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Income Tax Appellate Tribunal, DELHI BENCH: ‘SMC-II’ NEW DELHI
Before: SMT DIVA SINGH
ORDER The present appeal has been filed by the assessee assailing the correctness of the order dated 06.02.2016 of CIT(A), Ghaziabad pertaining to 2011–12 assessment year on the following grounds:-
1. “That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. AO in making disallowance of claims of Rs.5,55,143 under section 10 and Rs.2,500/- under section 16(iii) of the Income Tax Act, 1961, respectively, completely ignoring the fact that entire claim under Section 10 and 16(iii) were based on the requisite Form No. 16 issued by the employer and that too without giving adequate opportunity of hearing .
That in any case and in any view of the matter, action of Ld. CIT(A) in confirming the action of Ld. AO in making disallowance of claims of Rs.5,55,143 under section 10 and Rs.2,500/- under section 16(iii) of the Income Tax Act, 1961, respectively is bad in law and against the facts and circumstances of the case. 3. That in any case and in any view of the matter, action of Ld. CIT(A) in confirming the additions/disallowance and passing the impugned assessment order being contrary to law and facts and without providing adequate opportunity of hearing and without considering the principles of natural justice and the same is not sustainable on various legal and factual grounds. 4. That having regards to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in not reversing the action of the Ld. AO in charging interest u/s 234 A of the Income Tax Act, 1961. 5. That having regards to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in not reversing the action of the Ld. AO in charging interest u/s 234B of the Income Tax Act, 1961. 6. That having regards to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in not reversing the action of the Ld. AO in charging interest u/s 234C of the Income Tax Act, 1961. 7. That having regards to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in not reversing the action of the Ld. AO in charging interest u/s 234D of the Income Tax Act, 1961. 8. That the appellant craves leave to add, modify, amend or delete any of the grounds of appeal at the time of hearing and all the above grounds are without prejudice to each other.”
I.T.A .No.-2734/Del/2016 Vikas Jain vs DCIT
Page 2 of 3 2. The relevant facts of the case are that the assessee who is an individual returned an income of Rs.34,62,360/- from (a) salary and (b) other sources being interest from bank. The return was picked up for scrutiny after issuance of notice u/s 143(2) and 142(1) on 22.08.2013; 08.07.2013; 10.10.2013; and 13.11.2013 as the AO noted that as per Form No.16A, the assessee had received salary from two employers during the year. Whereas salary for 10 months was claimed to have been received from K.P.H.Dream Cricket P.Ltd.; for two months, it had been received from JSW Steel Limited. The AO required the assessee to explain the exemption claimed u/s 10 of the I.T.Act, 1961. IN the absence of any evidence from the assessee, the AO made additions as a result of which the total income of the assessee was computed at Rs.40,20,010/-. The assessee challenged these additions made by way of a disallowance of the exemption before the CIT(A). The additions made, were sustained holding as under:-
Grounds of appeal
no.1 & 2. “Having considered facts and circumstances of the case, I find that in Form No.16 given by the employer, the deduction u/s 10 is mentioned to be Rs.5,53,544/-. However, it is not ascertainable how this exemption has been computed and what are its ingredients, Nature of corresponding payments by employer is not ascertainable. In absence of such relevant facts/evidences, the question of exemption cannot be decided in favour of the appellant. When the nature of the payments is not known, the deduction u/s 10 cannot be allowed. It is for the assessee to produce derails of these receipts and justify the claim of deduction. The appellant has failed to discharge this onus. The action of the A.O. calls for no interference. The addition is therefore, sustained. Grounds of appeal no.1 & 2 are rejected. Ground of appeal no.3 As regards the exemption u/s 16(iii), I find that though Form No.16 mentions deduction of Rs.2000/- allowable to the assessee as tax on employment, no evidence has been filed to prove that the employer had paid this tax and that he had included the same in gross receipts. In absence of such details, the deduction cannot be allowed. The addition is sustained. Ground of appeal no.3 is rejected. Ground appeal no.4 to 10. Grounds of appeal no4 to 7 are consequential in nature while grounds of appeal no.8 to 10 are general in nature and therefore, these grounds of appeal require no comment.”
3. Aggrieved by this, the assessee is in appeal. The Ld.AR submitted that on facts the submissions of the assessee have not been addressed and in case the evidence relied was found to be not sufficient, then the CIT(A) could have asked for an explanation. Accordingly it was his prayer that the additions made should be deleted.
I.T.A .No.-2734/Del/2016 Vikas Jain vs DCIT
Page 3 of 3 4. Ld.Sr.DR submitted that the matter may be remanded to the CIT(A) to consider the explanation of the assessee instead of deleting the addition at this stage. Referring to the grounds raised by the assessee who has pleaded lack of opportunity before the CIT(A), it was submitted the opportunity may be granted.
5. I have heard the rival submissions and perused the material available on record. I find that the additions have been made by the AO as necessary evidence in support of the claim was not made available to the AO. Considering the peculiar facts and circumstances where the Ld.AR has pleaded lack of opportunity in the grounds raised, it is considered appropriate to accept the prayer of the parties and set aside the impugned order directing the Ld.CIT(A) to pass a speaking order in accordance with law after considering the explanation of the assessee. Taking note of the fact that necessary evidences were not filed before the AO. It is deemed appropriate to permit the assessee to file evidence in support of its claim. The CIT(A) after confronting the same to the AO and seeking a Remand Report if need confront the same to the assessee before passing a speaking order in accordance with law.
In the result, the appeal of the assessee is allowed for statistical purposes.
The order is pronounced in the open court on 01 of February 2017.