Shiv Kumar, Ramesh Sethi, 81-82, 1st Floor, Gokhale Market, Opp. Tis Hazari Courts New Delhi 110 054 Vs. ITO Ward -20(2) New Delhi.
September, 03rd 2015
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCHES : "G" NEW DELHI
BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER
SHRI T.S. KAPOOR, ACCOUNTANT MEMBER
ITA Nos. 3901,3902,3903/Del/2014
Assessment Years: 2008-09
Shiv Kumar, vs. ITO
Ramesh Sethi, 81-82, Ward -20(2)
1st Floor, New Delhi.
Opp. Tis Hazari Courts
New Delhi 110 054
Assessee by :- None
Department by:- Shri Sujit Kumar , Sr. DR
PER T.S. KAPOOR, ACCOUNTANT MEMBER
These are three appeals filed by assessee against the separate orders of
Ld. CIT(A) all dated 29/11/2013. ITA No. 3901/Del/2014 is against Ld. CIT(A)
order partly confirming the assessment completed by AO u/s 144 of the Income
Tax Act, 1961 whereas ITA No. 3902/Del/2014 relates to confirmation of penalty
imposed by AO u/s 271(1)(b) of the Income Tax Act, 1961 and ITA No.
3903/Del/2014 relates to confirmation of penalty u/s 271(1)(c) of the Income
2. These appeals were heard together. Therefore for the sake of convenience
a common and consolidated order is being passed. None was present on behalf
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Shiv Kumar vs. ITO
of assessee. However it was felt that the appeals can be disposed off even in the
absence of representative of assessee. Therefore with the help of Ld. DR the
facts of the case were examined.
3. Ld. DR pointed out that assessee initially filed return of income declaring
the income from business of automobile and auto parts and despite affording
many opportunities the assessee did not appear before AO and therefore AO had
to complete assessment u/s 144 of the Act. He further elaborated that assessee
had filed his return of income declaring income from automobile parts whereas
before Ld. CIT(A) he changed his stance and stated that he had earned income
from tuition and in fact before Ld. CIT(A) he also stated that the return was filed
by him by mistake and in fact he was not liable for income tax. Ld. DR submitted
that how can be a person file a return and then deny that it was not his return.
Therefore Ld. DR submitted that additions sustained by Ld. CIT(A) need to be
4. We have heard Ld. DR and have gone through the material available on
record. We find that AO had made various additions u/s 144 of the Act. The
relevant findings of AO imposing additions are reproduced as under :-
"A. In the return of income against sale, the assessee has shown the
total sales at Rs. 5,08,431/-. Whereas against the gross receipt at Rs.
4,43,903/- has been shown. No reason for the difference has been given. In
view of the above, the difference of the total turnover and gross receipt
which comes to Rs. 64,528/- is added to the total income of the assessee.
(Addition of Rs. 64,528/-)
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Shiv Kumar vs. ITO
B. No capital has been shown as utilized. It is not possible to do the
business without capital to make sale of Rs. 5,08,431/-. The assessee may
require atleast Rs. 1,00,000/- (approx) as his capital. As the assessee did
not show any capital, Rs. 1,00,000/ - is added to the income of the
assessee as investment u/s 68 of the IT Act.
(Addition of Rs. 1,00,000/-)
C. As per column 51 of the ITR the assessee has shown net profit of Rs.
2,10,750/- whereas as per the computation of income, the net profit has
been shown at 1,55,897/- only. On the basis of above, there is a net
difference of Rs. 54,853/- (2,10,750 - 1,55,897) in the profit declared by the
assessee. The difference of Rs. 54,853/- is added to the income of the
(Addition of Rs. 54,853/- )
D. As per the return, the assessee has shown gross expenses at Rs.
2,97,681/-. In the absence of the details of the expenses, it is difficult to
ascertain the nature of these expenses. In the absence of details, 1/4th of
the above expenses which comes to Rs. 74,420/- is disallowed and added
to the income of the assessee.
(Addition of Rs. 74,420/- )
E. As per return, in column No. 6, the assessee has shown sundry
creditors at Rs 19,872/-. No details of the creditors has been provided. The
onus lies on the assessee to prove the genuineness of the creditor which
the assessee failed. In the absence of the details, Rs. 19,872/- outstanding
against creditors is added to the. income of the assessee
(Addition of Rs. 19,872/-)
F. The assessee has claimed deduction under chapter VI-A at Rs. 3,400/- for
which no evidence of payment is available on record. In the absence of the
evidence, the same I. added to the income of the assessee.
(Addition of Rs. 3,400/- )"
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5. Ld. CIT(A) allowed part relief to the assessee by holding as under :-
"8,4 Thus it is seen that the Appellant has been shifting his stand regarding
the source of income, initially claiming in the Return that he was involved
in trading of Auto Parts etc., subsequently claiming that he was having
income from tuition and that he was running coaching Classes under the
name and style of 'Oasis Acadmy' and then subsequently claimed that he
had no income from tuition in the year under consideration. In view of
these contradictory and false claims of the Appellant, it is clear that the
claims of the Assessee are not reliable and it is apparent that the Assessee
making various claims just to avoid tax and penal liability.
8.5 It is claimed by the Assessee that the notices did not reach him and
hence he could not comply to the same. Perusal of the Assessment Order
u/s 144 dated 27.12.2010 in the case of the Assessee for the A.Y. 2008-09,
shows that the notice was served through affixture. In the absence of the
latest address of the Appellant the service by affixture upon the last known
address is fully valid. It is also seen that the Assessee has no evidence for
his claims that he went away from Delhi in December, 2008 and returned
back after two years in December 2010 and also that he did not receive
any notices from the Assessing Officer. On one hand the assessee claims to
be engaged in Automobile business, on the other hand claims that he is
having tuition income and running Oasis Academy and then, to avoid the
taxes and penalties claims that he was not having any income from tuition
in AY 08- 09 and has even filed an affidavit claiming that the Return for the
AY 08-09 was inadvertently filed, alongwith Balance Sheet, P&L Account
etc. There can be an inadvertent mistake, in some action but each and
every action can not be brushed aside, claiming it to be an inadvertent
action. The Assessee drew up his Balance Sheet, P&L Account etc. and even
filed Return on the basis of such documents; and now to avoid taxes and
penalties is claiming them to be inadvertently filed. In view of the nature of
the action, it is very clear that the conduct of the Assessee was deliberate,
it can not be taken as a minor inadvertent mistake.
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Shiv Kumar vs. ITO
8.6 The Assessee has claimed that he did not get reasonable opportunity
for making compliance before the Assessing Officer. However. it is seen
that sufficient opportunity was given to him in Appeal but the Assessee did
not avail of that opportunity and did not submit all the information,
details, documents etc. and rather changed his claims regarding the
income of the year under consideration after detailed queries were made
by Order Sheet entry dated 30.05.13 (in Appeal No. 82/11-12), and also did
not give the full details, documents and information etc. asked for. It .was
clear that the Assessee was evading in making compliance to escape from
the tax and penal liability. In view of this situation, each of the additions
made by the Assessing Officer were examined and other than an addition
of Rs. 1,00,0001- made on adhoc basis by the Assessing Officer, all other
additions were confirmed.
8.7 It is seen that the conduct of the Assessee was deliberate, and with an
intention to prevent the truth from coming out, the Assessee kept on
shifting his stand about his income for AY 08-09 and having initially
claimed in the Return that he was involved in trading of Auto Parts etc.,
subsequently claimed that he was having income from tuition and that he
was running coaching classes under the name and style or 'Oasis Acadmy'
and then subsequently claimed that he had no income from tuition in the
year under consideration. In view of these contradictory and false claims of
the Appellant, it is clear that the claims of the Assessee are not reliable and
it is apparent that the Assessee making various claims just to avoid tax and
8.8. The Assessing Officer has added an amount of Rs. 1,00,000/- on a
purely adhoc basis without any evidence for his contention that the
Assessee would have made an investment of Rs. 1,00,000/- which was
taxed by the Assessing Officer U/S 68 of the IT Act. The Assessee has stated
that the Appellant has already shown his actual investment in the Balance
Sheet. The Assessing Officer has not been able to point out any investment
by the Assessee over and above that shown in the Balance Sheet and
hence, I am unable to sustain this addition which is hereby deleted.
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8.9 The Assessing Officer has added a difference of Rs.54,853/- to the
income of the basis that the Assessee has disclosed net profit of Rs.
2,10,750/- whereas in the computation of income, the net profit has been
shown at Rs. 1,55,897/- only. In the absence of any proper explanation by
the Assessee, no relief can be given and this addition is hereby confirmed.
8.10 The Assessing Officer has disallowed l/4th of the expenses claimed at
Rs. 2,97,686/- in absence of the details of the expenses and has observed
that even the nature of these expenses cannot be ascertained. The
Assessee could not submit any evidence to controvert these observations.
though it was claimed in the Written Submissions dated 30.05.13 that all
the expenses are for business purpose only. It is noteworthy that the claim
of genuineness of expenses is contrary to the subsequent claims of the
Assessee. In view of the entire facts. the addition amounting to Rs 74/420/-
is hereby confirmed.
8.11 Sundry Creditors amount to Rs. 19,872/-- were added back to the
Income of the Assessee in the absence of any details and the Assessee
being unable to discharge the onus of proving the genuineness of the
Creditors. For this addition also the Assesee could not submit any evidence
to controvert these observations, though it was claimed in the written
Submissions dated 30.05.13 that all the Creditors are totally genuine. It is
noteworthy that the claim of genuineness sof Creditors is contrary to the
subsequent claims of the assesee. In view of the entire facts, the addition
amounting to Rs. 19,872/- is hereby confirmed.
8.12 The Assessee claimed deduction under Chapter-VIA amounting to Rs.
3,400/- which was disallowed in the absence of any evidence. No evidence
was given in the appellate proceedings also and hence the disallowance
has to be confirmed."
6. From the orders of authorities below making additions and partly confirming
them we find that both authorities have not passed speaking orders and
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Shiv Kumar vs. ITO
moreover the necessary clarifications stated by assessee were not properly
examined. Assessing Officer has also completed assessment u/s 144 of the Act.
Therefore in view of the substantial justice we are of the view that appeals
confirming the assessment and confirming the penalties needs to be looked after
again by AO. The AO will provide sufficient opportunity to the assessee of being
heard. In view of the above appeals filed by the assessee are allowed for
7. In the result, the appeals filed by the assessee are allowed for statistical
8. This decision was pronounced in the Open Court on 2nd September, 2015.
(H.S. SIDHU) (T.S. KAPOOR)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Dated: the 2nd September, 2015
Copy of the Order forwarded to:
6. Guard File By order
Sl. Description Date
1. Date of dictation by the Author 1.9..2015
8 ITA Nos. 3901,3902,3903/Del/2014
Shiv Kumar vs. ITO
2. Draft placed before the Dictating Member 2.9.2015
3. Draft placed before the Second Member
4. Draft approved by the Second Member
5. Date of approved order comes to the Sr. PS
6. Date of pronouncement of order
7. Date of file sent to the Bench Clerk
8. Date on which file goes to the Head Clerk
9. Date of dispatch of order