Smt. Sushma Nahar, Indore V. ITO-1(3), Indore

ITA 703/Ind/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 0985 (ITAT-INDORE)
• Duration Of Justice: 11 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-06-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 11-06-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R P MOURYA
• Keywords: Search and seizure; Loose papers; Opportunity of cross examination; Tax effect; Documents seized
• Section: 143(3); 153C; 147

Judgement Text

SMC SUSHMA NAHAR ITA NO.703 OF 2019 1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE SMC BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER ITA NO.703/IND/2019 A.Y. 2010-11 SMT. SUSHMA NAHAR, INDORE PAN AASPN3080F :: APPELLANT VS ITO-1(3), INDORE :: RESPONDENT ASSESSEE BY SHRI HIRESH JAIN , CA RESPONDENT BY SHRI R.P. MOURYA , SR. DR DATE OF HEARING 03 . 0 3 .20 20 DATE OF PRONOUNCEMENT 03 .0 6 .20 20 O R D E R THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER OF LD. CIT(A)-I, INDORE DATED 17.04.2019 PERTAINING TO AS SESSMENT YEAR 2010-11. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: GROUNDS OF INCOME TAX APPEAL BEFORE THE HONOURABLE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE AGAINST TH E ORDER U/S 143(3)/147/250 PASSED BY THE LEARNED COMMISSIONER O F INCOME TAX (APPEALS)-1, INDORE FOR ASSESSMENT YEAR 2010-11 1. ADDITION OF RS. 8,88,000/- ON ACCOUNT OF ON MONEY P AID IS UNJUSTIFIED THAT THE CONFIRMATION OF ADDITION OF RS. 8,88,000/- ON ACCOUNT OF ON MONEY ALLEGEDLY PAID BY THE APPELLANT FOR PURCHA SE OF PLOT AT GOLF GREEN IS ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE UNJUSTIFIED, IMPROPER, ARBITRARY, ERRONEOUS AND BAD IN LAW. (TAX EFFECT RS. 223863/-) 2. PRESUMPTION CAN BE RAISED U/S 132(4A) AGAINST PERSO N WHOSE PREMISES ARE SEARCHED AND NOT AGAINST OTHER PERSON. THAT PRESUMPTION UNDER SECTION 132(4A) OF THE ACT C AN BE RAISED ONLY AGAINST THE PERSON WHOSE PREMISES WERE SEARCHE D AND THE SMC SUSHMA NAHAR ITA NO.703 OF 2019 2 DOCUMENTS SEIZED. SINCE THE DOCUMENTS WERE FOUND FR OM GARHA GROUP, THEREFORE, NO PRESUMPTION COULD BE RAISED AG AINST THE APPELLANT. (TAX EFFECT RS. 223863/-) 3. EVIDENTIARY VALUE OF LOOSE SHEETS IS DOUBTFUL. THAT DOCUMENTS SHOWING RECEIPT OF ON MONEY RECOVERE D FROM GARHA GROUP WERE NOT IN FORM OF ACCOUNT BOOKS MAINT AINED IN REGULAR COURSE OF BUSINESS. THEY WERE RANDOM SHEETS AND LOOSE PAPERS AND THEIR CORRECTNESS AND AUTHENTICITY WAS U N-RELIABLE HAVING NO EVIDENTIARY VALUE. THERE HAS TO BE SOME R ELEVANT AND ADMISSIBLE EVIDENCE AND SOME COGENT REASON, WHICH I S PRIMA FACIE RELIABLE AND THAT TOO, SUPPORTED BY SOME OTHE R CIRCUMSTANCES POINTING OUT THAT PARTICULAR THIRD PE RSON AGAINST WHOM ALLEGATIONS HAS BEEN LEVELED IS IN FACT INVOLV ED IN MATTER. (TAX EFFECT RS. 223863/-) 4. PROVISIONS OF SEC. 153C WERE APPLICABLE WHICH EXCLU DES THE APPLICATION OF SECTIONS 147 AND 148 OF THE ACT. THAT WITHOUT PREJUDICE TO ABOVE, IT IS ARGUED IT IS AN ADMITTED FACT, AS ALSO EVIDENT FROM THE REASONS RECORDED AND THE ASSESSMENT ORDER THAT THE INITIATION OF REOPENING P ROCEEDINGS WAS MADE BY THE ASSESSING OFFICER ON THE BASIS OF I NFORMATION RECEIVED FROM THE DIRECTORATE OF INCOME-TAX (INV.) ON THE BASIS OF SEARCH AND SEIZURE OPERATION CONDUCTED AT THE PREMI SES OF GARHA GROUP. THUS, PROVISIONS OF SEC. 153C OF THE ACT WER E APPLICABLE IN THE PRESENT CASE, WHICH EXCLUDES THE APPLICATION OF SEC. 147 OF THE ACT. HENCE, NOTICE ISSUED UNDER SEC. 148 AND AS SESSMENT FRAMED IN FURTHERANCE. THERETO UNDER SEC. 147 READ WITH SECTION 143(3) ARE VOID AB INITIO AND LIABLE TO BE QUASHED. (TAX EFFECT RS. 223863/-) 5. ADDITION TO INCOME WITHOUT CROSS EXAMINATION IS UNJ USTIFIED. THAT NO ADDITION SHOULD BE MADE BASED ON DOCUMENTS FOUND FROM THIRD PARTIES WITHOUT CONFRONTING MATERIAL AND ALLO WING OPPORTUNITY OF CROSS EXAMINATION TO ASSESSEE. THE A PPELLANT SPECIFICALLY REQUESTED THE LEARNED AO FOR CROSS EXA MINATION OF GARHA GROUP PERSONS BUT CROSS EXAMINATION WAS NOT A LLOWED. SINCE THE ASSESSEE HAS NOT BEEN PROVIDED, NECESSARY MATERIAL INCLUDING THEIR STATEMENTS, OPPORTUNITY OF CROSS EX AMINATION AND HEARING BASED THEREON, ADDITION TO INCOME IS THUS U NJUSTIFIED AND IMPROPER. (TAX EFFECT RS. 223863/-) 6. ANY OTHER GROUND MAY BE PERMITTED TO BE TAKEN LATER THAT THE APPELLANT FURTHER CRAVES LEAVE TO ADD, TO ALTER AND/OR TO AMEND ANY OF THE FOREGOING GROUNDS OF APPEAL AS AND WHEN NECESSARY. (NO TAX EFFECT) SMC SUSHMA NAHAR ITA NO.703 OF 2019 3 2. AT THE OUTSET OF HEARING, LD. COUNSEL FOR THE AS SESSEE SUBMITTED THAT NO ADDITION SHOULD HAVE BEEN MADE BA SED ON DOCUMENTS FOUND FROM THIRD PARTIES WITHOUT CONFRONT ING MATERIAL AND ALLOWING OPPORTUNITY OF CROSS EXAMINATION TO AS SESSEE. THE ASSESSEE SPECIFICALLY REQUESTED THE AO FOR CROSS EX AMINATION OF GARHA GROUP PERSONS BUT CROSS EXAMINATION WAS NOT A LLOWED. SINCE THE ASSESSEE HAS NOT BEEN PROVIDED, NECESSARY MATERIAL INCLUDING THEIR STATEMENTS, OPPORTUNITY OF CROSS EX AMINATION AND HEARING BASED THEREON, ADDITION TO INCOME IS THUS U NJUSTIFIED AND IMPROPER. 3. ON THE OTHER HAND, LD. SR. DR RELIED UPON THE OR DERS OF THE REVENUE AUTHORITIES BUT COULD NOT CONTROVERT THE SU BMISSION MADE BY THE LD. COUNSEL FOR THE ASSESSEE BY BRINGIN G ANY CONTRARY MATERIAL ON RECORDS. 4. I HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIALS AVAILABLE ON RECORDS. I FIND THAT THE AO MADE THE A DDITION BASED ON DOCUMENTS FOUND FROM THIRD PARTIES. IN SPITE OF SPECIFIC REQUEST MADE BY THE ASSESSEE THE AO DID NOT ALLOW T HE ASSESSEE TO CONFRONT THE MATERIAL AND OPPORTUNITY OF CROSS E XAMINATION TO ASSESSEE. THEREFORE, I AM OF THE VIEW THAT SINCE TH E ASSESSEE HAS NOT BEEN PROVIDED NECESSARY MATERIAL AND OPPORTUNIT Y OF CROSS SMC SUSHMA NAHAR ITA NO.703 OF 2019 4 EXAMINATION, IT WOULD BE IN THE INTEREST OF JUSTICE IF THE MATTER IS RECONSIDERED BY THE AO AFTER ALLOWING CONFRONTATION OF THE MATERIAL AND CROSS EXAMINATION OF THE THIRD PARTY T O THE ASSESSEE. THEREAFTER, THE AO WOULD FRAME ASSESSMENT AFRESH. N EEDLESS TO MENTION HERE THAT THE DUE OPPORTUNITY SHALL BE PROV IDED TO THE ASSESSEE AND THE ASSESSEE IS ALSO AT LIBERTY TO FIL E EVIDENCE IF ANY IN SUPPORT OF THE CLAIM. 5. IN RESULT, APPEAL FILED BY THE ASSESSEE IS ALLOW ED FOR THE STATISTICAL PURPOSES. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 03.06.20 20. SD/- (KUL BHARAT) JUDICIAL MEMBER DATED : 03 .06.2020 PATEL/PS COPY TO: APPELLANT/RESPONDENT/PR.CIT(A)/PR.CIT/DR, INDORE