Shri Mohamed Ibrahim Bloch, Vadodara V. ITO, Ward 3(1) (1), Vadodara

ITA 1625/AHD/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 9033 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-07-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 03-07-2019
• Assessment Year: 2012-2013
• Appeal Filed On: 30-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: DEEPALI SHAH
• Keywords: Opportunity of being heard; Corroborative evidences
• Section: 143(3); 143(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER & MS. MADHUMITA ROY, JUDICIAL MEMBER ITA NO. 1625/AHD/2017 (ASSESSMENT YEAR : 2012-13) SHRI MOHAMED IBRAHIM BLOCH, 3-A, SHIVNERI SOCIETY , OPP. KOTYARKNAGAR, WADI, SHASTRIBUAG, VADODARA 390 017. VS. INCOME TAX OFFICER, WARD 3(1)(1), VADODARA. [PAN NO. ABZPB 6326 L] ( APPELLANT ) .. ( RESPONDENT ) APPELLANT BY : MS. DEEPALI SHAH, A.R. RESPONDENT BY : SHRI MUDIT NAGPAL, SR. D.R. DATE OF HEARING 03/07/2019 DATE OF PRONOUNCEMENT 09/07/2019 O R D E R PER MS. MADHUMITA ROY - JM: THE INSTANT APPEAL FILED BY THE ASSESSEE IS DIRECTE D AGAINST THE ORDER DATED 22.03.2017 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS)-3, VADODARA ARISING OUT OF THE ORDER DATED 26.03.2015 PASSED BY THE ITO , WARD 3(1)(1), VADODARA UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 (H EREINAFTER REFERRED AS TO THE ACT) FOR THE ASSESSMENT YEAR 2012-13. 2. THE ASSESSEE, AN INDIVIDUAL FILED ITS RETURN OF INCOME THROUGH ELECTRONIC MEDIA ON 15.09.2012 TOTAL INCOME AT RS.10,06,130/- WHICH WAS PROCESSED U/S 143(1) OF THE ACT. - 2 - ITA NO.1625/AHD/2017 SHRI MOHAMED IBRAHIM BLOCH VS. ITO ASST.YEAR 2012-13 UNDER SCRUTINY NOTICE U/S 143(2) DATED 06.08.2013 W AS SERVED UPON THE ASSESSEE. THE ASSESSEE IS A CINE PRODUCER & DIRECTOR AND ENGAGED IN THE BUSINESS OF THEATER MANAGEMENT AND CONSULTANCY. DURING THE YEAR UNDER C ONSIDERATION IT WAS FOUND BY THE LEARNED AO THAT THE ASSESSEE HAS WRITTEN OFF TWO LI ABILITIES IN THE MANNER AS FOLLOWS: 1. WHITE CITY ENTERTAINMENT PVT. LTD. - RS.1,07,3 6,000/- 2. ANIL SAMANI - RS.2,13,80,762/- THE ASSESSEE HAS FURTHER CLAIMED AGAINST THE ABOVE CREDIT WRITTEN OFF OF RS.3,21,16,762/- CERTAIN COST OF PRODUCTION. THE DE TAILS OF COST OF PRODUCTION CLAIMED AGAINST THE ABOVE CREDIT WRITTEN OFF ARE AS FOLLOWS: 1. COST OF PRODUCTION (KKABHH FILM) RS.70,16,806/- 2. COST OF PRODUCTION (ISHQ DEEWANA FILM) RS.1,35,81, 190/- TOTAL RS.2,05,97,996/- ACCORDINGLY, THE ASSESSEE HAS CREDITED INCOME OF RS .1,15,18,796/- WHICH HAS BEEN EMBEDDED INTO THE SUNDRY BALANCE WRITTEN OFF OF R S.1,07,36,000/- SHOWN AS INCOME OF MEHUL KUMAR. THE ASSESSEE HAS CLAIMED WRITE OFF OF SUCH COST OF PRODUCTION OF TWO FILMS NAMELY KKABHH AND ISHQ DEEWANA. IN TERMS OF THE LETTER DATED 23.01.2015 ISSUED BY THE LEARNED AO CERTAIN DOCUMENTS INCLUDING LEDGER O F COST OF PRODUCTION WERE SUBMITTED BY THE ASSESSEE. HOWEVER, THE ASSESSEE FAILED TO SU BMIT SUPPORTING EVIDENCES WITH REFERENCE TO SUCH COST OF PRODUCTION OF THESE TWO F ILMS AND ULTIMATELY SHOW-CAUSE WAS ISSUED TO THE ASSESSEE AS TO WHY RS.2,05,97,998/- S HOULD NOT BE DISALLOWED. THE REPLY RENDERED BY THE ASSESSEE WAS NOT FOUND SUITABLE AND FINALLY THE ASSESSMENT WAS COMPLETED UPON MAKING AN ADDITION OF RS.2,05,97,996 /- TOWARDS DISALLOWANCE OF SUNDRY DEBTORS WRITTEN OFF AND RS.2,37,739/- TOWARDS DISAL LOWANCE OF EXPENSES. THE CLAIM OF WRITE OFF EXPENSES WAS DISALLOWED ON THE GROUND THA T THE EXPENSES WERE RELATING TO DIFFERENT PROJECTS AND THE OTHER DISALLOWANCE WAS M ADE ON THE GROUND THAT SUCH EXPENSES WERE NOT INCURRED ONLY AND EXCLUSIVELY FOR THE PURP OSE OF BUSINESS. BOTH THE DISALLOWANCES WERE CONFIRMED BY THE FIRST APPELLATE AUTHORITY IN APPEAL PREFERRED BY THE ASSESSEE. HENCE THE ASSESSEE BEFORE US. - 3 - ITA NO.1625/AHD/2017 SHRI MOHAMED IBRAHIM BLOCH VS. ITO ASST.YEAR 2012-13 3. AT THE TIME OF HEARING OF THE INSTANT APPEAL, TH E LEARNED COUNSEL APPEARING FOR THE ASSESSEE SUBMITTED BEFORE US THAT THE LEARNED AO HA S MADE SUCH DISALLOWANCES OF EXPENSE IN THE ABSENCE OF EVIDENCES RELATING TO THE EXPENSES INCURRED SINCE NOT PRODUCED BEFORE HIM. THE LEARNED AR ALSO MADE AN APPLICATION UNDER RULE 29 OF THE INCOME TAX (APPELLATE TRIBUNAL) RULES, 1963 FOR ADMITTING ADDI TIONAL EVIDENCES BEING THE DETAILS OF COST OF PRODUCTION AND BILLS AND OTHER EVIDENCES TO WARDS EXPENSES IN ORDER TO JUSTIFY ASSESSEES CLAIM BEFORE US. THE DOCUMENTS ARE ANNEX ED IN THE PAPER BOOK SO SUBMITTED BEFORE US BY THE LEARNED AR. IT WAS ALSO FURTHER SU BMITTED BY THE ASSESSEES COUNSEL THAT THOSE DOCUMENTS COULD NOT BE FILED BEFORE THE LEARN ED AO AS THE ASSESSEE WAS PASSING THROUGH A BAD FACE OF FINANCIAL CRISES; THE MOVIES WHICH THE ASSESSEE STARTED PRODUCING WERE PROLONGED AND WERE ULTIMATELY ABANDONED IN WHI CH THE ASSESSEE HAS INCURRED HUGE COST. THE ASSESSEE WAS ALSO REMAINED INVOLVED IN HA NDLING FINANCE AND REPAYMENT OF LOANS WHICH WERE BORROWED FOR MAKING THESE FILMS. I N THAT VIEW OF THE MATTER, SHE SUBMITTED BEFORE US THAT THE MATTER BE REMITTED TO THE FILE OF THE LEARNED AO FOR ADJUDICATION OF THE SAME ON THE BASIS OF THE ADDITI ONAL EVIDENCES SO SUBMITTED BEFORE US. THE LEARNED DR, HOWEVER, HAS NOT RAISED ANY OBJECTI ON TO SUCH CONTENTION MADE BY THE LEARNED AR. 4. HEARD THE RESPECTIVE PARTIES, PERUSED THE RELEVA NT MATERIALS AVAILABLE ON RECORD. IT APPEARS THAT THE EXPLANATION RENDERED BY THE ASSESS EE FOR NOT PRODUCING THOSE DOCUMENTS BEFORE THE AUTHORITIES BELOW SEEMS TO BE GENUINE AN D THEREFORE, WE ARE OF THE CONSIDERED OPINION THAT IN ORDER TO PREVENT THE MISCARRIAGE OF JUSTICE, ANOTHER OPPORTUNITY OF HEARING BE GIVEN TO THE ASSESSEE TO REPRESENT HIS CASE EFFE CTIVELY BEFORE THE AUTHORITIES BELOW. IN THAT VIEW OF THE MATTER, WE RESTORE THE ISSUE TO TH E FILE OF THE LEARNED AO WITH THE FURTHER DIRECTION UPON HIM TO CONSIDER THE MATTER AFRESH UP ON GIVING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND UPON CONSIDERING ADDITION AL EVIDENCES TO BE SUBMITTED BEFORE - 4 - ITA NO.1625/AHD/2017 SHRI MOHAMED IBRAHIM BLOCH VS. ITO ASST.YEAR 2012-13 HIM AND TO PASS ORDERS IN ACCORDANCE WITH LAW. HENC E, ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 5. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. THIS ORDER PRONOUNCED IN OPEN COURT ON 09/07/2019 SD/- SD/- ( WASEEM AHMED ) ( MS. MADHUMITA ROY ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 09/07/2019 PRITI YADAV, SR.PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. () / THE CIT(A)-3, VADODARA. 5. , ! ' , #$%% / DR, ITAT, AHMEDABAD 6. &' () / GUARD FILE. / BY ORDER, //TRUE COPY// / ( DY./ASSTT.REGISTRAR) !, #$ / ITAT, AHMEDABAD 1. DATE OF DICTATION 03.07.2019 (DICTATION PAGES 4) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 04/07/2019 3. OTHER MEMBER. 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S 08/07/2019 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S. 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER