SAJJAN KEDIA, MUMBAI V. ITO WARD 30(3)(2), MUMBAI, MUMBAI

ITA 2557/MUM/2023

• Counselvise Citation: [2023] 101 COUNSELVISE.COM (IT) 9949 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-11-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 14-11-2023
• Assessment Year: 2014-2015
• Appeal Filed On: 26-07-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Principle of natural justice
• Section: 131; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, MUMBAI BEFORE SHRI PAVAN KUMAR GADALE, JM & MS PADMAVATHY S, AM I.T.A. No. 2557/Mum/2023 (Assessment Year: 2014-15) Sajjan Kedia HUF 1004, K Palam Court, Malad Link Road, Malad West, Mumbai-400064. PAN :AAMHS9553G. Vs. ITO Ward-30(3)(2) Pratyakshkar Bhavan, Bandra Kurla Complex, Mumbai-400051. Appellant) : Respondent) Appellant/Assessee by : None Revenue/Respondent by : Shri Joginder Singh, Sr. DR Date of Hearing : 15.11.2023 Date of Pronouncement : 20.11.2023 O R D E R Per Padmavathy S, AM: This appeal is against the order of Ld. Commissioner of Income Tax (Appeals)-30, Mumbai / National Faceless Appeal Centre (for short 'CIT(A)' dated 22.05.2023 for Assessment Year (AY) 2014-15. 2. The assessee in this appeal raised various grounds with regard to the addition in respect of the Long Term Capital Gain claimed as exempt by the 2 ITA No. 2557/Mum/2023 Sajjan Kedia HUF assessee and also with regard to the loan transactions of the assessee. The assessee is a HUF filed the return of income for AY 2014-15 on 26.07.2014 declaring total income of Rs. Nil. The case was selected for scrutiny and the statutory notices were duly served on the assessee. During the year under consideration, the assessee has claimed exemption on the Long Term Capital Gain (LTCG) arising from sale of the scrip M/s. Matra Kaushal Enterprises Ltd (MKEL). The Assessing Officer (AO) called on the assessee to furnish details with regard to the said transaction and the assessee furnish*ed copies of Bank statement, Demat A/c statement and other details as called for by the AO. 3. The AO issued summons under section 131 of the Income Tax Act, 1961 (the Act) and recorded the statement of Mr. Sajjan Kedia in the capacity as Karta of assessee HUF. After perusing the details furnished by the assessee the AO held that the transaction is not genuine and accordingly made an addition of the entire sale consideration under section 68 of the Act. The AO also added commission paid @ 5% on the impugned transaction amounting to Rs. 82,486/- under section 69C of the Act. The AO further added a um of Rs. 2,60,000/- under section 68 of the Act towards loan transactions of the assessee. 4. Aggrieved, the assessee filed appeal before the Ld. CIT(A). Before the Ld. CIT(A) the assessee did not appear in response to various notices issued by the Ld. CIT(A). Accordingly, the CIT(A) dismissed the appeal of the assessee ex-parte and confirmed the additions made by the AO. 5. Before us none appeared on behalf of the assessee. The ld. DR submitted that the assessee has not appeared before the ld. CIT(A) and has not co-operated with the appellate proceedings and therefore, prayed that the order of the CIT(A) be upheld. 3 ITA No. 2557/Mum/2023 Sajjan Kedia HUF 6. We have heard the ld. DR. The AO during the course of assessment made addition towards sale of shares under section 68 for the reason that the scrip has been identified by Investigation Wing of the Department to be one of the scrip used for obtaining bogus LTCG. The ld. CIT(A) had issued notices on 8 occasions from January 2018 to December 2021 calling on the assessee to file details and represent the case. We noticed that the assessee has been filing only adjournment letters and the ld. CIT(A) had issued final notice on 25.04.2023 requiring the assessee to file response by 02.05.2020. Since the assessee has not responded even to the last of the notices, the CIT(A) dismissed the appeal in limine. 7. From the perusal of the records, we noticed that the assessee has submitted various details pertaining to the impugned transaction before the AO and in the grounds of appeal raised before the CIT(A), the assessee has contended that the initial onus has been discharged by the assessee in terms of filing the relevant details which has not been properly appreciated by the AO. It was also contended in the grounds before the CIT(A) that the AO has made the addition merely based on the findings of the Investigation Wing and that the report did not impute the assessee and that the AO failed to make further enquires. 8. In our considered view the contentions of the assessee before the CIT(A) needs factual verification and since the assessee did not represent the case before the CIT(A),the CIT(A) could not verify the contentions of the assessee on merits. Therefore, in the interest of natural justice and fair play we remit the issue back to the CIT(A) for denovo verification of the impugned transactions. The assessee is directed to furnish the relevant details in support of the claim before the CIT(A) as and when called for without seeking any adjournments and co-operate with the appellate proceedings. It is ordered accordingly. 4 ITA No. 2557/Mum/2023 Sajjan Kedia HUF 9. In the result, the appeal of assessee is allowed for statistical purposes. Order pronounced in the open court on 20-11-2023. Sd/- Sd/- (PAVAN KUMAR GADALE) (MS. PADMAVATHY S) Judicial Member Accountant Member *SK, Sr. PS Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. DR, ITAT, Mumbai 4. 5. Guard File CIT BY ORDER, (Dy./Asstt. Registrar) ITAT, Mumbai