DINESH CHAUHAN,NEW DELHI vs. ITO, NEW DELHI

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ITA 3181/DEL/2017Status: DisposedITAT Delhi13 March 2020AY 2008-095 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the CIT(A) rejected additional evidence without cogent reasons. Therefore, the matter is remanded back to the CIT(A) to adjudicate the appeal on merits after providing the assessee an opportunity to present their case.

What were the facts?

The assessee's appeal against the CIT(A)'s order for AY 2014-15 is under consideration. The Assessing Officer made additions based on AIR information and bank account entries, which the assessee claimed were explained by business sales and capital introduction. The CIT(A) dismissed the appeal.

What were the issues?

Whether the CIT(A) erred in rejecting additional evidence without assigning reasons and whether the additions made by the AO were justified based on the available evidence.

Which sections of the Income-tax Act were involved?

Section 44AD,Section 80C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH: ‘I(2

Before: MS SUCHITRA KAMBLE, & SHRI PRASHANT MAHARISHI

Hearing: 04.03.2020

ORDER PER SUCHITRA KAMBLE, JM

This appeal is filed by the assessee against the order dated 18/03/2015 passed by CIT(A)- 15, Delhi for Assessment Year 2014-15.

2. The grounds of appeal are as under:-

“ 1. Assessing Authority order narrate first page and one para for non appearance and appearance of counsel but not submission of any documents and requiring from AO note sheet copy and adjournment of the case. The AIR information was furnished to the assessee . One Counsel Krishan Kant Roy UP filed Profit and Loss account and Balance sheet which was never required by the assessing authority. Sh. Ramesh Kumar Garg ,CA only sought adjournments and then Sh. K.K.Roy again appeared and asked the assessing

Authority the file details and finally proprietor appeared on 20.12.2010 and case was adjourned to 22.12.2010, but was given no sufficient time to file the required information. That the Counsel (s) of the assessee filed and submitted such documents which were not asked by the assessing authority as the return was filed u/s 44 AD which require no profit and loss account and balance sheet. The rest of the orders mention the narration of the said so submitted accounts which were never maintained. The Counsel of the assessee by putting "2" before the GTO made the GTO of the assessee as Rs.28,36,200/- for the complication to the assessee.

2.

Assessing authority due to the some good reason never relied on the said submissions but finally made the additions to the report of AIR information but never asked for the explanation to the saving account debit and credit entries. The Debit Credit entries are enclosed with explanations as ANNEXTURE. Further it is submitted that Deutsche Bank and Citi Bank are loan accounts having A/c No.200000719520019 and Card No.5425569450185012 respectively and as such no investment(s).

3.

That the AO Assessment order has not mentioned the said fact that the said Saving Bank Account No.115810002323 with Dena Bank is a joint Account and has in its assessment only tried to focus on cash deposits but by whom (Assessee and Co-Assessee) and what are other cheque deposits receipts and never tried to ask the assessee the documentary evidence thereof. His best judgment was only to make the additions of cash deposits only and to make additions of loan account(s) .Please find enclosed the narration of the joint Saving Bank account mentioned above in the ANNEXURE which clear the picture.

4.

Further the orders of the Commissioner of Income Tax (Appeal)XV also confirm the additions without giving justified reasons. Aggrieved Assessee ought to get justification for the additions, but to call it first thought and afterthought. The case of the Assessee at the appeal stage has been heard by three Commissioner(s) .The final Commissioner has not put the submissions to his predecessor(s) and never mentioned the submission(s) of Joint Saving Bank account in his orders which is the basic of dispute for additions.

5.

Deposits of more than Rs. 10.00 lacs require explanation but not straight forward additions to the Income .The Explanation to Saving Bank account No. 115810002323 with Dena Bank is as per the ANNEXURE which clearly shows the account is maintained by both the assessee husband and wife Sh.Dinesh Chauhan (PAN No. AADPC 9966E) AND Kavita Chauhan (PAN No. AFBPC 8089D) Andadditions of Cash Deposits are business entries (Deposit of sale proceeds of Rs.8,36,200) on various dates and introduction of Capital of Rs.5.00 lacs on 1.9.2007 by Kavita Chauhan (PAN No. AFBPC8089D).

PRAYER: KEEPING THE ABOVE SUBMISSION IN VIEW THE ADDITIONS TO THE INCOME MADE BY THE ASSESSING AUTHORITY AND CONFIRED BY THE APPELLATE COMMISSIONER MAY BE SET ASIDE AND SUCH OPPORTUNITY AS YOUR GOODSELF DEEM PROPER MAY BE GIVEN TO THE ASSESSEE TO PRESENT ITS CASE. IT IS PRAYED ACCORDINGLY.

3. The assessee filed its return relating to Assessment Year 2008-09 on 22/12/2010 which was filed u/s 44AD of the Income Tax Act, 1961. During the year under consideration, the assessee carried on a shop in the name of M/s My Mother Optics and operated his business joint account with wife Smt. Kavita Chauhan. During the year under consideration, the wife of the assessee deposited sale consideration of Rs.18,50,000/- in the joint account. The assessee deposited approximately Rs. 8,36,200/- sale proceeds on various dates i.e. on 1/4/2007 to 31/3/2008. The Assessing Officer made addition of Rs. 12,67,500/- as unexplained cash credit Rs. 2,74,154/- as unexplained investments and Rs. 25,764/- in respect of disallowance u/s 80C of the Income Tax Act, 1961.

4. Being aggrieved by the assessment order, the assessee filed appeal before the CIT(A). The CIT(A) dismissed the appeal of the assessee.

5. None appeared on behalf of the assessee and there is no adjournment application on behalf of the assessee. The notice has been served to the assessee. Therefore, we are taking the submissions of the assessee before the CIT(A) as well as before the Assessing Officer.

6.

The Ld. DR relied upon the assessment order and the order of the CIT(A).

7.

We have heard the Ld. DR and perused the material available on record. The CIT(A) rejected the additional evidence produced before the CIT(A) without assigning any cogent reason. Thus it will be appropriate to admit the additional evidence in this matter. Therefore, we are remanding back the matter to the file of the CIT(A) for adjudicating the appeal on merits. Needless to say, the assessee be given opportunity of giving by following principles of natural justice. The appeal of the assessee is partly allowed for statistical purpose.

8.

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

Order pronounced in the Open Court on 13th March, 2020.

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