SMT. ASHA CHAURASIA,LUCKNOW V. .JOINT COMMISSIONER OF INCOME TAX (OSD), LUCKNOW

CO 67/LKW/2013

AI Insights

The case involves Shri Udai Chand Chaurasia, the appellant, contesting various additions made by the assessing officer and sustained by the CIT(A) under different heads such as unexplained investments and suppressed sales. The Tribunal had previously dismissed the Revenue's appeals and had not decided on some grounds of the Cross Objections due to oversight. Upon realization, the Tribunal recalled the matter for a fresh hearing on the undecided grounds. During the proceedings, no representation was made by the assessee, but the Departmental Representative suggested restoring the matters to the Assessing Officer, which was agreed upon by the Tribunal.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 45910 (ITAT-LUCKNOW)
• Appeal Type: Cross Objection
• Pronouncement Date: 18-12-2024
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MANU CHAURASIA
• Assessee Lawyers: AN
• Keywords: Opportunity of being heard; Unexplained investment; Search and seizure
• Section: 69B

Judgement Text

"C.O. Nos.67, 68 & 69/Lkw/2013 Assessment Years:2008-09 to 10-11 1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH ‘B’, LUCKNOW BEFORE SHRI KUL BHARAT, VICE PRESIDENT AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER C.O.Nos.67 to 69/Lkw/2013 (in I.T.A. Nos.690 to 692/Lkw/2013) Assessment Years: 2008-09 to 2010-11 Shri Udai Chand Chaurasia L/h Smt. Asha Chaurasia, 14, Datia House, Khurshed House, Lucknow. PAN:ABRPC4158M Vs. Jt. C.I.T.(OSD), Central Circle-2, Lucknow. (Appellant) (Respondent) O R D E R PER BENCH: (A) Vide consolidated order dated 21/10/2014 of Co-ordinate Bench of the ITAT, Lucknow, Revenue’s appeals vide I.T.A. Nos. 688 to 692/Lkw/2013 and assessee’s Cross Objection Nos. 65 to 69/Lkw/2013 corresponding to aforesaid appeals were disposed off. In the aforesaid order, the appeals filed by Revenue were dismissed. In the assessee’s Cross Objections, the following grounds were taken: Appellant by None Respondent by Shri Manu Chaurasia, CIT, D.R. Date of hearing 12/12/2024 Date of Pronouncement 18/12/2024 C.O. Nos.67, 68 & 69/Lkw/2013 Assessment Years:2008-09 to 10-11 2 C.O.No.67/Lkw/2013 “1. That the Ld. CIT(A) has erred in law and on the facts in approving the action of the assessing officer by sustaining the ad-Hoc addition for Rs.41,516/- under the Loading expenses. 2. That the Ld. CIT(A) has proceeded with the matter without appreciating the fact that no addition can be made as unexplained investment in Building under section 69B without specifically rejecting the books of account of the assessee and thereafter calling for the DVO's report under section 142A and placing reliance thereon. Such a course is permissible only when the DVO's report has been obtained by the AO, after rejecting the books of account of the assessee. This is the mandate of law as declared by the Hon'ble Apex Court. 3. That the Ld. CIT(A) is correct in observing that, where the difference in DVO's valuation and the amount disclosed by the assessee approximately 10%, there is no need to make any addition, without prejudice to the generality of the ground No. 2, supra and in the alternative. 4. The Ld. CIT(A) erred in law and on facts in sustaining the addition on account of alleged suppressed/unaccounted Sales merely on the basis of trade tax assessment order, whereas in case of Search and Seizure, it is the mandate of the courts, that independent findings have to be categorically recorded to sustain any addition under the income tax act. (Rs.16,24,690/-) 5. The Ld. CIT(A) erred in law and on facts in further causing an enhancement of the Total income of the assessee by an amount of Rs.21,80,385/-, without giving any notice of any such enhancement or giving any due and reasonable opportunity to the assessee to plead its case properly and hence such enhancement is against the principles of natural justice and deserves to be annulled.” C.O.No.68/Lkw/2013 “1. That the Ld. CIT(A) has erred in law and on the facts in approving the action of the assessing officer by sustaining the Ad-Hoc addition for Rs.1,00,198/- under the various heads of C.O. Nos.67, 68 & 69/Lkw/2013 Assessment Years:2008-09 to 10-11 3 expenses (Machine Expenses, Loading expenses, Misc. Expenses, Motor Car Expenses). 2. That the Ld. CIT(A) has proceeded with the matter without appreciating the fact that no addition can be made as unexplained investment in Building under section 69B without specifically rejecting the books of account of the assessee and thereafter calling for the DVO's report under section 142A and placing reliance thereon. Such a course is permissible only when the DVO's report has been obtained by the AO, after rejecting the books of account of the assessee. This is the mandate of law as declared by the Hon'ble Apex Court. 3. That the Ld. CIT(A) is correct in observing that, where the difference in DVO's valuation and the amount disclosed by the assessee is approximately 10%, there is no need to make any addition, without prejudice to the generality of the ground No.2, supra and in the alternative. 4. The Ld. CIT(A) erred in law and on facts in sustaining the addition on account of Stock of Talkatora Unit, without properly appreciating the facts of the case, wherein a mere accounting entry got omitted from inclusion in the books of the assessee and its consequential effect in the next year has also not been allowed. (Rs. 1,32,13,476/-).” C.O.No.69/Lkw/2013 “1. That the Ld. CIT(A) has proceeded with the matter without appreciating the fact that no addition can be made as unexplained investment in Building under section 69B without specifically rejecting the books of account of the assessee and thereafter calling for the DVO's report under section 142A and placing reliance thereon. Such a course is permissible only when the DVO's report has been obtained by the 10, after rejecting the books of account of the assessee. This is the mandate of law as declared by the Hon'ble Apex Court. 2. That the Ld. CIT(A) is correct in observing that, where the difference in DVO's valuation and the amount disclosed by the assessee is approximately 10%, there is no need to make any C.O. Nos.67, 68 & 69/Lkw/2013 Assessment Years:2008-09 to 10-11 4 addition, without prejudice to the generality of the ground No.1, supra and in the alternative. 3. The Ld. CIT(A) erred in law and on facts in holding that benefit of opening stock of Rs.1,32,13,476/- that was omitted from inclusion in the book results of A.Y. 09-10, as closing Stock and SURRENDERED by the assessee, CANNOT be treated as the opening stock of the current assessment year, without appreciating the fact that the AO has herself made an addition to this effect and such addition is sustained by the CIT(A) towards the Closing Stock of earlier year and hence the approach results in double addition that is impermissible in law. (Rs. 1,32,13,476/-) (A.1) However, in the aforesaid order dated 21/10/2014 of the Co-ordinate Bench of the ITAT, Lucknow, ground No. 5 of the Cross Objection in the assessee’s aforesaid Cross Objection No. 67/Lkw/2013, corresponding to I.T.A. No.690/Lkw/2013 was not decided. Similarly, in Cross Objection No.68/Lkw/2013, corresponding to I.T.A. No.691/Lkw/2013, Ground No. 4 of the Cross Objection filed by the assessee was not decided. Further, in Cross Objection No.69/Lkw/2013, corresponding to I.T.A. No.692/Lkw/2013, ground No. 3 of the Cross Objection was not decided. The assessee filed Miscellaneous Applications vide M.A. Nos. 6,7 & 8/Lkw/2017 with the request for recalling of the aforesaid order dated 21/10/2014 of the Co- ordinate Bench of the ITAT, Lucknow for hearing and decision on aforesaid grounds taken in aforesaid three Cross Objections filed by the assessee. Vide separate orders, each dated 11/12/2017, in aforesaid Miscellaneous Applications; the Cross Objections of the assessee were recalled for hearing on the aforesaid grounds in Cross Objections which were not decided in the aforesaid consolidated order dated 21/10/2024 of Co-ordinate Bench of the Lucknow. It is in this background that we heard these three Cross Objections on 12/12/2024. In the course of proceedings in Income Tax Appellate Tribunal, written submissions were filed by Shri Sumit Tewari, C.O. Nos.67, 68 & 69/Lkw/2013 Assessment Years:2008-09 to 10-11 5 Advocate from the assessee’s side stating “………it is respectfully submitted that subject to the kind pleasure of the Hon'ble Tribunal the matter, as has already been remanded by the Hon'ble Tribunal vide its Original Order dated 21/10/2024, on other issues be re-examined by the assessing authority and a pure consequential relief, as may be found admissible to the assessee under law, be granted.” (A.2) Hearings were fixed in these Cross Objections on 14/09/2023, 20/12/2023, 03/04/2024, 10/07/2024, 28/10/2024 and 05/12/2024 which were however adjourned either because there was no representation from assessee’s side or because requests for adjournment were made from either of the two sides. On 12/12/2024, when the matter came up for hearing, once again there was no representation from the assessee’s side. In the absence of any representation from the assessee’s side, we heard learned D.R. for Revenue. He submitted that ground No. 5 of the Cross Objection No. 67/Lkw/2013, ground No. 4 of Cross Objection No.68/Lkw/2013, and ground No. 3 of Cross Objection No.69/Lkw/2013 may also be restored back to the Assessing Officer for fresh decision in accordance with law and for taking an overall view of the case; as remaining grounds in aforesaid Cross Objections have already been restored back to the file of the Assessing Officer vide aforesaid order dated 21/10/2014 of the Co-ordinate Bench of the ITAT, Lucknow. The oral submissions made by learned D.R. for Revenue are in consonance with the written submissions filed from the assessee’s side which have been mentioned in foregoing paragraph (A.1) of this order. In view of the foregoing and in the specific facts and circumstances of the present case before us, the issues raised in ground No. 5 of the Cross Objection No. 67/Lkw/2013 and in ground No. 4 of Cross Objection No.68/Lkw/2013, and in ground No. 3 of Cross Objection C.O. Nos.67, 68 & 69/Lkw/2013 Assessment Years:2008-09 to 10-11 6 No.69/Lkw/2013 are restored back to Assessing Officer with the direction to pass fresh order on these specific issues in accordance with law after providing reasonable opportunity of being heard to the assessee. (B) In the result, all the Cross Objections are partly allowed for statistical purposes. (Order pronounced in the open court on 18/12/2024) Sd/. Sd/. (KUL BHARAT) (ANADEE NATH MISSHRA) Vice President Accountant Member Dated:18/12/2024 *Singh Copy of the order forwarded to : 1. The Appellant 2. The Respondent 3. Concerned CIT 4. The CIT(A) 5. D.R. ITAT, Lucknow Asstt. Registrar "