ACIT, New Delhi v. M/s Rama Krishna Jewellers, New Delhi

ITA 4886/DEL/2010 | 2002-2003
Pronouncement Date: 04-01-2011 | Result: Dismissed

Appeal Details

RSA Number 488620114 RSA 2010
Bench Delhi
Appeal Number ITA 4886/DEL/2010
Duration Of Justice 1 month(s) 25 day(s)
Appellant ACIT, New Delhi
Respondent M/s Rama Krishna Jewellers, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 04-01-2011
Appeal Filed By Department
Order Result Dismissed
Bench Allotted F
Tribunal Order Date 04-01-2011
Date Of Final Hearing 22-10-2013
Next Hearing Date 22-10-2013
Assessment Year 2002-2003
Appeal Filed On 09-11-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: A NEW DELHI BEFORE SHRI RAJPAL YADAV JUDICIAL MEMBER AND SHRI SHAMIM YAHYA ACCOUNTANT MEMBER I.T.A NO. 4786/DEL/10 ASSTT. YEAR 1981-82 INCOME TAX OFFICER WARD 2 (2) NEW DELHI. VS. M/S. ASIA INSECTICIDES PVT. LTD. Z-418 B SECTOR-12 NOIDA-201301. (APPELLANT) (RESPONDENT) APPELLANT BY: MRS. ANUSHA KHURANA SR. DR. RESPONDENT BY: SHRI K.P. GARG CA ORDER PER RAJPAL YADAV JM: THE REVENUE IS IN APPEAL BEFORE US AGAINST THE ORD ER OF LD. CIT(A) DATED 23 RD AUGUST 2010 PASSED FOR ASSTT. YEAR 2002-03. THE R EVENUE HAS TAKEN THREE GROUNDS OF APPEAL OUT OF WHICH GROU ND NO. 3 IS GENERAL IN NATURE WHERE IT RESERVE ITS RIGHT TO AMEND AND MODIFY THE GROUNDS TAKEN BY IT. IN GROUND NO. 1 IT IS IMPUGNING THE DE LETION OF ` 10 LACS WHICH HAS BEEN ADDED BY THE AO ON THE GROUND THAT A SSESSEE HAS ITA NO. 4786/DEL/10 ASSTT. YEAR 2002-03 2 RECEIVED ACCOMMODATION ENTRY. IN GROUND NO. 2 IT IS IMPUGNING THE DELETION OF ` 26 500/- WHICH IS A LOSS CLAIMED BY THE ASSESSEE I N THE RETURN WHICH HAS NOT BEEN ALLOWED BY THE AO. 2. THE BRIEF FACTS OF THE CASE ARE THAT ASSESSEE IS A COMPANY. IT HAS FILED ITS RETURN OF INCOME ON 31 ST MARCH 2003 DECLARING A LOSS OF ` 26 500/-. ACCORDING TO THE AO HE RECEIVED AN INFOR MATION FROM INVESTIGATION WING WHEREBY IT WAS COMMUNICATED TO HIM THAT ASSESSEE HAD RECEIVED TWO ENTRIES OF ` 5 LACS EACH OF 7 TH FEBRUARY 2002 FROM SWETU STONE PV. HE NARRATED THOSE TWO ENTRIES AND T HEN FORMED AN OPINION THAT INCOME OF ASSESSEE HAS ESCAPED ASSESSM ENT. HE SOUGHT TO REOPEN THE ASSESSMENT OF THE ASSESSEE BY ISSUANCE O F NOTICE U/S 148. AS PER THE AO THE NOTICE DATED 27 TH MARCH 2009 WAS SERVED THROUGH AFFIXTURE ON 28 TH MARCH 2009. THE AO THEREAFTER HAS OBSERVED THAT NOTICES U/S 142 (1) WERE SERVED UPON THE ASSESSEE B UT UPTO 8 TH DECEMBER 2009 NO-ONE HAS APPEARED ON BEHALF OF THE ASSESSEE. ON 8 TH DECEMBER 2009 THE COUNSEL OF THE ASSESSEE SHRI VIJ AY BHALLA APPEARED AND FILED A LETTER REQUESTING FOR THE COPY OF THE R EASON FOR REOPENING OF THE CASE. THE AO FURTHER OBSERVED THAT REASONS WERE SUPPLIED TO THE COUNSEL ON 21.12.2009. ON 23.12.2009 THE ASSESSEE I NSTEAD OF FURNISHING THE INFORMATION NECESSARY FOR DISPOSAL O F THE CASE AGAIN RAISED OBJECTION AND SOUGHT FURTHER INFORMATION. TH E AO WITHOUT MAKING ITA NO. 4786/DEL/10 ASSTT. YEAR 2002-03 3 ANY DISCUSSION DISALLOWED THE LOSS CLAIMED BY THE A SSESSEE AND MADE THE ADDITION OF ` 10 LACS. HE SIMPLY OBSERVED THAT IT IS TIME BARRIN G ASSESSMENT HE HAS LEFT WITH NO OTHER ALTERNATIVE B UT TO COMPLETE THE ASSESSMENT ON THE BASIS OF INFORMATION AVAILABLE ON RECORD. 3. ON APPEAL LD. CIT(A) HAS DELETED THE ADDITION. L D. CIT(A) HAS OBSERVED THAT A PROPER SERVICE OF NOTICE U/S 142(1) 143(2) AND 148 ARE NOT DISCERNABLE IN THE RECORD. 4. WITH THE ASSISTANCE OF LD. REPRESENTATIVE WE HAV E GONE THROUGH THE RECORD CAREFULLY. THE CASE OF THE ASSESSEE IS T HAT IT HAS NOT RECEIVED ANY ENTRY FROM SWETU STONE PV. IT FURTHER SUBMITTED THAT IT IS NOT HAVING ANY BANK ACCOUNT ITSELF. THE ASSESSEE FURTHER CONTE NDED THAT IT SOUGHT THE COPY OF THE NOTICES ALLEGED TO HAVE BEEN SERVED UPON IT AND WHY THE NOTICE WAS ALLEGED TO HAVE BEEN SERVED DIRECTLY THR OUGH AFFIXTURE. LD. CIT(A) FOUND ALL THESE FACTS AS TRUE. IN HIS OPINIO N THE AO HAS NOT FOLLOWED THE RIGHT PROCEDURE PROVIDED IN SECTION 28 2 OF THE INCOME TAX ACT. ON DUE CONSIDERATION OF ALL THESE FACTS WE ARE OF THE OPINION THAT THE PRESENT APPEAL IS TOTALLY A FRIVOLOUS APPEAL AT THE END OF REVENUE. WE HAVE GONE THE REASONS RECORDED BY THE AO FOR REOPEN ING OF THE ASSESSMENT. IN THE REASONS IT IS NOWHERE PROVIDED W HO HAS ISSUED THE CHEQUE IN WHOSE FAVOUR. WHETHER IT IS ONE ENTRY OF ` 5 LACS OR THESE ARE TWO ENTRIES. THE AO HAS TO FIRST ESTABLISH THAT M/S . SWETU STONE PV HAD ITA NO. 4786/DEL/10 ASSTT. YEAR 2002-03 4 ISSUED TWO CHEQUES OF ` 5 LACS EACH IN FAVOUR OF THE ASSESSEE AND THESE HAVE BEEN CREDITED IN THE BANK ACCOUNT MAINTA INED BY THE ASSESSEE. THE OTHER ALTERNATIVE FOR THE AO COULD BE THAT ON PERUSAL OF THE ASSESSEES BOOKS OF ACCOUNT HE FOUND CREDIT EN TRIES OF THESE TWO ACCOUNTS AGAINST THE NAME OF SWETU STONE PV. HE H AS NOT POINTED OUT EITHER OF SUCH FACTS. WE FAIL TO UNDERSTAND WHY STR AIGHTWAY HE HAD ISSUED NOTICE THROUGH AFFIXTURE. THE PROCEDURE TO S ERVE THE NOTICE UPON THE ASSESSEE HAS BEEN PROVIDED U/S 282 OF THE INCOM E TAX ACT. INSTEAD OF SERVING THE NOTICE THROUGH AFFIXTURE HE SHOULD E XPLORE THE NORMAL PROCEDURE AS PROVIDED IN SECTION 282 OF THE INCOME TAX ACT. IT IS NOT DISCERNABLE IN THE ASSTTT. ORDER WHEN HE RECEIVED T HE INFORMATION FROM THE DIT AND WHEN HE APPLIED HIS MIND FOR FORMING AN OPINION THAT INCOME HAS ESCAPED ASSESSMENT AND NOTICE U/S 148 DESERVES TO BE ISSUED TO THE ASSESSEE. LD. CIT(A) HIGHLIGHTED ALL THESE LACU NA IN THE PROCEDURE ADOPTED BY THE AO INSPITE OF THAT REVENUE SOUGHT TO FILE THE SECOND APPEAL. THE AO FAILED TO ESTABLISH THE PRIMARY FACT S THAT ASSESSEE HAD RECEIVED ACCOMMODATION ENTRIES FROM M/S. SWETU STON E PV AND SUCH INCOME DESERVES TO BE ASSESSED IN ITS HAND. HE HAS NOT ANALYTICALLY EXAMINED WHAT IS THE NATURE OF INFORMATION SUPPLIED BY THE DIT?. IN AN ARBITRARY MANNER HE PROCEED TO MAKE THE ADDITION AN D DISALLOWED THE LOSS CLAIMED BY THE ASSESSEE. IN OUR OPINION IT IS A CLASSIC EXAMPLE OF ITA NO. 4786/DEL/10 ASSTT. YEAR 2002-03 5 HIGH HANDEDNESS AT THE END OF REVENUE. TAKING INTO CONSIDERATION ALL THE FACTS AND CIRCUMSTANCES WE DO NOT FIND ANY MERIT IN THIS APPEAL. IT IS DISMISSED. 5. IN THE RESULT THE APPEAL OF THE REVENUE IS DISMI SSED. ORDER PRONOUNCED IN THE OPEN COURT ON 4.1.2011. SD/- [SHAMIM YAHYA] [RAJPAL YADAV] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 4.1.2011 VEENA COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR ITAT TRUE COPY BY ORDER DEPUTY REGISTRAR ITAT