ITO 23(3)(2), MUMBAI V. REETA J. DHAWAN, NAVI MUMBAI

ITA 1338/MUM/2011

• Counselvise Citation: 133819914 RSA 2011
• Duration Of Justice: 3 year(s) 10 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-01-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 01-01-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 14-02-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: AKHILENDRA YADAV
• Assessee Lawyers: JUGAL T DHAWAN
• Keywords: Opportunity of being heard

Judgement Text

, , , ,, , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES D MUMBAI , , ! ' BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI RAJENDRA, ACCOUNTANT MEMBER . / ITA NO.1338/MUM/2011 #$ #$ #$ #$ %$ %$ %$ %$ / ASSESSMENT YEAR: 2007-08 ITO. 23(3)(2), C-10, 4 TH FLOOR,ROOM NO.403, PRATYAKSHKAR BHAVAN, BKC, BANDRA (E), MUMBAI-400051 VS. SMT. REETA J. DHAWAN, 01, MARVEL APARTMENTS, AIROLI, NAVI MUMBAI ( ! / REVENUE) ( &'() /RESPONDENT) P.A. NUMBER : AALPD5768R ! * ** * + + + + /REVENUE BY : SHRI AKHILENDRA YADAV &'() * ** * + + + + /RESPONDENT BY SHRI JUGAL T. DHAWAN # * , / DATE OF HEARING : 01/01/2015 -.% * , / DATE OF PRONOUNCEMENT : 02/01/2015 O R D E R PER JOGINDER SINGH, JM: THE REVENUE IS AGGRIEVED BY THE IMPUGNED ORDER DATE D 06/12/2010 OF THE LD. FIRST APPELLATE AUTHORITY, MU MBAI, ON 2 SMT. REETA J. DHAWAN. THE GROUND THAT THE LD. FIRST APPELLATE AUTHORITY E RRED IN DELETING THE ADDITION ESTIMATING THE NET PROFIT AT RS.3,20,730/- WITHOUT APPRECIATING THAT THE ASSESSING OFFICER COL LECTED INFORMATION OF THE PROFIT IN THE SIMILAR LINE OF BU SINESS ACTIVITY AND FOUND THAT AVERAGE NET PROFIT WAS 3.16% AND THU S HE ESTIMATED THE NET PROFIT AT 3% AND FURTHER DELETING THE ADDITION MADE ON ACCOUNT OF SUNDRY CREDITORS AND AD VANCES AMOUNTING TO RS.1,47,79,209/- ADMITTING FRESH EVIDE NCE, ALSO DELETING THE ADDITION OF RS.12,13,000/- ON ACCOUNT OF UNSECURED LOANS. 2. AT THE TIME OF HEARING, SHRI AKHILENDRA YADAV, L D. DR FOR THE REVENUE DEFENDED THE CONCLUSION ARRIVED AT IN T HE ASSESSMENT ORDER WHICH ARE IDENTICAL TO THE GROUND RAISED. MR. YADAV CONTENDED THAT THE ASSESSING OFFICER COLLECTE D INFORMATION FROM THE MARKET AND FOUND THAT THE NET PROFIT IN TH E SIMILAR LINE OF BUSINESS WAS 3.16% , THEREFORE, HIS ESTIMATION W AS QUITE REASONABLE. ON THE ISSUE OF SUNDRY CREDITORS AND A DVANCES AMOUNTING TO RS.1,47,79,209/-, THE LD. DR PLEADED T HAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) DELETED THE AD DITION ADMITTING FRESH EVIDENCES WHICH IS VIOLATION OF RUL E 46A OF THE IT RULES. SO FAR AS, DELETING THE ADDITION OF RS.12,1 3,000/- MADE ON ACCOUNT OF UNSECURED LOANS, MR YADAV CONTENDED T HAT THE ASSESSEE FAILED TO ESTABLISH THE CAPACITY AND CREDI TWORTHINESS OF LOAN CREDITORS. THE ASSESSMENT ORDER WAS DEFENDED. 3 SMT. REETA J. DHAWAN. 2.1. ON THE OTHER HAND, THE HUSBAND OF THE ASSESSEE , SHRI JUGAL DHAWAN, DEFENDED THE CONCLUSION ARRIVED AT BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS). 2.2. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND P ERUSED THE MATERIAL AVAILABLE ON RECORD. WITHOUT GOING INTO M UCH DELIBERATION, WE FIND THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) GRANTED RELIEF TO THE ASSESSEE WITHOUT ME ETING OUT THE OBJECTIONS RAISED IN THE ASSESSMENT ORDER LEADING T O THE ADDITIONS CONTAINED IN THE ASSESSMENT ORDER. EVEN NO REMAND REPORT WAS SOUGHT FROM THE ASSESSING OFFICER AS FRE SH EVIDENCE SUCH AS LEDGER ACCOUNT OF SUNDRY CREDITORS ALONGWIT H OTHER DETAILS OF PAYMENT THROUGH BANK ACCOUNT WERE NOT FU RNISHED DURING ASSESSMENT PROCEEDINGS, THUS, IT IS VIOLATIO N OF RULE 46A OF THE IT RULES 1962. LIKEWISE, ASSESSEE DID NOT E STABLISH THE CAPACITY AND THE CREDITWORTHINESS OF THE LOAN CREDI TORS DURING ASSESSMENT PROCEEDINGS. IN VIEW OF THESE FACTS, TH E IMPUGNED ORDER IS SET ASIDE TO THE FILE OF THE LD. COMMISSIO NER OF INCOME TAX (APPEALS) FOR FRESH ADJUDICATION IN ACCORDANCE WITH LAW. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) IS DIRECTE D TO CALL FOR THE REMAND REPORT FROM THE ASSESSING OFFICER. THE ASSESSEE ALSO BE GIVEN OPPORTUNITY OF BEING HEARD WITH FURTHER LI BERTY TO FURNISH EVIDENCE, IF ANY, IN SUPPORT OF HER CLAIM S O THAT NO PREJUDICE IS CAUSED TO EITHER SIDE, CONSEQUENTLY, T HE APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES ONL Y. FINALLY, THE APPEAL OF THE REVENUE IS ALLOWED FOR S TATISTICAL PURPOSES ONLY. 4 SMT. REETA J. DHAWAN. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 01/01/2015. SD/- SD/- (RAJENDRA) (JOGINDER SINGH ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED - 02/01/2015 F{X~{T? P.S/. # . . / / / / * ** * &,0 &,0 &,0 &,0 10%, 10%, 10%, 10%, / COPY OF THE ORDER FORWARDED TO : 1. () / THE APPELLANT 2. &'() / THE RESPONDENT. 3. 2 ( ) / THE CIT(A)- 4. 2 / CIT 5. 034 &,# , , / DR, ITAT, MUMBAI 6. 4$ 5 / GUARD FILE. /# /# /# /# / BY ORDER, '0, &, //TRUE COPY// 6 66 6 / 7 7 7 7 (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI