Sh. Kamal Narayan Sharma, Dehradun V. ITO, Dehradun

ITA 6908/DEL/2014

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 4948 (ITAT-DEHRADUN)
• Duration Of Justice: 5 year(s) 9 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-10-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2008-2009
• Appeal Filed On: 23-12-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K CHATTERJEE
• Assessee Lawyers: ROMAL JAIN; RAJAT SHARMA
• Keywords: Unexplained cash credit; Unexplained investment; Document seized; Tax effect; Documents seized
• Section: 271(1)(c); 13; 132; 144

Judgement Text

IN TH E INCOME TAX APPELLATE TRIBUNAL DE HRADUN BENCH : DEHRADUN (THROUGH VIRTUAL COURT HEARING) BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA NO S . 6908/DEL/2014 & 1687/DEL/2015 ASSESSMENT YEAR : 20 08 - 09 CO NO .231/DEL/2015 ASSESSMENT YEAR : 2004 - 05 KAMAL NARAYAN SHARMA, C/O RAJAT, 643, SIRMOUR MARG, RAJENDER NAGAR, KAULAGARH ROAD, DEHRADUN. PAN : ATMPS2827A VS ITO, WARD 2(1), DEHRADUN. ITA NO.512/DEL/2014 ASSESSMENT YEAR: 20 04 - 05 ITO, WARD 2(1), DEHRADUN . VS. KAMAL NARAYAN SHARMA, 53, EC ROAD, DEHRADUN. PAN : A GXPR1459B (APP ELL A NT ) (RESPONDENT) A SSESSEE BY : SHRI RAJAT SHARMA, CA & SHRI ROMAL JAIN, CA RE VENUE BY : SHRI S.K. CHATTERJEE, SR. DR DATE OF HEARING : 0 9 . 10 . 20 20 DATE OF PRONOUNCEMENT : 14 . 10 . 20 20 ITA NO S . 6908 /DEL/201 4, 1687/DEL/2015, & 512/DEL/2014 CO NO.231/DEL/2015 2 ORDER PER R. K. PANDA, AM : ITA NO.6908/DEL/2014 FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 01.10.2014 OF THE CIT(A) - 1, DEHRADUN, RELATING TO ASSESSMENT YEAR 20 0 8 - 09. ITA NO.1687 /DEL/2015 FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 01.10.2014 OF THE CIT(A) - 1, DEHRADUN, CONFIRMING THE PENALTY OF RS.29,25,144/ - LEVIED BY THE AO U/S 271(1)(C) OF THE ACT RELATING TO ASSESSMENT YEAR 20 08 - 09. ITA NO.512/DEL/2014 FILED BY THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 26.11.2013 OF THE CIT(A) - 1, DEHRADUN, RELATING TO ASSESSMENT YEAR 20 04 - 05. THE ASSESSEE HAS FILED CO NO.231/DEL/2015 AGAINST THE APPEAL OF THE REVENUE. FOR THE SAKE OF CONVENIENCE, ALL THESE APPEALS AND CO W ERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS COMMON ORDER. ITA NO.6908/DEL/2014 (BY ASSESSEE) (2008 - 09) 2. ALTHOUGH A NUMBER OF GROUNDS HAVE BEEN RAISED BY THE ASSESSEE, THESE ALL RELATE TO THE ORDER OF THE CIT(A) IN CONFIRMING VARIOUS ADDITIONS M ADE BY THE AO IN THE ORDER PASSED U/S 144 OF THE ACT. 3. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSEE IS AN INDIVIDUAL. A SEARCH U/S 132 OF THE ACT WAS CARRIED OUT IN THE PREMISES OF THE ASSESSEE ON 25 TH FEBRUARY, 2008. VARIOUS NOTICES ISSUED BY T HE AO WERE RETURNED UNSERVED BY THE POSTAL AUTHORITIES WITH THE REMARK THAT THE HOUSE IS LOCKED SINCE LONG TIME BACK. THE ITA NO S . 6908 /DEL/201 4, 1687/DEL/2015, & 512/DEL/2014 CO NO.231/DEL/2015 3 NOTICE GIVEN TO THE NOTICE SERVER OF THE DEPARTMENT WAS ALSO RETURNED BACK WITH THE REMARK THAT THE ABOVE PERSON DOES NOT RESIDE AT THIS ADDRESS FROM LAST ONE YEAR. SUBSEQUENTLY, THE INSPECTOR OF THE OFFICE WAS DEPUTED TO MAKE ENQUIRY IN THE MATTER AND TO SERVE THE SAID NOTICE THROUGH AFFIXTURE. THE NOTICE WAS AF FIXED BY THE INSPECTOR ON 30.11.2009 ON THE GATE WALL OF THE ASSESSEE IN THE PRESENCE OF TWO WITNESSES OF THE DEPARTMENT AND ONE LOCAL MEMBER OF THE AREA RESIDING OPPOSITE SIDE OF THE ASSESSEE S RESIDENCE, BUT, HE REFUSED TO SIGN ON ANY OF THE DOCUMENTS. SUBSEQUENTLY, THERE WAS ALSO NON - COMPLIANCE TO THE NOTICE ISSUED U/S 14 3(2) OF THE ACT. IN VIEW OF THE ABOVE AND ON THE BASIS OF THE VARIOUS SEIZED DOCUMENTS, THE AO COMPLETED THE ASSESSMENT U/S 144 OF THE ACT, DETERMINING THE TOTAL INCOME OF THE ASSESSEE AT RS.87,75,897/ - WHICH INCLUDED UNEXPLAINED CREDIT ENTRIES IN THE BAN K ACCOUNTS OF RS.17,41,894/ - , INTEREST INCOME OF RS.2,415/ - AND VARIOUS OTHER UNEXPLAINED INVESTMENT AND UNEXPLAINED INCOME ON THE BASIS OF VARIOUS SEIZED DOCUMENTS. 4. IN APPEAL, THE LD.CIT(A) GAVE PART RELIEF, BUT, SUSTAINED THE ADDITION OF RS.20 LAKHS ON ACCOUNT OF AMOUNT RECEIVED BY THE ASSESSEE FROM SHRI HAZI EKAN ALI, RS.8,16,588/ - BEING UNEXPLAINED INVESTMENT BY THE ASSESSEE IN CASH AND RS.8 LAKHS ON ACCOUNT OF RECEIPT BY THE ASSESSEE ON 04.04.2008. 5. AGGRIEVED WITH SUCH ORDER OF THE CIT(A), THE A SSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. ITA NO S . 6908 /DEL/201 4, 1687/DEL/2015, & 512/DEL/2014 CO NO.231/DEL/2015 4 6. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE WAS NOT STAYING AT DEHRADUN AND WAS STAYING AT DELHI AND, THEREFORE, COULD NOT PARTICIPATE IN THE ASSESSMENT PROCEEDINGS DUE TO NON - RECEIPT OF THE ST ATUTORY NOTICES. EVEN THE S A ME WERE NEVER BROUGHT TO HIS NOTICE. ONLY AFTER THE DEMAND WAS RAISED THAT HE CAME TO KNOW OF THE SAME AND FILED APPEAL BEFORE THE CIT(A). EVEN THERE ALSO THE VARIOUS OBJECTIONS RAISED BY THE ASSESSEE REGARDING THE NATURE, SO URCE AND UTILIZATION OF THE RECEIPTS WERE NOT PROPERLY APPRECIATED BY THE CIT(A) . HE SUBMITTED THAT IN THE INTEREST OF JUSTICE, THE ASSESSEE SHOULD BE GIVEN ONE FINAL OPPORTUNITY TO SUBSTANTIATE HIS CASE. 7. THE LD. DR, ON THE OTHER HAND, SUBMITTED THAT THE ASSESSEE DID NOT APPEAR BEFORE THE AO FOR WHICH HE MADE THE ADDITION . A LTHOUGH THE ASSESSEE WAS ABLE TO APPEAR BEFORE THE CIT(A) , H OWEVER, HE COULD NOT SUBSTANTIATE THE VARIOUS ENTRIES FOUND IN THE SEIZED DOCUMENTS FOR WHICH THE LD.CIT(A) GAVE ONLY PAR T RELIEF TO THE ASSESSEE AND, THEREFORE, THE ORDER OF THE CIT(A) IS F U L LY JUSTIFIED. HE ACCORDINGLY SUBMITTED THAT THE GROUNDS RAISED BY THE ASSESSEE SHOULD BE DISMISSED. 8 . WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES , PERUSED THE ORDE RS OF THE ASSESSING OFFICER AND CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DECISIONS CITED BEFORE US. WE FIND, THE AO, IN THE INSTANT CASE, COMPLETED THE ASSESSMENT U/S 144 OF THE ACT, DETERMINING THE T OTAL INCOME AT RS.87,75,897/ - . WE FIND, THE LD.CIT(A) GAVE ONLY PART RELIEF TO THE ASSESSEE AND SUSTAINED THE MAJOR ADDITIONS. IT IS THE SUBMISSION OF ITA NO S . 6908 /DEL/201 4, 1687/DEL/2015, & 512/DEL/2014 CO NO.231/DEL/2015 5 THE LD. COUNSEL FOR THE ASSESSEE THAT THE ASSESSEE WAS STAYING AT DELHI AND COULD NOT APPEAR BEFORE THE AO DUE TO NON - RECEIPT OF THE STATUTORY NOTICES WHICH THE AO HAS ALSO MENTIONED IN THE ASSESSMENT ORDER AND THE NOTICE WAS SERVED THROUGH AFFIXTURE. IT IS ALSO HIS SUBMISSION THAT THE LD.CIT(A) HAS NOT APPRECIATED THE FACTS OF THE CASE PROPERLY AND GIVEN A N OPPORTUNITY, THE ASSESSEE IS IN A POSITION TO SUBSTANTIATE HIS CASE EITHER BEFORE THE AO OR BEFORE THE CIT(A). CONSIDERING THE TOTALITY OF THE FACTS OF THE CASE AND IN THE INTEREST OF JUSTICE, WE DEEM IT PROPER TO RESTORE THE ISSUE TO THE FILE OF THE AO WITH A DIRECTION TO GRANT ONE FINAL OPPORTUNITY TO THE ASSESSEE TO SUBSTANTIATE HIS CASE. THE ASSESSEE IS ALSO HEREBY DIRECTED TO APPEAR BEFORE THE AO AND SUBSTANTIATE HIS CASE WITHOUT SEEKING ANY ADJOURNMENT UNDER ANY PRETEXT AND COOPERATE WITH THE AO F OR COMPLETION OF THE ASSESSMENT PROCEEDINGS AT THE EARLIEST FAILING WHICH THE AO IS AT LIBERTY TO PASS APPROPRIATE ORDER AS PER LAW . THE GROUNDS RAISED BY THE ASSESSEE ARE ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES. ITA NO. 1687/DEL/2015 (BY ASSESSEE) ( A.Y.2008 - 09) 9. THE ASSESSEE, IN THE GROUNDS OF APPEAL, CHALLENGED THE ORDER OF THE CIT(A) IN SUSTAINING THE PENALTY LEVIED BY THE AO U/S 271(1)(C) OF THE IT ACT. 10. AFTER HEARING BOTH THE PARTIES THE DELAY IN FILING OF THE APPEAL IS CONDONED. WE FIND , THE AO, IN THE INSTANT CASE, LEVIED PENALTY OF RS.2 9 ,25,144/ - U/S 271(1)(C) WHICH HAS BEEN PARTLY SUSTAINED BY THE CIT(A). AS HELD IN THE PRECEDING PARAS, THE APPEAL FILED BY THE ASSESSEE IN THE QUANTUM PROCEEDINGS HA S BEEN RESTORED TO THE ITA NO S . 6908 /DEL/201 4, 1687/DEL/2015, & 512/DEL/2014 CO NO.231/DEL/2015 6 FILE OF THE AO FOR FRESH ADJUDICATION. SINCE VARIOUS ADDITIONS MADE BY THE AO AND SUSTAINED BY THE CIT(A) WHICH IS THE BASIS OF LEVY OF PENALTY U/S 271(1)(C) HAS BEEN RESTORED TO THE FILE OF THE AO, THEREFORE, THE PENALTY SO SUSTAINED BY THE CIT(A) DOES NOT SURVIVE AT THIS JUNCTURE AND IS DIRECTED TO BE DELETED . HOWEVER, THE AO IS AT LIBERTY TO INITIATE FRESH PENALTY PROCEEDINGS U/S 271(1)(C) AFTER COMPLETION OF THE QUANTUM PROCEEDINGS. THE GROUNDS RAISED BY THE ASSESSEE ARE ACCORDINGLY ALLOWED. ITA NO.512/DEL/2014 (BY THE REVENUE) (A.Y. 2004 - 05) 11. AFTER HEARING BOTH THE PARTIES, WE FIND THE TAX EFFECT IN THE GROUNDS RAISED BY THE REVENUE IS , ADMITTEDLY, BELOW RS.50 LAKHS. THEREFORE, IN VIEW OF THE CBDT CIRCULAR NO.17/2019 DATED 8 TH AUGUST, 2019 RAISING THE MONETARY LIMITS FOR FILING OF THE APPEALS BY THE REVENUE BEFORE THE TRIBUNAL TO RS.50 LAKHS AND THE SUBSEQUENT CLARIFICATION DATED 20 TH AUGUST, 2019 TO THE EFFECT THAT THE SAID CIRCULAR IS APPLICABLE EVEN TO PENDING APPEALS, THE APPEAL FILED BY THE REVENUE IS NOT MAINTAINABLE. ACCORDINGLY, THE SAME IS DISMISSED. CO NO.231/DEL/2015 (BY THE ASSESSEE A.Y.2004 - 05) 12. AFTER HEARING BOTH THE SIDES , WE FIND THE APPEAL FILED BY THE REVENUE HAS BEEN DISMISSED ON ACCOUNT OF LOW TAX EFFECT. THEREFORE, THE CO FILED BY T HE ASSESSEE BECOMES INFRUCTUOUS. ACCORDINGLY, THE SAME IS DISMISSED. ITA NO S . 6908 /DEL/201 4, 1687/DEL/2015, & 512/DEL/2014 CO NO.231/DEL/2015 7 13 . IN THE RESULT, ITA NO.6908/DEL/2014 FILED BY THE ASSESSEE I S ALLOWED FOR STATISTICAL PURPOSES ; ITA NO.1687/DEL/2015 FILED BY THE ASSESSEE IS ALLOWED; AND ITA NO.512/DEL/2014 F ILED BY THE REVENUE & CO NO.231/DEL/2015 FILED BY THE ASSESSEE ARE DISMISSED . THE ORDER PRONOUNCED IN THE OPEN COURT ON 14 . 10 .20 20 . SD/ - SD/ - ( SUDHANSHU SRIVASTAVA ) ( R. K. PANDA ) JUDICIAL MEMBER ACCO UNTANT MEMBER DATED: 14 TH OCTOBER, 2020. DK COPY FORWARDED TO 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASSTT. REGISTRAR, ITAT, NEW DELHI