SHIVKUMAR C. ACHARYA, MUMBAI V. ITO WD 19(1)(3), MUMBAI

ITA 1424/MUM/2016

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 9016 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2007-2008
• Appeal Filed On: 15-03-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJAT MITTAL
• Keywords: Reason to believe
• Section: 143(3); 147; 148

Judgement Text

INCOME TAX APPELLATE TRIBUNAL, BENCH C, MUMBAI BEFORE SHRI P.K. BANSAL, VICE-PRESIDENT AND SHRI PAWAN SINGH, JUDICIAL MEMBER ITA NO. 1424/MUM/2016 (ASSESSMENT YEARS- 2007-08) SHRI SHIVKUMAR C. ACHARYA 502/503, RAM KRISHNA CHAMBERS, OPP. GHANASINGH JEWELLERS, LINKING ROAD, KHAR (WEST), MUMBAI-400052. PAN: AABPA7703M VS . ITO WARD-9(1)(3), AAYAKAR BHAVAN, M.K. ROAD, MUMBAI-400020. (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : SHRI RAJAT MITTAL (DR) DATE OF HEARING : 08.08.2017 DATE OF PRONOUNCEMENT : 11.10.2017 ORDER UNDER SECTION 254(1) OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER 1. THIS APPEAL BY ASSESSEE UNDER SECTION 253 OF THE IN COME-TAX ACT (THE ACT) IS DIRECTED AGAINST THE ORDER OF LD. COMMISSIONER OF I NCOME-TAX (APPEALS)-21, MUMBAI [LD. CIT(A)], MUMBAI DATED 17.02.2016 FOR AS SESSMENT YEAR (AY) 2007-08. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE F ILED HIS RETURN OF INCOME FOR RELEVANT AY ON 08.01.2008 DECLARING TOTAL INCOME OF RS. 3,33,008/-. THE ASSESSMENT WAS COMPLETED ON 21.12.2009 U/S 143(3) O F THE ACT ACCEPTING THE RETURN INCOME OF ASSESSEE. SUBSEQUENTLY, THE RETURN OF INCOME WAS RE- ITA NO.1424/M/2016 S HRI SHIVKUMAR C. ACHARYA 2 OPENED. THE NOTICE U/S 148 DATED 25.02.2013 WAS SER VED UPON THE ASSESSEE. IN RESPONSE TO THE NOTICE, THE ASSESSEE VIDE HIS R EPLY DATED 02.08.2013 CONTENDED THAT THE RETURN OF INCOME ALREADY FILED M AY BE TREATED AS INCOME IN RESPONSE TO THE NOTICE. THE ASSESSMENT WAS RE-OP ENED ON RECORDING THE FOLLOWING REASONS; AS THE FDRS AMOUNTING TO RS.16,00,000/- PLUS CASH DEPOSIT OF RS.5000/- PLUS INTEREST OF RS.1,993/- WERE MADE, DU RING THE PERIOD RELEVANT TO AY 2007-08 AND THE ACCOUNT OF CORPORATI ON BANK HAS NOT BEEN DISCLOSED IN THE BALANCE SHEET AS ON 31.03.200 7, I HAVE REASON TO BELIEVE THAT THE ASSESSEE HAS FILED INCORRECT INFOR MATION AND THE INCOME HAS ESCAPE ASSESSMENT TO THE EXTENT AS THE SOURCE O F INVESTMENT IN FDRS AND CASH DEPOSIT MADE INTO THE BANK IS UNDISC LOSED. THE ASSESSEE OBJECTED TO THE REOPENING AND CONTENDE D THAT THE INCOME HAS ALREADY OFFERED, ACCEPTED AND TAXED IN AY 2008-09. THE CONTENTION OF THE ASSESSEE WAS NOT ACCEPTED BY AO, HOLDING THAT THE A SSESSEE WAS IN SETTLEMENT FOR AY 2008-09 AND 2009-10. THE ASSESSME NT FOR AY 2007-08 WAS NEVER REFERRED BEFORE SETTLEMENT COMMISSION. AFTER REJECTING THE SUBMISSION OF THE ASSESSEE, THE ASSESSING OFFICER ( AO) COMPLETED THE ASSESSMENT U/S 143 R.W.S. 147 ON 21.03.2014. THE AO WHILE PASSING THE ASSESSMENT ORDER MADE THE ADDITION OF RS. 16,06,993 /- IN THE TOTAL INCOME OF ASSESSEE. ON APPEAL BEFORE THE LD. CIT(A), THE ACTI ON OF AO WAS CONFIRMED. THUS, FURTHER AGGRIEVED BY THE ORDER OF LD. CIT(A), THE ASSESSEE FILED THE PRESENT APPEAL BEFORE US RAISING THE FOLLOWING GROU NDS OF APPEAL: ITA NO.1424/M/2016 S HRI SHIVKUMAR C. ACHARYA 3 1. THE LEARNED CIT (APPEALS) ERRED IN NOT DELETING THE ADDITION OF RS.16,06,993/-MADE BY THE ASSESSING OFFICER ALLEGED LY BEING BANK DEPOSITS MADE IN THE YEAR AND NOT DISCLOSED TO THE DEPARTMENT. 2. THE LEARNED CIT (APPEALS) FAILED TO APPRECIATE T HAT OUT OF THE SAID AMOUNT, AN AMOUNT OF RS.13,30,682/- HAD BEEN DULY E XPLAINED BEFORE SETTLEMENT COMMISSION AND NOTED BY THE COMMISSION I N PARA 3 OF ITS ORDER FOR A.Y.2008-09 AND 2009-10. 3. THE LEARNED CIT (APPEALS) FAILED TO APPRECIATE T HAT WITH REGARD TO THE BALANCE AMOUNT OF RS.3,01,993/-, IT REPRESENTS DEPO SIT OF RS.3,00,000/- MADE ON 18-01-2007 AND ALREADY TAXED IN A.Y.2008-09 TOGETHER WITH INTEREST ON MATURITY AND IF AGAIN TAXED IN A.Y.2007 -08 WOULD SUFFER DOUBLE TAXATION. 4. IT IS PRAYED THAT THE ADDITION OF RS.16,06,993/- MAY PLEASE BE DELETED. 3. NONE APPEARED ON BEHALF OF ASSESSEE WHEN THE APPEAL CAME UP HEARING DESPITE REPEATED CALLS. WE LEFT NO OPTION EXCEPT TO HEAR THE LD DR FOR THE REVENUE AND TO PROCEED ON THE BASIS OF THE MATERIAL AVAILABLE ON RECORD. THE LD. DR FOR THE REVENUE SUPPORTED THE ORDER OF AUTHO RITY BELOW. THE LD DR FOR THE REVENUE ARGUED THAT THE ASSESSEE NOT DISCLO SED THE DETAILS OF THE FDS IN THE BALANCE SHEET FOR AY 2007-08, THUS THE ASSESSMENT FOR THE YEAR UNDER CONSIDERATION WAS REOPENED AND WAS BROUGHT TO TAX. 4. WE HAVE CONSIDERED THE SUBMISSIONS OF THE LD DR FOR THE REVENUE AND PERUSED THE MATERIAL ON RECORD. THE CONTENTION OF T HE ASSESSEE THROUGHOUT THE RE-ASSESSMENT AS WELL AS BEFORE THE FIRST APPEL LATE AUTHORITY IS THAT THE INCOME OF BANK DEPOSITED HAS ALREADY BEEN OFFERED A ND HAVE BEEN TAXED IN AY 2008-08 AND 2009-10. WE HAVE NOTED THAT THE AO I N PARA 3 OF HIS ORDER HAS REFERRED PARA 9 OF THE ORDER OF SETTLEMENT COMM ISSION, WHEREIN IT IS SPECIFICALLY MENTIONED, THUS, THE ENTIRE POSITION IN RESPECT OF ADDITIONAL INCOME OFFERED BY THE APPLICANT, ARISING OUT OF THE UNDISCLOSED SAVING ITA NO.1424/M/2016 S HRI SHIVKUMAR C. ACHARYA 4 BANK ACCOUNT AND FDS AND THE INTEREST THEREON WITH THE CORPORATION BANK, MUMBAI, STANDS FULLY EXPLAINED. THUS ABOVE I SSUE GETS SETTLED . 5. THE AO AS WELL AS THE LD. CIT (A) INSTEAD OF VERIFY ING THE FACTS THAT THE ASSESSEE HAS OFFERED THE INCOME RELATED WITH BANK A CCOUNT AND THE FDS,IN AY 2008-09 AND AY 2009-10, HAVE TAXED THE SAME IN AY 2007-08. IN OUR VIEW THE AO IS DEFYING THE ORDER OF SETTLEMENT COMM ISSION WHICH IS AGAINST THE PROPRIETY OF HIERARCHY OF VARIOUS AUTHORITIES U NDER THE ACT. IT IS SETTLED LAW THAT UNDER THE INCOME-TAX ACT THE SAME INCOME C ANNOT BE TAXED TWICE. HENCE, THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE ACCEPTED. THE AO IS DIRECTED TO VERIFY THE FACTS, ONLY IF THE INCOM E BROUGHT TO TAX BY AO IN HIS ORDER UNDER SECTION 143(3) RWS 147 DATED 21.03.2014 HAS BEEN OFFERED BY ASSESSEE BEFORE SETTLEMENT COMMISSION OR NOT AND TH E ASSESSEE IN CASE THE ASSESSEE HAS ALREADY PAID THE TAX ON SUCH ADDITIONA L INCOME, DELETE THE ENTIRE ADDITION ACCORDINGLY. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH DAY OF OCTOBER 2017. SD/- SD/- (P.K. BANSAL) (PAWAN SINGH) (VICE-PRESIDENT) JUDICIAL MEMBER MUMBAI; DATED 11/10/2017 S.K.PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT ITA NO.1424/M/2016 S HRI SHIVKUMAR C. ACHARYA 5 BY ORDER, (ASSTT.REGISTRAR) ITAT, MUMBAI 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY/