Shri Ali Hasan, Gurgaon v. ITO, New Delhi

ITA 2211/DEL/2010 | 2006-2007
Pronouncement Date: 16-07-2010 | Result: Allowed

Appeal Details

RSA Number 221120114 RSA 2010
Assessee PAN AAVPH9005M
Bench Delhi
Appeal Number ITA 2211/DEL/2010
Duration Of Justice 2 month(s) 6 day(s)
Appellant Shri Ali Hasan, Gurgaon
Respondent ITO, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 16-07-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 16-07-2010
Date Of Final Hearing 12-07-2010
Next Hearing Date 12-07-2010
Assessment Year 2006-2007
Appeal Filed On 10-05-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH A: NEW DELHI BEFORE SHRI I.P. BANSAL JUDICIAL MEMBER AND SHRI K.D. RANJAN ACCOUNTANT MEMBER ITA NOS. 2211 & 2212/DEL/2010 ASSESSMENT YEAR: 2006-07 ALI HASAN 4-18/21 PINK TOWER HOUSE DLF PHASE III GURGAON. AAVPH9005M VS. ITO WARD 38(1) NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY : BHAGIRATH TIWARI RESPONDENT BY: AMRENDRA KUMAR SR. DR O R D E R PER I.P. BANSAL J.M. BOTH THESE APPEALS ARE FILED BY THE ASSESSEE AND THEY ARE DIRECTED AGAINST TWO ORDERS OF CIT(A) DATED 23.02.10 FOR A.Y . 2006-07. GROUNDS OF APPEALS READ AS UNDER: - GROUNDS OF ITA NO. 2211/DEL/10 : 1. THE LD. AO HAD ERRED IN COMPLETING EX-PARTE ASS ESSMENT WITHOUT KNOWING THAT THE ASSESSEE WAS SERIOUSLY ILL FROM JU NE 2009 TO JANUARY 2009 AS HE HAD SEVERE PROBLEM OF HIP DISC AND WAS U NDER THE TREATMENT OF ORTHOPAEDECIAN. AS SUCH THE ACTION OF THE LD. AO IN FRAMING EX-PARTE ASSESSEE IS UNJUSTIFIED AND UNCALLED FOR. 2. THE LD. AO HAS ERRED IN MAKING AN ADDITION OF RS . 11 85 000/- TO THE INCOME OF THE ASSESSEE ALLEGING THE SAME TO BE AMOU NTS DEPOSITED IN THE BANK ACCOUNT ON VARIOUS DATES WHICH IN FACT ARE OUT OF THE GROSS RECEIPTS SHOWN BY THE ASSESSEE TO THE TUNE OF RS. 3 2 92 800/-. THE 2 ITA NOS. 2211 & 2212/DEL/2010 ASSESSEE HAD OFFERED TO BE ASSESSED UNDER THE PROVI SIONS OF SEC. 44AD AS PER OUR 8% OF THE GROSS RECEIPTS ARE TAKEN AS NE T ASSESSABLE INCOME. THE APPELLANT HAD CLEARLY MENTIONED IN THE STATEMEN T OF ASSESSABLE INCOME THAT THE INCOME WAS BEING OFFERED U/S 44AD A ND INSTEAD OF 8% HAD OFFERED 10% OF HIS GROSS RECEIPTS AND HIS NET I NCOME. THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION WITHOUT LOOKING INTO THE CASH FLOW STATEMENT OF THE ASSESSEE. THE ASSESSEE IS A TOTALLY ILLITERATE PETTY PRIVATE CONTRACTOR WHO IS OTHERWISE SUFFERING FROM ILLNESS. INSTEAD OF TAKING A LENIENT VIEW OF THE MATTER A SUM OF RS. 1 1 85 000/- HAS BEEN ADDED TO THE DECLARED INCOME OF RS. 3 24 560/- WHIC H IS TOTALLY UNJUSTIFIED UNCALLED FOR BAD IN LAW AND AS SUCH THE SAME IS REQUESTED TO BE DELETED. 3. THE ASSESSEE MAY BE PERMITTED TO RAISE ADDITIONA L GROUNDS OF APPEAL OR AMEND OR ALTER THE GROUND OF APPEAL IF REQUIRED SU BSEQUENTLY. GROUNDS OF ITA NO. 2212/DEL/10 : 1. THE LD. AO HAD ERRED IN IMPOSING A PENALTY OF R S. 80 000/- AND THE LD. CIT(A) HAS ERRED IN CONFIRMING THE SAID PENALTY OF RS. 80 000/- WITHOUT CONSIDERING THE FACT THAT THE ASSESSEE WAS TOTALLY BED RIDDEN AND WAS NOT ABLE TO ATTEND TO PROCEEDINGS FOR WHICH MEDICAL CERTIFICATE WAS ALSO PRODUCED BEFORE THE LD. CIT(A). AS SUCH THE ACTIO N OF THE LD. AO AS WELL AS THE LD. CIT(A) IS ARBITRARY UNJUSTIFIED AND BAD IN LAW AND UNCALLED FOR. 2. THE ASSESSEE MAY BE PERMITTED TO RAISE ADDITIONA L GROUNDS OF APPEAL OR AMEND OR ALTER THE GROUND OF APPEAL IF REQUIRED SU BSEQUENTLY. 2. THE ASSESSEE IS A CONTRACTOR WHO HAS FURNISHED T HE RETURN OF INCOME ON 31 ST AUGUST 2006 DECLARING AN INCOME OF RS. 3 07 650/- . 3. ACCORDING TO AIR INFORMATION THERE WERE CASH DEP OSITS OF RS. 11 85 000/- IN SAVING BANK ACCOUNT WITH NAINITAL BA NK GURGAON. IN RESPONSE TO VARIOUS NOTICES ISSUED FOR FRAMING THE ASSESSMEN T THE ASSESSEE DID NOT APPEAR HENCE EX-PARTE ASSESSMENT WAS MADE U/S 144 O F THE INCOME TAX ACT 3 ITA NOS. 2211 & 2212/DEL/2010 1961 WHEREBY AN ADDITION OF RS. 11 85 000/- BEING CASH DEPOSIT IN BANK ACCOUNT WAS ADDED TO THE INCOME OF THE ASSESSEE U/S 68 OF THE ACT BEING UNEXPLAINED CASH DEPOSITS. 4. BEFORE CIT(A) IT WAS SUBMITTED THAT ASSESSEE DOE S NOT MAINTAIN BOOKS OF ACCOUNT AS THE TURN OVER OF THE ASSESSEE IS LESS THAN RS. 40 LAKH. THE CASH FLOW STATEMENT WAS FILED WHEREIN THE SOURCE OF DEPO SIT IN THE BANK ACCOUNT WAS REFLECTED AND IT WAS SUBMITTED THAT THE CASH DEPOSI TED IN THE BANK ACCOUNT IS SUPPORTED BY THE EXPLAINED SOURCE OF INCOME. 5. IN THE ALTERNATIVE IT WAS SUBMITTED THAT THERE W AS A REASONABLE CAUSE FOR NON-APPEARANCE BEFORE THE AO. IT WAS SUBMITTED THA T THE ASSESSEE WAS SUFFERING WITH A CHRONIC DISEASE OF P.I.V.D. RADIAT ING LEFT LEG AND A MEDICAL CERTIFICATE WAS FILED TO SUPPORT SUCH ARGUMENT IN W HICH THE ASSESSEE WAS ADVISED COMPLETE BED REST FOR A PERIOD OF ALMOST FO R AN YEAR FROM JUNE 2008 TO JAN 2009 AND DUE TO THAT THE BED REST THE ASSESSEE COULD IMPROVE HIS HEALTH. THUS IT WAS SUBMITTED THAT THERE WAS LACK OF OPPOR TUNITY AND THERE WAS REASONABLE CAUSE FOR NON-ATTENDANCE BEFORE AO. LD. CIT(A) HAS REJECTED ALL THESE DOCUMENTS. HE DENIED TO TAKE INTO CONSIDERAT ION THE CASH FLOW STATEMENT ON ACCOUNT OF THE SAME BEING ADDITIONAL EVIDENCE. HE OBSERVED THAT ASSESSEE COULD NOT FILED ADDITIONAL EVIDENCE IN ABSENCE OF E XPLANATION TO SHOW THAT HOW THE CONDITIONS LAID DOWN UNDER RULE 46 WERE APPLICA BLE FOR ADMISSION OF THE ADDITIONAL EVIDENCE. THUS THE ADDITIONAL HAS BEEN UPHELD BY LD. CIT(A). 4 ITA NOS. 2211 & 2212/DEL/2010 6. ONE SHRI BHAGIRATH TIWARI APPEARED ON BEHALF OF ASSESSEE FOR TAKING ADJOURNMENT. HOWEVER HE SUBMITTED THAT AS THE ASS ESSEE IS PLEADING LACK OF OPPORTUNITY ON ACCOUNT OF PREVENTED BY REASONABLE C AUSE FOR NON-APPEARANCE BEFORE AO AND ALSO REFUSAL OF ADMISSION OF ADDITION AL EVIDENCE BEFORE CIT(A) IT WILL SERVE THE PURPOSE OF INTEREST OF JUSTICE IF T HE MATTER MAY BE RESTORED BACK TO THE FILE OF AO FOR MAKING DENOVO ASSESSMENT. 7. HOWEVER LD. DR RELIED UPON THE ORDER OF AO AND CIT(A). 8. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS IN THE LIGHT OF MATERIAL PLACED BEFORE US. THE ASSESSEE HAS PLEADE D BEFORE CIT(A) THAT HIS FAILURE TO ATTEND THE ASSESSMENT PROCEEDINGS WAS ON ACCOUNT OF MEDICAL PROBLEM AND TO SUPPORT SUCH CONTENTION MEDICAL CERT IFICATE WAS ALSO FILED. HOWEVER HIS NON-ATTENDANCE BEFORE AO HAS RESULTED INTO EX-PARTE ASSESSMENT ORDER IN WHICH MAIN ADDITION HAS BEEN MADE ON ACCOU NT OF UNEXPLAINED CASH CREDITS IN THE BANK ACCOUNT. DURING THE COURSE OF APPELLATE PROCEEDINGS THE ASSESSEE HAD SUBMITTED CASH FLOW STATEMENT TO CONTE ND THAT THE CASH DEPOSITS IN THE BANK ACCOUNT WERE SUPPORTED BY EXPLAINED SOU RCE. THE SAID EVIDENCE HAS BEEN REFUSED TO BE ADMITTED BY THE LD. CIT(A) D ESPITE THE FACT THAT ASSESSEE HAD PRODUCED MEDICAL CERTIFICATE TO CONTEN D THAT HIS FAILURE TO APPEAR BEFORE AO WAS ON ACCOUNT OF MEDICAL PROBLEMS. KEEP ING IN VIEW THE ENTIRETY OF THESE FACTS WE ARE OF THE OPINION THAT IN THE INTE REST OF JUSTICE THIS MATTER SHOULD BE RESTORED BACK TO THE FILE OF AO WITH THE DIRECTION TO RE-FRAME DENOVO ASSESSMENT AFTER GIVING REASONABLE OPPORTUNITY OF H EARING AS WELL AS PLACING ALL 5 ITA NOS. 2211 & 2212/DEL/2010 THE EVIDENCES ON RECORD TO THE ASSESSEE TO EXPLAIN HIS CASE. WITH THESE DIRECTIONS WE RESTORE THIS MATTER TO THE FILE OF A O. 9. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES IN THE MANNER AFORESAID. 10. SO AS IT RELATES TO PENALTY LEVIED U/S 271B WE HAVE ALREADY OBSERVED THAT NON-ATTENDANCE OF THE ASSESSEE WAS ON ACCOUNT OF MEDICAL PROBLEM BEING FACED BY THE ASSESSEE FOR WHICH THE MEDICAL CERTIFI CATE WAS ALSO FILED BEFORE CIT(A). IN ANY CASE NOW WE HAVE RESTORED THE MATTE R TO THE FILE OF AO WITH A DIRECTION TO FRAME DENOVO ASSESSMENT. IN THIS VIEW OF THE SITUATION WE FIND NO JUSTIFICATION IN CONFIRMING THE PENALTY WHICH IS DE LETED HENCE THE APPEAL FILED IN RESPECT OF LEVY OF PENALTY IS ALLOWED. 11. IN THE RESULT THE APPEAL IN QUANTUM PROCEEDING S IS ALLOWED FOR STATISTICAL PURPOSES AND APPEAL IN PENALTY PROCEEDINGS IS ALLOW ED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 16.07.201 0 (K.D. RANJAN) ACCOUNTANT MEMBER (I.P. BANSAL) JUDICIAL MEMBER DATED: 16.07.2010 *KAVITA 6 ITA NOS. 2211 & 2212/DEL/2010 COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ITAT NEW DELHI. TRUE COPY BY ORDER DEPUTY REGISTRAR