SH. MANOJ RANCHAL,BATALA vs. THE INCOME TAX OFFICER, BATALA

ITA 356/ASR/2014Status: DisposedITAT Amritsar30 December 2019AY 2009-104 pages

AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that the seized diary and additional evidence submitted by the assessee were not properly examined by the AO or the CIT(A). Therefore, in the interest of justice, the Tribunal set aside the order of the CIT(A) and remitted the issue back to the AO for a de-novo assessment.

What were the facts?

The assessee's appeal pertains to an addition of Rs. 53,85,723/- made by the Assessing Officer (AO) on account of unexplained investment in property. The addition was based on a report from a Valuer (AVO). The assessee contended that expenses and investments were recorded in a diary seized during a survey, and that substantial construction expenses were incurred in subsequent assessment years.

What were the issues?

Whether the addition on account of unexplained investment in property was justified without proper examination of seized documents and additional evidence provided by the assessee.

Which sections of the Income-tax Act were involved?

Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “DB”, BENCH AMRITSAR

Before: SHRI N.K. CHOUDHRY, JM & DR. A.L.SAINI, AM

Hearing: 28/11/2019Pronounced: 30/12/2019

आदेश / O R D E R Per Dr. A.L. Saini:

The captioned appeal filed by the assessee, pertaining to assessment year 2009- 10, is directed against the order passed by the Commissioner of Income Tax (Appeals), Amritsar [in short ‘CIT(A)’], in appeal No.357/11-12, which in turn arises out of an assessment order passed by the Assessing Officer u/s 143(3)of the Income Tax Act, 1961 (in short the ‘Act’) dated 27.12.2011.

Grounds of appeal raised by the assessee are as follows:

“1. That the Commissioner of Income Tax (Appeals), Amritsar has grossly erred in confirming the Additions of Rs.53,85,723/- made by 1TO, Ward 2(3), Batala on account of unexplained investment in property being house situated at 8-B, Greater Kailash, Batala based on report of AVO. 2. That the Commissioner of Income Tax (Appeals), Amritsar has grossly erred in confirming the action of ITO, Ward 2(3), Batala in making addition on account of Investment in house property on the basis of AVO’s Report without rejecting the books of the assessee.

ITA No.356/ASR/2014 AY: 2009-10 Sh. Manoj Ranchal.

That the Commissioner of Income Tax (Appeals), Amritsar has grossly erred in not appreciating the entries recorded on pages 16,18,19 & 20 of register, A-2, Impounded during survey proceeding u/s 133A on 9 March 2010.

That the Commissioner of Income Tax (Appeals), Amritsar has failed to appreciate that no substantial construction has taken place during the Assessment Year 2009-10 and assessee had incurred substantial amount during Assessment Year 2010-11,2011-12 and 2012-13.

That the Commissioner of Income Tax (Appeals), Amritsar has grossly erred in confirming the action of ITO, Ward 2(3), Batala in rejecting the objection raised by the assessee against AVO’s reports in a summary manner.

That the Commissioner of Income Tax (Appeals), Amritsar has grossly erred in confirming the action of ITO, Ward 2(3), Batala in rejecting the report of Shri. Kimti Lai Associate in a summery manner.”

At the outset itself, ld. Counsel for the assessee submitted before us that most of the expenses incurred and the investments made by the assessee were recorded in the diary ceased during the survey u/s 133A of the Act. The diary shows that the construction expenses were incurred during January, 2008 to May, 2008. The ld Counsel submitted before us a chart of brief facts and the events occurred from survey operation u/s 133A of the Act to assessment stage. The ld Counsel submitted before the Bench that some of the documents and evidences were not submitted during the appellate proceedings and assessment stage, therefore one more opportunities should be given to the assessee to plead his case before the ld CIT(A).The evidences, explanations and the documents furnished by the assessee before authorities below are as follows:

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ITA No.356/ASR/2014 AY: 2009-10 Sh. Manoj Ranchal.

On the other hand, the ld. DR for the Revenue vehemently submitted that evidences and details submitted by the assessee before the Bench in the form of paper book were not entirely examined neither by the ld CIT(A) nor by AO. That is, some of these details, evidences including the details of expenses and details of investments mentioned in the diary ceased during the survey were neither examined by ld CIT(A) nor by AO, therefore matter may be remitted back to the file of the ld CIT(A) for fresh adjudication.

We have heard both the parties and carefully gone through the submission put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the fact of the case including the findings of the ld CIT(A) and other materials available on record. We note that there is merit in the submissions of the ld. DR for the Revenue, as he has rightly pointed out that the diary ceased u/s 133A has not been properly examined by the ld CIT(A)/AO. Besides, the assessee had also submitted some additional evidences and explanations before the Bench. We note that the assessee had submitted the sequence of events and the documents and material found during survey u/s 133A of the Act and the reference to DVO etc in the form of paper book index, as noted above.

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ITA No.356/ASR/2014 AY: 2009-10 Sh. Manoj Ranchal. The ld Counsel has also pointed out that at serial No.11 of the above index in para 11 which assessee explains that Diary contains the details of expenses to the tune of �16 lakh whereas addition was made by AO to the tune of �57,00,000/-, thus, according to ld Counsel this aspect has been overlooked by the ld. AO. Therefore ld. Counsel for the assessee has prayed the Bench that the matter may be remanded back to the file of the ld AO. We note that the paper book filed by the assessee before us and the sequence of events given by the assessee along with the documents and explanations with proper reference of the page number of the paper book, which is mentioned in above para of our order, requires examination at the end of the AO. Therefore, in the interest of justice, we think it fit and proper that one more opportunity should be given to the assessee to plead his case before the AO. Therefore, we set aside the order of the ld. CIT(A) and remit the issue back to the file of the AO for de-novo assessment.

In the result, the appeal of the assessee is allowed for statistical purposes.

Order pronounced in the Court on 30.12.2019.

Sd/- Sd/- (N.K. CHOUDHRY) (A.L.SAINI) %या�यकसद�य / JUDICIAL MEMBER लेखासद�य / ACCOUNTANT MEMBER AmritsarAmritsar &दनांक/ Date: 30/12/2019 (BCG, PS) Copy of the order forwarded to: 1. Sh. Manoj Ranchal, S/o Sh. Madan Lal, 8-B, Greater Kailash, Batla. 2. Income Tax Officer, Ward-2(3),Batala. 3. C.I.T(A), Amritsar. 4. C.I.T.- concerned. 5. The Sr. DR, I.T.A.T., Amritsar.

True Order By Order Assistant Registrar ITAT, Amritsar Bench

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