Shri Dineshbhai P.Patel, Mehsana V. The ACIT.,Cent.Circle-1(1), Ahmedabad

CO 341/AHD/2010

• Counselvise Citation: [2013] 122 COUNSELVISE.COM (IT) 8181 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 1 month(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 31-01-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 28-01-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 31-12-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SUBHASH BAINA
• Keywords: Document seized; Opportunity of being heard; Documents seized
• Section: 143(3); 153A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH AHMEDABAD (BEFORE SHRI A. K. GARODIA, AM AND SHRI KUL BHARAT, JM) IT(SS)A NO.811 AND 812/AHD/2010 (AY: 2006-07 AND 2007-08) THE A. C. I. T., CENT. CIR-1(1), ROOM NO.303, 3 RD FLOOR, AAYAKAR BHAVAN, ASHRAM ROAD, AHMEDABAD VS SHRI DINESHBHAI P. PATEL, C-49/50, SARDAR PATEL COMPLEX, SARDAR PATEL CHOWK, UNJHA (NORTH GUJARAT) P. A. NO.ACDPP 9695 F (APPELLANT) (RESPONDENT) C. O. NO.340 AND 341/AHD/2010 (IN IT (SS) A NO.811 AND 812/AHD/2010) SHRI DINESHBHAI P. PATEL, C-49/50, SARDAR PATEL COMPLEX, SARDAR PATEL CHOWK, UNJHA (NORTH GUJARAT) P. A. NO. ACDPP 9695 F VS THE A. C. I. T., CENT. CIR-1(1), ROOM NO.303, 3 RD FLOOR, AAYAKAR BHAVAN, ASHRAM ROAD, AHMEDABAD (APPELLANT) (RESPONDENT) DEPARTMENT BY SHRI SUBHASH BAINA, CIT DR ASSESSEE BY NONE DATE OF HEARING: 28-01-2013 DATE OF PRONOUNCEMENT: 31-01-2013 ORDER PER A. K. GARODIA : THESE ARE TWO APPEALS FILED BY THE REVENUE AND TH E CROSS OBJECTIONS ARE FILED BY THE ASSESSEE WHICH AR E DIRECTED AGAINST TWO SEPARATE ORDERS OF THE LEARNED CIT(A)-I, AHMEDABAD BOTH DATED 11-10-2010 FOR IT (SS) A NO. 811 & 812 AND CO NO.340 & 341/AHD/2010 (AY: 2006-07 AND 2007-08) SHRI DINESHBHAI P. PATEL 2 THE ASSESSMENT YEARS 2006-07 AND 2007-08. THESE WER E HEARD TOGETHER AND ARE BEING DISPOSED OFF BY THIS COMMON ORDER FOR THE SAK E OF CONVENIENCE. 2. NONE APPEARED ON BEHALF OF THE ASSESSEE ON THE A PPOINTED DATE OF HEARING ALTHOUGH NOTICE WAS DULY SERVED ON THE ASSE SSEE AS PER ACKNOWLEDGEMENT AVAILABLE ON RECORD AND HENCE, PROC EEDED TO DECIDE THIS APPEALS AND THE CROSS OBJECTIONS EX-PARTE QUA TO TH E ASSESSEE. 3. FIRST, WE TAKE UP THE CROSS OBJECTIONS FILED BY THE ASSESSEE. IN BOTH THE YEARS GROUNDS RAISED BY THE ASSESSEE ARE IDENTICAL AND WE REPRODUCE THE GROUNDS RAISED BY THE ASSESSEE IN THE CROSS OBJECTI ONS FOR THE ASSESSMENT YEAR 2006-07 I.E. C. O. NO.340/AHD/2010 WHICH ARE AS UND ER: 1. LD. CIT(A) HAS ERRED IN LAW IN CONFIRMING THE A CTION OF AO IN UPHOLDING THE ASSESSMENT ORDER PASSED U/S 153A (1) (B) R. W. S. 153C R. W. S. 143(3) OF THE ACT WHICH IS PATENTLY I LLEGAL, WITHOUT JURISDICTION, BAD IN LAW AND GROSSLY AGAINST THE SC HEME OF THE ACT. 2. LD. CIT(A) HAS ERRED IN LAW IN CONFIRMING THE AC TION OF THE AO IN NOT APPRECIATING THAT THE WHOLE OF THE ASSESSMENT ORDER FRAMED U/S 153A (1) (B) R. W. S. 153C R. W. S. 143(3) OF THE A CT IS BAD IN LAW AS THE SAME CAN ONLY BE FRAMED IF DURING THE COURSE OF THE SEARCH AT A THIRD PARTY SOME MATERIAL BELONGING TO THE ASSESS EE IS FOUND. IN THE FACTS OF THE PRESENT CASE, ADMITTEDLY NO SUCH M ATERIAL HAS BEEN FOUND AND THEREFORE THE WHOLE OF THE ASSESSMENT ORD ER IS WITHOUT JURISDICTION. 3. LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN NOT APPRECIATING THAT THE EVEN THE ASSESSMENT U/S 153A R. W. S. 153C OF THE A CT IS RESTRICTED TO THE MATERIALS AND EVIDENCES INDICATING UNDISCLOS ED OR UNRECORDED INCOME FOUND DURING THE COURSE OF THE SE ARCH AND THE SAME CANNOT GO BEYOND THE SAME. IN THE FACTS OF THE PRESENT CASE, NONE OF THE ADDITIONS ARE BASED ON THE SEARCH MATER IAL AND THEREFORE ALSO THE ASSESSMENT ORDER MAY KINDLY BE Q UASHED. 4. LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONF IRMING THE LEVY OF INTEREST UNDER SECTION 234A, 234B, 234C & 234D OF T HE ACT. 5. THE LEARNED CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF THE AO IN INITIATING PENALTY UNDER SECTIO N 271(1) ( C ) OF THE IT (SS) A NO. 811 & 812 AND CO NO.340 & 341/AHD/2010 (AY: 2006-07 AND 2007-08) SHRI DINESHBHAI P. PATEL 3 ACT WITHOUT RECORDING MANDATORY SATISFACTION AS CON TEMPLATED UNDER THE ACT. 4. THE LEARNED DR OF THE REVENUE SUPPORTED THE ORDE RS OF THE AUTHORITIES BELOW ON THIS ISSUE. 5. WE HAVE CONSIDERED THE SUBMISSIONS OF THE LEARNE D DR OF THE REVENUE AND GONE THROUGH THE ORDER OF THE LEARNED CIT(A). T HIS ISSUE HAS BEEN DECIDED BY THE LEARNED CIT(A) IN PARA 4 OF HIS ORDER AND FO R THE SAKE OF READY REFERENCE WE REPRODUCE PARA 4 OF THE ORDER OF THE LEARNED CIT (A) FROM ASSESSMENT YEAR 2006-07 WHICH IS IDENTICAL IN THE ORDER FOR THE ASS ESSMENT YEAR 2007-08. THE SAME READS AS UNDER: 4. I HAVE CAREFULLY GONE THROUGH THE FACTS AS ALSO THE TRIBUNAL DECISIONS REFERRED TO ABOVE. IN MY VIEW, THE APPELL ANT CANNOT SUCCEED ON THIS GROUND RAISED BY IT. THE ONLY REQUIREMENT U/S. 153C IS THAT THE SEIZED BOOKS OF ACCOUNTS, DOCUMENTS OR PAPERS OR ANY UNACC OUNTED ASSETS MUST BE FOUND TO BE BELONGING TO THE ASSESSEE. THE ASSES SING OFFICER HAS SHOWN BEFORE ME THAT ANNEXURE -62, 64 AND 65 WERE F OUND TO BE BELONGING TO THE ASSESSEE. HENCE, THE REQUIREMENT F OR INVOKING SECTION 153C IS FULFILLED. WHEN THE PROCEEDINGS U/S 153A (1 B) RWS 153C ARE INITIATED, THE ASSESSMENT PROCEEDING IN RESPECT OF THE PRECEDING SIX YEARS ABATE AND THE ASSESSING OFFICER HAS TO ISSUE NOTICE S FOR ASSESSMENT S OR REASSESSMENTS. IT IS TRUE THAT THE ASSESSING OFFICE R HAS NOT DRAWN SUPPORT FROM ANY SEIZED DOCUMENTS FOR THE ADDITIONS MADE BY HIM BUT HE HAS REFERRED TO DOCUMENTS SEIZED AS PER ANNEXURE 62, 64 & 65. CONSIDERING THE ENTIRE FACTS AND CIRCUMSTANCES AND THE PROVISIO NS OF LAW, I DO NOT FIND ANY MERIT IN THE GROUND OF APPEAL CHALLENGING THE V ALIDITY OF THE PROCEEDINGS AND, THEREFORE, THIS GROUND OF APPEAL I S REJECTED AND THE LEGALITY OF THE PROCEEDINGS INITIATED UNDER SECTION 153C IS UPHELD. 6. WE FIND THAT THE ORDER OF THE LEARNED CIT(A) IS DATED 11-10-2010, BUT THEREAFTER SPECIAL BENCH OF THE TRIBUNAL IN THE CAS E OF ALL CARGO GLOBAL LOGISTICS IT (SS) A NO. 811 & 812 AND CO NO.340 & 341/AHD/2010 (AY: 2006-07 AND 2007-08) SHRI DINESHBHAI P. PATEL 4 LTD. HAS DECIDED THIS ISSUE WHICH IS REPORTED IN 13 7 ITD 26 (MUM.) (SB). HENCE, WE ARE OF THE CONSIDERED VIEW THAT THIS ISSUE SHOUL D BE DECIDED AFRESH BY THE LEARNED CIT(A) IN THE LIGHT OF THIS DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL AND HENCE, WE SET ASIDE THE ORDER OF THE LEARNED CI T(A) ON THIS ASPECT AND RESTORE THE MATTER BACK TO HIS FILE FOR FRESH DECIS ION IN THE LIGHT OF THE DECISION OF THE SPECIAL BENCH STATED ABOVE. HE SHOULD PASS A SP EAKING ORDER IN THE LIGHT OF THE AFORESAID DECISION AFTER AFFORDING ADEQUATE OPP ORTUNITY OF BEING HEARD TO BOTH THE SIDES. 7. IN THE RESULT, THE CROSS OBJECTIONS OF THE ASSES SEE ARE ALLOWED FOR STATISTICAL PURPOSE. 8. NOW, WE TAKE UP THE APPEALS FILED BY THE REVENUE . 9. IN BOTH THE YEARS, ONLY ONE EFFECTIVE GROUND HAS BEEN RAISED BY THE REVENUE REGARDING DELETION OF THE ADDITION MADE BY THE AO ON ACCOUNT OF SUPPRESSION OF PROFIT BY THE ASSESSEE TO THE EXTENT OF RS.3,85,59,290/- IN THE ASSESSMENT YEAR 2006-07 AND RS.2,36,31,400/- IN THE ASSESSMENT YEAR 2007-08. SINCE, WE HAVE RESTORED THE MATTER BACK TO THE FILE OF THE LEARNED CIT(A) FOR FRESH DECISION ON TECHNICAL ASPECT, THE DECISION OF THE L EARNED CIT(A) ON MERIT BEFORE THE FINAL DECISION ON TECHNICAL ASPECT CANNOT BE SU STAINED. THEREFORE, WE FEEL THAT THIS ISSUE ON MERIT SHOULD ALSO GO BACK TO THE FILE OF THE LEARNED CIT(A) FOR FRESH DECISION. IF IT IS FOUND BY THE LEARNED CIT(A ) THAT THE ASSESSEE HAS NO MERIT IN TECHNICAL OBJECTION, THEN HE SHOULD DECIDE THE I SSUE ON MERIT AFRESH, BUT IF IT IS FOUND THAT THE ASSESSEE SUCCEEDS IN TECHNICAL ASPEC TS, THEN THE ASSESSMENT ITSELF DOES NOT SURVIVE AND THERE IS NO NEED TO DEC IDE THE ISSUE ON MERIT. WITH THESE OBSERVATIONS, WE SET ASIDE THE ORDERS OF THE LEARNED CIT(A) IN BOTH THE YEARS ON MERIT ALSO AND RESTORE THE MATTER BACK TO HIS FILE FOR FRESH DECISION IN THE LIGHT OF THE ABOVE DISCUSSIONS AFTER PROVIDING ADEQ UATE OPPORTUNITY OF BEING HEARD TO BOTH THE SIDES. IT (SS) A NO. 811 & 812 AND CO NO.340 & 341/AHD/2010 (AY: 2006-07 AND 2007-08) SHRI DINESHBHAI P. PATEL 5 10. IN THE RESULT, BOTH THE CROSS OBJECTIONS OF THE ASSESSEE AND THE APPEALS OF THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 31-01-2013. SD/- SD/- (KUL BHARAT) JUDICIAL MEMBER (A. K. GARODIA) ACCOUNTANT MEMBER LAKSHMIKANTA DEKA/- COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) CONCERNED 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE BY ORDER ASST. REGISTRAR, ITAT, AHMEDABAD 1. DATE OF DICTATION: 29-01-2013 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE T HE DICTATING MEMBER: 30-01-2013 OTHER MEMBER: 3. DATE ON WHICH APPROVED DRAFT COMES TO THE SR. P. S./P.S.: 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE TH E DICTATING MEMBER FOR PRONOUNCEMENT: 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE S R. P.S./P.S.: 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK: 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK: 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER: 9. DATE OF DESPATCH OF THE ORDER: