MR. JITENDRA RATILAL SALOT, MUMBAI V. ITO 11(3)(3), MUMBAI

ITA 2862/MUM/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 2014 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 1 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-06-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 06-05-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJAY J SETHI
• Assessee Lawyers: SANDEEP CHATURVEDI
• Keywords: Salary income
• Section: 69C

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC, MUMBAI , BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER . 2862 //2019 (. . 2013-14 ) ITA NO.2862/MUM/2019 (A.Y.2013-14) MR. JITENDRA RATILAL SALOT PLOT NO.18, NAVYUG CHS, N.S. ROAD, JVPD SCHEME, VILE PARLE, MUMBAI-400056. PAN: AAFPS1865C ...... ) / APPELLANT VS. ITO WARD-11(3)(3) ROOM NO. 429, 4 TH FLOOR, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI-400020 ..... *,/ RESPONDENT ) -/ APPELLANT BY : SH. SANDEEP CHATURVEDI *, -/ RESPONDENT BY : SH. SANJAY J. SETHI . / DATE OF HEARING : 31/05/2021 . / DATE OF PRONOUNCEMENT : 10/06/2021 / ORDER PER VIKAS AWASTHY, J.M: THIS APPEAL BY THE ASSESSEE IS AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-18, MUMBAI [HEREINAFTER REFERR ED TO AS THE CIT(A)] DATED 28.02.2019 FOR THE ASSESSMENT YEAR (AY) 2013- 14. 2. THE ASSESSEE HAS ASSAILED THE ORDER OF CIT(A) ON TWO COUNTS I.E. 2 . 2862 //2019 (. .2013-14 ) ITA NO.2862/MUM/2019 (A.Y.2013-14) (1) DISALLOWANCE OF EXPENDITURE UNDER SECTION 69C OF TH E INCOME TAX ACT, 1961 [HEREINAFTER REFERRED TO AS THE ACT] RS. 3,93,804/- (2) ADHOC DISALLOWANCE OF HOUSEHOLD EXPENDITURE UNDER S ECTION 69C OF THE ACT. RS. 4,80,000/- 3. SHRI SANDEEP CHATURVEDI APPEARING ON BEHALF OF T HE ASSESSEE SUBMITTED THAT THE ASSESSEE IS A SENIOR CITIZEN. THE ASSESSEE FILED HIS RETURN OF INCOME FOR AY 2013-14 ON 30.04.2014 DECLARING TOTAL INCOME OF RS. 31,60,240/-. THE ASSESSEE HAS INCOME FROM SALARY, HOUSE PROPERTY & I NCOME FROM OTHER SOURCES. DURING ASSESSMENT PROCEEDINGS, THE ASSESSE E INTERALIA MADE DISALLOWANCE OF EXPENDITURE RS. 3,93,804/-. THE SAI D EXPENDITURE WAS INCURRED BY THE ASSESSEE THROUGH CREDIT CARD OF HDFC BANK. T HE ASSESSEE IS A DIRECTOR OF M/S VIJAY LATEX PVT. LTD. & VIJAY SABRE SAFETY PVT. LTD. THE ASSESSEE HAS MADE PAYMENTS THROUGH CREDIT CARD IN RESPECT OF EXPENDIT URE INCURRED FOR THE AFORESAID COMPANY. THE ASSESSEE HAD FURNISHED THE D ETAILS BEFORE THE AO ON 16.03.2016 AND AGAIN ON 18.03.2016. ALONG WITH THE DETAILS, THE ASSESSEE FURNISHED STATEMENTS OF CREDIT CARD, HOWEVER, THE S AME WERE NOT CONSIDERED BY THE AO IN ASSESSMENT PROCEEDING. THE LD. AR POI NTED THAT THE ASSESSEE HAD FURNISHED THE STATEMENTS BEFORE THE AO, HOWEVER, TH E AO DECLINED TO ACCEPT THE SAME ON THE PREMISES THAT THE ASSESSMENT ORDER HAS BEEN FINALIZED, WHEREAS THE ASSESSMENT ORDER HAS PASSED ON 21.03.20 16. IN FIRST APPELLATE PROCEEDING, THE ASSESSEE BROUGHT THIS FACT TO THE N OTICE OF CIT(A). THE CIT(A) REFUSED TO ACCEPT THE STATEMENTS AND DISBELIEVED TH AT THE ASSESSEE FURNISHED THE DETAILS & STATEMENTS BEFORE THE ASSESSING OFFIC ER (AO). 3 . 2862 //2019 (. .2013-14 ) ITA NO.2862/MUM/2019 (A.Y.2013-14) 4. IN RESPECT OF GROUND NO.2, THE LD. AR SUBMITTED THAT THE AO HAS MADE ADHOC DISALLOWANCE OF RS. 4,80,000/- IN RESPECT OF HOUSEHOLD EXPENDITURE, THE ASSESSEE HAD FURNISHED THE DETAILS, THE AO REJECTED THE SAME AND PROCEEDED ON TO ESTIMATE DISALLOWANCE IN RESPECT OF HOUSEHOLD EXPENDITURE. THE LD. AR POINTED THAT THE ASSESSEE HAD FURNISHED THE DETAILS OF THE FAMILY TO THE AO, HOWEVER, WITHOUT APPRECIATING THE FACTS, THE AO MAD E ADDITION. IN FIRST APPELLATE PROCEEDINGS, THE CIT(A) CONFIRMED THE DIS ALLOWANCE WITHOUT PROPERLY APPRECIATING THE SUBMISSIONS OF THE ASSESSEE AND DO CUMENTS ON RECORD. THE ASSESSEE HAS A FAMILY OF SIX MEMBERS. THE ESTIMATIO N OF MONTHLY EXPENDITURE AT RS. 40,000/- PER MONTH BY NO STRETCH OF IMAGINAT ION IS REASONABLE. THE LD. AR PLACED RELIANCE ON THE DECISION OF TRIBUNAL IN T HE CASE OF ATUL D. PAWAR IN ITA NO. 1043/MUM/2012 DECIDED ON 13.02.2013 TO CONT END THAT NO DISALLOWANCE ON ESTIMATION SHOULD BE MADE IN RESPEC T OF HOUSEHOLD EXPENDITURE. 5. SHRI SANJAY SETHI REPRESENTING THE DEPARTMENT VE HEMENTLY DEFENDED THE IMPUGNED ORDER AND PRAYED FOR DISMISSING THE APPEAL OF ASSESSEE. THE LD. DR SUBMITTED THAT THE ASSESSEE HAD NOT BROUGHT ON RECO RD ANY DOCUMENTARY EVIDENCES BEFORE THE AO TO SUBSTANTIATE HIS CLAIM I N RESPECT OF EXPENDITURE MADE THROUGH CREDIT CARD. 6. SUBMISSIONS MADE BY BOTH SIDES HEARD, ORDERS OF AUTHORITIES BELOW EXAMINED. IN GROUND NO.1 OF APPEAL, THE ASSESSEE HA S ASSAILED DISALLOWANCE OF RS.3,93,804/- PAID THROUGH CREDIT CARD IN RESPECT OF M/S VIJAY SABRE SAFETY PVT. LTD. THE ASSESSEE PURPORTEDLY FURNISHED CREDIT CARD STATEMENTS BEFORE THE 4 . 2862 //2019 (. .2013-14 ) ITA NO.2862/MUM/2019 (A.Y.2013-14) AO ON 18.03.2016, THE FORWARDING LETTER AND THE CRE DIT CARD STATEMENTS ARE AT PAGE 38 TO 52 OF THE PAPER BOOK. THE CONTENTION OF THE ASSESSEE IS THAT THE AO REFUSED TO ACCEPT THE SAME ON THE PRETEXT THAT THE ASSESSMENT ORDER HAS BEEN FINALIZED, WHEREAS THE ASSESSMENT ORDER WAS PASSED ON 21.03.2016. A PERUSAL OF THE FORWARDING LETTER AT PAGE NO.25 REVEALS THAT IT DOES NOT BEAR THE ACKNOWLEDGEMENT STAMP OF THE OFFICE OF THE AO. WITH OUT DELIBERATING AND MAKING FURTHER OBSERVATION ON WHETHER DOCUMENTS WER E FURNISHED BY THE ASSESSEE DURING ASSESSMENT PROCEEDINGS OR NOT, I DE EM IT APPROPRIATE TO RESTORE THIS ISSUE TO THE FILE OF AO FOR CONSIDERIN G THE STATEMENTS FURNISHED BY THE ASSESSEE VIDE LETTER DATED 18.03.2016 AND DECID E THE ISSUE AFRESH, AFTER AFFORDING REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE, IN ACCORDANCE WITH LAW. THE GROUND NO.1 OF THE APPEAL IS THUS, AL LOWED FOR STATISTICAL PURPOSE. 7. IN GROUND NO.2 OF APPEAL, THE ASSESSEE HAS ASSAI LED ADDITION OF RS. 4,80,000/- MADE IN RESPECT OF HOUSEHOLD EXPENDITURE . THE SHORT CONTENTION OF THE ASSESSEE IS THAT THE ADDITION HAS BEEN MADE WIT HOUT APPRECIATING THE FACT AND WITHOUT AFFORDING PROPER OPPORTUNITY OF HEARING TO THE ASSESSEE. A PERUSAL OF THE IMPUGNED ORDER SHOWS THAT CIT(A) HAS CONFIRM ED THE ADDITION BY INVOKING THE PRINCIPLES OF PREPONDERANCE OF PROBAB ILITY IN THE ABSENCE OF ANY COGENT EVIDENCE. THE LD. AR OF THE ASSESSEE CONTEND ED THAT THE ASSESSEE HAS FURNISHED ALL THE NECESSARY EVIDENCES BEFORE THE AO IN SUPPORT OF HIS CONTENTION ON THIS ISSUE, HOWEVER, THE SAME HAS NOT BEEN EXAMINED AND ADHOC DISALLOWANCE HAS BEEN MADE. I DEEM IT APPROPRIATE T O RESTORE THIS ISSUE AS WELL TO THE FILE OF AO FOR EXAMINING THE DOCUMENTS FURNI SHED BY THE ASSESSEE IN 5 . 2862 //2019 (. .2013-14 ) ITA NO.2862/MUM/2019 (A.Y.2013-14) SUPPORT OF HIS CONTENTIONS. THE AO SHALL GRANT REAS ONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE BEFORE DECIDING THIS ISSUE, IN ACCORDANCE WITH LAW. 8. IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE, IN THE TERMS AFORESAID. ORDER PRONOUNCED IN THE OPEN COURT ON THURSDAY , THE 10 TH DAY OF JUNE, 2021. SD/- (VIKAS AWASTHY) / JUDICIAL MEMBER / MUMBAI, 3/ DATED: 10/06/2021 SK, PS * 4 * 4 * 4 * 4 COPY OF THE ORDER FORWARDED TO : 1. ) / THE APPELLANT , 2. *, / THE RESPONDENT. 3. 5 ( )/ THE CIT(A)- 4. 5 CIT 5. * , . . . , / DR, ITAT, MUMBAI 6. 9 / GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI