Shri Navratan Singh Jain, Mumbai V. The Income Tax Officer, Ward-2(3)(8), Surat

ITA 791/AHD/2017

• Counselvise Citation: [2018] 118 COUNSELVISE.COM (IT) 2183 (ITAT-SURAT)
• Duration Of Justice: 1 year(s) 5 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-09-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2012-2013
• Appeal Filed On: 30-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SRINIVAS T BIDARI
• Assessee Lawyers: PRAKASH JUNJUNWALA
• Keywords: Opportunity of being heard; Opportunity of cross examination; Additional evidence

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT , , BEFORE SHRI C.M.GARG, JUDICIAL MEMBER AND SHRI O.P.MEENA, ACCOUNTANT MEMBER . / ITA NO.791/AHD/2017/SRT / ASSESSMENT YEAR: 2012-13 NAVRATAN SINGH JAIN, 302, RISHABH APARTMENT, HAFFALIA, MAHIDHARPURA, SURAT. [PAN: AHYPJ 4038 J] VS. THE INCOME TAX OFFICER, WARD-2(3)(8), SURAT ( / APPELLANT) ( !' /RESPONDENT) / ASSESSEE BY : SHRI PRAKASH JUNJUNWALA, CA /REVENUE BY : SHRI SRINIVAS T. BIDARI, CIT-DR /DATE OF HEARING : 20-06-2018 / DATE OF PRONOUNCEMENT : 18-09-2018 / ORDER PER C.M.GARG, JUDICIAL MEMBER: THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX(APPEALS)-1, SURA T (CIT(A) FOR SHORT) DATED 27.01.2017 FOR THE ASSESSMENT YEAR 201 2-13. 2. THE GROUNDS RAISED BY THE ASSESSEE READ AS FOLLO WS : THE APPELLANT PREFERS AN APPEAL AGAINST AN ORDER D ATED 27/01/2017 PASSED BY LD. COMMISSIONER OF INCOME TAX (APPEAL) 1, SURAT ON FOLLOWING AMONGST OTHER GROUNDS EACH OF WH ICH ARE WITHOUT PREJUDICE TO ANY OTHER :- 2 ITA NO.791/AHD/2017/SRT (A.Y: 2012-13) NAVRATAN SINGH JAIN 1.0. ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, LD. CIT(A) ERRED IN SUSTAINING THE DISALLOWANCE OF PURCHASE MA DE FROM ALLEGED NON-GENUINE PARTIES OF RS.7,42,79,471/-; 2.0. THE LD. CIT(A), BEFORE CONFIRMING THE DISALLO WANCE OF PURCHASE OF RS 7,42,79,471/-, OUGHT TO HAVE CONSIDERED THE UNDE RSTATED VITAL FACTS, BEING; A) THE DOCUMENTARY EVIDENCES SUCH AS BILLS, CHALLANS, CONFIRMATIONS, BANK STATEMENTS, STOCK REGISTER AND OTHER DOCUMENTS ARE FILED ON RECORD; B) THE ENTIRE PAYMENTS ARE UNDISPUTEDLY MADE BY A/C PA YEE CHEQUES; C) THE SUPPLIERS, IN RESPONSE TO NOTICE U/S 133(6), HA D CONFIRMED THE ENTIRE TRANSACTIONS MADE WITH THE APP ELLANT; C) THE DISPUTED PURCHASES ARE SUPPORTED WITH CORRESPONDING SALES ACCEPTED AS GENUINE IN ASSESSME NT ORDER; D) THE LD. AO HAS NOT REJECTED THE APPELLANT'S BOOKS U /S. 145(3) AND HAS NOT POINTED ANY DEFECT IN AUDITED BO OKS OF ACCOUNTS; E) THE STATEMENT OF 3 RD PARTY MR. PRAVIN KUMAR JAIN RECORDED AT BACK OF THE APPELLANT IS TOO GENERAL IN NATURE AND IS RETRACTED BY THE SAID PARTY; F) THE APPELLANT WAS NOT PROVIDED A COPY OF STATEMENT OF SHRI PRAVIN JAIN FOR CONFRONTATION AND AN OPPORTUNI TY OF CROSS EXAMINATION WAS ALSO NOT ALLOWED TO THE APPEL LANT; 3.0. WITHOUT PREJUDICE, LD. CIT(A) OUGHT TO HAVE S USTAINED THE DISALLOWANCE OF DISPUTED PURCHASE ON ESTIMATING THE REAL PROFIT EMBEDDED IN ALLEGED NON-GENUINE PURCHASE. THE APPEL LANT CRAVES LEAVE TO ADD, AMEND, ALTER AND/OR WITHDRAW ANY OF T HE GROUNDS OF APPEAL AT THE TIME OF HEARING. APPLICATION OF THE ASSESSEE UNDER RULE 29 OF THE IN COME TAX APPELLATE RULES, 1963 (IN SHORT 'THE RULES). 3. WE HAVE HEARD THE ARGUMENTS OF BOTH SIDES AND CA REFULLY PERUSED THE RELEVANT MATERIAL PLACED ON THE RECORD OF THE T RIBUNAL. THE ASSESSEE HAS FILED APPLICATION IN THE FORM OF AN AFFIDAVIT O F THE ASSESSEE SWORN ON 10.05.2018 ALONG WITH LETTERS DATED 31.01.2015, 23. 03.2015 AND 21.03.2015 FILED BEFORE THE ASSESSING OFFICER (AO) AND SUBMISSIONS 3 ITA NO.791/AHD/2017/SRT (A.Y: 2012-13) NAVRATAN SINGH JAIN DATED 22.02.2016 FILED BEFORE THE LD. CIT(A). THE L D. ASSESSEES REPRESENTATIVE (AR) SUBMITTED THAT DURING THE ASSES SMENT PROCEEDINGS THE ASSESSEE FILED THREE WRITTEN SUBMISSIONS ALONG WITH DOCUMENTARY EVIDENCES TO JUSTIFY THE GENUINENESS OF PURCHASES M ADE FROM THE M/S. JOSH TRADING PVT. LTD. THE COVERING LETTERS AND SUB MISSIONS FILED BEFORE THE AO ALSO BEARING ACKNOWLEDGEMENT SIGNATURE/STAMP S. THE AO WAS REQUESTED TO PROVIDE COPY OF THE CONTRARY MATERIAL AND TO ALLOW THE OPPORTUNITY OF CROSS EXAMINATION, BUT DESPITE OF WR ITTEN REQUESTS HE DID NOT ALLOW OPPORTUNITY OF CROSS EXAMINATION. 4. THE LD. AR ALSO SUBMITTED THAT DURING THE COURSE OF FIRST APPELLANT PROCEEDINGS THE ASSESSEE HANDED OVER ALL THE DOCUME NTS FILED BEFORE THE AO TO THE CA, WHO FILED VIDE LETTER DATED 20.08.201 6 AND ON 22.08.2016 WRITTEN SUBMISSIONS WERE ALSO FILED, BUT THE BOOKLE T CONTAINING SUPPORTING DOCUMENTS HAD NOT BEEN FILED BEFORE THE LD. CIT(A) WHICH WAS CAUSED DUE TO NON-PRESENCE OF THE ASSESSEE IN THE SURAT AN D OMISSION ON THE PART OF AR, WHO WAS PURSUING THE CASE BEFORE THE LD . CIT(A). THE LD. AR FURTHER SUBMITTED THAT THE NON-APPEARANCE BEFORE TH E LD. CIT(A) ON 20.09.2016 AND 12.01.2017 WAS UN-WILLFUL UNDER THE BONAFIDE REASONS AS THE ASSESSEE HAD GONE TO HIS NATIVE PLACE SITUATED AT KEKRI, AJMER, RAJASTHAN TO SETTLE FAMILY LITIGATION AND ANCESTRAL PROPERTY MATTERS. THE 4 ITA NO.791/AHD/2017/SRT (A.Y: 2012-13) NAVRATAN SINGH JAIN LD. AR FURTHER SUBMITTED THAT THE CA APPEARED BEFOR E THE LD. CIT(A) ON 25.01.2017 AND FILED ADJOURNMENT APPLICATION WHICH WAS REJECTED AND LD. CIT(A) PASSED EX-PARTE ORDER ON 27.01.2017 THEREFOR E, UNDER THESE BONAFIDE REASONS AND DUE TO NON-PRESENCE OF ASSESSE E IN SURAT THE PROPER COMPLIANCE COULD NOT BE DURING FIRST APPELLA TE PROCEEDINGS. THE LD. AR SUBMITTED THAT THE APPEAL MAY KINDLY BE DECI DED BY CONSIDERING THE ALL DOCUMENTS AND EVIDENCE WHICH COULD NOT BE P RODUCED BEFORE THE LD. CIT(A) ALTERNATIVELY AFTER ADMITTING ADDITIONAL EVIDENCE THE CASE MAY KINDLY BE RESTORED EITHER TO THE FILE OF THE A.O OR TO THE LD. CIT(A) FOR A FRESH ADJUDICATION. 5. REPLYING TO THE ABOVE, THE LD. DR STRONGLY OPPOS ED TO THE ADMISSION OF ADDITION EVIDENCE AND SUBMITTED THAT WHILE THE A SSESSEE IS NOT COOPERATING NEITHER BEFORE THE AO NOR BEFORE THE LD . CIT(A) THEN, THE AUTHORITIES HAVE NO OPTION, BUT TO DECIDE THE CASE ON THE BASIS OF MATERIAL AVAILABLE ON RECORD AND THE LD. FIRST APPELLATE AUT HORITY WAS RIGHT IN DECIDING THE APPEAL EXPARTILY. HOWEVER, IN ALL FA IRNESS, ON THE SPECIFIC QUERY FROM THE BENCH, THE LD. DR SUBMITTED THAT ON THE FACTS NARRATED BY THE ASSESSEE APPELLANT IN THE APPLICATION IN HAND U NDER RULE 29 OF THE RULES, IN THE FORM OF AFFIDAVIT HAVE NOT BEEN CONTR OVERTED BY THE AO BY ANY MANNER NEITHER BY WAY OF WRITTEN REPLY NOR BY W AY OF AFFIDAVIT IN 5 ITA NO.791/AHD/2017/SRT (A.Y: 2012-13) NAVRATAN SINGH JAIN REBUTTAL. THE LD. DR SUBMITTED THAT THE DEPARTMENT HAS NO SERIOUS OBJECTION IF IT IS FOUND JUST AND PROPER TO RESTORE THE ISSUE TO THE FILE OF THE A.O FOR A FRESH ADJUDICATION. 6. ON CAREFUL CONSIDERATION OF ABOVE RIVAL SUBMISSI ONS, FIRST OF ALL, WE MAY POINT OUT THAT AS PER R. 29 OF THE RULES PRODUC TION OF ADDITIONAL EVIDENCE BEFORE THE TRIBUNAL HAS BEEN PRESCRIBED. WE FIND IT PROFITABLE TO REPRODUCE THE RULE 29 OF THE RULES, FOR THE SAKE OF CLARITY IN OUR FINDINGS, WHICH READS AS UNDER: PRODUCTION OF ADDITIONAL EVIDENCE BEFORE THE TRIBU NAL. 29. THE PARTIES TO THE APPEAL SHALL NOT BE ENTITLED TO PRODUCE ADDITIONAL EVIDENCE EITHER ORAL OR DOCUMENTARY BEFO RE THE TRIBUNAL, BUT IF THE TRIBUNAL REQUIRES ANY DOCUMENT TO BE PRO DUCED OR ANY WITNESS TO BE EXAMINED OR ANY AFFIDAVIT TO THE FILE D TO ENABLE IT TO PASS ORDERS OR FOR ANY OTHER SUBSTANTIAL CAUSE, OR, IF THE INCOME TAX AUTHORITIES HAVE DECIDED THE CASE WITHOUT GIVING SU FFICIENT OPPORTUNITY TO THE ASSESSEE TO ADDUCE EVIDENCE EITHER ON POINTS SPECIFIED BY THEM OR NOT SPECIFIED BY THE, THE TRIBUNAL, FOR REA SONS TO BE RECORDED, MAY ALLOW SUCH DOCUMENT TO BE PRODUCED OR WITNESS T O BE EXAMINED OR AFFIDAVIT TO BE FILED OR MAY ALLOW SUCH EVIDENCE TO BE ADDUCED. 7. FROM THE ABOVE, IT IS APPARENT THAT PARTIES ARE NOT ENTITLED TO PRODUCE ADDITIONAL EVIDENCE EITHER ORAL OR DOCUMENT BEFORE THE TRIBUNAL BUT THE SAME CAN BE PRODUCED UNDER TWO CIRCUMSTANCE S FIRSTLY, IF THE TRIBUNAL REQUIRES ANY DOCUMENT TO BE PRODUCE OR ANY WITNESS TO BE EXAMINED OR ANY AFFIDAVIT TO BE FILED TO ENABLE THE TRIBUNAL TO PASS ORDERS OR FOR ANY OTHER SUBSTANTIAL CAUSE AND SECONDLY, IF THE INCOME TAX AUTHORITIES DECIDED THE CASE WITHOUT GIVING SUFFICI ENT OPPORTUNITY TO THE 6 ITA NO.791/AHD/2017/SRT (A.Y: 2012-13) NAVRATAN SINGH JAIN ASSESSEE TO ADDUCE EVIDENCE THEN THE TRIBUNAL FOR T HE REASONS TO BE RECORDED MAY ALLOW SUCH DOCUMENT TO BE PRODUCED AND EVIDENCE TO BE ADDUCED. 8. IN THE PRESENT CASE, THERE IS NO REQUIREMENT OF THE TRIBUNAL TO CALL THE ASSESSEE TO FILE ANY EVIDENCE, DOCUMENT OR AFFI DAVIT THEREFORE, FIRST LIMB OF THIS RULE IS NOT APPLICABLE TO THE PRESENT CASE. SO FAR AS APPLICABILITY OF SECOND LIMB OF THE RULE 29 OF THE RULE IS CONCERNED, IN THE PRESENT CASE THE ASSESSEE HAS FILED HIS AFFIDAVIT B Y NARRATING THE FACTUAL POSITION AT THE TIME OF ASSESSMENT AND FIRST APPELL ATE PROCEEDINGS AND HAS STATED THAT DUE TO HIS PHYSICAL ABSENCE AT SURA T HIS CASE WAS NOT PROPERLY PLACED AND ARGUED BEFORE THE AUTHORITIES B ELOW WHICH RESULTED INTO EX-PARTE ORDER OF THE LD. CIT(A). IT HAS ALSO BEEN STATED IN THE AFFIDAVIT THAT THE ASSESSEE WAS AWAY FROM SURAT AT RAJASTHAN TO SETTLE ISSUES AND LITIGATIONS PERTAINING TO HIS ANCESTRAL PROPERTY AND THE CAUSES STATED IN THE AFFIDAVIT APPEARS TO BE BONAFIDE AND REASONABLE. THE COPIES OF THE THREE SUBMISSIONS MADE BEFORE THE AO ALSO SH OW THAT THE ASSESSEE PURSUED THE MATTER BEFORE THE AO AND DURIN G FIRST APPELLATE PROCEEDINGS THE ASSESSEE ALSO FILED LETTER DATED 20 .08.2016 AND 22.08.02016 THEREAFTER ON BEHALF OF HIM HIS CA ALSO FILED ADJOURNMENT APPLICATION ON 2501.2017WHICH WAS DISMISSED AND THE LD. CIT(A) PASSED 7 ITA NO.791/AHD/2017/SRT (A.Y: 2012-13) NAVRATAN SINGH JAIN ORDER ON 27.01.2017 EXPARTILY. THERE IS NO REBUTTA L BY THE AO TO THIS AFFIDAVIT HENCE, IT HAS REMAINED UN-REBUTTED AND TH E FACTS STATED THEREIN DESERVE TO BE ACCEPTED AS BONAFIDE REASON WHICH PREVENTED THE ASSESSEE FROM FILING THESE RELEVANT DOCUMENTS BEFOR E THE AUTHORITIES BELOW AND WHICH ALSO RESULTED INTO EX-PARTE ORDER O F THE LD. CIT(A) WHICH HAS BEEN PASSED WITHOUT ALLOWING/GIVING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. IN THIS SITUATION, SECOND LIMB OF R. 29 OF THE RULES SUPPORTS THE PRAYER OF THE ASSESSEE FOR ADMISSION OF ADDITIONAL EVIDENCE AND THUS, LOOKING INTO ENTIRE FACTS AND CIRCUMSTANCES OF THE CASE, WE ALLOW THE APPLICATION OF THE ASSESSEE AND ADDITIONAL EVIDENCE D FILED BY THE ASSESSEE IS ADMITTED. 9. SINCE, ADDITIONAL EVIDENCE HAS BEEN ADMITTED BY THE EARLIER PART OF THIS ORDER, WHICH WAS NOT CONFRONTED TO THE AO. HO WEVER, THE LD. CIT(A) HAS PASSED EX-PARTE ORDER, BUT TO AVOID MULTIPLICIT Y OF PROCEEDINGS, WE FIND IT JUST PROPER AND REASONABLE TO RESTORE THE I SSUE TO THE FILE OF THE A.O FOR A FRESH ADJUDICATION AFTER ALLOWING DUE OPPORTU NITY OF HEARING TO THE ASSESSEE AND WITHOUT BEING PREJUDICE FROM THE EARLI ER ASSESSMENT AND FIRST APPELLATE ORDER. SINCE, WE HAVE RESTORED THE CASE TO THE FILE OF THE A.O TO THE ASSESSMENT STAGE FOR FRAMING DENOVO ASSESSMENT ORDER 8 ITA NO.791/AHD/2017/SRT (A.Y: 2012-13) NAVRATAN SINGH JAIN THEREFORE, OTHER ISSUES OF THE ASSESSEE ON MERITS B ECOME INFRUCTUOUS AND WE ARE NOT ADJUDICATING THEM AS HAVING BECOME INFRU CTUOUS. 10. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY OF 1 8 TH SEPTEMBER, 2018 / SURAT; DATED : 18 TH SEPTEMBER, 2018 / EDN ! $ / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT ; 3. # ( ) / THE CIT(A)-I, SURAT; 4. PRL. CIT-2, SURAT; 5. , , / DR, ITAT, SURAT; 6. / GUARD FILE . / BY ORDER, // TRUE COPY // //TRUE COPY/ ) / ASSISTANT REGISTRAR , / ITAT, SURAT SD/- SD/- ( ) (O.P.MEENA) /ACCOUNTANT MEMBER ( ) (C.M.GARG) /JUDICIAL MEMBER