Sri R Siva Prasad, Visakhapatnam v. The ACIT, Circle-3(1), Visakhapatnam

ITA 18/VIZ/2006 | 2000-2001
Pronouncement Date: 31-12-2010 | Result: Allowed

Appeal Details

RSA Number 1825314 RSA 2006
Bench Visakhapatnam
Appeal Number ITA 18/VIZ/2006
Duration Of Justice 4 year(s) 11 month(s) 14 day(s)
Appellant Sri R Siva Prasad, Visakhapatnam
Respondent The ACIT, Circle-3(1), Visakhapatnam
Appeal Type Income Tax Appeal
Pronouncement Date 31-12-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted DB
Tribunal Order Date 31-12-2010
Date Of Final Hearing 20-12-2010
Next Hearing Date 20-12-2010
Assessment Year 2000-2001
Appeal Filed On 17-01-2006
Judgment Text
ITA NO.18 OF 06 R SIVA PRASAD VISAKHAPATNAM U-S 69 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH VISAKHAPATNAM BEFORE: SHRI SUNIL KUMAR YADAV JUDICIAL MEMBER AND SHRI BR BASKARAN ACCOUNTANT MEMBER ITA NO.18/VIZAG/2006 ASSESSMENT YEAR: 2000-01 R. SIVA PRASAD VISAKHAPATNAM VS. DY.COMMISSIONER OF INCOME TAX CIRCLE-3(1) VISAKHAPATNAM (APPELLANT) PAN NO:ACJPR 8695 M (RESPONDENT) APPELLANT BY: SHRI Y.A. RAO CA RESPONDENT BY: SHRI D.S. SUNDER SINGH DR ORDER PER SHRI B. R. BASKARAN ACCOUNTANT MEMBER: THE APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 7.11.2005 PASSED BY LEARNED CIT(A)-1 VISAKHAPATNA M AND IT RELATES TO THE ASSESSMENT YEAR 2000-01. 2. THE ASSESSEE IS ASSAILING THE DECISION OF THE LE ARNED CIT (A) IN CONFIRMING THE ADDITION OF RS.6 15 000/- MADE BY TH E ASSESSING OFFICER UNDER SECTION 69A OF THE ACT. 3. THE FACTS RELATING TO THE ISSUE ARE STATED IN BR IEF. THE ASSESSEE DID NOT FILE HIS RETURN OF INCOME FOR THE ASSESSMEN T YEAR UNDER CONSIDERATION AND HENCE THE ASSESSING OFFICER ISSUE D A NOTICE UNDER SECTION 148 OF THE ACT. IN RESPONSE THERETO THE ASS ESSEE FILED HIS RETURN OF INCOME DECLARING A TOTAL INCOME OF RS.4 3 5 321/-. IN THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFF ICER NOTICED THAT A SUM OF RS.6 35 000/- WAS FOUND CREDITED IN THE BA NK ACCOUNT OF THE ITA NO.18 OF 06 R SIVA PRASAD VISAKHAPATNAM U-S 69 PAGE 2 OF 4 ASSESSEE. WITH REGARD TO THE SOURCE THE ASSESSEE E XPLAINED THAT HE HAD UTILIZED THE ADVANCE OF RS.6 15 000/- IN CASH F ROM A COMPANY NAMED M/S PROS & CONS. ESTATE (P) LTD. TOWARDS THE SALE OF HIS FLAT FOR MAKING THE IMPUGNED DEPOSIT. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER ISSUED SUMMONS T O M/S PROS & CONS ESTATE PRIVATE LIMITED CALLING FOR PRODUCTION OF ACCOUNT. HOWEVER IN RESPONSE TO THE SAID SUMMON ONE SHRI R . CHAKRADHARA RAO SENT A LETTER STATING THAT HE HAS RESIGNED THE POSITION OF THE MANAGING DIRECTOR OF THE SAID COMPANY. FURTHER HE G AVE AN ADDRESS WHEREIN THE PRESENT DIRECTOR (WITHOUT MENTIONING NA ME OF THE DIRECTOR) WAS STATED TO BE RESIDING. THE SAID PERSO N ALSO FORWARDED A COPY OF THE ANNUAL STATEMENT OF THE COMPANY WHEREIN AN AMOUNT OF RS.6 15 000/- WAS SHOWN UNDER THE HEAD LOANS & ADV ANCES AS ADVANCE FOR PURCHASE OF FLAT. THE ASSESSING OFFICER DID NOT TAKE COGNIZANCE OF THE ANNUAL ACCOUNT AS THE SAME DID NO T INDICATE THAT THE SAID ADVANCE WAS PAID TO THE ASSESSEE HEREIN. T HE ASSESSING OFFICER ALSO CAUSED INQUIRIES IN THE ADDRESS WHERE IN THE PRESENT DIRECTOR OF THE COMPANY WAS STATED TO BE RESIDING. HOWEVER IT WAS REVEALED BY A LADY WHO WAS RESIDING IN THAT ADDRES S THAT THERE WAS NO SUCH COMPANY IN THAT ADDRESS. ACCORDINGLY THE AS SESSING OFFICER TREATED THE AMOUNT OF RS.6 15 000/- AS THE INCOME O F THE ASSESSEE UNDER SECTION 69A OF THE ACT. 4. DURING THE COURSE OF APPELLATE PROCEEDINGS THE ASSESSEE FILED AN AFFIDAVIT FROM A PERSON NAMED SHRI S. RAMA RAJU WHO CLAIMED IN THE AFFIDAVIT THAT HE JOINED AS A DIRECTOR IN THE C OMPANY NAMED M/S PROS & CONS ESTATE (P) LTD. W.E.F.1.2.2000 AND ALS O CONFIRMED ABOUT THE AGREEMENT TO PURCHASE THE FLAT BELONGING TO THE ASSESSEE AND ALSO PAYMENT OF RS.6 15 000/- TO THE ASSESSEE HEREI N. IN THE AFFIDAVIT IT WAS ALSO STATED THAT THE INQUIRIES WERE CONDUCTE D BY THE INCOME ITA NO.18 OF 06 R SIVA PRASAD VISAKHAPATNAM U-S 69 PAGE 3 OF 4 TAX AUTHORITIES FROM HIS MOTHER IN THE ADDRESS GIVE N BY THE EARLIER MANAGING DIRECTOR AND HIS MOTHER WAS NOT AWARE OF T HE ACTIVITIES OF THE COMPANY. THE LEARNED CIT (A) REJECTED THE SAID AFFIDAVIT BY STATING THAT IT IS AN AFTER THOUGHT. WITH REGARD T O THE EXPLANATIONS ABOUT THE NON-EXISTENCE OF THE COMPANY IN THE GIVEN ADDRESS THE LEARNED CIT(A) HELD THAT IT IS AN ATTEMPT TO COVER UP THE LACUNAE. ACCORDINGLY THE LEARNED CIT (A) BY RELYING UPON T HE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF CIT VS. DURGA PRASAD MORE (82 ITR 540) CONFIRMED THE ORDER OF THE ASSESSING OFFIC ER. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. WE NOTICE THAT THE TAX AUTHORITIES REJECTED THE EXP LANATION OF THE ASSESSEE ONLY FOR THE REASON THAT THE ASSESSEE COUL D NOT PROVE THE EXISTENCE OF THE COMPANY M/S PROS & CONS ESTATE (P) LTD. THE CASE OF LEARNED AUTHORISED REPRESENTATIVE IS THAT THE CO MPANY M/S. PROS & CONS ESTATE (P) LTD. IS A PRIVATE LIMITED COMPANY REGISTERED UNDER THE COMPANIES ACT AND IT HAS FILED ITS ANNUAL ACCOUNTS WITH THE REGISTRAR OF THE COMPANIES WHEREIN THE PAYMENT OF IMPUGNED AD VANCE OF RS.6 15 000/- WAS DULY DISCLOSED. DURING THE COURS E OF APPELLATE PROCEEDINGS THE ASSESSEE HAS FILED AN AFFIDAVIT FR OM THE DIRECTOR OF THE COMPANY NAMED SHRI S. RAMA RAJU AND WE NOTICE T HAT THE FIRST APPELLATE AUTHORITY HAS REJECTED THE SAME WITHOUT E XAMINING THE SAID PERSON. FROM THE COPY OF THE AFFIDAVIT FILED BEFOR E US THE SAID DIRECTOR HAS CONFIRMED THE PAYMENT OF ADVANCE OF RS .6 15 000/- AND HE HAS FURNISHED A COPY OF SALE AGREEMENT ALONG WIT H THE AFFIDAVIT. HENCE IN OUR VIEW THE TAX AUTHORITIES SHOULD HAVE EXAMINED THE SAID DIRECTOR BEFORE TAKING ANY ADVERSE VIEW AGAINST THE ASSESSEE. ACCORDINGLY IN THE INTEREST OF NATURAL JUSTICE WE SET ASIDE THE ORDER OF THE LEARNED CIT(A) AND RESTORE THE ISSUE BACK TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO MAKE NECESSAR Y ENQUIRIES UPON ITA NO.18 OF 06 R SIVA PRASAD VISAKHAPATNAM U-S 69 PAGE 4 OF 4 THE AFFIDAVIT FILED BY THE ASSESSEE AND DECIDE THE ISSUE IN ACCORDANCE WITH LAW. THE ASSESSEE SHOULD BE GIVEN NECESSARY O PPORTUNITY OF BEING HEARD. 6. IN THE RESULT THE APPEAL OF THE ASSESSEE IS TRE ATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 31-12-2010. SD/- SD/- (SUNIL KUMAR YADAV) (B R BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER PVV/SPS VISAKHAPATNAM DATE: 31-12-2010 COPY TO 1 SHRI R. S IVA PRASAD C/O ROWE & PAL CHARTERED ACCOUNTANTS 14 - 36-1 KRISHNA NAGAR VISAKHAPATNAM 2 THE ASSTT. COMMISSIONER OF INCOME TAX CIRCLE - 3(1) VISAKHAPATNAM 3 4. THE CIT 1 VISAKHAPATNAM THE CIT(A)-1 VISAKHAPATNAM 5 THE DR ITAT VISAKHAPATNAM. 6 GUARD FILE. BY ORDER SENIOR PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM