M.S.Dinakaran, CHENNAI V. Acit, Tambaram

ITA 730/CHNY/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 4809 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 1 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-06-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 20-06-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 14-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P B SEKARAN
• Assessee Lawyers: V SANKAR
• Keywords: Opportunity of being heard
• Section: 44AD; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AN D SHRI GEORGE MATHAN, JUDICIAL MEMBER .. I.T.A. NO. 730/MDS/2010 ASSESSMENT YEAR : 2005-06 SHRI M.S. DINAKARAN, 9, LAKSHMI AVENUE, IAF STATION ROAD, SELAIYUR, CHENNAI-600 073.. V. THE ASSISTANT COMMISSIONER OF INCOME-TAX, TAMBARAM RANGE, CHENNAI. (PAN: AEVPD9251K) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI V. SANKAR RESPONDENT BY : SHRI P.B. SEKARAN O R D E R PER GEORGE MATHAN, JUDICIAL MEMBER : THIS IS AN APPEAL FILED BY THEASSESSEE AGAINST THE ORDER OF THE LEARNED CIT(APPEALS)-IX, CHENNAI IN ITA NO. 209/08-09 DATED 15-02-2010 FOR THE ASSESSMENT YEAR 2005-06. 2. SHRI V. SHANKAR, CA REPRESENTED ON BEHALF OF THE ASSESSEE AND SHRI P.B. SEKARAN, LEARNED CIT-DR REPRESENTED ON BEHALF OF TH E REVENUE. 3. IT WAS SUBMITTED BY THE LEARNED AUTHORISED REPRE SENTATIVE THAT THE ASSESSEE IS A CIVIL CONTRACTOR, WHOSE TURNOVER WAS OF ` . 32,82,320/-. IT WAS THE SUBMISSION I.T.A. NO.730/MDS/2010 2 THAT THE ASSESSEE HAS BEEN FILING HIS RETURN OF INC OME BY DECLARING 8% OF HIS TURNOVER UNDER THE PROVISIONS OF SECTION 44AD OF TH E INCOME-TAX ACT, 1961. IT WAS THE SUBMISSION THAT THE REVENUE HAD RECEIVED I NFORMATION THAT THE ASSESSEE HAD DEPOSITED ` 26,64,950/- IN CASH ON VARIOUS DATES IN THE ASSESS EES BANK ACCOUNT IN UTI BANK LTD. AT MADIPAKKAM BRANCH. IT WAS THE SUBMISSION THAT THE ASSESSING OFFICER HAD TREATED THE TOTAL CASH DEPOSI T AS THE ASSESSEES INCOME. IT WAS THE SUBMISSION THAT ON APPEAL BEFORE THE LEARNE D CIT(A) THE LEARNED CIT(A) HAD DIRECTED THE ASSESSING OFFICER TO GRANT THE ASS ESSEE OPPORTUNITY TO EXPLAIN THE DEPOSITS IN THE BANK ACCOUNT. IT WAS THE SUBMI SSION THAT THE ASSESSEE HAD BEEN UNABLE TO APPEAR BEFORE THE ASSESSING OFFICER WHEN THE OPPORTUNITY WAS GRANTED. CONSEQUENTLY, THE ASSESSING OFFICER HAD R EPORTED THE SAME TO THE LEARNED CIT(A) AND THE LEARNED CIT(A) HAD DISMISSED THE ASSESSEES APPEAL ON THE GROUND THAT THE ASSESSEE WAS NOT SERIOUS IN PRO SECUTING HIS APPEAL. 4. THE LEARNED AUTHORISED REPRESENTATIVE FILED BEFO RE US A COPY OF THE BANK ACCOUNT WHICH IS THE BASIS OF THE ADDITION. IT WAS THE SUBMISSION THAT THIS WAS THE BUSINESS ACCOUNT OF THE ASSESSEE AND THE DEPOSI T OF ` 26,64,950/- WHICH WAS TREATED AS THE INCOME OF THE ASSESSEE BY THE LEARNE D ASSESSING OFFICER WAS IN FACT VARIOUS DEPOSITS AND NOT A SINGLE DEPOSIT. IT WAS THE SUBMISSION THAT THE LARGEST CASH DEPOSIT WAS AN AMOUNT OF ` 2,50,000/- ON 15-05-2004. IT WAS THE SUBMISSION THAT THESE WERE AMOUNTS RECEIVED DURING THE COURSE OF THE ASSESSEES BUSINESS AND THE WITHDRAWALS WERE MADE FOR VARIOUS PURCHASES AND EXPENSES I.T.A. NO.730/MDS/2010 3 INCURRED FOR THE BUSINESS OF THE ASSESSEE. IT WAS THE SUBMISSION THAT THE ADDITION AS MADE BY THE ASSESSING OFFICER AND AS CONFIRMED B Y THE LEARNED CIT(A) MAY BE DELETED. 5. IN REPLY, THE LEARNED DR VEHEMENTLY SUPPORTED TH E ORDERS OF THE ASSESSING OFFICER AND THE LEARNED CIT(A). 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PER USAL OF THE ASSESSMENT ORDER CLEARLY SHOWS THAT THE ASSESSING OFFICER HAD ISSUED NOTICE U/S 148 OF THE ACT ON THE ASSESSEE ON 22.01.2008. CONSEQUENTLY, THE A SSESSEES CASE WAS POSTED FOR HEARING ON 18.06.2008 AND AGAIN ON 05-11-2008. IT IS NOTICED THAT AFTER 20.11.2008 NO FURTHER POSTING HAS BEEN DONE AND THE ASSESSMENT ORDER HAS BEEN PASSED ON 08-12-2008. A PERUSAL OF THE ORDER OF TH E LEARNED CIT(A) SHOWS THAT THE LEARNED CIT(A) HAD DIRECTED THE ASSESSING OFFIC ER TO GRANT THE ASSESSEE PROPER OPPORTUNITY OF BEING HEARD AND SUBMIT HIS RE PORT. IT IS NOTICED THAT THE NOTICE POSTING THE CASE FOR HEARING BY THE ASSESSIN G OFFICER WAS ON 23.12.2009. IT IS NOTICED THAT NO FURTHER OPPORTUNITY HAS BEEN GRANTED TO THE ASSESSEE. A PERUSAL OF THE BANK ACCOUNT OF THE ASSESSEE SHOWS T HAT THE TOTAL OF THE CASH DEPOSITS ON VARIOUS DATES IS TOTALING TO RS26,64,95 0/-.. THE PEAK OF THE DEPOSITS IS ` 2,50,000/-. THIS AMOUNT IS ALSO DISCLOSED IN THE RECEIPTS & PAYMENT ACCOUNT AS FILED BY THE ASSESSEE FOR THE YEAR ENDED 43.0-3. 2005. AFTER CONSIDERING THIS AMOUNT THE ASSESSEE HAS DISCLOSED A TOTAL INCOME OF ` , 3,00,380/- IN THE RETURN FILED BY THE ASSESSEE ON 28.03.2007. THE RECEIPTS & PAYMENT ACCOUNT FOR THE I.T.A. NO.730/MDS/2010 4 YEAR ENDED 31.03.2005 WHERE THE CASH DEPOSITS OF ` . 26,64,950/- IS SHOWN AS ANNEXURE-2 OF THE RETURN OF INCOME FILED. OBVIOUSL Y, THIS AMOUNT CANNOT BE TREATED AS UNEXPLAINED DEPOSIT OF THE ASSESSEE. FY URTHER THIS AMOUNT HAS ALSO BEEN CONSIDERED BY THE ASSESSEE WHILE COMPUTING HIS TOTAL INCOME U/S 44AD OF THE ACT. IN THE CIRCUMSTANCES, WE ARE OF THE VIEW THAT NO ADDITION ON THIS COUNT IS CALLED FOR IN THE HANDS OF THE ASSESSEE. IN THE CI RCUMSTANCES, THE ADDITION AS MADE BY THE ASSESSING OFFICER AND AS CONFIRMED BY T HE LEARNED CIT(A) STANDS DELETED. IN THE CIRCUMSTANCES, THE APPEAL OF THE A SSESSEE IS ALLOWED. 7. THE ORDER WAS PRONOUNCED IN THE COURT ON 24/06/2 011. SD/- SD/- (ABRAHAM P. GEORGE) (GEORGE MATHAN) ACCOUNTANT MEMBER JUDICIAL MEMBER CHENNAI, DATED THE 24 TH JUNE, 2011. H. COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE