ITO, Bijnor v. Sh. Sanjeev Rajan Agarwal, Bareilly

ITA 3926/DEL/2009 | 2006-2007
Pronouncement Date: 10-05-2010 | Result: Dismissed

Appeal Details

RSA Number 392620114 RSA 2009
Assessee PAN AGCPA4546K
Bench Delhi
Appeal Number ITA 3926/DEL/2009
Duration Of Justice 7 month(s) 22 day(s)
Appellant ITO, Bijnor
Respondent Sh. Sanjeev Rajan Agarwal, Bareilly
Appeal Type Income Tax Appeal
Pronouncement Date 10-05-2010
Appeal Filed By Department
Order Result Dismissed
Bench Allotted G
Tribunal Order Date 10-05-2010
Date Of Final Hearing 10-05-2010
Next Hearing Date 10-05-2010
Assessment Year 2006-2007
Appeal Filed On 18-09-2009
Judgment Text
I.T.A. NO.3924 3925 3926 /DEL/2009 C.O.NO.15 16 17/DEL/2009 1/7 IN THE INCOME TAX APPELLATE TRIBUNAL NEW DELHI BENCH G BEFORE SHRI A.D. JAIN JUDICIAL MEMBER AND SHRI A K GARODIA ACCOUTANT MEMBER ITA NO. 3924 3925 3926 /DEL/2009 (ASSESSMENT YEAR 2004-05 2005-06 & 2006-07) ITO WARD II VS. SANJEEV RANJAN AGARWAL GURDWARA ROAD RAM BAGH COLONY BIJNOR CIVIL LINE BAREILLY. C.O. NO.15 16 17/DEL/2010 (ASSESSMENT YEARS 204-05 2005-06 & 2006-07 RESPECT IVELY) SANJEEV RANJAN AGARWAL VS. ITO WARD II RAM BAGH COLONY GURDWARA ROAD BIJNOR. CIVIL LINES BAREILY. (APPELLANTS) (RESPONDENTS) PAN / GIR NO. AGCPA4546K APPELLANT BY: SHRI NIKHIL CHAUDHARY SR. DR RESPONDENT BY: SHRI PIYUSH KAUSHIK ADV. ORDER PER BENCH: 1. THESE THREE APPEALS ARE FILED BY THE REVENUE AND THREE CROSS OBJECTIONS ARE FILED BY THE ASSESSEE WHICH AR E DIRECTED AGAINST A CONSOLIDATED ORDER OF LD. CIT(A) BAREILLY DATED 08.07.2009 FOR THE ASSESSMENT YEARS 2004-05 2005-06 & 2006-07. ALL THESE APPEALS AND THE I.T.A. NO.3924 3925 3926 /DEL/2009 C.O.NO.15 16 17/DEL/2009 2/7 CROSS OBJECTION WERE HEARD TOGETHER AND ARE BEING DISPOSED OFF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. FIRST WE TAKE UP THREE CROSS OBJECTIONS FILED B Y THE ASSESSEE. AN IDENTICAL GROUND IS RAISED BY THE ASS ESSEE IN THESE THREE CROSS OBJECTIONS WHICH READS AS UNDE R: THAT ON THE FACT AND CIRCUMSTANCES OF THE CASE AND IN THE LAW THE ENTIRE BASIS FOR THE ADDITIONS MADE IN THE COURSE OF RE-OPENING OF ASSESSMENT VIZ. EMBEZZLEMENT BY THE ASSESSEE IS INCORRECT AS THE CHARGE OF EMBEZZLEMENT FRAMED BY THE CONCERNED DEPARTMENT HAS BEEN QUASHED BY THE ORDER OF STATE PUBLIC SERVICES TRIBUNAL WHICH HAS ALSO BEEN APPROVED BY THE JURISDICTIONAL HIGH COURT HAD THEREFORE THE ADDITIONS MADE IN THE ORDER OF REOPENING OF ASSESSMENT ARE UNSUSTAINABLE IN LAW. 3. BRIEFLY STATED THE FACTS ARE THAT IN THESE THRE E YEARS IT IS NOTED BY THE A.O. THAT THE ASSESSEE HAS DEPOSITED C ERTAIN AMOUNTS OF CASH IN HIS BANK ACCOUNT NO.2564 WITH PUNJAB NATIONAL BANK BIJNOR BRANCH. IN ASSESSMENT YEAR 2004-05 IT IS NOTED BY THE A.O. THAT THE ASSE SSEE HAS DEPOSITED AN AMOUNT OF RS.5 LACS IN HIS BANK ACCOUNT. IT WAS SUBMITTED BY THE ASSESSEE BEFORE T HE A.O. THAT THIS AMOUNT HAS COME FORM MANDI SAMITI BY CHEQUE AND THE SAME IS REFUNDABLE TO MANDI SAMITI. THEREAFTER IT WAS NOTED BY THE A.O. THAT THE ASSES SEE HAS MADE EMBEZZLEMENT OF RS.45 25 728.97 DURING I.T.A. NO.3924 3925 3926 /DEL/2009 C.O.NO.15 16 17/DEL/2009 3/7 VARIOUS YEARS AND THE AMOUNT OF EMBEZZLEMENT DURING THE ASSESSMENT YEAR 2004-05 IS NOTED AT RS.22.21 LA CS FOR WHICH IT WAS HELD BY THE A.O. THAT THE MONEY EMBEZZLED BY THE ASSESSEE HAS TO BE ASSESSED AS INC OME OF THE ASSESSEE AND BY MAKING THIS OBSERVATION HE MADE AN ADDITION OF RS.22.21 LACS IN THE INCOME OF THE ASSESSEE FOR THE ASSESSMENT YEAR 2004-05. SIMILARL Y IN ASSESSMENT YEAR 2005-06 IT WAS OBSERVED BY THE A.O . THAT DURING THIS YEAR THE ASSESSEE HAS DEPOSITED A N AMOUNT OF RS.7 LACS IN ACCOUNT NO.100008 WITH BANK OF BARODA AND AM AMOUNT OF RS.12.68 LACS IN ACCOUNT NO.2564 WITH PUNJAB NATIONAL BANK. THE A.O. NOTED THAT DURING THE ASSESSMENT YEAR 2005-06 THE AMOUNT OF EMBEZZLEMENT WAS RS.17 LACS AND ON THIS ACCOUNT THE A.O. HAD MADE AN ADDITION OF RS.17 LACS IN ASSESSMENT YEAR 2005-06. SIMILARLY IN ASSESSMENT YEAR 2006-07 IT IS NOTED BY THE A.O. THAT THE ASSE SSEE HAS DEPOSITED AN AMOUNT OF RS.2 LACS IN THE BANK AN D MADE ADDITION OF THE SAME. THE ENTIRE ADDITION IN ALL THE THREE YEAS WAS DELETED BY THE LD. CIT(A) ON THE BASIS THAT EMBEZZLEMENT AMOUNT DOES NOT BECOME THE INCOME OF THE EMPLOYEE WHO HAD MADE EMBEZZLEMENT. NOW IN THE CROSS OBJECTION IT IS THE CLAIM OF THE ASSESSEE THAT CHARGE OF EMBEZZLEMENT FRAMED BY THE I.T.A. NO.3924 3925 3926 /DEL/2009 C.O.NO.15 16 17/DEL/2009 4/7 CONCERNED DEPARTMENT HAS BEEN QUASHED BY THE ORDER OF THE STATE PUBLIC SERVICES TRIBUNAL WHICH HAS ALSO B EEN APPROVED BY THE HON'BLE JURISDICTIONAL HIGH COURT A ND HENCE THE VERY BASIS OF MAKING THE ADDITION DOES NO T SURVIVE. THE LD. A.R. FOR THE ASSESSEE HAS RELIED UPON THE JUDGEMENT OF HONBLE JURISDICTIONAL HIGH COURT IN THIS REGARD. LD. D.R. FOR THE REVENUE SUPPORTED THE ASSESSMENT ORDER. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS PERUSED THE MATERIAL ON RECORD AND HAVE GONE THROUGH THE ORDERS OF AUTHORITIES BELOW AND THE JUDGEMENT OF HON'BLE JURISDICTIONAL HIGH COURT RENDERED IN THE CASE OF T HE ASSESSEE REGARDING EMBEZZLEMENT. WE FIND THAT THE LD. CIT(A) HAS REPRODUCED THE RELEVANT PORTION OF THE DECISION OF THE STATE PUBLIC SERVICES TRIBUNAL LUCKNOW IN CLAIM PETITION NO.796/7 WHICH HAS BEEN PASSED ON 04.06.2009. THE SAME IS REPRODUCED HEREI N BELOW FROM PAGE 7 OF THE ORDER OF LD. CIT(A): THE CLAIM PETITION IS ALLOWED. THE IMPUGNED PUNISHMENT ORDER DATED 7.11.2006 AND ORDER ON APPEA L DATED 30.6.2007 INCLUDING ORDER OF RECOVERY ARE HER EBY QUASHED. CONSEQUENT TO THE PETITIONER WILL BE REIN STATED ON THE POST HE WAS HOLDING ON THE DATE OF HIS DISM ISSAL FROM SERVICE WITH CONTINUITY OF SERVICE FROM THE D ATE OF DISMISSAL TO THE DATE REINSTATEMENT. HOWEVER THE OPPOSITE PARTIES WILL BE AT LIBERTY TO CONDUCT THE INQUIRY AGAINST THE PETITIONER A FRESH AFTER CALLING HIS RE PLY TO I.T.A. NO.3924 3925 3926 /DEL/2009 C.O.NO.15 16 17/DEL/2009 5/7 THE CHARGE SHEET. THE CLAIM FOR SALARY AND OTHER ALLOWANCE FOR THE PERIOD FORM THE DATE OF SUSPENSIO N TILL THE DATE OF REINSTATEMENT AND THE RECOVERY ORDER AG AINST HIM VIDE IMPUGNED ORDERS SO QUASHED SHALL BE SUBJEC T TO OUT COME OF THE INQUIRY SO HELD. 5. THE ABOVE TRIBUNAL ORDER HAS BEEN APPROVED BY TH E ALLAHABAD HIGH COURT IN WRIT PETITION NO.1032(SB).2009 AS PER THE JUDGEMENT DATED 23.07.2009. THIS JUDGMENT OF HON'BLE HIGH COURT OF ALLAHABAD HAS ALSO BEEN FURNISHED BEFORE US BY THE LD. A.R. IN THE JUDGEMENT IT IS HELD BY THE HON'BLE H IGH COURT OF ALLAHABAD THAT THE ORDER OF PUNISHMENT HAS NOT BEEN SET ASIDE BY THE TRIBUNAL BEING SATISFIED THAT NO CHARGE IS MADE OUT AGAINST THE RESPONDENT NO.2 I.E. THE ASSESSEE BEFORE US. IT IS ALSO OBSERVED BY THE HON 'BLE HIGH COURT OF ALLAHABAD THAT THIS IS NOT THE FINDIN G OF THE TRIBUNAL THAT HE WAS NOT GUILTY OF ANY CHARGE. THE CHARGE REMAINED TO BE CONSIDERED AFRESH. IT WAS HE LD BY THE STATE PUBLIC SERVICES TRIBUNAL LUCKNOW THAT TH E OPPOSITE PARTY I.E. EMPLOYER WILL BE AT LIBERTY TO CONDUCT THE INQUIRY AGAINST THE PETITIONER I.E. THE ASSESSE E AFRESH AFTER CALLING HIS REPLY TO THE CHARGE SHEET. IT WA S HELD BY THE HON'BLE HIGH COURT OF ALLAHABAD THAT THE RESPONDENT NO.2 I.E. ASSESSEE BEFORE US HAS TO BE REINSTATED INTO SERVICES BUT IT IS ALWAYS OPEN TO T HE I.T.A. NO.3924 3925 3926 /DEL/2009 C.O.NO.15 16 17/DEL/2009 6/7 PETITIONER I.E. THE EMPLOYER IF PERMISSIBLE TO SU SPEND THE RESPONDENT BY PASSING FRESH ORDER PENDING INQUI RY. SINCE IN THE PRESENT CASE THE ADDITIONS WERE MADE BY THE A.O. ON THE BASIS OF ALLEGATION OF EMBEZZLEMENT AGAINST THE ASSESSEE THESE ADDITIONS CANNOT BE SUS TAINED IN THE LIGHT OF THESE ORDERS OF THE STATE PUBLIC SE RVICES TRIBUNAL LUCKNOW AND THE HON'BLE HIGH COURT OF ALLAHABAD BUT SINCE LIBERTY HAS BEEN GIVEN TO THE EMPLOYER OF THE ASSESSEE TO CONDUCT THE INQUIRY AGA INST THE PETITIONER AFRESH AFTER CALLING HIS REPLY TO TH E CHARGE SHEET WE WOULD LIKE TO OBSERVE THAT IN THIS SITUAT ION THE REVENUE IN THE PRESENT CASES WILL ALSO BE AT LIBER TY TO TAKE REMEDIAL MEASURES AFRESH AS PER LAW IF THEY SO DESIRE BUT THE PRESENT ASSESSMENT ORDERS CANNOT BE SUSTAINED BECAUSE THE BASIS OF THE ADDITION AS PER THE PRESENT ORDERS DO NOT SURVIVE AT PRESENT IN VIEW OF THE JUDGMENT OF THE TRIBUNAL AND THE HON'BLE HIGH COURT OF ALLAHABAD. WE THEREFORE ALLOW THIS GROUND OF ASSE SSEE IN ALL THE THREE YEARS SUBJECT TO THE OBSERVATIONS MADE BY US AS ABOVE. IN THE RESULT ALL THE THREE CROSS OBJECTION OF THE ASSESSEE ARE ALLOWED. 6. NOW WE TAKE UP THREE APPEALS FILED BY THE REVEN UE. IN VIEW OF OUR DECISION WITH REGARD TO THREE CROSS OBJECTIONS OF THE ASSESSEE VARIOUS GROUNDS RAISED BY THE I.T.A. NO.3924 3925 3926 /DEL/2009 C.O.NO.15 16 17/DEL/2009 7/7 REVENUE IN ITS APPEALS HAVE BECOME OF ACADEMIC INTE REST ONLY BECAUSE AS ALREADY HELD BY US WHILE DECIDING T HREE CROSS OBJECTIONS OF THE ASSESSEE THAT NO ADDITION C AN BE MADE IN THE HANDS OF THIS ASSESSEE IN ANY OF THE TH REE YEARS ON THE BASIS OF EMBEZZLEMENT BECAUSE THE ALLEGATION OF EMBEZZLEMENT WAS NOT QUASHED BY THE STATE PUBLIC SERVICES TRIBUNAL LUCKNOW AND THIS DECISION OF THE TRIBUNAL WAS CONFIRMED BY THE HON'B LE JURISDICTIONAL HIGH COURT. UNDER THESE FACTS AND CIRCUMSTANCES THE APPEALS OF THE REVENUE HAVE BECO ME INFRUCTUOUS AND ARE BEING DISMISSED AS SUCH. 7. IN THE RESULT ALL THE THREE APPEALS OF THE REVE NUE ARE DISMISSED WHEREAS ALL THE THREE CROSS OBJECTIONS OF THE ASSESSEE ARE ALLOWED. 8. THIS DECISION WAS PRONOUNCED IN THE OPEN COURT O N 10 TH MAY 2010. SD./- SD./- (A. D. JAIN) (A K GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED:10 TH MAY 2010 SP. COPY FORWARDED TO 1. APPELLANT 2. RESPONDENT 3. CIT TRUE COPY: BY ORDER 4. CIT(A) 5. DR DY. REGISTRAR ITAT NEW DELHI