AKASH BHARAT MEHTA, MUMBAI V. ACIT-33(1), MUMBAI

ITA 1635/MUM/2023

AI Insights

The case involves Akash Bharat Mehta, the appellant, who challenged the order of the CIT(A) regarding various disallowances and additions made in the assessment year 2013-14. The main contention was the CIT(A)'s decision was made without a proper hearing or consideration of the appellant's submissions. The tribunal found that the CIT(A) had indeed transitioned to faceless proceedings but failed to adequately consider the appellant's submissions and adjournment request before passing the order. Consequently, the tribunal set aside the CIT(A)'s order and remanded the case for a fresh decision.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 113417 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-07-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: A
• Next Hearing Date: 23-07-2023
• Assessment Year: 2013-2014
• Appeal Filed On: 10-05-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Gift; Opportunity of being heard; Additional evidence
• Section: 68; 54; 56; 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL "A" BENCH, MUMBAI SHRI B.R. BASKARAN, ACCOUNTANT MEMBER SHRI RAHUL CHAUDHARY, JUDICIAL MEMBER ITA No. 1635/MUM/2023 (Assessment Year: 2013-14) Akash Bharat Mehta, A/2002, Oberoi Gardens, C.H.S. Ltd., Thakur Village, Kandivali (East), Mumbai - 400101 [PAN: AKHPM8621J) Assistant Commissioner of Income Tax, 33(1), Mumbai, Bandra Kurla Complex, Bandra (East), Mumbai - 400051 ............... Vs ................ Appellant Respondent Appearance For the Appellant/Assessee For the Respondent/Department : : Shri Rajesh Kothari Shri Manoj Kumar Sinha Date Conclusion of hearing Pronouncement of order : : 24.07.2023 27.07.2023 O R D E R Per Rahul Chaudhary, Judicial Member: 1. By way of the present appeal the Appellant has challenged the order, dated 20/03/2023, passed by the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘the CIT(A)’] for the Assessment Year 2013-14, whereby the Ld. CIT(A) had dismissed the appeal of the Appellant against the Assessment Order, dated 23/03/2016, passed under Section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’). 2. The Appellant has raised the following grounds of appeal: ITA No.1635Mum/2023 (Assessment Year: 2013-14) 2 “Order passed without giving an opportunity of being heard 1) The learned Commissioner of Income tax (A) has erred in passing an order on 20/03/2023 without giving an opportunity of being heard and without considering the adjournment request submitted on 14/03/2023 prior to response due date of 17/03/2023 mentioned in the notice dated 10/03/2023 issued for the first time in faceless proceeding. Denial of deduction u/s. 54 2) The learned CIT(A) erred in confirming the denial of deduction of Rs. 74,16,667 claimed u/s. 54 of the Income tax Act, 1961 (the Act) though the assesee has utilized the amount of capital gain for purchasing residential house before the due date of furnishing return of income. Disallowance of sub-brokerage 3) The learned CIT(A) erred in confirming disallowance of the Sub-brokerage expenses of Rs. 50,000 paid to Varsha Khatri and Rs. 40,000 paid to Mahendra Parekh though the said expenses are incurred wholly and exclusively for the purposes of business. Addition of Gift of Rs. 61,000 u/s. 68 4) The learned CIT(A) erred in confirming addition of Rs. 61,000 received as gift from the aunt of the assessee u/s. 68. 5) Without prejudice to above, the learned CIT(A) should have allowed deduction of Rs. 50,000 received as a gift without adequate consideration u/s. 56 of the Act. Disallowance of Interest 6) The learned CIT(A) erred in confirming disallowance of interest of Rs. 60,000 paid to Keshvi Developers. Denial of deduction of maintenance charges - Additional ground 7) The learned ACIT erred in denying the deduction of maintenance charges of Rs. 76,423 paid to co-operative housing society from the annual value being gross rental income.” 3. When the appeal was taken up for hearing, the Ld. Authorised ITA No.1635Mum/2023 (Assessment Year: 2013-14) 3 Representative for the Appellant pressed into service Ground No. 1 raised in the appeal and submitted that the order impugned way of the present appeal has been passed by the CIT(A) without granting sufficient opportunity of being heard to the Appellant. 4. We have heard both the sides on this issue. On perusal of material on record, we find that appeal was filed physically on 12/04/2016 and was taken up for physical hearing by the CIT(A) on various occasions. A perusal of order-sheet notings made by the CIT(A) and placed before us as part of the paper-book show that the Appellant had filed written submissions, paper-book as well as application for admission of additional evidence before CIT(A); the CIT(A) had also called for a remand report from the Assessing Officer in respect of the additional evidence; and the issues raised in appeal were discussed. On account of transition from physical proceedings before CIT(A) to faceless appellate proceedings, notice for the first time was issued on 10/03/2023 requiring the Appellant to respond by 17/03/2023. The Appellant vide letter dated 14/03/2023 filed online sought an adjournment. However, the CIT(A) proceeded to pass the order on 20/03/2023. A perusal of orders shows that the CIT(A) has failed to consider any of the submissions, documents and evidence filed by the Appellant during the course of appellate proceedings. No reference has been made to the remand report from the Assessing Officer in respect of additional evidence filed by the Appellant. In our view, the order has been passed by the CIT(A) without taking into consideration the material placed on record by the Appellant during the appellate proceedings before CIT(A) and also without granting the Appellant a reasonable opportunity of being heard. In view of the aforesaid, we set aside the order dated 20/03/2023, passed by the CIT(A) ITA No.1635Mum/2023 (Assessment Year: 2013-14) 4 dismissing the appeal of the Assessee against the Assessment Order, dated 23/03/2016 for the Assessment Year 2013-14 and with the directions to CIT(A) to decide the appeal afresh as per law after taking into consideration the material on record and after granting the Appellant a reasonable opportunity of being heard. In terms of the aforesaid Ground No. 1 raised by the Appellant is allowed while Ground No. 2 to 7 raised by the Appellant are disposed of as being infructuous. 5. In result, the present appeal preferred by the Assessee is treated as being allowed for statistical purposes. Order pronounced on 27.07.2023. Sd/- Sd/- (B.R. Baskaran) Accountant Member (Rahul Chaudhary) Judicial Member म ुंबई Mumbai; दिन ुंक Dated : 27.07.2023 Alindra, PS ITA No.1635Mum/2023 (Assessment Year: 2013-14) 5 आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to : 1. अपील र्थी / The Appellant 2. प्रत्यर्थी / The Respondent. 3. आयकर आय क्त/ The CIT 4. प्रध न आयकर आय क्त / Pr.CIT 5. दिभ गीय प्रदिदनदध, आयकर अपीलीय अदधकरण, म ुंबई / DR, ITAT, Mumbai 6. ग र्ड फ ईल / Guard file. आिेश न स र/ BY ORDER, सत्य दपि प्रदि //True Copy// उप/सह यक पुंजीक र /(Dy./Asstt. Registrar) आयकर अपीलीय अदधकरण, म ुंबई / ITAT, Mumbai