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TMI Blog2014 (9) TMI 116X X X X Extracts X X X X X X X X Extracts X X X X ..... and circumstances of the case, the learned CIT(A) has erred both on facts and in ignoring the fact that the amount of Rs. 1,66,05,000/- being the sale proceeds having been included in the income, the same cannot be again included under Section 68 of the Act. (ii) That the above said addition without rejecting the books of accounts and the income computed on the basis thereof is unsustainable in the eye of law. 4. On the facts and circumstances of the case, the Leaned CIT(A) has erred both on facts and in confirming the chargeability of the interest under section 234B of the Act. 5. The Appellant craves leave to add, amend or alter any of the grounds of appeal." 2. The hearing in the present appeal took place on two difference dates. On the first date of hearing the Ld. AR opened his arguments by requesting that issue has to be restored back to the AO for verification of facts. The specific arguments taken in support of the said request shall be addressed separately however at the time of dictation clarification on facts was necessitates for which purposes the parties were heard again and Ld. AR fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... who has in her zest & zeal in order to support the additions made has repeatedly blundered variously not only in regard to this name but also at times recording the name of the Director as Arvind Kumar Modi instead of Arvind Kumar Maheshwari. It was his submission that even if these factual inaccuracies are accepted by the department inferences are drawn adverse to the assessee ignoring the fact that if at the convenience of the concerned party, power of attorney is given to a specific person to operate its bank accounts how can it be said that the transactions are not genuine all these aspects it was argued have not been looked into by the Revenue. The view it was submitted on facts has been taken without considering the reply of the assessee. The receipt of the reply made by the assessee in the DAK before the AO it was submitted has been accepted by the AO as would be evident from para 7 which is reply to para 11 of the information sought recorded in page 19 of the impugned order and this reply it was submitted needs to be considered on merit by the AO which has not been done. Accordingly it was his request that the issue may be restored for verification on facts. 6. In reply t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same it was his argument that the department may be directed to disclose now the outcome of the enquiry fixing responsibility. It was his stand that there is sufficient evidences on record to address the aspect that justice has not been done and not only wrong facts and names have been carelessly recorded even facts qua the attendance on a specific date could be addressed only after the assessee was put to the unnecessary hardship of approaching the authority under the RTI Act and even then too whether any responsibility has been fixed or not is still not known. 9. Considering the said request in the light of the above arguments available on record it may be appropriate to extract the relevant portion of the assessment order reproduced in the impugned order from pages 3 to 5 as under:- "During the assessment proceedings, the letters u/S 133(6) was issued to the various parties which remained uncomplied with. The call letter issued to M/s Stitch Creations Pvt. Ltd., 69, FF Nehru Commercial Complex, Lawrence Road, Amritsar-143001 also remained unattended to/ no details were filed. Another notice u/S 133(6) issued to M/s Moral Papers Pvt. Ltd., 55/25, Kalab Devi R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fying the above statement, and documents, a summon u/s 131 were issued to Directors of the company. In response to which counsel filed letter dated 22.10.08 and could not produce the Directors stating that personal attendance is not required. Fresh summons for personal requirements of the directors of the said company were issued on 23.10.2008 fixing the case on 03.11.2008, none attended. A summon was also issued to Mr Praveen Kumar Maheshwari. Nobody attended on this day. On 04.11.2008 A show Cause was issued fixing the case for 12.11.2008. None attended. The verification of bank statements for the period reveals that the assessee company used to deposit cheque and issue the same on the same day or within 1 or 2 days. The transaction is normally dealt with account number 4433, 4592, 4598, 4588 and 15713. The reflection of the statement reveals that there are huge transactions of amounts received and paid to various parties. The frequency of deposit/withdrawal of cash/cheques in the bank accounts are by way of transfer/withdrawal of cash/cheques in the bank accounts are by way of transfer/clearing entries, which are immedi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xplain about the nature and source of the deposits. The value of the deposits is hereby deemed to be the income of the assessee company during the financial year. In view of above, 1 am constrained to make the additions of deposits amounting to Rs. 1,66,05,000/- as unexplained, unverifiable and undisclosed income u/s 68 of the IT Act." 10. The record shows that aggrieved by this the assessee came in appeal before the CIT(A). Before whom based on information sought under the RTI Act, 2005 which was denied to the assessee by the CPIO against which the assessee appealed before the CIC. Detailed written submissions were filed before the CIT(A) as would be evident at page 6 of para 4.1 of the impugned order. The record shows that the CIT(A) sought Remand Report from the AO wherein he says that he has no objection if the nature of the business of the assessee is taken as engaged in the business of trading in shares, finance and investment etc instead of consultancy. Accordingly the CIT(A) was requested to decide the issue. A perusal of the impugned order further shows that the CIT(A) concludes that sufficient opportunity was afforded to the assessee to offer its explanation on 12.11.200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the impugned order it is seen that on behalf of the assessee it was submitted that the transactions have been confirmed in response to notice u/s 133(6) by way of various documents specifically alluded to at page 10 para 4.2 of the impugned order. It was further submitted that the AO's letter dated 04.11.2008 referred to in the Remand Report was replied to by letter dated 12.11.2008 which has been ignored by the AO and the information received under the RTI Act shows that it is available on the assessment records. The certified copy of the same was stated to be have been enclosed in the earlier submissions dated 11.12.2009. Accordingly based on the above facts aspersions were cast on the intention of the AO which came to light according to the assessee only after the receipt of information under the RTI Act. Similarly it was argued the reply of the Director in response to notice u/s 131 dated 03.11.2008 was also received under RTI Act which was also replied upon which again addresses the intention of the AO. Specific emphasis was laid on letter dated 12.11.2008 delivered at the DAK counter at page 2 para 6 filed on an earlier date. It was explained that upto the year under con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 12 of the impugned order is extracted hereunder:- "In regard to notice issued to the assessee co. for remand report it is humbly submitted that on the adjourned date the AR of the assessee co. attended the esteem office of the AO but he was not specified to submit any material or information. Under such circumstances the assessee company was not able to understand as to what should be submitted. Since all information/material were already on the assessment records." 13. A perusal of page 13 para 4.3 of the impugned order shows that the said reply of the assessee was forwarded to the AO who submitted his Remand Report dated 19.12.2010 and the incorrect mentioning of Prem Maheshwari instead of Praveen Kumar Maheshwari was accepted. Similarly the name Pawan Kumar Maheshwari wrongly mentioned in earlier Remand Report was accepted as mistake and requested that it should be read as "Praveen Kumar Maheshwari". The said reply was also made available to the assessee who further objected that the name of the Director has been taken by the AO as Arvind Kumar Modi instead of Arvind Kumar Maheshwari and merely because the operation of the bank account on behalf of the dir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of M/s. Joy Commercial Pvt. Ltd., Roop Yams Pvt. Ltd., Moral Papers Pvt. Ltd., Rose Alloys Pvt. Ltd. are being managed and operated by Shri Praveen Kumar Maheshwari which has been clarified by the AO in the remand report dated 9.12.2010 about which AR was granted opportunity wherein, he has not controverted this fact that Praveen Kumar Maheshwari is the person who is the authorized person to operate bank account of the company on behalf of Director Shri Arvind Kumar Maheshwari. Now this fact is well established, that even in the remand proceedings, opportunity was given by hearing dated 10.9.20 I 0 and 8.10.2011, which was not attended. So after taking into the observation of the AO in the assessment order as well as in the remand report, the matter is crystal clear that there are various paper companies whose bank accounts are being managed by Shri Praveen Kumar Maheshwari who was been authorized by Shri Arvind Kumar Maheshwari. Various opportunities were given during the course of assessment proceedings and remand proceedings which has not been complied with." 13.1. Reliance was placed by the CIT(A) on the judgement of CIT vs Oasis Hospitality Pvt. Ltd. 51 DTR 68 (Delhi); and I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... course of remand proceedings, proper opportunity was given which has not been availed. It has also been established by the AO that one Shri Praveen Kumar Maheshwari who is authorized signatory was found to be managing various bank accounts in the name of various companies. This fact has not been controverted by Ld. AR as to why Shri Praveen Kumar Maheshwari was working as authorized signatory to operate various bank accounts pertaining to different companies." 14. We have heard the rival submissions and perused the material available on record. On a careful consideration of the entire factual background of the case we are of the view that looking at the manner in which the relevant information qua the assessee's attendance on a specific date before the AO is concerned how the information has been initially blocked and thereafter made available only as a result of the appeal before the CIC there can be no two opinions that justice has not been done. The actions of the AO in mis-recording suppressing and thereafter obstructing necessary flow of information namely receipt of reply received by a director does not speak well of the manner in which the proceedings have been conducte ..... X X X X Extracts X X X X X X X X Extracts X X X X
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