ACIT, New Delhi V. Chander Kant Patel, New Delhi

MA 136/DEL/2011

• Counselvise Citation: [2012] 123 COUNSELVISE.COM (IT) 7740 (ITAT-DELHI)
• Duration Of Justice: 10 month(s) 12 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 23-03-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: misc
• Appeal Filed On: 11-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S MOHANTHY
• Assessee Lawyers: G R AGNIHOTRI
• Keywords: Unexplained investment; Peak credit; Additional evidence
• Section: 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH F NEW DELHI) BEFORE SHRI G.D. AGARWAL, HONBLE VICE-PRESIDENT AND SHRI RAJPAL YADAV, HONBLE JUDICIAL MEMBER MISCELLANEOUS APP. NO.136/DEL/2011 (IN ITA NOS. 143, 177, 144 & 176/DEL/2004) ASSESSMENT YEARS: 01.04.1989 TO 18.11.1999 ASSISTANT COMMISSIONER OF IT, VS. SH.CHANDER KANT CHANDUBHAI PATAL, CIRCLE 19(1), 6053-H, NAYA BANS, DELHI NEW DELHI. (APPLICANT) (RESPONDENT) APPLICANT BY: MS. S. MOHANTHY, DR RESPONDENT BY: SHRI GR AGNIHOTRI, ADV. DATE OF HEARING : 16.03.2012 DATE OF PRONOUNCEMENT : 23.03.2012 ORDER PER RAJPAL YADAV: JUDICIAL MEMBER THE PRESENT MISCELLANEOUS APPLICATION IS DIRECTED A T THE INSTANCE OF THE REVENUE POINTING OUT AN APPARENT ERROR IN THE O RDER OF THE ITAT DATED 30.04.2009 PASSED IN ITA NOS. 143 AND 177/DEL/2004. THE REVENUE PLEADED THAT THE ITAT HAS COMMITTED THREE APPARENT ERRORS. IT HAS DELETED THE ADDITION OF RS.4,11,265 WHICH WAS ADDED BY THE ASSE SSING OFFICER ON ACCOUNT OF UNEXPLAINED JEWELLERY FOUND IN SEARCH AN D SEIZURE OPERATION CARRIED OUT UNDER SEC. 132 OF THE INCOME-TAX ACT, 1 961. THE ITAT HAS NOT RECORDED ANY FINDING WHILE DELETING THIS ADDITION. SIMILARLY, THE ITAT HAS NOT RECORDED ANY FINDING ON THE ISSUE OF DELETION O F RS.75,000 BY THE 2 LEARNED CIT(APPEALS) OUT OF THE ADDITION OF RS.93,5 30. THE THIRD MISTAKE POINTED OUT BY THE REVENUE IN ITS MISCELLANEOUS APP LICATION IS THAT THE ITAT HAS NOT ADJUDICATED AN ISSUE OF DELETION OF RS.4,50 ,000 WHICH WAS ADDED BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED EXP ENSES INCURRED DURING THE MARRIAGES OF SON AND DAUGHTER OF THE ASSESSEE. IT HAS FURTHER POINTED OUT THAT ALL THESE THREE ISSUES WERE AGITATED BY THE RE VENUE IN MA NO. 251/DEL/2010. IT WAS DISMISSED ON 19.11.2010 WITHOU T RECORDING ANY FINDING. 2. LEARNED DR SUBMITTED THAT PERUSAL OF THE ITATS ORDER IN PARAGRAPH NO. 3 WHEREBY APPEAL OF THE REVENUE HAS BEEN DISMIS SED SHOWS THAT NO SPECIFIC FINDING HAS BEEN RECORDED BY THE ITAT ON T HESE ISSUES. SHE PRAYED THAT THESE ISSUES BE ADJUDICATED ON MERIT. ON THE O THER HAND, LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT EARLIER REVENUE MOV ED AN APPLICATION BEARING M.A.NO. 251/DEL/2010 WHICH WAS DISMISSED BY THE ITA T ON THE GROUND THAT THE APPLICATION DOES NOT DISCLOSE ANY APPARENT MIST AKE IN THE ORDER. HE DREW OUR ATTENTION TOWARDS THE ORDER OF THE ITAT DATED 1 9.11.2010. HE SUBMITTED THAT SECOND MISCELLANEOUS APPLICATION IS NOT MAINTA INABLE. HE RELIED UPON THE DECISION OF HON'BLE KERALA HIGH COURT IN THE CA SE OF CIT VS. KOTTAYAM VS. AISHWARIYA TRADING CO. LTD. REPORTED IN 192 TAX MAN 385. HE FURTHER SUBMITTED THAT THE ITAT HAS CONSIDERED ALL THE ISSU ES RAISED BY THE REVENUE 3 IN ITS APPEAL AND UPHELD THE ORDER OF THE LEARNED C IT(APPEALS). THE REVENUE CHALLENGED THE ORDER OF THE ITAT BEFORE THE HON'BLE HIGH COURT AND THE HON'BLE HIGH COURT HAS DISMISSED THE APPEAL OF THE REVENUE VIDE ITS ORDER DATED 30.3.2011. HE PLACED ON RECORD COPY OF THE HO N'BLE HIGH COURTS ORDER IN ITA NO. 1367 OF 2009. HE SUBMITTED THAT TH E ORDER OF THE ITAT MERGED WITH THE ORDER OF THE HON'BLE HIGH COURT AND PRESENT MISCELLANEOUS APPLICATION IS NOT MAINTAINABLE. 3. WE HAVE DULY CONSIDERED THE RIVAL CONTENTIONS AN D GONE THROUGH THE RECORD CAREFULLY. ON PERUSAL OF FORM NO. 36, INCLUD ING MEMORANDUM OF APPEALS FILED BY THE REVENUE IN IT(S.S) A. NO. 177/ DEL/2004, IT REVEALS THAT THE REVENUE HAS TAKEN GROUNDS A TO F, WHEREIN IT HA S CHALLENGED THE ACTION OF THE LEARNED CIT(APPEALS), NAMELY, (A) FOR ENTERTAIN ING ADDITIONAL EVIDENCE, (B) DELETION OF RS.8,10,270 ADDED BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED INVESTMENT, (C) DELETION OF RS.4,11,265 ADDED BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED INVESTMENT IN JEW ELLERY, (D) DELETION OF RS.75,000 OUT OF RS.93,530 ADDED BY THE ASSESSING O FFICER ON ACCOUNT OF UNEXPLAINED CASH FOUND DURING THE SEARCH; (E) DELET ION OF RS.4,50,000 ADDED BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED EXPENSES INCURRED ON THE MARRIAGES OF ASSESSEES SON AND DAUGHTER AND (F) DE LETION OF RS.8,15,994 WHICH WAS ADDED ON ACCOUNT OF EXCESS STOCK FOUND AT THE BUSINESS PREMISES 4 OF JAGDAMBA TOBACCO COMPANY. ALL THESE GROUNDS OF A PPEAL WERE TAKEN UP TOGETHER BY THE ITAT IN THE FOLLOWING FINDINGS:- 3. IN REPLY, THE LEARNED AR SUBMITTED THAT IT IS T RUE THAT THE EVIDENCES HAD BEEN PRODUCED BEFORE THE LEARNED CIT( APPEALS). EVEN THOUGH THE EVIDENCES HAD BEEN PRODUCED BEFORE THE L EARNED CIT(APPEALS), THE LEARNED CIT(APPEALS) HAD CALLED F OR A REMAND REPORT AS ALSO THAT LEARNED CIT(APPEALS) WAS RIGHT IN ADMITTING THE ADDITIONAL EVIDENCE BY INVOKING THE PROVISIONS OF R ULE 46A. A PERUSAL OF REMAND REPORTS ALSO CLEARLY SHOWS THAT T HE ASSESSING AUTHORITY HAD CONSIDERED ALL THE EVIDENCES AS FILED BY THE ASSESSEE BEFORE THE LEARNED CIT(APPEALS). THIS BEING SO, IT CANNOT BE SAID THAT FRESH EVIDENCES HAVE BEEN CONSIDERED BY THE LEARNED CIT(APPEALS) WITHOUT GIVING THE A.O. AN OPPORTUNITY TO EXAMINE T HE SAME. IT HAS FURTHER NOTICED THAT THE REVENUE HAS NOT BEEN ABLE TO POINT OUT ANY SPECIFIC DEFECT IN CONSIDERING THE EVIDENCES PRODUC ED BY THE ASSESSEE BEFORE THE LEARNED CIT(APPEALS) AND WHICH HAD ALSO BEEN FORWARDED TO THE ASSESSING AUTHORITY FOR HIS COMMENTS ON THE BASIS OF WHICH EVIDENCE, THE LEARNED CIT(APPEALS) HAD DELETED THE ADDITIONS. IN THESE CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE FI NDINGS OF THE LEARNED CIT(APPEALS) IN DELETING VARIOUS ADDITIONS ARE ON A CORRECT FOOTING AND AFTER GIVING ADEQUATE OPPORTUNITY TO TH E A.O. AND NO INTERFERENCE IS CALLED FOR. IN THESE CIRCUMSTANCES, THE APPEAL OF THE REVENUE STANDS DISMISSED. 5 4. AGAINST THIS ORDER OF THE ITAT, REVENUE WENT IN APPEAL BEFORE THE HON'BLE HIGH COURT. IT HAS CHALLENGED THE ORDER OF THE ITAT ONLY ON THREE ISSUES. THE HON'BLE HIGH COURT HAS FORMULATED FOLLO WING QUESTIONS OF LAW: 1. WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE P RESENT CASE, LEARNED ITAT HAS ERRED IN CONFIRMING THE ORDER OF T HE CIT(A) IN ADMITTING FRESH EVIDENCE UNDER RULE 46(A), WHEN THE ASSESSEE WAS NOT FULFILLING ANY CONDITIONS LAID DOW N FOR ADMISSION OF ADDITIONAL EVIDENCE UNDER THE RULE 46( A)? 2. WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE PRESE NT CASE, LEARNED ITAT HAS ERRED IN DELETING THE ADDITION OF RS.8,10,270 ON ACCOUNT OF UNEXPLAINED INVESTMENT IN SHARES AND DEBENTURES? 3. WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE PRESE NT CASE, LEARNED ITAT HAS ERRED IN DELETING THE ADDITION OF RS.5,31,170 MADE BY THE ACIT ON ACCOUNT OF PEAK CREDIT AS UNDIS CLOSED INCOME? 5. AFTER CONSIDERING THE ISSUES IN DETAIL, HON'BLE HIGH COURT HAS UPHELD THE ORDER OF THE ITAT. ON PERUSAL OF THE ITATS ORD ER, IT WOULD REVEAL THAT THE ITAT HAS NOT CONSIDERED ANY SINGLE ISSUE SPECIF ICALLY BUT CONSIDERED ALL THE ISSUES TOGETHER AND CONCUR WITH THE FINDINGS OF THE LEARNED CIT(APPEALS). IT IS THE INTERPRETATION OF THE REVEN UE THAT ITAT HAS NOT CONSIDERED CERTAIN ISSUES, OTHERWISE WHEN IT HAS CH ALLENGED THREE ISSUES BEFORE THE HON'BLE HIGH COURT EXTRACTED SUPRA, IT C OULD HAVE TAKEN REST OF THE THREE ISSUES ALSO. THERE IS NO DISTINCTION IN THE F INDINGS OF THE ITAT QUA THESE ISSUES WHICH WERE TAKEN UP TO THE HON'BLE HIG H COURT VIS--VIS THE 6 REMAINING THREE ISSUES PLEADED BEFORE US IN THE MIS CELLANEOUS APPLICATION AS WELL AS IN THE GROUNDS OF APPEAL. HON'BLE DELHI HIG H COURT IN THE CASE OF CIT VS. TONY ELECTRONICS REPORTED IN 320 ITR 378 AN D 185 TAXMAN 121 HAS HELD THAT ONCE AN APPEAL AGAINST AN ORDER PASSED BY THE AUTHORITY IS PREFERRED AND IS DECIDED BY THE APPELLATE AUTHORITY, ORDER OF THE SAID AUTHORITY MERGES INTO THE ORDER OF THE APPELLATE AUTHORITY AND ON TH AT MERGER, ORDER OF ORIGINAL AUTHORITY CEASES TO EXIST, NO RECTIFICATION WOULD P ERMISSIBLE. SIMILARLY, HON'BLE GUJARAT HIGH COURT IN THE CASE OF NIRMA IND USTRIES REPORTED IN 283 ITR 402 HAS HELD THAT ONCE AN APPEAL IS DISMISSED, THERE CANNOT BE ANY APPLICATION UNDER SEC. 254(2) OF THE ACT. LEARNED D R AT THE TIME OF HEARING RELIED UPON THE JUDGMENT OF THE HON'BLE SUPREME COU RT IN THE CASE OF HONDA SEAL POWER PRODUCT VS. CIT REPORTED IN 295 ITR 466. WE FIND THAT THE FACTS ARE QUITE DISTINGUISHABLE. IN THE PRESENT CASE, ITA T HAS ADJUDICATED THE ISSUE ON MERIT AND THE REVENUE ITSELF DID NOT CHOSE TO CH ALLENGE THE ORDER OF THE ITAT ON THESE THREE ISSUES WHICH ARE AGITATED IN TH E PRESENT MISCELLANEOUS APPLICATION. THEREFORE, THERE IS NO APPARENT ERROR IN THE ORDER OF THE ITAT. ACCORDINGLY, THE MISCELLANEOUS APPLICATION IS DISMI SSED. SD/- SD/- ( G.D. AGARWAL ) ( RAJPAL YADAV ) VICE-PRESIDENT JUDICIAL MEMBER DATED: 23 /03/2012 MOHAN LAL 7 COPY FORWARDED TO: 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR:ITAT ASSISTANT REGISTRAR