Ons Creations Pvt. Ltd., New Delhi vs Assessee

M/s. ONS Creations Pvt. Ltd., vs. ITO, Ward 13 (4), M - 2 / A4, Jhule Lal Apartment, New Delhi. Pitampura, New Delhi - 110 088.

(PAN : AAACO7606H)

(APPELLANT) (RESPONDENT)

ASSESSEE BY : Shri Ved Jain, FCA REVENUE BY : Shri P. Dam Kanunjna, Senior DR

Date of Hearing : 12.06.2015 Date of Pronouncement : 17.06.2015

ORDER

PER GEORGE GEORGE K., JUDICIAL MEMBER :

This appeal, at the instance of the assessee, is directed against the

order of the Commissioner of Income-tax (Appeals)-XVI, New Delhi

dated 30.09.2013. The relevant assessment year is 2005-06.

2. The assessment in assessee's case was completed u/s 144 of the

Income-tax Act, 1961 on 28.12.2007 at a total income of Rs.2,54,57,920/-

as against the returned income of Rs.1,30,730/-. The ld. CIT, Delhi V,

New Delhi passed an order dated 18.05.2009 u/s 263 and directed the 2 ITA No.6250/Del./2013

Assessing Officer to make addition of Rs.61,85,419/- to the assessee's

income on account of unexplained loans along with any interest claimed

on those loans and a further addition of Rs.40 lacs on account of

unexplained share capital as the assessee failed to establish before the CIT

during the proceedings u/s 263 the identity and creditworthiness of the

persons from whom the aforesaid loans and share capitals shown to have

been received. Against the order of the CIT passed u/s 263 of the Act, the

assessee filed an appeal before the Tribunal. The Tribunal, justifying the

order of the CIT Delhi V passed u/s 263, restored the matter back to the

Assessing Officer for providing an opportunity of being heard before

making any addition on the issues. In that view of the matter, the

Assessing Officer asked the assessee to explain its case on 13.01.2012 but

no compliance was made on the said date. The Assessing Officer gave

another opportunity and fixed the case for 06.02.2012 but on that day also,

nobody appeared on behalf of the assessee. Accordingly, the Assessing

Officer passed the assessment order giving effect to the order of CIT Delhi

V dated 18.05.2009 as amended by the Tribunal's order dated 27.05.2011

and completed the assessment on total income of Rs.3,56,43,339/- after

making addition on account of unexplained loans of Rs.61,85,419/- and on

account of unexplained share capital of Rs.40 lacs. 3 ITA No.6250/Del./2013

3. Aggrieved, the assessee preferred an appeal before the CIT

(Appeals). The CIT (A) confirmed the additions made by the Assessing

Officer.

4. The assessee, being aggrieved, is in appeal before us by taking eight

grounds.

5. At the outset of the hearing, the ld. Counsel has raised ground no.4

which reads as under :-

"4. On the facts and circumstances of the case, the learned CIT (A) has erred both on facts and in law in not admitting the additional evidences filed by the assessee under Rule 46A of the Act despite the fact that there was a reasonable cause for the assessee for not filing the same before the AO."

The ld. Counsel submitted that the Tribunal had earlier directed the

Assessing Officer to pass the assessment order after providing an

opportunity of being heard to the assessee, however, the Assessing Officer

passed the order ex-parte. The ld. Counsel submitted that no notice was

ever served on the assessee, therefore, there was no occasion for the

assessee to appear before the Assessing Officer. The ld. Counsel

submitted that additional evidences under Rule 46A of the Act were

produced before the CIT (A). The assessee pleaded before the CIT (A) to

accept these evidences as the same establishes the genuineness of the

transactions done by the assessee and go to the root of the additions made

by the Assessing Officer. It was also submitted that since these 4 ITA No.6250/Del./2013

documents/ evidences had been procured after completion of the assessee,

there was no occasion to file these evidences during the course of the

assessment. Ld. Counsel submitted that CIT (A) has erred in not accepting

the additional evidences which goes to the root of the matter. Therefore,

he pleaded to admit the additional evidences and restore the matter back to

the file of the Assessing Officer.

6. Ld. DR relied on the orders of the authorities below.

7. We have heard both the rival submissions and perused the material

on record. We find that the Tribunal has earlier restored the matter to the

Assessing Officer for providing an opportunity of being heard to the

assessee, however, the order was passed ex-parte. The assessee submitted

additional evidences under Rule 46A before the CIT (A) but the CIT (A)

has not admitted the same. We find from the order of the CIT (A) that the

CIT (A) himself recorded that the evidences filed by the assessee goes to

the root of the issues. The relevant finding of the CIT (A) reads as

follows:

"4.7 Without prejudice to the above, since the evidences filed by the appellant goes to the root of the issues in appeal, therefore, to decide the issue in appeal on merit, it is necessary to examine the evidences submitted by the appellant. From the original assessment order, it is evident that the books of accounts were never produced before the AO by the appellant, despite several opportunities allowed. As evident from the original assessment, the director and AIR appeared before the AO on several occasions but failed to produce the books of accounts despite repeated reminders by the AO to produce 5 ITA No.6250/Del./2013

the same. In the absence of books of accounts the transactions of unsecured loans and share application moneys received by the appellant from the cash creditors! share applicants are not verifiable."

In this view of the matter, we admit the additional evidences.

Accordingly, we set aside the orders of the authorities below and restore

the matter back to the file of the Assessing Officer to decide afresh after

providing an opportunity of being heard to the assessee. It is ordered

accordingly.

8. In the result, the appeal of the assessee is allowed for statistical

purposes.

Order pronounced in open court on this 17th day of June, 2015.

Sd/- sd/- (S.V. MEHROTRA) (GEORGE GEORGE K) ACCOUNTANT MEMBER JUDICIAL MEMBER

Dated the 17th day of June, 2015 TS

Copy forwarded to: 1.Appellant 2.Respondent 3.CIT 4.CIT(A)-XVI, New Delhi 5.CIT(ITAT), New Delhi. AR, ITAT NEW DELHI.