Prankrishna Bag, Purba Medinipur V. ITO, WD-3, HALDIA, Haldia

ITA 755/KOL/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 4773 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-06-2016
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 28-05-2015
• Court: TRIBUNAL
• Assessee Lawyers: ATIN DAS; RABINDRANATH DAS
• Keywords: Unexplained investment; Opportunity of being heard; Principle of natural justice; Peak credit; Additional evidence
• Section: 143(3)

Judgement Text

I.T.A. NO. 755/KOL./2015 ASSESSMENT YEAR: 2008-2009 PAGE 1 OF 5 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA B(SMC) BENCH, KOLKATA BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER I.T.A. NO. 755 /KOL/ 2015 ASSESSMENT YEAR: 2008-2009 PRANKRISHNA BAG,................................... ............................APPELLANT NANDAKUMAR, PURBA MEDINIPUR-721 643 [PAN : AJAPB 7873 K -VS.- INCOME TAX OFFICER,................................ ............................RESPONDENT WARD-3, HALDIA, BASUDEVPUR, KHANJANCHAK, HALDIA-721 602 APPEARANCES BY: SHRI RABINDRANATH DAS AND SHRI ATIN DAS, ADVOCATE, FOR THE ASSESSEE SHRI PRABAL CHOUDHURY, JCIT, SR. D.R., FOR THE DEPARTMENT DATE OF CONCLUDING THE HEARING : APRIL 29, 2016 DATE OF PRONOUNCING THE ORDER : JUNE 03, 2016 O R D E R THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX-(APPEALS)-7, KOLKATA DATED 19.03.2015 FOR THE ASSESSMENT YEAR 2008-09, WHEREBY HE CONFIRM ED THE ADDITION OF RS.8,79,719/- MADE BY THE ASSESSING OFFICER TO THE TOTAL INCOME OF THE ASSESSEE ON ACCOUNT OF PEAK CREDITS APPEARING IN TH E UNDISCLOSED BANK ACCOUNTS OF THE ASSESSEE AND FURTHER ENHANCED THE S AME BY RS.15,97,560/-. 2. THE ASSESSEE IN THE PRESENT CASE IS AN INDIVIDUA L, WHO IS ENGAGED IN THE BUSINESS OF DEALING IN FRUITS ON WHOLESALE BASI S. THE RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION WAS FILED BY HIM O N 30.09.2008 DECLARING TOTAL INCOME OF RS.1,28,900/-. AS PER THE INFORMATION RECEIVED BY THE ASSESSING OFFICER, THE ASSESSEE WAS MAINTAIN ING THREE BANK I.T.A. NO. 755/KOL./2015 ASSESSMENT YEAR: 2008-2009 PAGE 2 OF 5 ACCOUNTS WITH UTI (AXIS) BANK LIMITED, BHIMERBAZAR, TAMLUK. THE SAID ACCOUNTS, HOWEVER, WERE NOT APPEARING IN THE BALANC E-SHEET FILED BY THE ASSESSEE ALONG WITH THE RETURN OF INCOME FOR THE YE AR UNDER CONSIDERATION. DURING THE COURSE OF ASSESSMENT PROC EEDINGS, PERSONAL BALANCE-SHEET WAS FILED BY THE ASSESSEE IN WHICH ON E OF THE THREE BANK ACCOUNTS MAINTAINED WITH AXIS BANK LIMITED WAS REFL ECTED. AS REGARDS THE REMAINING TWO BANK ACCOUNTS, THE ASSESSEE COULD NOT OFFER ANY SATISFACTORY EXPLANATION IN RESPECT OF SUBSTANTIAL TRANSACTIONS REFLECTED THEREIN, WHICH HAD REMAINED UNDISCLOSED. THE ASSESS ING OFFICER, THEREFORE, TREATED THE PEAK CREDITS APPEARING IN TH E SAID TWO BANK ACCOUNTS AGGREGATING TO RS.8,79,719/- AS UNEXPLAINE D INVESTMENT OF THE ASSESSEE AND THE SAME WAS ADDED BY HIM TO THE TOTAL INCOME OF THE ASSESSEE IN THE ASSESSMENT COMPLETED UNDER SECTION 143(3) VIDE AN ORDER DATED 27.12.2010. 3. AGAINST THE ORDER PASSED BY THE ASSESSING OFFICE R UNDER SECTION 143(3), AN APPEAL WAS PREFERRED BY THE ASSESSEE BEF ORE THE LD. CIT(APPEALS) DISPUTING THE ADDITION OF RS.8,79,719/ - MADE ON ACCOUNT OF PEAK CREDITS APPEARING IN THE UNDISCLOSED BANK ACCO UNTS TREATING THE SAME AS UNEXPLAINED INVESTMENT. DURING THE COURSE O F APPELLATE PROCEEDINGS BEFORE THE LD. CIT(APPEALS), A WRITTEN SUBMISSION WAS FILED BY THE ASSESSEE ALONG WITH ADDITIONAL EVIDENCE. THE SAME WAS FORWARDED BY THE LD. CIT(APPEALS) TO THE ASSESSING OFFICER, W HO IN TURN SUBMITTED HIS REMAND REPORT TO THE LD. CIT(APPEALS) OFFERING HIS COMMENTS ON THE WRITTEN SUBMISSION FILED BY THE ASSESSEE AS WELL AS THE ADDITIONAL EVIDENCE. WHEN THE REMAND REPORT SUBMITTED BY THE A SSESSING OFFICER WAS CONFRONTED BY THE LD. CIT(APPEALS) TO THE ASSES SEE, THE ASSESSEE FILED HIS REJOINDER IN WRITING. AFTER TAKING INTO CONSIDE RATION THE ENTIRE MATERIAL AVAILABLE ON RECORD BEFORE HIM, THE LD. CI T(APPEALS) WAS OF THE VIEW THAT THE PEAK CREDIT WORKED OUT BY THE ASSESSI NG OFFICER IN RESPECT OF TWO UNDISCLOSED BANK ACCOUNTS OF THE ASSESSEE WA S NOT CORRECT. ACCORDING TO HIM, SUCH PEAK CREDITS IN THE TWO UNDI SCLOSED BANK ACCOUNTS OF THE ASSESSEE WERE ACTUALLY MORE THAN WHAT WAS TA KEN BY THE ASSESSING I.T.A. NO. 755/KOL./2015 ASSESSMENT YEAR: 2008-2009 PAGE 3 OF 5 OFFICER. HE WAS ALSO OF THE VIEW THAT THE PEAK CRED IT OF THE THIRD ACCOUNT OF THE ASSESSEE MAINTAINED WITH THE AXIS BANK LIMIT ED WAS ALSO LIABLE TO BE ADDED TO THE TOTAL INCOME OF THE ASSESSEE, WHICH HAD NOT BEEN DONE BY THE ASSESSING OFFICER AND THERE WAS FAILURE ON THE PART OF THE ASSESSING OFFICER EVEN TO MAKE ADDITION ON ACCOUNT OF INTERES T OF RS.11,767/- CREDITED IN THE SAID BANK ACCOUNTS. HE, THEREFORE, ISSUED ENHANCEMENT NOTICE UNDER SECTION 251(2) OF THE ACT REQUIRING TH E ASSESSEE TO SHOW- CAUSE AS TO WHY THE ADDITION OF RS.8,79,719/- MADE BY THE ASSESSING OFFICER ON THIS ISSUE SHOULD NOT BE ENHANCED TO RS. 24,76,739/-. SINCE THE ASSESSEE FAILED TO OFFER ANY SATISFACTORY EXPLANATI ON IN RESPONSE TO THE SAID NOTICE, THE LD. CIT(APPEALS) PROCEEDED TO CONF IRM THE ADDITION OF RS.8,79,719/- MADE BY THE ASSESSING OFFICER AND FUR THER ENHANCED THE SAME BY RS.15,97,560/- THEREBY MAKING THE TOTAL ADD ITION ON THIS ISSUE OF RS.24,76,739/-. AGGRIEVED BY THE ORDER OF LD. CIT(A PPEALS), THE ASSESSEE HAS PREFERRED THIS APPEAL BEFORE THE TRIBUNAL. 4. I HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AND ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE PRELIMIN ARY ISSUE RAISED BY THE ASSESSEE IN HIS APPEAL IS THAT THE ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT OF PEAK CREDITS APPEARING IN HIS BANK AC COUNTS BY TREATING THE SAME AS UNEXPLAINED INVESTMENT HAS BEEN CONFIRMED B Y THE LD. CIT(APPEALS) AND FURTHER ENHANCED BY HIM WITHOUT GI VING PROPER AND SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESS EE. IN THIS REGARD, THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT WHE N THE APPEAL OF THE ASSESSEE WAS FINALLY FIXED FOR HEARING BY THE LD. C IT(APPEALS) ON 16.03.2015, THE ASSESSEE SOUGHT ADJOURNMENT BY WAY OF A WRITTEN APPLICATION DATED 10.03.2015, WHICH WAS SENT TO THE OFFICE OF THE LD. CIT(APPEALS) BY COURIER ON THE SAME DATE. HE HAS IN VITED OUR ATTENTION TO THE COPY OF THE SAID APPLICATION AS WELL AS THE COU RIER RECEIPT PLACED AT PAGE NO. 190 & 191 OF HIS PAPER BOOK AND SUBMITTED THAT THE LD. CIT(APPEALS) WITHOUT TAKING THE COGNIZANCE OF THE S AME HAS PROCEEDED TO DISPOSE OF THE APPEAL OF THE ASSESSEE BY HIS IMPUGN ED ORDER PASSED ON 19.03.2015. HE HAS CONTENDED THAT THE LD. CIT(APPEA LS) THUS HAS NOT GIVEN I.T.A. NO. 755/KOL./2015 ASSESSMENT YEAR: 2008-2009 PAGE 4 OF 5 PROPER AND SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE WHILE DISPOSING OF THE APPEAL BY HIS IMPUGNED ORDER. ALTH OUGH THE LD. D.R. HAS RAISED STRONG OBJECTION IN THIS REGARD BY SUBMITTIN G THAT SUFFICIENT OPPORTUNITY WAS ALREADY GIVEN BY THE LD. CIT(APPEAL S) TO THE ASSESSEE BY ADMITTING THE ADDITIONAL EVIDENCE AND SENDING THE S AME TO THE ASSESSING OFFICER FOR HIS COMMENTS AND AGAIN BY CONFRONTING T HE REMAND REPORT SUBMITTED BY THE ASSESSING OFFICER TO THE ASSESSEE WITH AN OPPORTUNITY TO FILE REJOINDER, THE FACT REMAINS TO BE SAME IS THAT THE APPEAL OF THE ASSESSEE WAS FINALLY FIXED FOR HEARING BY THE LD. C IT(APPEALS) ON 16.03.2015 AND EVEN THOUGH THE ASSESSEE SENT AN APP LICATION IN WRITING SEEKING ADJOURNMENT OF THE SAID HEARING WELL IN ADV ANCE BY COURIER, THE LD. CIT(APPEALS) HAS PROCEEDED TO DISPOSE OF THE AP PEAL OF THE ASSESSEE BY HIS IMPUGNED ORDER PASSED ON 19.03.2015 WITHOUT TAKING INTO CONSIDERATION THE REQUEST OF THE ASSESSEE FOR ADJOU RNMENT. IN MY OPINION, THE LD. CIT(APPEALS) THUS HAS DISPOSED OF THE APPEA L OF THE ASSESSEE BY HIS IMPUGNED ORDER WITHOUT GIVING PROPER AND SUFFICIENT OPPORTUNITY TO THE ASSESSEE AND THERE IS A CLEAR VIOLATION OF THE PRIN CIPLE OF NATURAL JUSTICE. IN THAT VIEW OF THE MATTER, I SET ASIDE THE IMPUGNE D ORDER OF THE LD. CIT(APPEALS) AND REMIT THE MATTER BACK TO HIM WITH A DIRECTION TO DISPOSE OF THE APPEAL OF THE ASSESESE AFRESH ON MERIT AFTER GIVING THE ASSESSEE PROPER AND SUFFICIENT OPPORTUNITY OF BEING HEARD. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TRE ATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON JUNE 3, 2016. SD/- (P.M. JAGTAP) ACCOUNTANT MEMBER KOLKATA, THE 3 RD DAY OF JUNE, 2016 COPIES TO : (1) SHRI PRANKRISHNA BAG, NANDAKUMAR, PURBA MEDINIPUR-721 643 I.T.A. NO. 755/KOL./2015 ASSESSMENT YEAR: 2008-2009 PAGE 5 OF 5 (2) INCOME TAX OFFICER, WARD-3, HALDIA, BASUDEVPUR, KHANJANCHAK, HALDIA-721 602 (3) COMMISSIONER OF INCOME TAX (APPEALS)-7, KOLKAT A, (4) COMMISSIONER OF INCOME TAX- , (5) THE DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.