KAUSHALYA R. SAMPAT, MUMBAI V. ITO 19(3)(2), MUMBAI

ITA 1839/MUM/2012

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3124 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 5 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-09-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 13-05-2015
• Assessment Year: 2003-2004
• Appeal Filed On: 16-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A RAMACHANDRAN
• Keywords: Unexplained cash credit; Loose papers; Opportunity of being heard; Reassessment proceedings
• Section: 143(3); 142(1); 133A; 234B; 147; 68; 148; 144; 139

Judgement Text

A IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ./ I.T.A. NO.1839 /MUM/2012 ( / ASSESSMENT YEAR : 2003-04) MRS. KAUSHALYA R. SAMPAT 1-A, HILL TOP 49, PALI HILL ROAD BANDRA(WEST), MUMBAI-400 050 / V. ITO, 19(3)(2) PIRAMAL CHAMBERS LALBAUG MUMBAI 400 012. ./ PAN : AAQPS0609F ( / APPELLANT ) .. ( / RESPONDENT ) ASSESSEE BY SHRI K.GOPAL REVENUE BY : SHRI A. RAMACHANDRAN / DATE OF HEARING : 21-6-2016 / DATE OF PRONOUNCEMENT : 15-09-2016 / O R D E R PER RAMIT KOCHAR, ACCOUNTANT MEMBER THIS APPEAL, FILED BY THE ASSESSEE , BEING ITA NO. 1839/MUM/2012, IS DIRECTED AGAINST THE APPELLATE ORDER DATED 09 TH JANUARY 2012 PASSED BY LEARNED COMMISSIONER OF INCOME TAX (APPEALS)- 30, M UMBAI (HEREINAFTER CALLED THE CIT(A)), FOR THE ASSESSMENT YEAR 2003- 04, THE APPELLATE PROCEEDINGS BEFORE THE LEARNED CIT(A) ARISING FROM THE ASSESSMENT ORDER DATED 22 ND DECEMBER 2010 PASSED BY THE LEARNED ASSESSING OFFI CER (HEREINAFTER CALLED THE AO) U/S 144 READ WITH SEC TION 147 OF THE INCOME TAX ACT,1961 (HEREINAFTER CALLED THE ACT). ITA 1839/MUM/2012 2 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE IN THE MEMO OF APPEAL FILED WITH THE INCOME TAX APPELLATE TRIBUNAL, MUMBA I (HEREINAFTER CALLED THE TRIBUNAL) READ AS UNDER:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED C.I.T.(A) ERRED IN DISMISSING THE APPEAL AND THAT TOO WITHOUT GIVING ANY OPPORTUNITY OF BEING HEARD IN THE MATTER. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED CIT(A) ERRED IN DISMISSING THE APPEAL AND TH AT TOO WITHOUT APPRECIATING FULLY AND PROPERLY THE FACTS OF THE CASE . 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED CIT(A) ERRED IN UPHOLDING THE VALIDITY OF TH E REASSESSMENT PROCEEDINGS INITIATED BY ISSUANCE OF NOTICE U/S. 148 OF THE I.T.ACT. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED CIT(A) ERRED IN UPHOLDING THE VALIDITY OF TH E ASSESSMENT ORDER PASSED U/S. 144 R.W.S. 147 OF THE I.T.ACT. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AN D IN LAW , THE LEARNED CIT(A) ERRED IN CONFIRMING THE ADDITION MADE OF RS.46 LACS AS UNEXPLAINED INCOME U/S 68 OF THE I.T.ACT. 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED CIT(A) ERRED IN DISMISSING THE GROUNDS OF AP PEAL PERTAINING TO CHARGING OF INTEREST U/S. 234A, 234B AND 234C OF TH E I.T.ACT 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS PARTNER IN THE FIRM M/S DECCAN ENTERPRISES. SURVEY ACTION WAS CONDUCTED U/S 133A OF THE ACT BY THE ITO WARD 19(3)(1), MUMBAI IN THE CASE OF DECCAN ENTERPRISES ON 12.09.2007 AND AS INFORMED BY THE SAID ITO TO THE A O , CERTAIN INCRIMINATING DOCUMENTS AND LOOSE PAPERS PERTAINING TO THE ASSESS EE WERE FOUND IN THE PREMISES OF DECCAN ENTERPRISES DURING THE COURSE OF SURVEY OPERATIONS IN WHICH THE ASSESSEE WAS PARTNER. ON PERUSAL OF THE I MPOUNDED DOCUMENTS PERTAINING TO THE ASSESSEE AS RECEIVED FROM THE ITO , WARD 19(3)(1), MUMBAI, IT WAS OBSERVED BY THE AO THAT COPIES OF DEMAND DRA FT/CHEQUES ISSUED IN THE NAME OF THE ASSESSES (LOOSE PAPER FILE NO A-4 , PAG E 90-100) TO THE AGGREGATE VALUE OF RS 51 LACS WERE FOUND AND IMPOUNDED AS PER THE DETAILS IN ITA 1839/MUM/2012 3 ASSESSMENT ORDER DATED 22-12-2010/PAGE1 WHICH AS PE R THE AO ARE NOT REFLECTED IN THE RETURN OF INCOME FILED BY THE ASSE SSEE FOR THE ASSESSMENT YEAR 2003-04. DURING SURVEY ACTION ON 12.09.2007, STATEM ENT OF SH. RAJGOPALCHARI SAMPAT , CONSTITUTED ATTORNEY OF THE FIRM AND HUSBAND OF THE ASSESSEE WAS RECORDED ON OATH ON 12.09.2007 WHEREIN SAID SH. RAJGOPALCHARI SAMPAT ACCEPTED THAT THE ABOVE SUM REPRESENTS SALES PROCEEDS OF IMMOVABLE PROPERTY AND ALSO THAT INCOME EARNED FROM SALE OF T HIS UNDISCLOSED HOUSE PROPERTY AT BANGALORE WAS NOT OFFERED FOR TAXATION BY THE ASSESSEE IN THE RETURN OF INCOME FILED WITH THE REVENUE. BASED ON T HE ABOVE FACTS , THE CASE OF THE ASSESSEE FOR ASSESSMENT YEAR 2003-04 WAS REOPEN ED U/S 147 OF THE ACT AS PER REASONS RECORDED AND WITH THE PRIOR APPROVAL OF ADDITIONAL CIT VIDE APPROVAL DATED 24-03-2010. ACCORDINGLY NOTICES U/S 148 OF THE ACT WAS ISSUED TO THE ASSESSEE BY THE AO ON 24-03-2010 WHIC H WAS SERVED ON THE ASSESSEE ON 25-03-2010. THE ASSESSEE SUBMITTED THA T THE RETURN OF INCOME OF THE ASSESSES FILED U/S. 139 OF THE ACT BE TREATED A S RETURN OF INCOME FILED U/S. 148 OF THE ACT. THEREAFTER, SEVERAL NOTICES WERE IS SUED U/S. 142(1) OF THE ACT BY THE AO REQUIRING ASSESSEE TO APPEAR BEFORE THE A O IN CONNECTION WITH THE REASSESSMENT PROCEEDINGS U/S. 147/148 OF THE ACT BU T THERE WAS NO COMPLIANCE ON THE PART OF THE ASSESSSEE. ON 06.12.2 010 , SH R.C.SAMPAT, HUSBAND OF THE ASSESSEE APPEARED BEFORE THE AO AND SOUGHT ADJOURNMENT TO 08-12-2010. AGAIN ON 08-12-2010 NONE APPEARED BEFOR E THE AO. THE AO PROCEEDED TO FRAME EX-PARTE ORDER U/S. 144 OF THE A CT BASED ON MATERIAL ON RECORD, KEEPING IN VIEW THE MATTER BEING GETTING TI ME BARRED BY LIMITATION . THE AO BASED ON THE IMPOUNDED COPIES OF CHEQUES DUR ING SURVEY AND STATEMENTS RECORDED DURING SURVEY ACTION, MADE ADDI TION OF RS. 46,00,000/- TOWARDS CHEQUES/DRAFTS RECEIVED FOR SALE OF HOUSE P ROPERTY AT BANGALORE AS NO EXPLANATION WAS OFFERED BY THE ASSESSEE WITH RESPEC T TO OWNERSHIP OF THE SAID PROPERTY. SINCE ONE DD NO 758280 FOR RS. 5,00,000/ - PERTAINED TO THE ASSESSMENT YEAR 2004-05 , NO ADDITION OF THE SAID A MOUNT OF RS. 5 LACS WAS MADE DURING THE IMPUGNED ASSESSMENT YEAR OUT OF COP IES OF CHEQUES/DD OF ITA 1839/MUM/2012 4 RS. 51 LACS IMPOUNDED DURING THE ASSESSMENT YEAR AN D BALANCE RS. 46 LACS WAS ADDED TO THE INCOME AS INCOME BEING UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT VIDE EX-PARTE ASSESSMENT ORDER DATED 22.12. 2010 PASSED BY THE AO U/S 144 READ WITH SECTION 147 OF THE ACT. 4. AGGRIEVED BY THE EX-PARTE ASSESSMENT ORDER DATED 22.12.2010 PASSED BY THE AO U/S. 143(3) READ WITH SECTION 147 OF THE ACT , THE ASSESSEE FILED FIRST APPEAL BEFORE THE LEARNED CIT(A) . THE ASSESSEE DID NOT APPEAR BEFORE THE LEARNED CIT(A) DESPITE SEVERAL OPPORTUNITIES BEING GIVEN BY LEARNED CIT(A) AND THE APPEALS WAS DISMISSED BY THE LEARNED CIT(A) BAS ED ON MATERIAL ON RECORD VIDE APPELLATE ORDER DATED 09-01-2012 PASSED BY LEA RNED CIT(A). 5. AGGRIEVED BY THE APPELLATE ORDER DATED 09-01-201 2 PASSED BY LEARNED CIT(A) DISMISSING THE ASSESSEE APPEAL , THE ASSESSE E FILED SECOND APPEAL WITH THE TRIBUNAL. 6. THE LEARNED COUNSEL FOR THE ASSESSEE CONTENDED B EFORE THE TRIBUNAL THAT AN EX-PARTE APPELLATE ORDER HAS BEEN PASSED BY LEARNED CIT(A) IT WAS SUBMITTED THAT ON SIMILAR FACTS, THE TRIBUNAL HAS SET ASIDE A ND RESTORED THE MATTER TO THE FILE OF LEARNED CIT(A) FOR DE-NOVO ADJUDICATION OF APPEAL BY AFFORDING ONE MORE OPPORTUNITY TO THE TAX-PAYERS FOR MAKING SUBMI SSIONS BEFORE THE LEARNED CIT(A) ON MERITS IN ITA NO. 1838/MUM/2012 A ND ITA NO. 1840/MUM/2012 VIDE COMMON ORDER DATED 24/10/2013 FO R THE ASSESSMENT YEAR 2003-04 IN THE CASE OF RELATIVES OF THE ASSESS EE NAMELY SMT RASHMI SAMPAT AND SH RAJESH SAMPAT . IT WAS PRAYED THAT TH E ONE MORE OPPORTUNITY BE GRANTED TO THE ASSESSEE AND THE ISSUE/MATTER MAY BE SET ASIDE AND RESTORED TO LEARNED CIT(A) AND THE ASSESSEE WILL PR ESENT HER CASE ON MERITS BEFORE LEARNED CIT(A) BY FILING ALL NECESSARY AND R ELEVANT EVIDENCES AND EXPLANATIONS. THE LEARNED DR RELIED UPON THE ORDERS OF LEARNED CIT(A) AND SUBMITTED THAT IN THE CASE OF THE RELATIVES OF THE ASSESSEE AS SET OUT ABOVE , ITA 1839/MUM/2012 5 THE MATTER WAS SET ASIDE BY THE TRIBUNAL TO THE FIL E OF LEARNED CIT(A) AND ON THE SAME BASIS , THE ISSUE/MATTER IN THIS APPEAL MA Y ALSO BE SET ASIDE AND RESTORE TO THE FILE OF LEARNED CIT(A). 7. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND PER USED THE MATERIAL ON RECORD. WE HAVE OBSERVED THAT ON SIMILAR FACTS THE ISSUE / MATTER WAS RESTORED TO THE FILE OF LEARNED CIT(A) BY THE TRIBU NAL IN ITA NO. 1838/MUM/2012 AND 1840/MUM/2012 VIDE COMMON ORDERS DATED 24/10/2013 IN THE CASE OF RELATIVES OF THE ASSESSEE NAMELY SMT RASHMI SAMPAT AND SH RAJESH SAMPAT BY HOLDING AS UNDER: 7. WE HAVE HEARD BOTH THE PARTIES AND THEIR CONTEN TIONS HAVE CAREFULLY BEEN CONSIDERED. FOR THE SAKE OF CONVENIENCE WE MAY REPRODUCE THE RELEVANT PARAS OF THE ORDERS OF LD. CIT(A) WHICH S TATE THE REASONS FOR PROCEEDING TO DECIDE THE APPEALS EX-PARTE: IN THE CASE OF SMT. RASHI SAMPAT: THE PRESENT APPEAL IS DIRECTED AGAINST THE ASSESSM ENT ORDER PASSED BY ITO 19(3)(2), MUMBAI U/S. U/S.144 R.W.S. 147 OF THE I.T. ACT, 1961 ) DATED 22.12.2010. IN THIS CASE THE FIRS T NOTICE OF HEARING WAS ISSUED ON / 23.8.2011 FIXING THE CASE F OR HEARING ON 14.9.2011 AT 11.45 AM. HOWEVER, IN RESPONSE TO THIS NOTICE NEITHER ANYBODY ATTENDED NOR ANY ADJOURNMENT WAS SOUGHT. TH EREFORE, ANOTHER NOTICE DATED 11.10.2011 WAS ISSUED FIXING T HE CASE FOR HEARING ON 1.11.11 AT 11.30 AM. IN RESPONSE TO THIS NOTICE ALSO NEITHER ANYBODY ATTENDED NOR ANY ADJOURNMENT WAS SO UGHT. THIS BEING SO A NOTICE DATED 28.11.11 WAS ISSUED FIXING THE CASE FOR HEARING ON 15.12.2011 AT 12 PM. HOWEVER, AS USUAL N EITHER ANYBODY ATTENDED NOR ANY ADJOURNMENT WAS SOUGHT. ITA 1839/MUM/2012 6 2.1 FROM THE ABOVE IT BECOMES CLEAR THAT THE APPELL ANT IS NOT INTERESTED IN PURSUING HER APPEAL AND THEREFORE THE APPEAL OF THE APPELLANT IS DECIDED EXPARTE ON THE BASIS OF MATERI AL AVAILABLE ON RECORD. THE APPELLANT HAS RAISED VARIOUS GROUNDS OF APPEAL WHICH ARE AS UNDER: IN THE CASE OF SHRI RAJESH SAMPAT: 2.1. IN THIS CASE, FIRST NOTICE OF HEARING WAS ISS UED ON 09-09-20 11 FIXING THE CASE FOR HEARING ON 27-09-2011 AT 3.00 P .M. THIS NOTICE WAS DULY SERVED ON THE APPELLANT. HOWEVER, IN RESPO NSE TO THIS NOTICE, NEITHER ANYBODY ATTENDED NOR ANY ADJOURNMEN T WAS SOUGHT. THEREFORE, ANOTHER NOTICE DATED 29-09-2011, FIXING THE CASE FOR HEARING ON 19-10-2011 AT 12. P.M. WAS ISSU ED. THERE WAS NO COMPLIANCE TO THIS NOTICE ALSO AS NEITHER ANYBOD Y ATTENDED NOR ANY LETTER FOR ADJOURNMENT WAS FILED. THEREFORE, AN OTHER NOTICE DATED 19-10-2011 WAS ISSUED FIXING THE CASE FOR HEA RING ON 7-11- 2011 AT 11 .30A.M. HOWEVER, ON THIS DATE ALSO, NEIT HER NOBODY ATTENDED NOR ANY ADJOURNMENT WAS SOUGHT. THIS BEING SO, FINAL NOTICE OF HEARING DATED 21-11-2011 WAS ISSUED FIXIN G THE CASE FOR HEARING ON 29-11-2011 AT 3.45 P.M. HOWEVER AS USUAL NEITHER ANYBODY ATTENDED IN RESPONSE TO THIS NOTICE NOR ANY ADJOURNMENT WAS SOUGHT. UNDER THE CIRCUMSTANCES, IT BECOMES QUI TE CLEAR THAT THE APPELLANT IS NOT INTERESTED IN PURSUING HIS APP EAL AND THEREFORE, THE APPEAL OF THE APPELLANT IS DECIDED E X-PARTE ON THE BASIS OF MATERIAL AVAILABLE ON RECORD. AT THIS JUNC TURE, IT WILL NOT BE OUT OF PLACE TO MENTION THAT SAME KIND OF NON-COOPE RATION / NON- COMPLIANCE WAS SHOWN BY THE APPELLANT DURING THE AS SESSMENT PROCEEDINGS ALSO WHICH RESULTED IN PASSING EX-PARTE ORDER U/S. 144 R.W.S. 147 OF THE I.T. ACT. ITA 1839/MUM/2012 7 A PERUSAL OF THE AFOREMENTIONED PARAS WILL REVEAL T HAT IT IS NOT STATED BY LD.CIT(A) THAT THE LAST DATE ON WHICH THE APPEAL OF THE ASSESSEE IS DECIDED EX-PARTE, THE NOTICE WAS DULY SERVED UPON T HE ASSESSEE. THEREFORE, ACCORDING TO FACTS OF THE PRESENT CASE I T CAN BE PRESUMED THAT ON THE LAST DATE OF HEARING NOTICE ISSUED BY LD. CI T(A) WAS NOT DULY SERVED UPON THE RESPECTIVE ASSESSEES. TAKING INTO C ONSIDERATION SUCH FACT, WE ARE OF THE OPINION THAT IT WOULD SERVE THE INTEREST OF JUSTICE IF THE MATTER IS RESTORED BACK TO THE FILE OF LD. CIT(A) W ITH A DIRECTION TO RE- ADJUDICATE THESE APPEALS IN ACCORDANCE WITH LAW AFT ER GIVING BOTH THE ASSESSEES A REASONABLY OPPORTUNITY OF HEARING. WE O RDER ACCORDINGLY. 7.1 TO ENSURE COMPLIANCE ON BEHALF OF ASSESSEE, WE DIRECT THE ASSESSEE TO APPEAR BEFORE LD. CIT(A) ON 22/1/2014. LD. AR OF THE ASSESSEE HAS DULY NOTED THE SAID DATE AND HE ENSURED THE COMPLIA NCE OF THE DIRECTIONS. 7.2 SINCE WE ARE DISPOSING OF THESE APPEALS ON THE BASIS OF GROUND NO.1, WHICH IS REGARDING NON-GRANT OF OPPORTUNITY OF HEAR ING, WE DO NOT CONSIDER IT NECESSARY TO GO INTO THE OTHER GROUNDS AS BOTH THE APPEALS IN THEIR ENTIRETY ARE BEING RESTORED BACK TO THE FILE OF LD. CIT(A) WITH A DIRECTION TO RE-ADJUDICATE THE SAME AS PER LAW IN T HE MANNER AFORESAID. WE HAVE OBSERVED THAT THE FACTS IN THE INSTANT APPE AL ARE ALMOST SIMILAR AS TO APPEAL IN THE CASE OF RELATIVES OF THE ASSESSEE MRS . RASHMI SAMPAT(SUPRA) AND MR. RAJESH SAMPAT(SUPRA) , AND IN OUR CONSIDERE D VIEW , INTEREST OF JUSTICE WILL BE BEST SERVED IN THE INSTANT APPEAL I F ALL THE MATTER/ISSUES IN THIS APPEAL ARE ALSO SET ASIDE AND RESTORED TO THE FILE OF LEARNED CIT(A) FOR DE-NOVO ADJUDICATION OF THE ISSUES IN THIS APPEAL OF THE A SSESSSEE ON MERITS IN ACCORDANCE WITH LAW. THE ASSESSEE IS DIRECTED TO AP PEAR BEFORE THE LEARNED CIT(A) AND FILE ALL NECESSARY AND RELEVANT EVIDENCE S AND EXPLANATIONS IN SUPPORT OF HER CONTENTION WITH RESPECT TO ALL GROUN DS OF APPEAL RAISED BY THE ITA 1839/MUM/2012 8 ASSESSEE IN THIS APPEAL, WHICH EVIDENCES AND EXPLAN ATIONS SHALL BE ADMITTED BY LEARNED CIT(A) AND ADJUDICATED ON MERITS IN ACCO RDANCE WITH LAW. THE LEARNED CIT(A) SHALL GRANT PROPER AND ADEQUATE OPPO RTUNITY OF BEING HEARD TO THE ASSESSEE IN ACCORDANCE WITH THE PRINCIPLES OF N ATURAL JUSTICE IN ACCORDANCE WITH LAW. WE ORDER ACCORDINGLY. 8. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IN I TA NO. 1839/MUM/2012 IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH SEPTEMBER, 2016. # $% &' 15 -09-2016 ( ) SD/- SD/- (MAHAVIR SINGH) (RAMIT KOCHAR) JUDICIAL MEMBER ACCOUNTANT MEMBER $ MUMBAI ; & DATED 15-09-2016 [ .9../ R.K. R.K. R.K. R.K. , EX. SR. PS !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. : ( ) / THE CIT(A)- CONCERNED, MUMBAI 4. : / CIT- CONCERNED, MUMBAI 5. =>( 99?@ , ?@ , $ / DR, ITAT, MUMBAI A BENCH 6. (BC D / GUARD FILE. / BY ORDER, = 9 //TRUE COPY// / ( DY./ASSTT. REGISTRAR) , $ / ITAT, MUMBAI