Sh. Satbir Singh, New Delhi V. Addl. CIT, New Delhi

ITA 683/DEL/2015

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 3141 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-02-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Assessment Year: 2008-2009
• Appeal Filed On: 03-02-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: Y P RAWLA
• Assessee Lawyers: S S RANA
• Keywords: Business income; Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G NEW DLEHI BEFORE SHRI G.D. AGRAWAL, PRESIDENT AND SHRI K. NARASIMHA CHARY, JUDICIAL MEMBER I.T.A. NO.683/DEL/2015 ASSESSMENT YEAR: 2008-09 SHRI SATBIR SINGH, VS ADDL. COMMISSIONER OF INCO ME-TAX 4/73, WEA KRISHNA MARKET, RANGE-33, CIVIC CENTRE, E BLOCK, SARASWATI MARG, KAROL BAGH, NEW DELHI. NEW DELHI. (PAN: AOGPS9991A) (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI S.S. RANA, CIT DR RESPONDENT BY: SHRI Y.P. RAWLA, C A ORDER DATE OF HEARING: 26.02.2018 DATE OF PRONOUNCEMENT: 28.02.2018 PER K. NARASIMHA CHARY, JM AGGRIEVED BY THE ORDER DATED 5.11.2014 IN APPEAL NO. 350/13-14, PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)- XXVIII, NEW DELHI (LD. CIT(A)) ASSESSEE PREFERRED THIS APPEAL EXPRESSING HIS GRIEVANCE THAT NO PROPER OPPORTUNITY WAS GIVEN BY THE AO FOR SUBMISSION OF THE DOCUMENTS IN SUPPORT OF CLAIM OF EXPENSES/INCOME FOR THE DETERMINATION OF T OTAL INCOME AND ALSO THAT THE 2 LEARNED CIT(A) ALSO ERRED IN PASSING ORDER WITHOUT VERIFYING THE DETAILS OF ADDITION AND IN REJECTING THE EVIDENCE IN SUPPORT OF THE EVI DENCE IN RESPECT OF THE BUILDING. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL DERIVING INCOME, DURING THE ASSESSMENT YEAR 2008-09, FROM HOUSE PROP ERTY, BUSINESS INCOME AND SHORT TERM CAPITAL GAIN FROM OTHER SOURCES. FOR SU CH AN ASSESSMENT YEAR, HE HAS FILED RETURN OF INCOME ON 27.3.2009 DECLARING A TOT AL INCOME OF RS.1,01,66,910/. AFTER SCRUTINY, LEARNED AO MADE THREE ADDITIONS, VIZ ., RS,8,61,055/- ON ACCOUNT OF SHORT TERM CAPITAL GAIN, RS.4,99,983/- ON ACCOUNT O F THE RECEIPTS FROM AGRICULTURAL INCOME BUT TREATED AS INCOME FROM UNDISCLOSED SOURC ES AND RS.12,00,000/- ON ACCOUNT OF INCOME FROM OTHER SOURCES. 3. IN THE APPEAL BEFORE THE LEARNED CIT (A), ASSESS EE PRODUCED ADDITIONAL EVIDENCE. WHEN CALLED FOR THE REMAND REPORT, LEARN ED AO STATED THAT THE ORDER SHEET SHOWS THAT AMPLE OPPORTUNITY WAS GIVEN TO THE ASSESSEE TO SUBMIT THE EVIDENCE IN SUPPORT OF HIS CLAIM BUT IN SPITE OF TH E SAME ASSESSEE DID NOT PRODUCE SUCH EVIDENCE AND UNLESS THE ASSESSEE SATISFIES THE CONDITIONS UNDER RULE 46A OF THE INCOME-TAX RULES, 1962, SUCH AN EVIDENCE CANNOT BE ADMITTED. LEARNED CIT(A) IN HIS ORDER OBSERVED THAT THOUGH THE CONFIR MATION WAS PRODUCED BY THE ASSESSEE FROM M/S KALINGA INTERNATIONAL, M/S GOLDEN PAINT AND HARDWARE, M/S SAVIOUR AIRCOM, M/S AD ENTERPRISES, M/S G.D. ENTERP RISES AND M/S RAHUL CORPORATION, SUCH CONFIRMATIONS WERE NOT SUPPORTED BY ANY BILLS, AND ON THAT GROUND HELD THAT THESE DOCUMENTS DO NOT SUPPORT THE CLAIM OF THE EXPENDITURE SOUGHT TO HAVE BEEN INCURRED BY THE ASSESSEE. IN RE SPECT OF THE OTHER ADDITIONS ALSO, LEARNED CIT(A) RECORDED THE FINDING THAT THER E IS NO PROPER EVIDENCE TO JUSTIFY DELETION OF THE ADDITIONS MADE BY THE LEARNED AO. LEARNED CIT(A), THEREFORE, REFUSED TO INTERFERE WITH THE ASSESSMENT ORDER AND DISMISS THE APPEAL. CHALLENGING THE SAME, THE ASSESSEE IS IN THIS APPEA L BEFORE US. 3 4. AT THE OUTSET, IT IS THE SUBMISSION OF THE LEARN ED AR THAT NO PROPER OPPORTUNITY WAS GIVEN TO HIM BY THE AO. ACCORDING TO HIM, WHEN THE AO SOUGHT CLARIFICATION ON SOME POINTS VIDE ORDER SHEET ENTRY DATED 15.12.2010, THE ASSESSEE FILED THE DETAILS AND EXPLANATIONS ALONG W ITH THE LETTER DATED 17.12.2010 BUT WITHOUT HEARING THE ASSESSEE ON ANY OF THESE DET AILS, THE AO PASSED THE ORDER ON 31.12.2010 IGNORING SUCH MATERIAL FURNISHED BY HI M. FURTHER, ACCORDING TO HIM, WHEN THE LEARNED CIT(A) FELT THAT THE CONFIRMA TION LETTERS NEED CORROBORATION BY OTHER EVIDENCES, HE SHOULD HAVE EXE RCISED THE POWERS UNDER THE ACT TO SECURE SUCH EVIDENCES AS IS NECESSARY OR DIRE CTED THE ASSESSEE TO PRODUCE SUCH EVIDENCE AS IS REQUIRED BY HIM, BUT INSTEAD OF DOING SO, PROCEEDED TO DEAL WITH THE MATTER IN THE ABSENCE OF PROPER OPPORTUNIT Y TO PRODUCE EVIDENCE. FOR THESE REASONS, LEARNED AR SUBMITTED THAT THE ORDERS OF THE AUTHORITIES BELOW SUFFER IRREGULARITY AND NEED TO BE QUASHED. 5. PER CONTRA, IT IS THE SUBMISSION OF THE LEARNED DR THAT AS POINTED OUT BY THE LEARNED AO IN HIS REMAND REPORT, AMPLE OPPORTUNITY W AS GRANTED AND THE MATTER WAS ADJOURNED AT LEAST FIVE TIMES, VIZ. 19.10.2010, 2.11.2010, 10.11.2010, 2.12.2010, 15.12.2010 AND 16.12.2010 BUT IN SPITE O F GRANTING THIS MUCH OPPORTUNITY, THE ASSESSEE FAILED TO FILE THE SAME, T HEREFORE, FORCING THE AUTHORITIES TO PROCEED WITH THE MATTER AVAILABLE ON RECORD, AS SUCH, THE ASSESSEE CANNOT CONTEND THAT OPPORTUNITY WAS NOT GRANTED TO HIM. FU RTHER, LEARNED CIT(A) ALSO CONSIDERED THE EVIDENCE PRODUCED BEFORE US AND DEAL T WITH THE MATTER ON MERITS, AS SUCH, THE ASSESSEE CANNOT HAVE ANY GRIEVANCE AGAI NST THE IMPUGNED ORDER. FOR THESE REASONS, HE PRAYED TO DISMISS THE APPEAL. 6. WE HAVE GONE THROUGH THE RECORD IN THE LIGHT OF THE SUBMISSIONS ON EITHER SIDE. ADMITTEDLY, THE REMAND REPORT SHOWS THAT THE LEARNED AO SOUGHT CERTAIN CLARIFICATIONS BY ADJOURNING THE MATTER FIVE TIMES. IT IS THE SUBMISSION OF THE ASSESSEE THAT ULTIMATELY ON 17.12.2010, THE DETAILS WERE FURNISHED ALONG WITH EXPLANATION BY WAY OF LETTER DATED 17.12.2010 AND WIT HOUT CONSIDERING THE SAME, 4 THE ASSESSMENT ORDER CAME TO BE PASSED. EVEN THE RE MAND REPORT AS IS REFERRED TO IN THE IMPUGNED ORDER DOES NOT SHOW THAT THE HEA RING WAS HELD AFTER THE ALLEGED SUBMISSION OF THE DOCUMENTS AND THE DETAILE D EXPLANATION BY WAY OF LETTER DATED 17.12.2010. THE IMPUGNED ORDER ALSO S HOWS THAT THE ASSESSEE PRODUCED THE CONFIRMATION LETTERS FROM M/S KALINGA INTERNATIONAL, M/S GOLDEN PAINT AND HARDWARE, M/S SAVIOUR AIRCOM, M/S AD ENTE RPRISES, M/S G.D. ENTERPRISES AND M/S RAHUL CORPORATION BUT THE LEARN ED CIT(A) FELT THAT THESE LETTERS ARE NOT SUPPORTED BY ANY BILLS. IT IS THE SU BMISSION OF THE LEARNED AR THAT THE AUTHORITIES BELOW COULD HAVE EXERCISED THEIR PO WERS UNDER THE ACT TO VERIFY THE CORRECTNESS OR OTHERWISE OF THESE CONFIRMATION LETTERS FURNISHED BY THE VENDORS AND THEY COULD HAVE GATHERED THE RELEVANT MA TERIAL REQUIRED BY THEM OR THE LEARNED CIT(A) SHOULD HAVE DIRECTED THE ASSESSE E TO PRODUCE THE ADDITIONAL MATERIAL REQUIRED BY THE LEARNED CIT(A). 7. HAVING REGARD TO THESE FACTS AND CIRCUMSTANCES, WE ARE OF THE CONSIDERED OPINION THAT IT IS A MATTER OF RECORD THAT THE ASSE SSEE WAS GRANTED FIVE ADJOURNMENTS FOR PRODUCING THE EVIDENCE BEFORE PASS ING THE ASSESSMENT ORDER, BUT THE ENTIRE EXERCISE TOOK PLACE WITHIN A SPAN OF LESS THAN TWO MONTHS. THERE IS NO DENIAL OF THE FACT THAT THE ASSESSEE PRODUCED TH E DOCUMENTS ALONG WITH THE EXPLANATION ON 17.12.2010 SUBSEQUENT TO WHICH NO HE ARING TOOK PLACE BEFORE THE LEARNED AO. RECORD PROBABLIZES THE SUBMISSION ON B EHALF OF THE ASSESSEE THAT HAD SOME OPPORTUNITY BE GIVEN TO THE ASSESSEE, THE A SSESSEE COULD HAVE PUT FORTH HIS CASE IN AN EFFECTIVE MANNER. SINCE THE ENTIRE EXERCISE OF ASSESSMENT PROCEEDINGS IS WITH THE PURPOSE OF REACHING THE JUS T TAX LIABILITY OF THE ASSESSEE, WE ARE OF THE CONSIDERED OPINION THAT THE ENDS OF J USTICE WOULD BE MET BY PERMITTING THE ASSESSEE TO PRODUCE ALL THE EVIDENCE AT HIS COMMAND BEFORE THE AO IN SUPPORT OF HIS CLAIM. IN THE ABSENCE OF ANY P LEA TO THE EFFECT THAT THE RIGHTS OF THE PARTIES ARE CRYSTALLIZED BY AFFLUX OF TIME, OU R ENTIRE ENDEAVOR IS TO SEE THAT THE TAX LIABILITY OF THE ASSESSEE IS DETERMINED ACCO RDING TO LAW. WITH THIS VIEW OF 5 THE MATTER, WE ARE INCLINED TO SET ASIDE THE MATTER TO THE FILE OF THE AO FOR CONSIDERING THE SAME AFRESH IN THE LIGHT OF THE EVI DENCE TO BE PRODUCED BY THE ASSESSEE IN SUPPORT OF HIS CLAIM. LEARNED AO WILL GIVE SUCH AN OPPORTUNITY TO THE ASSESSEE BEFORE PASSING THE FRESH ORDERS. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS THE 28 TH DAY OF FEBRUARY, 2018. SD/- SD/- (G.D. AGRAWAL) (K. NARASIMHA CHARY) PRESIDENT JUDICIAL MEMBER DATED: 28 TH FEBRUARY, 2018 VJ COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT BY ORDER ASSTT. REGISTRAR, ITAT