M/s. Creative Infrapower Pvt. Ltd., New Delhi V. ITO, New Delhi

ITA 85/DEL/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 8813 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 6 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-07-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 05-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHIMA NEB SENIOR
• Assessee Lawyers: T R TALWAR
• Keywords: Opportunity of being heard; Additional evidence; TDS; Set aside
• Section: 68; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH B : NEW DELHI) BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER ITA NO.85/DEL./2017 (ASSESSMENT YEAR : 2012-13) M/S. CREATIVE INFRAPOWER PVT. LTD., VS. ITO, WARD 6 (4), G 45, 3 RD FLOOR, LAJPAT NAGAR 1, NEW DELHI. NEW DELHI 110 024. (PAN : AADCC1772B) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI T.R. TALWAR, ADVOCATE REVENUE BY : MS. ASHIMA NEB, SENIOR DR DATE OF HEARING : 08.07.2019 DATE OF ORDER : 11.07.2019 O R D E R PER KULDIP SINGH, JUDICIAL MEMBER : APPELLANT, M/S. CREATIVE INFRAPOWER PVT. LTD. (HER EINAFTER REFERRED TO AS THE ASSESSEE) BY FILING THE PRESEN T APPEAL SOUGHT TO SET ASIDE THE IMPUGNED ORDER DATED 23.06.2016 PASSE D BY THE COMMISSIONER OF INCOME-TAX (APPEALS)-2, NEW DELHI Q UA THE ASSESSMENT YEAR 2012-13 ON THE GROUNDS INTER ALIA T HAT :- 1. THAT THE ACTION ON THE PART OF CIT (A)-2 TO CO NFIRM EX- PARTE ORDER PASSED U/S 144 OF I.T. ACT BY AO IS QUI TE ILLEGAL, ARBITRARY AND UNJUST IN VIEW OF THE FACTS AND CIRCU MSTANCES OF THE CASE. ITA NO.85/DEL./2017 2 2. THAT IN THE ABSENCE OF NON SERVICE OF ANY NOTICE , THE APPELLANT COULD NOT COMPLY BECAUSE OF LOCATION OF T HE COMPANY LOCATED AT NO. G-45, III FLOOR, LAJPAT NAGAR WHERE NO POSTMAN OR SERVICE PERSONNEL LIKE TO REACH DUE TO NON AVAIL ABILITY OF LIFT, IN ADDITION TO MANAGING DIRECTOR WAS ENGAGED IN THE BU SINESS OF CIVIL CONSTRUCTION /WORK DONE IN LUCKNOW FOR A LONG PERIOD OF MORE THAN TWO YEARS. 'THE LD. AO HAS ALSO NOT GIVEN ANY COMMENT WHETHER OR NOT SERVICE OF NOTICES HAVE BEEN DONE OR NOT. THEREFORE, EX-PARTE ASSESSMENT IS QUITE ILLEGAL, UNJUSTIFIED AND ARBITRARY. ' 3. THAT THE FINDING OF THE LD. CIT(A)-2 THAT THE GE NUINENESS OF THE TRANSACTIONS IN RESPECT OF SHARE APPLICATION OF RS. 5,15,000/- COULD HAVE BEEN ESTABLISHED ONLY IF THE APPELLANT HAD PROVIDED COPY OF BANKS STATEMENTS OF TWO SHARE APPL ICANTS SHOWING SUFFICIENT BALANCES AND WITHDRAWAL BY CHEQU E ARE CONTRARY TO THE ADMISSION IN THE REMAND REPORT THAT DETAILS IN RESPECT OF SHARE APPLICATION MONEY WITH DOCUMENTARY PROOF INSPITE OF THE FACT THAT CONFIRMATION, BANKS STATEM ENTS AND ITR'S HAVE BEEN DULY SUBMITTED. THE TRANSACTIONS OF SHARE APPLICATION MONEY WERE HELD THROUGH BANK CHANNEL. BOTH THE SHAR E HOLDERS ARE DULY ASSESSED TO INCOME TAX AT THEIR RESPECTIVE PAN. 4. THAT THE LD. AO IN HIS REMAND REPORT DATED 15.10 .2015 HAS NOT EVEN A SINGLE WORD COMMENTED IN RESPECT OF EVIDENCES FILED BEFORE HIM IN RESPECT OF COPIES OF BILLS FOR EXPENDITURE DEBITED TO P & L A/C, BALANCE SHEET AND AUDIT REPOR T OVER ADHOC ADDITION OF RS.1.00 CRORE, ALLEGING UN-EXPLAINED AN D UNVERIFIED EXPENSES TO COVER UP THE POSSIBLE LEAKAGE OF REVENU E EXCEPT NECESSARY EVIDENCE TO SUBSTANTIATE ITS CLAIM. THE A O HAS FAILED TO COMMENT OF THE DETAILS OF ALL SUCH EXPENDITURE AND DULY AUDITED BALANCE SHEET FILED BEFORE HIM. 5. THAT LD. CIT(A) HAS FURTHER FAILED TO HONOUR THE JUDGMENTS BY HON'BLE SUPREME COURT OF INDIA IN THE CASES OF CIT VS. KANPUR COAL SYNDICATE 53 ITR 225 AND JUTE C ORPORATION OF INDIA VS. CIT ITR 688 TO USE POWER AS HELD GOOD IN THE CASE OF NECESSARY EVIDENCE NOT PRODUCED BEFORE AO, HOWEV ER, ALL SUCH EVIDENCES / DETAILS FILED BY WAY OF COPY OF LEDGER ACCOUNT OF GROSS RECEIPTS JOB WORK, LABOUR CHARGES SUNDRY CREDITORS, CURRENT LIABILITIES, SHORT TERM PROVISION, DIESEL & LUBRICA NTS, OPENING & CLOSING STOCK , SHORT TERM ADVANCE AND CONSUMABLE G OODS DULY AUDITED, BEFORE CIT(A) AS WELL AS AO WHO DID NOT AD MIT. 2. BRIEFLY STATED THE FACTS NECESSARY FOR ADJUDICAT ION OF THE CONTROVERSY AT HAND ARE : ASSESSING OFFICER NOTICED FROM THE ITA NO.85/DEL./2017 3 BALANCE SHEET THAT THE ASSESSEE COMPANY HAS RECEIVE D SHARE APPLICATION MONEY TO THE TUNE OF RS.5,15,000/-. AO ALSO NOTICED FROM THE PROFIT & LOSS ACCOUNT THAT THE ASSESSEE HA S CLAIMED EXPENSES OF RS.11,99,71,014/- AGAINST THE TOTAL SAL ES OF RS.12,40,05,972/-. ON FAILURE OF THE ASSESSEE TO F URNISH THE REQUISITE DETAIL BY PUTTING IN APPEARANCE DESPITE S EVERAL OPPORTUNITIES, AO PROCEEDED TO MAKE ADDITION OF RS. 5,15,000/- TO THE INCOME OF THE ASSESSEE UNDER SECTION 68 OF THE INCOME-TAX ACT, 1961 (FOR SHORT THE ACT) ON ACCOUNT OF UNEXPLAINE D CASH CREDIT. AO ALSO MADE ADDITION OF RS.1,00,00,000/- ON FAILUR E OF THE ASSESSEE TO FURNISH DETAILS OF EXPENDITURE CLAIMED, BILLS & VOUCHERS AND EVIDENCE OF TDS DEDUCTED, IF ANY, AND THEREBY A SSESSED THE TOTAL INCOME OF THE ASSESSEE AT RS.1,42,20,680/-. 3. ASSESSEE CARRIED THE MATTER BY WAY OF AN APPEAL BEFORE THE LD. CIT (A) WHO HAS CONFIRMED THE ADDITION BY DISMI SSING THE APPEAL. FEELING AGGRIEVED, THE ASSESSEE HAS COME U P BEFORE THE TRIBUNAL BY WAY OF FILING THE PRESENT APPEAL. 4. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVES OF THE PARTIES TO THE APPEAL, GONE THROUGH THE DOCUMENTS R ELIED UPON AND ORDERS PASSED BY THE REVENUE AUTHORITIES BELOW IN T HE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CASE. ITA NO.85/DEL./2017 4 5. AT THE VERY OUTSET, IT IS BROUGHT TO OUR NOTICE BY THE LD. AR FOR THE ASSESSEE THAT DURING APPELLATE PROCEEDINGS BEFORE THE LD. CIT (A), ASSESSEE HAD MOVED APPLICATION UNDER RULE 46A OF THE INCOME-TAX RULES, 1962 (FOR SHORT THE RULES) FOR BRINGING ON RECORD ADDITIONAL EVIDENCE, WHICH WAS DISMISSED BY THE LD. CIT (A) ON THE SOLE GROUND THAT AMPLE OPPORTUNITIES HAVE BE EN GIVEN TO THE ASSESSEE TO BRING ON RECORD THE RELEVANT EVIDENCE. 6. HOWEVER, LD. DR FOR THE REVENUE HAS VEHEMENTLY O PPOSED THE ARGUMENT ADDRESSED BY THE LD. AR FOR THE ASSESS EE THAT HE WAS NOT GIVEN ADEQUATE OPPORTUNITY OF BEING HEARD ON TH E GROUND THAT NUMEROUS OPPORTUNITIES HAVE ALREADY BEEN GIVEN TO T HE ASSESSEE BUT HE HAS INTENTIONALLY NOT PREFERRED TO BRING ON RECO RD THE RELEVANT EVIDENCE, IF ANY, AND PRAYED FOR DISMISSAL OF THE A PPEAL. 7. NO DOUBT IN PARA 3.4.1 OF THE IMPUGNED ORDER, LD . CIT (A) HAS RECORDED THE CHRONOLOGY OF ASSESSMENT PROCEEDIN GS WHICH TOOK PLACE BEFORE THE AO GRANTING NUMEROUS OPPORTUNITIES TO THE ASSESSEE TO PUT-FORTH HIS DEFENCE BUT THE ASSESSEE HAS NOT PREFERRED TO PUT AN APPEARANCE AND CONSEQUENTLY, HE WAS PROCE EDED EX-PARTE. HOWEVER, WE ARE OF THE CONSIDERED VIEW THAT WHEN TH E ASSESSEE HAS COME UP WITH DETAILED APPLICATION UNDER RULE 46A OF THE RULES TO BRING ON RECORD THE RELEVANT EVIDENCE, THE SAME CAN NOT BE REJECTED ITA NO.85/DEL./2017 5 BY THE LD. CIT (A) MERELY BY RELYING UPON THE FACTS PUT FORTH BY THE AO THAT THE ASSESSEE HAS INTENTIONALLY NOT PUT AN A PPEARANCE RATHER LD. CIT (A) BEING A QUASI-JUDICIAL AUTHORITY WAS RE QUIRED TO TAKE A HOLISTIC VIEW BY PROVIDING OPPORTUNITY OF BEING HEA RD TO THE ASSESSEE. EVEN OTHERWISE, TO DECIDE THE CONTROVERS Y ONCE FOR ALL AND ALSO TO STOP THE MULTIPLICITY OF THE LITIGATION , THE EVIDENCE SOUGHT TO BE LED BY THE ASSESSEE DURING APPELLATE P ROCEEDINGS IS REQUIRED TO BE ENTERTAINED. SO, WE ACCEPT THE ADDI TIONAL EVIDENCE SOUGHT TO BE BROUGHT ON RECORD BY THE ASSESSEE BY W AY OF APPLICATION UNDER RULE 46A OF THE RULES AND REMAND THE CASE BACK TO THE AO TO BE DECIDED AFRESH AFTER PROVIDING ADEQ UATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. CONSEQ UENTLY, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATIST ICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON THIS 11 TH DAY OF JULY, 2019. SD/- SD/- (R.K. PANDA) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 11 TH DAY OF JULY, 2019 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-2, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.