KHALIL AHMED TANWAR, MUMBAI V. ITO 8(2)(2), MUMBAI

ITA 1249/MUM/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 1281 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 1 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-04-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 03-03-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESH KUMAR YADEV
• Assessee Lawyers: S C TIWARI
• Keywords: Unexplained cash credit; Gift; Residential status; Opportunity of being heard; Principle of natural justice; Transactions in derivatives; Cost of acquisition
• Section: 143(3); 133(6); 68; 10

Judgement Text

A IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ./ I.T.A. NO.1249 /MUM/2015 ( / ASSESSMENT YEARS : 2010-11) MR. KHALIL AHMED TANWAR, A/301, SWATI BUILDING, JUHU LANE, ANDHERI (W), MUMBAI 400 058. / V. ITO 8(2)(2), AAYAKAR BHAWAN, M.K. ROAD, MUMBAI 400 020 ./ PAN :ABZPT6169M ( / APPELLANT ) .. ( / RESPONDENT ) ASSESSEE BY : SHRI S.C. TIWARI & MS. RUTUJA N. PAWAR REVENUE BY : SHRI RAJESH KUMAR YADEV / DATE OF HEARING : 22-03-2017 / DATE OF PRONOUNCEMENT : 10-04-2017 / O R D E R PER RAMIT KOCHAR, ACCOUNTANT MEMBER THIS APPEAL, FILED BY THE ASSESSEE, BEING ITA NO. 1249/MUM/2015 IS DIRECTED AGAINST THE APPELLATE ORDER DATED 1ST DECE MBER, 2014 PASSED BY LEARNED COMMISSIONER OF INCOME TAX (APPEALS)- 17, M UMBAI (HEREINAFTER CALLED THE CIT(A)), FOR THE ASSESSMENT YEAR 2010- 11, THE APPELLATE PROCEEDINGS BEFORE THE LEARNED CIT(A) ARISING FROM THE ASSESSMENT ORDER DATED 1ST MARCH, 2013 PASSED BY LEARNED ASSESSING O FFICER (HEREINAFTER CALLED THE AO) U/S 143(3) OF THE INCOME-TAX ACT,1961 (HE REINAFTER CALLED THE ACT). ITA 1249/MUM/2015 2 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE IN MEMO OF APPEAL FILED WITH THE INCOME-TAX APPELLATE TRIBUNAL, MUMBAI (HER EINAFTER CALLED THE TRIBUNAL) READ AS UNDER:- 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE OF THE APPELLANT AND IN LAW, ID. CIT (APPEAL) HAS ERRED IN UPHOLDING THE ADDITION U/S. 68 OF RS.10,00,000/- GIFT RECEIVED BY THE APPELLANT FROM HIS FATHER. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE OF THE APPELLANT AND IN LAW, ID. CIT (APPEAL) HAS ERRED IN UPHOLDING THE ADDITION U/S 69A OF RS.32,66,411/- TO THE INCOME OF THE APPELLANT. 3. WITHOUT PREJUDICE TO THE GROUND NO.1 & 2 ABOVE, ON TH E FACTS AND IN THE CIRCUMSTANCES OF THE CASE OF THE APPELLANT A ND IN LAW, ID. CIT (APPEAL) HAS ERRED IN NOT CONSIDERING THAT ID. AO HAS MADE AN ADDITION OF RS.10,00,000/- -GIFT MONEY TO THE INCOME OF THE APPELLANT ASSUMING THAT RS.32,66,411/- SHOWN IN THE APPELLANT'S FATHER'S ACCOUNT IS ALSO THE APPELLANT'S MONEY, EFFECTIVELY A DDING THE SAME RS.10,00,000/- TO THE INCOME OF THE APPELLANT TWICE. 4. THAT ON THE FACTS AND IN THE CIRCUMSTANCE OF THE CA SE OF THE APPELLANT AND IN LAW, ID. CIT (APPEAL) HAS ERRED UPH OLDING THE ADDITION U/S. 68 OF RS.2,60,000/- LOAN RECEIVED BY THE APPELL ANT FROM HIS BROTHER. 5. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE OF THE APPELLANT AND IN LAW, ID. CIT (APPEAL) HAS ERRED IN UPHOLDING THE ADDITION OF RS.9,94,313/ - AS UNDISCLOSED INCOME OF THE APPELLANT. 6. THAT THE IMPUGNED ORDER BEING CONTRARY TO LAW, MATE RIAL ON RECORD AND FACTS OF THE CASE MAY KINDLY BE SET ASIDE, AMENDED AND MODIFIED IN THE LIGHT OF THE GROUNDS OF APPEAL ENUMER ATED ABOVE AND THE APPELLANT BE GRANTED SUCH RELIEFS AS IS CALLED FO R ON THE FACTS AND IN THE CIRCUMSTANCE OF THE CASE OF THE APPELLANT AND IN L AW. 7. THAT EACH OF THE GROUNDS OF APPEAL ENUMERATED ABO VE IS WITHOUT PREJUDICE TO EACH OTHER AND INDEPENDENT OF ONE ANOTHE R. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS DIRECTOR IN M/S LIS (INDIA) CONSTRUCTION CO. PRIVATE LIMITED. DURING TH E COURSE OF ASSESSMENT PROCEEDINGS U/S 143(3) R.W.S. 143(2) OF 1961 ACT, T HE A.O. OBSERVED THAT IN THE PERSONAL CAPITAL ACCOUNT OF THE ASSESSEE , THE ASSESSEE HAS CREDITED GIFT OF ITA 1249/MUM/2015 3 RS. 10 LACS RECEIVED FROM HIS FATHER, SHRI LIYAQUET ALI TANWAR. THE ASSESSEE WAS ASKED TO PROVE THE GENUINENESS OF THE SAID GIFT TRANSACTION AND CAPACITY OF THE DONOR. THE ASSESSEE FILED A COPY OF CONFIRMA TION OF THE GIFT AND BANK STATEMENT OF THE DONOR I.E. HIS FATHER MR. LIYAQUET ALI TANWAR . THE DONOR HAD SAVING BANK-NRE A/C NO. 50099 MAINTAINED WITH INDI AN OVERSEAS BANK. THE A.O. OBSERVED FROM THE BANK STATEMENT THAT IT S HOWED A PAYMENT DEBIT OF RS. 10 LACS TOWARDS THE ASSESSEE ON 6 TH OCTOBER, 2009 BUT JUST TEN DAYS BEFORE ADVANCING OF THIS GIFT, THE BANK ACCOUNT SHO WED RECEIPT CREDIT OF RS.32,66,411/- WITH THE NARRATION RTGS KHALIL AHME D . THE SAID KHALIL AHMED WAS CONFIRMED BY THE COUNSEL OF THE ASSESSEE TO BE THE ASSESSEE ONLY. THE ASSESSEE WAS ASKED BY THE AO TO FILE DETAILS OF ALL BANK ACCOUNTS MAINTAINED BY THE ASSESSEE JOINTLY OR SINGLY. THE A SSESSEE SUBMITTED THAT HE HELD ONLY FOUR BANK ACCOUNTS, THE TWO ACCOUNTS WITH INDIAN OVERSEAS BANK AND ICLCI BANK RESPECTIVELY WHICH WERE CLAIMED BY T HE ASSESSEE TO BE OPERATIVE. WHILE THE NRE A/C HELD WITH THE SAME IND IAN OVERSEAS BANK AND AN ACCOUNT WITH BANK OF BARODA WERE CLAIMED BY THE ASSESSEE TO BE INOPERATIVE. THE AO OBSERVED THAT BALANCE SHEET OF THE ASSESSEE ALSO DISCLOSED THESE FOUR BANK ACCOUNTS MAINTAINED BY TH E ASSESSEE. THE COUNSEL FOR THE ASSESSEE CONFIRMED TO THE AO THAT THE SAID AMOUNT OF RS. 32,66,411/- WAS REMITTED BY THE ASSESSEE AND KHALID AHMED AS REFLECTED IN THE BANK ACCOUNT OF THE FATHER OF THE ASSESSEE IS NONE OTHER THAN THE ASSESSEE WHO REMITTED RS. 32,66,441/- FROM OVERSEAS TO HIS FATHE R , SH. LIYAQUET ALI TANWAR. THE AO OBSERVED THAT NONE OF THE SAID BANK ACCOUNTS REFLECTED AN AMOUNT OF RS. 32,66,411/- BEING REMITTED BY THE ASS ESSEE TO HIS FATHER , SHRI LIYAQUET ALI TANWAR. THE ASSESSEE WAS ASKED TO PRO DUCE THE BANK STATEMENT OF OVERSEAS BANK ACCOUNT HELD BY THE ASSESSEE AND S IMULTANEOUSLY NOTICE U/S 133(6) OF THE ACT WAS ISSUED TO THE INDIAN OVERSEAS BANK CALLING THE FOLLOWING INFORMATION:- ITA 1249/MUM/2015 4 1) DETAILS OF ALL BANK A/C'S, SINGLY OR JOINTLY HE LD BY ABOVE ASSESSEE DURING FY 2009-10. 2) COPIES OF ALL BANK STATEMENTS OF SUCH A/C FOR TH E FINANCIAL YEAR 2009-10. 3) DETAILS OF FD'S OR ASSETS OF SIMILAR NATURE MAIN TAINED BY MY ABOVE ASSESSEE DURING F Y 2009-10. 4) BANK STATEMENT OF SB-NRE A/C NO. 50099 OF SHRI L IYAQUET ALI TANWAR FOR FY 2009-10 AND FIRC OF ALL THE CREDI TS TO SUCH A/C FROM SHRI KHALIL AHMED FROM FY 2007-08 TO 2010-11. THE INDIAN OVERSEAS BANK SUBMITTED ONLY BANK STATEM ENTS OF SHRI LIYAQUET ALI TANWAR FROM 2007 TO 2011 AND COPIES OF THE BANK STATEMENT OF THE ASSESSEE BANK A/C NO. 020901000007217 AND 020910005 0490 FROM 01-04- 2009 TO 31-03-2010. WITH REGARD TO THE DEPOSIT OF RS. 32,66,411/-, THE ASSESSEE SUBMITTED BEFORE THE A.O. THAT THE ASSESSEE WAS A NON-RESIDENT INDIA N IN THE YEAR 2006-07 AND HIS FATHER MR. LIYAQUET ALI TANWAR AND OTHER FAMILY MEMBERS WERE ALL NON- RESIDENT AND WERE BASED IN THE GULF SINCE 25-30 YEA RS. IT WAS SUBMITTED THAT MR. KHALIL AHMED TANWAR I.E. THE ASSESSEE, WAS ALSO IN THE GULF FOR MORE THAN 20 YEARS AND HAD ACQUIRED MANY BUSINESS INTEREST. W HEN HE WAS NON- RESIDENT (NRI) , THE MOTHER OF THE ASSESSEE EXPIRED 2-3 YEARS BACK AND A FAMILY SETTLEMENT WAS NOT COMPLETED AND HER ASSET A RE STILL NOT DISTRIBUTED DUE TO ABSENCE OF ANY CLEAR WILL BY HIS MOTHER. T HE ASSESSEE ALSO SUBMITTED THAT THE ASSESSEE WAS A NON-RESIDENT TILL 2006-07 A ND HE DOES NOT HAVE ANY OVERSEAS BANK ACCOUNT AS ALL HIS NRI OR NRE ACCOUNT WERE CLOSED OR DEFUNCT. IT WAS SUBMITTED THAT MR. LIYAQUET ALI TANWAR FATHE R OF THE ASSESSEE IS NON RESIDENT OF INDIA FOR 30-40 YEARS AND HE HAD MANY B USINESS INTEREST IN GULF. THE ASSESSEE CLAIMED THAT ONE MR. KHAMIS SAEED KHAM IS MANA WHO IS GULF CITIZEN AS WELL AS RESIDENT OF GULF HAD GIVEN A POW ER OF ATTORNEY TO MR. KHALIL AHMED TANWAR(I.E. ASSESSEE) TO OPERATE HIS COMPANY ACCOUNT WITH ADBC ITA 1249/MUM/2015 5 BANK A/C NO. 332742010001 AND THE SAID BANK ACCOUNT BELONGS TO AI- KHAMIS SAEED GENERAL MAINTENANCE LLC , A COMPANY IN CORPORATED IN GULF AND IT WAS CLAIMED BEFORE THE AO THAT ASSESSEE DOES NOT HOLD ANY INTEREST IN ABOVE SAID COMPANY AND THE ASSESSEE IS ONLY A POWER OF ATTORNEY HOLDER TO OPERATE THE SAID ACCOUNT. IT WAS SUBMITTED THAT THE SAID COMPANY STARTED SOME CONSTRUCTION ACTIVITY AND DOES NOT HAVE ANY PR OFIT AS DUE TO HEAVY RECESSION IN REALTY MARKET IN GULF , THE PROJECT CO ULD NOT BE SOLD. IT WAS SUBMITTED THAT THE SAID AMOUNT OF RS. 32,66,411/- W AS PAID FROM THE ABOVE SAID COMPANY BANK ACCOUNT IN GULF TO MR LIYAQUET AL I TANWAR ON 16.09.2009 AND IT WAS JUST A LOAN TRANSACTION BETWEEN THEM. I T WAS SUBMITTED THAT THE ABOVE CONTENTION OF THE ASSESSE CAN BE VERIFIED BY BANK ADVICE/STATEMENT AND POWER OF ATTORNEY, WHICH WAS PRODUCED BY THE ASSESS EE BEFORE THE A.O. . THE ASSESSEE , HOWEVER, SUBMITTED THAT LOAN CONFIRMATIO N FROM THE SAID COMPANY AI-KHAMIS SAEED GENERAL MAINTENANCE LLC AND LIYAQUE T ALI TANWAR IS BEING OBTAINED FOR THE SAID TRANSACTION OF RS. 32,66,411/ - BETWEEN THEM , WHICH WILL BE FURNISHED , BUT NO SUCH CONFIRMATION WAS FI NALLY SUBMITTED BY THE ASSESSEE. THE A.O., HOWEVER, REJECTED THE CONTENTION OF THE ASSESSEE AS THE CREDIT OF RS. 32,66,411/- IS APPEARING IN THE NRE ACCOUNT OF THE FATHER OF THE ASSESSEE ON BEHALF OF THE REMITTANCE SENT BY THE ASSESSEE. THE A.O. OBSERVED THAT ASSESSEES BALANCE SHEET DID NOT INCLUDE ANY SUCH B ANK ACCOUNT , INDIAN OR OVERSEAS FROM WHICH SUCH REMITTANCE WAS SENT AND TH E ASSESSEE HAS NOT EXPLAINED THE SOURCE OF REMITTING AN AMOUNT OF RS. 32,66,411/- TO HIS FATHER, WITH THE SUPPORT OF SUFFICIENT DOCUMENTARY EVIDENCE S. THE AO, THEREFORE , MADE AN ADDITION OF RS. 32,66,411/- IN THE HANDS OF THE ASSESSEE AS UNEXPLAINED MONEY U/S 69A OF 1961 ACT, VIDE ASSESSM ENT ORDER DATED 01-03- 2013 PASSED BY THE AO U/S 143(3) OF 1961 ACT. ITA 1249/MUM/2015 6 THE AO ALSO OBSERVED THAT THE ASSESSEE COULD NOT ES TABLISH THE GENUINENESS/CREDITWORTHINESS OF HIS FATHER MR. LIYA QUET ALI TANWAR I.E. THE DONOR IN GIVING GIFT OF RS. 10,00,000 TO THE ASSESS EE. THUS, THE AO MADE AN ADDITION OF RS. 10,00,000/- AS UNEXPLAINED CASH CRE DIT U/S 68 OF 1961 ACT, VIDE ASSESSMENT ORDER DATED 01-03-2013 PASSED BY TH E AO U/S 143(3) OF 1961 ACT. SIMILARLY, THE ASSESSEE RECEIVED AN UNSECURED LOAN OF RS. 2,60,000/- FROM HIS BROTHER SHRI BASRAT ALI TANWAR. THE ASSESSEE WAS A SKED TO FILE COPIES OF BANK STATEMENT OF THE LOAN CREDITOR. THE A.O. OBSERVED F ROM BANK STATEMENT THAT THE ALLEGED LOAN WAS ADVANCED TO THE ASSESSEE ON 27 TH JULY 2009 AND JUST SIX DAYS BEFORE ADVANCEMENT OF THE LOAN, THERE WAS A CR EDIT OF EQUAL AMOUNT IN THE BANK ACCOUNT OF SH. BASRAT ALI TANWAR. THE ASS ESSEE WAS ASKED TO IDENTIFY THE SOURCE OF SUCH CREDIT AND PROVE THE CA PACITY OF THE LOAN CREDITOR , BUT NO DETAILS WERE SUBMITTED BY THE ASSESSEE . THU S, THE A.O. MADE ADDITION OF RS. 2,60,000/- AS UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT , VIDE ASSESSMENT ORDER DATED 01-03-2013 PASSED BY THE AO U/S 143(3) OF 1961 ACT.. FURTHER, THE A.O. OBSERVED FROM THE COMPUTATION OF INCOME THAT THE ASSESSEE DECLARED IN HIS RETURN OF INCOME A SHORT TERM CAPIT AL GAIN OF RS.1,59,644/- ON SALE OF SHARES. IT WAS OBSERVED BY THE A.O. THAT BO TH THE STATEMENT OF COMPUTATION OF INCOME AND THE CAPITAL ACCOUNT IN TH E BALANCE SHEET MENTIONED THE SALE CONSIDERATION AND PURCHASE COST AT RS. 18,06,704/- AND RS. 16,47,060/- RESPECTIVELY AND AGAINST THIS INCOM E, A BROUGHT FORWARD LOSS OF RS.1,59,644/- OF ASSESSMENT YEAR 2009-10 WAS SET OFF. THE ASSESSEE WAS ASKED TO FILE DETAILS OF PURCHASES, SALE , DEMAT ST ATEMENT, BROKERS LEDGER, CONTRACT NOTE ETC. . AGAINST THIS, THE ASSESSEE SUB MITTED SOME UNSIGNED STATEMENT FROM M/S MF GLOBAL SIFY SECURITIES INDIA PVT. LTD. WHEREBY THE TOTAL VALUE OF PURCHASE AND SALE OF SHARES IN FINAN CIAL YEAR 2009-10 WERE ITA 1249/MUM/2015 7 SHOWN AT RS. 68,38,740/- AND RS. 70,16,611/- RESPEC TIVELY, WITH NET PROFIT OF RS. 1,59,644/-. THE A.O. OBSERVED THAT THERE WAS N O CONSISTENCY IN THE SUBMISSION OF THE DETAILS. AS PER THE BALANCE SHEET , STATEMENT OF COMPUTATION OF INCOME AND FORM NO.10DB, THE TOTAL VALUE OF PURC HASE AND SALE OF SHARES WERE SHOWN AT RS.16,47,060/- AND RS. 18,06,704/- RE SPECTIVELY. SUBSEQUENTLY, THE SAME WAS SHOWN AT RS. 68,38,740/- AND RS. 70,16,611/- RESPECTIVELY. AS PER UNSIGNED STATEMENT OF MF GLOB AL SIFY SECURITIES INDIA P. LTD FILED BY THE ASSESSEE, IT WAS OBSERVED BY THE AO THAT THERE WERE TOTAL DEBITS OF RS. 48,56,542.64 WHILE CREDITS ARE TO THE TUNE OF RS. 60,80,453.27 INCLUDING OPENING BALANCE OF RS. 2,29,597.95 . THIS STATEMENT ALSO SHOWED MANY DEBIT AND CREDITS ON ACCOUNT OF TRANSFERS FROM AND TO THE DERIVATIVE SEGMENTS , WHILE THE ASSESSEE HAS NOT FILED ANY DET AILS OF DERIVATIVE TRANSACTIONS. THE ASSESSEE DID NOT FILE ANY EVIDENC E THAT SUCH TRANSACTIONS IN DERIVATIVES WERE ENTERED THROUGH RECOGNIZED STOCK E XCHANGES. NO CONTRACT NOTES WERE FILED AND COMPLIANCE AS STIPULATED U/S 4 3(5) OF 1961 ACT W.R.T. DERIVATIVE TRANSACTION WERE NOT DONE AND THE TRANSA CTIONS WERE , THUS, TREATED BY THE AO AS SPECULATIVE TRANSACTIONS. THUS, NET CR EDIT BALANCE OF RS. 12,23,910/- APPEARING IN THE NAME OF THE ASSESSEE I N THE STATEMENT OF MF GLOBAL SIFY SECURITIES INDIA PRIVATE LIMITED AFTER REDUCING THE OPENING BALANCE OF RS. 2,29,597.95, I.E. THE REMAINING CREDIT BALAN CE OF RS. 9,94,313/- WAS ADDED AS UNDISCLOSED INCOME BEING SPECULATION PROFI T BY THE AO IN THE HANDS OF THE ASSESSEE , VIDE ASSESSMENT ORDER DATED 01-03 -2013 PASSED BY THE AO U/S 143(3) OF 1961 ACT.. 4. AGGRIEVED BY THE ASSESSMENT ORDER DATED 01-03-2 013 PASSED BY THE A.O. U/S 143(3) OF 1961 ACT, THE ASSESSEE FILED FIRST AP PEAL BEFORE THE LD. CIT(A) WHEREBY THE ASSESSEE REITERATED THE SUBMISSION WHAT WERE MADE BEFORE THE A.O. THE LD. CIT(A), HOWEVER, REJECTED THE SAME AN D THE ADDITION MADE BY THE A.O. WAS CONFIRMED AND LEARNED CIT(A) DISMISSED THE APPEAL FILED BY THE ASSESSEE, VIDE APPELLATE ORDER DATED 01-12-2014 ITA 1249/MUM/2015 8 5. AGGRIEVED BY THE APPELLATE ORDER DATED 01-12-201 4 PASSED BY LEARNED CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUN AL. 6. THE LD. COUNSEL FOR THE ASSESSEE ARGUED BEFORE U S THAT THE EVIDENCES FILED BY THE ASSESSEE HAVE NOT BEEN PROPERLY APPREC IATED BY THE LOWER AUTHORITIES. THE LD. COUNSEL PRAYED THAT IF ONE MO RE OPPORTUNITY IS GIVEN, THE ASSESSEE CAN PRODUCE ALL THE NECESSARY EVIDENCES AN D EXPLAIN IT PROPERLY BEFORE THE AUTHORITIES BELOW AND SUBSTANTIATE ITS C LAIM, WHICH CAN BE EXAMINED AND VERIFIED BY THE AUTHORITIES BELOW ON M ERITS. IT IS SUBMITTED THAT ASSESSEE WILL DULY SUBMIT ALL NECESSARY EVIDENCES T O SUBSTANTIATE CREDITWORTHINESS, IDENTITY AND GENUINENESS OF GIFT /LOAN TRANSACTIONS AS WELL NRI STATUS OF THE FAMILY MEMBERS WILL BE PROVED TO SUBSTANTIATE ITS CLAIM TO THE SATISFACTION OF THE AO WHICH CAN BE EXAMINED AN D VERIFIED BY THE AO ON MERITS. 7. LEARNED D.R. ON THE OTHER HAND RELIED UPON THE O RDER OF THE LD. CIT(A) . 8. WE HAVE CONSIDERED RIVAL CONTENTIONS AND ALSO PE RUSED THE MATERIAL AVAILABLE ON RECORD. WE HAVE OBSERVED THAT THE ASS ESSEE HAD RECEIVED GIFT OF RS. 10 LACS FROM HIS FATHER, SHRI LIYAQUET ALI TANW AR. THE ASSESSEE DID PRODUCED BANK STATEMENT OF THE FATHER BUT COULD NOT ESTABLISH THE CREDITWORTHINESS OF HIS FATHER TO THE SATISFACTION OF THE AO IN ACCORDANCE WITH MANDATE OF SECTION 68 OF 1961 ACT. THE ASSESSEE HA S CLAIMED THAT FATHER IS AN NRI AND HAS BUSINESS INTEREST IN GULF BUT NECESS ARY EVIDENCES TO SUBSTANTIATE THE SAME WERE NOT SUBMITTED TO ESTABLI SH RESIDENTIAL STATUS OF FATHER AND HIS BUSINESS INTEREST IN GULF TO THE SAT ISFACTION OF THE AO. THE PASSPORT OF FATHER WAS SUBMITTED BUT COMPLETE DETAI LS TO ESTABLISH HIS RESIDENTIAL STATUS AS PER PROVISIONS OF THE ACT WER E NOT SUBMITTED AS ALSO HIS CLAIM OF BEING NRI BASED IN GULF HAVING SEVERAL BUS INESS INTEREST ETC WERE NOT ITA 1249/MUM/2015 9 SUBMITTED, TO THE SATISFACTION OF THE AO TO SATISFY THE MANDATE OF PROVISIONS OF THE ACT. THE ASSESSEE HAS NOW CLAIMED THAT THE EVID ENCES AND EXPLANATIONS WHICH WERE SUBMITTED BEFORE THE AO WERE NOT PROPERL Y APPRECIATED AND ALSO THE REMAINING EVIDENCES AS THE AO MAY REQUIRE TO RE ACH SATISFACTION THAT MANDATE OF SECTION 68 OF 1961 ACT ARE COMPLIED WITH WILL BE SUBMITTED TO THE SATISFACTION OF THE AO. IT WAS ALSO SUBMITTED THAT THE AO CAN MAKE NECESSARY EXAMINATION AND VERIFICATIONS TO VERIFY EVIDENCES A ND EXPLANATIONS ON MERITS AND THE ASSESSEE HAS PRAYED THAT ONE MORE OPPORTUNI TY BE GRANTED TO THE ASSESSEE TO PRODUCE ALL THESE EVIDENCES AND EXPLANA TIONS BEFORE THE AO AND MATTER MAY BE SET ASIDE TO THE FILE OF AO FOR DE-NO VO DETERMINATION OF THE ISSUE ON MERITS BY AO. IT IS ALSO CLAIMED THAT THE EVIDENCES SUBMITTED WERE NOT PROPERLY APPRECIATED BY THE AO. AN AMOUNT OF R S. 32,66,411/- WAS FOUND CREDITED IN HIS FATHERS BANK ACCOUNT AND ENTRY IN THE SAID BANK REFLECTED AS CREDIT BEING SENT BY THE ASSESSEE. THE ASSESSEE HA S CLAIMED THE SAID AMOUNT BEING LOAN ADVANCED BY A COMPANY IN GULF NAMELY AI- KHAMIS SAEED GENERAL MAINTENANCE LLC BUT COGENT DOCUMENTS TO SUBSTANTIAT E THE SAME WERE NOT SUBMITTED.HOWEVER, THE ASSESSEE SUBMITTED AN BANK A DVISE WHEREIN NAME OF SAID COMPANY IS REFLECTED. THESE EVIDENCES NEED VER IFICATIONS AND EXAMINATION BY THE AO , AND ALSO LOAN CONFIRMATIONS ETC WERE ST ATED BY THE ASSESSEE TO BE PRODUCED BEFORE THE AO WHICH WAS NOT PRODUCED BY TH E ASSESSEE, NEED TO BE PRODUCED WITH ANY OTHER DOCUMENTS / EXPLANATION WHI CH THE AO MAY CONSIDER APPROPRIATE TO SATISFY THE MANDATE OF PROV ISIONS OF 1961 ACT. THE ASSESSEE HAS ALSO RECEIVED LOAN OF RS. 2,60,000/- F ROM HIS BROTHER BASRAT ALI AND THE ASSESSEE DULY SUBMITTED BANK STATEMENT OF B ROTHER MR. BASRAT ALI . THE ASSESSE HOWEVER COULD NOT EXPLAIN THE SOURCE OF CREDIT IN THE SAID BANK ACCOUNT OF HIS BROTHER OUT OF WHICH THE SAID LOAN W AS ADVANCED BY HIS BROTHER TO THE ASSESSEE. THE ASSESSEE CLAIMED THAT THE BROT HER OF THE ASSESSEE WAS SETTLED IN GULF AND IS AN NRI, FOR WHICH THE ASSESS EE IS DIRECTED TO PRODUCE ALL NECESSARY EVIDENCES BEFORE THE AO SO THAT NECESSARY VERIFICATIONS AND EXAMINATION CAN BE UNDERTAKEN BY THE AO TO ESTABLIS H HIS CREDITWORTHINESS ITA 1249/MUM/2015 10 ETC SO THAT MANDATE OF SECTION 68 OF 1961 ACT CAN B E MET. WITH RESPECT TO THE SHORT TERM CAPITAL GAIN OF RS. 1,59,644/- ON SALE O F SHARES, NO PAYMENT/RECEIPTS ON ACCOUNT OF SALE AND PURCHASE OF SHARES WERE APPEARING IN THE BANK ACCOUNT STATEMENT BROUGHT ON RECORD. T HE ASSESSEE ALSO ENTERED INTO DERIVATIVE TRANSACTIONS FOR WHICH NO DETAILS W ERE FILED AS STATED BY THE AO. THE ASSESSEE , HOWEVER, HAS FILED STATEMENT OF BROKERS WHICH NEED TO BE EVALUATED AND EXAMINED ON MERITS BY THE AO TO COMPU TE CORRECT INCOME WHICH ARE CHARGEABLE TO TAX. KEEPING IN VIEW PECULI AR FACTUAL MATRIX OF THIS CASE AS DISCUSSED BY US IN THIS ORDER AND KEEPING I N VIEW INTEREST OF JUSTICE IN OUR CONSIDERED VIEW, IN ORDER TO COMPUTE CORRECT IN COME OF THE ASSESSEE TO BRING THE SAME TO TAX IN ACCORDANCE WITH PROVISIONS OF 1961 ACT, ONE MORE OPPORTUNITY IS REQUIRED TO BE GRANTED TO THE ASSESS EE TO EXPLAIN ITS CONTENTIONS AND ALSO SO THAT THE ASSESSEE CAN PRODU CE ALL THE NECESSARY DOCUMENTS/EVIDENCES BEFORE THE A.O. TO ENABLE HIM T O COMPUTE CORRECT INCOME CHARGEABLE TO TAX AND BRING THE SAME TO TAX W.R.T. ALL THE ISSUES WHICH HAS ARISEN IN THIS APPEAL. AS SUCH, WE SET ASIDE AN D RESTORE ALL THE ISSUES ARISING FROM THIS APPEAL BACK TO THE FILE OF THE A. O. FOR DE NOVO DETERMINATION OF THE ISSUES ON MERITS, AFTER CONSIDERING EXPLANAT IONS/ EVIDENCES FILED BY ASSESSEE IN HIS DEFENSE AND AFTER CONDUCTING SUCH V ERIFICATION, ENQUIRY AND EXAMINATION AS THE AO MAY CONSIDER APPROPRIATE IN A CCORDANCE WITH LAW. THE AO IS DIRECTED TO ADMIT ALL MATERIAL AND COGENT EVI DENCES AND EXPLANATIONS FILED BY THE ASSESSEE IN HIS DEFENSE IN DE-NOVO PRO CEEDINGS BEFORE THE AO AND CONSIDER THE SAME ON MERITS. NEEDLESS TO SAY, THAT THE ASSESSEE MAY BE GIVEN SUFFICIENT OPPORTUNITY OF BEING HEARD BY THE AO IN ACCORDANCE WITH PRINCIPLES OF NATURAL JUSTICE IN ACCORDANCE WITH LAW. WE ORDER ACCORDINGLY. 9. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IN I TA NO. 1249/MUM/2015 FOR THE ASSESSMENT YEAR 2010-11 IS ALLOWED FOR STAT ISTICAL PURPOSE. ITA 1249/MUM/2015 11 ORDER PRONOUNCED IN THE OPEN COURT ON 10 TH APRIL, 2017. # $% &' 10-04-2017 ( ) SD/- SD/- (D.T. GARASIA) (RAMIT KOCHAR) JUDICIAL MEMBER ACCOUNTANT MEMBER $ MUMBAI ; & DATED 10-04-2017 [ .9../ R.K. R.K. R.K. R.K. , EX. SR. PS !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. : ( ) / THE CIT(A)- CONCERNED, MUMBAI 4. : / CIT- CONCERNED, MUMBAI 5. =>( 99?@ , ?@ , $ / DR, ITAT, MUMBAI A BENCH 6. (BC D / GUARD FILE. / BY ORDER, = 9 //TRUE COPY// / ( DY./ASSTT. REGISTRAR) , $ / ITAT, MUMBAI