Shri Om Prakash Khandelwal, Khargone V. THE ITO, Khandwa

ITA 943/IND/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 5731 (ITAT-INDORE)
• Duration Of Justice: 6 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-03-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 16-03-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 12-09-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MOHD JAVED
• Assessee Lawyers: S S SOLANKI
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 68

Judgement Text

SHRI OM PRAKASHKHANDELWAL ITA NO. 943/IND/2016 1 , , IN THE INCOME TAX APPELLATE TRIB UNAL, INDORE BENCH, INDORE BEFORE SHRI C.M. GARG, JUDICIAL MEMBER AND SHRI O.P. MEENA, ACCOUNTANT MEMBER .../ I.T.A. NO. 943/IND/2016 / ASSESSMENT YEAR: 2011-12 OM PRAKASH KHANDELWAL KHANDWA PAN AMUPK 7053J :: / APPELLANT VS INCOME TAX OFFICER KHANDWA :: ! / RESPONDENT '# $ % & / ASSESSEE BY SHRI S.S. SOLANKI '( $ % & / REVENUE BY SHRI MOHD. JAVED ) * $ #+ DATE OF HEARING 16.3.2017 ,-./ $ #+ DATE OF PRONOUNCEMENT 2 0 .3.2017 / O R D E R PER SHRI C.M. GARG, JM THIS APPEAL HAS BEEN FILED BY THE ASSESSEE-APPELLAN T AGAINST THE ORDER OF THE LEARNED CIT(A)-2, NEW DELHI, HOLDI NG CONCURENT JURISDICTION OVER THE CIT(A)-II, INDORE, DATED 15.6 .2016 IN FIRST SHRI OM PRAKASHKHANDELWAL ITA NO. 943/IND/2016 2 APPEAL NO. 270/13-14/54CIT(A)/BPL/IT-268/13-14 FOR THE ASSESSMENT YEAR 2011-12. 2. THE GROUNDS OF APPEAL RAISED BY THE APPELLANT READ AS FOLLOWS :- THAT THE LEARNED CIT(A) ERRED IN NOT ALLOWING PROP ER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE INSPITE OF REQUEST MADE IN THIS REGARD. THE ORDER SO PASSED BEING ILLE GAL AND WRONG, THE SAME, THEREFORE, REQUIRES TO BE QUASHED. WITHOUT PREJUDICE TO THE ABOVE THAT THE LEARNED CIT(A) ERRED IN CONFIRMING THE ADD ITION OF RS.15,50,000/- MADE U/S 68 IN RESPECT OF UNSECURED LOAN WITHOUT PROPER VERIFICATION OF THE FACTS. THE DISAL LOWANCE SO CONFIRMED BEING ILLEGAL AND WRONG, THE SAME REQUIRE TO BE DELETED. 3. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D CAREFULLY PERUSED THE RELEVANT MATERIAL PLACED ON RECORD OF T HE TRIBUNAL, INTER ALIA, TWO PAPER BOOKS OF THE ASSESSEE SPREAD OVER 1 6 AND 80 PAGES, RESPECTIVELY. THE LEARNED ASSESSEES REPRESENTATIVE (IN SHORT LEARNED AR) SUBMITTED THAT NEITHER THE ASSESSING OFFICER N OR THE LEARNED CIT(A) GRANTED DUE OPPORTUNITY OF HEARING TO THE AS SESSEE TO EXPLAIN HIS CASE AND STAND REGARDING THE IMPUGNED ADDITION OF RS.15,50,000/- MADE U/S 68 OF THE ACT (IN SHORT TH E ACT) IN RESPECT OF UNSECURED LOAN WITHOUT PROPER VERIFICATION OF TH E FACTS AND, SHRI OM PRAKASHKHANDELWAL ITA NO. 943/IND/2016 3 THEREFORE, THE DISALLOWANCE MADE BY THE ASSESSING O FFICER AND CONFIRMED BY THE LEARNED CIT(A) BEING ILLEGAL AND W RONG, REQUIRES TO BE DELETED. HOWEVER, ON SPECIFIC QUERY BY THE BENCH , THE LEARNED COUNSEL FOR THE ASSESSEE FAIRLY ACCEPTED THAT THE D OCUMENTS VIZ. COPY OF BANK STATEMENT OF THE ASSESSEE, COPY OF ACC OUNTS OF SHRI ASHISH KHANDELWAL AND SHRI LACHHIRAM PATEL AND COPY OF AFFIDAVIT OF SHRI ASHISH KHANDELWAL HAVE BEEN SUBMITTED FOR T HE FIRST TIME BEFORE THE TRIBUNAL AND THESE DOCUMENTS PLACED AT T HE ASSESSEES PAPER BOOK FILED ON 15.3.2017 HAVE NOT BEEN SUBMITT ED BEFORE THE AUTHORITIES BELOW. 4. REPLYING TO THE ABOVE, THE LEARNED DEPARTMENTAL REPRESENTATIVE (IN SHORT LEARNED DR) STRONGLY SUP PORTED THE ASSESSMENT ORDER AS WELL AS THE FIRST APPELLATE ORD ER AND VEHEMENTLY SUBMITTED THAT DESPITE SEVERAL OPPORTUNI TIES GIVEN TO THE ASSESSEE, THE ASSESSEE COULD NOT GIVE ANY SATIS FACTORY REPLY TO THE QUESTIONS TO ESTABLISH THE GENUINENESS OF THE T RANSACTIONS WHICH RESULTED INTO ADDITION U/S 68 OF THE ACT. THE LEARNED DR FURTHER SUBMITTED THAT SINCE THE ASSESSEE DID NOT S UBMIT COPIES OF SHRI OM PRAKASHKHANDELWAL ITA NO. 943/IND/2016 4 THESE DOCUMENTS BEFORE THE AUTHORITIES BELOW TO SUP PORT HIS CLAIM, THEREFORE, THE SAME CANNOT BE CONSIDERED BY THE TRI BUNAL AT THIS BELATED STAGE. THE LEARNED DR LASTLY POINTED OUT TH AT IF IT IS FOUND PROPER AND NECESSARY TO CONSIDER THE EVIDENCE FILED BY THE ASSESSEE TO EXPLAIN HIS STAND THEN THE DEPARTMENT HAS NO SER IOUS OBJECTION IF THE CASE IS RESTORED TO THE FILE OF THE ASSESSING O FFICER FOR FRESH ADJUDICATION. 5. ON CAREFUL CONSIDERATION OF THE ABOVE SUBMISSION S AND THE FIRST APPELLATE ORDER, IT IS VIVID THAT THE LEARNED CIT(A) HAS PASSED A CRYPTIC ORDER AND IN PARA 6.3 HE PROCEEDED TO DECID E THE APPEAL EX- PARTE TREATING THE SAME AS HEARD ON ORAL SUBMISSION S. FROM PARA 6.3 IT IS VIVID THAT THE LEARNED CIT(A) REJECTED TH E ADJOURNMENT APPLICATION OF THE APPELLANT WITHOUT ANY REASONING AND PROCEDURE TO DECIDE THE APPEAL IN A HASTY MANNER WHICH IS NOT PR OPER AND JUSTIFIED APPROACH FOR A QUASI-JUDICIAL REVENUE AUT HORITY. IN VIEW OF THE ABOVE FACTUAL POSITION AND THE SUBMISSIONS OF B OTH THE SIDES, WE ARE OF THE CONSIDERED VIEW THAT THE ASSESSEE COU LD NOT GET AN OPPORTUNITY TO EXPLAIN HIS CASE PROPERLY BY WAY OF SUPPORTING SHRI OM PRAKASHKHANDELWAL ITA NO. 943/IND/2016 5 DOCUMENTS AND OTHER RELEVANT SUBMISSIONS, WHICH IS A CLEAR VIOLATION OF PRINCIPLES OF NATURAL JUSTICE. IN OUR CONSIDERED VIEW, THE ENDS OF JUSTICE WOULD MEET IF THE ASSESSEE IS GIVEN DUE OPPORTUNITY OF HEARING TO EXPLAIN HIS CASE AND STAND ON THE ISS UE OF ADDITION U/S 68 OF THE ACT. THEREFORE, ON THE TOTALITY OF TH E FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND IT APPROPRIATE T O RESTORE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER AT THE A SSESSMENT STAGE AND WE ORDER ACCORDINGLY. THE ASSESSING OFFICER IS DIRE CTED TO PASS A FRESH ASSESSMENT ORDER AFTER AFFORDING DUE OPPORTUN ITY OF HEARING TO THE ASSESSEE AND WITHOUT BEING PREJUDICED WITH THE EARLIER ASSESSMENT ORDER AND THE IMPUGNED FIRST APPELLATE O RDER. ACCORDINGLY, GROUND NO. 1 OF THE APPEAL OF THE ASSE SSEE IS ALLOWED AND THE IMPUGNED ASSESSMENT ORDER AND THE FIRST APP ELLATE ORDER ARE SET ASIDE AND CONSEQUENTLY GROUND NO. 1 OF THE ASSESSEES APPEAL IS ALLOWED. 6. SINCE WE HAVE RESTORED THE ISSUE FOR FRAMING THE ASSESSMENT AFRESH TO THE FILE OF THE ASSESSING OFFICER, GROUND NO. 2 OF THE ASSESSEE ON MERITS IS NOT BEING ADJUDICATED UPON. SHRI OM PRAKASHKHANDELWAL ITA NO. 943/IND/2016 6 7. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATIST ICAL PURPOSES. THE ORDER HAS BEEN PRONOUNCED IN OPEN COURT ON 20 TH MARCH, 2017. SD/- SD/- &+ ( ( (O.P.MEENA) (C.M. GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER MARCH 20 TH 2017. DN/