ITO, New Delhi v. M/s. Technet Global Pvt. Ltd, New Delhi

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH `E: NEW DELHI BEFORE SHRI G.E. VEERABHADRAPPA VICE PRESIDENT AND SHRI C.L. SETHI JM I.T. A. NO.4023/DEL OF 2009 ASSESSMENT YEAR: 2006-2007 INCOME-TAX OFFICER M/S TECHNET GLOBAL PRIV ATE LIMITED WARD 16(2) NEW DELHI. VS S-2 ANUPAM PLAZA HAUZ KHAS NEW DELHI. APPELLANT RESPONDENT APPELLANT BY: SHRI G.S. SAHOTA RESPONDENT BY: NONE ORDER PER C.L. SETHI JM: THE ONLY ISSUE RAISED IN THIS APPEAL FILED BY THE R EVENUE AGAINST THE ORDER DATED 20.7.2009 PASSED BY THE LEARNED CIT(A) FOR THE ASSTT. YEAR 2006-07 IS AS UNDER: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) ERRED IN DELETING ADDITION OF RS.10 00 000/- MADE U/S 68 OF THE I.T. ACT 1961 ESPECIALLY WHEN IDENTITY AND CREDITWORTHINESS OF THE PARTIES AND GENUINENESS OF TRANSACTIONS WERE NOT ESTABLISHED SATISFACTORILY. 2 2. WE HAVE HEARD THE LEARNED. NONE FOR THE ASSESSE E WAS PRESENT IN SPITE OF VARIOUS NOTICES ISSUED FROM TIME TO TIME TO THE ASSESSEE. 3. IN THE ASSESSMENT AN ADDITION OF RS.10 LACS ON ACCOUNT OF UNEXPLAINED CREDIT HAS BEEN MADE BY THE AO BY OBSERVING THAT AS SESSEE HAS FAILED TO DISCHARGE ITS ONUS OF PROVING THE IDENTITY AND CRED ITWORTHINESS OF THE CONCERNED PARTY AND GENUINENESS OF TRANSACTIONS IN TERMS OF SECTION 68 OF THE ACT. IT WAS NOTICED BY THE AO THAT ASSESSEE GA D SHOWN CERTAIN TRANSACTIONS OF RECEIVING MONEY FROM THE FOLLOWING THREE PERSONS:- (I) M/S SPG FINVEST P. LTD. RS. 7 LACS (II) M/S SWEN REALTY & MEDIA P. LTD. RS. 1 LAC (III) M/S NORTH INDIA SECURITIES P. LTD. RS. 2 LAC S THOUGH THE ASSESSEE PRODUCED CONFIRMATION LETTER FR OM THESE PARTIES AND THEIR BANK ACCOUNT IT WAS NOTICED BY THE AO THAT I MMEDIATELY BEFORE THE PAYMENT WAS ALLEGEDLY MADE TO THE ASSESSEE CERTAIN DEPOSITS IN CASH ON THE SAME DAY WERE MADE AND AMOUNT WAS ALSO WITHDRAWN ON THE SAME DATE. THE AO ALSO NOTICED CERTAIN DISCREPANCIES AS TO THE DAT E OF THE TRANSACTION VIS-- VIS THE ENTRY MADE IN THE BOOKS OF ACCOUNTS IN THE CASE OF M/S SWEN REALITY AND MEDIA P. LTD. THE AO ASKED THE ASSESSEE TO PRO DUCE THE RESPECTIVE PERSONS FOR EXAMINATION BUT NONE OF THEM WERE PRODU CED BEFORE THE AO. BEFORE THE LEARNED CIT(A) THE ASSESSEE SUBMITTED T HAT ON 22.12.2008 THE ASSESSEE WAS ASKED FOR THE FIRST TIME TO PRODUCE TH E PARTIES ON 24.12.2008. 3 THE ASSESSEE THEN IMMEDIATELY CONTACTED THOSE PARTI ES AND INTIMATED THEM ON 23.12.2008 TO APPEAR BEFORE THE AO ON 24.12.2008 . 25 TH DECEMBER 2008 WAS A HOLIDAY AND THEREAFTER ON 26.12.2008 THE AS SESSEE INTIMATED THE AO THAT ASSESSEE HAD MADE A REQUEST TO THOSE PARTIES T O APPEAR BEFORE THE AO ON 24.12.2008. IT WAS FURTHER SUBMITTED THAT DUE TO I NADEQUATE NOTICE I.E. INADEQUATE TIME THESE PARTIES COULD NOT APPEAR BEF ORE THE AO. IT WAS FURTHER SUBMITTED THAT AO CALLED THE INFORMATION AT THE FAG END OF THE TIME BAR TO PASS THE ASSESSMENT ORDER AND WAS RUSHED THROUGH WI THOUT GIVING SUFFICIENT OPPORTUNITY TO THE ASSESSEE TO PRODUCE THE PARTY BE FORE HIM OR OTHERWISE GIVING ANY OPPORTUNITY TO THESE PARTIES TO APPEAR B EFORE HIM. WE HAVE CONSIDERED THIS ASPECT OF THE MATTER AND WE FIND TH AT NO SUFFICIENT TIME WAS GIVEN EITHER TO THE ASSESSEE TO PRODUCE THESE PARTI ES OR TO THE PARTIES TO APPEAR BEFORE THE AO. THE AO HAD GIVEN ONLY TWO DA YS TIME WHICH IN OUR CONSIDERED OPINION WAS NOT REASONABLE AND SUFFICIE NT FOR ANYONE TO COMPLY THE AOS REQUEST. THE AO THEN COMPLETED THE ASSESS MENT ON 30.12.2008 HAVING NO TIME TO GIVE A FURTHER OPPORTUNITY TO THE ASSESSEE. WE ARE THEREFORE OF THE CONSIDERED OPINION THAT THE ASSES SEE OR THE CONCERNED PERSONS WERE NOT GIVEN ADEQUATE AND REASONABLE OPPO RTUNITY TO APPEAR BEFORE THE AO. THIS FAILURE ON THE PART OF THE AO HOWEVER CANNOT BE A GROUND TO DELETE ADDITION IN TOTO DELETED BY THE CI T(A). WE THEREFORE SET 4 ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND RESTO RE THE MATTER BACK TO THE FILE OF AO FOR HIS FRESH ADJUDICATION. THE AO SHALL PROVIDE REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE AO SHALL ALSO ISSUE SUMMONS U/S 131 TO THE RESPECTIVE PARTIES GIVING SU FFICIENT TIME FOR APPEARANCE. THE AO SHALL MAKE SUCH ENQUIRY AS HE T HINKS FIT AND PROPER SO THAT THE MATTER CAN BE DECIDED IN ITS RIGHT AND COR RECT PERSPECTIVE. WE ORDER ACCORDINGLY. 4. IN THE RESULT THE APPEAL FILED BY THE REVENUE I S ALLOWED FOR STATISTICAL PURPOSE. THIS DECISION WAS PRONOUNCED IN THE OPEN COURT ON 2 7 TH APRIL 2010 IMMEDIATELY AFTER THE HEARING WAS OVER. (G.E. VEERABHADRAPPA) (C.L. SETH I) VICE PRESIDENT JUDICIAL MEMBER DATED: APRIL 2010 VIJAY COPY TO: 1. APPELLANT. 2. RESPONDENT. 3. CIT 4. CIT(A)-XIX NEW DELHI 5. DR ASSISTANT REGISTRAR