UDAY SALVI, MUMBAI V. ITO 18(1)(3), MUMBAI

ITA 1295/MUM/2011

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 2970 (ITAT-MUMBAI)
• Duration Of Justice: 5 year(s) 4 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-06-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 11-03-2015
• Assessment Year: 2001-2002
• Appeal Filed On: 11-02-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K RAVI RAMACHANDRAN
• Assessee Lawyers: VENUGOPAL C NAIR
• Section: 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH F, MUMBAI BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER ITA NOS.1295, 1296, 1297, 1298 & 1299/M/2011 ASSESSMENT YEARS: 2001-02, 2002-03, 2003-04, 2004-0 5 & 2005-06 SHRI UDAY A SALVI, 4/162 AMBEDKAR NAGAR CHS, BHAGOJI WAGMARE ROAD, WORLI, MUMBAI - 18 PAN: AAEPS 0346T VS. ITO 18(1)(3), 1 ST FLOOR, PIRAMAL CHAMBERS, LALBAUG, MUMBAI 400 012 (APPELLANT) (RESPONDENT) PRESENT FOR: ASSESSEE BY : SHRI VENUGOPAL C NAIR, A.R. REVENUE BY : SHRI K. RAVI RAMACHANDRAN, D.R. DATE OF HEARING : 23.06.2016 DATE OF PRONOUNCEMENT : 29.06.2016 O R D E R PER BENCH: THE ABOVE CAPTIONED APPEALS FOR DIFFERENT ASSESSME NT YEARS HAVE BEEN PREFERRED BY THE ASSESSEE AGAINST THE SEPARATE ORDE RS OF EVEN DATE 30/9/2010 OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) [H EREIN AFTER REFERRED TO AS CIT(A)]. SINCE THE FACTS AND THE ISSUES INVOLVED IN ALL THE CAPTIONED APPEALS ARE IDENTICAL IN NATURE, HENCE, THE SAME ARE TAKEN TOGETHER FOR DISPOSAL BY THIS COMMON ORDER. FOR THE SAKE OF CONVENIENCE, THE FACT S HAVE BEEN TAKEN FROM ASSESSEES APPEAL FOR AY2001-02 BEARING ITA NUMBER 1295/ MUM/ 11. 2. THE FACTS, IN BRIEF, ARE THAT THE ASSESSEE WAS O PERATING IN THE NAME AND STYLE OF SHREERAM VIDEO CHANNEL PROVIDING CABLE C ONNECTIONS IN THE VICINITY OF WORLI MUMBAI. THE INCOME TAX OFFICER (INVESTIGAT ION) UNIT-1 RECEIVED A TAX EVASION PETITION AGAINST THE ASSESSEE. AN INCOM E TAX INSPECTOR WAS DEPUTED FOR FIELD INQUIRY. THE INSPECTOR REPORTED T HAT THE ASSESSEE WAS ACTUALLY RECEIVING A SUM OF RS.250/- PER MONTH FROM EACH SUB SCRIBER, AGAINST WHICH THE ITA NOS.1295, 1296, 1297, 1298 & 1299/M/2011 SHRI UDAY A SALVI 2 ASSESSEE WAS FOUND TO BE SHOWING ONLY RS. 210/-. SI MILARLY SOME DISCREPANCIES WERE FOUND IN THE NUMBER OF CONNECTIONS DISTRIBUTED . THIS ENTIRE EXERCISE WAS RELATED TO FINANCIAL YEAR 2005-06.IN THE MEANWHILE, ON THE BASIS OF INFORMATION RECEIVED FROM THE INVESTIGATION WING TO VERIFY THE INCOME DECLARED BY THE ASSESSEE FOR FINANCIAL YEAR 200506 RELEVANT TO AY 2006-07, THE ASSESSING OFFICER (HEREINAFTER REFERRED TO AS THE AO) REOPENE D THE ASSESSMENT FROM AY 2000 01 ON WORDS. ON THE BASIS OF REPORT OF INSPE CTOR, THE AO OBSERVED THAT THE ASSESSEE HAD CONCEALED INCOME TO THE EXTENT OF RS. 28.32 LAKHS IN THE FINANCIAL YEAR 2005-06. FOR THE YEAR UNDER CONSID ERATION I.E. AY 200102, THE AO MADE ADDITION OF RS.3 8,58,460/- ON ACCOUNT OF D IFFERENCE IN CABLE SUBSCRIPTION CHARGES AND FURTHER DISALLOWED RS.4,12 ,601 BEING 50% OF THE EXPENSES CLAIMED OF RS. 825202/-. SIMILAR TYPE OF A DDITIONS WERE ALSO MADE FOR THE SUBSEQUENT YEARS UP TO AY 2005-06. THE LEAR NED CIT(A) CONFIRMED THE ADDITIONS SO MADE BY THE AO OBSERVING THAT THE AO H AD REASONS TO BELIEVE THAT THE INCOME OF THE ASSESSEE FOR THE YEAR UNDER CONSI DERATION HAD ESCAPED ASSESSMENT. 3. BEFORE US, THE LD. AR OF THE ASSESSEE, AT THE OU TSET, HAS SUBMITTED THAT FOR A.Y. 200001 ALSO, THE ASSESSMENT WAS REOPENED ON SIMILAR GROUNDS. THE ASSESSEE CHALLENGED THE VERY REOPENING OF THE ASSES SMENT BY FILING APPEAL BEFORE THE CIT(A). THE LEARNED CIT(A) VIDE HIS ORDE R DATED 20.2.2008 QUASHED THE REOPENING OF THE ASSESSMENT FOR A.Y. 2000 01. AGAINST THE ORDER OF THE CIT(A), THE DEPARTMENT FILED APPEAL BEFORE THE TRIB UNAL. THE TRIBUNAL VIDE ITS ORDER DATED 1.6.2009 PASSED IN ITA NO.3125/M/2008 U PHELD THE ORDER OF THE CIT(A) IN QUASHING THE REOPENING OF THE ASSESSMENT FOR A.Y.200001. THE LEARNER AR OF THE ASSESSEE HAS FURTHER STATED THAT THE ABOVE STATED ORDER OF THE TRIBUNAL HAS BEEN FURTHER UPHELD BY THE HONBLE BOM BAY HIGH COURT IN ITA NO. 824 OF 2010 VIDE ORDER DATED 6.6.2011. HE, THE REFORE, HAS SUBMITTED THAT SINCE THE REOPENING IN ALL THE ABOVE STATED ASSESSM ENT YEARS WAS MADE FOR IDENTICAL REASONS, THEREFORE, THE SAME IS REQUIRED TO BE QUASHED IN THE LIGHT OF ITA NOS.1295, 1296, 1297, 1298 & 1299/M/2011 SHRI UDAY A SALVI 3 THE ORDER OF THE HONBLE BOMBAY HIGH COURT IN THE O WN CASE OF THE ASSESSEE FOR A.Y. 2000 01. 4. WE HAVE HEARD THE RIVAL CONTENTIONS OF THE LEARN ED REPRESENTATIVES OF THE PARTIES. THE TRIBUNAL IN THE CASE OF THE ASSESSEE F OR A.Y. 2000 01 HAS OBSERVED THAT THERE WAS NO INFORMATION AVAILABLE TO THE AO REGARDING SUPPRESSION OF INCOME AND OFFERING LESSER RATE AS A GAINST ACTUAL SUBSCRIPTION RECEIVED BY THE ASSESSEE FOR THE ASSESSMENT YEAR 20 00-01. THAT THE RELIANCE OF THE AO ON THE REPORT OF THE INSPECTOR WAS MISPLACED AS THE REPORT OF THE INSPECTOR WAS POSTERIOR TO THE DATE OF ISSUANCE OF NOTICE UNDER SECTION 148 OF THE ACT. THAT THE AO HAD NO BASIS WITH HIM BEFORE I SSUING NOTICES UNDER SECTION 148 AND WAS RATHER ACTING ON PRESUMPTIONS O NLY. THE ABOVE FINDINGS OF THE TRIBUNAL HAS BEEN FURTHER UPHELD BY THE HONBLE HIGH COURT VIDE ORDER DATED 6/6/2011(SUPRA). THE RELEVANT PART OF THE ORD ER OF THE HONBLE HIGH COURT PASSED IN ITA NO. 824 OF 2010, FOR THE SAKE O F READY REFERENCE, IS REPRODUCED AS UNDER: 2. THE TRIBUNAL IN PARAGRAPH 3 OF ITS JUDGMENT HAS REPORTED THAT THE INFORMATION ABOUT THE ESCAPEMENT OF INCOME COLLECTE D BY THE INCOME TAX INSPECTOR RELATED TO THE ASSESSMENT YEAR 200607 AN D THAT INFORMATION HAD NO RELATION TO THE ASSESSMENT YEAR IN QUESTION NAMELY ASSESSMENT YEAR 200001. THUS, THE REOPENING OF THE ASSESSMENT IS HELD TO BE BAD I N LAW ON THE GROUND THAT THERE WAS NO MATERIAL FOR REOPENING OF THE ASSESSMENT. TH US, THE DECISION OF THE TRIBUNAL IS BASED ON FINDING OF FACT AND NO SUBSTANTIAL QUES TION OF LAW ARISES FROM THE ORDER OF THE TRIBUNAL. HENCE THE APPEAL IS DISMISSED WITH NO ORDER AS TO COSTS. 5. THE LEARNED DR OF THE DEPARTMENT HAS FAIRLY ADMI TTED THAT THE REOPENING IN THE ABOVE CAPTIONED APPEALS FOR A. Y. 2001-02 TO A. Y. 2005 06 HAS BEEN MADE BY THE AO ON IDENTICAL FACTS AND ON THE BASIS OF IDENTICAL REASONING AS GIVEN IN THE CASE FOR A.Y. 2000 01. THE FACTS OF THE CASES BEFORE US BEING IDENTICAL TO THAT OF THE A. Y. 200001, HENCE, IN T HE LIGHT OF THE DECISION DATED 6.6.2011 (SUPRA) OF THE HONBLE JURISDICTIONAL HIGH COURT, WHICH IS OTHERWISE BINDING ON THIS TRIBUNAL, WE HOLD THAT THE REOPENIN G OF THE ASSESSMENTS IN RELATION TO THE ASSESSMENT YEARS UNDER CONSIDERATIO N WAS BAD IN LAW AND THE SAME IS THEREFORE QUASHED. ITA NOS.1295, 1296, 1297, 1298 & 1299/M/2011 SHRI UDAY A SALVI 4 6. IN THE RESULT, ALL THE ABOVE CAPTIONED APPEALS O F THE ASSESSEE ARE HEREBY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 29.06.2016. SD/- SD/- (G.S. PANNU) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 29.06.2016. * KISHORE, SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ B Y ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.