ALPA V SAVLA, MUMBAI V. ITO 22(1)(1), MUMBAI

ITA 1677/MUM/2015

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 3502 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-06-2016
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 23-03-2015
• Court: TRIBUNAL
• Assessee Lawyers: DEVENDRA H JAIN
• Keywords: Opportunity of being heard
• Section: 143(3); 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI B.R. BASKARAN (AM) I.T.A. NO. 1677 /MUM/ 20 15 (ASSESSMENT YEAR 200 9 - 1 0 ) SMT. ALPA V. SAVLA 31/123, KALPATARU AURA LBS MARG GHATKOPAR WEST MUMBAI - 400 086. VS. ITO 22(1)(1) BANDRA KUR LA COMPLEX BANDRA MUMBAI. ( APPELLANT ) ( RESPONDENT ) PAN NO . AAFPC1936N ASSESSEE BY SHRI DEVENDRA H. JAIN DEPARTMENT BY SHRI MANOJ KUMAR DATE OF HEARING 27 . 6. 201 6 DATE OF PRONOUNCEMENT 27 . 6 . 201 6 O R D E R THE APPEAL FILED BY THE ASSE SSEE IS DIRECTED A GAINST THE ORDER DATED 20.1.2015 PASSED BY LEARNED CIT(A) - 2 5 , MUMBAI AND IT RELATES TO A.Y. 200 9 - 1 0. 2. THE ASSESSEE IS AGGRIEVED BY THE DECISION OF LEARNED CIT(A) IN CONFIRMING THE ORDER OF THE ASSESSING OFFICER IN REJECTING THE CLAIM OF COST OF IMPROVEMENT OF ` 7,50,000/ - WHILE COMPUTING SHORT TERM CAPITAL GAIN AND ALSO IN NOT ALLOWING CLAIM OF SET OFF OF BROUGHT FORWARD SHORT TERM CAPITAL LOSS OF ` 4,37,551/ - RELATING TO A.Y. 2008 - 09. 3. LEARNED COUNSEL APPEARING FOR THE ASSESSEE S UBMITTED THAT THE ASSESSMENT OF THE YEAR UNDER CONSIDERATION WAS COMPLETED ORIGINALLY U/S. 143(3) OF THE ACT ACCEPTING THE RETURN OF INCOME FILED BY THE ASSESSEE. IN THE RETURN OF INCOME THE ASSESSEE HAD INADVERTENTLY OMITTED TO DISCLOSE SHORT TERM CAPITAL GAIN EARNED BY HER. HOWEVER, DURING THE COURSE OF ASSESSMENT SMT. ALPA V.SAVLA 2 PROCEEDINGS, THE ASSESSEE FURNISHED ALL THE DETAILS RELATING TO SHORT TERM CAPITAL GAIN VIDE HER LETTER FILED ON 11.11.2011 WITH THE ASSESSING OFFICER. HOWEVER, THE ASSESSING OFFICER ALSO INADVE RTENTLY OMITTED TO ASSESS SHORT TERM CAPITAL GAIN. SUBSEQUENTLY, THE ASSESSING OFFICER ISSUED A NOTICE DATED 9.7.2013, PRESUMABLY U/S. 154 OF THE ACT , IN ORDER TO ASSESS SHORT TERM CAPITAL GAIN. SUBSEQUENT THERETO THE ASSESSING OFFICER PASSED AN ORDER U/S. 154 OF THE ACT ON 1.10.2013. HOWEVER, WHILE COMPUTING SHORT TERM CAPITAL GAIN, THE ASSESSING OFFICER REJECTED CLAIM OF COST OF IMPROVEMENT ON THE REASONING THAT NO DETAILS OR BILLS RELATING TO THE SAME WAS FURNISHED BY THE ASSESSEE. SIMILARLY, HE ALSO REJ ECTED THE CLAIM OF SET OFF OF BROUGHT FORWARD LOSSES ON THE REASONING THAT THE ASSESSEE DID NOT FURNISH RELEVANT DETAILS. LEARNED AR SUBMITTED THAT THAT THE ASSESSING OFFICER IS NOT EXPECTED TO PROBE THE DETAILS IN THE RECTIFICATION PROCEEDINGS CARRIED OUT U/S. 154 OF THE ACT AND HE IS AUTHORISED ONLY TO CORRECT THE MISTAKES APPARENT FROM THE RECORD. LEARNED AR SUBMITTED THAT THE ASSESSEE HAD FURNISHED ALL RELEVANT DETAILS DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS AND HENCE THE ASSESSING OFFICER WAS NOT CORRECT IN OBSERVING THAT THE ASSESSEE DID NOT FURNISH DETAILS. LEARNED AR FURTHER SUBMITTED THAT LEARNED CIT(A) HAS CONFIRMED THE DISALLOWANCE WITHOUT CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND ALSO DETAILS FURNISHED BY THE ASSESSEE. ACCORDI NGLY, HE SUBMITTED THAT THE TAX AUTHORITIES MAY BE DIRECTED TO ALL OW BOTH THE CLAIM S OF THE ASSESSEE , SINCE RELEVANT DETAILS ARE ALREADY AVAILABLE ON RECORD. 4. ON THE CONTRARY, LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE ASSESSEE HAS PURCHASED THE PROPERTY ON 7.2.2012 AND CLAIMED TO HAVE INCURRED EN TIRE EXPENDITURE TOWARDS IMPROVEMENT ON 8.2.2007 ITSELF . HENCE LEARNED CIT(A) HAS EXPRESSED DOUBTS ABOUT THE CLAIM MADE BY THE ASSESSEE , SINCE IMPROVEMENT TO IMMOVABLE PROPERTY CANNOT BE CARRIED OUT IN ONE DAY THAT TOO , TO THE EXTENT OF ` 7,50,000/ - . SMT. ALPA V.SAVLA 3 5. WITH REGARD TO THE CLAIM OF SET OFF OF BROUGHT FORWARD LOSSES, LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE ASSESSEE HAS NOT SHOWN RELEVANT DETAILS IN THE RETURN OF INCOME AND HENCE SAID CLA IM WAS REJECTED. 6. I HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. I NOTICED FROM THE LETTER FILED WITH THE ASSESSING OFFICER ON 11.11.2011 WHICH IS PLACED ON RECORD AT PAGE NO. 38 OF THE PAPER BOOK, THAT THE ASSESSEE HAS FURNISHED DETAILS REL ATING TO LOSSES INCURRED IN EARLIER YEAR AND ALSO FURNISHED DETAILS OF COMPUTATION OF CAPITAL GAIN. BEFORE LEARNED CIT(A) THE ASSESSEE HAS FURNISHED DETAILS OF PAYMENT OF ` 7,50,000/ - TOWARDS COST OF IMPROVEMENT. I NOTICED THAT THE ABOVE SAID AMOUNT OF ` 7 ,50,000/ - HAS BEEN PAID BY WAY OF CHEQUE S ON 8.2.2007 I.E. ON THE NEXT DATE OF PURCHASE OF THE PROPERTY. ACCORDINGLY, LEARNED CIT(A) HAS INFERRED THAT THE ASSESSEE COULD NOT HAVE PAID THE ENTIRE AMOUNT OF COST OF IMPROVEMENT ON THE VERY NEXT DATE. HOWEVER, I NOTICED THAT LEARNED CIT(A) HAS NOT CALLED FOR ANY EXPLANATION WITH REGARD TO THE PAYMENT SO MADE AND HAS ALSO NOT EXAMINED THE DETAILS OF COST OF IMPROVEMENT CLAIMED TO HAVE BEEN CARRIED OUT BY THE ASSESSEE. I HAVE EARLIER NOTICED THAT THE ASSESSEE HA S CLAIMED TO HAVE FURNISHED THE RELEVANT DETAILS BEFORE THE AO, BUT THE AO DID NOT EXAMINE THE SAME. ACCORDINGLY, I AM OF THE VIEW THAT THIS ISSUE REQUIRES FRESH EXAMINATION AT THE END OF THE ASSESSING OFFICER. WITH REGARD TO THE CLAIM OF SET OFF OF BROUGH T FORWARD LOSSES ALSO , I NOTICED THAT THE ASSESSEE HAS FURNISHED RELEVANT DETAILS TO THE ASSESSING OFFICER AND HENCE THE SAME IS REQUIRED TO BE ALLOWED IN ACCORDANCE WITH LAW AFTER CARRYING OUT NECESSARY EXAMINATION, SINCE THERE IS NO ESTOPPEL AGAINST LAW. 7. IN VIEW OF THE FORGOING, I SET ASIDE THE ORDER PASSED BY LEARNED CIT(A) IN RESPECT OF BOTH THE ISSUES UNDER CONSIDERATION AND RESTORE THEM TO THE FILE OF THE ASSESSING OFFICER WITH THE DIRECTION TO EXAMINE THE CLAIMS OF THE ASSESSEE AND TAKE APP ROPRIATE DECISION IN ACCORDANCE WITH LAW, AFTER AFFORDING NECESSARY OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. SMT. ALPA V.SAVLA 4 8 . IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER HAS BEEN PRONO U NCED IN THE OPEN COURT ON 27 . 6 .2016 . SD/ - (B.R.BASKARAN ) ACCOUNTANT MEMBER MUMBAI ; DATED : 27 / 6/ 20 1 6 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLAN T 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( DY./ASSTT. REGISTRAR) ITAT, MUMBAI PS