ITO, New Delhi v. Mr. Darsh Pal Seble, New Delhi

ITA 2432/DEL/2013 | 2008-2009
Pronouncement Date: 17-04-2014 | Result: Dismissed

Appeal Details

RSA Number 243220114 RSA 2013
Assessee PAN BIVPS5682N
Bench Delhi
Appeal Number ITA 2432/DEL/2013
Duration Of Justice 11 month(s) 22 day(s)
Appellant ITO, New Delhi
Respondent Mr. Darsh Pal Seble, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 17-04-2014
Appeal Filed By Department
Order Result Dismissed
Bench Allotted B
Tribunal Order Date 17-04-2014
Date Of Final Hearing 27-03-2014
Next Hearing Date 27-03-2014
Assessment Year 2008-2009
Appeal Filed On 25-04-2013
Judgment Text
ITA NO. 2432/DEL/13 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: B NEW DELHI BEFORE SHRI G. D. AGRAWAL VICE PRESID ENT AND SHRI A. D. JAIN JUDICIAL MEMBER I.T.A .NO. 2432/DEL/2013 (ASSESSMENT YEAR: 2008-09) ITO WARD-23(1) ROOM NO. 1207 12 TH FLOOR E-2 BLOCK CIVIC CENTRE MINTO ROAD NEW DELHI (APPELLANT) VS DARSH PAL SEBLE B-301 SHAKTI APARTMENTS SECTOR- 5 PLOT NO. 18 DWARKA NEW DELHI BIVPS5682N (RESPONDENT) APPELLANT BY SMT. NIDHI SRIVASTAVA CIT DR RESPONDENT BY SH. D.R. SINGH ADV ORDER PER A. D. JAIN JM THIS DEPARTMENTS APPEAL FOR A. Y 2008-09 TAKING THE FOLLOWING GROUNDS:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN ACCEPTING THE ADDITIONAL EVIDENCE IN VIOLATION O F RULE 46A OF THE INCOME TAX ACT. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.30 49 000/- MADE BY THE AO AS UNEXPLAINED CASH CREDITS U/S 68 OF THE INCOME TAX ACT ON THE B ASIS OF ADDITIONAL EVIDENCES FILED BY THE ASSESSEE. ITA NO. 2432/DEL/13 2 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE DISALLOWANCE OF DEDUCTION U/S 80C OF R S.1 00 000/- ON THE BASIS OF ADDITIONAL EVIDENCES FILED BY THE ASSESSEE . 2. THE FACTS ARE THAT THE ASSESSEE FILED RETURN OF INCOME FOR THE A.Y 2008-09 ON 31/7/2008 DISCLOSING INCOME OF RS.5 09 682/-. THE CASE WAS SELECTED FOR SCRUTINY BY ISSUE OF NOTICE U/S 143(2) DATED 4/8/2009. THE ASS ESSEE FAILED TO COMPLY WITH THE SAID NOTICE AND WITH SUBSEQUENT NOTICES ISSUED U/S 143(2) AND 142(1). THE ASSESSING OFFICER PROCEEDED TO FRAME THE ASSESSMENT U/S 144 O N THE BASIS OF THE MATERIAL ON RECORD. THE ASSESSING OFFICER HAD RECEIVED AIR INF ORMATION THAT THE ASSESSEE HAD DEPOSITED CASH AMOUNTING TO RS.30 49 000/- IN HIS S AVINGS ACCOUNT WITH AXIS BANK. IN THE ABSENCE OF ANY EXPLANATION REGARDING THE SOU RCES THEREOF THE ASSESSING OFFICER TREATED THE SUM OF RS.30 49 000/- AS UNEXPL AINED CASH CREDITS U/S 68. THE ASSESSING OFFICER FURTHER DISALLOWED THE CLAIM OF D EDUCTION UNDER CHAPTER VIA OF THE I. T. ACT AMOUNTING TO RS.1 00 000/- AS THE AS SESSEE HAD FAILED TO PROVIDE ANY SUPPORTING DOCUMENTS. 3. BY VIRTUE OF THE IMPUGNED ORDER THE LD. CIT(A) DELETED BOTH THE ABOVE ADDITIONS. AS A RESULT THE DEPARTMENT HAS RAISED THE GROUNDS OF APPEAL BEFORE US. 4. APROPOS GROUND NOS 1 & 2 THE LD. DR CONTENDS TH AT THE LD. CIT (A) HAS ERRED IN DELETING THE ADDITION OF RS.30 49 000/-MAD E BY THE AO AS UNEXPLAINED CASH CREDITS; AND THAT WHILE DOING SO THE LD. CIT(A) HA S WRONGLY RELIED ON THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE BEFORE THE LD. CIT(A ). 5. THE LD. COUNSEL FOR THE ASSESSEE ON THE OTHER H AND HAS PLACED STRONG RELIANCE ON THE ORDER UNDER APPEAL IN THIS REGARD. 6. IT IS SEEN THAT THE ADDITION WAS MADE BY THE AO BY OBSERVING THAT THE ASSESSEE HAD FAILED TO FURNISH ANY EXPLANATION AND SUPPORTIN G DOCUMENTS REGARDING THE AMOUNT OF RS.30 49 000/- DEPOSITED IN THE ASSESSEE S SAVINGS BANK ACCOUNT WITH AXIS BANK. BEFORE THE LD. CIT(A) THE ASSESSEE CON TENDED INTER-ALIA THAT NOTICES ITA NO. 2432/DEL/13 3 UNDER SECTIONS 143(2) AND 142(1) OF THE I.T ACT WER E NEVER RECEIVED BY HIM AS THE ADDRESS AT WHICH THEY WERE SENT HAD ALREADY BEEN VA CATED AND CHANGED; THAT THE ASSESSEE BEING ALONE IN INDIA AND HIS FAMILY BEING RESIDENT IN CANADA WAS MAINLY RESIDING WITH HIS NEPHEW SHRI SUNIL BATRA WHO WAS THE OWNER OF THE ADDRESS PROVIDED IN THE RETURN OF INCOME AND AT WHICH ADDRE SS NOTICES U/S 142(2) OF THE ACT FOR A. Y 2011-12 ETC. WERE STILL BEING RECEIVED; THAT NO NOTICE OF HEARING WAS EVER RECEIVED EITHER BY THE ASSESSEE OR BY ANY OF THE M EMBERS RESIDING AT THE GIVEN ADDRESS OR AT THE OLD ADDRESS I.E 204 ANSAL TOW ER 38 NEHRU PLACE NEW DELHI 110019 AT WHICH ADDRESS THE ASSESSMENT ORDER WAS PASSED; THAT THE ASSESSEE CAME TO KNOW ABOUT THE EX-PARTE ASSESSMENT AND ITS PROCE EDINGS AFTER MORE THAN TWO MONTHS I.E IN THE MONTH OF MARCH 2011 WHEN THE BANK ACCOUNT OF THE ASSESSEE WAS ATTACHED AND THE AMOUNT OF RS.8 89 400/- BEING THE BALANCE IN THE SAID BAND ACCOUNT WAS REALIZED AGAINST THE DEMAND CREATED BY THE ASSESSMENT ORDER; THAT IT WAS AT SUCH THAT THE ASSESSEE DID NOT GET ANY OPPOR TUNITY TO FILE EXPLANATION AND LEAD EVIDENCE WITH REGARD TO THE ALLEGED CASH DEPOSITS I N THE BANK ACCOUNT AND TO SUPPORT THE DEDUCTION OF RS.1 LAC CLAIMED U/S 80C OF THE AC T; AND THAT THEREFORE THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE TO PRODUCE EVIDEN CE BEFORE THE AO. THE ASSESSEE PRODUCED THE FOLLOWING ADDITIONAL EVIDENCE BEFORE T HE LD. CIT(A):- 1. PHOTOCOPY OF RELEVANT STATEMENT OF BANK ACCOUNT CONTAINING THE ALLEGED CASH DEPOSITS (ACCOUNT NO. 176010100137621 OF DARSH PAL SEBLE WITH AXIS BANK LTD. RUDRAPUR (U.P) FOR THE INVOLVED ASSE SSMENT YEAR). THE SAME ALSO SUPPORTS THE DEPOSIT OF RS.1 00 000/- TOW ARDS THE FDR FOR CLAIM U/S 80C. 2. EXPLANATION OF CASH DEPOSITS IN THE ABOVE BANK ACCO UNT. 3. CONFIRMATION IN TWO CERTIFICATES WITH PAN OF THE SOURCE PAYER IN RESPECT OF SOURCE AND EXPLANATION OF CASH DEPOSITS. 4. PHOTOCOPIES OF AGREEMENTS TO SELL IMMOVABLE PROP ERTY (4NOS.). ITA NO. 2432/DEL/13 4 7. THE ASSESSEE ALSO SUBMITTED BEFORE THE LD. CIT(A ) THAT HE HAD ENTERED INTO A TRANSACTION FOR THE SALE OF HIS ANCESTRAL PROPERTY SITUATED AT WARD NO. 10/ GANDHI COLONY GOLE MARKET RUDRAPUR WITH GROWER DEVELOPE RS SGAD COMPLEX NAINITAL ROAD RUDRAPUR DISTRICT US NAGAR ON 14/10/2006 FO R AN AGREED TOTAL CONSIDERATION OF RS.3 10 00 000/- AND HAD RECEIVED ADVANCES AGAIN ST THE TRANSACTION FROM TIME TO TIME THROUGH CHEQUES AND IN CASH; THAT THE DETAIL O F THE PAYMENTS OF THE ADDITIONS AND CONFIRMATION THEREOF BY THE PARTNERS OF M/S GRO VER DEVELOPERS AND THE DETAIL OF CASH PAID DURING F.Y 2007-08 ALONG WITH PANS OF TH E BUYERS WAS IN THE ADDITIONAL EVIDENCE FILED. IT WAS STATED THAT THE INVOLVED CA SH DEPOSITS IN THE BANK ACCOUNT REPRESENTED THE STATED CASH RECEIPTS. THE ASSESSEE FILED PHOTOCOPY OF THE RELEVANT BANK STATEMENT ALONG WITH EXPLANATION AS FOLLOWS:- DATE OF DEPOSIT AMOUNT DEPOSITED EXPLANATION 3/7/2007 200 000 ADVANCE RECEIVED AGAIN ST AGREEMENT TO SELL IMMOVABLE PROPERTY (EVIDENCE/IDENTITY AND CONFIRMA TION OF PAYER IS AT PAGES 4 TO 6 & TH E COPY OF AGREEMENTS AT PAGES 7 TO PAGE 50) 14/7/2007 49 000 SAME AS ABOVE (RECEIVED 50 000) 18/07/2007 100 000 SAME AS ABOVE 31/07/2007 400 000 SAME AS ABOVE 02/08/2007 200 000 ADVANCE RECEIVED AS STATED ABOVE 03/08/2007 200 000 ADVANCE RECEIVED AS STATED ABOVE 31/08/2007 300 000 ADVANCE RECT. AS STATED ABOVE 28/09/2007 300 000 ADVANCE RECD AS ABOVE. 23/10/2007 100 000 REDEPOSIT (WITHDRAWN 300 000 ON (1/10/2007) 29/10/2007 300 000 ADVANCE RECD. AS STATED ABOVE. 14/12/2007 150 000 REDEPOSIT (WITHDRAWN 200 000 10/12/2007) 14/12/2007 50 000 REDEPOSIT OF BALANCE OF ABOVE WITHDRAWAL 16/02/2008 50 000 ADVANCE RECD. AS STATED ABOVE RS.100 000. 20/02/2008 50 000 BALANCE OF ABOVE ADVANCE RECD. 04/03/2008 200 000 REDEPOSIT OF WITHDRAWAL OF 200 000 ON 01/03/2008 ITA NO. 2432/DEL/13 5 14/03/2008 100 000 REDEPOSIT OF WITHDRAWAL OF 08/03/2008 100 000 25/03/2008 200 000 ADVANCE RECD. AS STATED ABOVE. TOTAL... 3 049 000 (ADVANCE RECD. 20 50 000 & REDEPOSIT 10 00 000) 8. CONSIDERING THAT THE NOTICES UNDER SECTIONS 143( 2) & 142(1) OF THE ACT WERE NEVER RECEIVED BY THE ASSESSEE AND ALSO TAKING INTO CONSIDERATION THE MATERIAL RELEVANCE OF THE ADDITIONAL EVIDENCE FILED BY THE A SSESSEE THE LD. CIT(A) FORWARDED THE SAID EVIDENCE TO THE AO ASKING FOR A REMAND RE PORT AND REQUIRING THE AO TO CORRELATE THE DATES OF DEPOSITS OF CASH IN THE BANK ACCOUNT WITH THE DATES OF RECEIPT OF CASH AS PER THE SALE AGREEMENT STIPULATED BY THE AS SESSEE. THE AO VIDE HIS REMAND REPORT DATED 7/1/2013 VEHEMENTLY OBJECTED TO THE A DMISSION OF THE ADDITIONAL EVIDENCE STATING THAT THE NOTICES HAD BEEN SENT TO THE ASSESSEE AT THE ADDRESS PROVIDED IN THE RETURN OF INCOME. WITH REGARD TO T HE MERIT OF THE ADDITIONAL EVIDENCE THE AO STATED IN THE REMAND REPORT THAT T HOUGH THE ASSESSEE HAD STATED THAT AN AMOUNT OF RS.20.50 LACS HAD BEEN RECEIVED BY HIM AS ADVANCES AGAINST PROPERTY FROM SHRI DIWAN SINGH ON VERIFICATION IT HAD BEEN NOTICED THAT AS PER THE SALE DEED PROVIDED NO AGREEMENT TO SELL THE PROPERTY HAD BEE N ENTERED INTO WITH SHRI DIWAN SINGH; THAT AS PER THE COPIES OF THE SALE DEED THE AGREEMENT HAD BEEN MADE WITH SURENDER SINGH GROVER JASWINDER KAUR GROVER AMARJ EET KAUR GROVER & JIGAR PREET KAUR GROVER; THAT THUS THE ADDITIONAL EVIDEN CE SUBMITTED BY THE ASSESSEE WAS NOT CONCLUSIVE AND DID NOT CLARIFY THE SOURCE OF TH E CASH DEPOSITS; AND THAT SINCE NO DETAILS OR EXPLANATION HAD BEEN FILED BY THE ASSESS EE DURING THE ASSESSMENT PROCEEDINGS THE CASE HAD BEEN DECIDED ON MERITS. HOWEVER THOUGH HE HAD BEEN REQUIRED BY THE LD. CIT(A) TO DO SO THE AO IN THE REMAND REPORT DID NOT OFFER ANY COMMENT ON THE CORRELATION OF THE DATES OF THE CASH DEPOSITS IN THE BANK ACCOUNT WITH THE DATE OF RECEIPT OF CASH AS ADVANCE ON SALE OF LAND. ITA NO. 2432/DEL/13 6 9. IN HIS REJOINDER TO THE AOS REMAND REPORT THE ASSESSEE REITERATED HIS STAND OF NOT HAVING RECEIVED ANY NOTICE QUA THE ASSESSMENT P ROCEEDINGS. ON THE MERITS OF THE ADDITIONAL EVIDENCE HE STATED THAT THE CERTIFICATE OF DIWAN SINGH FILED BY THE ASSESSEE BEFORE THE CIT(A) MADE IT CLEAR THAT SHRI DIWAN SINGH WAS THE FATHER OF SHRI SURENDER SINGH GROVER AND JASWINDER KAUR GROV ER WAS WIFE OF SHRI SURENDER SINGH; THAT IN THIS CERTIFICATE BOTH SURENDER SING H GROVER AND JASWINDER KAUR GROVER PARTNERS OF GROWER DEVELOPERS HAD CONFIRME D THAT THEY HAD PAID CASH ADVANCE OF RS.20 50 000/- TO THE ASSESSEE THROUGH S HRI DIWAN SINGH IN F.Y 2007-08; THAT THIS CERTIFICATE HAD BEEN DULY EXECUTED BY BOT H OF THEM BEFORE A NOTARY; THAT THE CASH RECEIPTS IN QUESTION HAD BEEN DULY ADJUSTED IN THE CONSIDERATION MENTIONED IN THE AGREEMENTS; THAT THE AO HAD FAILED TO APPRECIAT E THESE FACTS AND THE GENUINENESS OF THE SOURCE OF THE BANK DEPOSITS; AND THAT SINCE THE AO HAD NOT COMMENTED THEREON HE HAD ACCEPTED THE FACTS REGARDING THE RE DEPOSIT OF CASH OF RS.10 LACS AGAINST CASH WITHDRAWALS. THE LD. CIT(A) TAKING AL L THE ABOVE FACTS INTO CONSIDERATION HELD THAT THE AO COULD NOT BE SAID T O HAVE ALLOWED IN-ADEQUATE OPPORTUNITY TO THE ASSESSEE AND THAT EVEN OTHERWISE THE ASSESSEE HAD BEEN AFFORDED ADEQUATE OPPORTUNITY IN THE APPELLATE PROCEEDINGS. THE ADDITIONAL EVIDENCE WAS ADMITTED BY THE CIT(A) ON HAVING TAKING INTO CONSID ERATION THE TOTALITY OF THE FACTS AND CIRCUMSTANCES AS DISCUSSED ABOVE AND WE DO NOT FIND ANY ERROR IN THIS ACTION OF THE LD. CIT(A). ACCORDINGLY THE GRIEVANCE OF THE DEPARTMENT IN THIS REGARD STANDS REJECTED. 10. SO FAR AS REGARDS THE MERITS OF GROUND NO. 2 THE LD. CIT(A) DULY EXAMINED THE AGREEMENT OF SALE OF LAND THE BANK STATEMENT A ND CASH FLOW STATEMENT FILED BY THE ASSESSEE. THE ASSESSEE WAS FOUND TO HAVE RECEI VED ADDITIONS FROM TIME TO TIME AGAINST THE AGREED CONSIDERATION OF RS.3 10 00 000/ - FOR SALE OF HIS PROPERTY TO GROVER DEVELOPERS WHICH SALE WAS AGREED UPON VIDE AGREEMENT DATED 9/10/2012. DURING F. Y 2007-08 RELATING TO THE YEAR UNDER CON SIDERATION THE ASSESSEE WAS ITA NO. 2432/DEL/13 7 FOUND TO HAVE RECEIVED A TOTAL SUM OF RS.20 50 000/ - IN CASH FROM SHRI B. DIWAN SINGH PAN BKDPS7718H WHICH HAS BEEN FOUND TO BE A S PER THE CONFIRMATION FILED BY THE PAYEES/BUYERS. THE CONFIRMATION FROM THE PARTNERS OF GROVER DEVELOPERS WHICH CONFIRMATION WAS NOTARIZED AND W AS ON STAMP PAPER SHOWED THAT THE ASSESSEE HAD BEEN PAID RS.10 LAC AND RS.5L AC BY CHEQUE ON 6/7/2007 & 7/1/08 RESPECTIVELY. THE ASSESSEE WAS FOUND TO HA VE RECEIVED CASH OF RS.20 50 000/- THROUGH SHRI DIWAN SINGH FATHER OF SHRI SURENDER SINGH GROVER PARTNER OF M/S GROVER DEVELOPERS. THE CASH FLOW ST ATEMENT SHOWED WITHDRAWAL OF CASH OF RS.14 LACS ON VARIOUS DATES AND RE-DEPOSIT OF RS.10 LACS. AS PER THE CASH FLOW STATEMENT THE DEPOSITS IN THE BANK TALLIED WI TH THE CASH ADVANCE RECEIVED BY THE ASSESSEE FROM THE BUYERS. 11. IT WAS AFTER HAVING DULY TAKEN INTO CONSIDERATI ON ALL THE ABOVE THAT THE LD. CIT(A) DELETED THE ADDITION. BEFORE US THE DEPART MENT HAS NOT BEEN ABLE TO DISPUTE THE CATEGORICAL FINDINGS OF FACT RECORDED BY THE LD . CIT(A). ACCORDINGLY WE UPHOLD THESE FACTUAL FINDINGS. THEREFORE GROUND NO. 2 IS REJECTED. 12. CONCERNING GROUND NO. 3 THE AO DISALLOWED THE ASSESSEES CLAIM OF DEDUCTION UNDER CHAPTER VI A OF THE ACT AMOUNTING TO RS.1 LAC OBSERVING THAT THE ASSESSEE HAD FAILED TO PROVIDE ANY SUPPORTING DOCUM ENTS. THE CIT(A) DELETED THIS DISALLOWANCE. THE DEPARTMENT CONTENDS THAT THIS DI SALLOWANCE WAS ILLEGALLY DELETED BY THE LD. CIT(A) ON THE BASIS OF ADDITIONAL EVIDEN CE FILED BY THE ASSESSEE. 13. HERE IT REMAINS UNDISPUTED THAT THE ASSESSEE H AD INVESTED THE AMOUNT TO RS.1 LAC THROUGH HIS AXIS BANK ACCOUNT IN A TERM DEPOSIT . THE MERITS OF THE ACTION OF THE CIT(A) IN ADMITTING ADDITIONAL EVIDENCE HAVE BEEN D ISCUSSED AND UPHELD HEREINABOVE. SUCH INVESTMENT IN A TERM DEPOSIT IS UNDISPUTEDLY ELIGIBLE FOR DEDUCTION U/S 80C (2) (XXI) OF THE ACT AS CORRECTL Y HELD BY THE LD. CIT(A). AS SUCH FINDING NO INFIRMITY THEREIN THE CITS ACTION OF D ELETING THIS DISALLOWANCE IS ALSO UPHELD. GROUND NO. 3 IS REJECTED. ITA NO. 2432/DEL/13 8 14. IN THE RESULT THE APPEAL FILED BY THE DEPARTME NT IS DISMISSED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 17 TH OF APRIL 2014. SD/- SD /- (G. D. AGRAWAL) ( A. D. JAIN) VICE PRESIDENT JUDICIAL MEMBER DATED: 17/04/2014 *R. NAHEED* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT RE GISTRAR ITAT NEW DELHI