APPEARED BEFORE THE AO NOR APPEA RED BEFORE THE CIT(A), THEREFORE, THE ORDER OF THE CIT(A) BE UPHELD. 10. I HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES, PERUSED THE ORDERS OF THE AO AND THE CIT(A) AND THE PA PER BOOK FILED ON BEHALF OF THE ASSESSEE. I HAVE ALSO CONSIDERED VARIOUS DECISIONS CITED BEFORE ME. IT IS AN ADMITTED FACT THAT DUE TO NON COMPLIANCE BY THE ASSESSEE, THE AO COMPLETED THE ASSESSMENT U/S.1 44 OF THE I.T. ACT BY MAKING ADDITION OF RS.2,72,926/- BEING UNEXPLAINED LOANS AND ADVANCES OF RS.2,30,000/- AND INTEREST THEREON AMOUNTING TO RS.42,926/-. I FIND ALTHOUGH THE ASSESSEE HA D FILED WRITTEN SUBMISSION BEFORE THE CIT(A) ON 03-11-2014, HOWEVE R, THE SAME WAS NOT CONSIDERED BY THE CIT(A) AND HE HAS PASSED AN EXPARTE ORDER UPHOLDING THE ADDITION MADE BY THE AO. TH E ASSESSEE HAS FILED VARIOUS DETAILS BEFORE ME TO SUBSTANTIATE THAT NO ADDITION IS CALLED FOR IN THE INSTANT CASE IN THE HANDS OF THE ASSESSE E. HOWEVER, WITHOUT GOING INTO THE MERIT OF THE ADDITION, I FIND THE ASSE SSEE HAS NOT MADE ANY SUCH SUBMISSION BEFORE THE AO AND WHATEV ER SUBMISSION MADE BEFORE THE CIT(A) HAS NOT BEEN CONSIDERED BY HIM SINCE THOSE SUBMISSIONS WERE FILED BEFORE HIS PREDECESSOR. CONSIDERING THE TOTALITY OF THE FACTS OF THE CASE AND IN T HE INTEREST OF JUSTICE, I DEEM IT PROPER TO RESTORE THE ISSUE TO THE FILE OF THE AO WITH A DIRECTION TO GIVE ONE MORE OPPORTUNITY TO THE ASSESSE E TO SUBSTANTIATE HIS CASE. THE AO SHALL DECIDE THE ISSUE AS P ER FACT AND LAW AFTER GIVING DUE OPPORTUNITY OF BEING HEARD TO THE ASS ESSEE. I HOLD AND DIRECT ACCORDINGLY. GROUNDS RAISED BY THE ASS ESSEE ARE ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES. 5 ITA NO.619/PN/2016 11. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 15-06-2016 /- SD/- ( R.K. PANDA ) ACCOUNTANT MEMBER PUNE ; DATED :15 TH JUNE, 2016. '# $# / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. THE CIT (A) - 13 , PUNE 4. 5. 6. THE CIT-13, PUNE $ ''(, (, SMC BENCH / DR, ITAT, SMC BENCH PUNE; - / GUARD FILE. / BY ORDER , // TRUE COPY // // $ ' //TRUE /0 ' ( / SR. PRIVATE SECRETARY (, / ITAT, PUNE