Sh. Sukhjinder Singh, Bathinda V. The Income tax Officer, Bathinda

ITA 678/ASR/2013

• Counselvise Citation: 67820914 RSA 2013
• Duration Of Justice: 4 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-03-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 26-03-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 21-11-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: P N ARORA
• Keywords: Principle of natural justice
• Section: 145

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.S. SIDHU, JUDICIAL MEMBER AND SH. B.P.JAIN, ACCOUNTANT MEMBER I.T.A. NO.678(ASR)/2013 ASSESSMENT YEAR:2009-10 PAN :BTCPS3190K SH.SUKHJINDER SINGH, VS. INCOME TAX OFFICER, H/NO.22636, STREET NO.11, WARD-1(3), BATHINDA. BHAGU ROAD, BATHINDA. (APPELLANT) (RESPONDENT) APPELLANT BY:SH.P.N.ARORA, ADVOCATE RESPONDENT BY:SH. MAHAVIR SINGH, DR DATE OF HEARING: 26/03/2014 DATE OF PRONOUNCEMENT:27/03/2014 ORDER PER BENCH ; THIS APPEAL OF THE ASSESSEE ARISES FROM THE ORDER OF THE CIT(A), BATHINDA, DATED 02.09.2013 FOR THE ASSESSMENT YEAR 2009-10 .THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. THAT THE ASSESSMENT ORDER AS WELL AS THE ORDER OF THE CIT(A), BATHINDA BOTH ARE AGAINST THE FACTS OF THE CASE AND ARE UNTENABLE IN LAW. ITA NO.678(ASR)/2013 2 2. THAT THE AO HAS GROSSLY ERRED IN MAKING AN ADDIT ION OF RS.8,05,034/- BY TAKING THE PEAK OF BANK ACCOUNTS W ITHOUT CONFRONTING THE ASSESSEE. SIMILARLY, THE LD. CIT(A) HAS GROSSLY ERRED IN CONFIRMING THE SAME. 3, THAT THE ITO HAS GROSSLY ERRED IN MAKING AN ADDI TION OF RS.8,05,034/- WHICH IS NOT CALLED FOR AND ADDITION HAS BEEN MADE WITHOUT ANY REASONS AND BASIS. THE LD. CIT(A) HAS GROSSLY ERRED CONFIRMING THE SAME AND AS SUCH ADDITION MAY BE DELETED. 4. THAT THE AO HAS MISERABLY FAILED TO APPRECIATE THAT THE BOOKS OF ACCOUNTS ARE DULY MAINTAINED BY THE ASSESSEE AND CA SH WAS DULY AVAILABLE WITH THE ASSESSEE. SIMILARLY, THE CIT(A) HAS HAS GROSSLY ERRED IN CONFIRMING THE SAME. 5. THAT THE AO HAS GROSSLY ERRED INVOKING THE PROVISIO NS OF SEC. 145 OF THE ACT WITHOUT REJECTING THE BOOKS OF ACCOUNTS OF THE ASSESSEE. AGAIN THE CIT(A) HAS GROSSLY ERRED IN CONFIRMING T HE SAME AND AS SUCH THE ADDITION MADE MAY BE DELETED. 6. THAT AGAIN THE CIT(A) HAS GROSSLY ERRED IN NOT APPR ECIATING THE FACT THAT THE AO HAS GATHERED THE INFORMATION AT THE BAC K OF THE ASSESSEE WITHOUT CONFRONTING THE ASSESSEE AND AGAIN USED THE SAME AGAINST THE ASSESSEE WHICH IS NOT PERMISSIBLE UNDER THE LAW. THAT THE AO HAS FAILED TO APPRECIATE THAT NO ADDITION CA N BE MADE ON THE BASIS OF INFORMATION COLLECTED AT THE BACK OF THE A SSESSEE WITHOUT AFFORDING REASONABLE AND PROPER OPPORTUNITY OF BEI NG HEARD TO THE ASSESSEE. SIMILARLY, THE LD. CIT(A) HAS GROSSLY ER RED IN CONFIRMING THE SAME WITHOUT APPLYING HIS MIND AND WITHOUT APP RECIATING THE FACTS OF THE CASE. AS SUCH, THE ADDITION MAY BE DEL ETED. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E FILED HIS RETURN OF INCOME RELATING TO A.Y. 2009-10 ON 31.07.2009 DECLA RING INCOME OF RS.1,08,680/-. IT WAS STATED BY THE ASSESSEE DURING ASSESSMENT PROCEEDINGS THAT HE DERIVED INCOME FROM COMMISSION ON THE PURCH ASE AND SALE OF OLD CARS. NOTICE U/S 143(2) WAS ISSUED ON 23.08.2011 FI XING THE HEARING FOR ITA NO.678(ASR)/2013 3 9.9.2010. THE CASE WAS AGAIN FIXED FOR 12.05.2011 W HEN THE ASSESSEE ALONGWITH HIS COUNSEL APPEARED AND ON THEIR REQUEST , THE CASE WAS ADJOURNED TO 23.5.2011 REQUIRING THE ASSESSEE TO FURNISH CER TAIN INFORMATION. THEREAFTER, ANOTHER NOTICE DATED 17.8.2011 WAS ISS UED FIXING THE HEARING FOR 6.9.2011. FROM THE PERUSAL OF CASH BOOK, IT WAS NOT ICED BY THE AO THAT THE ASSESSEE HAD MADE CERTAIN TRANSACTIONS OF SUBSTANTI AL AMOUNTS WITH THE NARRATION ADVANCE FROM CUSTOMER BUT THE NAME AND ADDRESS OF THE CUSTOMERS WAS NOT MENTIONED. ACCORDINGLY, THE ASSES SEE WAS REQUIRED TO FURNISH NAME AND COMPLETE ADDRESS OF ALL THE PERSON S FROM WHOM ADVANCES WERE RECEIVED AND THE TOTAL NUMBER OF VEHICLES ON W HICH COMMISSION WAS RECEIVED. THE ASSESSEE WAS REQUIRED TO FURNISH THI S INFORMATION ON 10.10.2011. HOWEVER, ON THE SAID DATE, THE ASSESSE E SOUGHT ADJOURNMENT FOR 18.10.2011. IT WAS MADE CLEAR TO THE ASSESSEE ON 19 .10.2011 THAT ON THE NEXT DATE OF HEARING, COMPLETE BOOKS OF ACCOUNT AND THE INFORMATION ALREADY CALLED FOR MAY BE FURNISHED FAILING WHICH THE ASSES SMENT WOULD BE COMPLETED ON MERITS OF THE CASE. ON 21.11.2011, THE ASSESSEE AND HIS COUNSEL ATTENDED THE OFFICE AND REQUESTED THAT THE CASE MAY BE TAKEN UP ON 22.11.2011. ON 22.11.2011, THE ASSESSEE AGAIN SOUGH T ADJOURNMENT AND THE CASE WAS ADJOURNED TO 25.11.2011. ON 25.11.2011 THE ASSESSEE SUPPLIED COPIES OF LEDGER WHICH CONTAINED NAME AND ADDRESSES OF CUSTOMERS. IN ORDER ITA NO.678(ASR)/2013 4 TO ASCERTAIN THE GENUINENESS OF THE ADVANCES RECEIV ED, THE AO SENT LETTERS TO THE ALLEGED CUSTOMERS REQUIRING THEM TO FURNISH DET AILS OF THE ADVANCES GIVEN BY THEM TO THE ASSESSEE ALONGWITH ITS SOURCE AS ALS O THE DESCRIPTION OF THE VEHICLES PURCHASED. THE ASSESSEE HAS DEPOSITED RS.2 0,85,100/- & RS.11,52,299/- TOTALING RS.32,37,399/- IN CASH IN H IS SAVING BANK ACCOUNT MAINTAINED WITH ICICI BANK AND AXIS BANK RESPECTIVE LY. IT WAS NOTICED BY THE AO THAT THE ASSESSEE HAD SHOWN RECEIPT OF ADVAN CE AT RS.1,00,000/- AND RS.55,000/- ON 2.5.2009 AND 4.6.2008 FROM ONE SHRI NARESH KUMAR WHEREAS IN HIS REPLY, THE SAID SH. NARESH KUMAR INTIMATED T HAT HE HAD MADE ADVANCE OF RS.1,35,000/- ONLY ON 19.12.2008. IN VIEW OF THE ENTIRETY OF FACTS AND CIRCUMSTANCES OF THE CASE, IT WAS HELD BY THE AO T HAT THE BOOKS OF ACCOUNT WERE NOT RELIABLE FROM WHERE TRUE PROFITS COULD BE DEDUCED. IN THE INTEREST OF JUSTICE, THE AO WORKED OUT THE PEAK AMOUNT IN ICICI BANK , AND AXIS BANK, BATHINDA AT RS.5,20,761/- AND RS.2,84,273/- RESPECT IVELY. IN THIS WAY, THE TOTAL PEAK AMOUNT WORKED OUT AT RS.8,05,034/- AND T HE SAME WAS HELD TO BE ASSESSEES UNDISCLOSED INCOME FOR THE A.Y. 2009-10. 3. BEFORE THE LD. CIT(A), THE ASSESSEE MADE THE SUB MISSIONS, WHICH WERE FORWARDED TO THE A.O. AND REMAND REPORT TAKEN. THE LD. CIT(A) AFTER CONSIDERING THE REMAND REPORT AND SUBMISSIONS OF T HE ASSESSEE CONFIRMED THE ACTION OF THE A.O. ITA NO.678(ASR)/2013 5 4. THE LD. COUNSEL FOR THE ASSESSEE, MR. P.N.ARORA, ADVOCATE, ARGUED THAT WHILE CALCULATING THE PEAK AMOUNT, THE AO HAS NEVER CONFRONTED THE ASSESSEE. ALSO, THE ENQUIRY HAS BEEN MADE BY THE A. O. AFTER THE LAST DATE OF HEARING I.E. 25.11.2011 TILL THE DATE OF ORDER I.E. 08.12.2011 WITHOUT CONFRONTING THE ENQUIRY SO MADE. THE AO HAS VIOLATE D THE PRINCIPLE OF NATURAL JUSTICE IN VIEW OF THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF KISHINCHAND CHELLA RAM VS. CIT REPORTED IN (198 0) 125 ITR 713 (SC). 5. THE LD. DR, ON THE OTHER HAND RELIED UPON THE OR DERS OF BOTH THE AUTHORITIES BELOW. 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. THERE IS NO DISPUTE TO THE FACT THAT THE ENQUIRY HA S BEEN MADE BETWEEN 25.11.2011 TO 08.12.2011 AND THE ENQUIRY HAS NOT BE EN CONFRONTED TO THE ASSESSEE. ALSO, PRIMA FACIE THE AO HAS NOT TAKEN IN TO CONSIDERATION THE OPENING CREDIT BALANCE, RETURNED INCOME AND THE PER SONAL LOAN OF RS.2,55,135/- FROM ICICI BANK WHILE COMPUTING PEA K AMOUNT. THEREFORE, FOR THESE CIRCUMSTANCES AND IN THE INTEREST OF JUST ICE, THE MATTER IS SET ASIDE TO THE FILE OF THE A.O. WHO WILL THE DECIDE THE ISSUE AFRESH AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE PLACED BEFORE US AND A NY OTHER SUBMISSION OR MATERIAL TO BE PRODUCED BY THE ASSESSEE SHOULD BE T AKEN ON RECORD AND SHOULD BE CONSIDERED WHILE DECIDING THE ISSUE AFRES H. ACCORDINGLY, THE ITA NO.678(ASR)/2013 6 WHOLE ISSUE IS SET ASIDE TO THE FILE OF THE A.O. WI TH THE DIRECTION TO DECIDE THE SAME AFRESH BUT BY AFFORDING AN OPPORTUNITY OF BEIN G HEARD TO THE ASSESSEE. THUS, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STA TISTICAL PURPOSES. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IN ITA NO.678(ASR)/2013 IS ALLOWED FOR STATISTICAL PURPOSE S. ORDER PRONOUNCED IN THE OPEN COURT ON 27TH MARCH, 2014. SD/- SD/- (H.S. SIDHU) (B.P. JAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 27TH MARCH, 2014 /SKR/ COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE:SH. SUKHJINDER SINGH, BATHINDA. 2. THE ITO WARD 1(3), BATHINDA. 3. THE CIT(A), BATHINDA 4. THE CIT, BATHINDA. 5. THE SR DR, ITAT, AMRITSAR. TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR