I.T.O. 16(2)(4), MUMBAI V. JITENDRA V. MASHRU, MUMBAI

ITA 188/MUM/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 88631 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 2 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-03-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: J
• Next Hearing Date: 26-11-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 07-01-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AKHILENDRA P YADAV
• Assessee Lawyers: MUKESH C BHATT
• Keywords: Unexplained cash credit; Valuation report
• Section: 143(3); 68

Judgement Text

J IN THE INCOME TAX APPELLATE TRIBUNAL J BENCH, MUMBAI BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ./ I.T.A. NO.188 /MUM/2013 ( / ASSESSMENT YEAR : 2008-2009 INCOME TAX OFFICER 16(2)(4), 2 ND FLOOR, MATRU MANDIR, TARDEO ROAD, MUMBAI 400 007. / VS. MR. JITENDRA MASHRU, 42-A, SAI KRUPA BLDG., FORJJET STREET GOWALIA TANK, MUMBAI 400 036. . / PAN : AAHPM1380N ( / APPELLANT ) .. ( / RESPONDENT ) A PPELLANT BY SHRI AKHILENDRA P. YADAV R E SPONDENT BY : SHRI MUKESH C BHATT / DATE OF HEARING : 11-03-2015 / DATE OF PRONOUNCEMENT : 18-03-2015 [ !' / O R D E R PER R.C. SHARMA, A.M . : THIS IS AN APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST THE ORDER PASSED BY THE LD. CIT(A) - 27, MUMBAI DATED 10-10- 2012 FOR THE A.Y. 2008-09 IN THE MATTER OF ORDER PASSED U/S 143(3) OF THE INC OME TAX ACT, 1961 WHEREIN FOLLOWING GROUND HAS BEEN TAKEN BY THE REVENUE:- ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS. 15,80,000/- AS UNEX PLAINED CASH CREDITS U/S 68 OF THE ACT. 2. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PE RUSED. FACTS IN BRIEF ARE THAT AS PER THE AIR INFORMATION/ITS DETAILS AVA ILABLE ON RECORD, DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAS DEPOSITE D CASH OF RS. ITA 188/M/13 2 15,80,000/- IN HIS SAVINGS BANK ACCOUNT WITH BANK O F BARODA, GOWALIA TANK BRANCH, MUMBAI, ON DIFFERENT DATES. DURING THE ASSE SSMENT PROCEEDINGS, THE AO. HAS CALLED THE ASSESSEE TO EXPLAIN THE SOURCES OF THE AFORESAID CASH DEPOSITS. VIDE THE LETTER DATED 24-12-2010 FILED BE FORE THE A.O., ASSESSEE SUBMITTED THAT THE SOURCE OF THE CASH DEPOSITS WAS OUT OF SALE PROCEEDS OF THE JEWELLERY DECLARED BY THE ASSESSEE UNDER VDIS, 1997 . ASSESSEE HAS FILED COPY OF THE SAID DECLARATION, A COPY OF VALUATION REPORT OF THE GOVERNMENT APPROVED VALUER, COPY OF THE CERTIFICATE U/S. 68(2) OF VDIS ACT, 1997 AND ALSO PHOTOCOPIES OF THE PURCHASE BILLS FROM JEWELERS IN RESPECT OF IMPUGNED SALE OF JEWELLERY ETC., BEFORE THE AO. HOWEVER, THE A.O. RE JECTED THE ASSESSEES EXPLANATION ON THE GROUND THAT ASSESSEE WAS NOT RES PONDING TO THE OPPORTUNITIES GIVEN EARLIER AND HAS COME UP WITH AN EXPLANATION AT THE FAG END OF THE ASSESSMENT PROCEEDINGS ONLY WITH AN ULTE RIOR MOTIVE AND THEREFORE, THE EXPLANATION OFFERED IS AN AFTERTHOUGHT AND MANI PULATED. THE AO ALSO OBSERVED THAT ASSESSEE FAILED TO SHOW ANY LONG TERM CAPITAL GAINS ARISING ON THE ALLEGED SALE OF JEWELLERY. ACCORDINGLY, THE A.O . REJECTED THE ASSESSEES EXPLANATION AND TREATED THE CASH RECEIPTS OF RS. 15 ,80,000/- AS ASSESSEES INCOME U/S. 68 OF THE ACT. BY THE IMPUGNED ORDER, T HE LD. CIT(A) DELETED THE ADDITION AFTER HAVING FOLLOWING OBSERVATION:- 5. I HAVE CAREFULLY CONSIDERED THE CONTENTS OF THE ASSESSMENT ORDER, APPELLANT'S SUBMISSIONS, CONTENTS OF THE REMAND REP ORT AND THE APPELLANT'S REJOINDER THEREON. AT THE OUTSET, THE M ATERIALS PLACED ON THE PAPER BOOK WERE FURNISHED TO THE A.O. DURING THE AS SESSMENT PROCEEDINGS AND THE AO. WHO PASSED THE ASSESSMENT O RDER HAS REJECTED THEM MERELY ON THE GROUND THAT THE SAME WERE FURNIS HED AT THE FAG END OF THE ASSESSMENT PROCEEDINGS. THE AO. WAS GIVEN FU RTHER OPPORTUNITY TO EXAMINE THE SAME DURING THE REMAND PROCEEDINGS. HOWEVER, AT BOTH THE INSTANCES, THE AO. HAS COMMENTED UPON THE APPEL LANT'S INTENTIONS RATHER THAN EXAMINING THE MATERIALS PLACED BEFORE H IM AND TO FIND OUT THE TRUTH. FROM THE MATERIALS PLACED ON RECORD, I N OTE THAT, AT THE OUTSET, THE FACT OF THE APPELLANT OWNING THE IMPUGN ED JEWELLERY AND ITS VALUE SHOWN AS ON 01-04-1987, IS WELL ESTABLISHED B Y VDIS DECLARATION AND THE CERTIFICATE U/S. 68(2) OF VDIS, 1997. SECON DLY, THE BILLS ISSUED BY M/S. JAIN ENTERPRISES ARE PURCHASE BILLS AND APP ARENTLY THERE WAS A PRINTING MISTAKE IN THE BILLS SHOWING THE PURCHASER 'S NAME INSTEAD OF ITA 188/M/13 3 SHOWING IT AS SELLER'S NAME. SINCE ALL THE OTHER RE LEVANT DETAILS WERE FILLED IN PROPERLY AND CONFIRMATION WAS ALSO ISSUED BY M/S. JAIN ENTERPRISES, IN RESPECT OF PURCHASING JEWELLERY FRO M THE APPELLANT, A SMALL PRINTING ERROR IN THE BILL BOOKS CANNOT BE BL OWN OUT OF PROPORTION. FURTHER, THE IMPUGNED TRANSACTION RESULTED IN LONG TERM CAPITAL LOSS AS WORKED OUT AT PAGE 23 OF THE PAPER BOOK AND, THEREF ORE, THE AO'S OBSERVATION THAT APPELLANT HAS NOT FURNISHED ANY SU CH STATEMENT IS NOT CORRECT. IN MY CONSIDERED OPINION, THE APPELLANT HA S DISCHARGED THE ONUS CAST UPON HIM U/S. 68 OF THE ACT BY FURNISHING NECESSARY DETAILS BEFORE THE AO. AT THE TIME OF ASSESSMENT PROCEEDING S AND ALSO AT THE TIME OF REMAND PROCEEDINGS. THE AO. HAS NOT EXAMINE D THE DETAILS PLACED BEFORE HIM AND HAS CHOSEN NOT TO AVAIL OF TH E OPPORTUNITY GIVEN TO HIM DURING THE REMAND PROCEEDINGS IN THIS REGARD . AS STATED EARLIER, THE AO. HAS MERELY COMMENTED UPON THE PERIPHERAL FE ATURES OF THE MATERIALS PRODUCED INSTEAD OF GOING IN DEPTH INTO T HE SAME, IN CASE HE HAS DOUBTED THE GENUINENESS. THERE IS NO MATERIAL B ROUGHT ON RECORD BY THE AO. TO PROVE THAT THE EXPLANATION OFFERED BY THE APPELLANT IN TERMS OF VDIS DECLARATION OF THE JEWELLERY AND ITS SUBSEQUENT SALE IS FALSE. IN VIEW OF THE ABOVE DISCUSSION, I AM OF THE CONSIDERED OPINION THAT THE APPELLANT HAS DISCHARGED THE ONUS CAST UPO N HIM IN TERMS OF SECTION 68 OF THE ACT AND THEREFORE, THE CASH DEPOS ITS IN HIS BANK ACCOUNT STAND EXPLAINED IN THE ABSENCE OF ANY CONCR ETE EVIDENCE BROUGHT ON RECORD BY THE AO. TO THE CONTRARY. ACCOR DINGLY, THE ADDITION MADE BY THE AO. IS DELETED AND THE APPEAL IS ALLOWE D. 3. AGAINST THE ABOVE ORDER OF LD. CIT(A), THE REVEN UE IS IN APPEAL BEFORE US. 4. WE HAVE CONSIDERED THE RIVAL CONTENTIONS, CAREFU LLY GONE THROUGH THE ORDERS OF AUTHORITIES BELOW AND FOUND FROM THE RECO RD THAT THE JEWELLERY OWNED BY THE ASSESSEE WAS DISCLOSED IN THE VDIS DEC LARATION FILED IN THE YEAR 1997. THE ASSESSEE HAS FILED THE BILLS ISSUED BY M /S JAIN ENTERPRISES FOR SALE OF JEWELLERY ALONG WITH CONFIRMATION ISSUED BY M/S JAIN ENTERPRISES IN RESPECT OF PURCHASE OF JEWELLERY FROM THE ASSESSEE. THE TR ANSACTIONS OF SALE RESULTED INTO LONG TERM CAPITAL LOSS. THE A.O. HAS NOT EXAMI NED THE DETAILS PLACED BEFORE HIM AND HAS CHOSEN NOT TO AVAIL OF THE OPPOR TUNITY GIVEN TO HIM EVEN DURING THE REMAND PROCEEDINGS. THE LD. CIT(A) ALSO OBSERVED THAT NO MATERIAL BROUGHT ON RECORD BY THE A.O. TO PROVE THAT THE EXP LANATION OFFERED BY THE ASSESSEE IN TERMS OF VDIS DECLARATION OF THE JEWELL ERY AND ITS SUBSEQUENT SALE IS FALSE. THE DETAILED FINDING RECORDED BY THE LD. CIT(A) AT PARA 5 OF HIS ORDER HAS NOT BEEN CONTROVERTED BY LD. D.R. BY BRINGING A NY NEW MATERIAL ON RECORD. ITA 188/M/13 4 ACCORDINGLY, WE DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF LD. CIT(A) RESULTED INTO DELETION OF ADDITION OF RS. 15,80,000 /- MADE ON ACCOUNT OF UNEXPLAINED CASH CREDITS U/S 68 OF THE ACT. 5. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 18 TH MARCH, 2015. !' # $% &! ' 18-03-2015. ( ) SD/- SD/- (I.P. BANSAL) (R.C. SHARMA) JUDICIAL MEMBER ACCOUNTANT MEMBER $ 5 MUMBAI ; &! DATED 18-03-2015 [ .6../ RK , SR. PS ! '#$% &%# / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. 7 () / THE CIT(A) 27, MUMBAI 4. 7 / CIT 16, MUMBAI 5. :;( 66<= , <= , $ 5 / DR, ITAT, MUMBAI J BENCH 6. (?@ A / GUARD FILE. ' / BY ORDER, : 6 //TRUE COPY// (/') * ( DY./ASSTT. REGISTRAR) , $ 5 / ITAT, MUMBAI