Rajesh Kumar Arora, New Delhi V. ITO, Ward-63(2), New Delhi

ITA 8174/DEL/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 4672 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-11-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 26-12-2018
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SMC NEW DELHI BEFORE SHRI H. S. SIDHU, JUDICIAL MEMBER I.T.A. NO. 8174/DEL/2018 ASSESSMENT YEAR: 2007-08 RAJESH KUMAR ARORA, VS. ITO, WARD 63(2), 169, 1 ST FLOOR, BHARAT NAGAR, NEW DELHI ASHOK VIHAR, NEW DELHI 52 (PAN: ADRPA4517A) (ASSESSEE) (RESPONDENT) ASSESSEE BY : SH. ASHISH GOYAL, CA & MRS. SURBHI GOYAL, CA REVENUE BY : SH. AMRIT LAL, SR. DR. ORDER THIS APPEAL IS FILED BY ASSESSEE AGAINST THE ORDER DATED 15.11.2018 PASSED BY THE LD. CIT(A)-18, NEW DELHI RELATING TO ASSESSMENT YEAR 2007-08 ON THE FOLLOWING GROUNDS:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ORDER PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) [CIT(A)] IS BAD BOTH IN THE EYE OF LAW AND ON FACTS . 2. (I)ON THE FACTS AND CIRCUMSTANCES OF THE CASE, T HE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN PASSING THE E XPARTE ORDER WITHOUT GIVING THE ASSESSEE AN OPPORTUNITY OF BEING HEARD IS CLEAR VIOLATION OF THE PRINCIPLE OF NATURA L JUSTICE. (II) THAT THE NON-APPEARANCE BEFORE THE CIT(A) WAS BECAUSE OF THE REASONS BEYOND THE CONTROL OF THE ASSESSEE. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN REJECT ING THE CONTENTION OF THE ASSESSEE THAT THE INITIATION OF T HE REASSESSMENT PROCEEDINGS AND THE REASSESSMENT ORDER ARE 2 BAD BOTH ON FACTS AND IN LAW AND LIABLE TO BE QUASH ED AS THE STATUTORY CONDITIONS AND PROCEDURE PRESCRIBED UNDER THE STATUTE HAVE NOT BEEN COMPLIED WITH. 4(I) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, T HE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN REJECT ING THE CONTENTION OF THE ASSESSEE THAT THE REASSESSMENT PR OCEEDINGS INITIATED BY THE LEARNED AO ARE BAD IN THE EYE OF L AW AS THE REASONS RECORDED FOR THE ISSUE OF NOTICE UNDER SECT ION 148 ARE BAD IN THE EYE OF LAW AND ARE CONTRARY TO THE FACTS . (II) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, T HE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN REJECT ING THE CONTENTION OF THE ASSESSEE THAT THE REASSESSMENT OR DER PASSED BY THE AO. IS BAD AND LIABLE TO BE QUASHED A S THE SAME HAS BEEN REOPENED ON THE BASIS OF THE REASONS WHICH ARE VAGUE AND HAS BEEN RECORDED WITHOUT APPLICATION OF MIND ON THE PART OF THE AO. 5. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN CONFIR MING THE ADDITION OF AN AMOUNT OF RS.4,83,821/- BEING THE PU RCHASES FROM M/S SHREE BANKEY BIHARI TRADING CO. 6. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN CONFIR MING THAT THESE ARE NOT ENGAGED IN THE ACTUAL BUSINESS IGNORI NG THE FACT THAT DURING THE COURSE OF THE SEARCH SUBSTANTIAL IN VENTORY IN RESPECT OF THE MATERIAL BEING PURCHASED BY THE ASSE SSEE WERE FOUND WHICH CONFIRM THE FACT THAT THESE FIRMS WERE DOING ACTUAL BUSINESS. 7. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN REJECT ING THAT THE INFERENCE DRAWN BY THE AO MERELY ON THE BASIS OF A STATEMENT 3 THAT THESE FIRMS ARE NOT IN ACTUAL BUSINESS IS BASE LESS AND CONTRARY TO THE FACTS ON RECORD. 8. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN CONFIR MING THE ADDITION DESPITE THE FACT THAT PURCHASES WERE MADE IN REGULAR COURSE OF THE BUSINESS AND MATERIAL SO PURCHASED WA S SOLD IN THE REGULAR COURSE OF BUSINESS. 9. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN REJECT ING THE CONTENTION OF THE ASSESSEE THAT THE ADDITION SO MAD E ON THE BASIS OF MATERIAL COLLECTED AT THE BACK OF THE ASSE SSEE IS BAD IN LAW AND LIABLE TO BE DELETED. 10. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN REJECT ING THE CONTENTION OF THE ASSESSEE THAT THE ADDITION MADE B Y THE LEARNED AO IS UNTENABLE IN THE EYE OF LAW HAVING BE EN MADE WITHOUT PROVIDING OPPORTUNITY TO CROSS EXAMINE THE PERSON ON THE BASIS OF WHOSE STATEMENT THE ALLEGATION HAVE BE EN MADE AGAINST THE ASSESSEE AND WITHOUT FOLLOWING THE PRIN CIPLE OF NATURAL JUSTICE. THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR ALTER A NY OF THE GROUNDS OF APPEAL. 2. AT THE TIME OF HEARING, LD. COUNSEL FOR THE ASS ESSEE STATED THAT THE ISSUE IN DISPUTE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE ITAT, SMC-3, BENCH DATED 25.11.2016 IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2006-07 PASSED IN ITA NO. 2861/DEL/2016. HE ATTACHED THE COPY OF THE SAID DECISION AT PAGE N OS. 25-46 OF THE PAPER BOOK. HE REQUESTED THAT RESPECTFULLY FOLLOWING TH E AFORESAID CASE, THE ISSUE IN DISPUTE MAY BE DECIDED IN FAVOUR OF THE A SSESSEE. BUT AT THE TIME OF HEARING, THE BENCH POINTED OUT THAT LD. CI T(A) HAS PASSED THE 4 IMPUGNED EXPARTE ORDER, BUT WHY THE ASSESSEE DID NO T APPEAR BEFORE THE LD. CIT(A) ON 04.10.2018; 24.10.2018 AND 14.11.2018 . BUT LD. AR FOR THE ASSESSEE COULD NOT GIVE ANY EXPLANATION FOR THE SAME. 3. ON THE CONTRARY, LD. DR HAS STRONGLY OPPOSED T HE REQUEST OF THE LD. COUNSEL FOR THE ASSESSEE AND STATED THAT ASSES SEE REMAINED COOPERATIVE BEFORE THE LD. CIT(A). HOWEVER, HE SHOU LD REPRESENT HIS CASE BEFORE THE LD. CIT(A) WHO PASSED ACCORDING TO FACTS OF THE CASE AND THE OTHER DOCUMENTARY EVIDENCES FILED BY THE ASSESSEE. 4. I HAVE HEARD BOTH THE PARTIES AND PERUSED THE R ECORDS AVAILABLE WITH ME ESPECIALLY THE IMPUGNED ORDER DATED 15.11 .2018 PASSED BY THE LD. CIT(A). I FIND THAT ASSESSEE FILED THE APPEAL B EFORE THE LD. CIT(A) AGAINST THE ASSESSMENT ORDER DATED 25.3.2015 PASSED U/S. 143(3)/147 OF THE I.T. ACT. THE AO HAS HELD THAT LIST OF ACCOMMO DATION ENTRIES PROVIDED BY SH. RAKESH GUPTA AND VISHESH GUPTA AND NAVNEET J AIN AND SH. VAIBHAV JAIN PERTAINING TO ASSESSMENT YEAR 2007-08 AND NOTICED THAT ENTRIES HAVE BEEN TAKEN BY THE ASSESSEE FROM SH. BA NKEY BIHARI TRADING COMPANY AMOUNTING TO RS. 4,83,821/-. THE SAID PER SONS DURING THE ASSESSMENT PROCEEDINGS U/S. 153A OF THE I.T. ACT AD MITTED THAT THEY HAVE GIVEN ACCOMMODATION ENTRIES TO THE PARTIES WHO SE LIST HAVE BEEN PROVIDED BY THEM TO THE ACIT, CIRCLES-10, NEW DEL HI. THE AO HAS REOPENED THE CASE OF THE ASSESSEE AFTER OBTAINING THE APPROVAL FROM THE COMPETENT AUTHORITY AND ADOPTED THE PRESCRIBED PRO CEDURE AS PER LAW AND MADE THE ADDITION IN DISPUTE BY HOLDING THAT AS SESSEE HAS TAKEN BOGUS PURCHASES BILL/ ACCOMMODATION ENTRIES. SINCE NO BOOKS OF ACCOUNTS WERE PRODUCED DURING THE ASSESSMENT PROCEEDINGS AND NO REPLY WAS FILED BY THE ASSESSEE IN RESPONSE TO THE SHOW CAUSE NOTIC E BY THE REVENUE AUTHORITY, HENCE, IT IS VERY CLEAR THAT ASSESSEE HA S NOTHING TO SAY IN THIS REGARD AND THE LD. CIT(A) HAS GIVEN 03 OPPORTUNITIE S TO THE ASSESSEE FOR SUBSTANTIATING THE CLAIM BEFORE, ASSESSEE REMAINED NON-COOPERATIVE AND DID NOT APPEAR BEFORE THE LD. CIT(A) AND THEREFORE, THE LD. CIT(A) HAS PASSED THE EXPARTE ORDER. UNDER THE CIRCUMSTANCES, IT IS NOT POSSIBLE FOR ME TO PASS ANY FAVOURABLE ORDER ON THE BASIS OF AN Y PRECEDENT WITHOUT 5 PROVIDING OPPORTUNITY TO THE LD. CIT(A) TO GO THROU GH THE DOCUMENTARY EVIDENCES FILED BY THE ASSESSEE AND DECIDE THE IS SUE ACCORDINGLY. IN THE INTEREST OF JUSTICE, I AM OF THE VIEW THAT THE MATT ER REQUIRES RECONSIDERATION AT THE LEVEL OF THE LD. CIT(A). AC CORDINGLY, I SET ASIDE THE ISSUES IN DISPUTE TO THE FILE OF LD. CIT(A) WIT H THE DIRECTIONS TO DECIDE THE SAME AFRESH, AFTER GIVING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. ASSESSEE IS ALSO DIRECTED TO FULLY COOPER ATE WITH THE LD. CIT(A) AND DID NOT TAKE ANY UNNECESSARY ADJOURNMENT AND FI LE ALL THE NECESSARY DOCUMENTARY EVIDENCES BEFORE HIM. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 08/11/2019. SD/- [H.S. SIDHU] JUDICIAL MEMBER DATE 08/11/2019 SRB COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES