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Income Tax Appellate Tribunal, DELHI BENCH: ‘A’ NEW DELHI
Before: SHRI B.P.JAIN & SHRI SUDHANSHU SRIVASTAVA
This appeal has been preferred by the Revenue against the order dated 30.12.2013 passed by the Ld. Commissioner of Income Tax (Appeals)-XVI, Delhi and pertains to assessment year 2005-06.
The brief facts of the case are that the assessee had purchased a property jointly with Mrs Sunita Devi and Mrs Meena Gupta for a total consideration of Rs. 1.68 crores and her share was 1/4th therein Assessment year 2013-14 amounting to Rs. 41,42,103/-. The assessment was completed under section 144 of the Income Tax Act, 1961 (hereinafter called “the Act”) on 28/12/2007 by holding the property purchase transaction of Rs. 1,68,00,000/- as unexplained investment on the basis of an AIR information received from the CIT (CIB) Delhi.
2.1 Aggrieved, the assessee preferred an appeal before the Ld. CIT (Appeals) who decided the issue in favour of the assessee. Aggrieved, the Department approached the ITAT and the ITAT restored the issue to the file of the Ld. CIT (Appeals) with a direction to re-decide the appeal after following the procedure laid down under Rule 46A of the Income Tax Rules, 1963. The appeal of the assessee was again decided by the Ld. CIT (Appeals) in favour of the assessee and now the Department has again approached the ITAT and has challenged the adjudication by the Ld. first appellate authority. The following grounds have been raised in this appeal:-
“On the facts and circumstances of the case and in law CIT(A) has erred in:- 1. Deleting the addition of Rs. 1,68,00,000/- made by the Assessing Officer on account of unexplained investment.
Assessment year 2013-14 2. Admitting the additional evidence as the same were not produced before the Assessing Officer in spite of giving sufficient opportunity under Rule 46A. 3. The appellant craves the right to add, alter or demand any ground of appeal.”
None was present for the assessee. However, looking into the facts of the case, we are proceeding to hear the appeal of the Department ex- parte qua the assessee.
The Ld. departmental representative assailed the order of the Ld. CIT (Appeals) and submitted that the assessee had entered into a transaction of purchase of property for a total consideration of Rs. 1.68 crores and based on AIR information, the AO had issued notice to the assessee which was not responded to by the assessee and, therefore, the AO was right in adding back the same to the income of the assessee. The Ld. departmental representative also submitted that the Ld. CIT (Appeals) had decided the issue in favour of the assessee without duly considering the observations of the AO and without following the procedure laid down under Rule 46A of the Income Tax Rules. Assessment year 2013-14 5. We have heard the Ld. departmental representative and have also perused the material on record as well as the impugned orders. It is seen that the ITAT Delhi Bench, in its earlier order, had restored the issue to the file of the Ld. CIT (Appeals) with a direction to re- decide the appeal after examining all the evidences produced by the assessee and also after following the procedure laid down under Rule 46A. Thereafter, the assessee filed written submissions along with documentary evidences before the Ld. CIT (Appeals) which were forwarded to the AO for his comments by the Ld. CIT (Appeals), vide letter dated 05/03/2012, and the same was responded to by the AO vide remand report dated 16/07/2012. Thereafter, the assessee also filed a rejoinder to the remand report vide letter dated 28/08/2012.
Thus, it is very much evident from the sequence of events that the Ld. CIT (Appeals) has followed the directions of the ITAT and has duly followed the procedure laid down under Rule 46A of the Income Tax Rules. It is settled law that the power of the first appellate authority is co-terminus with the authority of the AO and, therefore, he has the power to decide the issue if the AO fails to do so. It is seen that the assessee had submitted details of purchase of property and the mode Assessment year 2013-14 of payment towards her share in the said property before the Ld. CIT (Appeals) and had also explained the source of such payments made.
The same has duly been noted by the Ld. CIT (Appeals) in page 3 of the impugned order. It is seen that the additional evidences submitted were in the form of the ledger account of the assessee in the books of M/s Surinder Lal Sushil Kumar (a firm owned by the husband of the assessee and from whose account part payment of the property was made), copy of ITR of Sh. Vijay Kumar- the husband of the assessee, details of bank account deposits of the assessee for the year under consideration, etc. These documents were sent to the AO for his comments but the AO did not point out any inaccuracy or defect in the documents and simply stated that the assessee had not responded to the notice issued under section 142(1) of the Act at the time of assessment proceedings. The Ld. CIT (Appeals) has further observed that as per records, it was very much evident that the assessee had responded to the first notice issued by the AO and the reply was also counter-signed by the AO but the AO had chosen not to comment on it. The Ld. CIT (Appeals) has also noted that the assessee had also filed the return of income with Ward 25 (4) which Assessment year 2013-14 was not considered by the AO. The Ld. CIT (Appeals) has further noted that in the remand proceedings the AO never issued any notice nor required the assessee to submit any evidences before him and further that if the AO wanted to see and examine some further evidences, he should have given an opportunity to the assessee by issuing a fresh notice before submitting the remand report as nothing prevented him to call for such particulars. Thereafter, the Ld. CIT (Appeals) has duly noted that it was evident from the purchase deed dated 20/10/2004 that the assessee had only a part share in the entire property which was jointly purchased in the name of three persons and further that the assessee did not invest the entire amount of Rs. 1.68 crores and the actual quantum of investment by her was only Rs. 41,42,102/- which was made through withdrawals/advances taken by her from husband’s firm. The Ld. CIT (Appeals) has further noted that the withdrawals/advances from the husband’s firm, the credits in her bank accounts and the payments from the bank account were all in agreement with the ledger account, audited financials of the husband’s firm and the bank statements of the assessee. The Ld. CIT (Appeals), thereafter, proceeded to delete the addition. Thus, it is ITA No. 1068/Del/2017 Assessment year 2013-14 very much evident that the Ld. CIT (Appeals) has duly considered the evidences and has given the benefit of the same after giving due opportunity to the AO to rebut the same. However, the same was not done by the AO. Therefore, in view of the facts of the case, we find no reason to interfere with the findings of the Ld. CIT (Appeals) and we dismiss the grounds raised by the Department.
In the final result the appeal of the Department stands dismissed. Order is pronounced in the open court on 27th December, 2017.