Sh. Romesh Sharma, New Delhi V. DCIT, New Delhi

ITSSA 2/DEL/2017

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 9941 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 5 month(s) 21 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 27-07-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: misc
• Appeal Filed On: 06-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUSHMA SINGH
• Assessee Lawyers: PRADEEP JINDAL
• Keywords: Document seized; Opportunity of being heard; Valuation report; Documents seized
• Section: 158BC; 13; 22; 131

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES F : DELHI [THROUGH VIDEO CONFERENCING] BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER AND SHRI AMIT SHUKLA, JUDICIAL MEMBER I.T. (S.S).A.NO.2/DEL./2017 BLOCK PERIOD 1989-1990 TO 1999-2000 [TILL 20.10.1998 THE DATE OF SEARCH). SHRI ROMESH SHARMA, C-30, MAYFAIR GARDEN, NEW DELHI. PAN ABPPS7882N VS. THE DCIT, CIRCLE 32 (1), NEW DELHI. (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI PRADEEP JINDAL, C.A. AND SHRI PRATEEK MITTAL, C.A. FOR REVENUE : SMT. SUSHMA SINGH, CIT-DR DATE OF HEARING : 22 . 07 .20 21 DATE OF PRONOUNCEMENT : 27 . 07 .20 2 1 ORDER PER R.K. PANDA, A.M. THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 27.01.2006 OF THE LD. CIT(A)-XI, NEW DELHI, RELATING TO THE BLOCK PERIOD 1989-1990 TO TILL 20.10.1998 (THE DATE OF SEARCH). 2 IT (SS) A.NO.2/DEL./2017 SHRI ROMESH SHARMA, NEW DELHI. 2. THE FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSEE IS AN INDIVIDUAL. A SEARCH UNDER SECTION 132(1) OF THE I.T. ACT, 1961 WAS CONDUCTED ON 27.04.1989. ARREAR DEMAND AMOUNTING TO RS.1.16 CRORES, EXCLUDING INTEREST UNDER SECTION 220(2) WAS PENDING AGAINST THE ASSESSEE AND PROSECUTION PROCEEDINGS UNDER SECTION 276-C(2) OF THE I.T. ACT, 1961 FOR THE A.YS. 1987-1988, 1988-1989 AND 1989- 1990 WERE IN PROGRESS BEFORE THE ADDL. METROPOLITAN MAGISTRATE, TIS HAZARI, NEW DELHI. SUBSEQUENTLY, THERE WAS A SEARCH BY THE CBI, DELHI POLICE AND INCOME TAX DEPARTMENT AT THE RESIDENTIAL AND BUSINESS PREMISES OF THE ASSESSEE ON 20.10.1998. AS PER THE ASSESSMENT ORDER, THE ASSESSEE WAS DETAINED IN TIHAR JAIL SUBSEQUENT TO SEARCH AND CONTINUES TO BE UNDER DETENTION SINCE 1998 AND MORE THAN 20 CRIMINAL CASES ARE PENDING IN THE COURT AGAINST HIM. ALTHOUGH HE WAS GRANTED BAIL IN SOME OF THE CASES, BUT, HE WAS NOT GRANTED BAIL IN CERTAIN OTHER CASES. SUBSEQUENTLY, THE A.O. ISSUED NOTICE UNDER SECTION 158BC OF THE I.T. ACT ON 04.05.2000 WHICH ACCORDING TO HIM WAS DULY SERVED UPON THE ASSESSEE ON 05.05.2000. SINCE SHRI 3 IT (SS) A.NO.2/DEL./2017 SHRI ROMESH SHARMA, NEW DELHI. ROMESH SHARMA SIGNED ON THE COVERING LETTER OF THE NOTICE UNDER SECTION 158BC AND DID NOT RETURN OFFICE COPY OF NOTICE UNDER SECTION 158BC, ANOTHER NOTICE UNDER SECTION 158BC WAS AGAIN SERVED ON HIM ON 10.05.2000 IN TIHAR JAIL IN THE PRESENCE OF JAIL AUTHORITIES BY THE INSPECTOR OF INCOME TAX AND HIS SIGNATURES WERE TAKEN ON THE OFFICE COPY OF THE NOTICE. THE ASSESSEE WAS REQUIRED TO FILE RETURN FOR THE BLOCK PERIOD WITHIN 20 DAYS OF SERVICE OF THE AFORESAID NOTICE, BUT, DESPITE PROPER SERVICE OF THE NOTICE, NO RETURN WAS FILED BY THE ASSESSEE. 2.1. SUBSEQUENTLY, THE A.O. ISSUED A DETAILED QUESTIONNAIRE ALONG WITH SUMMONS UNDER SECTION 131 OF THE I.T. ACT, 1961 WHICH WAS SERVED UPON THE ASSESSEE IN TIHAR JAIL BY THE INSPECTOR OF INCOME TAX ON 26.06.2000. DATE FIXED FOR COMPLIANCE WAS 10.07.2000. HOWEVER, ON THE SAID DATE NOBODY APPEARED. SUBSEQUENTLY ON 10.09.2001 ONE MR. SUMAN SINGHAL, C.A. APPEARED AND REQUESTED FOR PHOTO COPIES OF SEIZED DOCUMENTS. ON 12.09.2001 ONE SHRI RAHUL, C.A. ATTENDED WHO WAS REQUESTED TO FILE VALUATION REPORTS OF VARIOUS MOVABLE AND IMMOVABLE PROPERTIES AND THE DETAILS 4 IT (SS) A.NO.2/DEL./2017 SHRI ROMESH SHARMA, NEW DELHI. AS REQUIRED. ON 05.11.2001 THE AUTHORISED REPRESENTATIVES WHO ATTENDED BEFORE THE A.O, EXPRESSED THEIR INABILITY IN FILING THE RETURN OF INCOME AND FINAL REPLY TO THE QUESTIONNAIRE DATED 21.06.2000. SUBSEQUENTLY, THE A.O. ISSUED ANOTHER QUESTIONNAIRE TO THE ASSESSEE ON 15.04.2002 WHICH WAS SERVED ON THE ASSESSEE ON 16.04.2002 BY THE INSPECTOR OF THE INCOME TAX DEPARTMENT AT TIHAR JAIL. SINCE THERE WAS NO COMPLIANCE FROM THE SIDE OF THE ASSESSEE, THE A.O. COMPLETED THE ASSESSMENT UNDER SECTION 158BC/144 OF THE I.T. ACT, 1961, DETERMINING THE TOTAL INCOME OF THE ASSESSEE AT RS.62,04,38,020/-. 2.1. IN APPEAL, THE LD. CIT(A) IN THE EX-PARTE ORDER PASSED BY HIM, DISMISSED THE APPEAL FILED BY THE ASSESSEE. 3. AGGRIEVED WITH SUCH ORDER OF THE LD. CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL BY RAISING THE FOLLOWING GROUNDS : 5 IT (SS) A.NO.2/DEL./2017 SHRI ROMESH SHARMA, NEW DELHI. 6 IT (SS) A.NO.2/DEL./2017 SHRI ROMESH SHARMA, NEW DELHI. 7 IT (SS) A.NO.2/DEL./2017 SHRI ROMESH SHARMA, NEW DELHI. 8 IT (SS) A.NO.2/DEL./2017 SHRI ROMESH SHARMA, NEW DELHI. 9 IT (SS) A.NO.2/DEL./2017 SHRI ROMESH SHARMA, NEW DELHI. 10 IT (SS) A.NO.2/DEL./2017 SHRI ROMESH SHARMA, NEW DELHI. 11 IT (SS) A.NO.2/DEL./2017 SHRI ROMESH SHARMA, NEW DELHI. 4. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE WAS IN TIHAR JAIL FROM 29.10.1998 TILL 20.10.2012. HE SUBMITTED THAT THE A.O. IN THE INSTANT CASE HAS PASSED THE ASSESSMENT ORDER ON 29.04.2002 UNDER SECTION 158BC/144 OF THE I.T. ACT, 1961, WHEREAS, THE LD. CIT(A) PASSED THE EX-PARTE ORDER ON 27.01.2006. HE 12 IT (SS) A.NO.2/DEL./2017 SHRI ROMESH SHARMA, NEW DELHI. SUBMITTED THAT SINCE THE ASSESSEE WAS IN JAIL AND UNDER TREMENDOUS MENTAL PRESSURE, HE WAS NOT IN A POSITION TO COMPLY TO THE STATUTORY NOTICES ISSUED BY THE A.O. AS WELL AS THE LD. CIT(A). HE SUBMITTED THAT IN THE INTEREST OF JUSTICE THE ASSESSEE SHOULD BE GIVEN ONE MORE OPPORTUNITY TO SUBSTANTIATE HIS CASE BEFORE THE A.O. BY SETTING ASIDE THE MATTER TO THE FILE OF A.O. 5. THE LD. CIT-DR ON THE OTHER HAND, STRONGLY OPPOSED THE ARGUMENTS ADVANCED BY THE LEARNED COUNSEL FOR THE ASSESSEE. SHE SUBMITTED THAT THE ASSESSEE COULD HAVE ENGAGED SOME LAWYER AND HE IS NOT REQUIRED TO APPEAR PERSONALLY BEFORE THE A.O. SHE ACCORDINGLY SUBMITTED THAT THE ORDER OF THE LD. CIT(A) BE UPHELD AND THE GROUNDS RAISED BY THE ASSESSEE BE DISMISSED. 6. WE HAVE HEARD THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES, PERUSED THE ORDERS OF THE A.O. AND THE LD. CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. AS MENTIONED EARLIER THE ASSESSEE WAS IN TIHAR JAIL FROM 29.10.1998 TILL 20.10.2012, DURING WHICH PERIOD, THE A.O. 13 IT (SS) A.NO.2/DEL./2017 SHRI ROMESH SHARMA, NEW DELHI. AS WELL AS THE LD. CIT(A) HAVE PASSED EX-PARTE ORDERS. SINCE THE ASSESSEE WAS IN JAIL, IT WAS NOT POSSIBLE ON HIS PART TO APPEAR BEFORE THE A.O. NOR HE WAS IN A POSITION TO EXPLAIN HIS CASE THROUGH HIS LAWYER DUE TO TREMENDOUS MENTAL PRESSURE AND SURROUNDING CIRCUMSTANCES. CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN THE INTEREST OF JUSTICE, WE DEEM IT FIT AND PROPER TO RESTORE THE ISSUE TO THE FILE OF A.O. WITH A DIRECTION TO GIVE REASONABLE, OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND DECIDE THE ISSUE AS PER FACT AND LAW. WE HOLD AND DIRECT ACCORDINGLY. THE GROUNDS RAISED BY THE ASSESSEE ARE ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 27.07.2021. SD/- SD/- (AMIT SHUKLA) (R.K. PANDA) JUDICIAL MEMBER ACCOUNTANT MEMBER DELHI, DATED 27 TH JULY, 2021 VBP/- 14 IT (SS) A.NO.2/DEL./2017 SHRI ROMESH SHARMA, NEW DELHI. COPY TO 1. THE APP ELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT F BENCH, DELHI 6. GUARD FILE. // BY ORDER // ASSISTANT REGISTRAR : ITAT DELHI BENCHES : DELHI.