AMEETA DHARAMPAL KAPUR, MUMBAI V. ITO 21(3)(1), MUMBAI

ITA 1656/MUM/2012

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 3194 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 3 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-06-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 30-04-2015
• Assessment Year: 2003-2004
• Appeal Filed On: 09-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A RAMACHANDRAN
• Keywords: Gift; Income from undisclosed sources; Principle of natural justice
• Section: 143(3); 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES A, MUMBAI BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER & SHRI ROMIT KOCHAR KUMAR, ACCOUNTANT MEMBER ITA NO1656/MUM/2012 ASSESSMENT YEAR: 2003-04 AMEETA DHARAMPAL KAPUR 504 WING, 1-A, MINAL SAKI VIHAR ROAD, ANDHERI (W), MUMBAI- 400 072. PAN AJSPK7119D VS. ITO 21(3)(1) MUMBAI (APPELLANT) (RESPONDENT) APPELLANT BY : MS. NEHA PARANJPE RESPONDENT BY : SHRI A RAMACHANDRAN DATE OF HEARING : 07 .0 6 .201 6 DATE OF PRONOUNCEMENT : 15 .0 6 . 201 6 O R D E R PER MAHAVIR SINGH, JUDICIAL MEMBER THIS APPEAL BY ASSESSEE IS ARISING OUT OF THE ORDE R OF THE CIT(A) 32, MUMBAI, IN APPEAL NO.CIT(A)-32/ITO-21(3)(1)/IT-246/ 10-11 DATED 07.12.2011. THE ASSESSMENT WAS FRAMED BY THE ITO 21(3)(1), MUMBAI, FOR A.Y. 2003-04 VIDE HIS ORDER DATED 30.12.2010 U/S. 143(3) OF THE INCOME TA X ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT). 2. THE ONLY ISSUE IN THIS APPEAL OF THE ASSESSEE IS AGAINST THE ORDER OF THE CIT(A) CONFIRMING THE ACTION OF THE AO IN TREATING THE LONG TERM CAPITAL GAIN DECLARED BY THE ASSESSEE AS INCOME FROM UNDISCLOSED SOURCES AMOUNTING TO RS.5,21,350/-. ITA NO.1656/MUM/2013 AMEETA DHARAMPAL KAPUR 2 3. AT THE OUTSET, LEARNED COUNSEL FOR THE ASSESSEE FIRST OF ALL DREW OUR ATTENTION TO GROUND NO.3 WHEREIN IT WAS RAISED THAT THE BASIS OF ADDITION BY THE WAS AO ON THE BASIS OF MATERIAL COLLECTED AT THE BACK OF THE ASSESSEE WITHOUT PROVIDING AN OPPORTUNITY TO THE ASSESSEE TO CROSS EXAMINE THE EV IDENCE. THE COUNSEL DREW OUR ATTENTION TO THE FOLLOWING GROUND NO.3 WITHOUT PREJUDICE TO THE ABOVE THE LD. CIT(A) FAIL ED TO APPRECIATE THAT THE LD. ASSESSING OFFICER HAS MADE THE ADDITIONS ON THE BASIS OF MATERIAL COLLECTED AT THE BACK OF THE APPELLANT AND WITHOUT PROVIDING THE APPELLANT OPPORTUNITY TO CROSS EXAMINE THE EVIDENCE SO COLLEC TED. THEREFORE, TREATING THE LONG TERM CAPITAL GAIN OF RS.5,21,350/ - AS UNDISCLOSED INCOME IS AGAINST THE PRINCIPLES OF NATURAL JUSTICE AND HENCE THE SAME MAY BE DELETED. THE LEARNED COUNSEL FOR THE ASSESSEE FURTHER DREW O UR ATTENTION TO THE REASONS RECORDED FOR ISSUING NOTICE U/S. 148 OF THE ACT, DA TED 30.03.2010 (WHICH ARE REPRODUCED IN THE ORDER OF THE AO AS WELL AS THAT O F THE CIT(A)), WHICH READS AS UNDER :- SHRI NARENDRA R SHAH (HAWALA OPERATOR) HAS ADMITTE D BEFORE THE INCOME TAX AUTHORITIES THAT HE HAS PROVIDED TO SEVE RAL PARTIES VARIOUS FINANCIAL ACCOMMODATION TRANSACTIONS FOR THE PURPOS E OF CLAIMING CAPITAL GAINS, GIFTS, ETC. IN RESPECT OF ALSO, HE HAS SUBMI TTED THAT YOU ARE ONE OF THE BENEFICIARY WHO HAS AVAILED FINANCIAL ACCOMMODA TION ENTRIES FOR BOGUS LONG TERM CAPITAL GAINS FOR SHARES OF M/S. DA TABASE FINANCE LTD. THE LEARNED COUNSEL FOR THE ASSESSEE STATED THAT TH E ASSESSEE HAS SOLD 700 SHARES OF DATA FINANCE LTD. ON 20.01.2003 FOR A SUM OF RS. 5,21,350/- THROUGH ACTION FINANCIAL SERVICES (INDIA) LTD., WHICH WERE PURCHAS ED BY HER ON 10.04.2001 FOR A SUM OF RS.8,330/- AND THROUGH A BROKER DRISHTI SECU RITIES PVT. LTD. ACCORDING TO THE LEARNED COUNSEL SHRI NARENDAR R SHAH, ALLEGEDLY BEI NG A HAWALA OPERATOR WAS EXAMINED AND ON THE BASIS OF HIS STATEMENT, ADDITIO N WAS MADE AND ASSESSMENT WAS REOPENED. ACCORDING TO THE LEARNED COUNSEL THI S WAS DONE BEHIND THE BACK OF ITA NO.1656/MUM/2013 AMEETA DHARAMPAL KAPUR 3 THE ASSESSEE AND NO OPPORTUNITY TO CROSS EXAMINE TH E PARTY WAS ALLOWED. ACCORDING TO HER THIS ISSUE NEEDS SETTING ASIDE TO THE FILE O F THE AO SO THAT HE CAN ALLOW AN OPPORTUNITY TO THE ASSESSEE TO CROSS-EXAMINE THE PA RTY AND REBUT THE MATERIAL COLLECTED AT HER BACK. WHEN THIS WAS PUT TO THE LE ARNED DR, HE FAIRLY CONCEDED THAT THE ISSUE CAN BE SENT BACK TO THE FILE OF THE AO FO R FRESH ADJUDICATION AFTER ALLOWING OPPORTUNITY TO THE ASSESSEE. IN TERMS OF THE ABOVE , WE SET ASIDE THE ORDERS OF THE LOWER AUTHORITIES AND REMAND THE MATTER BACK TO THE FILE OF THE AO FOR RECONSIDERATION OF THIS ISSUE AFRESH AFTER ALLOWING THE ASSESSEE REASONABLE OPPORTUNITY TO CROSS EXAMINE THE PARTY AND BEING HE ARD. 4. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATIST ICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY OF 1 5 TH JUNE 2016. SD/- SD/- (RAMIT KOCHAR) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED : 15 TH JUNE, 2016. SA COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE C I T(A), MUMBAI. 4. THE C I T 5. THE DR, A BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, MUMBAI