Shri Teja Ram Jakhar, Merta City V. DCIT,Circle, Nagaur

ITA 69/JODH/2023

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 4098 (ITAT-JODHPUR)
• Duration Of Justice: 10 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-01-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 30-01-2024
• Assessment Year: 2016-2017
• Appeal Filed On: 05-03-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Salary income; Opportunity of being heard; Principle of natural justice; Additional evidence; Cost of acquisition; Reasonable cause; Non compliance; Set aside
• Section: 147; 148; 154; 143(3); 54F; 142(1); 143(2); 69A; 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH, JODHPUR. BEFORE: DR. S. SEETHALAKSHMI, JJUDICIAL MEMBER & SHRI RATHOD KAMLESH JAYANTBHAI, ACCOUNTANT MEMBER ITA Nos. 68, 69 & 71/Jodh/2023 Assessment Year: 2014-15, 2016-17 & 2017-18 Tej Ram Jakhar S/o Sh. Umeda Ram Jakhar A- 23, Subhash Nagar, Civil Lines, Merta City, Nagaur [PAN: AAUPJ 4001 A] (Appellant) Vs. DCIT, Circle Nagaur (Respondent) ITA No. 70/Jodh/2023 Assessment Year: 2017-18 Tej Ram Jakhar S/o Sh. Umeda Ram Jakhar A- 23, Subhash Nagar, Civil Lines, Merta City, Nagaur [PAN: AAUPJ 4001 A] (Appellant) Vs. ITO, Ward-01, Nagaur (Respondent) Appellant by Sh. Amit Kothari, CA Respondent by Ms. Nidhi Nair, Sr. DR Date of Hearing 31.01.2024 Date of Pronouncement 31.01.2024 ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM I.T.A. Nos. 68 to 71/Jodh/2023 Assessment Year: 2014-15, 2016-17 & 2017-18 2 These four appeals filed by assessee is arising out of the order of the National Faceless Appeal Centre, Delhi dated 17/02/2023, 25/01/2023 & 19.01.2023 [here in after ‘NFAC’ ] for assessment years 2014-15, 2016-17 & 2017-18 which in turn arise from the order dated 06.12.2019, 07.12.2019 ,14.07.2021 & 10.12.2019 passed under section 143(3) r.w.s 147, under section 143(3) & under section 154 of the Income Tax Act, by DCIT/ACIT, Circle-01, Nagaur. 2. Since the issues involved in these appeals are almost identical on facts and are almost common, except the difference in figure disputed in each year, therefore, these appeals were heard together with the agreement of both the parties and are being disposed off by this consolidated order. 3. At the outset, the ld. AR has submitted that the matter in ITA No. 68/Jodh/2023 may be taken as a lead case for discussions as the issues involved in the lead case are common and inextricably interlinked or in fact interwovenand the facts and circumstances of other cases are identical except the difference in the amount indispute other cases. The ld. DR did not raise any specific objection against taking that case as a lead case. Therefore, for the purpose of the present discussions, the I.T.A. Nos. 68 to 71/Jodh/2023 Assessment Year: 2014-15, 2016-17 & 2017-18 3 case of ITA No. 68/Jodh/2023 is taken as a lead case. Based on the above arguments we have also seen that for these appeals grounds are similar, facts are similar, and arguments were similar and therefore, were heard together and are disposed by taking lead case facts, grounds, and arguments from the folder inITA No. 68/Jodh/2023. 4. Before moving towards the facts of the case we would like to mention that the assessee has assailed the appeal in ITA No. 68/Jodh/2023 on the following grounds; “1.The Id. CIT(A) has erred in upholding the order passed by Id. AO u/s 143(3) r.w.s 147. The order so made is bad in law and bad on facts and is contrary to the principles of natural justice. The initiation of proceedings u/s 148 is bad in law and bad on facts. 2.The Id. CIT (A) has erred in not accepting additional evidences presented in pursuant to Rule 46A, the assessment being made without appreciating facts of the case is bad in law and bad on facts. The rejection of additional evidence and also considering the same while discussing the additions on merits is contradictory finding of CIT(A). 3.The ld. CIT(A) has erred in upholding addition of Rs. 29,20,028/- made by ld AO. by treating agriculture income as unexplained income without appreciating the facts. The addition so made is bad in law and bad on facts and without providing assessee opportunity of being heard. 4. The appellant craves liberty to add, alter, amend or vary from the above the above grounds of appeal at or before the time of hearing.” 5. Succinctly, the fact as culled out from the records is thatin this case, the return of income for A.Y 2014-15 was e-filed by the assessee on 31.03.2015 at an income of Rs. 17,83,920/- vide acknowledgement no. 559815500310315. The case was subsequently reopened for I.T.A. Nos. 68 to 71/Jodh/2023 Assessment Year: 2014-15, 2016-17 & 2017-18 4 scrutiny after getting approval from the office of Joint Commissioner of Income Tax, Range- Nagaur and notice u/s 148 was issued by the Income Tax Officer, Ward-03, Nagaur to the assessee on 28.03.2019, which was duly served on the assessee through ITBA portal.In response to notice u/s 148 assessee was e-filed his return of income for AY 2014- 15 on 26.04.2019 vide acknowledgement no. 467859450260419 at an income of Rs. 15,10,450/-. Accordingly Notice u/s 143(2) of the Act was issued on 04.12.2019 and reasons for notice u/s 148 of the Act was provided to the assessee on 19.08.2019. 5.1 On perusal of the record the assessee earned income from salary, Income from House Property, Income from Business & Profession, Income from Capital Gain and Income from other sources during the year under consideration.In this case information was available that Late Smt. Sita W/o Sh. Teja Ram Jakhar died on 26.10.2013. During the course of assessment in the deceased assessee, statementof Shri Teja Ram Jakhar (Legal Heir) was recorded on 02.11.2018. Sh. Teja Ram Jakharstated that after death of his wife, he had filed her returns of income for the A.Ys. 2014-15,2015-16 and 2016 - 17 through e-filling and after signing the ITR-V by him, the same wassubmitted to the CPC through post. It is clearly established that the ITRs were filed by thelegal I.T.A. Nos. 68 to 71/Jodh/2023 Assessment Year: 2014-15, 2016-17 & 2017-18 5 heir of the assessee after the death of the assessee. In such a situation, as per Law,the assessee should have clubbed the income of his wife with him as a dead person cannotearn any income which is actually enjoyed by the legal heir. So legal heir should haveincluded the same in this income and filed ITR accordingly but in this case the assessee hasfailed to do so and has a filed a separate ITR for his wife who was deceased by then.Shri Teja Ram Jakhar, in the statement during the assessment proceedings of Late Smt. Sita had admitted to bear all responsibility in respect of tax/penalty/prosecution, if any arose in his deceased wife's case. Considering the fact of the case the case was taken up for scrutiny u/s 147 of the I.T. Act, 1961. 5.2 On perusal of ITR of Late Smt. Sita it was noticed that the income of the assessee after the death i.e. from 26.10.2013 to 31.03.2014 should be clubbed by the legal heir in his ITR. As per ITR filed on 28.03.2015, in the name of Smt. Sita, net taxable income of Rs 2,05,740/- and agricultural income Rs. 3,98,150/- total 6,03,890/- was declared for A.Y. 2014- 15. It is pertinent to mentioned here that during the period under consideration, Smt. Sita was alive for 209 days. Therefore, the income related to remaining period ie. 156 days is to be considered in case of the assessee. The proportionate income in this I.T.A. Nos. 68 to 71/Jodh/2023 Assessment Year: 2014-15, 2016-17 & 2017-18 6 regard is Rs. 87,933/- Further in the return of Late Smt. Sita agriculture income was shown of Rs. 3,98,150/- so the proportionate income for year under consideration is Rs. 1,70,168/- which should have been shown as agriculture income of the assessee.On perusal of the ITR original filed by the assessee it was noticed that the assessee has shown agriculture income of 25,21,878/- the ITR for A.Y. 2014-15 filed on 31-03-2015, declared a taxable income of Rs. 17,83,920/- vide acknowledgment no. 559815500310315 In response to the notice u/s 148 the assessee filed his return of income on 26-04-2019 declaring total income of Rs. 15,10,450/- and agriculture income of Rs. 29,20,028/- which includes the clubbed income of wife late Smt. Sita of Rs. 37,965/- and agriculture income of Rs. 3,78,150/- of late Smt. Sita. The assessee vide notice u/s 142(1) dated 19.08.2019 was requested to furnish detail relating to business income of late Smt. Sita and agriculture income shown by assessee. But it is clear from the above timeline that the assessee is non- compliant and not furnishing any documents by the assessee.The assessee has failed to furnish supporting documents relating to agriculture income. The assessee did not filed ownership document, Girdawari, Mandi Bills, Mode of receipt of income and other relevant document. So no verification could be done in this case so the same Rs. 29,20,028/- is held as Unexplained income I.T.A. Nos. 68 to 71/Jodh/2023 Assessment Year: 2014-15, 2016-17 & 2017-18 7 under section 69A of the act read with section 115BBE of the assessee and is added to the income of the assessee Further the income disclosed in the return of assessee which has partly clubbed income of assessee of Rs 87,933/-, no source of the same is furnished by the assessee for the same so it is held to be undisclosed /unexplained receipt and would be taxed in accordance with 115BBE of the Act. 5.3 The ld. AO also noted that when the case was reopening u/s 147/148 of the Income Tax Act, 1961, the assessee did not disclosed the income from other sources of Rs. 49968/-in hands of Smt. Sita and no detail has been furnished in this regard. So the same is treated as undisclosed income of the assessee and taxed as per provision of 115BBE of the Act.Further it was noticed that the assessee has claimed deduction under section 54F in the return under section 148 while in the original return no such claim was there. So the assessee was requested to submit the document related to purchase of residential house or construction of the same during the year under consideration vide notice u/s 142(1) dated 21/9 / 2019 As discussed above no compliance was made to the statutory notices by the assessee so the claim of 54F amounting to Rs. 252039/- is disallowed and added back to the income of the assesse. Further the assessee in the onginal return has shown I.T.A. Nos. 68 to 71/Jodh/2023 Assessment Year: 2014-15, 2016-17 & 2017-18 8 cost of acquisition of Rs. 28571 /- while in the return filed u/s 148 of the Act, the same is shown as 87961/-. Considering the fact that no submission made by the assessee the cost of acquisition as taken as the one filed under original return i.e. 28571/- and the claim of 54F is disallowed so long term capital gain is computed as 311429/- and added to the income of theassessee.Since the assessee was remained non- compliant and has not submitted the details required by AO and therefore, the assessment was completed based on the available information with the ld. Assessing Officer. 6. Aggrieved from the order of Assessing Officer, the assessee preferred an appeal before the ld. CIT(A). Apropos to the grounds so raised the relevant finding of the ld. CIT(A) is reiterated here in below:- “During the appellate proceedings, merely taking a plea that his previous counsel has not responded can't be considered a reason for non- compliance specifically in a situation where the AO had issued 13 notice/show cause notices but the appellant either sought adjournment or did not comply these notices/show cause notice. Also, a confirmation from the previous counsel is not furnished in support of the claim that the previous counsel didn't uploaded the information. Further, it is stated that he is unable to get the confirmation from the previous counsel due to dispute is also not reliable because the appellant didn't furnish even the nature of dispute with supporting documents and also even disclosing the name & complete address of the counsel. This argument is nothing but an afterthought theory. Also, the appellant has argued that it's case falls under sub- rule (1) clause (b) & (c) of Rule 46A but didn't demonstrate how his case is covered under these sub-rule. Both Sub-rule says that the appellant should be prevented by sufficient cause from producing the evidences but the appellant has failed to demonstrate the sufficient cause. In the present case, the AO issued several notices calling I.T.A. Nos. 68 to 71/Jodh/2023 Assessment Year: 2014-15, 2016-17 & 2017-18 9 specific evidences/information but he failed to submit these evidences and he is shifting the entire onus of non-compliance on his previous counsel without substantiating his argument with any documentary evidence Further, the appellant has filed only some of the documents sought by the AO during the assessment proceedings and no complete documents/information sought by the AO has been furnished during the appellate proceedings. Therefore, merely furnishing only part documents/information will not be sufficient to fulfill the requirement of the AO. So far as the decision in cited case law is concerned, the facts of the cited case law are different from the facts of the present case, hence, not applicable. In the cited case law of ONS Creations (P) Ltd, the court held that if there was a reasonable cause for non-producing of evidence before AO whereas in the present case, the AO had granted several opportunities of being heard but the Appellant didn't comply these notices by producing evidences/information. Keeping in view that the AO has provided more than sufficient opportunity of being heard, this case doesn't fall under any exceptions of rule 46A of the IT Rule. Thus, the additional evidences are not admitted u/s 46A of the I. T. Rule, 1962 on merit. Thus, the present appeal is primarily dismissed.” 7. Aggrieved from the above order of the ld. CIT(A), the assessee preferred the present appeal on the ground as stated hereinabove. Apropos to the grounds so raised, the ld. AR of the assessee submitted that looking to the fact of the case that the assessment is made in the case on account of the fact that income wife after her death partly to be assessee in her name and partly in his name for the year under consideration as well as for the subsequent year. On account of the death of wife of the assessee he could not produce the certain details as it was not found properly at the time of proceeding before the lower authority. Even the status of mind of the assessee was under tremor. This resulted the non compliance before the ld. AO but at thefirst I.T.A. Nos. 68 to 71/Jodh/2023 Assessment Year: 2014-15, 2016-17 & 2017-18 10 appealstage before the ld. CIT(A) the assessee filed the additional evidence and prayed that the same be considered in light of the facts stated herein above. He further based on these facts submitted that the ld. CIT(A) should have considered the applications under rule 46A as the assessee being a village man, not technically equipped and unaware of such notice uploaded on the portal for which no intimation was received through mail or SMS skipped to check the portal and by time she assessed her e-portal she left heavenly abode. The assessment was completed. Therefore, considering the peculiar and facts of the case and in the interest of the justice, these evidence are required to be tested on its merits in order to bring the correct fact on record and in order to charge the correct tax on the income of the assessee. 8. Per contra, the ld. DR relied upon the orders of the lower authorities particularly of the ld. CIT(A) which is passed on merit also but at the same time fairly admitted that the bench may take an appropriate decision in the interest of justice. 9. We have heard the rival contentions and perused the material placed on record. The bench noted that the appeal of the assessee dismissed without affording the opportunity of being heard to the I.T.A. Nos. 68 to 71/Jodh/2023 Assessment Year: 2014-15, 2016-17 & 2017-18 11 assessee. The bench also noted that wife of the assessee expired and the assessee was passing through thetremor. Therefore could not submit the required documents before the ld. AO, moreover looking to the fact of the case that the assessment is made in these year on account of the fact that income wife after her death partly to be assessee in her name and partly in his name for the year under consideration as well as for the subsequent year. On account of the death of wife of the assessee he could not produce the details as it was not found properly at the time of proceeding before the lower authority. Even the status of mind of the assessee was under tremor. This resulted the non compliance before the ld. AO but at the first appeal stage before the ld. CIT(A) the assessee filed the additional evidence and prayed that the same be considered in light of the facts stated herein above. He further based on these facts submitted that the ld. CIT(A) should have considered the applications under rule 46A as the assessee being a village man, not technically equipped and unaware of such notice uploaded on the portal for which no intimation was received through mail or SMS skipped to check the portal and by time she assessed her e-portal she left heavenly abode. The assessment was completed. Therefore, considering the peculiar and facts of the case and in the interest of the justice, we admit this evidence. Since, these additional evidence is also required to be tested on its I.T.A. Nos. 68 to 71/Jodh/2023 Assessment Year: 2014-15, 2016-17 & 2017-18 12 merits in order to bring the correct fact on record and in order to charge the correct tax on the income of the assessee. As the ld. AR prayed that these facts are not examined by the ld. CIT(A) and if given a chance the assessee would like to plead these contentions before the ld. CIT(A) and based on these arguments he prayed to set aside the issue to the file of the ld. CIT(A). On the other hand, we found that the ld. DR raise any general objection but there is no specific objection as to why the prayer of the assessee should not be accepted based on the factual aspect of the matter. These facts is not disputed by the revenue. Therefore, we are of the considered view that the assessee is deprived of justice. We also take note of the fact that the ld. AR of the assessee relied upon the judgement of the Hon’ble Delhi High Court in the case of CIT vs. Virgin Securities and Credits (P) Ltd. (2011) reported at 332 ITR 396 (Del) wherein the court held that CIT(A) should admit the additional evidence if he finds that the same is crucial for disposal of the appeal of the assessee. Here we note that the additional evidence filed by the assessee is required to be seen to verify the nature of the income and under whose name it is to be taxed ergo we admit the additional evidence and set a side the matter to the file of the ld. AO to decide the issue based on the additional evidence and pass the order in accordance with the law. I.T.A. Nos. 68 to 71/Jodh/2023 Assessment Year: 2014-15, 2016-17 & 2017-18 13 10. Before parting, we may make it clear that our decision to restore the matter back to the file of the ld. AO shall in no way be construed as having any reflection or expression on the merits of the dispute, which shall be adjudicated by the ld. AO independently in accordance with law. In terms of these observations, the appeal of the assessee in ITA no. 68/Jodh/2023 is allowed for statistical purposes. 11. The fact of the case in ITA Nos. 69 to 71-Jodh-2023 is similar to the case in ITA No. 68-Jodh-2023 and we have heard both the parties and persuaded the materials available on record. The bench has noticed that the issues raised by the assessee in this appeal No. 69 to 71/Jodh/2023 is equally similar on set of facts and grounds. Therefore, it is not imperative to repeat the facts and various grounds raised by both the parties. Hence, the bench feels that the decision taken by us in ITA No. 68/Jodh/2023 for the Assessment Year 2014-15shall apply mutatis mutandis in the case of Shri Teja Ram Jakhar in ITA Nos. 69 to 71-Jodh- 2023 for the Assessment Year 2016-17 & 2017-18. I.T.A. Nos. 68 to 71/Jodh/2023 Assessment Year: 2014-15, 2016-17 & 2017-18 14 In the result, fourappeals of the assessee are allowed for statistical purposes. Order pronounced in the open court on 31.01.2024 Sd/- Sd/- (Dr. S. Seethalakshmi) (Rathod Kamlesh Jayantbhai) Judicial Member Accountant Member Ganesh Kumar, PS (On Tour) Copy of the order forwarded to: (1)The Appellant (2) The Respondent (3) The CIT (4) The CIT (Appeals) (5) The DR, I.T.A.T. True Copy By order Date Initial 1. Draft dictated on Sr.PS/PS 2. Draft placed before author Sr.PS/PS 3. Draft proposed & placed before the Second Member JM/AM 4. Draft discussed/approved by Second Member JM/AM 5. Approved Draft comes to the Sr. P.S./P.S. Sr.PS/PS 6. Kept for pronouncement on Sr.PS/PS 7. File sent to the Bench Clerk Sr.PS/PS 8. Date on which file goes to the Head Clerk 9. Date on which file goes to the AR 10. Date of dispatch of Order I.T.A. Nos. 68 to 71/Jodh/2023 Assessment Year: 2014-15, 2016-17 & 2017-18 15