VINOD AGGARWAL, MUMBAI V. ITO 15(1)(2), MUMBAI

CO 234/MUM/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 0333 (ITAT-MUMBAI)
• Duration Of Justice: 1 month(s) 18 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 19-09-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2007-2008
• Appeal Filed On: 31-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Reopening of assessment; Search and seizure; Validity of assessment
• Section: 143(3); 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES F, MUMBAI BEFORE SHRI SAKTIJIT DEY, JUDICIAL MEMBER & SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER ITA NO.2573/MUM/2017 ASSESSMENT YEAR : 2007-08 ITO 15(1)(2) MUMBAI VS. VINOD AGGARWAL, 2801, GLENDALE, CLIFF AVENUE, HIRANANDANI GARDEN, POWAI, MUMBAI 400 076 PAN AABPA2240H (APPELLANT) (RESPONDENT) CO 234/M/2018 (ARISING OUT OF ITA NO.2573/MUM/2017 ASSESSMENT YEA R : 2007-08) VINOD AGGARWAL, MUMBAI 400 076. PAN AABPA2240H VS . ITO 15(1)(2) MUMBAI (CROSS-OBJECTOR) (RESPONDENT) APPELLANT BY : SHRI RAJEEV GUBGOTRA CROSS-OBJECTOR BY : MS. SNEHAL SHAL & MS. HIRAL SAM PAT DATE OF HEARING : 0 7 .0 8 .201 8 DATE OF PRONOUNCEMENT : 19 .0 9 .201 8 O R D E R PER SAKTIJIT DEY, JUDICIAL MEMBER THE AFORESAID APPEAL BY THE DEPARTMENT AND CROSS OB JECTION BY THE ASSESSEE ARE DIRECTED AGAINST A COMMON ORDER, DATED 31.01.2017, OF LEARNED CIT(A)-24, MUMBAI, FOR THE ASSESSMENT YEAR 2007-08. ITA NO.2573/MUM/2017 & CO 234/MUM/2018 VINOD AGGARWAL 2 2. ITA NO.2573/MUM/2017 THE ONLY EFFECTIVE GROUND RAISED BY THE DEPARTMENT IS AGAINST THE DELETION OF ADDITION MADE OF ` 79,26,400/- ON ACCOUNT OF ON MONEY PAID IN CASH BY THE ASSESSEE. WHEREAS, IN THE CROSS-OBJECT ION THE ASSESSEE HAS CHALLENGED THE VALIDITY OF PROCEEDINGS U/S. 147 OF THE ACT.. 3. BRIEFLY, FACTS ARE ASSESSEE IS AN INDIVIDUAL. F OR THE ASSESSMENT YEAR UNDER DISPUTE, HE HAS FILED HIS RETURN OF INCOME ON 31.07.2007, DECLARING TOTAL INCOME OF ` 8,85,470/-. THE RETURN OF INCOME FILED BY THE ASS ESSEE WAS PROCESSED U/S. 143(1) OF THE ACT. SUBSEQUENTLY, ON THE BASIS OF INFORMATION RECEIVED FROM THE INVESTIGATION WING OF THE DEPARTM ENT THAT THE ASSESSEE HAS PAID ON MONEY AMOUNTING TO ` 79,26,400/- TO M/S. CRESCENDO ASSOCIATES, A CONCERN OF HIRANANDANI GROUP, TOWARDS PURCHASE OF FLAT, THE ASSESSING OFFICER RE-OPENED THE ASSESSMENT U/S. 147 OF THE AC T AND ISSUED NOTICE U/S. 148 OF THE ACT ON 30.03.2014 TO THE ASSESSEE. IN R ESPONSE TO THE NOTICE ISSUED U/S. 148 OF THE ACT, ASSESSEE VIDE LETTER DA TED 10.04.2014 REQUESTED THE ASSESSING OFFICER TO TREAT THE RETURN FILED ORI GINALLY AS THE RETURN IN RESPONSE TO THE SAID NOTICE. FURTHER, THE ASSESSEE ALSO REQUESTED THE ASSESSING OFFICER TO FURNISH THE REASONS FOR RE-OPE NING THE ASSESSMENT. BE THAT AS IT MAY, IN THE COURSE OF ASSESSMENT PROCEED INGS, THE ASSESSING OFFICER ON THE BASIS OF THE INFORMATION AVAILABLE WITH HIM CALLED UPON THE ASSESSEE TO EXPLAIN THE SOURCE OF PAYMENT OF ON MONEY IN CASH A MOUNTING TO ` ITA NO.2573/MUM/2017 & CO 234/MUM/2018 VINOD AGGARWAL 3 79,26,400/-. THE AR OF THE ASSESSEE APPEARED FROM TIME TO TIME BEFORE THE ASSESSING OFFICER AND FURNISHED THE DETAILS. FURTH ER, THE ASSESSEE WAS ASKED TO FURNISH THE DOCUMENTS/MATERIAL AVAILABLE REGARDI NG THE PAYMENT OF ON MONEY FOR PURCHASE OF PROPERTY FROM HIRANANDANI GRO UP, WHICH WAS ALLEGEDLY NOT RESPONDED TO. THEREFORE, THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE DID NOT FURNISH COGENT EVIDENCE TO PROVE T HE FACT THAT IT HAS NOT PAID ANY ON MONEY FOR PURCHASE OF FLAT. THE ASSESSING O FFICER OBSERVED, DURING A SEARCH AND SEIZURE OPERATION CONDUCTED IN THE MONTH OF MARCH 2014, IN THE CASE OF HIRANANDANI GROUP OF BUILDERS AND DEVELOPER S, CERTAIN EVIDENCE RELATING TO PAYMENT OF ON MONEY IN CASH WAS FOUND. HE OBSERVED, WHEN SUCH EVIDENCES WERE CONFRONTED TO DIRECTORS AND PRO MOTERS OF HIRANANDANI GROUP, THEY ACCEPTED THAT ON MONEY WAS RECEIVED IN CASH ON ACCOUNT OF SALE OF VARIOUS FLATS, WHICH HAS NOT BEEN REFLECTED IN T HE REGULAR BOOKS OF ACCOUNT. THE ASSESSING OFFICER OBSERVED, THE RECEIPT OF SUCH ON MONEY WAS ALSO DECLARED AS ADDITIONAL INCOME BY HIRANANDANI GROUP. THUS, ON THE BASIS OF STATEMENT RECORDED FROM THE DIRECTORS AND PROMOTERS OF HIRANANDANI GROUP, THE ASSESSING OFFICER CONCLUDED THAT ASSESSEE HAS P AID ON MONEY OF ` 79,26,400/- TOWARDS PURCHASE OF FLAT AND ADDED BAC K THE AMOUNT TO THE INCOME OF THE ASSESSEE. BEING AGGRIEVED OF SUCH AD DITION, ASSESSEE PREFERRED APPEAL BEFORE THE CIT(A) CHALLENGING THE ASSESSMENT ORDER PASSED BOTH ON THE LEGAL GROUND OF VALIDITY OF PROCEEDINGS INITIATED U/S. 147(1) OF THE ITA NO.2573/MUM/2017 & CO 234/MUM/2018 VINOD AGGARWAL 4 ACT AS WELL AS ON MERIT OF THE ADDITION MADE ON ACC OUNT OF ON MONEY PAYMENT. 4. AS REGARDS THE LEGAL GROUND RAISED BY THE ASSESS EE, CHALLENGING THE VALIDITY OF PROCEEDINGS U/S. 147 OF THE ACT, LEARNE D CIT(A) REJECTED VARIOUS CONTENTIONS OF THE ASSESSEE AND UPHELD THE RE-OPENI NG OF ASSESSMENT U/S. 147 OF THE ACT TO BE VALID. WITH REGARD TO THE MER IT OF THE ADDITIONS, THE LEARNED CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE IN THE LIGHT OF FACTS AND MATERIAL ON RECORD CONCLUDED THAT THOU GH THE ASSESSING OFFICER RELIED HEAVILY UPON THE STATEMENT GIVEN BY THE THIR D PARTY FOR MAKING THE ADDITION, HOWEVER, THE ASSESSEE WAS NOT GIVEN ANY O PPORTUNITY TO CROSS- EXAMINE SUCH PARTY, WHOSE STATEMENTS WERE RELIED AG AINST THE ASSESSEE. FURTHER, THE LEARNED CIT(A) OBSERVED THAT EXCEPT RE LYING UPON THE INFORMATION OBTAINED FROM THE INVESTIGATION WING, T HE ASSESSING OFFICER HAS NOT MADE ANY INDEPENDENT ENQUIRY OR BROUGHT ON RECO RD ANY MATERIAL TO PROVE THE ACTUAL ON MONEY PAYMENT IN CASH BY THE AS SESSEE. THE LEARNED CIT(A) NOTED THAT THE ENTIRE PAYMENT OF ` 1,75,45,800/- TOWARDS PURCHASE OF FLAT WAS MADE THROUGH BANKING CHANNELS. HOWEVER, T HE FLAT COULD NOT BE REGISTERED IN ASSESSEES NAME BEFORE F Y 2007-08 BE CAUSE OF THE ORDER OF THE HONBLE BOMBAY HIGH COURT. THUS, HAVING FOUND THAT THE ADDITION MADE ON ACCOUNT OF ON MONEY WAS WITHOUT ANY COGENT MATERIAL /EVIDENCE, THE CIT(A) DELETED THE ADDITION. ITA NO.2573/MUM/2017 & CO 234/MUM/2018 VINOD AGGARWAL 5 5. THE LEARNED DR RELIED UPON THE OBSERVATIONS OF T HE ASSESSING OFFICER AND SUBMITTED THAT DURING THE ASSESSMENT PROCEEDING S, THE ASSESSEE HAS NOT FURNISHED ALL THE DETAILS CALLED FOR BY THE ASSESSI NG OFFICER, THUS, THE ASSESSEE COULD NOT PROVE THE FACT THAT ON MONEY WAS NOT PAID FOR THE PURCHASE OF FLAT. THE LEARNED DR SUBMITTED, WHEN THE ASSESSING OFFICE R WAS IN POSSESSION OF EVIDENCE FOUND DURING THE SEARCH AND SEIZURE OPERAT ION INDICATING PAYMENT OF ON MONEY, IT WAS THE DUTY OF THE ASSESSEE TO COME C LEAN ON THE ISSUE. THUS, HE SUBMITTED, THE ADDITION MADE BY THE ASSESSING OF FICER SHOULD BE RESTORED. 6. THE LEARNED AR CHALLENGING THE VALIDITY OF RE-OP ENING OF ASSESSMENT U/S. 147 OF THE ACT SUBMITTED, WHILE ISSUING NOTICE U/S. 148 OF THE ACT, THE ASSESSING OFFICER HAS NOT OBTAINED THE SANCTION OF THE PRESCRIBED AUTHORITY AS PER SECTION 151(2) OF THE ACT. DRAWING OUR ATTENTI ON TO THE COPY OF NOTICE DATED 30.03.2014, ISSUED U/S. 148 OF THE ACT, WHICH IS PLACED AT PAGE 7 OF THE PAPER-BOOK, HE SUBMITTED THAT THE NOTICE CLEARLY ST ATES THAT IT WAS ISSUED AFTER OBTAINING SANCTION OF THE CIT AND NOT THE JOI NT CIT AS REQUIRED U/S. 151(2) OF THE ACT. THUS, THE ASSESSING OFFICER HAV ING NOT TAKEN SANCTION FROM THE APPROPRIATE AUTHORITY BEFORE ISSUING NOTIC E U/S. 148 OF THE ACT, THE PROCEEDINGS U/S. 147 OF THE ACT IS INVALID. FURTHE R, REFERRING TO THE LETTER DATED 20.03.2015, FILED BEFORE THE ASSESSING OFFICE R, THE LEARNED AR SUBMITTED, THOUGH THE ASSESSEE RAISED OBJECTIONS AG AINST THE PROCEEDINGS INITIATED U/S. 147 OF THE ACT, HOWEVER, THE ASSESSI NG OFFICER HAS NOT DISPOSED ITA NO.2573/MUM/2017 & CO 234/MUM/2018 VINOD AGGARWAL 6 OF THE OBJECTIONS OF THE ASSESSEE BEFORE COMPLETING THE ASSESSMENT AND FOR THAT REASON ALSO THE ASSESSMENT IS INVALID. THE LE ARNED AR SUBMITTED, EVEN OTHERWISE ALSO THE ADDITION MADE BY THE ASSESSING O FFICER ON ACCOUNT OF ON MONEY WAS NOT SUSTAINABLE AS THE SAID ADDITION MADE WAS PURELY ON SUSPICION AND SURMISES WITHOUT ANY COGENT EVIDENCE TO DEMONST RATE THAT THE ASSESSEE HAS PAID ON MONEY IN CASH. THE LEARNED AR SUBMITT ED, IN COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE HAD SPECIFICALL Y REQUESTED THE ASSESSING OFFICER TO COMMUNICATE THE ADVERSE MATERI AL AVAILABLE WITH HIM FOR A PROPER AND EFFECTIVE REBUTTAL. HOWEVER, THE ASSE SSING OFFICER REFUSED TO DISCLOSE ANY SUCH MATERIAL TO THE ASSESSEE. HE FUR THER SUBMITTED, EVEN THE ASSESSEE WAS NOT GIVEN AN OPPORTUNITY TO CROSS EXAM INE THE PERSONS WHOSE STATEMENTS WERE RELIED BY THE ASSESSING OFFICER FOR MAKING THE ADDITION. THE LEARNED AR SUBMITTED, THE ASSESSMENT ORDER REVEALS THAT ONLY RELYING UPON CERTAIN INFORMATION RECEIVED FROM THE INVESTIGATION WING AND STATEMENTS OF THIRD PARTIES, THE ASSESSING OFFICER HAS MADE ADDIT IONS WITHOUT ANY INDEPENDENT ENQUIRY. WHEREAS, THE ASSESSEE HAS PRO VED ITS BONA FIDE BY FURNISHING ALL NECESSARY AND RELEVANT DETAILS RELAT ING TO PURCHASE OF FLAT, PAYMENT OF WHICH WERE MADE THROUGH BANKING CHANNELS . THUS, HE SUBMITTED, THE ADDITION MADE PURELY ON CONJECTURE A ND SURMISES WERE RIGHTLY DELETED BY THE CIT(A). FINALLY, THE LEARNED AR SUB MITTED, IDENTICAL ISSUE ARISING IN THE CASE OF ASSESSEES SON , SHRI NIKHIL VINOD AGGARWAL, WAS DECIDED IN FAVOUR OF THE ASSESSEE BY THE TRIBUNAL. THE LEA RNED AR SUBMITTED, FACTS OF ITA NO.2573/MUM/2017 & CO 234/MUM/2018 VINOD AGGARWAL 7 BOTH THE CASES BEING IDENTICAL, THE DECISION OF THE TRIBUNAL IN CASE OF NIKHIL VINOD AGGARWAL IN ITA NO.2574/MUM/2017 DATED 13.10. 2017 SHOULD BE FOLLOWED. 7. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSED MATERIAL AVAILABLE ON RECORD. AT THE OUTSET, WE PROPOSE TO ADDRESS TH E LEGAL ISSUE RAISED BY THE ASSESSEE IN THE CROSS OBJECTION, CONCERNING THE VAL IDITY OF ASSESSMENT ORDER PASSED U/S. 143(3) READ WITH SECTION 147 OF THE ACT . THE FIRST CONTENTION OF THE ASSESSEE CHALLENGING THE VALIDITY OF ASSESSMENT ORDER IS, BEFORE ISSUING NOTICE U/S. 148 OF THE ACT, THE ASSESSING OFFICER H AS NOT OBTAINED SANCTION OF THE APPROPRIATE AUTHORITY AS PRESCRIBED U/S. 151 OF THE ACT. AS COULD BE SEEN FROM THE FACTS ON RECORD, IN THE CASE OF THE PRESEN T ASSESSEE, PRIOR TO THE REOPENING OF ASSESSMENT U/S. 147 OF THE ACT, THERE WAS NO ASSESSMENT COMPLETED U/S. 143(3) OF THE ACT. THEREFORE, THE PROVISIONS OF SECTION 151(2) OF THE ACT, AS IT EXISTED DURING THE RELEVAN T ASSESSMENT YEAR WOULD APPLY. AS PER THE SAID PROVISION, IN A CASE WHERE FOUR YEARS HAVE EXPIRED FROM THE END OF THE RELEVANT ASSESSMENT YEAR, NO NO TICE U/S. 148 OF THE ACT CAN BE ISSUED BY THE ASSESSING OFFICER WITHOUT OBTA INING THE SANCTION OF THE JOINT COMMISSIONER OF INCOME TAX (JCIT). THUS, AS PER THE STATUTORY MANDATE CONTAINED U/S. 151(2) OF THE ACT, THE APPRO PRIATE AUTHORITY FROM WHOM THE ASSESSING OFFICER SHOULD HAVE OBTAINED SAN CTION/APPROVAL BEFORE ISSUING NOTICE U/S. 148 OF THE ACT IS THE JCIT AND NOT THE CIT. THEREFORE, THE ITA NO.2573/MUM/2017 & CO 234/MUM/2018 VINOD AGGARWAL 8 NOTICE ISSUED U/S. 148 OF THE ACT, IN THE PRESENT C ASE, DOES NOT SATISFY THE CONDITION OF SECTION 151(2) OF THE ACT AS THE DEPAR TMENT HAS FAILED TO BRING ANY MATERIAL BEFORE THE BENCH TO DEMONSTRATE THAT S ANCTION/APPROVAL FOR ISSUANCE OF NOTICE U/S 148 OF THE ACT WAS OBTAINED FROM THE JCIT. THAT BEING THE CASE, THE MANDATORY REQUIREMENT OF SECTION 151( 2) OF THE ACT HAVING NOT BEING FULFILLED, THE ASSESSMENT ORDER PASSED U/S. 1 43 READ WITH SECTION 147 OF THE ACT IS INVALID. IN THIS CONTEXT, WE MAY REFER TO THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. SOYUZ INDUS TRIAL RESOURCES LTD. (2015) 232 TAXMAN 414. IT IS RELEVANT TO OBSERVE, UNDER IDENTICAL FACTS AND CIRCUMSTANCES, WHILE DECIDING THE CASE OF SHRI NIKH IL VINOD AGGARWAL (SUPRA), THE TRIBUNAL HAS HELD AS UNDER: 10. FROM THE NOTICE ISSUED UNDER SECTION 148, IT I S EVIDENT THAT THE ASSESSING OFFICER HAS OBTAINED SANCTION OF THE CIT AND NOT THE JOINT CIT. WHEN THIS FACT WAS POINTED OUT TO THE LEARNED DEPAR TMENTAL REPRESENTATIVE AND A SPECIFIC QUERY WAS RAISED BY T HE BENCH, THE LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE APPR OVAL OF JOINT CIT IS NOT AVAILABLE ON RECORD AND HE FURTHER SUBMITTED TH AT IF SUCH APPROVAL IS AVAILABLE IT WILL BE FURNISHED BEFORE THE BENCH. HO WEVER, TILL DATE NO SUCH APPROVAL OF JOINT CIT HAS BEEN BROUGHT ON RECORD BY THE LEARNED DEPARTMENTAL REPRESENTATIVE. THUS, IT HAS TO BE PRE SUMED THAT NO SUCH APPROVAL OF JOINT CIT HAS BEEN OBTAINED BY THE ASSE SSING OFFICER IN TERMS OF SECTION 151(2) OF THE ACT BEFORE ISSUANCE OF NOT ICE UNDER SECTION 148 OF THE ACT. WHEN THE PROVISIONS CONTAINED UNDER THE STATUTE MANDATE A PARTICULAR ACT TO BE DONE IN A PARTICULAR MANNER, I T HAS TO BE DONE IN THAT MANNER ONLY. THE ASSESSING OFFICER BEING BOUND BY S TATUTORY PROVISIONS HAS TO STRICTLY COMPLY WITH AND ACT IN ACCORDANCE W ITH THE RELEVANT STATUTORY PROVISIONS. THE ARGUMENT OF THE DEPARTMEN T THAT ABSENCE OF APPROVAL FROM JOINT CIT WOULD NOT INVALIDATE THE AS SESSMENT PROCEEDINGS, SINCE, THE APPROVAL HAS BEEN OBTAINED FROM A HIGHER AUTHORITY IS TOO SPECIOUS AN ARGUMENT TO BE SHRI NI KHIL VINOD AGGARWAL ACCEPTED. OBTAINING OF SANCTION FROM A HIGHER AUTHO RITY DOES NOT SATISFY THE STATUTORY MANDATE. THAT BEING THE CASE, WE HOLD THAT IN ABSENCE OF SANCTION / APPROVAL FROM THE AUTHORITY PRESCRIBED U NDER SECTION 151(2) OF ITA NO.2573/MUM/2017 & CO 234/MUM/2018 VINOD AGGARWAL 9 THE ACT, ISSUE OF NOTICE UNDER SECTION 148 IS INVAL ID. CONSEQUENTLY, THE ASSESSMENT ORDER PASSED IN PURSUANCE THERETO IS ALS O INVALID. IN SUPPORT OF OUR AFORESAID CONCLUSION, WE MAY REFER TO THE DE CISION OF THE HON'BLE DELHI HIGH COURT IN CASE OF CIT V/S SOYUZ INDUSTRIA L RESOURCES LTD., [2015] 232 TAXMAN414. MOREOVER, IT IS RELEVANT TO OBSERVE, IN COURSE OF A SSESSMENT PROCEEDINGS, THE ASSESSEE HAS SPECIFICALLY OBJECTED TO THE VALIDITY OF THE PROCEEDINGS INITIATED U/S. 147 OF THE ACT. HOWEVER, BEFORE COMPLETION OF ASSESSMENT, THE ASSESSING OFFICER HAS NOT DISPOSED OF THE OBJECTION S OF THE ASSESSEE. FOR THAT REASON ALSO THE ASSESSMENT ORDER PASSED U/S. 143(3) READ WITH SECTION 147 OF THE ACT HAS TO BE DECLARED AS INVALID, HENCE, DESER VES TO BE QUASHED. 8. HAVING HELD SO, WE PROPOSE TO DEAL THE ISSUE ON MERIT ALSO AS, IN OUR VIEW, THE ASSESSEE HAS A STRONG CASE ON MERIT. IT IS EVIDENT FROM THE ASSESSMENT ORDER, THE ASSESSING OFFICER HAS PRIMARI LY RELIED UPON CERTAIN INFORMATION RECEIVED FROM THE INVESTIGATION WING, W HICH CONTAINED STATEMENT RECORDED FROM THE DIRECTORS/PROMOTERS OF HIRANANDAN I GROUP ADMITTING RECEIPT OF ON MONEY. IT IS ALSO EVIDENT FROM THE A SSESSMENT ORDER ITSELF, IN RESPONSE TO THE QUERY RAISED BY THE ASSESSING OFFIC ER, THE ASSESSEE HAS APPEARED FROM TIME TO TIME AND, AS PER ASSESSING OF FICERS OWN VERSION, FILED SOME DETAILS. HOWEVER, ALLEGING THAT THE ASSESSEE DID NOT FURNISH NAME OF THE PERSON (BROKER), WHO FIXED THE FINAL RATE AND C ONDITIONS OF PAYMENT, THE ASSESSING OFFICER REJECTED ASSESSEES CLAIM OF NON- PAYMENT OF ON MONEY. IN THIS REGARD, IT IS THE SPECIFIC CONTENTION OF THE A SSESSEE THAT NO BROKER WAS ITA NO.2573/MUM/2017 & CO 234/MUM/2018 VINOD AGGARWAL 10 INVOLVED IN THE TRANSACTION RELATING TO PURCHASE OF FLAT. MOREOVER, IT IS EVIDENT, IN COURSE OF ASSESSMENT PROCEEDINGS THE AS SESSEE HAS REPEATEDLY REQUESTED THE ASSESSING OFFICER TO COMMUNICATE AND BRING TO HIS NOTICE THE ADVERSE MATERIALS IN HIS POSSESSION FOR EFFECTIVE R EBUTTAL. HOWEVER, THE ASSESSING OFFICER HAS REFUSED TO DIVULGE ANY INFORM ATION AVAILABLE WITH HIM WHICH WERE ULTIMATELY UTILIZED AGAINST THE ASSESSEE . EVEN THOUGH THE STATEMENTS OF THIRD PARTIES WERE UTILIZED FOR MAKIN G THE ADDITION, NO OPPORTUNITY FOR CROSS-EXAMINATION WAS OFFERED TO TH E ASSESSEE. THIS, IN OUR VIEW, IS IN GROSS VIOLATION OF RULES OF NATURAL JUS TICE. IT IS FURTHER RELEVANT TO OBSERVE, THE ASSESSING OFFICER HAS NOT CONDUCTED AN Y ENQUIRY WORTH ITS NAME INDEPENDENTLY TO ASCERTAIN THE FACT WHETHER THE ASS ESSEE HAS ACTUALLY PAID ON MONEY IN CASH OR NOT. NON-FURNISHING OF DETAILS BY THE ASSESSEE AS ALLEGED BY THE ASSESSING OFFICER CERTAINLY CANNOT PREVENT HIM FROM MAKING ANY FURTHER ENQUIRY AND INVESTIGATION TO ASCERTAIN THE TRUTH. SIMPLY RELYING UPON THE STATEMENT OF THIRD PARTIES, THE ASSESSING OFFICER C ANNOT MAKE THE ADDITION PURELY ON CONJECTURES AND SURMISES AND IN THE PROCE SS IGNORE THE EVIDENCE BROUGHT ON RECORD BY THE ASSESSEE BY WAY OF PAYMENT MADE THROUGH BANKING CHANNEL AND THE DOCUMENTARY EVIDENCE THEREOF. IT I S RELEVANT TO OBSERVE, WHILE DECIDING IDENTICAL ISSUE IN THE CASE OF SHRI NIKHIL VINOD AGGARWAL (SUPRA), THE BENCH HAS HELD AS UNDER: ITA NO.2573/MUM/2017 & CO 234/MUM/2018 VINOD AGGARWAL 11 11. EVEN OTHERWISE ALSO, THE ASSESSEE HAS A STRONG CASE ON MERIT AS WELL. AS EVIDENT FROM THE FACTS ON RECORD, THE ASSE SSING OFFICER HAS MADE THE ADDITION ON ACCOUNT OF ALLEGED ON-MONEY PAID BY THE ASSESSEE TOWARDS PURCHASE OF FLAT RELYING UPON THE INFORMATI ON OBTAINED FROM THE SEARCH OPERATION CARRIED OUT IN THE CASE OF HIRANAN DANI GROUP. FURTHER, HE HAS RELIED UPON THE STATEMENTS RECORDED FROM THE DIRECTORS AND PROMOTERS OF HIRANANDANI GROUP IN COURSE OF SEARCH. HOWEVER, THOUGH, THE ASSESSEE IN THE COURSE OF ASSESSMENT PROCEEDING S, HAS REPEATEDLY REQUESTED THE ASSESSING OFFICER TO PROVIDE THE INFO RMATION / ADVERSE MATERIAL IN HIS POSSESSION, NEITHER SUCH ADVERSE MA TERIAL WAS PROVIDED TO THE ASSESSEE NOR CONFRONTED TO HIM. FURTHER, THE ST ATEMENT RECORDED FROM THIRD PARTIES WHICH WERE RELIED UPON BY THE AS SESSING OFFICER FOR MAKING THE ADDITION WERE NEITHER CONFRONTED TO THE ASSESSEE NOR THE ASSESSEE WAS SHRI NIKHIL VINOD AGGARWAL PERMITTED T O CROSS-EXAMINE THE CONCERNED PERSONS. NEITHER IN THE ASSESSMENT ORDER THE ASSESSING OFFICER HAS DISCUSSED IN DETAIL THE NATURE OF INFORMATION / MATERIAL AVAILABLE WITH HIM DIRECTLY IMPLICATING THE ASSESSEE FOR PAYING ON -MONEY FOR PURCHASE OF FLAT NOR THE LEARNED DEPARTMENTAL REPRESENTATIVE HA S BROUGHT ON RECORD ANY SUCH MATERIAL AS MAY BE AVAILABLE WITH THE ASSE SSING OFFICER. IT IS EVIDENT FROM THE ASSESSMENT ORDER,, THE ASSESSING O FFICER WITHOUT DISCLOSING ADVERSE MATERIAL / INFORMATION AVAILABLE WITH HIM TO THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS, HAS SIM PLY CALLED UPON THE ASSESSEE TO FURNISH THE NAME OF PERSONS WHO ACCORDI NG TO THE ASSESSING OFFICER NEGOTIATED FOR PURCHASE OF FLAT BETWEEN THE ASSESSEE AND THE BUILDER. UNLESS, THE ASSESSEE IS CONFRONTED WITH TH E ADVERSE MATERIAL IN POSSESSION OF THE ASSESSING OFFICER, HE CANNOT BE E XPECTED TO REBUT THEM CONSIDERING THE FACT THAT THE FROM VERY BEGINNING T HE ASSESSEE HAS CONSISTENTLY STATED THAT HE HAS NOT PAID ANY ON-MON EY OVER AND ABOVE THE DECLARED SALE CONSIDERATION. THE LEARNED COMMIS SIONER (APPEALS) WHILE DECIDING THE ISSUE HAS CLEARLY BROUGHT OUT TH E AFORESAID FACTUAL ASPECT IN HIS ORDER. WE AGREE WITH THE LEARNED COMM ISSIONER (APPEALS) THAT ONCE THE ASSESSEE HAS FURNISHED THE DETAILS OF TRANSACTIONS RELATING TO PURCHASE OF FLAT AND HAS STATED THAT HE HAS NOT PAID ON-MONEY OVER AND ABOVE THE DECLARED SALE CONSIDERATION, BURDEN S HIFTS TO THE ASSESSING OFFICER TO FALSIFY SHRI NIKHIL VINOD AGGARWAL ASSES SEE'S CLAIM BY BRINGING COGENT EVIDENCE ON RECORD. MERELY, REFERRING TO CER TAIN ADVERSE MATERIAL AND STATEMENT OF THIRD PARTIES, BUT, WITHOUT CONFRO NTING THEM TO THE ASSESSEE THE ASSESSING OFFICER CANNOT MAKE THE ADDI TION. IN VIEW OF THE AFORESAID, WE DO NOT FIND ANY INFIRMITY IN THE ORDE R OF THE LEARNED COMMISSIONER (APPEALS) IN DELETING THE ADDITION. AC CORDINGLY, WE UPHOLD THE ORDER OF THE LEARNED COMMISSIONER (APPEALS) BY DISMISSING THE GROUND RAISED BY THE REVENUE. THE AFORESAID DECISION OF THE CO-ORDINATE BENCH, UN DER IDENTICAL FACTS AND CIRCUMSTANCES, EQUALLY APPLIES TO THE PRESENT APPEA L ALSO. THEREFORE, ON ITA NO.2573/MUM/2017 & CO 234/MUM/2018 VINOD AGGARWAL 12 OVERALL CONSIDERATION OF FACTS AND MATERIAL ON RECO RD, WE ARE OF THE VIEW THAT THE LEARNED CIT(A) WAS JUSTIFIED IN DELETING THE AD DITION MADE BY THE ASSESSING OFFICER. THUS, THE ASSESSEE DESERVES TO SUCCEED ON MERITS AS WELL. 9. IN THE RESULT, THE DEPARTMENTAL APPEAL IS DISMIS SED AND THE CROSS- OBJECTION IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY OF 1 9 TH SEPTEMBER 2018. SD/- SD/- (MANOJ KUMAR AGGARWAL) (SAKTIJIT DEY) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED : 19 TH SEPTEMBER, 2018. SA COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE C I T(A), MUMBAI. 4. THE C I T 5. THE DR, F BENCH, ITAT, MUMBAI BY ORDER, //TRUE COPY// (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, MUMBAI