ACIT, Central Circle, Belgavi V. Shivkant S Sidnal, Belgaum

ITA 108/PAN/2023

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 3219 (ITAT-PANAJI)
• Duration Of Justice: 9 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-03-2024
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2018-2019
• Appeal Filed On: 28-05-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: VARUN KOWJALGI
• Keywords: Gift; Principle of natural justice
• Section: 153

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH : PANAJI [THROUGH VIRTUAL HEARING AT ITAT PUNE] BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER I.T.A.No.108/PAN./2023 Assessment Year 2018-2019 The ACIT (Central), Saraf Colony, Shraddha Bldg., Khanapur Road, Tilakwadi – 590 006. Karnataka. vs. Shivkant S Sidnal, BC-84, Chappel Road, Belgaum Camp S.O., Karnataka. PAN ASWPS7607K (Appellant) (Respondent) For Revenue : Shri Badrinath Yamaji Chavan For Assessee : Shri Varun Kowjalgi Date of Hearing : 13.03.2024 Date of Pronouncement : 28.03.2024 ORDER PER SATBEER SINGH GODARA, J.M. : This Revenue’s appeal for assessment year 2018-2019, arises against the order of CIT(A)-2, Panaji, Panji’s Din and Order No.ITBA/APL/S/250/2022-23/1050608630(1), dated 10.03.2023 involving proceedings u/s.153A of the Income Tax Act, 1961 (in short “the Act”). Heard both the parties. Case file perused. 2. The Revenue pleads the following substantive grounds in the instant appeal : i. “Whether under the facts and circumstances of the case and in Law, the CIT(A) was right in directing the AO to delete the 2 ITA.No.108/PAN./2023 addition made on protective basis before the substantive addition has reached its finality ? ii. Whether under the facts and circumstances of the case and in Law, the CIT(A) was right in deleting the addition made on unexplained jewellery which was voluntarily included by the assessee in its returned income as admitted income and paid the taxes treating the same as double addition made ? iii. Whether under the facts and circumstances of the case and in Law, the CIT(A) was right in directing the AO to delete the jewellery amounting to Rs.73,88,840/- accepted by the assessee in the return filed in response to notice issued U/s 153 A of the Act ? iv. Any other grounds of appeal to be included during the course of appellate proceedings.” 2. Both the learned Authorised Representatives next invited our attention to the CIT(A)'s detailed discussion reversing the Assessing Officer’s action making unaccounted/unexplained jewellery addition of Rs.73,88,840/- as under : “4.4. During the appellate proceedings the AR of the appellant contended that the appellant declared Rs.73,88,833/- as the value of jewellery for the impugned assessment year on the reasoning that the same was not acquired during the year but over the years. It was also explained that the jewellery found during the search contained various items which were received as gifts on auspicious occasion such as birthdays & 3 ITA.No.108/PAN./2023 marriages by Smt. Deepa S. Sidnal. However, the AO made addition in both the A.Ys. i.e. 2018-19 and 2019-20 for the same gold seized during the course of search. 4.5. I have gone through the assessment order, submissions made by the appellant and reasoning given by the AR of the appellant during the time of hearing. On perusal of the assessment order it is found that the AO had made addition on the protective basis for impugned assessment year. This addition resulting in double taxation to the appellant as the same amount has been added in the A.Y.2019-20 as well. The AO has not followed any principles of natural justice in making the addition. Therefore, jewellery amounting to Rs.73,88,840/-, accepted by the appellant in the return of income against notice under Section 153 A of the Act is being deleted and the same may be treated as income for the A.Y. 2019-20. Ground No. 2 is accordingly allowed and the AO is directed to give telescoping benefit to the appellant for jewellery amounting to Rs.73,88,840/- by treating the same for the A.Y. 2019-20 and the benefit of tax paid by the appellant on Rs.73,88,840/- should be adjusted in the A.Y 2019- 20 instead of 2018-19.” 3. We have given our thoughtful consideration to the Revenue’s vehement contentions seeking to revive the impugned addition of Rs.73,88,840/- and find no merit therein. This is for the precise reason that the Assessing Officer’s sec.153A assessment before us dated 24.06.2021 had made the very addition for the 4 ITA.No.108/PAN./2023 succeeding assessment year 2019-2020 on “substantive” basis followed by a “protective” addition herein for assessment year 2018- 2019 in the instant appeal. Learned CIT-DR informs us very fairly that the CIT(A)'s lower appellate discussion in assessee’s appeal for assessment year 2019-2020 has upheld the very addition. That being the clinching fact coming from the Revenue’s side itself, we are of the considered view that the impugned “protective” income hardly deserves to be sustained being an instance of “double addition”. Coupled with this, there is no material before us in the case file that the impugned gold/diamond jewellery was found to have been based on the seized material pertaining to assessment year 2018-2019. We further wish to reiterate that the search herein was conducted on 01.11.2018 relevant to assessment year 2019- 2020 whereas we are in assessment year 2018-2019 only. We accordingly see no reason to revive the impugned “protective” addition in the foregoing terms. The Revenue fails in it’s sole substantive. Ordered accordingly. 4. This Revenue’s appeal is dismissed in above terms. Order pronounced in the open Court on 28.03.2024. Sd/- Sd/- [INTURI RAMA RAO] [SATBEER SINGH GODARA] ACCOUNTANT MEMBER JUDICIAL MEMBER Pune, Dated 28 th March, 2024 VBP/- 5 ITA.No.108/PAN./2023 Copy to 1. The appellant 2. The respondent 3. The Pr. CIT, Panaji concerned. 4. The D.R. ITAT, Panaji Bench, Panaji. 5. Guard File. //By Order// //True Copy // Sr. Private Secretary, ITAT, Pune Benches, Pune. S.No. Details Date 1 Draft dictated on 18.03.2024 Sr.PS 2 Draft placed before author 18.03.2024 Sr.PS 3 Draft proposed & placed before the Second Member .03.2024 J.M. 4 Draft discussed/approved by Second Member .03.2024 A.M. 5 Approved Draft comes to the Sr. PS/PS .03.2024 Sr.PS 6 Kept for pronouncement on .03.2024 Sr.PS 7 Date of uploading of Order .03.2024 Sr.PS 8 File sent to Bench Clerk .03.2024 Sr.PS 9 Date on which the file goes to the Head Clerk 10 Date on which file goes to the A.R. 11 Date of Dispatch of order