YELLAPPA CHITHANANDAPPA KURUBA, MUMBAI V. ITO 21(3)(2), MUMBAI

ITA 1599/MUM/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 79305 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-07-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: misc
• Appeal Filed On: 27-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUNIL AGARWAL
• Assessee Lawyers: ASHWIN S CHHAG
• Keywords: Unexplained cash credit; Opportunity of being heard
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH I, MUMBAI BEFORE N.K. BILLAIYA, ACCOUNTANT MEMBER AND DR. S.T.M. PAVALAN, JUDICIAL MEMBER ITA NO. 1599/MUM/2013 ASSESSMENT YEAR: 2007-08 SHRI YELLAPPA CHITHANANDAPPA KURUBA PROP. OF M/S. B. ENTERPRISES, B/4, TOWER NO.1, KURLA KAMGAR SOCIETY, KAMGAR NAGAR, KURLA (E), MUMBAI- 400 024 PAN: AGEPK 8433 D VS. ITO-21(3)(2), C-11 BLDG, 5 TH FLOOR, PRTAYKSA KAR BHAVAN, BKC, BANDRA (E) MUMBAI-51 (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI ASHWIN S. CHHAG REVENUE BY : SHRI SUNIL AGARWAL DATE OF HEARING : 01.07.2014 DATE OF PRONOUNCEMENT : 02.07.2014 O R D E R PER DR. STM PAVALAN, JM: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF THE LD.CIT(A)-32, MUMBAI DATED 16.01.2013 FOR THE ASSES SMENT YEAR 2007-08 . 2. IN THIS APPEAL, THE ASSESSEE HAS AGITATED THE DE CISION OF THE LD.CIT(A) CONFIRMING THE ADDITION MADE BY THE AO U/S 68 OF TH E INCOME TAX ACT. 3. THE RELEVANT FACTS ARE THAT DURING THE ASSESSMEN T PROCEEDINGS, THE AO NOTED THAT THE ASSESSE HAS RECEIVED LOANS TO THE EXTENT O F RS.4,98,000/- FROM HIS RELATIVES. THE ASSESSEE PRODUCED THE CONFIRMATION OF LOAN CRED ITORS ALONG WITH THEIR BANK STATEMENTS AND THE ACKNOWLEDGMENT OF THE RETURN AND ACCORDINGLY CONTENDED THAT THE LOANS WERE RECEIVED THROUGH CHEQUES. HOWEVER, T HE AO AFTER GOING THROUGH THE BANK ACCOUNT HAD NOTED THAT IN ALL THE CASES CASH W AS DEPOSITED ON 10 TH , 12 TH , AND 13 TH OF JUNE 2006 AND ALL THE LOAN CREDITORS IMMEDIATEL Y THEREAFTER ISSUED LOAN CHEQUES TO THE ASSESSE ON 13.06.2006. THE AO CONFRO NTED THE ASSESSE ON THIS AND ITA NO. 1599/MUM/2013 SHRI YELLAPPA CHITHANANDAPPA KURUBA ASSESSMENT YEAR: 2007-08 2 THE ASSESSEE REITERATED THAT THE LOANS HAD BEEN TAK EN BY CHEQUES AND ALL THE LOAN CREDITORS WERE FILING THEIR INCOME TAX RETURN HAVIN G INCOME FROM STITCHING CHARGES. THE AO, HOWEVER, AFTER OBSERVING THAT NONE OF THE L OAN CREDITORS WERE HAVING TAXABLE INCOME AS PER THE ACKNOWLEDGMENT OF RETURN, SINCE THE ASSESSEE DID NOT SUBMIT THE CAPITAL ACCOUNT OF THE LOAN CREDITORS TO PROVE THE AVAILABILITY OF THE CASH FOR BEING DEPOSITED IN THE BANK ACCOUNT, THE AO CON CLUDED THE ASSESSEE WAS NOT ABLE TO SATISFACTORILY DISCHARGE ONUS OF PROVING TH E SOURCE OF LOANS AND HENCE THE SAID LOANS WERE TREATED AS UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT. DURING THE FIRST APPELLATE PROCEEDINGS BEFORE THE LD.CIT(A), THE LD. CIT(A) CALLED FOR THE REPORT FROM THE AO AND IN RESPONSE THE AO SUBMITTED THE REPORT WHEREIN IT WAS STATED THAT DURING THE REMAND PROCEEDINGS THE ASSESSEE SUBMITTE D IN THE TAPAL ENCLOSING EXPLANATION WHICH WAS EARLIER SUBMITTED DURING THE FIRST APPELLATE PROCEEDINGS. HENCE THE AO STATED IN THE REMAND REPORT THAT THE A SSESSE WAS NOT ABLE TO EXPLAIN THE SOURCE OF CASH DEPOSIT IN THE SAID CREDITORS BA NK ACCOUNT JUST BEFORE ISSUE OF CHEQUES. AFTER CONSIDERING THE SAID REPORT, THE LD. CIT(A) CONFIRMED THE ADDITION MADE BY THE AO. AGGRIEVED BY THE IMPUGNED ORDER, TH E ASSESSEE IS IN APPEAL BEFORE US. 4. HAVING HEARD BOTH THE SIDES AND PERUSED THE MATE RIAL ON RECORD, IT IS PERTINENT TO MENTION THAT AMONG OTHER THINGS, IT IS THE CONTENTION OF THE LD. AR THAT THE ASSESSE WAS NOT GIVEN PROPER OPPORTUNITY IN THE REMAND PROCEEDINGS AND STATED THAT IF THE AO WAS IN FURTHER REQUIREMENT OF ANY DE TAILS REGARDING THE SAID LOANS, THE SAME WOULD HAVE BEEN FURNISHED BY THE ASSESSEE. HOW EVER, IT APPEARS THAT THE AO, IN THE REMAND PROCEEDINGS HAS NOT ASKED FOR ANY OTH ER DETAIL. THE ASSESSEE WAS ON THE IMPRESSION THAT THE DETAILS WHICH HAVE BEEN MAD E BEFORE THE AO DURING THE ASSESSMENT PROCEEDINGS AND FURTHER SUBMISSION OF TH E WRITTEN SUBMISSION MADE BEFORE THE LD.CIT(A) ARE SUFFICIENT IN THE REMAND P ROCEEDINGS. CONSIDERING THE ENTIRETY OF FACTS, WE ARE OF THE CONSIDERED OPINION THAT THE ASSESSEE HAS NOT BEEN GIVEN PROPER OPPORTUNITY OF BEING HEARD DURING THE REMAD PROCEEDINGS TO PRODUCE ALL THE DETAILS NECESSARY TO PROVE THE CLAIM OF THE ASSESSE. IN VIEW OF THAT MATTER, WE ARE OF THE CONSIDERED VIEW THAT IT IS JUST AND P ROPER TO SET ASIDE THE ENTIRE MATTER BACK TO THE FILE OF THE AO TO PASS FRESH ASSESSMENT ORDER AFTER GIVING DUE ITA NO. 1599/MUM/2013 SHRI YELLAPPA CHITHANANDAPPA KURUBA ASSESSMENT YEAR: 2007-08 3 OPPORTUNITY OF BEING HEARD TO THE ASSESSE TO SUBST ANTIATE HIS CLAIM. WE DIRECT AND ORDER ACCORDINGLY. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 2 ND DAY OF JULY, 2014. SD/- SD/- (N.K. BILLAIYA) (DR. S.T.M.PAVALAN) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 02.07.2014. *SRIVASTAVA COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR I BENCH //TRUE COPY// BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.