ITO WARD - 7(2), New Delhi V. DKS Sales (P) Limited, New Delhi

ITA 9887/DEL/2019

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 115986 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-03-2023
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 21-03-2023
• Assessment Year: 2014-2015
• Appeal Filed On: 30-12-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Commercial expediency; Set aside
• Section: 143(3); 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘B’ NEW DLEHI BEFORE SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER AND SHRI N.K. CHOUDHRY, JUDICIAL MEMBER ITA No. 9887/Del/2019 Assessment Year: 2014-15 Income-tax Officer, Ward 7(2), New Delhi VersuS DKS Sales (P) Limited, A-24, A-Block, Kirti Nagar, New Delhi PAN: AAFCD4730F (Appellant) (Respondent) Revenue by: Sh. Harpal Singh Kharab, Ld. Sr. DR Assessee by: None Date of hearing : 22 /03/2023 Date of order : 31/03/2023 ORDER PER N.K. CHOUDHRY, J.M. This appeal has been preferred by the Revenue Department against the order dated 24.10.2019, impugned herein, passed by the learned Commissioner of Income-tax (Appeals)-15, New Delhi (in short “Ld. Commissioner”), u/s. 250 of the Income-tax Act, 1961 (in short ‘the Act’) for the assessment year 2014-15. ITA No. 9887/Del/2019 2 2. The notices sent for the dates of hearing including for 22.03.2023 have been returned back by the postal department and the Registry do not have any address except as mentioned in Form No. 36, on which the notices have been sent, hence, we are constrained to decide this appeal as ex parte. 3. In the instant case, the Assessing Officer vide assessment order dated 16.12.2016 u/s. 143(3) of the Act computed the income of the Assessee at Rs.3,37,20,401/- instead of income of Rs.70,600/- as declared by the Assessee and made the following disallowances/ additions : (1) Rs.10,01,305/- on account of bank interest paid on overdraft limit. (2). Rs.1,20,00,000/- u/s. 68 of the Act on account of cash deposited in the bank during the year under consideration. (3). Rs.20,06,48,496/- u/s. 68 of the Act qua M/s Khushi Impex Sundry creditor of the Assessee. 4. Let us first deal the disallowance of Rs.10,01,305/- which was made on account of bank interest paid on overdraft limit on the ground that the amount borrowed for business activities was advanced as loans to the related party and no interest was charged from them and once the Assessee failed to show any commercial expediency and also failed to discharge its onus. The Assessee before the Assessing Officer vide letter dated 06.12.2016 claimed that ITA No. 9887/Del/2019 3 the advance was given for purchase of property, but the deal could not be settled being the property already mortgaged with the bank. The Assessee on being asked to produce the evidence of steps taken qua legal forum qua mortgage of property with the bank, the Assessee failed to substantiate its contention. Consequently the proportionate amount of Rs.10,01,305/- paid as interest to bank was held as inadmissible and added back in the income of the Assessee. 5. The Assessee before the ld. Commissioner filed some documents and written submissions, who without giving opportunity to the Assessing Officer and/or seeking any remand report, accepted such documents/submissions and on the basis of same, deleted the addition under consideration, which is challenged by the Revenue. 6. Similarly, the Assessing Officer also made the addition of Rs.1,20,00,000/- u/s. 68 of the Act against the cash deposit into the bank. On the basis of written submissions and documents filed by the Assessee during the course of appellate proceedings before the ld. Commissioner, who also deleted the said addition of Rs.1,20,00,000/- which is also under challenge. 7. Further, the Assessing Officer also made the addition of Rs.2,06,48,496/- u/s. 68 of the Act, payable to the sundry creditor, on the ground that genuineness and the creditworthiness of the creditor was not established despite ITA No. 9887/Del/2019 4 affording numerous opportunities. The Assessee before the ld. Commissioner with regard to this addition as well, filed written submission/documents on the basis of which the ld. Commissioner deleted the said addition, which is also under challenge. 8. We have given thoughtful consideration to the peculiar facts and circumstances and are in concurrence with the contention of the ld. DR that the ld. Commissioner wrongly considered the written submissions/documents filed by the Assessee during the appellate proceedings, without providing any opportunity and/or seeking any remand report from the Assessing Officer, which was very much essential, specifically under the peculiar circumstances, wherein the Assessee before the Assessing Officer and the ld. Commissioner raised the claims entirely on different footings/facts and therefore, the order is un-sustainable. Consequently, we are inclined to set aside the impugned order and to remand the instant case to the file of the ld. Commissioner for decision afresh, suffice to say, by affording reasonable opportunity of being heard to the Assessee and by seeking remand report and/or giving opportunity to the Assessing Officer and to pass the order afresh. Consequently, the appeal filed by the Revenue Department stands allowed for statistical purposes. ITA No. 9887/Del/2019 5 9. In the result, the appeal filed by the Revenue Department stands allowed for statistical purposes. Order pronounced in the open court on 31.03.2023 Sd/- Sd/- (ANIL CHATURVEDI) (N.K. CHOUDHRY) ACCOUNTANT MEMBER JUDICIAL MEMBER *aks/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT Assistant Registrar ITAT New Delhi Draft dictated 28.03.2023 Draft placed before author 29.03.2023 Approved Draft comes to the Sr.PS/PS Order si gned and pronounced on Date of uploading on the website File sent to the Bench Clerk Date on which file goes to the AR Date on which file goes to the Head Clerk. Date of dispatch of Order.