ACIT CC 39, MUMBAI V. FIRST LAND INFRA. P.LTD, NAVI MUMBAI

ITA 1372/MUM/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 3742 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 2 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-05-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 18-02-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 27-02-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A KUMBHAR
• Assessee Lawyers: RAMESH JAIN
• Keywords: Document seized; Documents seized
• Section: 69C; 27

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL ' F ' BENCH, MUMBAI BEFORE SHRI JASON P. BOAZ, ACCOUNTANT MEMBER AND SHRI SANDEEP GOSAIN , JUDICIAL MEMBER ITA NO. 1 3 7 2 /MUM/201 4 (ASSESSMENT YEAR: 200 7 - 0 8 ) ACIT, CENTRAL CIRCLE - 39 VS. M/S. FIRST LAND INFRA. P. LTD. ROOM NO. 32(1), GR. FLOOR AYAKAR BHAVAN, M.K. ROAD MUMBAI 400020 DRONAGIRI HOUSING COMPLEX BLDG. NO. GH - 10, FLAT NO. 2 GR. FLOOR, SECTOR - 30, POST BOKADVIRA VILL., URAN TALUKA RAIGAD DIST., NAVI MUMBAI - 702 PAN - AABCF0153F APPELLANT RESPONDENT APPELLANT BY: SHRI A. KUMBHAR RESPONDENT BY: SHRI RAMESH JAIN DATE OF HEARING: 05 .05 .2016 DATE OF PRONOUNCEMENT: 11 .0 5 .2016 O R D E R PER JASON P. BOAZ, A.M . THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE CIT(A) - 4 1 , MUMBAI DATED 30 . 11 .201 3 FOR A.Y. 2007 - 08 DELETING THE PENALTY OF ` 47,30,481/ - LEIVED UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 (IN SHORT 'THE ACT') IN THE CASE ON HAND. 2 . THE GROUNDS RAISED BY REVENUE IN THIS APPEAL ARE AS UNDER: - 1 WHETHER ON THE FACTS AND I N THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING PENALTY LEVIED U/S. 271(1)(C) STATING THAT THE ADDITION UNDER SECTION 69C DOES NOT SURVIVE SINCE THE ISSUE OF ACTION U/S. 153C AND THE QUANTUM ADDITION MADE UNDER SECTION 69C OF T HE I.T. ACT, 1969 HAS BEEN DELETED BY THE HON'BLE ITAT, MUMBAI WITHOUT APPRECIATING THE FACT THAT DEPARTMENT HAS PREFERRED AN APPEAL AGAINST THE ORDER OF THE HON'BLE ITAT, MUMBAI BEFORE THE HON'BLE BOMBAY HIGH COURT AND THE ISSUES HAVE NOT ATTAINED FINALIT Y. THE APPELLANT PRAYS THAT THE ORDER OF THE COMMISSIONER OF INCOME - TAX (APPEAL) ON THE ABOVE GROUNDS BE SET ASIDE AND THAT THE INCOME TAX OFFICER/AC/DC BE RESTORED. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUNDS OR ADD NEW GROUND WHICH MAY BE NECESSARY. IT A NO. 1372/MUM/2014 M/S. FIRST LAND INFRA. P. LTD. 2 3 . WE HAVE HEARD BOTH THE LEARNED D.R. FOR REVENUE AND THE LEARNED A.R. FOR THE ASSESSEE IN THE MATTER IN THE CASE. AT THE OUTSET, IT WAS SUBMITTED BEFORE THE BENCH THAT THE LEARNED CIT(A) DELETED THE PENALTY OF ` 47,30,481/ - LEVIED UNDER SECTION 27 1(1)(C) OF THE ACT IN A.Y. 2007 - 08, SINCE THE QUANTUM ADDITION OF ` 1,53,09,000/ - MADE UNDER SECTION 69C OF THE ACT IN RESPECT OF WHICH THE SAID PENALTY WAS LEVIED HAS BEEN DELETED BY THE DECISION OF A COORDINATE BENCH OF THIS TRIBUNAL IN ASSESSEES OWN CAS E IN ITA NO. 8251/MUM/2011 DATED 22.03.2013 FOR A.Y. 2007 - 08. THIS FACT IS NOT DISPUTED AND FORMS PART OF THE GROUNDS RAISED BY REVENUE (SUPRA), IN WHICH IT IS ALSO SUBMITTED THAT REVENUE HAS NOT ACCEPTED THE AFORESAID DECISION OF THE COORDINATE BENCH (SUP RA) AND HAS PREFERRED AN APPEAL AGAINST THE SAME BEFORE THE HON'BLE BOMBAY HIGH COURT. 4 . WE FIND FROM A PERUSAL OF THE ORDER OF THE COORDINATE BENCH OF THIS TRIBUNAL IN ITA NO. 8251/MUM/2011 DATED 22.03.2013 THAT AT PARAS 18, 19, 22, 23, 24, 25 AND 26 HAS HE LD AS UNDER: - 18. ...... IN THE PRESENT CASE, IMPUGNED DOCUMENTS WERE NOT FOUND FROM THE POSSESSION OF THE ASSESSEE BUT WAS FOUND FROM THE POSSESSION OF A THIRD PERSON I.E. SHRI DILIP DHERAI. MERE MENTION OF THE NAMES OF THE VILLAGES WHERE THE COMPANIES MAY HAVE PURCHASED LANDS COULD NOT GIVE ANY BASIS TO ASSUME/PRESUME/SURMISE THAT THE NAME OF THE COMPANIES ARE MENTIONED IN THE IMPUGNED DOCUMENT. THE VERY FOUNDATION OF SEC. 153C HAS BEEN SHAKEN BY NOT FULFILLING THE CONDITION PRECEDENT FOR THE ISSUE OF N OTICE ...... 29. CONSIDERING THE ENTIRE FACTS AND CIRCUMSTANCES IN THE LIGHT OF THE IMPUGNED SEIZED DOCUMENTS, WE HAVE NO HESITATION TO HOLD THAT ACTION TAKEN U/S. 153C OF THE ACT IS BAD IN LAW ..... 22. ..... THE ENTIRE DISPUTE REVOLVES AROUND THE ALLEG ED CASH PAYMENT AMOUNTING TO RS.43 CRORES APPROX. AND WHICH HAS BEEN ADDED U/S. 69C OF THE ACT ..... 23. ..... THE ASSESSEE MUST HAVE BEEN FOUND TO HAVE INCURRED ANY EXPENDITURE TO INVOKE THE PROVISIONS OF SEC. 69C OF THE ACT ...... HOWEVER, THE ALLEGATI ONS MADE BY THE LOWER AUTHORITIES ARE NOT SUPPORTED BY ACTUAL CASH PASSING HANDS. THE ENTIRE ADDITIONS ARE BASE ON THE SEIZED DOCUMENTS AND NO OTHER MATERIAL HAS BEEN ADVERTED TO AND WHICH COULD CONCLUSIVELY SHOW THAT THE HUGE ACCOUNT OF THE MAGNITUDE MENT IONED IN THE SEIZED DOCUMENTS TRAVELLED FROM ONE SIDE TO THE OTHER. THE REVENUE AUTHORITIES HAVE NOT BROUGHT A SINGLE STATEMENT ON RECORD OF THE VENDORS OF LAND IN DIFFERENT VILLAGES. NONE OF THE SELLER HAS BEEN EXAMINED TO SUBSTANTIATE THE CLAIM OF THE RE VENUE THAT EXTRA CASH ACTUALLY CHANGED HANDS. IT A NO. 1372/MUM/2014 M/S. FIRST LAND INFRA. P. LTD. 3 24. ..... IN THE PRESENT CASE, NONE OF THE SELLERS HAVE BEEN EXAMINED BY THE A.O. TO STRENGTHEN HIS VIEWS THAT CASH HAS BEEN PAID OVER AND ABOVE THE REGISTERED AMOUNT. THERE IS NOT EVEN A SINGLE DOCUMENT/ EVIDE NCE OF PARTIES INVOLVED IN THE SALE OF LAND AT DIFFERENT VILLAGES BROUGHT O RECORD TO SHOW THAT AN AMOUNT OTHER THAN THE PAYMENT OF CONSIDERATION HAS CHANGED HANDS. NO CONFUSION FROM THE SELLERS HAVE BEEN BROUGHT ON RECORD ..... 25. ...... IN OUR CONSIDERA TE VIEW (SIC), THERE BEING NO EVIDENCE TO SUPPORT THE REVENUES CASE THAT A HUGE FIGURE, WHATEVER BE ITS QUANTUM, OVER AND ABOVE THE FIGURE BOOKED IN THE RECORDS AND ACCOUNTS CHANGED HANDS BETWEEN THE PARTIES, NO ADDITION COULD THEREFORE BE MADE U/S. 69C O F THE ACT TO THE INCOME OF THE ASSESSEE CONSIDERING THE ENTIRE FACTS BROUGHT ON RECORD, WE HAVE NO HESITATION TO HOLD THAT EVEN ON MERITS, NO ADDITION COULD BE SUSTAINED. 26. SINCE WE HAVE ALLOWED THE ISSUE IN THE CASE OF THE PRESENT ASSESSEE ON BOTH COUN TS, I.E. ON LEGAL ISSUE AND ON MERIT AND THE ISSUE INVOLVED IN ALL OTHER APPEALS OF OTHER ASSESSEES ARE SIMILAR AND IDENTICAL THOUGH QUANTUM MAY DIFFER, FOR SIMILAR REASONS, WE QUASH THE ASSESSMENTS AND DELETE THE ADDITIONS ON MERIT AS WELL AS ON POINT OF LAW IN ALL OTHER CASES ALSO. 5 . IT IS EVIDENT FROM THE ORDER OF THE COORDINATE BENCH OF THIS TRIBUNAL (SUPRA) THAT THE TRIBUNAL HAS NOT ONLY QUASHED THE ASSESSMENTS FRAMED UNDER SECTION 153C OF THE ACT BUT ALSO DELETED THE ADDITIONS OF ` 1,53,09,000/ - MADE UNDER SECTION 69C OF THE ACT ON MERITS. SINCE THE ORDER OF ASSESSMENT AND THE ADDITIONS THEREIN GIVING RISE TO THE LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT IS QUASHED/DELETED, THE PENALTY OF ` 47,30,481/ - LEVIED THEREUNDER WOULD NOT SURVIVE. IN THIS VIEW OF THE MATTER, RESPECTFULLY FOLLOWING THE DECISION OF THE COORDINATE BENCH OF THIS TRIBUNAL IN THE ASSESSEES OWN CASE IN ITA NO. 8251/MUM/2011 DATED 22.03.2103, WE UPHOLD THE ORDER OF THE LEARN ED CIT(A) DELETING THE PENALTY OF ` 47,30,481/ - LEVIED UNDER SECTION 271(1)(C) OF THE ACT FOR A.Y. 2007 - 08 IN THE CASE ON HAND. CONSEQUENTLY, THE GROUNDS RAISED BY REVENUE ARE DISMISSED. 6 . IN THE RESULT, THE REVENUES APPEAL FOR A.Y. 2007 - 08 IS DISMISSED . ORD ER PRONOUNCED IN THE OPEN COURT ON 11 TH MAY , 2016 . SD/ - SD/ - ( SANDEEP GOSAIN ) ( JASON P. BOAZ ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 11 TH MAY , 2016 IT A NO. 1372/MUM/2014 M/S. FIRST LAND INFRA. P. LTD. 4 COPY TO: 1 . THE APPELLANT 2 . THE RESPONDENT 3 . THE CIT(A) - 41 , MUMBAI 4 . THE CIT , CENTRAL - III , MUMBAI 5 . THE DR, F BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.