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Income Tax Appellate Tribunal, NAGPUR BENCH, NAGPUR
Before: SHRI V. DURGA RAO & SHRI K.M. ROY, ACCOUNTANT, MEMBER
Date of Hearing – 15/05/2024 Date of Order – 15/05/2024
O R D E R PER V. DURGA RAO, J.M.
The present appeal has been filed by the assessee challenging the impugned order dated 16/12/2022, passed by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, [“learned CIT(A)”], for the assessment year 2018-19.
Dreamz Ifrastructure Rallies Plots ITA no.48/Nag./2023 S.A. no.1/Nag./2024
The assessee has also filed stay application with a prayer to stay the impugned outstanding demand of ` 36,15,80,296, for the assessment year 2018–19.
We first take up assessee’s appeal being ITA no.48/Nag./2023, for the assessment year 2018–19. The assessee has raised following grounds of appeal:-
“1. That the C.I.T. (Appeals) erred in confirming the addition made by estimating NP at 12% as against 7.13% disclosed by the assessee on the turnover of Rs.42,91,79,700/- and thereby making addition of Rs.2,17,70,635/. The estimation of net profit is absolutely improper and unjust more particulars as all the sale and purchase are by registered documents and expenses are fully supported by vouchers apart from the fact that they are most reasonable and books of accounts are duly audited u/s 44AB. The addition made by AO & confirmed by CIT (Appeals) is without affording reasonable opportunity to the assessee. The same deserves to be deleted.
2. That the C.I.T. (Appeals) erred in confirming the disallowance of depreciation claimed at Rs. 3,37,506/- on assets purchased during the year without appreciating the fact that books of accounts are audited and details of addition made to fixed assets alongwith depreciation claimed thereon are mentioned in audit report and auditor has worked out allowable depreciation as per Income Tax Act. The addition made by AO is without affording any opportunity to the assessee. The same be deleted.
3. That the C.I.T. (Appeals) erred in confirming the disallowance of Rs. 80,69,310/- at 5% on the allegation that amount is spent in respect of land contribution by 7 partners is unjust. In fact it is a cost of land which is brought by the partners and it is not the case that it is spending as presumed by AO. The addition made is improper, unjust and deserves to be delete.
4. That the Learned C.I.T. (Appeals) erred in confirming the addition of Rs. 15,63,28,413 u/s 68 by treating the unsecured loans raised during the year as unexplained credits without appreciating the fact that same are raised by account payee cheque from various parties. The addition made is improper, unjust and deserves to be delete.
5. That the C.I.T. (Appeals) erred in confirming the addition of Rs. 54,81,18,902/- u/s 68 by treating the amount received from various parties by bank account payee cheque as unexplained credits. The addition made is improper, unjust and deserves to be delete.
That the Learned C.I.T. (Appeals) erred in passing order u/s 144 r.w.s. 144B of the Income Tax Act by making variation in returned income which are Page | 2
Dreamz Ifrastructure Rallies Plots ITA no.48/Nag./2023 S.A. no.1/Nag./2024 prejudicial to the interest of assessee, without issuing draft assessment order and without providing opportunity to show cause though it is mandatory as per the provisions of law. The assessment made by AO is arbitrary, high pitched and without giving reasonable opportunity. AO framed the assessment on the total income at Rs. 76,53,15,376/- as against the returned income of Rs.3,06,90,610/- and raised exorbitant demand of Rs.36,15,80,296/- is improper, unjust and deserves to be cancelled.
7. That the CIT (Appeal) passed the appeal order u/s 250 of Income Tax Act, 1961 without affording reasonable opportunity of being heard and without considering the appellant's submission and documents - evidences submitted before him.
8. That the charging of interest u/s 234A, 234B, 234C & 234F is not proper, unjust and deserves to be cancelled.
That any other ground/s that may be raised at the time of hearing.”
Facts in brief:- The assessee is a partnership firm is in the business of real Estate, construction. The assessee maintains regular books of account which are duly audited under section 44AB of the Income Tax Appellate Tribunal (“the Act”). The assessment upto A.Y. 2017-18 are completed in scrutiny under section 143(3) of the Act and the returned income was at ` 1,16,61,640, which was scrutinised and assessed at ` 1,17,27,110, by making small disallowance of donation, etc. The assessee had filed its return of income for the year under consideration on 08/02/2019, declaring total income of ` 3,06,90,610. The assessment for the A.Y. 2018-19 was completed under section 144 r/w section 144AB of the Act wherein addition was made of ` 73,46,24,766.
When this appeal was taken up for hearing, the learned Counsel for the assessee submitted that neither the assessee has received notices from the Assessing Officer nor the Assessing Officer has provided sufficient opportunity to file all the relevant details before the Assessing Officer. He further
Dreamz Ifrastructure Rallies Plots ITA no.48/Nag./2023 S.A. no.1/Nag./2024 submitted that the assessee filed additional evidences before the learned CIT(A), however, the learned CIT(A) dismissed the appeal of the assessee without considering the additional evidences on the ground that the assessee has not filed the petition for admission of additional evidences. The learned Counsel for the assessee drew our attention to Page–4 of the assessment order and submitted that the assessee has to produce a book of account by way of unsecured loans from 17 entities / persons. He also pointed out that in respect of section 269SS of the Act, details of 440 entities / persons has to be examined which includes books of accounts, etc., and the Assessing Officer has to make a detailed enquiry with respect to various entities. The learned Counsel for the assessee, therefore, prayed that an opportunity be provided to the assessee to substantiate its case by restoring the file to the Jurisdictional Assessing Officer for passing assessment order afresh in accordance with law.
6. On the other hand, the learned Departmental Representative submitted that the assessee has not filed any details before the Assessing Officer and even before the learned CIT(A). Even the assessee has not filed any petition for admission of additional evidences and, hence, the learned CIT(A) has rightly passed the order in accordance with law.
We have heard the arguments of rival parties, perused the material available on record and gone through the orders of the authorities below. In this case, we find that the assessee has not filed relevant details as called for by the Assessing Officer. However, before the learned CIT(A), the assessee filed all the relevant details, but the learned CIT(A) has not considered the Page | 4
Dreamz Ifrastructure Rallies Plots ITA no.48/Nag./2023 S.A. no.1/Nag./2024 relevant details filed by the assessee on the ground that no petition has been filed for admission of additional evidences and affirmed the order passed by the Assessing Officer. Before us, the learned Counsel for the assessee made a request that in view of the voluminous submissions and subsequent verifications to be carried out, it will be appropriate if the matter is restored to the file of the Jurisdictional Assessing Officer instead of setting aside the matter to the National Faceless Assessment Centre. In this regard, we have perused the judgment of the Hon’ble Calcutta High Court rendered in Sanghi Steel Udyog Pvt. Ltd. v/s Union of India & Ors, 1549/2023, judgment dated 13/09/2023, wherein the Hon’ble Court had categorically held that the Act does not distinguish between the Jurisdictional Assessing Officer or National Faceless Assessment Centre with respect to a jurisdiction over a case. This is further corroborated by the fact that under section 144B of the Act, the record in a case are transferred back to the Jurisdictional Assessing Officer after the assessment proceedings are completed. Accordingly, since it is established that the Jurisdictional Assessing Officer as well as National Faceless Assessment Centre exercise a concurrent jurisdiction, the matter can be restored to the Jurisdictional Assessing Officer for the sake of natural justice and to facilitate easer administration of adjudication process. Under these facts and circumstances of the case, we are of the opinion that one more opportunity should be granted to the assessee to substantiate his case before the Jurisdictional Assessing Officer on the ground of principles of natural justice. Consequently, we set aside the impugned order passed by the learned CIT(A) and restore the appeal to the file of the Jurisdictional Assessing Officer and direct him to pass the assessment order denovo in view Page | 5
Dreamz Ifrastructure Rallies Plots ITA no.48/Nag./2023 S.A. no.1/Nag./2024 of our directions and in accordance with law after providing reasonable opportunity of being heard to the assessee.
In the result, assessee’s appeal is allowed for statistical purposes.
S.A. no.01/Nag./2024 Arising out of ITA no.48/Nag./2023 Assessment Year : 2018–19 9. Since the corresponding appeal filed by the assessee has been disposed off by this consolidated order cited supra, consequently, the stay application filed by the assessee becomes infructuous and hence liable to be dismissed.
In the result, stay application filed by the assessee is dismissed.
To sum up, appeal filed by the assessee is allowed for statistical purposes and stay application filed by the assessee is dismissed. Order pronounced in the open Court on 15/05/2024