Rajinder Singh, Patiala V. ITO, Patiala

ITA 886/CHANDI/2014

• Counselvise Citation: 88621514 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
• Keywords: Opportunity of being heard
• 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. 886/CHD/2014 (ASSESSMENT YEAR: 2009-10) RAJINDER SINGH VS. THE INCOME TAX OFFICER, 2162, ANAND NAGAR-B, WARD 4, PATIALA. PATIALA. PAN NO. ARKPS4250M (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 : 2 1. THAT THE ASSESSMENT U/S 143(3) OF THE INCOME TAX AC T, 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.6 LACS MADE UNDER SECTION 68 OF THE INCOME TAX ACT, 1 961 (IN SHORT THE ACT). THE ASSESSEE IS AN INDIVIDUAL. FOR THE ASSESSMENT YEAR 2009-10, THE ASSESSEE SUBMITTED HIS RETURN OF INCOME ON 14.9.2009 DECLARING THE TOTAL INCOME A T RS.1,85,000/-. 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.15,10,000/- IN ICICI BANK, PATIALA. THE MAIN S OURCE OF INCOME OF THE ASSESSEE WAS FROM RESALE OF BUILDING MATERIAL. WHILE EXAMINING THE AFORESAID ACCOUNTS, THE ASSESSI NG OFFICER NOTICED THAT RS.1 LAC WERE DEPOSITED ON 4.4.2008 IN HIS BANK ACCOUNT WITH ICICI BANK AND RS.5 LACS ON 8.4.2008. AS REGARDS THE SOURCE OF DEPOSITS, THE ASSESSEE SUBMIT TED THAT HE RECEIVED CASH FROM HIS RELATIVE SHRI AMRIT PAL SING H, R/O VILLAGE MANPUR, TEHSIL KHANNA, DISTRICT LUDHIANA, A SUM OF RS.5,50,000/- ON 3.4.2008 AND OUT OF THIS AMOUNT, A SUM OF 3 RS.1 LACS WAS DEPOSITED IN HIS BANK ACCOUNT WITH IC ICI BANK ON 4.4.2008 AND RS.5 LACS ON 8.4.2008. THE ASSESSI NG OFFICER CATEGORICALLY STATED THAT THERE WAS NO EXPLANATION REGARDING THE BALANCE AMOUNT OF RS.50,000/-. HE FURTHER OBS ERVED THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AS SESSEE WAS ASKED TO PRODUCE SHRI AMRIT PAL SINGH FOR EXAMI NATION OF FACTS BUT THE ASSESSEE FAILED TO DO SO. THEREFORE , THE ASSESSING OFFICER CONCLUDED THAT THE ASSESSEE FAILE D TO PROVE THE CREDITWORTHINESS OF THE CREDITOR. CONSEQUENTLY , THE ASSESSING OFFICER ADDED RS.5,50,000/- AND RS.50,000 /- AS UNDISCLOSED INCOME OF THE ASSESSEE. THUS, TOTAL A DDITION MADE BY THE ASSESSING OFFICER IS RS.6 LACS. 4. ON APPEAL, THE LEARNED CIT (APPEALS) CONFIRMED THE ADDITION STATING THAT THE ASSESSEE FAILED TO PRODUC E SHRI AMRIT PAL SINGH DESPITE THE ASSESSING OFFICER HAVING ASKE D HIM TO DO SO. HE FURTHER OBSERVED THAT THE EXPLANATION OF THE ASSESSEE IS FULL OF LOOPHOLES AND THE TRANSACTION I S IN CASH. THUS, THE LEARNED CIT (APPEALS) DISMISSED THE APPEA L OF THE ASSESSEE. 5. I HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE PER USED THE MATERIALS AVAILABLE ON RECORD. 6. IT IS OBSERVED THAT SIMILAR ISSUE CAME UP FOR CONSIDERATION IN THE CASE OF SHRI SATWINDER SINGH VS. I.T.O., PATIALA IN ITA NO.884/CHD/2014 RELATING TO ASSESSME NT YEAR 4 2009-10. THIS BENCH OF THE TRIBUNAL (SMC) VIDE OR DER OF EVEN DATE HELD AS UNDER : 5. I HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE PERUSED THE MATERIALS AVAILABLE ON RECORD. 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 SINGH. SHRI HARPREET SINGH HAS SUBMITTED AN AFFIDAVIT WHEREIN HE HAS CONFIRMED HAVING GIVEN THE AMOUNT IN QUESTION. REGARDING 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 AFORESA ID AMOUNTS WERE GIVEN BY HER TO THE ASSESSEE. ACCORDING TO THE LEARNED COUNSEL FOR THE ASSESSEE, BOTH THE LOWER AUTHORITIES HAVE NOT CONSIDERED 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 AND SMT.JASMEET KAUR BEFORE HIM, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THIS OBSERVATION IS FACTUALLY INCORR ECT. ACCORDING TO THE LEARNED COUNSEL FOR THE ASSESSEE, THE ASSESSING OFFICER DID NOT ISSUE ANY NOTICE TO S HRI HARPREET SINGH AND SMT.JASMEET KAUR AND AS SUCH, NO ENQUIRIES WERE CONDUCTED BY THE ASSESSING OFFICE R BEFORE REJECTING THE VERSION OF THE ASSESSEE REGARD ING THE PAYMENTS MADE TO HIM BY HIS ABOVE MENTIONED RELATIVES. THE LEARNED COUNSEL FOR THE ASSESSEE FURTHER SUBMITTED THAT THE ASSESSEE HAD PRODUCED AL L INFORMATIONS ABOUT THE CREDITORS. IT IS CLAIMED T HAT 5 THE CREDITOR SHRI HARPREET SINGH IS AN AGRICULTURIS T AND SMT.JASMEET KAUR IS A REGULAR INCOME TAX ASSESSEE. THE LEARNED COUNSEL FOR THE ASSESSEE VEHEMENTLY ARGUED THAT THERE IS NO JUSTIFICATION IN MAKING THE ADDITION. THE LEARNED COUNSEL FOR THE ASSESSEE FURTHER SUBMITTED THAT ON 18.11.2011, THE ASSESSING OFFICER CONCERNED ASKED THE ASSESSEE TO PRODUCE SHRI HARPREET SINGH AND SMT.JASMEET KAUR FOR EXAMINATION ON 30.11.2011. HOWEVER, ON 30.11.2011, THE ASSESSEE COULD NOT PRODUCE THE ABOVE CREDITORS BEFORE THE ASSESSING OFFICER FOR EXAMINATION DUE TO THE REASONS, WHICH WERE BEYOND THE CONTROL OF THE ASSESSEE, AND THE ASSESSING OFFI CER DECLINED TO GRANT ANY FURTHER OPPORTUNITY TO THE ASSESSEE TO PRODUCE THE CREDITORS AND ON THE SAME DAY I.E. ON 30.11.2011 PASSED THE ASSESSMENT ORDER. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT BOTH THE AUTHORITIES BELOW WERE NOT JUSTIFIED IN HOLDING THAT ADEQUATE OPPORTUNITY WAS GIVEN TO THE ASSESSEE TO PRODUCE SHRI HARPREET SINGH AND HIS SISTER-IN-LAW. AT THIS STAGE, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED AN AFFIDAVIT DATED 1.7.2015 OF THE ASSESSEE WHEREIN THE ASSESSEE HAS STATED 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 THA N THE SAME AMOUNT WILL BE CONSIDERED MY-INCOME I WILL BE LIABLE TO PAY TAX ON THAT AMOUNT. 7. AS PER THE ABOVE AFFIDAVIT, THE ASSESSEE UNDERTAKES TO PRODUCE THE ABOVE CREDITORS BEFORE TH E ASSESSING OFFICER FOR EXAMINATION. CONSIDERING THE ENTIRE 6 FACTS AND CIRCUMSTANCES OF THE PRESENT CASE, I AM OF THE CONSIDERED VIEW THAT THE AUTHORITIES BELOW HAVE NOT PROVIDED ADEQUATE OPPORTUNITY TO THE ASSESSEE TO PR ODUCE THE CREDITORS FOR EXAMINATION AND HAVE DRAWN ADVERS E INFERENCE AGAINST THE ASSESSEE. THEREFORE, IN THE INTEREST OF JUSTICE, I THINK IT APPROPRIATE TO SET ASIDE THE ORDER OF THE CIT (APPEALS) ON THIS ISSUE AND REMAND THE MATT ER TO THE ASSESSING OFFICER WITH THE DIRECTION TO DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH LAW AFTER AFFORDING DUE AND REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. IT IS MADE CLEAR THAT THE ASSESSEE HAS STATED IN HIS AFFIDAVIT DATED 1.7.2015 THAT AN OPPORTUNITY MAY BE GIVEN TO HIM TO PRODUCE THE CREDITORS FOR EXAMINATI ON BEFORE THE ASSESSING OFFICER. IN CASE, IF THE ASS ESSEE FAILS TO PRODUCE THE CREDITORS FOR EXAMINATION , TH E ASSESSING OFFICER IS FREE TO DECIDE THE MATTER IN ACCORDANCE WITH LAW. 8. FOR STATISTICAL PURPOSES, THE APPEAL OF THE ASSESSEE IS ALLOWED. 7. THE FACTS OF THE PRESENT CASE ARE SIMILAR TO TH E FACTS OF THE CASE OF SHRI SATWINDER SINGH, REFERRED TO AB OVE. IN VIEW OF THE ORDER PASSED IN THE CASE OF SHRI SATWIN DER SINGH, I SET ASIDE THE ORDER OF THE LEARNED CIT (APPEALS) AN D REMAND THE MATTER TO THE ASSESSING OFFICER WITH THE DIRECT IONS TO DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH LAW AFTE R AFFORDING DUE AND REASONABLE OPPORTUNITY OF BEING HEARD TO TH E 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 7 THE CREDITORS FOR EXAMINATION, THE ASSESSING OFFICE R 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