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Income Tax Appellate Tribunal, DELHI BENCH: ‘SMC’ NEW DELHI
Before: SHRI H. S. SIDHU
This appeal is filed by assessee against the Order dated 02.2.2015 passed by the Ld.CIT(A)-7, Delhi relating to Assessment Year 2007-08 on the following grounds:-
1. That on the facts and in the circumstances of the case, the Hon'ble Commissioner of Income Tax (Appeal) has erred in the law as much as on the facts of the case by sustaining to unwarranted addition of Rs. 19,11,872/- made by the learned Assessing Officer u/sec. 2(22)( e) of the Income Tax Act, 1961.
2. That the Hon'ble Commissioner of Income Tax (Appeals) while sustaining the aforesaid unwarranted additions of Rs.19, 11 ,782/- has erred in law as much as on the facts of the case by not considering the written
submissions filed by the appellant before the Hon'ble Commissioner of Income Tax (Appeals) on 22.08.2014 where the factual position of the impugned transactions with M/s R. Cube International and M/s Perfect Paradise Emporium Pvt. Ltd. have been explained in details. In this manner, the Hon'ble Commissioner of Income Tax (Appeals) has passed the impugned order by ignoring these submissions, therefore, the orders passed in the case of the above appellant are not sustainable in law and void ab-initio.
That the Hon'ble Commissioner of Income Tax (Appeals) in para 6.2 of the appellate order has referred the letter dated 30th Oct, 2012 filed by the appellant addressed to the learned Income Tax Officer, Ward 14(2), New Delhi wherefrom she has quoted Para-4 of the said letter. This para has been misunderstood by her resulting thereby she has taken wrong conclusion and has erroneously upheld the additions of Rs.19,1l,782/- which is not only bad in law but against the principles of natural justice since the appellant was never confronted to this letter during the course of hearing of the appeal by the Hon'ble Commissioner of Income Tax (Appeals).
4. That the learned Hon'ble Commissioner of Income Tax (Appeals) has erroneously upheld the levy of penalty u/sec. 271 (l)( c) of the Act without appreciating that the alleged additions ofRs.19,11,782/- u/sec. 2(22)(e) is a deeming additions where no penalty is leviable u/sec. 271(l)(c) of the Act.
Facts narrated by the revenue authorities are not disputed by both the parties, hence, the same are not repeated here for the sake of brevity.
3. During the course of hearing, Ld. Counsel of the assessee has filed a Paper Book containing pages 1 to 53 containing the Written Submissions filed before the CIT(A) on 22.8.2014; copy of return of income of Sh. Rakesh Chhabra for the assessment year 2007-08; Copy of notice u/s. 148 of the Income Tax Act, 1961; Reply of notice u/s. 148 of the Income Tax Act, 1961 dated 23.4.2012; copy of reasons recorded for reopening the assessment of assessment year 2007-08 u/s. 148 of the Act; copy of notices u/s. 142(1) and u/s. 143(2) alongwith the detailed questionnaire dated 24.7.2012; reply dated 30.10.2012 filed by the assessee to the questionnaire dated 24.7.2012; copy of assessment order of M/s Perfect Paradise Emporium for assessment year 2007-08 dated 31.12.2009 u/s. 143(3) of the Act; copy of rejection letter rejecting the objection to assumption u/s. 147/148 dated 20.11.2012; copy of Audited balance sheet of M/s Perfect Paradise Emporium for the financial year ended 31st March, 2007; copy of balance sheet of M/s R Cube International for the period ended 31.3.2007 and also the copy of income tax return for the assessment 2007-08. He further stated that in para 6.2 of the appellate order Ld. CIT(A) has referred the letter dated 30th Oct, 2012 filed by the assessee addressed to the Income Tax Officer, Ward 14(2), New Delhi wherefrom she has quoted Para-4 of the said letter. This para has been misunderstood by her resulting thereby she has taken wrong conclusion and has erroneously upheld the additions of Rs.19,1l,782/- which is not only bad in law but against the principles of natural justice since the assessee was never confronted to this letter during the course of hearing of the appeal by the Ld. Commissioner of Income Tax (Appeals). In view of the above, he requested that the issues involved in the present appeal may be set aside to the file of the Ld. CIT(A) to decide the same afresh under the law, after giving adequate opportunity of being heard to the assessee.
On the contrary, Ld. DR opposed the request of the Ld. Counsel of the assessee and relied upon the orders of the authorities below. .
I heard both the parties and perused the records. I have gone through the order passed by the revenue authorities especially the impugned order as well as the Paper Book containing 1 to pages 53 containing the copy of Written Submissions filed before the CIT(A) on 22.8.2014; copy of return of income of Sh. Rakesh Chhabra for the assessment year 2007-08; Copy of notice u/s. 148 of the Income Tax Act, 1961; Reply of notice u/s. 148 of the Income Tax Act, 1961 dated 23.4.2012; copy of reasons recorded for reopening the assessment of assessment year 2007-08 u/s. 148 of the Act; copy of notices u/s. 142(1) and u/s. 143(2) alongwith the detailed questionnaire dated 24.7.2012; reply dated 30.10.2012 filed by the assessee to the questionnaire dated 24.7.2012; copy of assessment order of M/s Perfect Paradise Emporium for assessment year 2007-08 dated 31.12.2009 u/s. 143(3) of the Act; copy of rejection letter rejecting the objection to assumption u/s. 147/148 dated 20.11.2012; copy of Audited balance sheet of M/s Perfect Paradise Emporium for the financial year ended 31st March, 2007; copy of balance sheet of M/s R Cube International for the period ended 31.3.2007 and also the copy of income tax return for the assessment 2007-08. I find considerable cogency in the submissions of the ld. Counsel of the assessee that in para 6.2 of the appellate order Ld. CIT(A) has referred the letter dated 30th Oct, 2012 filed by the assessee addressed to the Income Tax Officer, Ward 14(2), New Delhi wherefrom she has quoted Para-4 of the said letter, misunderstood by her resulting thereby she has taken wrong conclusion and has erroneously upheld the additions of Rs.19,1l,782/- which is not only bad in law but against the principles of natural justice since the assessee was never confronted to this letter during the course of hearing of the appeal by the Ld. Commissioner of Income Tax (Appeals). In view of the above the said documents needs to be examined at the Ld. CIT(A) in order to decide the issues in dispute which he has not been considered.
Keeping in view of the facts and circumstances of the case, I am of the view that in this case the issues in dispute needs to be remitted back to the file of the Ld. CIT(A) to decide the same afresh, as per law.
Accordingly, the issues in dispute are set aside and restored back to the file of the Ld. CIT(A) to consider the issues in dispute afresh after giving adequate opportunity of being heard to the assessee.
In the result, the appeal filed by the assessee stands allowed for statistical purposes.