Satwinder Singh, Patiala V. ITO, Patiala

ITA 884/CHANDI/2014

• Counselvise Citation: 88421514 RSA 2014
• Duration Of Justice: 8 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-07-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 06-07-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 20-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Assessee Lawyers: DEEPINDER SINGH
• Section: 143(3); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES SMC CHANDIGARH BEFORE SHRI H.L.KARWA, HON'BLE VICE PRESIDENT ITA NO. 884/CHD/2014 (ASSESSMENT YEAR: 2009-10) SATWINDER SINGH VS. THE INCOME TAX OFFICER, 5/105, RANJIT NAGAR, WARD 4, BHADSON ROAD, PATIALA. PATIALA. PAN NO. ACFPS0268M (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI DEEPINDER SINGH RESPONDENT BY : SHRI S.K.MITTAL, DR DATE OF HEARING : 06.07.2015 DATE OF PRONOUNCEMENT : 09.07.2015 O R D E R PER H.L.KARWA, VP : THIS APPEAL FILED BY THE ASSESSEE IS DIR ECTED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS), PATIALA DATED 19.9.2014 RELATING TO ASSE SSMENT YEAR 2009-10. 2. IN THIS APPEAL, THE ASSESSEE HAS RAISED THE FOL LOWING GROUNDS : 1. THAT THE ASSESSMENT U/S 143(3) OF THE INCOME TAX AC T, 2 1961 BY THE ASSESSING OFFICER IS NOT JUSTIFIED. OR DER OF THE LEARNED INCOME TAX OFFICER IS ERRONEOUS, ARBITRARY, OPPOSED AND FACTS OF THE CASE AND IS THIS UNTENABLE. 2. THAT THE ORDER OF THE COMMISSIONER OF INCOME TAX AP PEALS), PATIALA, U/S 250(6) UPHOLDING THE ORDER PASSED BY THE INCOME TAX OFFICER U/S 143(3), IS NOT JUSTIFIED. 3. THAT THE APPELLANT CRAVES-LEAVE TO ADD, DELETE OR A MEND ANY GROUND OF APPEAL BEFORE THE APPEAL HEARD AND FI NAL DISPOSED OFF. 3. THE DISPUTE IN THIS APPEAL RELATES TO ADDITION OF RS.5,97,000/- MADE UNDER SECTION 68 OF THE INCOME T AX ACT, 1961 (IN SHORT THE ACT). THE ASSESSEE IS AN IND IVIDUAL. FOR THE ASSESSMENT YEAR 2009-10, THE ASSESSEE SUBMITTED HIS RETURN OF INCOME ON 14.9.2009 DECLARING THE TOTAL I NCOME AT RS.1,97,450/-. THE SAID RETURN WAS PROCESSED UND ER SECTION 143(1) OF THE ACT. SUBSEQUENTLY, THE CASE WAS SEL ECTED UNDER COMPULSORY SCRUTINY ON THE BASIS OF AIR INFORMATION AS THE ASSESSEE WAS FOUND TO BE IN POSSESSION OF DEPOSIT O F RS.19,27,500/- IN AXIS BANK LIMITED, THE MALL ROAD BRANCH, PATIALA AND DEPOSIT OF RS.11,69,000/- IN ICICI BANK , PATIALA. THE MAIN SOURCE OF INCOME OF THE ASSESSEE WAS FROM RESALE OF BUILDING MATERIAL. WHILE EXAMINING THE AFORESAID ACCOUNTS, THE ASSESSING OFFICER NOTICED THAT RS.3 LACS WERE D EPOSITED ON 8.4.2008 AND RS.2,57,000/- ON 25.6.2008 IN ICICI BA NK. AS REGARDS THE SOURCE OF DEPOSITS, THE ASSESSEE SUBMIT TED THAT HE RECEIVED CASH FROM HIS RELATIVES SHRI HARPREET SING H, R/O HOUSE NO.547, SECTOR 12, SONIA COLONY, AMBALA, A SU M OF RS.3 LACS ON 3.4.2008 AND DEPOSITED THE SAME IN ICI CI BANK AND ALSO RECEIVED A SUM OF RS.1,80,000/- FROM HIS S ISTER-IN- 3 LAW ON 2.6.2008, AND RS.2,57,000/- (RS.1,80,000 + RS.77,000/-) WERE DEPOSITED IN ICICI BANK ON 25.6.2 008. THE ASSESSING OFFICER CATEGORICALLY STATED THAT THE RE WAS NO EXPLANATION REGARDING THE AMOUNT OF RS.77,000/-. HE FURTHER OBSERVED THAT DURING THE COURSE OF ASSESSMENT PROCE EDINGS, THE ASSESSEE WAS ASKED TO PRODUCE SHRI HARPREET SIN GH AND HIS SISTER-IN-LAW FOR EXAMINATION OF FACTS BUT THE ASSESSEE FAILED TO DO SO. THEREFORE, THE ASSESSING OFFICER CONCLUDED THAT THE ASSESSEE FAILED TO PROVE THE CREDITWORTHIN ESS OF THE CREDITORS. CONSEQUENTLY, THE ASSESSING OFFICER ADD ED RS.3 LACS AND RS.2,57,000/- AS UNDISCLOSED INCOME OF THE ASSESSEE. THE ASSESSING OFFICER ALSO NOTICED THAT THE ASSESSE E HAS STATED HAVING RECEIVED RS.20,000/- FROM HIS SISTER- IN-LAW ON 27.1.2009 AND FURTHER RS.20,000/- ON 7.2.2009. THE ASSESSING OFFICER ALSO ADDED A SUM OF RS.40,000/- A S UNDISCLOSED INCOME OF THE ASSESSEE. THUS, TOTAL A DDITION MADE BY THE ASSESSING OFFICER IS RS.5,97,000/-. 4. ON APPEAL, THE LEARNED CIT (APPEALS) CONFIRMED THE ADDITION STATING THAT THE ASSESSEE FAILED TO PRODUC E THE CONCERNED PERSONS FROM WHOM THE ASSESSEE HAS STATED TO HAVE RECEIVED THE MONEY. HE FURTHER OBSERVED THAT ALL T HE TRANSACTIONS WERE IN CASH AND IN THE ABSENCE OF CON CRETE PROOF REGARDING THE CREDITWORTHINESS OF THE CREDITORS AND GENUINENESS OF THE TRANSACTIONS, THE SAME CANNOT BE ACCEPTED. 5. I HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE PER USED THE MATERIALS AVAILABLE ON RECORD. 4 6. SHRI DEEPINDER SINGH, LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT RS.3 LACS WERE RECEIVED BY THE ASSESSEE IN CASH FROM HIS RELATIVE SHRI HARPREET SI NGH. SHRI HARPREET SINGH HAS SUBMITTED AN AFFIDAVIT WHEREIN H E HAS CONFIRMED HAVING GIVEN THE AMOUNT IN QUESTION. RE GARDING THE ADDITION OF RS.2,97,000/-, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE AMOUNT IN QUESTION HAS BEEN RECEIVED FROM SMT.JASMEET KAUR, SISTER-IN-LAW OF TH E ASSESSEE ON VARIOUS DATES. SMT.JASMEET KAUR HAD ALSO FILED AN AFFIDAVIT CONFIRMING THAT THE AFORESAID AMOUNTS WER E GIVEN BY HER TO THE ASSESSEE. ACCORDING TO THE LEARNED C OUNSEL FOR THE ASSESSEE, BOTH THE LOWER AUTHORITIES HAVE NOT C ONSIDERED THE ABOVE EXPLANATION OF THE ASSESSEE IN ITS RIGHT PERSPECTIVE. AS REGARDS THE OBSERVATION OF THE ASSESSING OFFICER THAT HE ASKED THE ASSESSEE TO PRODUCE SHRI HARPREET SINGH A ND SMT.JASMEET KAUR BEFORE HIM, THE LEARNED COUNSEL FO R THE ASSESSEE SUBMITTED THAT THIS OBSERVATION IS FACTUAL LY INCORRECT. ACCORDING TO THE LEARNED COUNSEL FOR T HE ASSESSEE, THE ASSESSING OFFICER DID NOT ISSUE ANY NOTICE TO S HRI HARPREET SINGH AND SMT.JASMEET KAUR AND AS SUCH, NO ENQUIRIE S WERE CONDUCTED BY THE ASSESSING OFFICER BEFORE REJECTING THE VERSION OF THE ASSESSEE REGARDING THE PAYMENTS MADE TO HIM BY HIS ABOVE MENTIONED RELATIVES. THE LEARNED CO UNSEL FOR THE ASSESSEE FURTHER SUBMITTED THAT THE ASSESSEE HA D PRODUCED ALL INFORMATIONS ABOUT THE CREDITORS. IT IS CLAIMED THAT THE CREDITOR SHRI HARPREET SINGH IS AN AGRICUL TURIST AND SMT.JASMEET KAUR IS A REGULAR INCOME TAX ASSESSEE. THE LEARNED COUNSEL FOR THE ASSESSEE VEHEMENTLY ARGUED THAT THERE 5 IS NO JUSTIFICATION IN MAKING THE ADDITION. THE L EARNED COUNSEL FOR THE ASSESSEE FURTHER SUBMITTED THAT ON 18.11.2011, THE ASSESSING OFFICER CONCERNED ASKED T HE ASSESSEE TO PRODUCE SHRI HARPREET SINGH AND SMT.JAS MEET KAUR FOR EXAMINATION ON 30.11.2011. HOWEVER, ON 30.11.2011, THE ASSESSEE COULD NOT PRODUCE THE ABOV E CREDITORS BEFORE THE ASSESSING OFFICER FOR EXAMINAT ION DUE TO THE REASONS, WHICH WERE BEYOND THE CONTROL OF THE A SSESSEE, AND THE ASSESSING OFFICER DECLINED TO GRANT ANY FUR THER OPPORTUNITY TO THE ASSESSEE TO PRODUCE THE CREDITOR S AND ON THE SAME DAY I.E. ON 30.11.2011 PASSED THE ASSESSME NT ORDER. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT BOTH THE AUTHORITIES BELOW WERE NOT JUSTIFIED IN HOLDING THA T ADEQUATE OPPORTUNITY WAS GIVEN TO THE ASSESSEE TO PRODUCE SH RI HARPREET SINGH AND HIS SISTER-IN-LAW. AT THIS STAG E, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED AN AFFID AVIT DATED 1.7.2015 OF THE ASSESSEE WHEREIN THE ASSESSEE HAS S TATED AS UNDER : THAT I HAVE NOT OBTAINED PROPER OPPORTUNITY FROM T HE ASSESSING OFFICER TO PRODUCE THE LOAN CREDITORS BEF ORE HIM FOR CROSS EXAMINATION. I FURTHER STATED THAT IF I WILL NOT PRODUCED THE CREDITORS BEFORE THE AUTHORITY THAN THE SAME AM OUNT WILL BE CONSIDERED MY-INCOME I WILL BE LIABLE TO PAY TAX ON THAT AMOUNT. 7. AS PER THE ABOVE AFFIDAVIT, THE ASSESSEE UNDER TAKES TO PRODUCE THE ABOVE CREDITORS BEFORE THE ASSESSING OFFICER FOR EXAMINATION. CONSIDERING THE ENTIRE FACTS AND CIRC UMSTANCES OF THE PRESENT CASE, I AM OF THE CONSIDERED VIEW TH AT THE AUTHORITIES BELOW HAVE NOT PROVIDED ADEQUATE OPPORT UNITY TO 6 THE ASSESSEE TO PRODUCE THE CREDITORS FOR EXAMINATI ON AND HAVE DRAWN ADVERSE INFERENCE AGAINST THE ASSESSEE. THEREFORE, IN THE INTEREST OF JUSTICE, I THINK IT A PPROPRIATE TO SET ASIDE THE ORDER OF THE CIT (APPEALS) ON THIS IS SUE AND REMAND THE MATTER TO THE ASSESSING OFFICER WITH THE DIRECTION TO DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH LAW A FTER AFFORDING DUE AND REASONABLE OPPORTUNITY OF BEING H EARD TO THE ASSESSEE. IT IS MADE CLEAR THAT THE ASSESSEE HAS STATED IN HIS AFFIDAVIT DATED 1.7.2015 THAT AN OPPORTUNITY MA Y BE GIVEN TO HIM TO PRODUCE THE CREDITORS FOR EXAMINATION BEF ORE THE ASSESSING OFFICER. IN CASE, IF THE ASSESSEE FAILS TO PRODUCE THE CREDITORS FOR EXAMINATION , THE ASSESSING OFFIC ER IS FREE TO DECIDE THE MATTER IN ACCORDANCE WITH LAW. 8. FOR STATISTICAL PURPOSES, THE APPEAL OF THE ASS ESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 9 TH DAY OF JULY, 2015. SD/- (H.L.KARWA) VICE PRESIDENT DATED : 9 TH JULY, 2015 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH