Smt. Josephine Nirmala Raj, CHENNAI V. ITO, CHENNAI

ITA 843/CHNY/2012

• Counselvise Citation: 84321714 RSA 2012
• Duration Of Justice: 5 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-10-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 11-10-2012
• Assessment Year: 2008-2009
• Appeal Filed On: 17-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIRUDH RAI
• Assessee Lawyers: T BANUSEKHAR
• Keywords: Principle of natural justice

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D B ENCH C HENN AI BEFORE SHRI ABRAHAM P GEORGE, ACCOUNTANT MEMBER AND SHRI S.S.GODARA , JUDICIAL MEMBER .. ITA NO. 843 /MDS./ 20 12 ASSESSMENT YEAR: 200 8 - 09 MRS.JOSEPHINE NIRMALA RAJ, 104,MAURYA ENCLAVE NO.1, THIRD AVENUE, ASHOK NAGAR, CHENNAI 600 083. VS. THE INCOME - TAX OFFICER, SALARY WARD IV(4), CHENNAI. PAN AHJPJ 4788 L (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI T.BANUSEKHAR C.A RESPONDENT BY : SHRI ANIRUDH RAI CIT,DR DATE OF HEARING : 11 . 1 0.12 DATE OF PRONOUNCEMENT : 11 . 1 0.12 O R D E R PER ABRAHAM P GEORGE, ACCOUNTANT MEMBER : IN THIS APPEAL FILED BY ASSESSEE , ITS GRIEVANCE IS THAT THE CIT(A) DISMISSED THE APP EAL OF ASSESSEE WITHOUT GIVING ADEQUATE OPPORTUNITY OF HEARING AND CONFIRMED THE ADDITION S OF ` 5,75,000/ - , ` 7,70,000/ - , ` 8,55,000/ - AND ` 26,03,595/ - . ITA . 843 /MDS/ 12 2 2. SHORT FACTS APROPOS ARE THAT ASSESSEE HAD FILED RETURN OF INCOME FOR ASSESSMENT YEAR 2008 - 09 DECLARI NG A TOTAL INCOME OF ` 4,09,406/ - BESIDES AN AGRICULTURAL INCOME OF ` 6,49,000/ - . DURING THE COURSE OF ASSESSMENT PROCEEDINGS BASED ON AIR INFORMATION, ASSESSEE WAS REQUIRED TO EXPLAIN SOURCE OF CASH DEPOSITS OF ` 14,80,000/ - . AS PER ASSESSING OFFICER, ASSES SEE FILED CONFIRMATION LETTERS FOR ` 50,000/ - RECEIVED FROM MR.MANOJ ANNADURAI, FOR ` 3,00,000/ - F ROM MRS.FLORA MANGALANATHAN, FOR OF ` 2,00,000/ - FROM MRS. THERESA JOSEPH AND FOR ` 75,000/ - FROM MR.K.ASWATHAMAN. BALANCE AMOUNT OF RS.8,55,000/ - WAS EXPLAI NED AS COMING OUT OF AGRICULTURAL INCOME. 3. ASSESSING OFFICER REFUSED TO ACCEPT THE CONFIRMATION LETTERS BUT FOR RS.50,000/ - RECEIVED FROM MR.MANOJ ANNADURAI . ACCORDING TO HIM, NONE OF THE OTHER PARTIES WERE ASSESSED TO INCOME TAX. THE CLAIM OF ` 8,55,0 00/ - AS AGRICULTURAL INCOME, WAS ALSO NOT ACCEPTED , SINCE ASSESSING OFFICER WAS OF THE OPINION THAT THE ASSESSEE WAS UNABLE TO GIVE BOUGHT NOTES, PURC HASE VOUCHERS AND DETAILS OF SUCH AGRICULTURAL INCOME. IT IS TO BE NOTED THAT AGRICULTURAL INCOME SHOWN BY THE ASSESSEE IN THE PRECEDING ASSESSMENT YEAR WAS ` 5 LAKHS ONLY. ITA . 843 /MDS/ 12 3 4 . ASSESSEE IT SEEMS HAD DEPOSITS OF ` 33,73,595/ - IN HER ACCOUNT . ASSESSING OFFICER WAS OF THE OPINION THAT ASSESSEE S EXPLANATION FOR SUCH DEPOSITS COULD NOT BE ACCEPTED . AS PER ASSE SSING OFFICER , THOUGH ASSESSEE HAD FILED CONFIRMATION LETTER FOR A SUM OF ` 7,70,000/ - AS RECEIVED FROM ONE MRS.ALPHONSE JOSEPH, N OTHING WAS FURNISHED IN SUPPORT . HE THEREFORE, CONSIDERED THE SUM OF ` 33,73,595/ - ALSO AS UNEXPLAINED. 5. ASSESSEE MOV ED IN APPEAL BEFORE THE CIT(A) AGAINST THE ADDITION . ARGUMENT OF THE ASSESSEE WAS THAT ASSESSING OFFICER DID NOT TAKE NOTE OF CONFIRMATION LETTERS WHILE MAKING THE ADDITION OF ` 5,75 ,000/ - . AS PER ASSESSEE, SHE HAD RECEIVED MONEY FROM PARTIES INCLUDING HE R RELATIVES . ASSESSING OFFICER HAD RE JECTED THE CONFIRMATION LETTERS WITHOUT ANY REASON AND MADE THE ADDITION. 6 . AS FOR THE ADDITION OF ` 8,55,000/ - , ARGUMENT OF THE ASSESSEE BEFORE THE CIT(A) WAS THAT SHE OWNED 40 ACRES OF AGRICULTURAL LAND IN MUTHURAPU THUR AND HAD GUAVA , MANGO TREES, AND OTHER PLANTS CULTIVATED THEREIN . AS PER THE ASSESSEE, SCIENTIFIC FARMING WAS DONE THERE AND ASSESSING OFFICER HAD REJECTED THE CLAIM OF AGRICULTURAL INCOME WITHOUT PROPERLY APPRECIATING THE FACTS. ITA . 843 /MDS/ 12 4 7 . FOR THE ADD ITION OF ` 33,73,595/ - , IT SEEMS IN THE GR OUNDS RAISED BEFORE THE CIT(A), A SSESSEE ASSAILED ONLY ` 26,03,595/ - . AS PER ASSESSEE, THESE RECEIPTS WERE ALL VIDE DEMAND DRAFTS AND SUCH DEPOSITS HAD COME OUT OF S A LE OF TREES IN THE LAND OWNED BY HER. 8 . HOWEVER, THE CI T(A) WAS NOT APPRECIATIVE OF THE S E CONTENTION S . ACCORDING TO HIM, ASSESSEE COULD NOT DISCHARGE THE ONUS ON IT, TO PROVE THE CREDITS IN THE BOOKS . E XCEPT FOR PRODUCING CONFIRMATION LETTERS , N OTHING WAS DONE BY THE ASSESSEE. AS PER CIT(A), ONLY ONE O F THE CREDITORS WAS HAVING PA NUMBER . ASSESSEE ALSO COULD NOT SUBSTANTIATE ITS CLAIM THAT SHE OWNED 40 ACRES OF AGRICULTURAL LAND, WHICH HAD ANY CROPS RAISED THEREIN. NO MATERIALS WERE PLACED BY THE ASSESSEE TO SHOW RECEIPT OF AGRICULTURAL INCOM E. AS FO R THE ADDITION OF ` 26,03,595/ - , ASSESSEE NEITHER OFFERED A PROPER EXPLANATION NOR DETAILS OF T HE PERSONS FROM WHOM THE AMOUNT S WERE RECEIVED. I N THIS VIEW OF THE MAT TER, CIT(A) CONFIRMED THE ORDER OF THE ASSESSING OFFICER. ITA . 843 /MDS/ 12 5 9 . NOW BEFORE US, LD . A.R ASSAILING THE ORDER OF THE CIT(A) SUBMITTED THAT IN THE FIRST PLACE, NONE OF THE LOWER AUTHORITIES HAD GIVEN A PROPER OPPORTUNITY TO T HE ASSESSEE FOR REPRESENTING HER CASE . A.R. FURTHER SUBMITTED THAT ASSESSING OFFICER HAD GIVEN ONLY THREE EFFECTIV E OPPORTUNITIES AND NEVER REQUIRED THE ASSESSEE TO PRODUCE CREDITORS PERSONALLY. ACCORDING TO HIM, TWO AMONG THE CREDITORS WERE HER SISTERS AND ONE WAS HER MOTHER. ALL THESE PERSONS COULD HAVE BEEN PRODUCED BEFORE THE ASSESSING OFFICER . THEY WERE ALL HAVING SUFFICIENT SOURCE TO PROVE THEIR CREDIT WORTHINESS . IN SO FAR AS, AGRICULTURAL INCOME WAS CONCERNED, A.R. SUBMITTED THAT ASSESSEE WAS HAVING ABOUT 40 ACRES OF LAND AND THEREFORE TO PRESUME THAT SHE WOULD NOT HAVE RECEIVED A SUM OF ` 8,5 5,000/ - AS AGRICULTURAL INCOME , FROM SUCH A HOLDING WAS UNFAIR. IN ANY CASE, ACCORDING TO HIM, OPPORTUNITY WAS NOT GIVEN TO THE ASSESSEE FOR PRODUCING EVIDENCE IN THIS REGARD. AS FO R THE ADDITION MADE FOR DEPOSITS IN THE BANK, LD. A.R. SUBMITTED THAT ON CE THES E WERE CONSIDERED CHEQUE OR DEMAND DRAFTS , IT WAS CLEAR THAT THERE WAS IDENTIFIABLE SOURCE AVAILABLE AND HAD THE ASSES SEE BEEN GIVEN PROPER OPPORTUNITY, SHE WOULD HAVE PRODUCED SUPPORTIVE RECORDS. ITA . 843 /MDS/ 12 6 10 . LD A.R. ALSO PLEADED FOR ADMISSION OF ADDITIONAL EVID ENCE, WHICH ACCORDING TO HIM, WOULD PROVE THAT THE SOURCE FOR EACH OF THE AMOUNTS WAS THERE . ACCOR D I NG TO HIM, ASSES SEE WAS HAVING COPY OF ADANGAL, COPY OF LAND REVENUE TAX PAYMENTS, COPY OF CERTIFICATES FOR YIELD AND ALSO INFORMATION RECEIVED FROM HER B ANKER WITH REGARD TO DEPOSITS IN HER ACCOUNT . IF THE SE WE RE NOT CONSIDERED , IT WOULD RESULT IN MISCARRIAGE OF JUSTICE, SINCE INCOME, WHICH WA S NOT THAT OF ASSESSEE, WOULD GET ASSESSED IN HER HANDS. LD. A.R. POINTED OUT THAT ASSESSEE WAS A WIDOW SUFFERI NG FROM SEVERE BACK PAIN AND WAS UNABLE TO TAKE CARE OF HER AFFAIRS PROPERLY . SHE COULD NOT PRESENT HER CASE BEFORE THE LD. CIT(A) IN A PROPER MANNER. 11 . PER CONTRA LD. D.R. STRONGLY SUPPORTING THE ORDERS OF THE LOWER AUTHORITIES SUBMITTED THAT ASSESS EE WAS GIVEN MORE THAN ENOUGH OPPORTUNITY BY ASSESSING OFFICER AS WELL AS CIT(A). ACCORDING TO HIM, ONCE CREDIT S WERE SHOWN, ONUS WAS ON THE ASSESSEE TO P ROVE FROM WHERE THE CREDITS HAD COME. ASSESSEE HAD NOT DISCHARGED THE ONUS RESTING ON HER TO SHOW T HE GENUINENESS OF THE CREDIT AND CREDIT WORTHINESS OF THE CREDITORS. ASSESSEE DID NOT PRODUCE ANY DOCUMENTS BEFORE THE LOWER AUTHORITIES TO SHOW THAT SHE WAS HOLDING ANY AGRICULTURAL LAND. IN ITA . 843 /MDS/ 12 7 ANY CASE, ACCORDING TO HIM, ASSESSEE DID NOT RAISE ANY GRIEVAN CE BEFORE THE CIT(A) FOR THE ADDITION OF ` 7,70,000/ - OUT OF THE TOTAL DEPOSIT OF ` 33,73,595/ - . ACCORDING TO HIM, ASSESSEE HAVING F A ILED TO SUBSTANTIATE ITS CASE BEFORE THE LOWER AUTHORITIES, COULD NO T BE GIVEN ANOTHER OPPORTUNITY, NOR COULD BE ALLOWED N OW TO PRODUCE FURTHER EVIDENCE. 12 . WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE ORDERS OF THE AUTHORITIES BELOW. A L OOK AT THE ASSESSMENT ORDER SHOW S THAT ASSESSING OFFICER HAD MADE FOUR ADDITIO NS. TWO OF THESE ADDITIONS WERE AGAINST CASH DEPO SIT OF ` 14,80,000/ - . THIS AMOUNT OF ` 14,80,000/ - CAN BE SP L I T INTO TWO. FIRST I S AN AMOUNT ` 6,25 ,000/ - ,FOR WHICH A SSESSEE HAD PLACED CERTAIN CONFIRMATION LETTERS BEFORE THE LOWER AUTHORITIES, WHICH WERE NOT ACCEPTED , EXCEPT FOR A SUM OF ` 50,000/ - . I N OTHER WORDS ` 5,75,000/ - OUT OF ` 6,25,000/ - WAS TAXED AS UNEXPLAINED. SECOND IS THE SUM OF ` 8,55,000/ - WHICH ASSESSEE EXPLAINED AS COMING OUT OF AGRICULTURAL INCOME BUT AGAIN NOT ACCEPTED. ITA . 843 /MDS/ 12 8 13 . THE OTHER TWO ADDITIONS TOTALING TO ` 33,70,595/ - ALS O COMPRISED O F TWO PARTS. FIRST WAS ` 7,70,000/ - FOR WHICH ASSESSEE HAD FILED A CONFIRMATION LETTER FROM MRS. ALPHONSE JOSEPH, BUT WAS NOT ACCEPTED. SECOND WAS DEPOSIT S OF ` 26,03,595/ - FOR WHICH , AS PER THE ASSESSING OFFICER THERE WAS NO PROPER EXPLANAT ION. 14 . ARGUMENT OF THE ASSESS EE IS THAT THE CREDITORS BEING TWO OF HER SISTER S AND MOTHER COULD HAVE BEEN PRODUCED BEFORE THE ASSESSING OFFICER , IF HE REQUIRED SO. AGAIN AS PER THE ASSESSEE, SHE WAS HAVING EVIDENCE TO PROVE AGRICULTURAL INCOME ALS O. FURTHER ACCORDING TO THE ASSESSEE , ASSESSING OFFICER HAD NOT GIVEN SUFFICIENT OPPO RTUNITY FOR EXPLAINING THE CRED IT S . WE FIND THAT ASSESSING OFFICER HAD GIVEN FOUR OPPORTUNITIES TO THE ASSESSEE ON 20.10.09, 29.11.10, 08.12.10 & 16.12.10. OBVIOUSLY AS SESSMENT WAS EARNESTLY TAKEN UP ONLY ON 21.11.10 AND IT WAS COMPLETED WITHIN A TIME PERIOD OF 16 DAYS. AS AGAINST THIS, LD.CIT(A), IN THE APPEAL PROCEEDINGS, HAD GIVEN ONLY TWO OPPORTUNITIES , ONE ON 21.11.11 AND SECOND ON 03.01.12. A DMITTEDLY TH ERE WAS NO REPRESENTATION EITHER BY THE ASSESSEE OR HER REPRESENTATIVE BEFORE THE CIT(A). ASSESSING OFFICER HIMSELF APPEARS TO BE CONFUSED . THOUGH HE STATES AT PARA 1 OF HIS ORDER ITA . 843 /MDS/ 12 9 ABOUT A CASH DEPOSIT OF ` 14,80,000/ - , NOTHING WHATSOEVER IS MENTIONE D REGARDING THE BANK ACCOUNT TO WHICH THE DEPOSITS WERE MADE. N OR ANY BANK DETAILS ARE AVAILABLE . AGAIN AT PARA - 3 OF THE ASSESSMENT ORDER, HE MENTIONS A CASH DEPOSIT OF ` 33,73,595/ - . N EVERTHELESS IN SUBSEQUENT PARAS, HE SAYS ALL WERE CHEQUE DEPOSITS . T HUS, IT IS CONFUSION GALORE IN THE ASSESSMENT ORDER WITH REGARD TO THE NATURE OF DEPOSITS MADE BY THE ASSESSEE. IF THE ASSESSE E IS HAVING SUFFICIENT AGRICUL TURAL INCOME AND EXPLAINABLE SOURCE FOR THE CREDIT S IN HER BANK ACCOUNT , AND THE CREDITORS A RE GENU INE, IT WILL NOT BE FAIR TO TAX THE ASSESSEE ON SUCH AMOUNTS. IN THE FACE OF THESE FACTS, IN OUR OPINION, NATURAL JUSTICE DEMAND THAT ASSESSEE BE GIVEN ONE MORE OPPORTUNITY FOR BRINGING ON RECORD THE SOURCE FOR HER DEPOSITS. WE ARE THEREFORE OF THE OPI NION THAT THE MATTER REQUIRES A REVISIT BY THE ASSESSING OFFICER FOR CONSIDERATION AFRESH. WE THEREFORE, SET ASIDE THE ORDERS OF THE AUTHORITIES AND REMIT ALL THE ISSUES BACK TO THE ASSESSING OFFICER FOR CONSIDERATION OF AFRESH , IN ACCORDANCE WITH LAW. NE EDLESS TO SAY ASSESSEE HAS TO BE GIVEN AN OPPORTUNITY TO EXPLAIN HER CASE. ITA . 843 /MDS/ 12 10 15 . IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT AF TER CONCLUSION OF HEARING ON THURSDAY, THE 11 TH OCTOB ER, 2012. SD/ - SD/ - ( S.S.GODARA ) ( ABRAHAM P GEORGE ) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED 11 TH OCTOBER , 2012 . K S SUNDARAM COPY TO: ASSESSEE / AO / CIT (A) / CIT / D.R. / GUARD FILE ITA . 843 /MDS/ 12 11