ITO, Jaipur V. LATE SH GYARSI LAL SHARMA L/H GHANSIRAM, Jaipur

ITA 753/JPR/2010

• Counselvise Citation: 75323114 RSA 2010
• Duration Of Justice: 1 year(s) 6 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-12-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 19-12-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 15-06-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Additional evidence; Reasonable cause
• Section: 144

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, A JAIPUR (BEFORE SHRI R.K.GUPTA AND SHRI N.L. KALRA) ITA NO.753/JP/2010 ASSESSMENT YEAR : 2006-2007 INCOME TAX OFFICER VS. LATE SHRI GYARSI LAL S HARMA, WARD-7(2), THROUGH LEGAL HEIRS JAIPUR. SHRI GHASIRAM, HARI NARAIN BADRI NARAYAN, KALASH CHAND & BANSI LAL SONS, AJMER ROAD, SANGANER, JAIPUR. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SUNIL MATHUR RESPONDENT BY : NONE (A.D. ON RECORD) DATE OF HEARING: 19.12.2011 DATE OF PRONOUNCEMENT: 22.12.2011 ORDER PER SHRI N.L. KALRA, A.M. 1. THE REVENUE HAS FILED AN APPEAL AGAINST ORDER OF LD. CIT (A) JAIPUR DATED 31.3.2010. THE GROUND OF APPEAL IS AS UNDER: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE T HE LD. CIT (A) HAS ERRED IN IN ACCEPTING THE ADDITIONAL EVIDENCES UNDER RULE 46A, FURNISHED BY THE ASSESSEE DESPITE THE OBJECTION MADE BY THE A.O. THAT THE ASS ESSEE HAD NOT MADE COMPLIANCES TO THE STATUTORY NOTICES ISSUED BY REGI STERED POST WHICH ARE VALID SERVICE IN VIEW OF DECISION OF HONBLE DELHI HIGH C OURT IN THE CASE OF CIT V/S SHANKAR LAL VED PRAKASH 212 CTR 47 (DEL.) AND IN TR EATING UNEXPLAINED DEPOSIT OF RS.2,17,99,630/-. 2. NOTICE U/S 142 (1)(I) WAS ISSUED VIDE WHICH THE ASSESSEE WAS ASKED TO FILE THE RETURN OF INCOME BY 18.12.2006. NOTICE WAS SENT BY REGISTERED POST BUT NO REPLY WAS RECEIVED. ON DIFFERENT DATES NOTICES WERE ISSUED 6 TIMES BUT THE RE WAS NO RESPONSE FROM THE ASSESSEE. THE 2 A.O. WAS LEFT WITH NO ALTERNATIVE BUT TO COMPLETE T HE ASSESSMENT U/S 144 OF I.T. ACT. THERE WERE DEPOSITS IN THE BANK ACCOUNT NO.5179 OPERATED BY AS SESSEE AS UNDER: 19.01.2006 1,04,15,315/- 16.03.2006 1,69,000/- 16.03.2006 1,12,15,315/- TOTAL 2,17,99,630/- 3. IN ABSENCE OF ANY DETAILS, THE A.O. ASSESSED THE INCOME OF RS.2,18,49,630/-. 4. LEGAL HEIRS FILED APPEAL BEFORE LD. CIT (A). IT WAS SUBMITTED BEFORE THE LD. CIT (A) THAT ASSESSEE EXPIRED ON 21.8.2007 AND HE WAS AN LLITERA TE FARMER. THE ASSESSEE SOLD AGRICULTURAL LAND ON 17.1.2006 AND THE LAND WAS SITUATED BEYOND 8 KMS . BEFORE THE LD. CIT (A), THE LEGAL HEIRS FILED THE FOLLOWING DOCUMENTS AND REQUESTED FOR ADM ISSION OF SUCH EVIDENCES: (A) COPIES OF SALES REGISTERIES VIDE WHICH LAND SO LD (B) MAY OF JAIPUR NAGAR NIGAM (C) COPY OF BANK ACCOUNT (D) CERTIFICATE FROM PANCHYAT SAMITI BHAMBHARIA. 5. SINCE THE ASSESSMENT WAS MADE EXPARTE, THEREFORE . THE LD. CIT (A) ADMITTED THE EVIDENCES AND SENT THE SAME TO THE A.O. THE A.O. IN HIS REMAND REPORT STATED THAT SUCH EVIDENCES BE NOT ACCEPTED AS THE ASSESSEE WAS PROVIDED ADEQUA TE OPPORTUNITIES. HOWEVER THE LD. CIT (A) ACCEPTED THE ADDITIONAL EVIDENCES. THE LD. CIT (A) HELD THAT THE LAND IS SITUATED WITHIN 8 KMS OF JAIPUR. ACCORDINGLY THE LD. CIT (A) DIRECTED THE A. O TO COMPUTE CAPITAL GAIN AS PER LAW. 6. IN THE GROUND OF APPEAL, REFERENCE HAS BEEN MADE TO THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT V SHANKAR LAL VED PRAKASH 212 CTR 47. IT WILL BE USEFUL TO REPRODUCE HELD PORTION AS UNDER: SEC.27 OF THE GENERAL CLAUSES ACT SPECIFIES THAT SE RVICE OF A NOTICE WOULD BE LEGALLY PROPER IF THE TRANSMISSION IS THROUGH REGIS TERED POST. THE SECOND 3 PRESUMPTION IN S.27 OF THE GENERAL CLAUSES ACT IS T HAT, UNLESS THE CONTRARY IS PROVED, A LETTER DISPATCHED BY REGISTERED POST WOUL D BE DEEMED TO HAVE BEEN DELIVERED IN THE ORDINARY COURSE OF POST. THE NOTIC ES UNDER S.143(2) WERE UNDISPUTEDLY DISPATCHED ON 25 TH AUG, 1998; THE ASSESSEE HAS ACQUIESCED TO THE STATEMENT THAT THIS ENVELOPE HAD REACHED CIVIL LINE S POST OFFICE ON THE NEXT DAY ITSELF. 25 TH AUG., 1998 FELL ON A TUESDAY. DESPITE THE ASSERTIO N THAT THE ENVELOPE HAD REACHED THE CIVIL LINES POST OFFICE ON 26 TH AUG., 1998, IT WOULD BE FAIR FOR THE COURT TO PRESUME THAT A LOCAL LETTER WOULD REACH TH E ADDRESSEE WITHIN THREE DAYS I.E. FRIDAY 28 TH AUG, 1998. THE NOTICE CONVEYED TO THE ASSESSEE THA T A HEARING HAD BEEN FIXED BY THE AO ON 31 ST AUG., 1998. IF THE NOTICE HAD, IN FACT, BEEN SERVE D ON THE ASSESSEE ON 1 ST SEPT, 1998, IT IS UNNATURAL THAT NO ENQUIRIES OR C ORRESPONDENCE WOULD HAVE BEEN IMMEDIATELY MADE TO THE AO STATING THAT THE PROPOSED PROCEEDINGS HAD BECOME TIME BARRED. RELIANCE ON THE ASSESSEES LETTERS DT. 11 TH FEB, 2000, 17 TH FEB, 2000, 23 RD FEB, 2000 AND 19 TH JUNE, 2000 IS OF NO AVAIL BECAUSE OF THE LAPSE OF OVER ONE YEAR. IT WOULD ALS O BE TOO SANGUINE TO ACCEPT THE EXPLANATION OF THE ASSESSEE THAT THE ENVELOPE CONTA INING THE NOTICE DT. 25 TH AUG, 1998 HAD BEEN FOOLISHLY DESTROYED BY THE ASSESSEE . ASSESSEES AVOID OR REFUSE ACCEPTING INCONVENIENT COMMUNICATIONS OR PROCRASTIN ATE ACCEPTING THE NOTICES UNTIL IT IS CONVENIENT FOR THEM TO ACCEPT THESE NOT ICES. SINCE IT IS FAIR TO PRESUME THAT THE LETTER DISPATCHED ON 25 TH AUG, 1998 WOULD HAVE REACHED THE HANDS OF THE ADDRESSEE/ASSESSEE AT LEAST BY 28 TH AUG, 1998, THE INTERVENING DATES OF 29 TH AUG, 1998 AND 31 ST AUG, 1998 NEED TO BE SATISFACTORILY EXPLAINED AWAY BY THE ASSESSEE AND NOT THE DEPARTMENT, AS ENVISAGED BY S. 114 OF T HE EVIDENCE ACT, IF NOT S.27 OF THE GENERAL CLAUSES ACT. THE ASSESSEES CASE IS THA T THE NOTICE WAS RECEIVED BY HIM ON 1 ST SEPT, 1998. IT WOULD HAVE BEEN NORMAL FOR HIM TO A DDRESS A COMMUNICATION TO THE AO FORTHWITH OR AT LEAST WITHI N A MONTH TO THE EFFECT THAT PROPOSED PROCEEDINGS HAD BEEN RENDERED LEGALLY INEF FICACIOUS. THE ASSESSEE COULD ALSO HAVE OBTAINED A CERTIFICATE FROM THE POS TAL DEPARTMENT SINCE HE WAS FULLY AWARE OF THE IMPORTANCE OF THE DATE OF DELIVE RY. THE ASSESSEE HAS HOPELESSLY FAILED TO DISCHARGE THE BURDEN WHICH SHIFTED TO HIM IMMEDIATELY ON HIS ASSERTION THAT HE HAD RECEIVED THE NOTICE ON A PARTICULAR DAT E. BECAUSE NOTICE WAS DISPATCHED ON 25 TH AUG, 1998, AND WAS DULY ADDRESSED AND STAMPED, THE DEPARTMENT HAS SUCCEEDED IN PROVING ITS SERVICE BEF ORE 31 ST AUG, 1998. ON THE OTHER HAND, THE ASSESSEE HAS FAILED TO PROVE HIS ST ATEMENT THAT HE RECEIVED THE NOTICE ONLY ON 1 ST SEPT, 1998. DIRECTOR OF IT VS. GORDHAN THADDANI (I T APPEAL NO.640 OF 2006 DT. 16 TH OCT, 2006) AND CIT VS. LUNAR DIAMONDS LTD. (2005) 197 CTR (DEL) 312 : (2006) 281 ITR 1 (DEL) DISTINGUISHE D. 7. IT IS NOTICED THAT THE ASSESSEE STANDS EXPIRED A ND THE LEGAL HEIRS CAN NOT BE AWARE AS TO WHETHER THE NOTICES WERE ACTUALLY RECEIVED OR NOT. WHY THE ASSESSEE DURING HIS LIFETIME DID NOT TAKE ANY STEP TO MAKE COMPLIANCE IS NOT KNOWN TO LE GAL HEIR. RULE 46A PROVIDES THAT ADDITIONAL EVIDENCES CAN BE FILED IN CASE THE ASSESSEE WAS PRE VENTED BY REASONABLE CAUSE OR SUFFICIENT CAUSE IN PRODUCING THE EVIDENCE BEFORE THE A.O. IN THE IN STANT CASE, APPELLANTS WERE LEGAL HEIRS BEFORE 4 LD. CIT (A). THEY WERE HAVING A REASONABLE AND SUFF ICIENT CAUSE AND SUCH ADDITIONAL EVIDENCES WERE NECESSARY TO DECIDE THE ISSUE. HENCE ADMISSION OF EVIDENCES BY LD. CIT (A) IS CORRECT. IT IS NOT CLEAR AS TO WHY THE A.O. HAS NOT OFFERED HIS CO MMENTS ON THE ADDITIONAL EVIDENCES. THE DECISION TO ADMIT ADDITIONAL EVIDENCES IS OF LD. CI T (A) AND THE A.O. MAY OBJECT BUT IT IS ALSO HIS DUTY TO GIVE HIS COMMENTS ON THE ADDITIONAL EVIDENC ES. SINCE THE A.O. HAS NOT OFFERED HIS COMMENTS EITHER BEFORE LD. CIT (A) OR BEFORE US, WE FEEL THAT LD. CIT (A) WAS JUSTIFIED IN GIVING THE DIRECTION IN THE ORDER. IN THE RESULT THE APPEAL OF THE REVENUE IS DISMISS ED. THE ORDER IS PRONOUNCED IN OPEN COURT ON 22.12.201 1 SD/- SD/- (R.K.GUPTA) (N.L.KALRA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 22.12.2011 *S.KUMAR* COPY FORWARDED TO:- 1. THE INCOME TAX OFFICER, WARD-7, (2), JAIPUR. 2. LATE SHRI GYARSI LAL, SHARMA, JAIPUR 3. THE CIT 4. THE CIT(A), 5. THE D/R, ITAT, JAIPUR 6. THE GUARD FILE IN ITA NO.753/JP/2010 BY ORDER A.R., I.T.A.T., JAIPUR