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Income Tax Appellate Tribunal, DELHI BENCH “C”: NEW DELHI
Before: SHRI NARENDRA KUMAR BILLAIYA & SHRI KUL BHARAT
PER KUL BHARAT, JM:
This appeal, by the assessee, is directed against the order of the learned
Commissioner of Income-tax (Appeals)-35, New Delhi, dated 29.06.2018, pertaining to
the assessment year 2013-14. The assessee has raised following grounds of appeal,
The Ld. CIT(A) erred in law in confirming the additions made by the AO and passing the order without giving the assessee a proper and adequate opportunity of being heard in appellate proceedings. 2. The Ld. CIT (A) erred in law in confirming the additions made by the AO who passed an order without giving the assessee a proper opportunity of being heard.
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Hence, the order f the AO and the order of CIT(A) should be annulled. 3. The Ld. CIT (A) acted against the natural justice by not allowing adjournment to the assessee as desired by it thereby passing the order without allowing sufficient hearing t the assessee to represent its case, hence the order passed is liable to be annulled. 4. The Ld. CIT (A) erred in law and on facts in confirming the addition made by the AO u s 68 of the Act of Rs. 95,00,000/- in the hands of the assessee without appreciating the submissions made by the assessee company in the assessment proceedings as well as in the appellate proceedings and the facts of the case. Thus, the addition made should be deleted 5. The Ld. CIT (A) erred in law and on facts in upholding an addition of Rs. 2,57,500/- ms 41(1) of the Income tax Act for the amount payable by the assessee and reflecting under the head sundry creditors merely stating that the amount was appearing in the balance sheet since long and remained static. Thus, the addition made should be deleted. 6. The Ld. CIT (A) erred in law in confirming an addition of Rs. 72,50,000/- u/s 68 of the Act for the amount which was received by the assessee company from its director through proper banking channel without considering the submissions made by the assessee company in the assessment proceedings as well as in the appellate proceedings before CIT (A). Thus, the additions made by the AO should be deleted. 7. The appellant craves the leave to add, substitute, modify, delete or amend all or any ground of appeal either before or at the time of hearing. 2. At the outset learned counsel for the assessee submitted that the learned
CIT(Appeals) did not provide adequate and effective opportunity to the assessee. He
drew our attention to para 4.2 of the impugned order. He submitted that the only dispute
is with regard to the share capital money amounting to Rs. 95,00,000/- from Bengal
Media group. He contended that before the Assessing Officer the confirmation could not
be obtained as Ms. Manoranjana Singh was in judicial custody. He contended that in the
interest of fair play and to sub-serve the principles of natural justice, the impugned order
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may be set aside and the assessment may be restored to the file of the Assessing
Authority for de novo assessment.
On the contrary, learned DR opposed the submissions and submitted that the
learned CIT(Appeals) had provided adequate opportunity to the assessee.
We have heard rival contentions and perused the material available on record. We
find merit into the contention of the assessee that the concerned creditor namely Ms.
Manoranjana Singh , Director of the company, was under judicial custody. We find that
the learned CIT(Appeals) has already recorded this fact in the impugned order. For the
sake of clarity, the same is reproduced herein below:
“4.6.2. In the instant year, the appellant company received Rs. 72,50,000/- from Mrs. Manoranjana Singh, Director of the Company. The AO asked the appellant to furnish the details and purpose of the money received and also to furnish confirmation of the same and source of Investment made by Mrs. Manoranjana Singh. Notice u/s 133(6) was issued by the AO and in response, the appellant did not furnish any confirmation in this regard however, regarding the source of investment, the AR submitted that the Director (Ms. Manoranjana Sinh ) was at that time is in judicial Custody, Copy of loan account in the books of the Ms. Manoranjana Sinh and copy of Return along with statement of Affairs for A.Y. 2013-14, was submitted before the AO. The director was not paid any interest on this loan. The AO has observed that the appellant had failed to furnish any confirmation or to produce the party from whom the money has been received, and had also failed to substantiate the genuineness regarding , of transaction and source of investment of the party. The AO held that since the appellant company failed to explain genuineness regarding the source of investment by furnish confirmation or produce the party from whom money received, therefore, the transaction has not been explained within the meaning of section 68 of the Act. The AO held the amount of Rs.72,50,000/- as the undisclosed money of the appellant company and treated the same as income from undisclosed sources within the meaning of section 68 of the I.T. Act, 1961. During appellate proceedings, the appellant company has failed to provide bank statements etc. from the party and therefore, I find no reason to interfere with the AO's order on this issue. The appeal on this ground is dismissed”.
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Therefore, looking to the totality of the facts, the impugned order is hereby set
aside and the assessment is restored to the file of the Assessing Officer for de novo
assessment. The Assessing Officer would provide adequate opportunity of being heard to
the assessee. Grounds raised in this appeal are allowed for statistical purposes.
In the result, appeal of the assessee is allowed for statistical purposes.
Order pronounced in open court during the course of hearing on 22nd November, 2022.
Sd/- Sd/- (NARENDRA KUMAR BILLAIYA) (KUL BHARAT) ACCOUNTANT MEMBER JUDICIAL MEMBER *MP* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI