M/s. Angad Developers Pvt. Ltd., New Delhi V. ITO, New Delhi

ITA 651/DEL/2014

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 3537 (ITAT-DELHI)
• Duration Of Justice: 5 year(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-02-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 13-06-2017
• Assessment Year: 2005-2006
• Appeal Filed On: 05-02-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S L ANURAGI
• Assessee Lawyers: K J S MEHTA
• Keywords: Additional evidence; Reason to believe
• Section: 147; 68; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH SMC, NEW DELHI BEFORE SH. R.K PANDA, ACCOUNTANT MEMBER ITA NO.651/DEL/2014 ASSESSMENT YEAR: 2005-06 ANGAD DEVELOPERS PVT LTD. B-1/4, OPP. LSR COLLEGE ZAMRUDPUR NEW DELHI PAN NO.AADCA8901E VS ITO WARD 1 (4) NEW DELHI (APPELLANT) (RESPONDENT) APPELLANT BY SH. K. J. S. MEHTA, FCA RESPONDENT BY SH. S. L. ANURAGI, SR. DR DATE OF HEARING: 18/02/2019 DATE OF PRONOUNCEMENT: 21 /0 2 /201 9 ORDER PER R.K. PANDA, AM: 1. THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED A GAINST THE ORDER DATED 07.11.2013 OF THE CIT(A)-IV, NEW DELHI RELATING TO A. Y. 2005-06. 2. THE FACTS OF THE CASE, IN BRIEF, ARE THAT THE AS SESEE IS A COMPANY AND IS ENGAGED IN THE BUSINESS OF REAL ESTA TE. THE ORIGINAL RETURN OF INCOME IN THE INSTANT CASE WAS F ILED ON 31.10.2005 DECLARING LOSS OF RS.9,69,924/-. SUBSEQ UENTLY, ON THE BASIS OF INFORMATION RECEIVED FROM THE OFFICE O F THE CIT(CENTRAL)-II, NEW DELHI THAT THE ASSESSEE COMPAN Y WAS ONE OF THE BENEFICIARY WHO HAS TAKEN ACCOMMODATION ENTRY O F RS.10 LACS FROM M/S. STELLAR INVESTMENT LIMITED VIDE PAY ORDER NO.760603 DATED 30.07.2004, THE ASSESSING OFFICER REOPENED TH E ASSESSMENT BY RECORDING REASONS AND ISSUE OF NOTICE U/S 148 OF THE IT ACT. 2 REJECTING THE VARIOUS EXPLANATION GIVEN BY THE ASSE SSEE AND OBSERVING THAT THE ASSESSEE FAILED TO ESTABLISH THE GENUINESS OF THE TRANSACTION, THE ASSESSING OFFICER MADE ADDITIO N OF RS.10 LACS U/S 68 OF THE IT ACT. 3. IN APPEAL THE LD.CIT(A) UPHELD THE ACTION OF THE ASSESSING OFFICER AND REJECTED THE ARGUMENTS OF THE ASSESSEE BOTH ON MERIT AS WELL AS ON LEGAL GROUND CHALLENGING THAT THE NOT ICE ISSUED U/S 148 IS BARRED BY LIMITATION U/S 149 (1) (B) OF THE IT ACT. 4. AGGRIEVED WITH SUCH ORDER OF THE CIT(A), THE ASS ESSEE IS IN APPEAL BEFORE THE TRIBUNAL BY RAISING FOLLOWING GRO UNDS :- 1) THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) HAS ERRED BOTH ON FACTS AND IN LAW IN UPHOLDING THE ACTION OF THE LEA RNED ASSESSING OFFICER IN MAKING AN ADDITION OF RS.10,00,000/- U/S 68 OF THE INCOME TAX ACT, 1961 ALLEGEDLY ON THE GROUND THAT THE GENU INENESS OF THE TRANSACTION COULD NOT BE ESTABLISHED. 2) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE A PPELLANT COMPANY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HA S ERRED BOTH ON FACTS AND IN LAW IN REJECTING THE ADDITIONAL EVIDEN CE FILED IN TERMS OF RULE 46A OF THE INCOME TAX RULES, 1962 AFTER CALLIN G FOR THE REMAND REPORT FROM THE LEARNED ASSESSING OFFICER AND THERE BY NOT FOLLOWING THE DECISION OF THE HON'BLE TRIBUNAL IN THE CASE OF SHAH RUKH KHAN VS. DCIT REPORTED IN 13 SOT 61 (MUM.). 3) THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AMEND T HE GROUND OF APPEAL AT A LATER STAGE. 5. THE ASSESSEE HAS ALSO TAKEN THE FOLLOWING ADDITI ONAL GROUNDS :- 2.1 THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE A PPELLANT COMPANY IT IS AGGRIEVED AS THE AO HAS INCORRECTLY ASSUMED JURISDI CTION U/S 147 OF THE ACT AND THE ORDER PASSED U/S 147/148 IS INVALID IN LAW ON ACCOU NT OF THE FOLLOWING LEGAL ISSUES:- 2.1.1 THAT NECESSARY SATISFACTION ON THE REASONS RECORDE D BY A.O. AS REQUIRED U/S 151(2) HAS NOT BEEN RECORDED BY THE ADDL. CIT, RANG E 1, NEW DELHI AND THEREFORE THE ASSUMPTION OF JURISDICTION U/S 147 IS NOT VALID AND CONSEQUENTLY THE ASSESSMENT IS INVALID. 2.1.2 THAT IN THE ABSENCE OF NOTICE U/S 143(2) READ WITH SECTION 148 BEING ISSUED AND SERVED ON THE APPELLANT COMPANY THE REASSESSMENT PR OCEEDINGS AND CONSEQUENTIAL ASSESSMENT ORDER U/S 147/143(3) IS WITHOUT JURISDIC TION AND UNSUSTAINABLE IN LAW. 3 2.1.3 THAT THE REASONS RECORDED FOR ASSUMING JURISD ICTION U/S 147 ARE VAGUE INCOMPLETE AND HAVE NO NEXUS WITH MATERIAL ON RECOR D THAT INCOME OF THE APPELLANT COMPANY HAS ESCAPED ASSESSMENT AND THEREFORE THERE WAS NO REASON TO BELIEVE FOR THE A.O. TO ASSUME JURISDICTION U/S 147. 6. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT OMISSION OF THE ABOVE GROUNDS WAS DUE TO A CLERICAL MISTAKE IN THE OFFICE AND THEREFORE BE ADMITTED. RELYING ON THE DECISION OF H ONBLE SUPREME COURT IN THE CASE OF NTPC VS. CIT REPORTED 229 ITR 383, JUTE CORPORATION OF INDIA LIMITED REPORTED IN 187 ITR 68 8 AND VARIOUS OTHER DECISIONS HE SUBMITTED THAT THESE GROUNDS BEI NG LEGAL GROUNDS AND NO FRESH FACTS ARE REQUIRED TO BE INVES TIGATED, THEREFORE, THESE GROUNDS SHOULD BE ADMITTED. 7. AFTER HEARING BOTH THE SIDES AND CONSIDERING TH E FACT THAT THE GROUNDS RAISED BY THE ASSESSEE ARE PURELY LEGAL IN NATURE AND NO FRESH FACTS ARE REQUIRED TO BE INVESTIGATED, THE ADDITIONAL GROUNDS RAISED BY THE ASSESSEE ARE ADMITTED. 8. I HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BO TH THE SIDES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. I FIND THE ASSESSING OFFICER IN THE INSTANT CASE HAS REOPENED THE ASSESSMENT US/ 147 / 148 OF THE IT ACT ON THE GROUN D THAT THE ASSESSEE HAS RECEIVED ACCOMMODATION ENTRY OF RS. 10 LACS FROM M/S. STELLAR INVESTMENT LTD. AND ASSESSEE FAILED TO DISCHARGE ITS ONUS REGARDING GENUINESS OF SUCH TRANSACTIONS. I F IND THE LD. CIT(A) WHILE UPHOLDING THE ACTION OF THE ASSESSING OFFICER DID NOT CONSIDER CERTAIN ADDITIONAL EVIDENCES FILED BEFORE HIM. THE ASSESSEE IN THE LEGAL GROUNDS HAS MENTIONED THAT NO NOTICE U/S 143 (2) OF THE IT ACT WAS ISSUED TO THE ASSESSEE AN D THAT THE SATISFACTION BY THE ADDITIONAL CIT(A) WAS GIVEN IN A MECHANICAL MANNER. SINCE THE LD. CIT(A) HAS NOT ACCEPTED THE A DDITIONAL EVIDENCES, THEREFORE, CONSIDERING THE TOTALITY OF T HE FACTS OF THE 4 CASE AND IN THE INTEREST OF JUSTICE I DEEM IT PROPE R TO RESTORE THIS ISSUE TO THE FILE OF THE CIT(A) WITH THE DIRECTION TO ADMIT THE ADDITIONAL EVIDENCES AND DECIDE THE ISSUE AS PER FA CT AND LAW. THE LD. CIT(A) SHALL ALSO DECIDE THE ADDITIONAL GROUNDS RAISED BY THE ASSESSEE WHICH WERE NOT RAISED BEFORE HIM WHILE DEC IDING THE APPEAL IF HE DEEMS IT PROPER. THE GROUNDS RAISED B Y THE ASSESSEE ARE ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSE. 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 21.02.2019. SD/- (R.K PANDA) ACCOUNTANT MEMBER *NEHA* DATE:- 21.02.2019 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI DATE OF DICTATION 18.02.2019 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING 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 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 22.02.2019 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH FILE GOES TO THE HEAD CLERK. THE DATE ON WHICH FILE GOES TO THE ASSISTANT REGIST RAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER