M/S. SHAKUN J. MULCHANDANI, MUMBAI V. THE ACIT (OSD-II) CEN CIR-7, MUMBAI

ITA 2389/MUM/2008

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 7862 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-02-2010
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: E
• Next Hearing Date: 11-01-2010
• Assessment Year: 2002-2003
• Appeal Filed On: 07-04-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: KISHAN VYAS
• Assessee Lawyers: M SUBRAMANIAN
• Keywords: Opportunity of being heard; Block assessment
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH E : MUMBAI BEFORE SHRI D.K. AGARWAL, (JM) AND SHRI RAJENDRA SINGH ,(AM) ITA NO.2389/MUM/2008 ASSESSMENT YEAR : 2002-03 MS. SHAKUN J. MULCHANDANI C/O., M.V. DAMANIA & CO. UNIT NO.14, 2 ND FLOOR MAHALAXMI INDL. ESTATE GANDHI NAGAR, LOWER PAREL MUMBAI-400 013. ..( APPELLANT ) P.A. NO. (AAGPM 7092 N) VS. DY. COMMISSIONER OF INCOME TAX (OSD-II) CENTRAL RANGE- 7 MUMBAI. ..( RESPONDENT ) APPELLANT BY : SHRI M. SUBRAMANIAN RESPONDENT BY : SHR I KISHAN VYAS O R D E R PER D.K. AGARWAL (JM). THIS APPEAL PREFERRED BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER DATED 6.12.2007 PASSED BY THE LD. CIT(A) FOR TH E ASSESSMENT YEAR 2002-03 CONFIRMING THE PENALTY OF RS.973294 IMPO SED BY THE AO U/S.271(1)(C) OF THE IT ACT, 1961 (THE ACT). ITA NO.2389/M/08 A.Y: 02-03 2 2. WE HAVE CAREFULLY HEARD SHRI M. SUBRAMANIAN, LD. COUNSEL FOR THE ASSESSEE AND SHRI KISHAN VYAS, LD. DR. 3. WE FIND THAT THE ASSESSEE IS A DIRECTOR OF BARON INTER NATIONAL LTD., AND HAD FILED RETURN OF INCOME DECLARING AN IN COME OF RS.19,17,500/-. HOWEVER, THE ASSESSMENT WAS MADE AT AN IN COME OF RS.1,02,10,100/-. ON APPEAL, THE LD. CIT(A) PARTLY ALLOWED THE APPEAL SUSTAINING THE ADDITION OF INTEREST ON LOAN AND ADVAN CES RS.24,79,800/- AND UNEXPLAINED DEPOSITS IN BANK ACCOUNT AMOUNTING TO RS.6,99,878/-. WE FURTHER FIND THAT THE AO HAS IM POSED PENALTY ON THE REVISED TOTAL INCOME OF RS.50,98,200/- DETERMINED AFTER GIVING EFFECT TO THE ORDER OF THE LD. CIT(A) AND FINDING RE CORDED IN THE ASSESSMENT PROCEEDING AS THERE WAS NO COMPLIANCE BY THE ASSE SSEE IN RESPONSE TO THE ASSESSING OFFICERS LETTER DATED 20.11.2 006. ACCORDINGLY THE AO WAS OF THE VIEW THAT THE ASSESSEE HAS N O EXPLANATION TO OFFER AND HENCE HE IMPOSED A PENALTY O F RS.9,73,294/- VIDE ORDER DT.23.3.2007 PASSED U/S.271(1)(C) OF THE ACT . ON APPEAL, THE LD. CIT(A) UPHELD THE PENALTY IMPOSED BY THE AO. AT THE TIME OF HEARING IT IS OBSERVED THAT IN THE QUANTUM APPEAL THE TRIBUNAL IN THE ASSESSEES OWN CASE IN SHAKUN J. MULCHANDANI VS. ACIT AND VICE- VERSA IN ITA NO.2948 AND 3911/MUM/2006 FOR ASSESSMENT Y EAR 2002-03 DT.6.1.2010 HAS SET ASIDE THE MATTER TO THE FI LE OF THE AO VIDE PARA-5 OF THE ORDER WHICH IS REPRODUCED UNDER : ITA NO.2389/M/08 A.Y: 02-03 3 5. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AND ALSO PERUSED THE RELEVANT MATERIAL ON REC ORD. IT IS OBSERVED THAT IN ASSESSEES OWN CASE FOR ASSESSM ENT YEAR 1999-2000, ASSESSMENT WAS SIMILARLY MADE BY TH E ASSESSING OFFICER EX-PARTE U/S 144 TO THE BEST OF HIS JUDGMENT AND ON APPEAL, THE LEARNED CIT (A) ALLOWED PART RELIEF TO THE ASSESSEE, WHICH RESULTED IN FILI NG OF THE APPEALS BY THE REVENUE AS WELL AS BY THE ASSESSEE B EFORE THE TRIBUNAL AGAINST THE ORDER OF LEARNED CIT (A). DURING THE COURSE OF HEARING BEFORE THE TRIBUNAL, THE LEAR NED REPRESENTATIVES OF BOTH THE SIDES AGREED THAT KEEPI NG IN VIEW THE EX-PARTE ORDER PASSED BY THE ASSESSING OFFICER U/S 144 AND IN THE INTEREST OF JUSTICE, THE MATTER SHOULD BE RESTORED TO THE FILE OF THE ASSESSING OFFICER FO R COMPLETING THE ASSESSMENT AFRESH. ACCORDINGLY, THE MATTER WAS RESTORED BY THE TRIBUNAL TO THE FILE OF THE ASSESSING OFFICER VIDE ITS ORDER DATED 11.9.2009 PA SSED IN ITA NOS. 2435 AND 2322/M/2006 WITH A DIRECTION TO H IM TO EXAMINE AFRESH THE ISSUES INVOLVED IN THE CASE O F THE ASSESSEE FOR ASSESSMENT YEAR 1999-2000 AFTER AFFORD ING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESS EE. AS AGREED BY THE LEARNED REPRESENTATIVES OF BOTH TH E SIDES BEFORE US, THE FACTS INVOLVED IN THE YEAR UND ER CONSIDERATION ARE MATERIALLY SIMILAR TO THAT OF ASS ESSMENT YEAR 1999-2000. MOREOVER, IT APPEARS FROM THE IMPUGNED ORDER OF LEARNED CIT (A) THAT MANY OF THE ISSUES INVOLVED IN THE APPEALS OF THE ASSESSEE FILE D BEFORE HIM WERE DECIDED BY HIM RELYING ON THE ORDER OF LEA RNED CIT (A) PASSED WHILE DISPOSING OFF THE APPEAL FILED BY THE ASSESSEE AGAINST THE BLOCK ASSESSMENT MADE U/S 158B C. AS RIGHTLY SUBMITTED BY LEARNED DEPARTMENTAL REPRESENTATIVE, THE FURTHER DEVELOPMENT IN THE FORM OF TRIBUNALS ORDER, IF ANY, PASSED IN RELATION TO BLO CK ASSESSMENT PROCEEDINGS, THEREFORE, MAY ALSO BE RELE VANT TO DECIDE THE ISSUES INVOLVED IN THE PRESENT APPEAL S, WHICH THE ASSESSING OFFICER WOULD BE IN A POSITION TO TAKE INTO CONSIDERATION. WE, THEREFORE, FIND IT FAIR AN D PROPER AND IN THE INTEREST OF JUSTICE TO SET ASIDE IMPUGNE D ORDER OF CIT (A) AND RESTORE THE MATTER TO THE FILE OF TH E ASSESSING OFFICER WITH A DIRECTION TO CONSIDER AND DECIDE THE ISSUES INVOLVED IN THE CASE OF THE ASSESSEE AFR ESH AFTER AFFORDING A REASONABLE OPPORTUNITY OF BEING H EARD TO THE ASSESSEE. ITA NO.2389/M/08 A.Y: 02-03 4 IN THE ABSENCE OF ANY DISTINGUISHING FEATURE BROUGHT O N RECORD BY THE REVENUE AND RESPECTFULLY FOLLOWING THE ORDER OF THE TRIBUNAL SUPRA, WE ARE OF THE VIEW THAT IN THE INTEREST OF JUSTICE THE MA TTER SHOULD GO BACK TO THE FILE OF THE AO AND ACCORDINGLY WE SET ASIDE THE ORDER PASSED BY THE REVENUE AUTHORITIES ON THIS ACCOUNT AND SEND BACK TH E MATTER TO THE FILE OF THE AO WHO SHALL DECIDE THE SAME AFRESH AN D ACCORDING TO LAW AFTER PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE GROUNDS TAKEN BY THE ASSESSEE ARE THEREFORE P ARTLY ALLOWED FOR STATISTICAL PURPOSES. 4. IN THE RESULT, THE ASSESSEES APPEAL IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 01.02.2010. SD/- SD/- (RAJENDRA SINGH) ( D.K. AGARWAL ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED:01.02.2010. JV. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR E BENCH TRUE COPY BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI. ITA NO.2389/M/08 A.Y: 02-03 5 DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 11.1.10 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 11.1.10 SR.PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6. KEPT FOR PRONOUNCEMENT ON 01.02.10 SR.PS/PS 7. FILE SENT TO THE BENCH CLERK 03.02.10 SR.PS/PS 8 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER