Sh. Mewa Singh, Jind V. Pr.CIT, Rohtak

ITA 88/CHANDI/2021

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 2708 (ITAT-CHANDIGARH)
• Duration Of Justice: 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-10-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 12-05-2021
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SANDEEP DAHIYA
• Keywords: Revision of order; Difference of opinion; Assessment record; Set aside
• Section: 143(3); 147; 263

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH B CHANDIGARH !,'#$ ,$ % & ' ( ) , *+# BEFORE: SMT. DIVA SINGH, JM & SMT.ANNAPURNA GUPTA, AM ./ ITA NO. 88/CHD/2021 / ASSESSMENT YEAR : 2011-12 SHRI MEWA SINGH, HOUSE NO. 1300, URBAN ESTATE, JIND. VERSUS THE PR. CIT, ROHTAK. ./ PAN NO: ACOPS1643R / APPELLANT / RESPONDENT (VIRTUAL COURT) / ASSESSEE BY : SHRI NIKHIL GOYAL, CA & SHRI ASHOK GOYAL, CA ! / REVENUE BY : SHRI SANDEEP DAHIYA, CIT ' # $/ DATE OF HEARING : 30.09.2021 %&'( $/ DATE OF PRONOUNCEMENT : 27.10.2021 / ORDER PER ANNAPURNA GUPTA, ACCOUNTANT MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSESS EE AGAINST THE ORDER PASSED BY THE PRINCIPAL COMMISSIO NER OF INCOME TAX (PCIT ) DATED 23.03.2021 U/S 263 OF THE INCOME TAX ACT, 1961(IN SHORT REFERRED TO AS ACT), IN EXERCI SE OF HIS REVISIONARY JURISDICTION. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS : ITA -88/CHD/2021 A.Y. 2011-12 PAGE 2 OF 10 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT HAS EXCEEDED LEGISLATIVE JURISDICTION U/S 263 O F THE INCOME TAX ACT, 1961 THUS THE ORDER PASSED BY THE LD. CIT IS BAD IN THE EYES OF THE LAW. 2. THAT THE LD. CIT HAS ERRED IN PASSING ORDER U/S 263 OF THE INCOME TAX ACT, 1961 IN THE ABSENCE OF ANY ERRONEOUS POSITION PREJUDICIAL TO THE INTEREST OF REVENUE IN THE ORIGINAL ASSESSMENT ORDER PASSED BY THE LD. AO U/S 143(3) READ WITH SECTION 147 OF THE INCOME TAX ACT, 1961. 3. THAT THE LD. CIT HAS ERRED IN CONCLUDING PROCEED INGS U/S 263 OF THE INCOME TAX ACT, 1961 WITHOUT PROPER PERUSAL OF THE ASSESSMENT RECORD. 4. THAT THE LD. CIT HAS ERRED IN SUBSTITUTING AN AL TERNATIVE VIEW AS AGAINST THE FIRM VIEW ADOPTED BY THE LD. AO AT THE TIME OF ORIGINAL ASSESSMENT U/S 143(3) READ WITH SECTION 147 OF THE INCOME TAX ACT, 1961. 5. THAT THE APPELLANT CRAVES LEAVE TO ADD OR AMEND THE GROUNDS OF APPEAL BEFORE THE APPEAL IS FINALLY HEARD OR DISPOSED OFF. 3. DURING THE COURSE OF HEARING BEFORE US, LD. COUN SEL FOR THE ASSESSEE AT THE OUTSET ITSELF STATED THAT HE WAS PR ESSING ONLY GROUND NO. 1 AND 2. THEREAFTER, HE DREW OUR ATTENT ION TO THE FACTS OF THE CASE FROM PARA 3 AT PAGE 3 OF THE ORD ER OF THE LD. PCIT POINTING OUT THEREFROM THAT DURING ASSESSMENT PROCEEDINGS THE ASSESSEE HAD JUSTIFIED CASH DEPOSIT ED IN HIS BANK ACCOUNT AMOUNTING TO RS. 10,15,000/- BY STATIN G THAT HE HAD RECEIVED RS. 9,50,000/- IN CASH FROM ONE SHRI P RADEEP SINGH AS CONSIDERATION FOR LEASING AGRICULTURAL LAN D OF 3 ACRES TO HIM FOR 10 YEARS. AFFIDAVIT TO THIS EFFECT OF S HRI PRADEEP SINGH WAS ALSO FILED. THIS EXPLANATION OF THE ASSE SSEE WAS ACCEPTED BY THE ASSESSING OFFICER (AO).IT WAS THIS ACCEPTANCE BY THE AO, WHICH WAS FOUND BY LD. PCIT TO BE ERRONE OUS SO AS TO CAUSE PREJUDICE TO THE REVENUE, FOR THE REASON T HAT THE AO ITA -88/CHD/2021 A.Y. 2011-12 PAGE 3 OF 10 SIMPLY ACCEPTED THE EXPLANATION OF THE ASSESSEE WIT HOUT CONDUCTING ANY FURTHER ENQUIRY ON THE ISSUE. THE L D. COUNSEL FOR THE ASSESSEE THEREAFTER TOOK US TO THE ASSESSME NT ORDER AND DRAWING OUR ATTENTION TO THE SAME, HE STATED THAT T HE ASSESSEE'S CASE HAD BEEN REOPENED U/S 147 OF THE AC T, SPECIFICALLY FOR THE PURPOSE OF EXAMINING THIS CASH DEPOSIT WHICH THE AO HAD DULY DONE. HE POINTED OUT THAT AFT ER CONFRONTING THE ASSESSEE WITH THE ISSUE OF SOURCE O F CASH DEPOSIT, A DETAILED REPLY WAS FILED BY THE ASSESSEE EXPLAINING THE SOURCE, AS BEING OUT OF HIS PAST SAVINGS, AGRIC ULTURAL INCOME AND AMOUNT RECEIVED FROM SHRI PRADEEP SINGH, WHICH WAS SUPPORTED BY AN AFFIDAVIT FROM HIM. THE AO HAD, AFTER CONSIDERING THE SAME, ACCEPTED THE EXPLANATION OF T HE ASSESSEE. HE ALSO DREW OUR ATTENTION TO THE FINDINGS OF THE A O TO THE EFFECT THAT REGARDING THE GENUINENESS OF THE FACTS MENTIONED IN THE AFFIDAVIT NECESSARY VERIFICATION HAD BEEN MADE AND THAT THE ASSESSEE HAD SUBMITTED CASH FLOW STATEMENT EXPLAINI NG EVERY SINGLE DEBIT ENTRY IN DETAIL IN THE SAME ALONGWITH RELEVANT SUPPORTING DOCUMENTS. THE LD. COUNSEL FOR THE ASSES SEE THEREAFTER CONTENDED THAT IT IS EVIDENT FROM THE SA ME THAT IT IS NOT A CASE OF LACK OF INQUIRY AT ALL AND THEREFORE, THE LD. PCITS EXERCISE OF REVISIONARY JURISDICTION IN THESE FACTS AND CIRCUMSTANCES WAS NOT IN ACCORDANCE WITH LAW. HE R ELIED UPON ITA -88/CHD/2021 A.Y. 2011-12 PAGE 4 OF 10 VARIOUS DECISIONS OF THE CO-ORDINATE BENCH IN THIS REGARD AS UNDER : I) JEEWAN KUMAR V PCIT, BATHINDA (2017) 82 TAXMANN.COM 221 (AMRITSAR-TRIB) II) NARAIN SINGLA V PCIT, CENTRAL, LUDHIANA (2015) 62 TAXMANN.COM 255 (CHANDIGARH -TRIB) III) PAWAN KUMAR V CIT, KARNAL (2015) 62 TAXMANN.CO M 260 (CHANDIGARH -TRIB) 4. REFERRING TO THE ABOVE CASE LAWS, HE POINTED OUT THAT THE TRIBUNAL HAD REPEATEDLY HELD THAT WHERE THERE WAS I NQUIRY, EVEN INADEQUATE, THAT WOULD NOT BY ITSELF GIVE OCCA SION TO THE COMMISSIONER TO PASS ORDER U/S 263 MERELY BECAUSE H E HAD A DIFFERENT OPINION IN THE MATTER. THAT IT IS ONLY I N THE CASE OF LACK OF ENQUIRY THAT SUCH A CAUSE OF ACTION CAN BE RESORTED TO. 5. THE LD. DR COUNTERED BY STATING THAT THE LD. PCI T HAD INFACT MADE OUT A CASE OF NO ENQUIRY AT ALL. HE CON TENDED THAT THE CASE OF THE LD.PR.CIT WAS THAT THE DOCUMENTS SU BMITTED BY THE ASSESSEE DURING ASSESSMENT PROCEEDINGS, IN SUPP ORT OF HIS EXPLANATION OF SOURCE OF CASH DEPOSIT, REFLECTED MA JOR CONTRADICTION OF FACT, WHICH SHOULD HAVE PROMPTED T HE AO TO CONDUCT FURTHER INQUIRY AND VERIFICATION, BUT THE A O HAD SIMPLY ACCEPTED THE EXPLANATION OF THE ASSESSEE MAKING NO INQUIRIES AT ALL. REFERRING TO THE AFFIDAVIT OF SHRI PRADEEP SIN GH AND THE NAKAL JAMABANDI OF THE LAND SOLD, FILED BY THE AS SESSEE, HE POINTED OUT THAT THE CONTENTS OF BOTH WERE CONTRAD ICTORY. HE ITA -88/CHD/2021 A.Y. 2011-12 PAGE 5 OF 10 DREW OUR ATTENTION TO PARA 3 OF THE ORDER OF THE PC IT WHEREIN HE HAD BROUGHT OUT THIS DISCREPANCY, NOTING THAT WH ILE THE AFFIDAVIT STATED THAT THE ASSESSEE'S LAND AS BEING LEASED OUT TO SHRI PRADEEP SINGH, THE NAKAL JAMABANDI STILL SHO WED THE ASSESSEE AS CULTIVATOR OF HIS AGRICULTURAL LAND FOR THE SAID PERIOD. THE RELEVANT FINDINGS AT PARA 3, TO WHICH O UR ATTENTION WAS DRAWN ARE AS UNDER: 3. I HAVE CAREFULLY EXAMINED THE ENTIRE FACTS OF T HE CASE FROM THE ASSESSMENT RECORD. PERUSAL OF ASSESSMENT RECORD SHOWS THAT THE ASSESSES FILED AN AFFIDAVIT IN WHICH IT HAS BEEN MENTIONED THAT HE HAS GIVEN HIS THREE ACRES AGRICULTURE LAND ON LEASE FOR TEN YEARS AND RECEIVE D LEASE MONEY OF RS.9,50,000/- IN CASH FROM SH. PARDEEP SIN GH. SIMILARLY AN AFFIDAVIT WAS ALSO FILED IN WHICH SH. PARDEEP SINGH HAS MENTIONED THAT HE HAS TAKEN THREE ACRES O F AGRICULTURE LAND ON LEASE FROM SH. MEWA SINGH (THE ASSESSE) AND PAID RS.9,50,000/- IN CASH AS LEASE CONSIDERATION. THE ASSESSING OFFICER SIMPLY RELIED UPON THE SUBMISSION MADE BY THE ASSESSEE AND DID NOT MAKE AN Y ENQUIRY TO FIND OUT CORRECTNESS OF THESE AFFIDAVITS . IN NAKAL JAMABANDI FILED BY THE ASSESSEE DURING ASSESSMENT PROCEEDINGS, HE HAS BEEN SHOWN AS CULTIVATOR OF HIS AGRICULTURE FIELDS WHEREAS HE HAS CLAIMED THAT HE H AS GIVEN HIS LAND ON LEASE. THE ASSESSING OFFICER HAS FAILED TO CALL FOR GIRDAWARI REPORT FROM HALKA PATWARI AND EVEN FAILED TO EXAMINE SOURCE OF CASH OF RS.9,50,000/- S HOWN TO BE GIVEN BY SH. PARDEEP SINGH TO THE ASSESSEE. T HE ASSESSING OFFICER HAS ALSO FAILED TO ENQUIRE ABOUT THE LEASE DEED/AGREEMENT IN CASE EXECUTED BY THE ASSESS EE WITH SH. PARDEEP SINGH. THESE FACTS CLEARLY PROVE T HAT THE ASSESSING OFFICER HAD COMPLETED THE ASSESSMENT WITHOUT CARRYING OUT NECESSARY & PROPER ENQUIRY WHI CH HE OUGHT TO HAVE CARRIED OUT. THIS FAILURE ON PART OF THE ASSESSING OFFICER, RENDERS THE ASSESSMENT ORDER ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INT EREST OF REVENUE. THE AO SHOULD CONDUCT DETAILED INQUIRIES REGARDING THE CLAIM OF THE ASSESSEE THAT HE HAD REC EIVED CASH FROM SHRI PRADEEP SINGH FOR LEASING OUT HIS LA ND TO HIM. THE AFFIDAVIT SHOULD BE EXAMINED IN DETAIL. IT REQUIRED THE PERSON TO WHOM THEY SAID LAND WAS LEASED SHOULD ALSO ITA -88/CHD/2021 A.Y. 2011-12 PAGE 6 OF 10 BE EXAMINED. INQUIRIES SHOULD ALSO BE MADE FROM LAN D REVENUE AUTHORITIES AND THE CASH DEPOSIT SHOULD BE INQUIRED INTO. 6. THE LD. DR STATED THAT THIS ITSELF SHOULD HAVE P ROMPTED THE AO TO CHECK THE VERACITY AND THE GENUINENESS OF THE AFFIDAVIT OF SHRI PRADEEP SINGH, WHICH THE AO HAVIN G FAILED TO DO, IT WAS A CLEAR CASE OF LACK OF INQUIRY. THAT M ERE ACCEPTANCE OF DOCUMENTS FILED BY THE ASSESSEE IN THE PRESENT C ASE COULD NOT BE TERMED AS INQUIRY HAVING BEEN CONDUCTED BY T HE AO. HE FURTHER POINTED OUT THAT THE LD. PCIT AT PARA 6 OF HIS ORDER HAD CATEGORICALLY FOUND THE ORDER OF THE AO ERRONEOUS O N ACCOUNT OF EXPLANATION-2 INSERTED TO SECTION 263 BY THE FINANC E ACT, 2015 WHICH CLEARLY MENTIONED THE ORDER PASSED WITHOUT MA KING INQUIRIES OR VERIFICATION WHICH SHOULD HAVE BEEN MA DE, AS BEING ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INT EREST OF THE REVENUE. 7. TO THIS, THE LD. COUNSEL FOR THE ASSESSEE COUNTE RED BY STATING THAT THE LD. PCIT HAD NOT SPECIFICALLY POIN TED OUT THE PARTICULAR CLAUSE OF EXPLANATION-2 IN WHICH THE CAS E WAS COVERED AND THE LD. DR COULD NOT HAVE BUILT UPON TH E CASE OF THE LD.PCIT IN THIS MANNER. 8. THE LD. DR FURTHER STATED THAT THE CASE LAWS REL IED UPON BY THE LD. COUNSEL FOR THE ASSESSEE WERE ALL DISTIN GUISHABLE ON FACTS. ITA -88/CHD/2021 A.Y. 2011-12 PAGE 7 OF 10 9. WE HAVE HEARD BOTH THE PARTIES AND HAVE GONE THR OUGH THE ORDER OF THE LD. PCIT. WE DO NOT FIND ANY MERIT IN THE CONTENTION OF THE LD. COUNSEL FOR THE ASSESSEE THAT THERE IS NO FINDING OF ERROR IN THE ORDER PASSED BY THE LD. PCI T. 10. THE CASE OF THE LD. PCIT IS THAT THE AO HAD NOT CONDUCTED INQUIRIES WHICH WERE REQUIRED TO BE DONE IN THE PRE SENT CASE. THIS IS BASED ON THE FACT THAT THE ASSESSEE'S JUS TIFICATION FOR THE CASH DEPOSITED IN HIS BANK ACCOUNT, AS HAVING B EEN RECEIVED FROM ONE SHRI PRADEEP SINGH FOR LEASING OU T HIS AGRICULTURAL LAND TO HIM FOR 10 YEARS SUBSTANTIATED BY AN AFFIDAVIT, IS CONTRADICTED BY THE NAKAL JAMABANDI OF THE SAID LAND FOR THE PERIOD WHICH RECORDS THE ASSESSEE AS C ULTIVATOR OF THE LAND. CLEARLY THESE ARE CONTRADICTORY FACTS, WI TH THE AFFIDAVIT STATING SHRI PRADEEP SINGH AS CULTIVATOR, WHILE THE REVENUE RECORDS SHOWING THE ASSESSEE AS THE CULTIVA TOR AND CONTROVERTING HIS CLAIM THAT HE HAD LEASED OUT HIS LAND TO SHRI PRADEEP SINGH. WE AGREE WITH THE REVENUE THAT THIS CONTRADICTION SHOULD HAVE PROMPTED FURTHER INQUIRY BY THE AO REGARDING THE GENUINENESS OF THE CLAIM OF THE ASSES SEE THAT HE HAD RECEIVED RS. 9,50,000/- BY LEASING OUT HIS LAND TO SHRI PRADEEP SINGH. THE DOCUMENTS ON RECORD BY NO STRET CH JUSTIFY THE ACCEPTANCE OF THE CLAIM OF THE ASSESSEE BY THE AO. NO PERSON OF SOUND AND LOGICAL MIND COULD HAVE, IN THE CIRCUMSTANCES, FOUND THE CLAIM OF THE ASSESSEE JUST IFIABLE IN ITA -88/CHD/2021 A.Y. 2011-12 PAGE 8 OF 10 THE LIGHT OF THE CONFLICTING DOCUMENTS BEFORE THE A O. THE AO, THEREFORE, NOT PROCEEDING WITH CONDUCTING FURTHER INQUIRY ON THE ISSUE AND HAVING ACCEPTED THE CLAIM OF THE ASS ESSEE, THE ORDER PASSED BY THE AO WE AGREE WITH THE LD. PCIT, IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. 11. THE CASE LAWS RELIED UPON BY LD. COUNSEL FOR TH E ASSESSEE ARE OF NO ASSISTANCE SINCE THE PROPOSITION LAID DO WN THEREIN REVOLVES AROUND THE PECULIAR FACTS AND CIRCUMSTANCE S IN THOSE CASES. IN THE CASE OF JEEWAN KUMAR(SUPRA), THE FAC TS REVEAL THAT THERE WAS CERTAIN CASH WHICH WAS FOUND IN THE POSSESSION OF THE ASSESSEE DURING CHECKING BY THE SURVEILLANCE TEAM WHICH HE EXPLAINED TO BELONG TO THE PROPRIETORSHIP CONCER N OF HIS FATHER OF WHICH HE WAS AN EMPLOYEE. THE AO ACCEPTE D THE ASSESSEE'S EXPLANATION AFTER CONSIDERING THE BOOKS OF ACCOUNT OF THE CONCERN AND THE STATEMENTS OF ALL THE CONCERNED PERSONS. IT WAS IN THIS BACKGROUND THAT THE ITAT HELD THAT T HE EXERCISE OF JURISDICTION U/S 263 BY THE COMMISSIONER SETTING ASIDE THE ASSESSMENT ON THE GROUND THAT THE AO SHOULD HAVE MA DE FURTHER INQUIRY WAS MERELY A CASE OF DIFFERENCE OF OPINION BETWEEN THE AO AND THE COMMISSIONER AND NOT THAT OF LACK OF INQUIRY AND ACCORDINGLY, THEREFORE, THE ORDER OF TH E COMMISSIONER WAS SET ASIDE. ITA -88/CHD/2021 A.Y. 2011-12 PAGE 9 OF 10 12. IN THE CASE OF NARAIN SINGLA (SUPRA), THE COMMI SSIONER IN EXERCISE OF HIS POWERS U/S 263 SET ASIDE THE ASSESS MENT ON THE GROUND THAT SUBSTANTIAL JEWELLERY WAS FOUND IN THE COURSE OF SEARCH WHICH WAS CLAIMED TO BE DECLARED UNDER VDIS- 1997 BY WIFE OF THE ASSESSEE, WHICH CLAIM THE AO HAD ACCEPT ED WITHOUT VERIFYING AND INQUIRING INTO THE FACTS. THE ITAT O N PERUSAL OF THE QUERIES RAISED BY THE AO AND THE REPLIES FILED THERETO FOUND THAT AO HAD DULY APPLIED HIS MIND TO THE ISSUE OF S EIZED JEWELLERY. THE ITAT NOTED THAT THE AO WAS FULLY AW ARE OF THE MATTER, HAD APPRAISED THE EVIDENCES FILED BY THE AS SESSEE AND THEN FORMED A VIEW TO ACCEPT THE SAME. IN THIS CAS E ALSO, THE ITAT HELD THAT IT WAS NOT A CASE OF LACK OF INQUIRY AS MADE OUT BY THE COMMISSIONER BUT A CASE OF DIFFERENCE OF OPI NION WHICH DID NOT GIVE THE COMMISSIONER POWER TO REVISE THE O RDER MADE BY THE AO. 13. THE FACTS IN THE CASE OF SHRI PAWAN KUMAR ARE S IMILAR WHEREIN ALSO THE ITAT FOUND THAT IT WAS NOT A CASE OF LACK OF ANY INQUIRY BUT ONLY A CASE OF DIFFERENCE OF OPINIO N. 14. IN THE PRESENT CASE, IT IS NOT A CASE OF DIFFER ENCE OF OPINION BUT INFACT IT IS CLEAR THAT THE OPINION OF THE AO WAS ONE WHICH WAS NOT JUSTIFIED BY THE EVIDENCES ON RECORD AND THEREFORE, THE FINDING OF ERROR BY THE LD.PR. CIT O N ACCOUNT OF LACK OF INQUIRY/INADEQUATE INQUIRY BY THE AO ON THE ISSUE IS, ITA -88/CHD/2021 A.Y. 2011-12 PAGE 10 OF 10 WE HOLD, IN ACCORDANCE WITH LAW FOR THE PURPOSE OF EXERCISING REVISIONARY JURISDICTION U/S 263 OF THE ACT. THE OR DER OF THE LD. PR.CIT IS ACCORDINGLY UPHELD. 15. IN VIEW OF THE ABOVE, THE GROUNDS OF APPEAL RAI SED BY THE ASSESSEE ARE DISMISSED. 16. THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED ON 27 TH OCTOBER, 2021. SD/- SD/- ( ! ) ( % & ' ( ) ) (DIVA SINGH) (ANNAPURNA GUPTA) ' #/ JUDICIAL MEMBER *+#/ ACCOUNTANT MEMBER POONAM *+ ,+ / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ' - / CIT 4. ' - ( )/ THE CIT(A) 5. +./ 0 , $ 0 , 123/4 / DR, ITAT, CHANDIGARH 6. /3 / GUARD FILE ' / BY ORDER, / ASSISTANT REGISTRAR