Vishal Gupta HUF, Ghaziabad V. ITO, Ward- 2(5), Ghaziabad

ITA 888/DEL/2018

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 2420 (ITAT-DELHI)
• Duration Of Justice: 9 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-11-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 05-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S L ANURAGI
• Assessee Lawyers: SAUBHAGYA AGARWAL
• Keywords: Opportunity of being heard; Additional evidence
• Section: 68; 144

Judgement Text

PAGE | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F : NEW DELHI BEFORE SHRI AMIT SHUKLA , JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO. 888/DEL/2018 (ASSESSMENT YEAR: 2014 - 15 ) VISHAL GUPTA HUF, 202, B - 25, SURYA NAGAR, GHAZIABAD PAN: AAEHV8588G VS. ITO, WARD - 2(5), GHAZIABAD (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI SAUBHAGYA AGARWAL, ADV REVENUE BY: SHRI S.L. ANURAGI, SR. DR DATE OF HEARING 21/08 / 2018 DATE OF PRONOUNCEMENT 1 3 / 1 1 / 2018 O R D E R PER PRASHANT MAHARISHI , A. M. 1 . THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD CIT(A) , GHAZIABAD DATED 12.10.2017 FOR THE ASSESSMENT YEAR 2014 - 15. 2 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1 THAT THE LD CIT( APPEALS) HAS ERRED IN LAW AND ON FACTS IN TREATING HAT SUFFICIENT OPPORTUNITIES WERE GRANTED DESPITE THE FACT THAT THE LD AO WAS NOT AVAILABLE AT MOST OF THE DATES/ TIMES AND ASSESSMENT WAS COMPLETED WITHOUT PROPER OPPORTUNITY OF BEING HEARD. 2. THAT THE LD CIT(APPEAL) HAS ERRED IN LAW AND ON FACTS IN REJECTING THE ADDITIONAL EVIDENCES UNDER RULE 46A TREATING THAT SUFFICIENT OPPORTUNITIES WERE GRANTED DESPITE THE FACT THAT THE LD AO WAS NOT AVAILABLE AT MOST OF THE DATES/ TIMES AND ASSESSMENT WAS COMPLETED WITHOUT PROPER OPPORTUNITY OF BEING HEARD. 3. THAT THE LD CIT(APPEAL) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ADDITION OF RS. 26,00,000/ - . 4. THAT THE IMPUGNED APPELLATE ORDER IS ARBITRARY, ILLEGAL, BAD IN LAW AND IN VIOLATION OF RUDIMENTARY PRIN CIPLES OF CONTEMPORARY JURISPRUDENCE. 3 . ASSESSEE IS AN HUF WHO FILED ITS RETURN OF INCOME ON 24 / 7 / 2014 DECLARING TOTAL INCOME OF 27160/ . THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY THROUGH CASS ON THE BASIS OF THE REASON THAT LARGE PAGE | 2 INVESTMENT I N PROPERTY AS COMPARED TO TOTAL INCOME HAS BEEN MADE BY THE ASSESSEE. THEREFORE, THE ISSUE WAS TAKEN UP FOR SCRUTINY AND ASSESSEE WAS ISSUED NOTICE UNDER SECTION 144 OF THE INCOME TAX ACT AFTER CERTAIN NON - COMPLIANCE. IN RESPONSE TO THAT NOTICE THE ASSESSE E APPEARED BEFORE THE ASSESSING OFFICER AND STATED THAT ASSESSEE HAS PURCHASED THE PROPERTY AMOUNTING TO 8 140000/ AND PAID STAMP DUTY OF 5 70000/ IN WHICH ASSESSEE HAS ONE THIRD SHARE OF THE PROPERTY. THE ASSESSEE EXPLAINED THAT FOR THE PURPOSE OF P URCHASE OF THE PROPERTY ASSESSEE HAS TAKEN ON LOAN OF 26 LAKHS FROM ONE PRIVATE LIMITED COMPANY AND SUBMITTED ITS CONFIRMATION LETTER. HOWEVER, THE ASSESSEE DID NOT PRODUCE THE BANK ACCOUNT AND COPY OF THE RETURN OF THE LENDER OR ITS PERMANENT ACCOUNT NU MBER. THE LEARNED ASSESSING OFFICER ISSUED SUMMONS TO THE DIRECTOR OF THAT PRIVATE LIMITED COMPANY AND ALSO ISSUED NOTICE UNDER SECTION 133 (6) OF THE ACT HOWEVER NONE APPEARED AND THEREFORE THE LEARNED AO WHO PASSED IN ORDER UNDER SECTION 143 (3) OF TH E INCOME TAX ACT ON 22 / 12 / 2016 DETERMINING THE TOTAL INCOME OF THE ASSESSEE AT 2 627160. THUS ADDITION OF 26 LAKHS UNDER SECTION 68 OF THE INCOME TAX ACT WAS MADE BY THE LEARNED AO. 4 . THE ASSESSEE AGGRIEVED WITH THE ORDER OF THE LEARNED ASSESSING OFFIC ER PREFERRED THE APPEAL BEFORE THE LEARNED COMMISSIONER OF INCOME TAX APPEALS. BEFORE THE LEARNED COMMISSIONER OF INCOME TAX APPEAL ASSESSEE MADE AN APPLICATION UNDER RULE 46A OF THE INCOME TAX ACT SUBMITTING THE REQUISITE INFORMATION AS A FRESH EVIDENCE ( ADDITIONAL EVIDENCE). THE LEARNED COMMISSIONER OF INCOME TAX APPEALS HELD THAT THE APPLICATION OF THE ASSESSEE IS NOT MAINTAINABLE AS THE ASSESSEE HAS FAILED TO SHOW SUFFICIENT CAUSE. EVEN OTHERWISE HE HELD THAT THE LENDER OF 26 LAKHS HAS FILED RETURN OF INCOME DECLARING NIL GROSS INCOME AND NIL TOTAL INCOME AND FURTHER THE NOTICES WERE SERVED BY THE AO AT THE ADDRESS PROVIDED BY THE ASSESSEE OF THE LENDER WHICH REMAIN ON COMPLIED WITH , THE DETAILS FURNISHED BY THE ASSESSEE DO NOT SUBSTANTIATE THE GEN UINENESS OF THE TRANSACTION AND CREDITWORTHINESS OF THE LENDER SPECIFICALLY WHEN THE RETURN OF INCOME IS FILED AT RUPEES NIL BY THE LENDER. THEREFORE HE CONFIRMED THE PAGE | 3 ASSESSMENT ORDER. HENCE, ASSESSEE AGGRIEVED HAS PREFERRED APPEAL BEFORE US. 5 . THE LEARNED A UTHORISED REPRESENTATIVE SUBMITTED A PAPER BOOK AND STATED THAT ASSESSEE HAS SUBMITTED THE CONF I RMATION OF LOAN AND ALSO STATED THE PERMANENT ACCOUNT NUMBER OF THE LENDER. FURTHER, THE CONTRA INFORMATION ACCOUNT WERE ALSO PROVIDED FOR. THIS WAS ALSO SUBSTA NTIATED BY FILING THE INCOME TAX RETURN COPIES OF THE LENDER FOR ASSESSMENT YEAR 2014 15 AND 2015 16. HE OTHERWISE STATED THAT THE ADDITIONAL EVIDENCE SUBMITTED BY THE ASSESSEE HAS NOT BEEN CONSIDERED BY THE LEARNED COMMISSIONER OF INCOME TAX APPEALS I N PROPER PERSPECTIVE AND FURTHER NO ADEQUATE OPPORTUNITY WAS GRANTED BY THE LEARNED ASSESSING OFFICER. EVEN OTHERWISE, HE COMMITTED BEFORE US THAT THE ASSESSEE IS READY TO GO BACK TO THE OFFICE OF THE LEARNED ASSESSING OFFICER AND SUBMIT THE REQUISITE DETA ILS. 6 . THE LEARNED DEPARTMENTAL REPRESENTATIVE VEHEMENTLY STATED THAT AS ASSESSEE HAS NOT SHOWN SUFFICIENT CAUSE BEFORE THE LEARNED COMMISSIONER OF INCOME TAX APPEALS AND DID NOT SUBMIT THE REQUISITE DETAIL BEFORE THE LEARNED ASSESSING OFFICER THE ADDITIONAL EVIDENCES HAVE RIGHTLY BEEN REJECTED BY THE LEARNED COMMISSIONER OF INCOME TAX APPEALS. EVEN OTHERWISE, HE STATED THAT THE LENDER HAS NO SOURCE OF INCOME AND THEREFORE THE GENUINENESS OF LOAN OF 26 LAKHS GIVEN TO THE ASSESSEE BY THE LENDER DOES NOT SATI SFY THE REQUIREMENT OF SECTION 68 OF THE INCOME TAX ACT. 7 . WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTION AND PERUSED THE ORDERS OF THE LOWER AUTHORITIES. ADMITTEDLY, THE ASSESSEE HAS OBTAINED A LOAN OF 26 LAKHS FROM A PRIVATE LIMITED COMPANY FOR PURCHA SE OF PROPERTY. ASSESSEE HAS SUBSTANTIATED BEFORE US THE TRANSACTION BY SUBMITTING THE ABOVE DETAILS IN THE FORM OF CONTRA ACCOUNTS, PERMANENT ACCOUNT NUMBER, CONFIRMATION AND THE INCOME TAX RETURNS OF THE LENDER. HOWEVER IT IS ALSO TRUE THAT THE SUMMONS I SSUED BY THE LEARNED ASSESSING OFFICER REMAINED UNCOMPLIED WITH AND FURTHER THE NOTICE ISSUED UNDER SECTION 133 (6) OF THE INCOME TAX ACT WAS NOT REPLIED. THIS IS BECAUSE OF THE REASON THAT ASSESSEE DID NOT HAVE SUFFICIENT OPPORTUNITY BEFORE THE LEARNED AS SESSING PAGE | 4 OFFICER. BEFORE THE LEARNED COMMISSIONER OF INCOME TAX APPEAL ASSESSEE SUBMITTED THE COMPLETE DETAILS, WHICH WERE REJECTED AT THE THRESHOLD. IT IS ALSO THE CLAIM OF THE ASSESSEE THAT SHRI MUKESH MITTAL THE DIRECTOR OF THE LENDER COMPANY VISITED THE OFFICE OF THE LEARNED ASSESSING OFFICER ON 23/12/2016 HOWEVER, THE ASSESSMENT ORDER WAS ALREADY PASSED BY THE LEARNED ASSESSING OFFICER ON 22/12/2016. IN VIEW OF THE ABOVE FACTS , WE ARE OF THE OPINION THAT WHEN THE ASSESSEE HAS PRODUCED THE DIRECTOR BEFORE THE LEARNED ASSESSING OFFICER BUT AFTER THE ASSESSMENT ORDER HAS BEEN PASSED ONE DAY PRIOR TO THE APPEARANCE BY THE DIRECTOR OF THE LENDER COMPANY, IN THE INTEREST OF JUSTICE , THE MATTER IS RESTORED BACK TO THE FILE OF THE LEARNED ASSESSING OFFICER WITH A DIRECTION TO THE ASSESSEE TO PRODUCE THE DIRECTOR OF THE LENDER COMPANY BEFORE THE ASSESSING OFFICER ALONG WITH ANY OTHER DETAIL WHICH ASSESSEE WOULD LIKE TO SUBSTANTIATE THE T RANSACTION . THE LEARNED AO IS FURTHER DIRECTED TO EXAMINE THE DETAILS FURNISHED BY THE ASSESSEE AS WELL AS THE DIRECTOR OF THE LENDER COMPANY AND DECIDE THE ISSUE AFRESH . WE FURTHER DIRECT THE LEARNED ASSESSING OFFICER TO NOT TO GET INFLUENCED BY THE OBSER VATION OF THE LEARNED CIT A ABOUT THE NIL INCOME OF THE LENDER BECAUSE THERE MAY BE ANY OTHER SOURCE AVAILABLE WITH THE COMPANY TO ADVANCE LOAN TO THE ASSESSEE. HE MAY EXAMINE THE ISSUE FOR ASCERTAINING THE CREDITWORTHINESS OF THE LENDER AND GENUINENESS OF THE TRANSACTION. IN THE RESULT GROUND NUMBER 1 OF THE APPEAL OF THE ASSESSEE IS ALLOWED WITH ABOVE DIRECTION. 8 . IN VIEW OF ABOUT DECISION IN GROUND NUMBER 1 OF THE APPEAL WE DO NOT FIND IT PROPER TO ADJUDICATE ON GROUND NUMBER 3 OF THE APPEAL OF THE ASSES SEE. 9 . IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 1 3 / 1 1 / 2018 . S D / - S D / - ( AMIT SHUKLA ) (PRASHANT MAHARISHI) JUDICIAL MEMBER ACCOUNTANT MEMBER DA TED: 1 3 / 1 1 / 2018 A K KEOT COPY FORWARDED TO PAGE | 5 1 . APPLICANT 2 . RESPONDENT 3 . CIT 4 . CIT (A) 5 . DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI PAGE | 6 DATE OF DICTATION DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/ PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/ PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DAT E OF DISPATCH OF THE ORDER