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Income Tax Appellate Tribunal, DELHI BENCH: ‘SMC-1’ NEW DELHI
Before: SMT DIVA SINGH
The present appeal has been filed by the assessee assailing the correctness of the order dated 21.08.2014 of the CIT(A), Ghaziabad pertaining to 2009-10 AY on the following grounds:-
“That the Ld C.I.T(A) without affording the reasonable opportunity of being heard regarding the verification and thumb impression of Naresh Yadav rejected the confermation and completed the appellate proceedings and pass the order accordingly.
2. That both A.O as well as Ld C.I.T(A) without going through the cash flow chart and without considering the deposits obtained/made by naresh yadav being cosion has sustained the addition of Rs.19,48,000/-. 3. That the Ld C.I.T (A) also erred in not allowing a short term capital loss of Rs.3,08,000/-on the sale of House at 101 krishna vihar, Ghaziabad. 4. That the Addition and disallowances has made in Para No 2 and 3 is excessive arbitrary and uncalled for and deserve to be deleted. 5. That the Appellant craves its plea to add, amend, modify or delete any one or more of the grounds appeal before or at the time of hearing and all the above grounds are without prejudice to each others.”
Both the parties have been heard.
The relevant facts of the case are that the assessee who is engaged in the business of trading in milk, returned an income of Rs.1,45,360/-. The said return was processed under section 143(1) of the Income Tax Act, 1961 and selected for scrutiny as cash deposit of Rs.36,40,000/- was found to have been deposited in his bank accounts
I.T.A .No.-5644/Del/2014 maintained with the Allahabad bank Account No.114956 and Punjab and Sindh Bank Account No.7092. The assessee was required to explain the same. The explanation of the assessee was accepted to the extent of deposit of Rs.11,92,000/- as having been received from sale of property and considering the turnover of Rs.3,97,000/- deposit of Rs.5,00,000/- was also accepted. However, in regard to the remaining amount of Rs.19,48,000/-, the Assessing Officer rejected the explanation offered and made the addition of the said amount.
The assessee travelled in appeal before the First Appellate Authority explaining that his cousin brother, Sh. Naresh Yadav had sold the property and deposited the sale consideration of Rs.15,03,000/- in his bank account. The said explanation was supported by a confirmation from Sh. Naresh Yadav. The said explanation was not accepted by the CIT(A) in view of the fact that firstly there was no request for filing additional evidences; secondly the confirmation was by of only a thumb impression and it did not mention in whose presence it was affixed nor were the details of the witnesses given before whom the impression was given. Apart from that the ld.CIT(A) also was of the view that during the assessment proceedings the assessee had stated that the deposit was made from the sale consideration of his plots of his Tau/uncle. Thus, the explanation now offered that it was from his cousin was found to be contradictory. Accordingly the addition trade was sustained.
Apart from this, the CIT(A) further disallowed the claim of a capital loss of Rs.3,08,000/-. The assessee supported its claim pleading that the property had been purchased from Shri Ram Pal Singh Rana for Rs.15,00,000/- on 15.05.2008 on Power of Attorney and the subsequent sale of the said property to Sh. Shiv Kumar was made for Rs.11,92,000/-. The sale was registered in the name of Sh. Shiv Kumar by the original owner, Shri. Ram Pal Singh Rana as the sale to the assessee was by way of Power of Attorney only. The AO rejected the claim holding that the assessee never got it
I.T.A .No.-5644/Del/2014 registered in his own name as it was transferred by the original owner to the new purchaser.
The Ld. AR in the context of the above facts submitted that in the interest of Justice, the assessee may be provided an opportunity to file fresh evidences. As evidently there has been a miscarriage of justice as the assessee’s counsel appearing before the CIT(A) probably not aware of the procedures etc. to be followed, relied upon the evidences without first petitioning u/Rule 46A that they being fresh evidences may be admitted as due to lack of appropriate advise at the assessment stage the documents could not be filed. Thus, the decision based on arguments and relying upon evidences which were not sufficient to explain the claim and permission for filing of fresh evidences as per Statutory Rules and procedures may be provided the order may be set aside on both the issues. It was his submission that the evidences on which the assessee seeks to rely in regard to sale of the specific property sold by Sh. Naresh Yadav whose proceeds were deposited in assessee’s bank account is not something which the assessee can manufacture. Similarly, purchase of a specific property on a Power of Attorney from a specific person which was ultimately sold at a lesser price to another person are not documents which can be manufactured. It is only on account of non- awareness on the part of the counsel and the assessee being ignorant about the tax proceedings that uncle-nephew casual reference has been made. Similarly, lack of proper advise in regard to procedure where the counsel himself was not aware of the procedures has resulted in miscarriage of justice. The said prayer of the Ld. AR was not objected to by the Revenue. However, it was the stand of the Ld.Sr.DR that since fresh evidences are to be filed the appropriate authority for restoring the issue would be the Assessing Officer. Accordingly, considering the overall factual matrix, the prayer of the assessee is allowed. The impugned order is set aside and the issue is restored back to I.T.A .No.-5644/Del/2014 the file of the decision of AO with a direction to pass a speaking order in accordance with law after giving the assessee a reasonable opportunity of being heard. 7. In the result, the appeal of the assessee is allowed for statistical purposes. The order is pronounced in the open court on 04th of November, 2016.