RAJENDRA,MEERUT vs. ITO, WARD- 2(2), NEW DELHI

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ITA 7149/DEL/2017Status: DisposedITAT Delhi01 June 2018AY 2009-104 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found merit in the assessee's argument that the assessment under Section 144 was completed ex-parte without sufficient opportunity being afforded. The assessee had filed a paper book containing written submissions, bank details, affidavits, and copies of orders from lower authorities that were allegedly not properly considered. In the interest of justice, the Tribunal set aside the disputed issues to the file of the AO. The AO was directed to decide the issues afresh after providing an adequate opportunity of being heard to the assessee. The assessee was also directed to file all necessary documents to substantiate their case and cooperate with the AO without seeking unnecessary adjournments. The Tribunal explicitly noted that the facts narrated by the revenue authorities were not disputed by both parties.

What were the facts?

The assessee, Sh. Rajendra, filed an appeal against the order dated 24.10.2017 passed by the Commissioner of Income Tax (Appeals), Meerut, for the assessment year 2009-10. The Assessing Officer (AO) had passed an ex-parte order under Section 144 of the Income Tax Act, 1961, on 13.12.2016. The assessee contended that no notice under Section 148 was served, rendering the assessment bad in law. The assessee also argued that bank withdrawal entries were ignored, making the addition of Rs. 21,50,000/- on account of credit entries unjustified. The assessee requested an opportunity to present evidence before the AO, filing a paper book containing relevant documents.

What were the issues?

1. Whether the assessment made by the AO under Section 144 is bad in law due to non-service of notice under Section 148 upon the assessee, and whether the CIT(A) erred in confirming the same? (Question of law and fact, concerning Section 148 and Section 144 of the Income Tax Act, 1961). Assessee's contention: No notice under Section 148 was served, making the assessment under Section 144 invalid. The AO passed a non-speaking ex-parte order without affording sufficient opportunity. Revenue's contention: The Ld. DR relied upon the orders of the authorities below and opposed the assessee's request for an opportunity. 2. Whether the addition of Rs. 21,50,000/- on sale basis of credit entries is justified, given that the AO and CIT(A) ignored the bank entries of withdrawal made by the assessee? (Question of fact, concerning the validity of additions based on credit entries). Assessee's contention: Bank withdrawal entries were ignored, and the addition is arbitrary and not according to law. Revenue's contention: The Ld. DR relied upon the orders of the authorities below.

Which sections of the Income-tax Act were involved?

Section 148,Section 144,Section 142(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’ : NEW DELHI

Before: SHRI H.S. SIDHU

This appeal has been filed by the Assessee against the Order dated 24.10.2017 of the Ld. Commissioner of Income Tax (Appeals), Meerut relevant to assessment year 2009-10.

2.

The grounds raised in the appeal read as under:-

1.

That no notice u/s. 148 was served upon the assessee, therefore, assessment made by the AO u/s. 144 is bad in law and CIT(A) also in error for confirming the same.

2. That the AO as well as CIT(A) ignored the bank entries of withdrawal made by the assessee, therefore, addition on sale basis of credit entries is not justified at all. Therefore, addition made by AO

and confirmed by CIT(A) of Rs. 21,50,000/- is arbitrary, unjust and not according to law. 3. That the assessee has right to add, delete or modify any grounds during the appeal proceeding.

3.

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.

4.

During the hearing, Ld. A.R. of the assessee, has stated that AO has passed the exparte non-speaking order dated 13.12.2016 u/s. 144 of the Income Tax Act, despite the fact that the notice u/s. 148 of the Act was not served upon the assessee. He has requested that assessee has all the necessary evidences and can produce before the AO, if this Bench give an opportunity to the assessee for producing all the necessary documents before the AO. In this behalf he filed the paper Book containing pages 1 to 35.

5.

On the contrary, Ld. DR relied upon the orders of the authorities below and opposed the request of the assessee’s counsel request.

6.

I have heard both the parties and perused the records. I have also gone through the order passed by the revenue authorities as well as the contention raised by the assessee in the grounds of appeal

. I find force in the arguments of the Ld. Counsel of the assessee that AO has completed the assessment u/s. 144 of the Income Tax Act, 1961 vide exparte speaking order dated 13.12.2016 and sufficient opportunity was not afforded to the assessee for substantiating his claim. I further find that before the Tribunal the assessee has filed a Paper Book containing pages 1 to 35 in which he has attached the written submission, copy of rely filed before AO u/s. 142(1); photocopy of bank details along with narration; photocopy of the affidavit of Sh. Rajendra Pal, Sh. Rajpal, Sh. Seoraj Singh, Sh. Mahkar, Sh. Sube Singh, Sh. Atar Singh alongwith Khasra and Khatauni; photocopy of remand report; photocopy of rejoinder on remand report; photocopy of ITAt order in the case of ITO, Ward 2(4), Meerut vs. Sh,. Vipin Sirohi in which were filed before the lower authorities and were not properly considered. Therefore, in the interest of justice, the issues in dispute are set aside to the file of the AO to decide the afresh under the law, after giving adequate opportunity of being heard to the assessee. The assessee is also directed to file all the necessary documents to substantiate his case and fully cooperate with the AO in the proceedings and did not take any unnecessary adjournment.

7. In the result, the Assessee’s appeal is allowed for statistical purposes.

Order pronounced on 01-06-2018.

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