Patel Hirubhai Purshottamdas,HUF, Ahmedabad V. ITO, Ward-3, Mehsana

ITA 2098/AHD/2018

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 3864 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 11 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-10-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 09-10-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R R MAKWANA
• Assessee Lawyers: SURESH R SHAH
• Keywords: Reopening of assessment; Set aside
• Section: 142(1); 22; 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD SMC BENCH (CONDUCTED THROUGH VIRTUAL COURT) BEFORE: SHRI AMARJIT SINGH, ACCOUNTANT MEMBER AND MS. MADHUMITA ROY, JUDICIAL MEMBER PATEL HIRUBHAI PURSHOTTAMDAS HUF C/O SURESH R. SHAH & ASSOCIATES, F.F. GHANSYAM CHAMBERS, OPP. MITHAKHALI RLY CROSSING, ELLISBRIDGE, AHMEDABAD-06 PAN: AABHP6416L (APPELLANT) VS THE ITO, WARD-3, MEHSANA (RESPONDENT) REVENUE BY: SHRI R.R. MAKWANA, SR. D.R. ASSESSEE BY: SHRI SURESH R. SHAH, A .R. DATE OF HEARING : 29-09-2021 DATE OF PRONOUNCEMENT : 07-10-20 21 /ORDER PER : AMARJIT SINGH, ACCOUNTANT MEMBER:- THIS ASSESSEES APPEAL FOR A.Y. 2010-11, ARISES FRO M ORDER OF THE CIT(A), GANDHINAGAR, AHMEDABAD DATED 12-07-2018, I N PROCEEDINGS UNDER SECTION 144 R.W.S. 147 OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. ITA NO. 2098/AHD/2018 ASSESSMENT YEAR 2010-11 I.T.A NO. 2098/AHD/2018 A.Y. 2010-11 PAGE NO PATEL HIRUBHAI PURSHOTTAMDAS HUF 2 2. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APP EAL:- THE LEARNED A.O. ERRED IN PASSING AN ORDER U/S, 14 4 R.W.S. 147 DATED 18- 12-2017 AND LEARNED C.I.T. (A) G.N.R. ALSO ERRED IN CONFIRMING THE SAID ORDER. YOUR APPELLANT SUBMITS THAT ON THE FACTS OF THE CAS E THE ASSESSMENT ORDER PASSED U/S. 144 R.W.S. 147 DATED 18-12 -2017 IS I ARBITRARY, UNWARRANTED AND BAD IN LAW AND THE SAME SHOULD BE C ANCELLED. THE LEARNED A.O. ERRED IN REOPENING THE ASSESSMENT BY ISSUE OF NOTICE U/S. 148 DATED 31-03-2017. YOUR APPELLANT SUBMITS THAT N O NOTICE U/S. 148 DATED 31- 03-2017 WAS SERVED UPON H.U.F. OR ITS LIVING MEMBER S OF H.U.F. YOUR APPELLANT SUBMITS THAT IN ABSENCE OF PROPER SERVICE OF NOTICE U/S, 148 DATED 31-03-2017, THE REOPENING OF ASSESSMENT U/S. 148 AND PASSING THE OR DER U/S. 144 R.W.S. 147 DATED 18-12-2017 IS BAD IN LAW AND THE SAME SHOULD BE CAN CELLED. WITHOUT PREJUDICE TO ABOVE YOUR APPELLANT SUBMITS T HAT THE LEARNED A.O. ERRED IN HOLDING THAT THE NOTICES U/S. 142(1) AND 1 44 WERE ISSUED AND SERVED AND THE SAME WERE NOT COMPLIED AND LEARNED C.I.T. (A) A LSO ERRED IN CONFIRMING THE SAME. YOUR APPELLANT SUBMITS THAT ON THE FACTS OF T HE CASE THE ABOVE NOTICES WERE NOT SERVED AS PER THE PROVISIONS OF I.T. LAW ON APP ELLANT H.U.F. OR ITS LIVING MEMBERS. IN ABSENCE OF SUCH PROPER SERVICE OF ABOVE NOTICES, THE ASSESSMENT ORDER PASSED U/S. 144 R.W.S. 147 AND CONFIRMED BY L EARNED C.I.T.(A) IS BAD IN LAW AND SAME SHOULD BE CANCELLED. WITHOUT PREJUDICE TO ABOVE YOUR APPELLANT SUBMITS T HAT THE LEARNED A.O. IS NOT JUSTIFIED IN MAKING THE ADDITION OF RS. 5,15,80 0/- U/S. 69 AND UNEXPLAINED CASH DEPOSIT OF RS. 84,070/- AND LEARNED C.I.T.(A) ERRED IN CONFIRMING THE SAME. YOUR APPELLANT SUBMITS THAT ON THE FACTS OF THE CASE THE LEARNED A.O. IS NOT JUSTIFIED IN MAKING THE SAID ADDITION. YOUR APPELLANT SUBMITS TH AT IT BE SO DELETED NOW. 3. ALL THE GROUNDS OF APPEAL OF THE ASSESSEE ARE IN TER-CONNECTED, THEREFORE, FOR THE SAKE OF CONVENIENCE THESE ARE AD JUDICATED TOGETHER AS FOLLOWS:- 4. THE FACT IN BRIEF IS THAT ASSESSEE HAS NOT FILED ANY RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION. THE ASSESSING OFFICE R HAS STATED THAT THERE WAS INFORMATION WITH THE DEPARTMENT THAT ASSESSEE H AS PAID RS. 3,50,000/- ON 22 ND JULY, 2009 FOR PURCHASE OF UTI M.F. THEREFORE, ASS ESSMENT WAS REOPENED BY ISSUING OF NOTICE U/S. 148 OF THE ACT O N 31 ST MARCH, 2017. THE ASSESSING OFFICER STATED THAT A NUMBER OF NOTICES W ERE ISSUED TO THE ASSESSEE I.T.A NO. 2098/AHD/2018 A.Y. 2010-11 PAGE NO PATEL HIRUBHAI PURSHOTTAMDAS HUF 3 TO MAKE COMPLIANCE DURING THE COURSE OF ASSESSMENT PROCEEDINGS, HOWEVER, NO RESPONSE HAS BEEN MADE BY THE ASSESSEE. THEREFO RE, ON THE BASIS OF MATERIAL ON RECORD, THE TOTAL INCOME OF THE ASSESSE E WAS ASSESSED AT RS. 6,03,140/- AFTER MAKING ADDITION ON ACCOUNT OF UNEX PLAINED INVESTMENT OF RS. 5,15,800/- IN UTI MF, UNEXPLAINED CASH DEPOSIT OF RS. 84,077/- FOUND IN THE BANK ACCOUNT ALONG WITH INTEREST OF RS. 327/ - RECEIVED BY THE ASSESSEE. 5. THE ASSESSEE HAS FILED APPEAL BEFORE THE LD. CIT (A). THE LD. CIT(A) HAS DISMISSED THE APPEAL OF THE ASSESSEE OF THE ASS ESSEE. 6. DURING THE COURSE OF APPELLATE PROCEEDINGS BEFOR E US, THE LD. COUNSEL HAS VEHEMENTLY CONTENDED THAT PROPER SERVICE OF NOT ICE HAS NOT BEEN EFFECTED U/S. 148 UPON THE ASSESSEE SINCE AT THE GIVEN RESID ENTIAL ADDRESS NO MEMBER OF THE HUF WAS RESIDING AFTER THE DEATH OF THE KAR TA OF THE HUF AND THE WIFE OF THE KARTA. THE TWO SONS WHO WERE MEMBERS OF THE HUF WERE LIVING IN USA. THEREFORE, NOTICE HAS NOT BEEN SERVED ON T HE LIVING MEMBER OF THE HUF AND CONTENDED THAT ASSESSMENT ORDER MADE U/S. 1 44 OF THE ACT SHOULD BE CANCELLED. THE LD. COUNSEL HAS ALSO FILED PAPER BOO K COMPRISING DETAIL OF SUBMISSION MADE BEFORE THE CIT(A) AND COPIES OF BAN K PASSBOOK OF THE ASSESSEE. ON THE OTHER HAND, LD. DEPARTMENTAL REP RESENTATIVE CONTENDED THAT NOTICES PERTAINED TO THE ASSESSMENT PROCEEDING S WERE ISSUED AT THE ADDRESS GIVEN BY THE ASSESSEE AND ASSESSEE HAS NOT UPDATED THE ADDRESS FOR COMMUNICATION. 7. HEARD BOTH THE SIDES AND PERUSED THE MATERIAL ON RECORD. WITHOUT REITERATING THE FACTS AS ELABORATED ABOVE, ASSESSME NT IN THE CASE OF THE I.T.A NO. 2098/AHD/2018 A.Y. 2010-11 PAGE NO PATEL HIRUBHAI PURSHOTTAMDAS HUF 4 ASSESSEE WAS MADE EX-PARTE U/S. 144 R.W.S. 147 OF T HE ACT AS NO COMPLIANCE WAS MADE DURING THE COURSE OF ASSESSMENT IN SPITE O F ISSUING A NUMBER OF NOTICES. THE ASSESSEE HAS CONTENDED THAT NOTICE U/ S. 148 DATED 31 ST MARCH, 2017 WAS NOT SERVED UPON LIVING MEMBER OF THE HUF A ND THE ADDITION MADE BY THE ASSESSING OFFICER WAS UNJUSTIFIED. IT IS U NDISPUTED FACT THAT NOTICE U/S. 148 OF THE ACT WAS SERVED ON THE ADDRESS AVAIL ABLE WITH THE ASSESSING OFFICER. THE ASSESSEE HAS NOT COMMUNICATED ANY ALT ERNATIVE ADDRESS AS PROVIDED IN RULE 127 OF THE I.T. RULE, 1962. THERE FORE, NOTICE WAS SERVED ON THE ADDRESS FOR COMMUNICATION AVAILABLE WITH THE IN COME TAX DEPARTMENT AS LAID DOWN IN THE RULE 127 OF THE I.T. RULE, 1962. SINCE NO ONE WAS ON BEHALF OF THE ASSESSEE WAS AVAILABLE AT THE GIVEN ADDRESS, THEREFORE, NOTICE WAS SERVED BY AFFIXTURE ACCORDING TO THE PROVISION OF S UB-SECTION (1) OF SECTION 282 OF THE INCOME TAX ACT, 1961. IN THE LIGHT OF T HE ABOVE FACTS AND FINDINGS, WE DO NOT FIND ANY INFIRMITY ON THIS ISSU E IN THE ORDER OF LD. CIT(A) THAT ASSESSING OFFICER HAS SERVED THE NOTICE BY AFF IXTURE ON THE LAST KNOWN ADDRESS OF THE ASSESSEE. THEREFORE, THIS GROUND OF APPEAL OF THE ASSESSEE STANDS DISMISSED. 8. REGARDING THE ISSUE OF MERIT OF ADDITIONS MADE B Y THE ASSESSING OFFICER EX-PARTE U/S. 144 AND TIME LIMIT FOR ISSUIN G OF NOTICE U/S. 148 OF THE ACT, IT IS OBSERVED DURING THE COURSE OF ASSESSME NT THESE ISSUES COULD NOT BE ADDRESSED BECAUSE OF NON-COMPLIANCE OF THE ASSES SEE ON ACCOUNT OF REASON BEYOND THE CONTROL OF THE ASSESSEE AS BOTH THE MEMBERS OF THE HUF WERE RESIDING AT USA. IN THE INTEREST OF JUSTICE, WE OPINED THAT IT WOULD BE APPROPRIATE TO RESTORE THE ISSUE OF TIME LIMIT FOR ISSUING NOTICE TO THE FILE OF THE ASSESSING OFFICER TO RESOLVE AFTER VERIFICATION IN ACCORDANCE TO THE I.T.A NO. 2098/AHD/2018 A.Y. 2010-11 PAGE NO PATEL HIRUBHAI PURSHOTTAMDAS HUF 5 PROVISION OF SECTION 149 OF THE ACT. WE ALSO SET ASIDE IMPUGNED ADDITIONS MADE BY THE ASSESSING OFFICER TO THE FILE OF THE A SSESSING OFFICER FOR DECIDING DE-NOVO AFTER VERIFICATION OF THE SUBMISSI ON TO BE MADE BY THE ASSESSEE DURING THE COURSE OF SET ASIDE PROCEEDINGS UPON GRANTING REASONABLE OPPORTUNITIES TO THE ASSESSEE. THE ASSESSEE IS A LSO DIRECTED TO COMMUNICATE IF THERE IS ANY OTHER ALTERNATIVE ADDRESS TO THE AS SESSING OFFICER DURING THE COURSE OF SET ASIDE ASSESSMENT PROCEEDINGS. ACCORD INGLY, THIS APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 07-10-2021 SD/- SD/- (MADHUMITA ROY) (AMARJIT SINGH) JUDICIAL MEMBER A CCOUNTANT MEMBER AHMEDABAD : DATED 07/10/2021 / COPY OF ORDER FORWARDED TO:- 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,