Income Tax Appellate Tribunal - Delhi
Suresh Chand Garg vs Assistant Commissioner Of Income-Tax on 21 May, 1992
Equivalent citations: [1992]42ITD166(DELHI)
ORDER
R.M. Mehta, Accountant Member
1. Both parties are aggrieved with the consolidated order passed by the CIT (Appeals) for assessment years 1978-79, 1979- 80 and 1980-81.
2. The original assessments for these three years were reopened by resort to the provisions of Section 147(a) consequent to the action under Section 132 of the Act at the business and residential premises of the assessee. In the reassessments certain additions came to be made on account of interest, household expenses and bad debts written off for all the three years and in respect of assessment years 1979-80 and 1980-81 on account of unexplained investments.
3. Being aggrieved with the orders of the ITO, the assessee came up in appeals before the CIT (Appeals) who allowed some relief in respect of bad debts, household expenses and unexplained investments but retaining the remaining additions. In view of the aforesaid, further appeals were preferred to the Tribunal, by both parties.
4. At this stage, we would like to mention that although the assessee did not raise any grievance about the reopening of the cases at the assessment stage and even before the CIT (Appeals), he for the first time raised the following common ground before the Tribunal:--
That the learned CIT (Appeals) has erred both in law and on facts in upholding the validity of reassessment proceedings under Section 147(a)/ 148 of the Act. The learned CIT (Appeals) has failed to appreciate that necessary conditions specified under that section did not stand satisfied in the instant case and the reassessment proceeding was liable to be quashed altogether.
5. The appeals of both the parties were consolidated and these came up for hearing on 20-3-1991 when the assessee's counsel filed a paper book as also an additional ground of appeal. The matters were thereafter adjourned to 1-5-1991 for allowing an opportunity to the Departmental Representative to state his objections, if any. On 1-5-1991 the matter was heard at some length and it was felt that the assessment records were required to be examined by the Tribunal and specific directions were given to the Departmental Representative to produce these on 4-7-1991. On this date the Departmental Representative requested for an adjournment on the plea that the records had not been received. This request was accepted and the matter adjourned to 27-8-1991. Even on this date, the records were not made available and the matter was once again adjourned to 16-10-1991 at the request of the Departmental Representative. The appeals were, thereafter fixed in December 1991, January 1992, March 1992 and again on 7-5-1992.
6. On 7-5-1992, the Departmental Representative was asked whether the records were available but his reply was in the negative. He categorically stated that all his letters to the various tax functionaries had remained unacknowledged and he was, accordingly, not in a position to produce the records.
7. The facts narrated in the preceding paras reveal a sorry state of affairs since the department finds itself unable to produce the assessment records which it was directed to do by the Tribunal from a place which borders Delhi namely Ghaziabad. An Inspector could have easily been deputed to bring these records to Delhi and produce them before the Tribunal which felt the necessity to see the reasons recorded for the reopening of the cases and in respect of which a legal ground had been taken up before the Tribunal and for whose admission no opposition had been raised by the Departmental Representative at any stage. That apart, the casual attitude displayed by the officials to whom the Departmental Representative conveyed the directions of the Tribunal in not even responding to his letters is most deplorable.
8. In view of the aforesaid facts, we have absolutely no hesitation in coming to the conclusion that the reopening was bad in law and which would be amply proved in case the records were to be produced before us. We are fully justified in drawing an adverse inference against the department for not complying with the directions of the Tribunal to produce the records and for which ample opportunities had been allowed for a period of full one year viz. May 1991 to May 1992. In the final analysis we quash the reassessment orders holding the reopening under Section 147(a) to be bad in law. In the view that we have taken, we do not find it necessary to deal with any of the other grounds raised in these appeals including the additional ground.
9. In the result, the assessee's appeals are allowed whereas those of the revenue are dismissed.