M/s Kaithal Tractors, Kaithal V. ITO, Kaithal

ITA 788/CHANDI/2016

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9798 (ITAT-CHANDIGARH)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-07-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 13-06-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTALDR
• Assessee Lawyers: PERMIL GOEL
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH,CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA NO. 788/CHD/2016 ASSESSMENT YEAR: 2012-13 M/S KAITHAL TRACTORS, VS THE ITO, AMBALA ROAD, WARD 4, KAITHAL KAITHAL. PAN: AAJFK1071G (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI PERMIL GOEL RESPONDENT BY : SHRI S.K.MITTAL,DR DATE OF HEARING : 19.07.2016 DATE OF PRONOUNCEMENT : 22.07.2016 O R D E R THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF LD. CIT(APPEALS)-2, GURGAON DATED 28.03.2016 FOR ASSESSMENT YEAR 2012-13 CHALLENGING THE ADDITION OF RS. 2,40,000/-. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT DURING TH E COURSE OF ASSESSMENT PROCEEDINGS, AS REGARDS TRADE CREDITOR IN THE NAME OF SHRI AJAY KUMAR, ON GOING THROUGH THE LEDGER ACCOUNT AND CASH MEMO, IT WAS FO UND THAT A CASH OF RS. 2,40,000/- WAS RECEIVED ON 21.03.2012 WHEREAS THE CASH MEMO WAS ISSUED ON 31.05.2012. WHEN THE SAME WAS CONFRONTED TO THE 2 ASSESSEE, ASSESSEE SUBMITTED THAT AMOUNT OF RS. 2,40,000/- WAS RECEIVED IN FINANCIAL YEAR 2011-12. BUT WHEN THE CREDITOR WAS CALLED UPON, HE HAS STATED TH AT NO TRANSACTION WAS MADE IN FINANCIAL YEAR 2011-12 A ND THE TRACTOR WAS PURCHASED IN FINANCIAL YEAR 2012-13 AND PAYMENT HAD BEEN MADE IN THE SAME FINANCIAL YEAR. WHEN THE FACT WAS CONFRONTED TO THE ASSESSEE, ASSES SEE COULD NOT GIVE ANY PLAUSIBLE EXPLANATION BEFORE ASSESSING OFFICER, THEREFORE, RS. 2,40,000/- WAS TR EATED AS INCOME OF THE ASSESSEE FROM UNDISCLOSED SOURCES AND ADDITION WAS ACCORDINGLY MADE. THE LD. CIT(APPEALS ) CONFIRMED THE ADDITION. 3. AFTER CONSIDERING RIVAL SUBMISSIONS, I AM OF THE VIEW THAT MATTER REQUIRES RE-CONSIDERATION AT THE L EVEL OF THE ASSESSING OFFICER. THE LD. COUNSEL FOR THE ASS ESSEE SUBMITTED THAT A.O. HAS NOT CONFRONTED ANY STATEMENT/INFORMATION RECEIVED FROM SHRI AJAY KUMAR AT ASSESSMENT STAGE. THIS FACT WAS SPECIFICALLY RAISE D IN THE STATEMENT OF FACT BEFORE LD. CIT(APPEALS). THE ASSESSEE ALSO RAISED THE SUBMISSIONS BEFORE LD. CIT(APPEALS) THAT THE STATEMENT/INFORMATION RECEIVE D FROM SHRI AJAY KUMAR WAS NOT SUBJECTED TO CROSS OBJECTION ON BEHALF OF THE ASSESSEE. THE LD. CIT(APPEALS), THEREFORE, ASKED THE ASSESSING OFFICE R TO FURNISH THE DETAILS OF EVIDENCE COLLECTED FROM SHRI AJAY KUMAR. IT WAS FOUND THAT ASSESSING OFFICER HAD CAL LED FOR INFORMATION UNDER SECTION 133(6) FROM SHRI AJAY 3 KUMAR AND SHRI AJAY KUMAR HAD FILED A WRITTEN REPLY STATING THAT HE HAS NOT MADE ANY TRANSACTION DURING FINANCIAL YEAR 2011-12 WITH THE ASSESSEE BUT TRACTO R WAS PURCHASED FROM ASSESSEE FOR RS. 3,90,000/- DURING T HE FINANCIAL YEAR 2012-13 AND PAYMENT WAS ALSO MADE IN THE SAME FINANCIAL YEAR. THE COPY OF THE AFORESAID LETTER WAS PROVIDED TO THE ASSESSEE AT THE APPELLATE STAGE FOR HIS COMMENTS. THE ASSESSEE IN THE REPLY BEFORE LD. CIT(APPEALS) RAISED THE OBJECTION TO THE SAME AND A GAIN ASKED FOR THE OPPORTUNITY TO CROSS-EXAMINE SHRI AJA Y KUMAR. THE LD. CIT(APPEALS) DID NOT ACCEPT CONTENT ION OF THE ASSESSEE AND HELD THAT THE CONTENTION IS WIT HOUT ANY BASIS BECAUSE ONUS IS UPON ASSESSEE TO PROVE GENUINENESS OF THE TRANSACTION IN THE MATTER. IN T HIS VIEW OF THE MATTER, IT IS CLEAR THAT ASSESSING OFFI CER RECEIVED INFORMATION FROM SHRI AJAY KUMAR UNDER SECTION 133(6) OF THE ACT IN WHICH HE HAS DENIED GI VING OF ANY ADVANCE TO THE ASSESSEE IN ASSESSMENT YEAR U NDER APPEAL. THEREFORE, SUCH INFORMATION SHOULD HAVE BE EN SUPPLIED TO THE ASSESSEE AND ASSESSEE SHOULD HAVE B EEN GIVEN OPTION TO CROSS-EXAMINE SHRI AJAY KUMAR IN OR DER TO FIND OUT THE TRUTH. 3(I) THE LD. CIT(APPEALS), THOUGH HAS SUPPLIED REPL Y OF SHRI AJAY KUMAR TO THE ASSESSEE AT APPELLATE STAGE AND ASSESSEE IN HIS REJOINDER/WRITTEN SUBMISSION ASKED FOR THE CROSS-EXAMINATION OF SHRI AJAY KUMAR BUT LD. CIT(APPEALS) DID NOT AFFORD ANY OPPORTUNITY TO THE 4 ASSESSEE TO CROSS-EXAMINE SHRI AJAY KUMAR. THEREFO RE, THE ASSESSEE HAS BEEN DENIED OPPORTUNITY TO CROSS- EXAMINE SHRI AJAY KUMAR AND AS SUCH, PRINCIPLE OF NATURAL JUSTICE HAS BEEN VIOLATED. THE INFORMATION COLLECTED AT THE BACK OF THE ASSESSEE COULD BE USED IN EVIDENCE AGAINST THE ASSESSEE UNLESS ASSESSEE HAS B EEN ALLOWED OPPORTUNITY TO CROSS-EXAMINE SHRI AJAY KUMA R. I, THEREFORE, SET ASIDE THE ORDERS OF AUTHORITIES B ELOW AND RESTORE THE MATTER IN ISSUE TO THE FILE OF ASSE SSING OFFICER WITH DIRECTION TO RE-DECIDE THIS ISSUE AFTE R ALLOWING OPPORTUNITY TO THE ASSESSEE TO CROSS-EXAMI NE SHRI AJAY KUMAR. THE ASSESSING OFFICER SHALL GIVE REASONABLE SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND SHALL PASS THE ORDER IN ACCORDANCE WIT H LAW ON MERITS. 4. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DATED: 22 ND JULY, 2016. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR, ITAT/CHD