SHEHABIAH TRADINGT & INVESTMENT CO. P. LTD, MUMBAI V. ITO 5(3)(4), MUMBAI

ITA 1480/MUM/2010

• Counselvise Citation: 148019914 RSA 2010
• Duration Of Justice: 3 year(s) 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-01-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: E
• Next Hearing Date: 06-01-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 24-02-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ASHOK SURI
• Assessee Lawyers: B V JHAVERI
• Keywords: Additional evidence
• Section: 68; 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUM BAI . . , , BEFORE SHRI R. C. SHARMA, AM AND SHRI VIVEK VARMA, JM ./ I.T.A. NOS. 5274/MUM/2009 & 1480/MUM/2010 ( / ASSESSMENT YEARS: 2005-06 & 2006-07) SHEHABIAH TRADING & INVESTMENT CO. PVT. LTD. 106, CHURCHGATE CHAMBERS, 5 NEW MARINE LINES, MUMBAI-400 020 / VS. INCOME TAX OFFICER 5(3)(4), MUMBAI ./ ! ./PAN/GIR NO. AAFCS 8647 D ( ' /APPELLANT ) : ( #$' / RESPONDENT ) ' % & / APPELLANT BY : SHRI B. V. JHAVERI #$' % & / RESPONDENT BY : SHRI ASHOK SURI ' ( % ) * / DATE OF HEARING : 06.01.2014 +,-. % ) * / DATE OF PRONOUNCEMENT : 10.01.2014 / O R D E R PER R. C. SHARMA, A. M.: THESE ARE THE APPEALS FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD. CIT(A)-V, MUMBAI FOR THE ASSESSMENT YEARS (A.Y.) 2005-06 AND 2006-07, IN THE MATTER OF ORDER PASSED BY THE ASSESSING OFFICER (A.O.) U/S.143(3) O F THE INCOME TAX ACT, 1961. 2. IN THE A.YS. 2005-06 AND 2006-07 BOTH, THE ASSES SEE IS AGREED FOR ADDITION MADE U/S.68. THE ASSESSEE IS ALSO AGREED FOR ADDITION OF RS.1,13,300/- ON ACCOUNT OF TDS NON- DEDUCTION IN THE A.Y. 2006-07. 2 ITA NOS. 5274/M/09 & 1480/M/10 (A.YS. 05-06 & 06-07) SHEHABIAH TRADING & INVESTMENT CO. PVT. LTD. VS. IT O 3. RIVAL CONTENTIONS HAVING HEARD AND PERUSED THE M ATERIAL PLACED ON RECORD. FACTS IN BRIEF ARE THAT THE ASSESSEE IS ENGAGED IN THE BUSIN ESS OF CONSTRUCTION. DURING THE A.Y. 2005-06 THE ASSESSEE CLAIMS TO HAVE RECEIVED RS.27, 14,477/- AS ADVANCES FROM FOURTEEN PERSONS AGAINST BOOKING OF FLATS IN DIFFERENT PROJE CTS OF CONSTRUCTION OF FLATS UNDERTAKEN BY THE ASSESSEE. IN THE ASSESSMENT PROCEEDINGS, THE ASSESSEE FAILED TO FILE CONFIRMATION OF MRS. VIJAYA HULE AND FURTHER THE ASSESSEE FAILED TO PRODUCE MRS. ARUNA DATIR AND MRS. ROHINI MALVADKAR BEFORE THE A.O. THESE TWO PERSONS HAVE ALSO NOT FILED ANY REPLY IN RESPONSE TO LETTERS ISSUED BY THE A.O. UNDER SECTIO N 133(6) OF THE INCOME TAX ACT. ON THESE FACTS THE A.O. HELD THAT THE ASSESSEE HAS NOT BEEN ABLE TO EXPLAIN THE CREDITS BY WAY OF ADVANCES RECEIVED IN THE NAME OF THREE PERSONS A ND TREATED THE SAME AS INCOME OF THE ASSESSEE BY INVOKING THE PROVISIONS OF SECTION 68 O F THE INCOME TAX ACT: DATIR RS.26,845/- MRS. VIJAYA HULE RS.36,000/- ROHINI MALVADKAR RS.2,00,000/- TOTAL RS.2,62,845/- IN THE CASE OF MR. ZUZER KANCHWALA TWO ADDITIONS W ERE MADE BY THE A.O. VIZ., OF RS.1,55,000/- AND RS.2,40,000/-. THE COMMISSIONER ( APPEALS) HAS DELETED THE ADDITION OF RS.1,55,000/- BUT HE HAS CONFIRMED THE ADDITION OF RS.2,40,000/-. IN THE A.Y. 2006-07 SIMILAR ADDITIONS WERE MADE BY THE A.O. IN THE APPE LLATE PROCEEDINGS, THE ASSESSEE SUBMITTED THAT A.O. HAS NOT GIVEN ENOUGH TIME TO PR ODUCE THE PERSONS FROM WHOM IT RECEIVED ADVANCES AGAINST THE BOOKING OF FLATS. THE ASSESSEE SUBMITTED THAT IT FILED DETAILS OF CONFIRMATION BEFORE THE A.O. IN THE MONTH OF JUL Y, 2007 AND ONLY ON 07.12.2007 THE A.O. ASKED THE ASSESSEE TO PRODUCE THE PARTIES ON 1 4.12.2007 AND, THEREFORE, NO PROPER OPPORTUNITY WAS GIVEN. FURTHER, THE ASSESSEE SUBMIT TED THAT THE A.O. HAS NOT BROUGHT TO ITS KNOWLEDGE THAT CONFIRMATION OF MRS. VIJAYA HULE IS NOT ON RECORD. THE ASSESSEE SUBMITTED THAT ALL THESE PERSONS ARE AT PUNE AND, T HEREFORE, IT WAS NOT POSSIBLE TO PRODUCE THEM DURING SUCH A SHORT PERIOD. 3 ITA NOS. 5274/M/09 & 1480/M/10 (A.YS. 05-06 & 06-07) SHEHABIAH TRADING & INVESTMENT CO. PVT. LTD. VS. IT O 4. BEING NOT IMPRESSED BY THE CONTENTION OF THE LD. AR, THE LD. CIT(A) CONFIRMED THE ADDITION AND THE ASSESSEE IS IN FURTHER APPEAL BEFO RE US. 5. THE LD. AR HAS APPLIED FOR FILING THE ADDITIONAL EVIDENCE BEFORE THE TRIBUNAL IN THE FORM OF ACCOUNTS OF MRS. ARUNA VIJAY DATIR AND MRS. SUJATA HULE IN THE BOOKS OF THE ASSESSEE COMPANY FOR THE A.YS. 2005-06 TO 2009-10 A ND THE COPIES OF THE LEDGER ACCOUNTS OF MR. JUZER KANCHWALA AND MRS. RANJANA MADAN MALJI IN THE BOOKS FOR THE YEARS ENDED 31.03.2005 AND 31.03.2006. 6. SIMILARLY FOR THE A.Y. 2006-07, THE LD. AR HAS F ILED FOLLOWING DOCUMENTS AS ADDITIONAL EVIDENCES: 1) AFFIDAVIT OF SMT. N. Z. POONAWALA SWORN ON 13.04 .2011. 2) RETURNS OF INCOME OF SMT. NAFISA ZOHAR POONAWALA FOR A.YS. 1998-99 TO 2003-04 AND A.YS. 2007-08 TO 2009-10. 3) LEDGER ACCOUNT OF MR. NAEEM KHAN FOR THE PERIOD FROM 01.04.2009 TO 31.03.2010. 4) AFFIDAVIT OF MR. NAEEM KHAN DATED 5 TH FEBRUARY, 2011. 5) RENT RECEIPT IN RESPECT OF RESIDENTIAL FLAT AT N ANA PETH, PUNE IN THE NAME OF MR. NAEEM R. KHAN. 6) ACKNOWLEDGEMENTS OF THE RETURNS OF INCOME OF THE ASSESSEE COMPANY FOR A.YS. 2000-01 TO 2002-03. IT WAS ARGUED BY THE LD. AR THAT ALL THESE DOCUMENT S GOES TO THE ROOT OF THE ISSUE AND NECESSARY FOR THE DISPOSAL OF THE AFORESAID APP EALS. 7. ON THE OTHER HAND, THE LD. DR RELIED ON THE ORDE RS OF THE LOWER AUTHORITIES. 8. WE HAVE CONSIDERED THE RIVAL CONTENTIONS CAREFUL LY AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND FOUND FROM THE RECORD THA T THE ASSESSEE COMPANY IS ENGAGED IN THE BUSINESS OF CIVIL CONSTRUCTION. THE A.O. HAS AD DED TO THE INCOME OF THE ASSESSEE THE ADVANCES OF RS.2,62,845/- RECEIVED AGAINST BOOKING OF FLATS FROM THE FOLLOWING PERSONS: 4 ITA NOS. 5274/M/09 & 1480/M/10 (A.YS. 05-06 & 06-07) SHEHABIAH TRADING & INVESTMENT CO. PVT. LTD. VS. IT O DATIR RS.26,845/- MRS. VIJAYA HULE RS.36,000/- ROHINI MALVADKAR RS.2,00,000/- TOTAL RS.2,62,845/- THE ASSESSEE REPRESENTATIVE VIDE THEIR LETTER DATE D 16.07.2007 HAD SUBMITTED THE DETAILS REGARDING ADVANCES RECEIVED AGAINST BOOKING OF FLATS WITH CONFIRMATION LETTER/AGREEMENTS. XEROX OF THE LETTER DATED 16.07. 2007 WITH CONFIRMATION OF DATIR AND ROHINI MALVADKAR FILED DURING THE COURSE OF ASSESSM ENT PROCEEDINGS WAS ALSO ENCLOSED AT PAGES 22 TO 27. THE ASSESSEE HAS ALSO FILED COPY OF THE BANK STATEMENTS WHEREIN THE RECEIPTS FROM ALL THE AFORESAID PERSONS WERE REFLEC TED. THE CONFIRMATION LETTER WAS ALSO FILED ON 16.07.2007. HOWEVER, THE A.O. DID NOT ACCE PT THE FORMAT IN WHICH THE CONFIRMATION LETTERS WERE FILED. BEING NOT SATISFIE D WITH THE ASSESSEES CONTENTION, THE A.O. ADDED THE ENTIRE AMOUNT U/S.68. FROM THE RECOR D, WE FIND THAT THE ASSESSEE HAD RECEIVED THE AMOUNT FOR BOOKING OF THE FLATS AND NO T AS A LOAN. BY FILING THE CONFIRMATION LETTER CONFIRMING THAT THESE PARTIES HAVE PAID THE AMOUNT FOR BOOKING OF FLATS/AGREEMENT THE ASSESSEE HAS TRIED TO DISCHARGE THE INITIAL BUR DEN OF PROVING THE GENUINENESS OF THE TRANSACTION. BY PLACING THE ADDITIONAL EVIDENCE AS DISCUSSED ABOVE, THE LD. AR HAS TRIED TO DEMONSTRATE THAT THESE RECEIPTS HAVE BEEN ACCOUNTED FOR AS INCOME IN THE SUBSEQUENT YEARS. AS PER OUR CONSIDERED VIEW, ALL THESE EVIDEN CE GOES TO THE ROOT OF THE ISSUE WHICH IS REQUIRED TO BE CONSIDERED BEFORE MAKING ANY ADDI TION. IN THE INTEREST OF JUSTICE AND FAIR- PLAY, WE RESTORE ALL THESE ADDITIONAL EVIDENCES TO THE FILE OF THE A.O. FOR EXAMINING THE SAME AND DECIDE THE ISSUE AFRESH. NEEDLESS TO SAY T HAT THE ASSESSEE SHOULD BE GIVEN DUE OPPORTUNITY BEFORE DECIDING THE ISSUE. THE ASSESSEE IS AT A LIBERTY TO FILE ANY OTHER EVIDENCE AS REQUIRED BY THE A.O. OR WHICH IS RELEVA NT FOR DECIDING THE ISSUE UNDER CONSIDERATION. WE DIRECT ACCORDINGLY. THE ASSESSEE HAS DEBITED EXPENSES OF RS.22,07,600/- PERTAINING TO M/S. SHAILESH CONSTRUCTION COMPANY. HOWEVER, THE A.O. FOUND THAT AS PER TDS CERTIFICATE, THE ASSESSEE HAS DEDUCTED TDS ON EXPENSES OF RS.22,94,3 00/-. THE A.O. INVOKED THE 5 ITA NOS. 5274/M/09 & 1480/M/10 (A.YS. 05-06 & 06-07) SHEHABIAH TRADING & INVESTMENT CO. PVT. LTD. VS. IT O PROVISIONS OF SECTION 40(A)(IA) OF THE INCOME TAX A CT AND DISALLOWED THE AMOUNT OF RS.1,13,300/-. AS PER THE PROVISIONS OF SECTION 40( A)(IA) THE CLAIM FOR EXPENSES, ON WHICH TDS IS REQUIRED TO BE DEDUCTED, ARE NOT TO BE ALLOW ED AS DEDUCTION IF EITHER TDS IS NOT DEDUCTED OR AFTER DEDUCTION THE SAME IS NOT DEPOSIT ED WITHIN THE DUE DATE. SINCE THE ASSESSEE HAS NOT DEDUCTED TDS OUT OF EXPENSE OF RS. 1,13,000/-, THE A.O. WAS JUSTIFIED IN DISALLOWING THE SAME. WE CONFIRM THE ACTION OF THE A.O. IN THIS REGARD AND DISMISS GROUND NO. 2 OF ASSESSEES APPEAL IN A.Y. 2006-07. 9. IN THE RESULT, THE ASSESSEES APPEALS FOR BOTH T HE YEARS ARE ALLOWED IN PART, IN TERMS INDICATED HEREINABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON JANUARY 10, 2 014 SD/- SD/- (VIVEK VARMA) (R. C. SHARMA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER ' / MUMBAI; 0( DATED : 10.01.2014 .(../ ROSHANI , SR. PS ! ' #$%& ' &$ / COPY OF THE ORDER FORWARDED TO : 1. ' / THE APPELLANT 2. #$' / THE RESPONDENT 3. ' 1) ( ) / THE CIT(A) 4. ' 1) / CIT - CONCERNED 5. 4 5 #)(67 , * 67. , ' / / DR, ITAT, MUMBAI 6. 5 8 9 / GUARD FILE ! ( / BY ORDER, )/(* + (DY./ASSTT. REGISTRAR) , ' / / ITAT, MUMBAI