Shri Jivanlal Jadavjibhai Jagani, RAJKOT-GUJARAT V. The Assistant Commr. Income Tax,Cen.Cir-1, RAJKOT-GUJARAT

ITA 291/RJT/2015

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 0442 (ITAT-RAJKOT)
• Duration Of Justice: 6 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-12-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2008-2009
• Appeal Filed On: 15-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: HARISH RANPURA
• Section: 143(3); 153A

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT [ CONDUCTED THROUGH E-COURT AT AHMEDABAD ] , , ! BEFORE SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER AND SHRI KUL BHARAT, JUDICIAL MEMBER 1. ./ I.T.A. NO.291/RJT/2015 2. ./ I.T.A. NO.292/RJT/2015 3. ./ I.T.A. NO.293/RJT/2015 ( / ASSESSMENT YEARS : 2008-09, 2009-10 AND 2011-12 - - RESPECTIVELY ) SHRI JIVANLAL JADAVJIBHAI JAGANI 61, AMI APARTMENT OPP.GIRNAR CINEMA RAJKOT / VS. THE ASSTT.CIT CENTRAL CIRCLE-1 RAJKOT & ./ ./ PAN/GIR NO. AAXPJ 8653 M ( &( / APPELLANT ) .. ( )&( / RESPONDENT ) &( * / APPELLANT BY : SHRI HARISH RANPURA, C.A. )&( + * / RESPONDENT BY : SHRI YOGESH PANDEY, D.R. ,-. + / DATE OF HEARING 10/12/2015 /0 + / DATE OF PRONOUNCEMENT 31/12/2015 / O R D E R PER BENCH : THIS BUNCH OF THREE APPEALS BY THE ASSESSEE IS DIRECTED AGAINST THE SEPARATE ORDERS OF THE LD.COMMISSIONER OF INCOM E TAX(APPEALS)-11, AHMEDABAD [CIT(A) IN SHORT] ALL IDENTICALLY DATED 12/03/20 15 PERTAINING TO ASSESSMENT YEARS (AYS) 2008-09, 2009- 10 & 2011-12. ITA NOS.291, 292 AND 293/RJT/2015 SHRI JIVANLAL JADAVJIBHAI JAGANI VS.ACIT ASST.YEARS 2008-09, 2009-10 AND 2011-12 RESPECTIVELY - 2 - SINCE THE COMMON GROUNDS HAVE BEEN RAISED IN ALL TH ESE APPEALS, THESE WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY TH IS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. THE ASSESSEE HAS RAISE D THE FOLLOWING COMMON GROUNDS, EXCEPT QUANTUM IN APPEALS (EXTRACTE D FROM ITA NO.291/RJT/2015 FOR AY 2008-09) :- 1.0 THE GROUNDS OF APPEAL MENTIONED HEREUNDER ARE WITHO UT PREJUDICE TO ONE ANOTHER. 2.0 THE LEARNED CIT(A) ERRED ON FACTS AS ALSO IN LAW IN RETAINING DISALLOWANCE OF PORTFOLIO MANAGEMENT FEES OF 3,20,595/- ON THE ALLEGED GROUND THAT THE FEES PAID HAS NO DIRECT REL ATION WITH ACQUISITION AND TRANSFER OF SECURITIES. THE DISALL OWANCE MAY KINDLY BE DELETED. 3.0 THE LEARNED CIT(A) ERRED ON FACTS AS ALSO IN LAW IN RETAINING DISALLOWANCE OF INTEREST EXPENSE TO THE EXTENT OF 4,94,447/- U/S.14A R.W.S. 8D OF THE ACT. THE DISALLOWANCE IS TOTALLY UNJUSTIFIED ON FACTS AS ALSO IN LAW AND MAY KINDLY BE DELETED. 4.0 YOUR HONORS APPELLANT CRAVES LEAVE TO ADD, AMEND, ALTER, OR WITHDRAW ANY OR MORE GROUNDS OF APPEAL ON OR BEFORE THE HEARING OF APPEAL. 2. FIRST, WE TAKE UP THE ASSESSEES APPEAL IN ITA NO.291/RJT/2015 FOR AY 2008-09 AS A LEAD CASE. DURING THE COURSE OF HEARING, THE ASSESSEE HAS TAKEN A GROUND BY WAY OF NOTE THAT REA DS AS UNDER:- GROUND NO.1 : THE LD.CIT(A) ERRED ON FACTS AS ALSO IN VALIDATING AOS ACTION OF FINALIZATION OF ASSESSMENT WITHOUT REFERENCE TO INC RIMINATING MATERIALS. 2.1. IN SUPPORT OF THE AFORESAID GROUND, THE ASSESS EE HAS SUBMITTED AS UNDER:- ITA NOS.291, 292 AND 293/RJT/2015 SHRI JIVANLAL JADAVJIBHAI JAGANI VS.ACIT ASST.YEARS 2008-09, 2009-10 AND 2011-12 RESPECTIVELY - 3 - A) SEARCH U/S.132 OF THE ACT WAS CARRIED OUT ON 08.09 .2011 AT THE APPELLANTS RESIDENCE. DURING THE COURSE OF SEARCH NOTHING INCRIMINATING WAS FOUND. B) SINCE NO MATERIAL WAS FOUND, INITIATION OF ACTION U /S.153A OF THE ACT IS BAD IN LAW. C) FURTHER, THE AO FINALIZED THE PROCEEDING U/S.153A O F THE ACT BY REVIEWING OR REVISITING THE COMPLETED ASSESSMENTS F INALIZED U/S.143(1)/143(3) OF THE ACT WHICH IS AGAINST THE P ROVISIONS OF SECTION 153A OF THE ACT. D) THE SECOND PROVISO TO SECTION 153A CONTEMPLATES THA T IF ANY OF THE SIX ASSESSMENTS IS PENDING ON THE DATE OF INITIATIO N OF THE SEARCH OR REQUISITION, THE SAME SHALL ABATE. THUS, ONLY PEND ING ASSESSMENTS AS ON THE DATE OF SEARCH SHALL ABATE. IT IMPLIES T HAT COMPLETED ASSESSMENTS EITHER U/S.143(3) OR 143(1) OF THE ACT DOES NOT ABATE AND BECOMES FINAL. E) THUS THE AO WAS NOT JUSTIFIED IN MAKING DISALLOWANC ES IN RESPECT OF COMPLETED ASSESSMENTS. F) IN THIS CONNECTION, RELIANCE IS PLACED ON THE FOLLO WING JUDICIAL PRONOUNCEMENTS: I) CIT VS. MGF AUTOMOBILES LTD. [2015] 63 TAXMANN.COM 137 (DELHI) II) CIT VS. KABUL CHAWLA IN [2015] 61 TAXMANN.COM 412 ( DELHI) III) CIT-II VS. CONTINENTAL WAREHOUSING CORP.LTD.[2015] 58 TAXMANN.COM 78 IV) CIT VS. JAYABEN RATILAL SORATHIA IN TAX APPEAL NO.9 14 OF 2012 (GUJ.). V) ALL CARGO GLOBAL LOGISTICS LTD. VS. DCIT [2012] 23 TAXMANN.COM 103(MUM). VI) SANJAY AGARWAL VS. DCIT [2014] 47 TAXMAN.COM 210; VII) HONBLE ITAT AHMEDABAD BENCH D IN THE CASE OF SAU MYA CONSTRUCTION PVT.LTD. VS. ACIT CENTRAL CIRCLE-1(3), AHMEDABAD IN ITA NO.3/AHD/2014. 2.2. THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSMENT DESERVES TO BE QUASHED ON THIS GROUND ALONE. HE S UBMITTED THAT THE AO ITA NOS.291, 292 AND 293/RJT/2015 SHRI JIVANLAL JADAVJIBHAI JAGANI VS.ACIT ASST.YEARS 2008-09, 2009-10 AND 2011-12 RESPECTIVELY - 4 - HAS NOT RECORDED THAT ANY NEW MATERIAL SEIZED DURIN G THE COURSE OF SEARCH USED FOR FRAMING THE ASSESSMENT. IN FACT, ALL THE DETAILS WERE AVAILABLE BEFORE HIM. THE LD.CIT-DR SUBMITTED THAT, ON THIS ISSUE, THERE ARE DIVERGENT VIEW OF THE HONBLE HIGH COURTS. HE PLAC ED RELIANCE ON THE ORDERS OF THE AUTHORITIES BELOW. 3. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AS WELL AS THE DECISIONS RELIED UPON BY THE PARTIES . THERE IS NO DISPUTE WITH REGARD TO THE FACT THAT THE ASSESSING OFFICER (AO) HAS NOT PLACED THE ASSESSMENT ON THE BASIS OF ANY MATERIAL FOUND DURIN G THE COURSE OF SEARCH. THE REVENUE HAS NOT POINTED OUT THAT WHAT MATERIAL WAS FOUND DURING THE COURSE OF SEARCH PROCEEDINGS. IN THE AB SENCE OF ANY INCRIMINATING MATERIAL THE ASSESSMENT FRAMED BY THE AO VIDE ORDER DATED 31/01/2014 U/S.153A R.W.S. 143(3) OF THE ACT CANNOT BE SUSTAINED. IN VIEW OF THE FOLLOWING JUDGEMENTS/DECISION OF VARIOU S HONBLE HIGH COURTS/TRIBUNAL: 1. DELHI IN THE CASE OF CIT VS. MGF AUTOMOBILES LT D. [2015] 63 TAXMANN.COM 137 (DELHI) 2. CIT VS. KABUL CHAWLA IN [2015] 61 TAXMANN.COM 4 14 (DELHI) 3. CIT-II VS. CONTINENTAL WAREHOUSING CORP.LTD. [2 015] 58 TAXMANN.COM 78 4. CIT VS. JAYABEN RATILAL SORATHIA IN TAX APPEAL NO.914 OF 2012(GUJ.) ITA NOS.291, 292 AND 293/RJT/2015 SHRI JIVANLAL JADAVJIBHAI JAGANI VS.ACIT ASST.YEARS 2008-09, 2009-10 AND 2011-12 RESPECTIVELY - 5 - 5. HONBLE ITAT AHMEDABAD BENCH D IN THE CASE OF SAUMYA CONSTRUCTION PVT.LTD. VS. ACIT CEN.CIRCLE-1( 3), AHMEDABAD IN ITA NO.3/AHD/2014. 3.1. RESPECTFULLY FOLLOWING THE AFORESAID JUDICIAL PRONOUNCEMENTS, WE HEREBY QUASH THE ASSESSMENT BEING BAD IN LAW. THER EFORE, THE GROUND NO.1 AS RAISED BY WAY OF NOTE IS ALLOWED AND THE OT HER GROUNDS HAVE BECOME ACADEMIC WHICH ARE NOT ADJUDICATED. RESULTA NTLY, ALL THE THREE APPEALS OF THE ASSESSEE ARE ALLOWED. 4. IN THE RESULT, ALL THE THREE APPEALS OF THE ASSE SSEE ARE ALLOWED. ORDER PRONOUNCED IN THE COURT ON THURSDAY, THE 31 ST DAY OF DECEMBER, 2015 AT AHMEDABAD. SD/- SD/- ( ) ( ) ( PRAMOD KUMAR ) ( KUL BHARAT ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 31/ 12 /2015 ..,, -. ,../ T.C. NAIR, SR. PS / COPY OF THE ORDER FORWARDED TO : 1. &( / THE APPELLANT 2. )&( / THE RESPONDENT. 3. 4 5 / CONCERNED CIT 4. 5 ( ) / THE CIT(A)-11, AHMEDABAD 5. 7-8 , , , /DR,ITAT, RAJKOT 6. 8CD E. / GUARD FILE. / BY ORDER, )7 //TRUE COPY// / ( DY./ASSTT.REGISTRAR) & ' , / ITAT, RAJKOT