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Income Tax Appellate Tribunal, DELHI ‘A’ BENCH,
Before: SHRI BHAVNESH SAINI, & SHRI N.K. BILLAIYA
PER N.K. BILLAIYA, ACCOUNTANT MEMBER,
This appeal by the assessee is preferred against the order of the Commissioner of Income Tax [Appeals] - 1, New Delhi dated 05.12.2016 pertaining to Assessment Year 2009-10.
The sum and substance of the grievance of the assessee is that the CIT(A) erred in confirming the action of the Assessing Officer in reopening assessment completed u/s 143(3) of the Income tax Act, 1961 [hereinafter referred to as 'The Act' for short] thereby confirming the addition of Rs. 18,36,364/-.
None appeared on behalf of the assessee despite of service of notice. We decided to proceed ex parte.
Facts on record show that proceedings u/s 147 of the Act were initiated for the following reasons:
“Income tax Officer Ward 25(2), Kolkata, during the course of assessment proceedings for AY 2009-10 in the case of Shri Binod Kumar Jha has recorded the statement of Shri Binod Kumar Jha u/s 131 on 13/12/2011. During the course of statement, Shri Jha has stated that he had never executed any work for Ms Abhyudaya Housing Construction Pvt Ltd during the FY 2008-09 relevant to Assessment Year 2009-10. M/s Abhuydaya Housing Construction has paid a sum of Rs 18,36,364/- to Shri Jha as payment for sub-contractor whereas in statement, Shri Jha has slated that he never executed any work for Abhyudaya Housing Construction. The reply given by Shri Jha confirmed that he has merely provided a hawala entry…. "
During the course of assessment proceedings, the assessee was confronted with the relevant extracts of statement of Shri Binod Kumar Jha recorded on oath on 13.12.2011 by the ITO, Ward – 25(2), Kolkata and the same read as under:
“Q5 Kindly confirm whether you have ever heard of a company called Abhyudaya Housing & Construction Pvt, Ltd.,
A. No I have never heard such a name Q 6. Have you ever executed any civil contracts in your entire lifetime?
A. No Q 7. am showing you your P&L A/c for the A Y 2009-10 wherein you have shown a deemed income of 8% as applicable to contractors on the contract payments received from Abhyudaya Housing for which construction you have also claimed the TDS credit. In view of your above replies, kindly state whether you have merely provided a hawala entry to the said Abhyudaya Housing Pvt Ltd.
A. My job was to merely receive the cheques from Abhyudaya Housing & Construction Pvt Ltd, deposit the same in my Vijaya Bank account and after withdrawing the cash to hand over the same to Shri Rakesh Singh for which I was given a remuneration of Rs. 10 to 15 thousand as I do not remember the exact amount paid to me I confirm that I never executed any work for Abhydaya Housing & Construciton in Assessment Year 2009-10 in any other Assessment Year till date.
Q. 15 From all your above replies it is crystal clear that you were merely a cog in the when of a big syndicate of accommodation entry providers. In view of the same, honestly and truthfully state what was your real monetary gain from the role you played in the entire scheme of things.
A. I agree and confirm that I have clarified my role in the entire scheme of things in my statement herein above truthfully and honestly. My financial compulsions made me do what I have done and I honestly state that I have not earned more than Rs. 5 lacs till whatever time I was signing the blank cheques given to me by Shri Rakesh Singh. I agree that I have paid the taxes due on this income of Rs. S lacs for Assessment Year 2009-10 and produce the challan in a few days time.”
The assessee filed detailed reply regarding justification of transaction of Rs. 18,36,364/-. In its reply, the assessee referred to the affidavit of Shri Binod Kumar Jha wherein he has accepted the transaction and has also mentioned that he was under duress and huge tension and mental pressure at the time of answering the questions raised by the officers of the Income Tax Department regarding transaction with the assessee.
The Assessing Officer sought explanation from the assessee that once Shri Binod Kumar Jha has admitted in his statement, then why he is denying the contents of his statement by way of an affidavit.
On receiving no plausible reply and heavily relying on the statement of Shri Binod Kumar Jha, the Assessing Officer made an addition of Rs. 18,36,364/-.
The assessee carried the matter before the ld. CIT(A) but without any success.
Having heard the ld. DR at length, we have carefully perused the orders of the authorities below. There is no dispute that the assessment was reopened on the strength of statement of Shri Binod Kumar Jha recorded by the ITO, Ward 25(2), Kolkata. It is also not in dispute that subsequently, Shri Binod Kumar Jha filed an affidavit denying the contents of his statement.
In our understanding of facts, the entire quarrel revolves around the contradictory statement of Shri Binod Kumar Jha and on his affidavit. In the interest of justice and fair play, we deem it fit to restore the entire issue to the file of the Assessing Officer. The Assessing Officer is directed to once again examine Shri Binod Kumar Jha and allow the assessee to cross examine Shri Binod Kumar Jha and decide the issue afresh as per provisions of law.
In the result, the appeal filed by the assessee in is treated as allowed for statistical purposes.
The order is pronounced in the open court on 08.01.2020.