VIGHNAHAR DEVELOPERS, NAVI MUMBAI V. ITO WD 2, PANVEL

ITA 2815/MUM/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 4119 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-07-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2005-2006
• Appeal Filed On: 26-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R R PRASAD

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH F, MUMBAI BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND DR. S.T.M. PAVALAN, JUDICIAL MEMBER ITA NO. 2815/MUM/2012 ASSESSMENT YEAR: 2005-06 M/S. VIGHNAHAR DEVELOPERS PLOT NO. 5 & 6, SECTOR 14, PALM BEACH ROAD, NERUL, NAVI MUMBAI-400706 PAN: AAEFV 7696 R VS. ITO WD 2 PANVEL (APPELLANT) (RESPONDENT) APPELLANT BY : MS. RITIKA AGARWAL RESPONDENT BY : SHRI R. R. PRASAD DATE OF HEARING : 18.07.2013 DATE OF PRONOUNCEMENT : 31.07.2013 O R D E R PER DR. S.T.M. PAVALAN, JM: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF THE LD.CIT (A)-1, MUMBAI DATED 27.02.2012 REFUSING TO CONDONE THE DELAY IN FILING THE BELATED APPEAL BY 1 YEAR 4 MONTHS AND 11 DAYS AND THEREBY C ONFIRMING THE ADDITIONS MADE BY THE AO FOR THE ASSESSMENT YEAR 2005-06. 2. BRIEFLY STATED, THE ASSESSEE, A PARTNERSHIP FIRM ENGAGED IN THE BUSINESS OF BUILDER AND DEVELOPER WHILE DECLARING A TOTAL INCOM E OF RS.2,05,500/- HAS SHOWN UNSECURED LOANS OF RS.9,35,42,402/-. IN THE ASSESSM ENT FRAMED U/S 143(3), THE AO AFTER NOTING THAT THERE WERE 69 ACCOUNTS WHEREIN TH E LOAN CREDITORS HAD PREPARED DDS/PAY ORDERS IN CASH TOTALLY AMOUNTING TO RS.2,07 ,40,395/-, MADE ADDITION OF THE SAME U/S 69 OF THE ACT AS THE ASSESSEE COULD NOT FU RNISH SUFFICIENT EVIDENCE TO PROVE THE GENUINENESS OF THE TRANSACTION AND CREDIT WORTH INESS OF THE CREDITOR. 3. ON APPEAL, THE LD.CIT (A) DISMISSED THE APPEAL O F THE ASSESSEE AS THE APPEAL WAS FILED BELATEDLY BY 1 YEAR 4 MONTHS AND 11 DAYS. THE LD.CIT (A) HAD NOT CONDONED THE SAID DELAY ON THE REASON THAT ASSESSEE HAD BEEN CHANGING ITS STAND FROM TIME AND AGAIN IN RESPECT OF ITS CLAIM AND FAI LED TO SUBSTANTIATE THE CAUSE OF ITA NO. 2815/MUM/2012 M/S. VIGHNAHAR DEVELOPERS ASSESSMENT YEAR: 2005-06 2 DELAY IN THE FILING OF THE APPEAL WHICH IS CLEAR CU T PAINTER TOWARDS THE FACT THAT THE ASSESSEE HAD BEEN CREATING EVIDENCES TO GIVE LOAN C REDITORS A COLOUR OF GENUINENESS. AGGRIEVED BY THE IMPUGNED ORDER THE ASSESSEE IS IN APPEAL BEFORE US. 4. HAVING HEARD BOTH THE SIDES AND PERUSED THE MATE RIAL ON RECORD, IT IS PERTINENT TO MENTION THAT IN THE ASSESSMENT PROCEED INGS, IN RESPONSE TO THE NOTICE ISSUED BY THE AO THE ASSESSEE VIDE LETTER DATED 20. 12.2007 VOLUNTARILY ACCEPTED THE ADDITION MADE BY THE AO IN ORDER TO BUY PEACE, AND TO AVOID FURTHER LITIGATION WITH A CONDITION THAT NO PENALTY WOULD BE LEVIED OVER THE SAID ADDITION U/S 271(1)(C) OF THE INCOME TAX ACT. IT IS THE CASE OF THE REVENUE THAT CONSEQUENT UPON THE LEVY OF PENALTY ON 30.06.2008, THE APPEAL HAS BEEN FILED BE FORE THE LD.CIT (A) BELATEDLY ON 11.06.2009 WHICH HAS BEEN RIGHTLY DISMISSED BY THE LD.CIT(A). THE ASSESSEE IN THE AFFIDAVIT DATED 10.06.2009 FILED EARLIER BEFORE THE LD.CIT(A), THE ASSESSEE HAS MENTIONED THAT THE DECISION OF SURRENDER AMOUNTING TO RS.207,40,395/- IS A SOLE DECISION OF 3 PARTNERS AND THIS FACT HAS BEEN INTEN TIONALLY CONCEALED FROM OTHER 4 PARTNERS. BECAUSE OF WHICH THE FIRM HAS FAILED TO F ILE APPEAL AGAINST THE SAID ASSESSMENT ORDER ON TIME. HOWEVER, AFTER OBTAINING LEGAL ADVICE, IT HAS BEEN UNDERSTOOD THAT THE APPEAL COULD STILL BE FILED AS THE SURRENDER MADE HAS NOT ACCEPTED BY AO. MOREOVER WITH THE PASSAGE OF TIME A ND MENDING OF TERMS WITH THE BROKER SH. ASHOK BHANUSHALI, COOPERATION FROM HIM H AS ALSO BEEN SECURED. THUS, WITH THE CONSENT OF ALL PARTNERS THE APPEAL HAS BEE N FILED ON 11.06.2009 ACCORDING TO THE ASSESSEE. THE APPRAISAL OF THE CONTENTIONS O F BOTH THE SIDES STRONGLY SUGGESTS THAT THE ASSESSEE HAD FILED THE APPEAL BELATEDLY DU E TO THE REASON OF LEVY OF PENALTY AND REASONS GIVEN BY THE ASSESSEE IS NOT COMPLETELY CONVINCING IN NATURE. THOUGH THERE IS A MERIT IN THE CONTENTION OF THE LD.DR THA T THE ASSESSEE HAS NOT BEEN PREVENTED FROM SUFFICIENT CAUSE FOR FILING THE BELA TED APPEAL, WE ARE OF THE OPINION THAT IN MATTERS OF CONDONING THE DELAY, A JUSTIFIAB LY LIBERAL APPROACH HAS TO BE ADOPTED BY THE AUTHORITIES EXERCISING JUDICIAL/QUAS I JUDICIAL FUNCTIONS. REFUSAL TO CONDONE THE DELAY CAN RESULT IN THE DISPOSAL OF A C LAIM AT THE VERY THRESHOLD AND ALSO BE A CAUSE OF JUSTICE BEING DEFEATED. WHEN THE DELA Y IS CONDONED, THE HIGHEST THAT CAN HAPPEN IS THAT A CAUSE WOULD BE DECIDED ON MERI TS AFTER HEARING THE PARTIES. IN VIEW OF THAT MATTER, WE ARE OF THE CONSIDERED OPINI ON THAT IT WOULD BE JUST AND ITA NO. 2815/MUM/2012 M/S. VIGHNAHAR DEVELOPERS ASSESSMENT YEAR: 2005-06 3 PROPER TO RESTORE THIS MATTER BACK TO THE FILE OF T HE LD.CIT (A) FOR DECIDING THE SAME AFRESH ON MERIT AFTER GIVING AN OPPORTUNITY OF BEIN G HEARD PRODUCING ALL THE MATERIALS TO SUBSTANTIATE THE CLAIM OF THE ASSESSEE. THUS, TH E DELAY IN FILING THE APPEAL BEFORE THE LD.CIT(A) IS CONDONED. SINCE THE REASONS PROVID ED BY THE ASSESSEE FOR CONDONING THE DELAY IN FILING THE BELATED APPEAL BE FORE THE LD.CIT (A) IS NOT COMPLETELY CONVINCING, WE IMPOSE A COST OF RS.10,00 0/- ON THE ASSESSEE TO BE PAID TO THE REVENUE. SUBJECT TO PRODUCING THE RECEIPT FO R THE SAID PAYMENT OF COST TO THE REVENUE, THE LD.CIT(A) WILL DECIDE THE MATTER ON ME RIT AFRESH IN THE AFORESAID MANNER. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 31S T DAY OF JULY 2013. SD/- SD/- (B. RAMAKOTAIAH) (DR. S.T.M. PAVALAN) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 31.07.2013. *SRIVASTAVA COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR F BENCH //TRUE COPY// BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMB AI.