SMT. HARINDER KAUR CHADHA, Jaipur V. INCOME TAX OFFICER, Jaipur

ITA 95/JPR/2018

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 7059 (ITAT-JAIPUR)
• Duration Of Justice: 2 year(s) 7 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-09-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2003-2004
• Appeal Filed On: 25-01-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: CHANCHAL MEENA CIT DHK
• Keywords: Opportunity of being heard; Principle of natural justice; Tangible material; Non compliance
• Section: 244A; 142(1); 143(1); 22; 147; 148; 144

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCH VC SMC, JAIPUR JH FOT; IKY JKWO] U;KF;D LNL; ,O A JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM VK;DJ VIHY LA-@ ITA NO. 95/JP/2018 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2003-04. SMT. HARINDER KAUR CHADHA B-61, YASH PATH, TILAK NAGAR, JAIPUR. CUKE VS. THE INCOME TAX OFFICER, WARD 6(1), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. AEYPC 0368 K VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : NONE JKTLO DH VKSJ LS@ REVENUE BY : MS CHANCHAL MEENA (ADDL. CIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 26.08.2020. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 07/09/2020. VKNS'K@ ORDER PER VIJAY PAL RAO, JM : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 30 TH NOVEMBER, 2017 OF LD. CIT (A)-2, JAIPUR FOR THE ASS ESSMENT YEAR 2003-04. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS :- 1.1. THE VERY ACTION TAKEN U/S 147 R/W 148 IS BAD IN LAW WITHOUT JURISDICTION AND BEING VOID AB-INITIO, THE SAME KINDLY BE QUASHE D. CONSEQUENTLY THE IMPUGNED ASSESSMENT FRAMED U/S 144/148 DATED 22 .10.2010 ALSO KINDLY BE QUASHED. 1.2. THE IMPUGNED ORDER U/S 144/148 DATED 22.10.201 0 IS BAD IN LAW AND ON FACTS OF THE CASE, FOR WANT OF ADEQUATE OPPORTUN ITY AND VARIOUS OTHER REASONS AND HENCE THE SAME KINDLY BE QUASHED. 2. THE IMPUGNED ADDITIONS AND DISALLOWANCES MADE IN THE ORDER U/S 144/148 DATED 22.10.2010 ARE BAD IN LAW AND ON FACT S OF THE CASE, FOR 2 ITA NO. 95/JP/2018 SMT. HARINDER KAUR CHADHA, JAIPUR. WANT OF JURISDICTION AND VARIOUS OTHER REASONS AND HENCE THE SAME KINDLY BE DELETED. 3. THE LD. CIT (A) ERRED IN LAW AS WELL AS ON THE F ACTS OF THE CASE IN DECIDING THE APPEAL EX PARTE WITHOUT AFFORDING ADEQ UATE AND REASONABLE OPPORTUNITY OF BEING HEARD. THE IMPUGNE D ORDER HAVING BEEN PASSED IN GROSS BREACH OF NATURAL JUSTICE, KIN DLY BE QUASHED. 4. RS. 5,74,488/-: THE LD. CIT (A) ERRED IN LAW AS WELL AS ON THE FACTS OF THE CASE IN MAKING ADDITION OF RS. 5,74,488/- ON AC COUNT OF UNDISCLOSED INCOME. THE ADDITION SO MADE AND CONFIR MED BY THE LD. CIT (A), IS CONTRARY TO THE PROVISIONS OF LAW AND F ACTS OF THE CASE HENCE, THE SAME KINDLY BE DELETED IN FULL. 5. THE LD. AO FURTHER ERRED IN LAW AS WELL AS ON TH E FACTS OF THE CASE IN CHARGING INTEREST U/S 234B, 234C & 234D OF THE ACT AND AS ALSO IN WITHDRAWING INTEREST U/S 244A OF THE ACT. THE APPEL LANT TOTALLY DENIES ITS LIABILITY OF CHARGING AND WITHDRAWAL OF ANY SUC H INTEREST. THE INTEREST SO CHARGED/WITHDRAWN, BEING CONTRARY TO TH E PROVISIONS OF LAW AND FACTS, KINDLY BE DELETED IN FULL. 6. THE APPELLANT PRAYS YOUR HONOUR INDULGENCES TO A DD, AMEND OR ALTER OF OR ANY OF THE GROUNDS OF THE APPEAL ON OR BEFORE TH E DATE OF HEARING. THE HEARING OF THE APPEAL IS CONCLUDED THROUGH VIDE O CONFERENCE DUE TO PREVAILING CONDITION OF COVID 19 PANDEMIC. 2. NOBODY HAS APPEARED ON BEHALF OF THE ASSESSEE DE SPITE THE FACT THAT THE ASSESSEE HAS BEEN SEEKING ADJOURNMENTS OF HEARING O F THE APPEAL SINCE JUNE, 2018 AS WELL AS THE NOTICE AND INTIMATION REGARDING THE VIDEO CONFERENCE HEARING WAS DULY SENT TO THE ASSESSEE. DESPITE BEST EFFORTS, T HE ASSESSEE CHOOSE NOT TO ATTEND THE HEARING. WE FURTHER NOTE THAT THE ASSESSMENT AS WELL AS THE IMPUGNED ORDER PASSED BY THE LD. CIT (A) ARE ALSO EX PARTE ORDERS DUE TO NON COMPLIANCE OF THE ASSESSEE TO THE VARIOUS NOTICES ISSUED. ACCORDINGL Y, WE PROPOSED TO HEAR AND DISPOSE OFF THE APPEAL EX PARTE. 3 ITA NO. 95/JP/2018 SMT. HARINDER KAUR CHADHA, JAIPUR. GROUNDS NO. 1, 2 & 3 ARE REGARDING VALIDITY OF REOP ENING OF THE ASSESSMENT AND VIOLATION OF PRINCIPLES OF NATURAL J USTICE. 3. THE ASSESSEE FILED HER RETURN OF INCOME ON 30 TH MARCH, 2004 DECLARING TOTAL INCOME OF RS. 1,10,340/-. THE RETURN WAS PROCESSED UNDER SECTION 143(1) ON 17.03.2005. THEREAFTER, THE AO RECEIVED THE INFORMA TION FROM THE ADIT INVESTIGATION JAIPUR THAT THE ASSESSEE HAS TAKEN A BOGUS ENTRY OF RS. 5,75,640/- ON 03.08.2002 THROUGH DD NO. 483342 DATED 30.07.2002. THE SAID A MOUNT WAS FOUND CREDITED IN THE BANK ACCOUNT OF THE ASSESSEE WITH STATE BANK OF INDIA, SANGANERI GATE JAIPUR. THE INFORMATION RECEIVED BY THE AO ALSO DISCLOSED T HE FACT THAT THE SAID ENTRY WAS PROVIDED BY JRD STOCKS THROUGH ITS BANK ACCOUNT WIT H STATE BANK OF PATIALA, DARYAGANJ, NEW DELHI. ACCORDINGLY, THE AO ISSUED N OTICE UNDER SECTION 148 ON 26 TH MARCH, 2010. THE ASSESSEE DID NOT RESPOND TO THE N OTICE UNDER SECTION 148 AS WELL AS THE NOTICE ISSUED UNDER SECTION 142(1) OF THE IT ACT. THE AO ALSO ISSUED A SHOW CAUSE NOTICE TO COMPLETE THE ASSESSMENT PROCEEDINGS UNDER SECTION 144 AND ASKED THE ASSESSEE TO FURNISH CERTAIN INFORMATION/DOCUMEN TS. IN COMPLIANCE TO THE SAID NOTICE, THE ASSESSEE ATTENDED THE HEARING THROUGH H ER A/R AND FILED LETTER DATED 21.10.2010. AFTER CONSIDERING THE ASSESSEES LETTE R, THE AO MADE THE ADDITION ON ACCOUNT OF UNDISCLOSED INCOME OF RS. 5,74,488/-. T HE SAID AMOUNT WAS CALCULATED AFTER DEDUCTING THE BANK CHARGES FROM THE DD AMOUNT CREDITED TO THE ACCOUNT OF THE ASSESSEE. THE ASSESSEE THOUGH CHALLENGED THE ACTIO N OF THE AO BEFORE THE LD. CIT (A) BUT NOBODY HAS ATTENDED THE HEARING BEFORE THE LD. CIT (A) DESPITE VARIOUS OPPORTUNITIES GIVEN. ACCORDINGLY, THE LD. CIT (A) HAS UPHELD THE VALIDITY OF REOPENING OF THE ASSESSMENT AS WELL AS THE ADDITION MADE BY T HE AO. 4 ITA NO. 95/JP/2018 SMT. HARINDER KAUR CHADHA, JAIPUR. 4. BEFORE US, THE LD. D/R HAS SUBMITTED THAT THERE WAS NO SCRUTINY ASSESSMENT AND SUBSEQUENTLY THE AO RECEIVED SPECIFIC INFORMATI ON ABOUT THE ACCOMMODATION ENTRY OF BOGUS LONG TERM CAPITAL GAIN ON PENNY STOC KS, THEREFORE, THE AO WAS HAVING A TANGIBLE MATERIAL TO FORM THE BELIEF THAT INCOME ASSESSABLE TO TAX HAS ESCAPED ASSESSMENT. SHE HAS RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW. 5. AT THE OUTSET, WE NOTE THAT IN REPLY TO NOTICE I SSUED BY THE AO UNDER SECTION 144 OF THE ACT, THE ASSESSEE FILED A LETTER DATED 2 1 ST OCTOBER, 2010 WHICH IS REPRODUCED BY THE AO IN THE ASSESSMENT ORDER AT PAG E 2 AS UNDER :- THE ASSESSEE IS NOT INVOLVED IN ANY DAY TO DAY BU SINESS ACTIVITIES HOWEVER DURING THE YEAR UNDER CONSIDERATION SHE DEA LT IN SOME SHARE TRANSACTIONS AND EARNED RS. 110340/- DURING THE YEA R. THE SALE CONSIDERATION OF THE SHARES WAS RS. 574488/- AS SHO WN IN HER BANK ACCOUNT BUT SINCE SHE DO NOT HAVE ANY EVIDENCE REGA RDING THIS SO THE ASSESSEE IS READY TO PAY TAX ON THE SALE CONSIDERAT ION AMOUNT. THUS IT IS CLEAR THAT THE ASSESSEE WAS NOT DOING AN Y REGULAR BUSINESS ACTIVITY OF PURCHASE AND SALE OF SHARES. THE ASSESSEE HAS ADMIT TED THE FACT THAT SHE DOES NOT HAVE ANY EVIDENCE REGARDING THE SAID TRANSACTION OF PURCHASE AND SALE AND, THEREFORE, ACCEPTED THE UNDISCLOSED INCOME AS PROPO SED BY THE AO IN THE REASONS RECORDED FOR REOPENING OF THE ASSESSMENT. FURTHER, THE INFORMATION RECEIVED BY THE AO IS SPECIFIC INFORMATION REGARDING THE TRANSACTIO N OF THE AMOUNT RECEIVED BY THE ASSESSEE THROUGH DD NO. 483342 DATED 30 TH JULY, 2002 FROM JRD STOCKS. THE SAID AMOUNT WAS CREDITED IN THE BANK ACCOUNT OF THE ASSE SSEE. THUS IN VIEW OF THESE FACTS AND CIRCUMSTANCES OF THE CASE, WHEN THE ASSES SEE HAS NOT DISCLOSED THE SAID 5 ITA NO. 95/JP/2018 SMT. HARINDER KAUR CHADHA, JAIPUR. TRANSACTION OF PURCHASE AND SALE OF SHARES IN HER R ETURN OF INCOME WHICH WAS ONLY PROCESSED UNDER SECTION 143(1) OF THE ACT AND SUBSE QUENTLY THE AO HAS RECEIVED THE INFORMATION AND FACTUAL DETAILS ABOUT THE ALLEGED B OGUS ENTRY OF RS. 5,75,640/- RECEIVED THROUGH DEMAND DRAFT DATED 30 TH JULY, 2002 PROVIDED BY JRD STOCKS, IT WOULD CONSTITUTE A TANGIBLE MATERIAL TO FORM THE BE LIEF THAT THE INCOME ASSESSABLE TO TAX HAS ESCAPED ASSESSMENT. HENCE WE DO NOT FIND AN Y SUBSTANCE IN THE OBJECTION RAISED BY THE ASSESSEE AGAINST THE REOPENING OF THE ASSESSMENT. 5.1. AS REGARDS THE PRINCIPLES OF NATURAL JUSTICE A ND APPROPRIATE OPPORTUNITY OF HEARING AFFORDED TO THE ASSESSEE, WE FIND THAT THE SSESSEE HAS NOT RESPONDED EVEN TO THE NOTICES UNDER SECTION 148 AS WELL AS UNDER S ECTION 142(1) AND ONLY WHEN THE AO HAS PROPOSED TO FRAME THE ASSESSMENT UNDER SECTI ON 144, THE ASSESSEE HAS FILED A LETTER DATED 21 ST OCTOBER, 2010. BASED ON THE SAID LETTER, THE AO H AS FRAMED THE ASSESSMENT AS THE ASSESSEE ADMITTED THAT THE SAID A MOUNT HAS ESCAPED ASSESSMENT AND TO PAY TAX ON THE SAME. BEFORE THE LD. CIT (A) NONE HAS APPEARED DESPITE MORE THAN 12 OPPORTUNITIES WERE GIVEN TO THE ASSESSEE. THUS IT IS APPARENT FROM THE RECORD THAT THE ASSESSEE WAS GIVEN MORE THAN SUFFIC IENT OPPORTUNITIES BY THE AUTHORITIES BELOW BUT THE ASSESSEE HERSELF DID NOT TAKEN ANY STEP TO APPEAR EITHER BEFORE THE AO OR BEFORE THE LD. CIT (A). EVEN BEFO RE THE TRIBUNAL THE ASSESSEES CONDUCT IS AVOIDING THE HEARING AND NOT TO PURSUE T HE PRESENT APPEAL. ACCORDINGLY, WE DO NOT FIND ANY MERIT OR SUBSTANCE IN THESE GROU NDS RAISED BY THE ASSESSEE. GROUNDS NO. 1 TO 3 ARE DISMISSED. GROUND NO. 4 IS REGARDING THE ADDITION MADE BY THE AO ON ACCOUNT OF UNDISCLOSED INCOME. 6 ITA NO. 95/JP/2018 SMT. HARINDER KAUR CHADHA, JAIPUR. 6. WE HAVE HEARD THE LD. D/R AND CAREFULLY PERUSED THE IMPUGNED ORDERS OF THE AUTHORITIES BELOW. AS WE HAVE ALREADY REPRODUCED T HE LETTER DATED 21 ST OCTOBER, 2010 FILED BY THE ASSESSEE WHEREBY THE ASSESSEE HAS ADMITTED THE FACT THAT SHE DOES NOT HAVE ANY EVIDENCE REGARDING THE TRANSACTIO N OF PURCHASE AND SALE OF SHARES AND CONSEQUENTLY SHE ACCEPTED TO PAY THE TAX ON THE SALE CONSIDERATION AMOUNT. THE AO HAS ACCORDINGLY MADE THE ADDITION OF THE SAI D AMOUNT AS UNDISCLOSED INCOME. NOTHING HAS BEEN EXPLAINED BY THE ASSESSEE EVEN BEFORE THE LD. CIT (A) OR BEFORE US AS TO WHY THE ADDITION MADE BY THE AO SHO ULD NOT HAVE BEEN MADE. THE LD. CIT (A) HAS DECIDED THIS ISSUE IN PARA 4.1 AND 4.2 AS UNDER :- 4.1. I HAVE PERUSED THE FACTS OF THE CASE, THE AS SESSMENT ORDER. AS PER INFORMATION AVAILABLE WITH THE ASSESSING OFFICE R, THE ASSESSEE TAKEN BOGUS ENTRY OF RS. 5,75,640/- THROUGH DD NO. 483342 DATED 30.07.2002. AFTER OBTAINING NECESSARY APPROVAL CASE WAS REOPENED U/S 148 OF THE I.T. ACT 1961. DURING THE ASSESSMENT PRO CEEDING ASSESSEE WAS ASKED TO PRODUCE THE NECESSARY DOCUMENTS. IN TH E REPLY LETTER DATED 21.10.2010 ASSESSEE STATED THAT :- THE ASSESSEE IS NOT INVOLVED IN ANY DAY TO DAY BU SINESS ACTIVITIES HOWEVER DURING THE YEAR UNDER CONSIDERAT ION SHE DEALT IN SOME SHARE TRANSACTIONS AND EARNED RS. 110340/- DURING THE YEAR. THE SALE CONSIDERATION OF THE SHARES WAS RS. 574488/- AS SHOWN IN HER BANK ACCOUN T BUT SINCE SHE DO NOT HAVE ANY EVIDENCE REGARDING TH IS SO THE ASSESSEE IS READY TO PAY TAX ON THE SALE CONSID ERATION AMOUNT. 4.2. AS PER THE ASSESSMENT ORDER ASSESSEE HAS ADMIT TED THE ABOVE TRANSACTION AS UNDISCLOSED INCOME. THE AO ASSESSED THE INCOME OF RS. 5,74,488/- CREDITED IN THE BANK ACCOUNT OF THE ASSE SSEE AS UNDISCLOSED 7 ITA NO. 95/JP/2018 SMT. HARINDER KAUR CHADHA, JAIPUR. INCOME. IN VIEW OF THE FACT THAT THE INCOME WAS OFF ERED AFTER ISSUANCE OF NOTICE U/S 148 BASED ON INFORMATION AVAILABLE WI TH THE AO, THE ADDITION MADE BY THE AO IS CONFIRMED. THE GROUND OF APPEAL IS DISMISSED. ACCORDINGLY, IN THE FACTS AND CIRCUMSTANCES OF THE CASE WHEN THE ASSESSEE HERSELF HAS ACCEPTED THE UNDISCLOSED INCOME, THEN WE DO NOT FIND ANY ERROR OR ILLEGALITY IN THE IMPUGNED ORDERS OF THE AUTHORITIES BELOW. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISS ED. ORDER IS PRONOUNCED IN THE OPEN COURT ON 07/09/2 020. SD/- SD/- ( FOE FLAG ;KNO ) ( FOT; IKY JKWO (VIKRAM SINGH YADAV ) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 07/09/2020. DAS/ VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- SMT. HARINDER KAUR CHADHA, JAIPU R. 2. THE RESPONDENT THE ITO WARD 6(1), JAIPUR. 3. THE CIT(A). 4. THE CIT, 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO. 95/JP/2018) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR 8 ITA NO. 95/JP/2018 SMT. HARINDER KAUR CHADHA, JAIPUR.