KIRAN R. MEHTA, MUMBAI V. ITO 32(2)(2), MUMBAI

ITA 2250/MUM/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 8015 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-02-2017
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Next Hearing Date: 18-01-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 17-04-2015
• Court: TRIBUNAL
• Department Lawyers: SAMBIT MISHRA
• Section: 131

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL J BENCH, MUMBAI BEFORE SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER AND SHRI PAWAN SINGH, JUDICIAL MEMBER ITA NO.225 0/M/2015 (AY 2010 - 2011) KIRAN R MEHTA, PLOT NO.82, S.V. ROAD, 5 TH FLOOR, KAILASH APARTMENT, NO.3, BORIVALI (W), MUMBAI 400092. / VS. ITO - 32(2)(2), C - 11, 6 TH FLOOR, PRATYAKSHKAR BHAVAN, BKC BANDRA (E), MUMBAI 400 051. ./ PAN : AACPM7558H ( / APPELLANT) .. ( / RESPONDENT ) / APPELLANT BY : SHRI MANDAR VAIDYA / RESPONDENT BY : SHRI SAMBIT MISHRA / DATE OF HEARING : 15 .02.2017 / DATE OF PRONOUNCEMENT : 28 .02.2017 / O R D E R PER D. KARUNAKARA RAO, AM: THIS APPEAL FILED BY THE ASSESSEE ON 17.4.2015 IS AGAINST THE ORDER OF THE CIT (A) - 44, MUMBAI DATED 20.2.2015 FOR THE ASSESSMENT YEAR 2010 - 2011. 2. IN THIS APPEAL, ASSESSEE RAISED SIX GROUNDS IN TOTO AND THEY REVOLVE AROUND COUPLE OF ISSUES IE (I) REGARDING THE ADDITION INVOLVING M/S. DIVYA TEJ CORPORATION, A LOAN CREDITOR AND (II) ADDITION ON ACCOUNT OF ANOTHER LOAN CREDITOR NAMED M/S. SUNRISE ENTERPRISE. 3. IN CONNECTION WITH THE FIRST ISSUE IE LOAN CREDIT INVOLVING THE SAID M/S. DIVYA TEJ CORPORATION, LD COUNSEL FOR THE ASSESSEE MENTIONED, IDENTICAL ADDITION WAS THE SUBJECT MATTER OF ADJUDICATION BEFORE THE TRIBUNAL VIDE ITA NO.3884/M/2010 FOR THE AY 2007 - 2008. BRINGING OUR ATTENTION TO PARA 3 .4 OF THE SAID ORDER OF THE TRIBUNAL (SUPRA), LD COUNSEL FOR THE ASSESSEE SUBMITTED THAT THIS ISSUE MAY BE REMANDED TO THE FILE OF THE AO FOR FRESH ADJUDICATION IN THE LINES ALREADY MENTIONED BY THE TRIBUNAL (SUPRA) IN THE SAID PARA 3.4 OF ITS ORDER . CONS IDERING THE SIGNIFICANCE AND FOR THE SAKE OF COMPLETENESS OF THIS ORDER, THE SAID PARA 3.4 OF THE TRIBUNALS ORDER (SUPRA) IS EXTRACTED AS UNDER: - 3.4. WE HAVE CONSIDERED THE SUBMISSIONS MADE BY THE LD REPRESENTATIVES OF THE PARTIES. WE ARE IN AGREEMENT WITH THE FINDING OF THE CIT (A) THAT THE AO COULD NOT 2 HAVE MADE THE ABOVE MENTIONED ADDITIONS WITHOUT MAKING PROPER INQUIRIES TO SATISFY HIMSELF REGARDING THE GENUINENESS OF THE CREDITORS ETC. THE AO FIRSTLY SHOULD HAVE ASKED THE ASSESSEE TO FURNISH THE R EQUIRED DETAILS SUCH AS PAN NUMBER ETC OF THE CREDITORS AND SECONDLY HE HIMSELF COULD HAVE SUMMONED THE RECORDS AND IN CASE OF NEED THE CREDITORS BY ISSUING SUMMONS UNDER SECTION 131 OF THE INCOME TAX ACT. ADMITTEDLY NO SUCH COURSE WAS ADOPTED BY THE AO. HENCE IN OUR VIEW THE LD CIT (A) HAS RIGHTLY RESTORED THE ISSUE TO THE FILE OF THE AO WITH LIBERTY TO THE AO TO MAKE NECESSARY INQUIRIES ABOUT THE CREDITWORTHINESS ETC OF THE CREDITORS BY MAKING RESORT TO THE PROVISIONS OF THE IT ACT IN THIS RESPECT, IN A CCORDANCE WITH LAW AND DECIDE THE ISSUE ACCORDINGLY. 4. CONSIDERING ABOVE SETTLED NATURE OF THE ISSUE AND IN THE ABSENCE OF ANY CONTROVERSY ON THE ISSUE OF REMANDING FROM THE LD DRS SIDE, WE SET ASIDE THE RELEVANT GROUND TO THE FILE OF THE AO FOR FRESH A DJUDICATION WITH IDENTICAL DIRECTIONS. ACCORDINGLY, RELEVANT GROUNDS ARE ALLOWED FOR STATISTICAL PURPOSES. 5. REGARDING THE SECOND ISSUE RELATING TO THE ADDITION INVOLVING LOAN CREDIT OF M/S. SUNRISE ENTERPRISE, IT IS THE ARGUMENT OF THE LD AR FOR THE ASS ESSEE THAT THE AO PROCEEDED TO MAKE ENTIRE LOAN AS AN ADDITION IGNORING THE FACT THAT PART OF THE LOAN WAS ALREADY REPAID BY THE ASSESSEE TO THE CREDITOR IN THE SAME ASSESSMENT YEAR. IN THE REGARD, LD AR RELIED ON THE DECISION OF THE ITAT, DELHI IN THE CA SE OF ITO VS. SHYAM SUNDER JAJODIA IN ITA NO. 4549/DEL/2004 (2008) 26 SOT 541. A FTER HEARING THE LD REPRESENTATIVES OF BOTH THE PARTIES AND ON PERUSAL OF THE ORDERS OF THE REVENUE AUTHORITIES ON THIS ISSUE , WE ARE OF THE VIEW THAT THIS ISSUE SHOULD ALSO B E REMA NDED TO THE FILE OF THE AO WITH A DIRECTION THAT WHEN THE ASSESSEE DONE REPAYMENT OF THE LOAN, AS TO WHY SUCH LOAN CAN BECOME SUBJECT MATTER OF ADDITION. IF THE LOAN IS REPAID THROUGH BANKING CHANNELS, THERE IS EVERY CHANCE THAT IDENTITY AND THE CRE DITWORTHINESS RELATED ISSUES CAN BE FACTUALLY ESTABLISHED WITH INVESTIGATION / VERIFICATION BY THE AO. THEREFORE, WE ARE OF THE OPINION, THIS ISSUE MUST ALSO BE REMANDED TO THE FILE OF THE AO FOR FRESH ADJUDICATION AND DECISION IN ACCORDANCE WITH THE LAW IN FORCE. ACCORDINGLY, RELEVANT GROUND S RAISED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUN CED IN THE OPEN COURT ON 2 8 T H FEBRUARY, 2017. S D / - S D / - (PAWAN SINGH) (D. KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; 28.02.2017 3 . . ./ OKK , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI