Indrajit Samanta, Kolkata v. I.T.O, Ward - 4, Haldia, Purba Medinipur

1 IN THE INCOME TAX APPELLATE TRIBUNAL 'B BENCH : KOLKATA (BEFORE HONBLE SRI B.R.MITTAL J.M. AND HON BLE SRI B.C.MEENA A.M.) I.T.A. NOS. 408 & 409 /KOL/2010 ASSESS MENT YEARS : 1987-88 89-90 INDRAJIT SAMANTA VS ITO WARD 4 HALDIA (PAN NO. AVSPS 2031 C) (APPELLANT) (RESPONDENT) APPELLANT BY : SR I MIRAJ D. SHAH. RESPONDENT BY : SRI PIYUSH KOLHE. O R D E R PER SHRI B.C.MEENA A.M. ITA NO. 408(KOL)/2010 THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A)- XXXVIII KOLKATA DATED 16.11.2009 FOR THE ASSESSM ENT YEAR 1987-88. 2. GROUNDS OF APPEAL RAISED ARE AS UNDER : 1. FOR THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE ASSESSMENT ORDER PASSED WAS IN VIOLATION OF PRINCIPLES OF N ATURAL JUSTICE HENCE IS BAD IN LAW AND BE QUASHED. 2. FOR THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE LEARNED CIT(A)-XXXIII KOLKATA ERRED IN DISMISSING THE AP PEAL FOR NON COMPLIANCE. 3. FOR THAT IN THE FACTS AND CIRCUMSTANCES OF T HE CASE THE CONDITIONS PRECEDENT TO THE REOPENING OF ASSESSMENT U/S 148 OF THE INCOME TAX ACT 1961 ARE NOT PRESENT HENCE THE REOPENING IS BAD IN LAW AND BE QUASHED. 4. FOR THAT THE LEARNED A.O. WARD -4 HALDIA E RRED IN ARRIVING AT THE CASH SHORTAGE WITHOUT CONSIDERING THE PROVISION OF ADJUSTMENT IN BANK ACCOUNT AMOUNTING TO RS.22 946/- FOR THE YEAR UNDE R CONSIDERATION AND ADJUSTMENT OF ADVANCES OF THE EARLIER YEAR TOGETHE R WITH BANK BALANCE AS ON 31.03.1986 AMOUNTING TO RS.18 230/-. THUS THERE WAS NO CASH SHORTAGE. 5. THE APPELLANT CRAVES LEAVE TO PRESS NEW ADDITIONAL GROUNDS OF APPEAL AMEND AND/OR MODIFY WITHDRAW ANY OF THE ABOVE GROUNDS BEFORE OR AT THE TIME OF HEARING OF THE APPEAL. 2 3. AT THE TIME OF HEARING OF THE APPEAL THE LEARNE D A.R. FAIRLY CONCEDED THAT THERE IS NO MERIT IN ALL THE GROUNDS IN THE APPEAL OF THE ASSESSEE. THE LEARNED D.R. RELIED ON THE ORDER OF THE A.O. AND CIT(A). HE P LEADED THAT SHORTAGE OF CASH HAS BEEN WORKED OUT ON THE BASIS OF ASSESSEES A/CS AND THE ADDITION IS JUSTIFIED. 4. AFTER HEARING BOTH THE SIDES WE FIND THAT THE A.O. WORKED OUT THE CASH SHORTAGE ON THE BASIS OF THE ACCOUNT OF THE ASSES SEE. AS PER THIS ACCOUNT THERE WAS A SHORTAGE OF CASH OF RS.56 675. THE ASSESSEE FAILED TO EXPLAIN THE SHORTAGE OF CASH BEFORE THE A.O. AS WELL AS BEFORE THE CIT( A). DURING THE PLEADINGS ALSO THE LEARNED A.R. FAIRLY CONCEDED ON THIS ISSUE. K EEPING THESE FACTS IN VIEW WE FIND NO MERIT IN THE APPEAL OF THE ASSESSEE. 5. IN THE RESULT THE ASSESSEES APPEAL IS DISMISSE D. I.T.A.NO. 409(KOL)/10 6. THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGA INST THE ORDER OF THE CIT(A)-XXXIII KOLKATA DATED 17.11.2009 FOR THE A SSESSMENT YEAR 1989-90. 7. GROUNDS RAISED ARE AS FOLLOWS : 1. FOR THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE ASSESSMENT ORDER PASSED WAS IN VIOLATION OF PRINCIPLES OF N ATURAL JUSTICE HENCE IS BAD IN LAW AND BE QUASHED. 2. FOR THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE LEARNED CIT(A)-XXXIII KOLKATA ERRED IN DISMISSING THE AP PEAL FOR NON COMPLIANCE. 3. FOR THAT IN THE FACTS AND CIRCUMSTANCES OF T HE CASE THE CONDITIONS PRECEDENT TO THE REOPENING OF ASSESSMENT U/S 148 OF THE INCOME TAX ACT 1961 ARE NOT PRESENT HENCE THE REOPENING IS BAD IN LAW AND BE QUASHED. 4. FOR THAT IN THE FACTS AND CIRCUMSTANCES O F THE CASE THE LD. A.O. WARD-4 HALDIA ERRED IN ARRIVING AT THE CASH SHORTA GE WITHOUT CONSIDERING THE REVISED BALANCE SHEET SUBMITTED FOR THE ASSE SSMENT YEAR 1988-1989. 5. FOR THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE LEARNED A.O. ERRED IN ADDING BACK A SUM OF RS.21 548/- TO THE TOTAL INCOME OF THE ASSESSEE TREATING THE SAME AS ALLEGED DEFLATION O F WRITTEN DOWN VALUE OF BUS WITHOUT CONSIDERING THE REVISED BALANCE SHEE T. THE ADDITION IS UNJUSTIFIED AND BE DELETED. 8. THE LEARNED A.R. DID NOT PRESS GROUND NOS. 1 2 3 & 4. THESE ARE THEREFORE DISMISSED AS NOT PRESSED. 3 9. WHILE PLEADING ON GROUND NO. 5 THE LEARNED A. R. SUBMITTED THAT THE WRITTEN DOWN VALUE AS ON 31.3.88 WAS OF RS.99 763 A ND AFTER REDUCING THE DEPRECIATION @ 40% FOR THE ASSESSMENT YEAR 1989-90 (YEAR UNDER CONSIDERATION) THE VALUE OF THE ASSETS SHOULD HAVE BEEN RS.59 858 WHILE THE ASSESSEE HAS SHOWN RS.38 310. THE A.O. MADE ADDITION ON ACCOUNT OF DEFLATION OF THE VALUE OF THE ASSET AT RS.21 548. HE SUBMITTED THAT HOW THE A. O. CAN MAKE THE ADDITION IN THE CASE WHERE THERE IS DEFLATION IN THE VALUE OF THE ASSETS. 10. ON THE OTHER HAND THE LEARNED D.R. SUBMITTED THAT SINCE THERE IS DISCREPANCY IN THE BALANCE SHEET AND BOTH THE SIDES OF THE BALANCE SHEET NEED TO BE TALLIED THE DEFLATION IN VALUE OF ASSETS HAD BEEN COMPENSATED BY OTHER SIDE. THIS ISSUE NEEDS TO BE THRUSHED OUT AT THE LEVEL OF TH E CIT(A) OR A.O. THE CIT(A) HAD ALSO NOT DECIDED THE ISSUE ON MERITS. THERE FORE IN THE INTEREST OF JUSTICE THE MATTER MAY BE RESTORED BACK TO THE FILE OF THE CIT(A). 11. AFTER HEARING BOTH THE SIDES CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN THE INTEREST OF EQUITY AND JUSTIC E WE RESTORE THE APPEAL TO THE FILE OF THE CIT(A) TO BE DECIDED DE NOVO AFTER PROVIDIN G DUE OPPORTUNITY OF HEARING TO THE ASSESSEE. 12. IN THE RESULT ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 30.4.2010 SD/- SD/- (B.R.MITTAL) (B.C.MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 30.4.2010 COPY FORWARDED TO :- 1) ITO WARD-4 HALDIA. 2) INDRAJIT SAMANTA C/O D.J.SHAH & CO. KALYAN BHAVAN 2 ELGIN ROAD KOLKATA-700 020. 3) CIT(A) KOLKATA. 4) CIT KOLKATA. 5) D.R. ITAT KOLKATA. BY ORDER ASSISTANT REGISTRAR I.T.AT. KOLKATA. BCD