Income Tax Appellate Tribunal - Gauhati
Shri Dinesh Shankar Pegu, Guwahati vs Assistant Commissioner Of Income Tax, ... on 12 July, 2019
आयकर अपील य अधीकरण, खंङपीठ गुवाहाट , IN THE INCOME TAX APPELLATE TRIBUNAL GUWAHATI BENCH, GUWAHATI Before Shri S.S.Godara, Judicial Member and Dr. A.L. Saini, Accountant Member ITA No.23/Gau/2014 Block period from:1991-92 to 2001-02 Mrs Bichitra Pegu V/s. ACIT, Circle-1, Shri Dinesh Shankar Pegu Aayakar Bhawan, 6 t h Shri Jyoti Prakash Pegu Floor, Christian Basti, L/h Late Ananda Chandra G.S. Road, Guwahati-
Pegu, House No.5, Ananda 781005
Nagar, Six Mile P.O. P.O.
Khanapara, Guwahati-
781022
[P AN No. ADKPP 0426 C]
अपीलाथ /Appellant .. यथ /Respondent
ITA No.24/Gau/2014
Block period from:1991-92 to 2001-02
Shri Dinesh Shankar Pegu V/s. ACIT, Circle-1,
House No.5, Ananda Aayakar Bhawan, 6 t h
Nagar, Six Mile P.O. P.O. Floor, Christian Basti,
Khanapara, Guwahati- G.S. Road, Guwahati-
781022 781005
[P AN No. AJLPP 9429 J]
अपीलाथ /Appellant .. यथ /Respondent
आवेदक क ओर से/By Assessee Shri Uttam Kr. Borthakur, Advocate
राज व क ओर से/By Revenue Shri M. Haokip, JCIT-DR
सन
ु वाई क तार ख/Date of Hearing 04-07-2019
घोषणा क तार ख/Date of Pronouncement 12-07-2019
आदे श /O R D E R
ITA No.23 & 24/Gau/2014 B.P. 1991-92 to 2001-02
M.r Bichitra Pegu & D.S. Pegu Vs. ACIT, Cir-1 Gau Page 2
PER BENCH:-
These two appeal(s) pertain to as many assessee(s) namely Mrs. Bichitra Pegu and Dinesh Shankar Pegu for relevant block assessment 1991- 92 to 2001-02, arising from the Commissioner of Income Tax (Appeals)- Guwahati's separate order both dated 09.10.2013, passed in case Nos. Guwa-162 & 164/2002-03; respectively involving proceedings u/s 158BC(c) r.w.s.143(3) of the Income Tax Act, 1961; in short 'the Act'.
Heard Shri Uttam Kr. Borthakur advocate appearing for the assessees and Mr. M. Haokip JCIT-DR representing the department.
2. It transpires at the outset during the course of hearing that the instant lis has emanated from the search in question dated 20.07.2000 carried out in case of Late Shri Anand Chand Pegu (predecessor in interest of these two taxpayers). Learned counsel invites our attention to this tribunal's interlocutory order dated 20.04.2017 adjourning both these two cases sine die to await decision of hon'ble apex court in CIT vs. R. Ramaiya Civil Appeal No.2734 of 2013 filed by the Revenue challenging correctness of the concerned hon'ble high court's order holding that this tribiunal could very well adjudicate upon the issue of validity of initiation of a search. There is no dispute that the Revenue's said lis stands declined since involving lower than the prescribed tax effect vide order dated 17.09.2018. We are therefore taking up these two appeal(s) in view of all these intervening judicial developments.
3. Learned counsel invites our attention to the corresponding first identical legal ground that the department had not initiated the search in issue within the provisions of law and therefore, these two corresponding assessment(s) as well as the proceedings are not sustainable. We notice in this backdrop that CIT(A) has rejected the assessee's instant legal plea as under:-
"C. For the sake of convenience, grounds 1 and 2 of appeal are taken up together. In these grounds the appellant has contended that assumption of jurisdiction u/s 132 of IT Act was illegal and without authority of law; and the resultant assessment order u/s. 158BC(c)/143(3) of IT Act was bad in law and liable to be annulled/quashed. It is ITA No.23 & 24/Gau/2014 B.P. 1991-92 to 2001-02 M.r Bichitra Pegu & D.S. Pegu Vs. ACIT, Cir-1 Gau Page 3 settled position of law that "reason to believe" for authorizing search and seizure u/s. 132 of It Act need not be disclosed when a mere allegation is made by td he petitioner. Further, illegality of search does not initiated evidence collected during search. Further evidence collected during an illegal search can also be used against the searched party. In this connection, the case laws reported at Dr. Ratap Singh & Another Vs Director of Enforcement & Ors. 155 ITR 166 (SC); Genom Biotech (P)) Ltd & Ors. Vs DIT(Inv.) & Ors. 23 DTR 241 (Bom)/ 224 CTR 270; Pooram Mal Vs Director of Inspection (Investigation) & Ors. 93 ITR 505 (SC); State of Punjab Vs Baldev Singh etc. 157 CTR 34 (SC). Further, in the case of ITO Vs Seth Bros. 74 ITR 836 (SC), it was held that warrant of authorization need not specify the particulars of books of account and documents to be unearthed in search. Furthermore, it was held in CIT Vs Para Rice Mills 313 ITR 182 (P&H), that Tribunal cannot go into validity or otherwise of administrative decision for conducting search and seizure when hearing an appeal against the order of assessment. Moreover, perusal of sections 246A/246 of IT Act shows that authorizing search and seizure u/s. 132 of IT Act is not appealable and therefore the grounds 1 and 2 of appeal are not maintainable. In any case nothing has been brought on record to substantiate the allegation that assumption of jurisdiction u/s. 132 was illegal and without authority of law. There is no credible evidence or material before me to hold the view that search conducted u/s 132 of the Act was illegal or without authority of law. Moreover, the Assessing Officer has also confirmed vide F.No.ADKPP0426C/BP /ACOT/C-I/GHY/486 dated 10/09/2010 that search was conducted as per the provisions of the Income Tax Act, 1961. In view of the foregoing discussion, I find no merit in grounds 1 and 2 of appeal. Accordingly, ground 1 and 2 of appeal are dismissed."
Mr. Borthakur vehemently contends that since various hon'ble high court(s) have taken divergent view and there is no adjudication coming from hon'ble jurisdictional high court, we ought to adopt the view favouring the taxpayer going by the hon'ble apex court's decision in CIT vs. Vegetable Products Ltd. (1973) 88 ITR 192 (SC). We find no merit in assessee's instant legal arguments. We make it clear first of all that the assessee's corresponding legal ground before the CIT(A) as well as raised before us in tribunal nowhere specifies the manner in which the "search" action does not confirm to provisions of the law at the time of initiation. This clinching factual aspect has gone unrebujtted from the taxpayers' side. The fact also remains that since the impugned instant issue of validity of search before the tribunal has involved divergent legal opinion from various hon'ble high court(s) other than the hon'ble jurisdictional high court; we conclude we can very well take our call on the issue. It has come on record that hon'ble Chattisgarh high court's decision declining the very legal ground in Revenue's favour stands upheld in Special Leave Petition filed/rejected in hon'ble apex court (supra) whereas the ITA No.23 & 24/Gau/2014 B.P. 1991-92 to 2001-02 M.r Bichitra Pegu & D.S. Pegu Vs. ACIT, Cir-1 Gau Page 4 Revenue's appeal has been declined for involving low tax effect. We therefore conclude in these peculiar facts that assessee's former legal plea does not warrant accept once for lack of proper pleadings as well as in view of the forgoing settled legal position. These two assessees fail in their respective corresponding for substantive ground therefore.
4. Coming to merits of the issues raised in both these appeal challenging correctness of the lower authorities' action making various addition(s) mainly those of investments in bank accounts, credit co-operative societies and other head(s). learned counsel's only argument is that the CIT(A)'s order is totally non-speaking wherein he has not considered the evidence filed on record. We find no merit in these latter arguments as well in principle. These two assessees appear to have explained source of their respective investments amounts as received from the former assessee's wife and latter mother Smt. Bichitra Pegu (former appellant) and their claim is that Smt. Pegu was an expert weaver having earned to unexplained income of Rs.14,35,062/-. These two taxpayer's claim credit of the said amounts in their hands. We find no substance in the instant arguments as well since there is not even Smt. Pegu's cash flow statement placed on record suggesting utilization of said income in assessees' investments. We make it clear that all these investments and deposits have been made in the hands of searched assessee-Anand Chandra Pegu and Dinesh Shankar Pegu only. We thus conclude that the lower authorities have rightly assessed all these investments in these two assessees' hands representing on their unexplained income.
5. Lastly comes the issue of correct computation of the impugned investments and deposits. Learned Departmental Representative fails to dispute the crucial facts that neither the Assessing Officer nor the CIT(A) have considered the assessees' cash withdrawals in earlier assessment years as well as from their respective bank accounts for the purpose of peak credit. The fact also remains that the assessees have not filed such details right from ITA No.23 & 24/Gau/2014 B.P. 1991-92 to 2001-02 M.r Bichitra Pegu & D.S. Pegu Vs. ACIT, Cir-1 Gau Page 5 assessment till date for the purpose of seeking credit of their respective earlier cash withdrawals. Faced with this peculiar situation, we deem it appropriate that larger interest of justice would be at this stage in case the former assessee is assessed for a lump sum amount of Rs.28 lakh out of addition than that added in the lower proceedings to the tune of Rs.31,53,807/- and latter taxpayer for similar sum for Rs.12 lac than Rs.8,97,243/- and Rs.6,40,044/-. We make it clear that we have arrived at the foregoing estimation in peculiar facts only. These two assessees get part relief according. Necessary telescoping final computation to be finalized by the Assessing Officer as per law.
6. These two assessees appeals are partly allowed in above terms.
Order pronounced in the open court 12/07/2019
Sd/- Sd/-
(लेखा सद य) (&या'यक सद य)
( A.L.Saini) (S.S.Godara)
(Accountant Member) (Judicial Member)
Guwahati,
*Dkp
(दनांकः- 12/07/2019 ू ाहाठ ।
गव
आदे श क त ल प अ े षत / Copy of Order Forwarded to:-
1. आवेदक/Assessee-Mrs Bichitra Pegu/Dinesh Sharma Pegu, House No.5, Anandanagar Six Mile, P.O. Khanapara, Guwahati-781022
2. राज व/Revenue-ACIT, Cir-1, AAyakar Bhawan, 6th Fl, Christian Basti, G.S. Road, Guwahati-781005
3. संब3ं धत आयकर आय4 ु त गवृ ाहाठ9 / Concerned CIT Guwahati
4. आयकर आय4 ु त- अपील / CIT (A) Guwahati
5. <वभागीय 'त'न3ध, आयकर अपील य अ3धकरण, गव ू ाहाठ9 खंङपीठ / DR, ITAT, Guwahati
6. गाडB फाइल / Guard file.
By order/आदे श से, /True Copy/ Sr. Private Secretary (on tour) आयकर अपील य अ3धकरण, ू ाहाठ ।
गव