LAXMINARAYAN AGARWAL, MUMBAI V. ACIT, CIRCLE 4 , THANE

ITA 1475/MUM/2020

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 2486 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 4 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-07-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 10-03-2020
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SMITA NAIR
• Assessee Lawyers: MAYURI KULKARNI
• Keywords: Loose papers
• Section: 6

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “SMC” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND SHRI SANDEEP SINGH KARHAIL (JUDICIAL MEMBER) ITA No. 1475/MUM/2020 Assessment Year: 2009-10 Shri Laxminarayan Agarwal, 9, Gokul Annexe, Agarwal Gardens Phase II, Gokul Township, Bolinj, Virar West, Palghar-401303. Vs. ACIT Circle-4, Room No. 2, A Wing, Ashar IT Park, Wagle Indl. Estate, Ambika Nagar, Thane-400604. PAN No. ADLPA 8414 E Appellant Respondent Assessee by : Ms. Mayuri Kulkarni, AR Revenue by : Mrs. Smita Nair, DR Date of Hearing : 22/06/2022 Date of pronouncement : 27/07/2022 ORDER PER OM PRAKASH KANT, AM This appeal by the assessee is directed against order dated 10.01.2020 passed by the Ld. Commissioner of Income-tax (Appeals)-3, Thane [in short ‘the Ld. CIT(A)’] for assessment year 2009-10, raising following ground: 1. The learned CIT(A) erred in upholding the validity of reassessment when the assessment framed by the learned Assessing Officer diametrically opposite from the reasons recorded for reopening the assessment. 2. The learned CIT(A) erred in disregarding the grave mistake committed by the Assessing O ₹25,06,000/ received from sale of FSI to the builder when in fact the reason recorded for reopening stated that the appellant had paid cash the builder for purchase of the property. The learned CIT(A) failed to appreciate that the reassessment is void a 3. The learned CIT(A) erred in inferring that reasons recorded and assessment framed are congruous despite admitting that there infirmity in the reasons recorded. The learned CIT(A) failed to appreciate that the infirmity is so material which of the reassessment and is fatal invalidating 4. The learned CIT(A) erred in not following the decision of the jurisdictional High Court which has held that if no addition is made in respect of issue which formed the basis for other addition is permissible. 5. The learned CIT(A) erred in concluding that the common in the recorded reasons and assessment framed is cash element involved in the transaction and exactly what was pe CIT(A) failed to appreciate that if foundation of reassessment, the entire 6. The learned CIT(A) erred in upholding the stand of the Officer in completely statement of the partner of the searched Shri Laxminarayan The learned CIT(A) erred in upholding the validity of reassessment when the assessment framed by the learned Assessing Officer diametrically opposite from the reasons recorded for reopening the assessment. The learned CIT(A) erred in disregarding the grave mistake committed by the Assessing Officer in making addition of 25,06,000/- to the income of the appellant on account o received from sale of FSI to the builder when in fact the reason recorded for reopening stated that the appellant had paid cash the builder for purchase of the property. The learned CIT(A) failed to appreciate that the reassessment is void a The learned CIT(A) erred in inferring that reasons recorded and assessment framed are congruous despite admitting that there infirmity in the reasons recorded. The learned CIT(A) failed to appreciate that the infirmity is so material which of the reassessment and is fatal invalidating the assessment. The learned CIT(A) erred in not following the decision of the jurisdictional High Court which has held that if no addition is made in respect of issue which formed the basis for other addition is permissible. The learned CIT(A) erred in concluding that the common in the recorded reasons and assessment framed is cash element involved in the transaction and hence the addition is exactly what was perceived in the recorded reasons. The learned CIT(A) failed to appreciate that if wrong facts forms the foundation of reassessment, the entire assessment collapses. The learned CIT(A) erred in upholding the stand of the Officer in completely relying on the inferential evidence such as statement of the partner of the searched party. Shri Laxminarayan Agarwal ITA No. 1475/M/2020 2 The learned CIT(A) erred in upholding the validity of reassessment when the assessment framed by the learned Assessing Officer was diametrically opposite from the reasons recorded for reopening The learned CIT(A) erred in disregarding the grave mistake fficer in making addition of to the income of the appellant on account of cash received from sale of FSI to the builder when in fact the reason recorded for reopening stated that the appellant had paid cash to the builder for purchase of the property. The learned CIT(A) thus failed to appreciate that the reassessment is void ab initio. The learned CIT(A) erred in inferring that reasons recorded and assessment framed are congruous despite admitting that there is infirmity in the reasons recorded. The learned CIT(A) failed to appreciate that the infirmity is so material which goes to the root assessment. The learned CIT(A) erred in not following the decision of the jurisdictional High Court which has held that if no addition is made in respect of issue which formed the basis for reopening, no The learned CIT(A) erred in concluding that the common element in the recorded reasons and assessment framed is unaccounted hence the addition is recorded reasons. The learned wrong facts forms the assessment collapses. The learned CIT(A) erred in upholding the stand of the Assessing evidence such as 7. The learned CIT(A) erred in concluding that the loose papers found during the search operations in case of third party are sufficient to establish the nexus with th 8. The learned CIT(A) failed to appreciate that apart from the statement and material found during the search of the the Assessing Officer could not adduce any cogent evidence in support of his contention that the received cash in the transaction. 9. The learned CIT(A) erred in brushing aside the appellant's contention that he was not afforded the opportunity to cross examine the deponent on the basis of whose statement the addition was made. 2. At the outset, the Ld. Counsel of the assessee submitted that assessee has opted for Vivad Se Vishwas Scheme, 2020 and settled its dispute and paid the taxes due under the said scheme therefore, the assessee wishes to withdraw the captioned appeal The Ld. Counsel has also filed Form Nos. 3, 4 & 5 prescribed under the Vivad Se Vishwas Act, 2020. The relevant part reproduced as under: “Now, therefore, in exercise of the powers conferred by sub (2) of section S read with section 6 of the that - Shri Laxminarayan The learned CIT(A) erred in concluding that the loose papers found during the search operations in case of third party are sufficient to establish the nexus with the appellant. The learned CIT(A) failed to appreciate that apart from the statement and material found during the search of the the Assessing Officer could not adduce any cogent evidence in support of his contention that the appell received cash in the transaction. The learned CIT(A) erred in brushing aside the appellant's contention that he was not afforded the opportunity to cross examine the deponent on the basis of whose statement the addition was made. outset, the Ld. Counsel of the assessee submitted that assessee has opted for Vivad Se Vishwas Scheme, 2020 and settled its dispute and paid the taxes due under the said scheme therefore, the assessee wishes to withdraw the captioned appeal unsel has also filed Form Nos. 3, 4 & 5 prescribed under the Vivad Se Vishwas Act, 2020. The relevant part of reproduced as under: Now, therefore, in exercise of the powers conferred by sub (2) of section S read with section 6 of the Act, it is hereby certified Shri Laxminarayan Agarwal ITA No. 1475/M/2020 3 The learned CIT(A) erred in concluding that the loose papers found during the search operations in case of third party are e appellant. The learned CIT(A) failed to appreciate that apart from the statement and material found during the search of the developer, the Assessing Officer could not adduce any cogent corroborative appellant had in fact The learned CIT(A) erred in brushing aside the appellant's contention that he was not afforded the opportunity to cross- examine the deponent on the basis of whose statement the outset, the Ld. Counsel of the assessee submitted that assessee has opted for Vivad Se Vishwas Scheme, 2020 and settled its dispute and paid the taxes due under the said scheme and therefore, the assessee wishes to withdraw the captioned appeal. unsel has also filed Form Nos. 3, 4 & 5 prescribed under of Form No. 5 is Now, therefore, in exercise of the powers conferred by sub-section Act, it is hereby certified (a) a sum of Rs. 25580 and final settlement of tax arrear determined in the order 110500070060121 dated 06/01/2021 and (b) the immunity is granted subject to the provisions Act, from instituting any proceeding for prosecution for under the Income said enactment[as per section 6 of the Act], arrear as detailed in the table b Sl No. Assessment Year/Financial Year 1. 2009-10 It is hereby clarified that making a declaration under this Act shall not amount to conceding the tax position and it shall not be lawful for the income or writ petition or special leave petition to contend that th or the income- decision on the disputed issue by settling the dispute. 3. In view of withdrawal of the appeal is dismissed as infructuous. Order pronounced in Sd/- (SANDEEP SINGH KARHAIL JUDICIAL MEMBER Shri Laxminarayan (a) a sum of Rs. 25580 has been paid by the declarant towards full and final settlement of tax arrear determined in the order 110500070060121 dated 06/01/2021 and (b) the immunity is granted subject to the provisions contained in the Act, from instituting any proceeding for prosecution for under the Income-tax Act or from the imposition of penalty under the said enactment[as per section 6 of the Act], in respect of the tax arrear as detailed in the table below: Details of dispute settled (Appeal reference number) Nature of arrear (disputed tax/disputed penalty/disputed interesest/disputed fee) 1 Disputed Tax clarified that making a declaration under this Act shall not amount to conceding the tax position and it shall not be lawful for the income-tax authority or the declarant being a party in appeal or writ petition or special leave petition to contend that th -tax authority, as the case may be, has acquiesced in the decision on the disputed issue by settling the dispute.” In view of withdrawal of the appeal by the assessee is dismissed as infructuous. ounced in the Court on 27/07/2022. Sd/- SANDEEP SINGH KARHAIL) (OM PRAKASH KANT JUDICIAL MEMBER ACCOUNTANT Shri Laxminarayan Agarwal ITA No. 1475/M/2020 4 has been paid by the declarant towards full and final settlement of tax arrear determined in the order No contained in the any offence tax Act or from the imposition of penalty under the in respect of the tax Nature of arrear penalty/disputed interesest/disputed Amount of tax arrear 1595730 clarified that making a declaration under this Act shall not amount to conceding the tax position and it shall not be lawful tax authority or the declarant being a party in appeal or writ petition or special leave petition to contend that the declarant tax authority, as the case may be, has acquiesced in the by the assessee, the same OM PRAKASH KANT) MEMBER Mumbai; Dated: 27/07/2022 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to 1. The Appellant 2. The Respondent. 3. The CIT(A)- 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. //True Copy// Shri Laxminarayan Copy of the Order forwarded to : BY ORDER, (Sr. Private Secretary ITAT, Mumbai Shri Laxminarayan Agarwal ITA No. 1475/M/2020 5 Sr. Private Secretary) ITAT, Mumbai