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Income Tax Appellate Tribunal, DELHI BENCH “SMC” NEW DELHI
Before: SHRI B.P. JAIN
PER B.P. JAIN, ACCOUNTANT MEMBER:
This appeal of the assessee arises from the order of ld. CIT(A)-19, New Delhi vide order dated 28.07.2015 for the A.Y. 2009-10. The assessee has raised the following grounds of appeal:-
1. That the Commissioner of Income-Tax (Appeals) had erred, both in law, as-well-as in facts of the case in up- holding addition of Rs.39,00,000/- ignoring, explanation of the Appellant.
2. That the Commissioner of Income-Tax (Appeals) had erred both in law as- well-as in facts of the case in not appreciating the explanation of the Appellant and drawing adverse inference from it with biased mind.
3. That the Commissioner of Income-Tax (Appeals) had erred both in law as- well-as in facts of the case in making presumptions at his own as to business activities of the Assessee. 4. The Appellant craves leave of this Hon’ble court to add, amend, delete or substitute any of the grounds, appeal at the time of arguments.
2. The brief facts of the case are that as per AIR information available, the assessee has deposited the sum of Rs. 39 lac in his saving bank account maintained with HDFC bank, Noida. The explanation for the source of the same was given by the assessee as he was a retail trader and all the sale of the assessee are in cash and out of cash sales, the assessee has deposited Rs. 39 lac in her bank account and copy of balance sheet and profit and loss account were submitted before the Assessing Officer. The Assessing Officer collected the information from Sh. Jai Prakash Associates Ltd. to which the assessee has made payment for purchase of flat and also from the report of the Inspector it was gathered that the Secretary of the Society was not even aware of any business activity at the business premises. However being not satisfied with the explanation of the assessee the Assessing Officer made an Page 2 of 5 addition of Rs. 39 lac to the income of the assessee u/s 69A of the Act.
The ld. CIT (A) confirmed the action of the Assessing Officer.
I have heard the rival contentions and perused the facts of the case. It was pointed out by the Dr. Rakesh Gupta, Advocate, the ld. Counsel for the assessee that the information by the Inspector was collected at the back of the assessee and the sale was not confronted to the assessee and therefore the assessment order passed is bad in law.
The ld. DR on the other hand relied upon the orders of both the authorities below.
There is no dispute that the assessee has filed the return u/s 44AF of the Act and has submitted that the deposits are out of cash sales which are declared in the balance sheet and profit and loss account submitted before both the authorities below. But at the same time any information collected at the back of the assessee and such information being used against the assessee without controverting the explanation given is bad in law and therefore passing of such order with such information collected at the back of the assessee, against the assessee without affording any opportunities of being heard is not justified. Therefore in my view, the order passed by the Assessing Officer is bad in law and is liable to be quashed. Therefore, in the circumstances and facts of the case all the grounds of appeal are allowed and the appeal of the assessee in is allowed.
In the result, the appeal of the assessee is allowed.
Pronounced in the open court on 07.03.2017. Sd/- (B.P. JAIN) ACCOUNTANT MEMBER Dated: 07.03.2017 Narender Copy forwarded to: 1) Appellant 2) Respondent 3) CIT 4) CIT (Appeals) 5) DR: ITAT ASSISTANT REGISTRAR
Date Draft dictated on 06.03.2017 Draft placed before author 06.03.2017 Draft proposed & placed before the second member Draft discussed/approved by Second Member.
Approved Draft comes to the Sr.PS/PS 7.3.2017 Kept for pronouncement on File sent to the Bench Clerk 7.3.2017 Date on which file goes to the AR Date on which file goes to the Head Clerk.
Date of dispatch of Order.