Swami Nath Tiwari, Prop M/s Anjani Air Cargo, E-40, Street No.-1, West Vinod Nagar, Delhi-110092. Vs. ITO, Ward-39(4), New Delhi.
January, 22nd 2015
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH: `G' NEW DELHI
BEFORE SMT DIVA SINGH, JUDICIAL MEMBER
SH. B.C.MEENA, ACCOUNTANT MEMBER
(ASSESSMENT YEAR- 2009-10)
Swami Nath Tiwari, vs ITO,
Prop M/s Anjani Air Cargo, Ward-39(4),
E-40, Street No.-1, West Vinod Nagar, New Delhi.
Appellant by None
Respondent by Sh.Satpal Singh, Sr. DR
PER DIVA SINGH, JM
This is an appeal filed by the assessee against the order dated 22.02.2013 of
CIT(A)-XXVIII, New Delhi pertaining to 2009-10 assessment year. No one was
present on behalf of the assessee at the time of hearing. However on a perusal of
the material available on record it was considered appropriate to proceed with the
present appeal ex-parte qua the assessee appellant on merits. The record shows
that the assessee returned an income of Rs.2,82,357/- by way of filing of return on
30.09.2009 which was selected for scrutiny through CASS on the basis of AIR
information received. Accordingly after issuance of notice u/s 143(2) etc. the
assessment order was passed wherein by way of the additions made assessment
was concluded on an income of Rs.9,23,567/-. The record shows that considering
the assessee's claim of payment for rent amounting to Rs.4,62,000/-, the AO in
order to verify the genuineness of the rent claim to have been paid to Sh.
A.K.Bhutani issued notice u/s 133(6) and considering the reply dated 12.12.2011
concluded that the assessee had excessively claimed expenses in order to reduce its
2 I.T.A .No.-3884/Del/2013
taxable income. For ready-reference the relevant extract from the assessment
order is reproduced hereunder:-
"Further in order to verify the genuineness of rent claimed to have been paid
to Sh.A.K.Bhutani, notice u/s. 133(6) has been sent to Sh.A.K.Bhutani. In
response to said notice Sh.J.P.Bhutani vide letter dated 12.12.2011 intimated
this office that "the above said premises at 7293, Gali No.1, Aram Nagar,
Qutub Road, Delhi-110055 comprises of one room on the ground floor has
been let out to M/s Anjani Air Cargo, Proprietor Mr. Swami Nath Tiwari at a
monthly rent of Rs.3,200/- only." Whereas the assessee has claimed that he
paid Rs.9,000/- per month as rent and Rs.42,000/- per annum as repair and
maintenance charges to Sh.A.K.Bhutani and claimed expenditure under the
head rent excessively by Rs.1,11,600/-"
2. A perusal of the grounds raised by the assessee before the CIT(A) shows
that the order passed by the AO dated 24.12.2011 was assailed to be an ex-parte
order. For the same, Ground No.-1 is reproduced hereunder:-
"1. That the ex-parte assessment order dated 24.12.2011 framed by Ld.
ITO Ward-26(3), New Delhi is against the law and facts of the case."
3. A perusal of the impugned order shows that the CIT(A) dismissed the
contention of the assessee that it was an ex-parte order in view of the fact that the
order stated that it is passed u/s 143(3). The other grounds i.e Ground Nos.-2 & 3
before the CIT(A) were dismissed as not requiring adjudication, the same are
reproduced hereunder for ready-reference:-
2. "That the Ld. ITO 39(4) New Delhi has erred in law in framing the
assessment order without affording the proper and sufficient opportunity to the
assessee to plead and represent his case and to fill the relevant papers and
documents in connection with the assessment proceedings.
3. That the Ld. ITO, Ward-39(4), New Delhi has not following the rules
and principles of natural justice before framing the assessment order."
4. In view of the above that the addition made by the AO was sustained. We
have heard the Ld. Sr. DR who placed reliance on the impugned order. However
on consideration of the material available on record, we are of the view that in the
interests of substantial justice the orders of the CIT(A) and the AO deserve to be
set aside. The issue is restored back to the file to the AO. Considering Ground
No.-3 raised before us directing the AO to decide the issues by way of a speaking
order denovo in accordance with law after giving the assessee a reasonable
3 I.T.A .No.-3884/Del/2013
opportunity of being heard. The said order was pronounced in the open Court in
the presence of the parties.
5. In the result the appeal of the assessee is allowed.
The order is pronounced in the open court on 19th of January 2015.
(B.C.MEENA) (DIVA SINGH)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Copy forwarded to:
5. DR: ITAT
ITAT NEW DELHI
4 I.T.A .No.-3884/Del/2013
"1. That on the facts and in the circumstances of the case, the learned
CIT(A) has erred in law in bringing to tax the amount paid as rent and
maintenance charges amounting to Rs.462000.00 on which purportedly no tax
has been deducted at source under the provisions of Section 194I of the Act"
"2. That as per law the appellant did not fall under the purview of Section
194 I of the Act as according to the facts available on record, he had paid rent
to 3 different persons which was separately below Rs. One Lakh Twenty
Thousand in a financial year and both the Assessing Officer as well as the
learned CIT(A) have erred on this account;
3. That the purported statement of one, Mr. J.P.Bhutani, on behalf of the
landlord Shri A.K.Bhutani, who has stated the rent paid as Rs.3200.00 per
month, has been relied by the Assessing Officer behind the back of the
appellant and flouting the principles of natural justice by not affording an
opportunity to him for cross examination etc. and to that extent the order
passed by the Assessing Officer and upheld by the CIT(A is bad in law;"