Himanshu Verma, Patiala V. ITO, Ward 2, Patiala

ITA 848/CHANDI/2019

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 2118 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 9 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-03-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 01-03-2021
• Assessment Year: 2008-2009
• Appeal Filed On: 29-05-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MEENAKSHI VOHRA CIT
• Assessee Lawyers: DEEPAK AGRAWAL
• Keywords: Unexplained investment; Opportunity of being heard; Additional evidence; Set aside
• Section: 80C; 145(3); 144

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BE NCH A, CHANDIGARH .., !' .. , # $% BEFORE: SHRI. N.K.SAINI, VP & SHRI , R.L. NEGI, JM ITA NO. 848/CHD/2019 ASSESSMENT YEAR : 2008-09 HIMANSHU VERMA MAIN BAZAR, GURBAX COLONY, NEAR ARYA SCHOOL, PATIALA THE ITO WARD 2 PATIALA PAN NO: ADVPV8981D APPELLANT RESPONDENT !' ASSESSEE BY : SHRI DEEPAK AGRAWAL, ADVOCATE #!' REVENUE BY : SMT. MEENAKSHI VOHRA, ADDL. CIT $ %! & DATE OF HEARING : 01/03/2021 '()*! & DATE OF PRONOUNCEMENT : 01/03/2021 $&/ ORDER PER N.K. SAINI, VICE PRESIDENT THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER D T. 04/03/2019 OF LD. CIT(A), PATIALA. 2. FOLLOWING GROUNDS HAVE BEEN RAISED IN THIS APPEAL : 1. THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN REJECTING THE BOOKS OF ACCOUNTS OF THE ASSESSEE ON THE GROUND THAT THE ASSESSEE FAILED TO GIVE CONVINCING ARGUMENT ON WHY BOOKS OF ACCOUNTS MAY NOT BE REJECTED, WHEREAS AS P ER THE ASSESSEE THE LD. CIT(A) EXCEEDED HIS JURISDICTION BY REJECTING BOOKS OF ACC OUNTS U/S 145(3) WITHOUT GIVING PRIOR NOTICE (ENHANCEMENT), THEREFORE THE ACTION OF THE L D. CIT(A) NEEDS TO BE SET ASIDE. 2. THAT THE LD. CIT(A) IS NOT JUSTIFIED IN REJECTING T HE APPEAL OF THE ASSESSEE WITHOUT GOING INTO THE MERITS OF THE CASE ON THE GROUND THA T COMPLETE SET OF BILLS AND VOUCHERS HAVE NOT BEEN PRODUCED AND THE TRANSACTIONS CANNOT BE VERIFIED WHEREAS AS PER THE ASSESSEE EACH AND EVERY TRANSACTION PERTAINING TO T HE ADDITIONS WERE DULY EXPLAINED AND WITHOUT EVEN DISCUSSING THE ADDITIONS THE APPEAL OF THE ASSESSEE WAS DISMISSED SUMMARILY WITHOUT ANY CONCRETE FINDING, THEREFORE THE ACTION OF THE LD. CIT(A) NEEDS TO BE SET ASIDE. 3. THAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ARB ITRARY ADDITION OF RS.65,63,582/- ON THE GENERAL GROUND THAT COMPLETE SET OF BILLS AN D VOUCHERS HAVE NOT BEEN PRODUCED AND THE TRANSACTIONS CANNOT BE VERIFIED WHEREAS AS PER THE ASSESSEE THE SAID DEPOSITS ARE DULY EXPLAINABLE AND ARE FROM THE KNOWN SOURCES AND ARE PART OF REGULAR BOOKS OF ACCOUNTS, THEREFORE THE ACTION OF THE LD. CIT(A) NE EDS TO BE SET ASIDE. 4. THAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ACTION OF THE LD. A.O. IN REJECTING THE CLAIM UNDER SECTION 80C MADE BY THE ASSESSEE ON THE GENERAL GROUND THAT COMPLETE SET OF BILLS AND VOUCHERS HAVE NOT BEEN PRODUCED AN D THE TRANSACTIONS CANNOT BE VERIFIED WHEREAS AS PER THE ASSESSEE THE SAID CLAIM IS DULY ADMISSIBLE BEING BACKED BY THE RECEIPTS AND OTHER EVIDENCES ISSUED BY THE COMPETENT PERSONS , THEREFORE THE ACTION OF THE LD. CIT(A) NEEDS TO BE SET ASIDE. 5. THAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ACTION OF LD. AO M MAKING AN ADDITION OF RS. 10,11,000/- TOWARDS UNEXPLAINED INV ESTMENT IN PURCHASING THE CAR BY ESTIMATING THE COST OF CAR AT RS.32,00,000/- ON THE GENERAL GROUND THAT COMPLETE SET OF BILLS AND VOUCHERS HAVE NOT BEEN PRODUCED AND THE TRANSAC TIONS CANNOT BE VERIFIED WHEREAS AS PER THE ASSESSEE THE SAID INVESTMENT MADE BY THE ASSESSEE IS DULY EXPLAINABLE BACKED BY EVIDENCE IN THE FORM OF BANK LOAN AND OTHER EXPL AINED SOURCES, THEREFORE THE ACTION OF THE LD. CIT(A) NEEDS TO BE SET ASIDE. 6. THAT THE ASSESSEE PRAYS FOR ANY CONSEQUENTIAL RELIE F AND/OR LEGAL CLAIM ARISING OUT OF THIS APPEAL BEFORE THE DISPOSAL OF THE SAME. 7. THAT THE ASSESSEE PRAYS FOR ANY ADDITION, DELETION, AMENDMENT AND MODIFICATION IN THE GROUNDS OF APPEAL BEFORE THE DISPOSAL OF THE SAME IN THE INTEREST OF SUBSTANTIAL JUSTICE TO THE ASSESSEE. 3. FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESSEE FI LED THE RETURN OF INCOME ON 12/11/2008 DECLARING AN INCOME OF RS. 3,85,012/-. HOWE VER THE A.O. FRAMED THE ASSESSMENT EXPARTE UNDER SECTION 144 OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS ACT) AND MADE THE ADDITION OF RS. 65,63,582/- ON ACCOUNT OF UNEXPLAINED DEPOSIT IN BANK ACCOUNT AND RS. 10,11,000/- ON ACCOUNT OF UNEXPLAINED INVESTMENT IN PURCHASE OF THE CAR. ACCORDINGLY THE INCOME WAS ASSES SED AT RS. 79,59,590/-. AGAINST THE ORDER PASSED BY THE A.O., THE ASSESSEE PREFERRED A N APPEAL BEFORE THE LD. CIT(A) WHO SUSTAINED THE ADDITIONS. THEREAFTER, THE ASSESSEE F ILED AN APPEAL BEFORE THE ITAT IN ITA NO. 1117/CHD/2013 WHEREIN VIDE ORDER DT. 30/10/20 14 THE ITAT CHANDIGARH BENCH HAS RESTORED THE MATTER BACK TO THE FILE OF THE LD. CIT (A) BY DIRECTING AS UNDER: 'AFTER CONSIDERING THE RIVAL SUBMISSIONS WE FIND TH AT THREE ADJOURNMENTS WERE SOUGHT BY THE LD. COUNSEL FOR THE ASSESSEE FROM THE OFFICE OF THE LD. CIT(A) WHICH WERE GRANTED. ON THE LAST DATE NONE APPEARED. IN THESE CIRCUMSTANCES, NO DOUBT THE LD. CIT(A) HAD THE RIGHT TO ADJUDICATE THE CASE AFTER CONSIDERING THE MATERIAL ON RECORD AND RECORD HIS FINDINGS. INSTEAD OF DOING SO THE LD. CU(A) HAS DISMISSED THE APPEAL IN LIMINE. THEREFORE, IN THE INTEREST OF JUSTICE WE SET ASIDE HIS ORDER AND REST ORE THE MATTER BACK TO HIS FILE WITH A DIRECTION TO ADJUDICATE THE ISSUES AFTER PROVIDING ADEQUATE OPPORTUNITY TO THE ASSESSEE. THE ASSESSEE IS ALSO DIRECTED TO COOPERATE IN THE A PPEAL PROCEEDINGS. 4. ON THE DIRECTION OF THE ITAT, THE LD. CIT(A) PASSED T HE IMPUGNED ORDER AND SUSTAINED THE ADDITION BY OBSERVING IN PARA 5.6 OF THE O RDER AS UNDER: THAT THERE IS NO REX-JUDICATA IN INCOME TAX PROCEEDINGS IS AN ACCEPTED VIEW MOREO VER, IN THE PROCEEDINGS FOR THE AY OF THE IMPUGNED ASSESSME NT YEAR, THE APPELLANT HAS DEFAULTED A NUMBER OF TIMES AND THE CONDUCT OF THE APPELLANT DOES NOT INSPIRE CONFIDENCE. DURING ORIGINAL ASSESSMENT AND DURING THE PROCEEDINGS BEFO RE ME COMPLETE SET OF BILLS AND VOUCHERS HAVE NOT BEEN PRODUCED AND THE LINKING OF THE TRANSACTION TO THE BOOK ENTRIES CANNOT BE VERIFIED. IT IS MY CONSIDERED VIEW THAT G IVEN THE ENTIRE FACTUAL MATRIX, AND THE CONDUCT OF THE APPELLANT, THE ORDER OF THE LD. A.O. DOES NOT REQUIRE ANY INTERFERENCE. IT IS ORDERED ACCORDINGLY. ALL GROUNDS OF APPEAL ARE DISMISSED. 5. NOW THE ASSESSEE IS IN APPEAL. 6. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE LD. CIT(A) DID NOT FOLLOW THE DIRECTIONS GIVEN BY THE ITAT CHANDIGARH BENCH VIDE ORDER D T. 30/10/2014 AND PARTICULARLY THE GROUND NOS. 5 TO 8 WERE NOT ADJUDICAT ED, THEREFORE THE MATER MAY BE SET ASIDE TO THE LD. CIT(A) TO PASS THE SPEAKING ORDE R. 7. IN HER RIVAL SUBMISSIONS THE LD. SR. DR STRONGLY S UPPORTED THE IMPUGNED ORDER PASSED BY THE LD. CIT(A) AND REFERRED TO PARA 4.3 OF THE SAID ORDER WHICH READS AS UNDER; 4.3 THEREAFTER THE UNDERSIGNED POSTED THE CASE ON 2 0 TH FEBRUARY 2019 AND ASKED THE APPELLANT TO APPEAR WITH ALL THE BOOKS OF ACCOUNTS BILLS AND VOUCHERS AND OTHER DETAILS WHICH THE LD AO HAS CLAIMED IN THE REMAND REPORT AR E TEST CHECKED. WHILE THE APPELLANT APPEARED WITH ALL THE BOOKS; HE SUBMITTED THAT DUE TO THE PASSAGE OF TIME AS THE MATTERS PERTAINED TO F.Y. 2007-08, THE ENTIRE VOUCHERS COUL D NOT BE PRODUCED. THE UNDERSIGNED EXAMINED THE VOUCHERS PRODUCED AND TEST CHECKED THE SE. THE VOUCHERS WERE CLEARLY NOT COMPLETE. THE LD. AR WAS ASKED VIDE NOT SHEET NOTIN G AS TO WHY, WITHOUT PREJUDICE TO THE ACCEPTANCE OF ADDITIONAL EVIDENCE, THE BOOKS OF ACC OUNTS SO PRODUCED SHOULD NOT BE REJECTED U/S 145(3) OF THE ACT. THE LD AR HAD NOTHI NG TO SAY ON THE SAME. LD. SR. DR SUBMITTED THAT THE ASSESSEE DID NOT PRODUC E THE VOUCHERS, THEREFORE THERE WAS NO ALTERNATIVE EXCEPT TO MAKE THE ADDITIONS A ND THE LD. CIT(A) RIGHTLY CONFIRMED THE SAME. 8. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIE S AND GONE THROUGH THE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT CASE I T IS AN ADMITTED FACT THAT THE ITAT VIDE ORDER DT. 30/10/2014 DIRECTED THE LD. CIT(A) T O ADJUDICATE THE ISSUES AGITATED BY THE ASSESSEE AFTER PROVIDING ADEQUATE OPPORTUNITY OF B EING HEARD. HOWEVER THE LD. CIT(A) SUSTAINED THE ADDITIONS MADE BY THE A.O. BY PAS SING THE IMPUGNED ORDER IN SLIP- SHOD MANNER. HE SIMPLY STATED THAT THE ASSESSEE COULD NOR FURNISH THE COMPLETE SET OF BILLS AND VOUCHERS AND THE LINKING OF THE TRANSACTIONS TO THE BOOKS ENTRIES COULD NOT BE VERIFIED. HOWEVER, IT IS NOT BROUGHT ON RECORD HOW AND IN WHAT MANNER THE TRANSACTIONS TO THE BOOK ENTRIES WERE NOT LINKED. THE LD.CIT(A) ALSO DID NOT DISPOSE OFF THE LEGAL ISSUE AGITATED BY THE ASSESSEE AGAINST THE COMPLETION OF THE ASSESSMENT UNDER SECTION 144 OF THE ACT. IN OTHER WORDS THE DIRECTIONS GIVEN BY THE I TAT CHANDIGARH BENCH B CHANDIGARH WERE NOT FOLLOWED PROPERLY, WE, THEREFORE DE EM IT APPROPRIATE TO SET ASIDE THIS CASE BACK TO THE FILE OF THE LD. CIT(A) TO BE A DJUDICATED AFRESH IN ACCORDANCE WITH LAW AFTER PROVIDING DUE AND REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE LD. CIT(A) IS ALSO DIRECTED TO PASS THE SPEAKING ORDER. WE ALSO DIRECT THE ASSESSEE TO COOPERATE AND NOT TO SEEK UNDUE & UNWARRANTE D ADJOURNMENTS. 9. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FO R STATISTICAL PURPOSES. (ORDER PRONOUNCED IN THE OPEN COURT ON 01/03/2021 ) SD/- SD/- .. .., (R.L. NEGI ) ( N.K. SAIN I) # $%/ JUDICIAL MEMBER / VICE PRESIDENT AG DATE: 01/03/2021 (+! ,-.- COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. $ / CIT 4. $ / 01 THE CIT(A) 5. -2 45&456789 DR, ITAT, CHANDIGARH 6. 8:% GUARD FILE (+ $ BY ORDER, ; # ASSISTANT REGISTRAR