ASST CIT CEN CIR 8(4), MUMBAI V. ZAIREEN TRAVEL SERVICE, MUMBAI

ITA 1145/MUM/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 8838 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-01-2017
• Appeal Filed By: Department
• Bench Allotted: G
• Next Hearing Date: 25-01-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 26-02-2015
• Court: TRIBUNAL
• Keywords: Unexplained expenditure; Income from undisclosed sources; Search and seizure; Loose papers; Document seized; Opportunity of being heard; Documents seized
• Section: 143(3); 153A

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, G MUMBAI , , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER ITA NOS.1145 & 1146/MUM/2015 ASSESSMENT YEARS: 2010-11 & 2011-12 ACIT, CC-8(4), ROOM NO.658, 6 TH FLOOR, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI-400020 / VS. M/S ZAIREEN TRAVEL SERVICES 19-A1-KARIM MANZIL, PALTON ROAD, MUMBAI-400001 ( / REVENUE) ( !'# $ /ASSESSEE) PAN. NO . AAAFZ0160A ITA NOS.1206/MUM/2015 ASSESSMENT YEARS: 2011-12 M/S ZAIREEN TRAVEL SERVICES 19-A1-KARIM MANZIL, PALTON ROAD, MUMBAI-400001 / VS. ACIT, CC-8(4), ROOM NO.658, 6 TH FLOOR, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI-400020 ( !'# $ /ASSESSEE) ( / REVENUE) PAN. NO . AAAFZ0160A ITA NOS.1145, 1146 AND 1206/MUM/2015 M/S ZAIREEN TRAVELS SERVICE 2 % & $ ' / DATE OF HEARING : 25/01/2017 & $ ' / DATE OF ORDER: 30/01/2017 / O R D E R PER JOGINDER SINGH(JUDICIAL MEMBER) THIS BUNCH OF THREE APPEALS OUT OF WHICH FOR ASSESS MENT YEAR 2010-11 AND 2011-12 ARE BY THE REVENUE, WHEREA S, THE ASSESSEE IS IN CROSS APPEAL FOR ASSESSMENT YEAR 201 1-12 AGAINST THE IMPUGNED ORDER ALL DATED 23/12/2014 OF THE LD. FIRST APPELLATE AUTHORITY, MUMBAI. 2. FIRST, WE SHALL TAKE UP THE APPEAL OF THE REVEN UE (ITA NO.1145/MUM/2015)(ASSESSMENT YEAR 2010-11), WHEREIN, GROUND NOS. 1 & 2 ARE WITH RESPECT TO DELE TING THE DISALLOWANCE OF RS.86,92,845/- BEING DIFFERENCE BET WEEN INCOME SHOWN IN SEIZED PROFIT & LOSS ACCOUNT OF RS.1,44,11,784/- AND INCOME AS PER AUDITED PROFIT & LOSS ACCOUNT OF RS.57,18,339/-, AS UNDISCLOSED INCOME ON THE BASIS OF LOOSE PAPER, WITHOUT APPRECIATING THE PROV ISIONS OF SECTION 132(4) OF THE INCOME TAX ACT, 1961 (HEREINA FTER THE ACT) AND FURTHER IGNORING THE FACTUAL MATRIX. 2.1. DURING HEARING, THE LD. CIT-DR, MISS. VIDISHA KALRA, DEFENDED THE ADDITION MADE BY THE ASSESSING OFFICER ! / REVENUE BY MISS VIDISHA KALRA CIT-DR !'# $ ! / ASSESSEE BY SHRI AJAY R. SINGH ITA NOS.1145, 1146 AND 1206/MUM/2015 M/S ZAIREEN TRAVELS SERVICE 3 WHICH WAS ARGUED TO BE ON THE BASIS OF CORROBORATIV E MATERIAL. OUR ATTENTION WAS INVITED TO PARA-6(PAGE- 6) OF THE IMPUGNED ORDER AND ARGUED THAT THE FACTS IN THE CAS ES, RELIED UPON BY THE LD. COMMISSIONER OF INCOME TAX (APPEAL) ARE ON DIFFERENT FACTS AS ONUS CAST UPON THE ASSESSEE WAS NOT DISCHARGED. IT WAS ALSO CONTENDED THAT THE FIGURES ARE NOT TALLYING. 2.2. ON THE OTHER HAND, SHRI AJAY R. SINGH, LD. CO UNSEL FOR THE ASSESSEE, CONTENDED THAT THE ASSESSEE IS ME RELY ENTITLED FOR COMMISSION OUT OF THE TRAVELLING BUSIN ESS. OUR ATTENTION WAS INVITED TO PAGES -44 & 45 OF THE PAPE R BOOK, WHICH ARE COPIES OF THE SEIZED DOCUMENT BY EXPLAINI NG THAT THE DEPARTMENT ADDED BOTH THE FIGURES. FROM PAGE-4 6 OF THE PAPER BOOK, THE LD. COUNSEL EXPLAINED THAT THE FIGU RES MATCH WITH THE AUDITED BOOKS OF ACCOUNTS (PAGE-15 OF THE PAPER BOOK). THE CRUX OF THE ARGUMENTS IS THAT ALL THE FI GURE ARE TALLYING, WHICH HAS NOT BEEN DISPUTED BY THE ASSESS ING OFFICER AND THE LOOSE PAPERS HAS TO BE CORROBORATED WITH THE INDEPENDENT EVIDENCE AND SUCH LOOSE PAPERS ARE MERE LY DUMP DOCUMENTS. THE IMPUGNED ORDER WAS DEFENDED. 2.3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT THE ASSESSMENT WAS COMPLETED U/S 153A R.W. S 143(3) OF THE ACT. A SEARCH AND SEIZURE ACTION WAS INITIATED AGAINST THE ASSESSEE, WHEREIN, CERTAIN LOOSE PAPERS WERE SEIZED. STATEMENT WAS ALSO RECORDED. AS PER THE SIZ ED ITA NOS.1145, 1146 AND 1206/MUM/2015 M/S ZAIREEN TRAVELS SERVICE 4 DOCUMENTS/ROUGH PROFIT & LOSS ACCOUNT, THERE WAS IN COME OF RS.1,44,11,784/-(ZAIREEN IATA-PROFIT OF RS.4,75,442 + RS.ZAIREEN-VISA RS.1,39,36,342/-), WHEREAS, AS PER THE AUDITED BOOKS OF ACCOUNTS IT WAS RS.57,18,339/-. TH E ASSESSEE WAS ASKED TO RECONCILE THE BALANCE SHEET A ND PROFIT & LOSS ACCOUNT WITH AUDITED FINANCIAL STATEMENTS. THE LD. ASSESSING OFFICER ADDED THE DIFFERENCE OF RS.86,92, 845/- (RS.1,44,11,784-57,18,339) AS UNACCOUNTED INCOME OF THE ASSESSEE (I.E. DIFFERENCE IN PROFIT & LOSS ACCOUNT) . 2.4. ON APPEAL, THE LD. COMMISSIONER OF INCOME TAX (APPEAL) CONSIDERED THE FACTUAL MATRIX AND DELETED THE ADDITION. THE REVENUE IS IN APPEAL BEFORE THIS TRIB UNAL. 2.5. IF THE OBSERVATION MADE IN THE ASSESSMENT ORD ER, LEADING TO ADDITION MADE TO THE TOTAL INCOME, CONCL USION DRAWN IN THE IMPUGNED ORDER, MATERIAL AVAILABLE ON RECORD, ASSERTIONS MADE BY THE LD. RESPECTIVE COUNSEL, IF K EPT IN JUXTAPOSITION AND ANALYZED, IT IS NOTED THAT AS PER AUDITED BOOKS OF ACCOUNTS, THE TOTAL INCOME OF THE ASSESSEE WAS RS.2,24,21,235/-, WHICH IS MORE THAN THE SEIZED ROU GH PROFIT & LOSS ACCOUNT OF RS.1,39,36,342/-, MEANING THEREBY , THE ASSESSEE HAS OFFERED MORE INCOME COMPARE TO THE ROU GH NOTING MENTIONED IN THE SEIZED PROFIT & LOSS ACCOUN T. THE ASSESSEE IS MERELY ENTITLED TO COMMISSION IN THE BU SINESS OF TRAVELLING. WE HAVE PERUSED THE PAPER BOOK PAGES 44 & 45 (SEIZED DOCUMENTS), WHEREIN, IT IS NOTED THAT BOTH THE FIGURES WERE ADDED BY THE DEPARTMENT. THE LD. COUNSEL FOR T HE ITA NOS.1145, 1146 AND 1206/MUM/2015 M/S ZAIREEN TRAVELS SERVICE 5 ASSESSEE JUSTIFIABLY EXPLAINED THE FACTUAL MATRIX B EFORE US AND WE FIND THAT THE FIGURES EXPLAINED BY THE ASSES SEE ARE MATCHING WITH THE AUDITED BOOKS OF ACCOUNTS (PAGE-1 5). WE HAVE ALSO PERUSED THE FIGURES MENTIONED AT PAGE-44 AND ARE COMPARED WITH THE FIGURES MENTIONED AT PAGE-47 OF T HE PAPER BOOK. WHERE THE FIGURES, AS PER THE REVENUE, ARE MISMATCHING, THE LD. COUNSEL DULY EXPLAINED THE SAM E, MEANING THEREBY, THESE FIGURES ARE DULY TALLYING WI TH THE FIGURES CONTAINED IN THE CONSOLIDATED IN THE PROFIT & LOSS ACCOUNT. IN VIEW OF THIS FACTUAL MATRIX, WE FIND NO INFIRMITY IN THE CONCLUSION OF THE LD. COMMISSIONER OF INCOME TA X (APPEAL), THUS, THIS APPEAL OF THE REVENUE IS HAVIN G NO MERIT, CONSEQUENTLY, DISMISSED. 3. NOW, WE SHALL TAKE UP THE APPEAL OF THE REVENUE (ITA NO.1146/MUM/2015). THE LD. DR, DEFENDED THE AD DITION MADE BY THE LD. ASSESSING OFFICER. IT IS NOTED THAT THE LD. COMMISSIONER OF INCOME TAX (APPEAL) DELETED THE ADD ITION OF RS.11 LAKH MADE ON ACCOUNT OF PAYMENT VOUCHERS AND AS UNEXPLAINED EXPENDITURE, ON THE BASIS OF LOOSE PAPE RS. THE CRUX OF THE ARGUMENT IS THAT THE LD. COMMISSIONER O F INCOME TAX (APPEAL) DID NOT APPRECIATE THE FIGURES MENTION ED IN THE LOOSE PAPERS ALONG WITH THE PROVISIONS OF SECTION 1 32(4) OF THE ACT. THE BENCH RAISED A QUERY WHETHER ANY APPEAL HA S BEEN FILED BY THE ASSESSEE IN THE CASE OF SISTER CONCERN . THE LD. COUNSEL FOR THE ASSESSEE STATED AT BAR THAT IN THE CASE OF OTHER PARTY/SISTER CONCERN, VIDE ORDER DATED 28/11/ 2014, THE ADDITION WAS SUSTAINED AND NEITHER ANY APPEAL WAS F ILED, IN ITA NOS.1145, 1146 AND 1206/MUM/2015 M/S ZAIREEN TRAVELS SERVICE 6 THE CASE OF SISTER CONCERN, NOR ANY APPEAL WILL BE FILED. IN VIEW OF THIS STATEMENT OF THE LD. COUNSEL FOR THE A SSESSEE, AT BAR, WE ARE OF THE VIEW THAT THE SAME ADDITION CANN OT BE MADE AT TWO PLACES, THEREFORE, WE AFFIRM THE STAND OF THE LD. COMMISSIONER OF INCOME TAX (APPEAL). THIS APPEAL OF THE REVENUE IS ALSO DISMISSED. 4. NOW, WE SHALL TAKE UP THE APPEAL OF THE ASSESSE E (ITA NO.1206/MUM/2015), WHEREIN, THE ONLY GROUND PE RTAINS TO CONFIRMING THE ADDITION OF RS.83 LAKHS MADE ON T HE BASIS OF ENTRY FOUND IN THE BOOKS OF INDO-SAUDI CARRIER P VT. LTD.. THE CRUX OF ARGUMENT ON BEHALF OF THE ASSESSEE IS T HAT THE LD. COMMISSIONER OF INCOME TAX (APPEAL) DID NOT APPRECI ATE THE FACT THAT THE ASSESSEE FILED CONFIRMATION FROM THE SAID PARTY STATING THAT NO SUCH ENTRY OF RS.83 LAKHS WERE REFL ECTED IN THEIR BOOKS, THEREFORE, THE ADDITION IS WITHOUT ANY BASIS. THE LD. COUNSEL FURTHER EXPLAINED THAT NO ADDITION WAS MADE OF THIS AMOUNT IN THE CASE OF SISTER CONCERN. THE LD. COUNSEL INVITED OUR ATTENTION TO PAGE-13 (PARA-11) OF THE I MPUGNED ORDER. THE LD. DR HAD NO OBJECTION IF THE MATTER MA Y BE EXAMINED AFRESH BY THE ASSESSING OFFICER. CONSIDERI NG THE TOTALITY OF FACTS, ASSERTION MADE BY THE LD. COUNSE L FOR THE ASSESSEE, THE LD. ASSESSING OFFICER IS DIRECTED TO EXAMINE THE FACTUAL MATRIX AND ALSO TO EXAMINE WHETHER IN THE C ASE OF SISTER CONCERN WITH RESPECT TO THIS ADDITION, ALONG WITH THE SOURCE AND GENUINENESS OF THE AMOUNT INVOLVED. THE ASSESSEE BE PROVIDED OPPORTUNITY OF BEING HEARD TO ITA NOS.1145, 1146 AND 1206/MUM/2015 M/S ZAIREEN TRAVELS SERVICE 7 SUBSTANTIATE ITS CLAIM. THUS, THIS APPEAL OF THE AS SESSEE IS ALLOWED FOR STATISTICAL PURPOSES ONLY. FINALLY, APPEALS OF THE REVENUE ARE DISMISSED, WHER EAS, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTIC AL PURPOSES ONLY. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 25/01/2017. SD/- SD/- ( MANOJ KUMAR AGGARWAL ) (JOGINDER SINGH) '!# / ACCOUNTANT MEMBER $!# /JUDICIAL MEMBER % MUMBAI; ) DATED : 30/01/2017 F{X~{T? P.S/. . . %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. +,- / THE APPELLANT (RESPECTIVE ASSESSEE) 2. ./,- / THE RESPONDENT. 3. 0 0 1$ ( + ) / THE CIT, MUMBAI. 4. 0 0 1$ / CIT(A)- , MUMBAI, 5. 34 .$! , 0 +' ! 5 , % / DR, ITAT, MUMBAI 6. 6' 7% / GUARD FILE. ! / BY ORDER, /3+$ .$ //TRUE COPY// /! (DY./ASSTT. REGISTRAR) , % / ITAT, MUMBAI