ARJUN SINGH vs. C I T KOTA

IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B.INCOME TAX APPEAL NO. 50 / 2003 ARJUN SINGH Versus C I T KOTA __________________________________________ For appellant : Mr. S.S. Hora For Respondents : Ms. Parinitoo Jain __________________________________________ HON'BLE MR. JUSTICE K.S. JHAVERI HON'BLE MR. JUSTICE DINESH MEHTA Judgment 06/12/2016 1. By way of this appeal, the assessee has challenged the judgment and order of Tribunal whereby the Tribunal has partly allowed the appeal of the assessee. 2. This Court while admitting the appeal on 21st July, 2008 has framed the following substantial questions of law: “(i) Whether the order of assessment made by the learned Assessing Officer u/s. 144 of the Act is illegal, unjust, and violative of the principles of natural justice, as no proper opportunity of being heard was provided to the appellant and in spite of request being made no photo copies of the impounded/seized book of accounts/documents were provided to him and additions were made on surmises and income has been computed by simply following summary order framed u/s. 132 (5) of the Act? (ii) Whether on the facts and in the circumstances of the case learned Income Tax Appellate Tribunal was justified in making the addition in respect of income from said 31 trucks @ 2000/- Per Truck Per Month, when no attempt was made by the Assessing Authorities to verify the ownership of the said trucks and the investment made in acquisition of the said trucks were neither examined nor questioned nor included in the hands of the appellant?

(2 of 4 ) [ITA-50/2003] 3. The facts of the case as recorded in the assessment order are that a search & seizure u/s 132 was carried out at the residential premises of the assessee on 09/01/95 and survey u/s 133 A was conducted simultaneously at Kota in the business premises of M/s Santosh Transportation Corporation and M/s Kota Transport Service. In the course of search it was noticed that he was deriving income from plying of trucks. In search cash of Rs. 65,000/- was seized as it was not explained. Gold ornaments and jewellery was also found in the possession. As the assessee was required to furnish the return of income but the return of income was not filed. 4. Accordingly notice u/s 148 was issued on 09/07/97 which was duly served on the assessee on 14/07/97 but the assessee failed to furnish the return of income in time allowed u/s 148. Notice u/s 142(1) was issued on 04/08/98. The assessee has sought adjournment for a month and accordingly time for a month was allowed but no compliance was made. Thereafter another notice was issued on 21/09/1998 fixing the case for hearing for 12/10/1998, but on this day none attended. Thereafter another notice u/s 142 (1) was issued on 16/07/1999 fixing the case for hearing on 26/07/1999. On 26/07/99, Shri Sharad Jain A/R attended the proceedings and sought adjournment the case was adjourned to 10/08/1999 and again sought adjournment and the case was adjourned to 20/09/1999 and thereafter adjourned to 05/10/1999 but on this day none attended. Thereafter again notice u/s 142(1)

(3 of 4 ) [ITA-50/2003] was issued on 24/01/2000 fixing the case for hearing on 31/01/2000 but on this day none attended nor any application for adjournment received. On 03/03/2000 a show cause notice was issued to the assessee proposing to make exparte asstt. u/s 144 if the assessee fails to comply the requirement of notice u/s 142(1). A notice u/s 142(1) was also issued on 03/03/2000 in which the assessee was requested to produce cash book, bank pass book and other related books of accounts for the period relevant to the asstt. year 95-96. The show cause notice and notice u/s 142(1) was duly served on the assessee on 03/03/2000 but on the day of hearing i.e. 10/03/2000 none attended the proceedings nor any application for adjournment filed. Thus a sufficient time and opportunities have been allowed to the assessee to file the return of income and to present his case but he failed to furnish the details and also the return of income. On account of non cooperative attitude of the assessee the AO completed the assessment ex parte on the basis of material available in record to the best of his judgment. 5. The main contention which has been raised by the counsel for the appellant is that he was not supplied with the documents relied upon by the AO and his books of accounts were in the custody of the Department. The contention of the assessee is that he could not produce the books of accounts and he has been assessed without giving proper opportunity of hearing and in violation of principles of natural justice. He has taken us to the order of the CIT (A) more particularly, from

(4 of 4 ) [ITA-50/2003] ground No.1, which reads as under: “Order passed u/s 144 is stated to be not proper and against principles of natural justice because copies of impounded/seized books of account and documents have not been provided to the appellant and further, income has been assessed on presumptions and without co-relating available material.” 6. From the order of the Tribunal also, we could not ascertain as to whether the documents were served or not. 6.1 In this view of the matter, without going into merits of the case, on the limited ground of violation of principles of natural justice, we are remitting back the matter to the Assessing Officer. The Assessing Officer is directed to pass order afresh after observing principles of natural justice and providing opportunity to the appellant to examine the documents or to provide copies, if asked for. 7. The matter will be examined independently by the Assessing Officer. The assessee will now appear before the Assessing Officer on 9th January, 2017 and the Assessing Officer will proceed further after supply of the documents to the appellant. The appeal stands disposed of. (DINESH MEHTA)J. (K.S.JHAVERI)J. /bm gandhi 7