ZAKIR HUSSAIN AKHTAR HUSSAIN, MUMBAI V. ITO 17(30(4), MUMBAI

ITA 3073/MUM/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 100587 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 3 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-08-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 04-06-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 04-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K KARDA M
• Keywords: Income from undisclosed sources; Principle of natural justice
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH G, MUMBAI BEFORE SHRI D.KARUNAKARA RAO, ACCOUNTANT MEMBER AND SHRI AMIT SHUKLA, JUDICIAL MEMBER ITA NO.3073/MUM/2012 ASSESSMENT YEAR: 2006-07 ZAKIR HUSSAIN AKHTAR HUSSAIN, ABBAS MANZIL, 190/192 MAULANA AZAD ROAD, NEXT TO MADANPURA POST OFFICE, MUMBAI-400 0008 PAN:ADLPA6858L VS. I.T.O- 17(3)(4) MUMBAI. (APPELLANT) (RESPONDENT) ASSESSEE BY : AASIFA KHAN REVENUE BY : SHRI A.K. KARDAM DATE OF HEARING : 30.07.2015 DATE OF PRONOUNCEMENT : 12.08.2015 O R D E R PER D. KARUNAKARA RAO, AM: THE PRESENT APPEAL PREFERRED BY THE ASSESSEE IS DIR ECTED AGAINST THE IMPUGNED ORDER DATED 17.02.2012 PASSED BY THE CIT(A )-19, MUMBAI THEREBY CONFIRMING THE ADDITIONS OF ` . 17,32,000/- TO THE INCOME OF THE ASSESSEE TREATING THE SAME AS UNDISCLOSED INCOME BY THE ASSESSING 2 ITA NO. 3073/MUM/2012 OFFICER (AO) VIDE ORDER DATED 22.12.2008 U/S. 143(3 ) OF THE INCOME-TAX ACT, 1961 FOR THE ASSESSMENT YEAR (AY) 2006-07. THE GROUNDS RAISED BY THE ASSESSEE READ AS FOLLOWS: 1. THE LEARNED COMMISSIONER OF INCOME TAX APPEAL 19 AND THE LD INCOME TAX OFFICER WARD NO. 17 (3)(4) ERRED IN CARR YING OUT THE ASSESSMENT UNDER SECTION 143(3) OF THE INCOME TAX A CT, 1961. 2. THE LEARNED COMMISSIONER OF INCOME TAX OFFICER A PPEAL 19 AND THE LD INCOME TAX OFFICER WARD NO. 17 (3)(4) HAS NOT GO NE THROUGH THE RECORDS AND CIRCUMSTANCES OF THE CASE. 3. THE LEARNED COMMISSIONER OF INCOME TAX OFFICER A PPEAL 19 STATES IN THE ORDER THAT MANY ADJOURNMENTS WERE SEEK BY THE A PPELLANT AND NOBODY ATTENDED THE SAID MATTER. THE NOTICE ISSUED BY THE LD. COMMISSIONER OF INCOME TAX OFFICER APPEAL 19 DID NO T STATE THAT ANY LAST OPPORTUNITY FOR HEARING IS GIVEN TO THE APPELL ANT AND THAT THE DATE GIVEN BY THE COMMISSIONER OF INCOME TAX APPEAL 19 F OR ATTENDANCE WAS 16/2/2012 WHICH WAS DECLARED THE DATE FOR ELECT IONS. CONSIDERING A STATE HOLIDAY, THE APPELLANT DID NOT APPEAR BEFORE THE COMMISSIONER AND THAT HE DID APPEAR BEFORE THE COMMISSIONER THE NEXT DATE, BUT HIS PLEA WAS REJECTED AND WITHOUT ANY FURTHER ENTERTAIN MENT, THE COMMISSIONER HAD ALREADY PASSED THE ORDER AGAINST T HE APPELLANT. 4. IN PARA NO (4) OF THE ORDER OF THE LD. COMMISSIO NER OF INCOME TAX APPEAL 19 IT IS STATED THAT NO WRITTEN SUBMISSIONS WERE SUBMITTED BY THE APPELLANT. THE LD. COMMISSIONER OF INCOME TAX APPEA L HAS NOT PROPERLY GONE THROUGH THE FILE OF THE APPELLANT AND HAS OVER LOOKED THE SUBMISSIONS THAT WERE MADE BY THE APPELLANT THROUGH IT'S AUTHORIZED REPRESENTATIVE ON DATED 25/10/2010. (COPY OF WHICH IS ENCLOSED HEREWITH AND MARKED AS EXHIBIT 'A'). 5. THE SAID MATTER AS SUPPOSEDLY CARRIED OUT IN APP EAL 29, WHERE THE APPELLANT'S AUTHORIZED REPRESENTATIVE HAD APPEARED AND ALSO FILED IT'S WRITTEN SUBMISSION. LATER, THE SAID MATTER WAS TRAN SFERRED TO APPEAL 19 IN THE YEAR 2011. 6. THE LD. COMMISSIONER OF INCOME TAX APPEAL 19 DID NOT REFER THE SUBMISSIONS THAT WERE SUBMITTED BEFORE -THE INCOME TAX OFFICER 17(3)(4) BY THE APPELLANT'S AUTHORIZED REPRESENTATI VE VIDE LETTER DATED 26/12/2008. 7. THE APPELLANT HAD APPEALED BEFORE THE COMMISSION ER OF INCOME TAX IN THE GROUNDS THAT THE SAID AMOUNT WAS DEPOSITED B Y THE APPELLANT'S FAMILY MEMBERS INTO HIS BANK ACCOUNT AS ALL THE HOU SEHOLD EXPENSES WERE MADE BY THE APPELLANT BEING THE ELDEST SON OF THE FAMILY. 3 ITA NO. 3073/MUM/2012 8. THE APPELLANT'S FAMILY MEMBERS ARE ALL ASSESSED TO TAX AND HAVE REGULARLY FILED THEIR TAX RETURNS. 9. IT WAS ALSO VERY WELL SUBMITTED IN THE GROUNDS T HAT THE SUBMISSIONS MADE TO THE LD. I.T.O. WARD 17(3)(4) WERE NEVER CON SIDERED BY HIM AND THEREFORE THE ASSESSMENT WAS MADE HASTILY AND C APRICIOUSLY. 10. THE APPELLANT HAD FURNISHED BEFORE THE LD CIT A PPEAL 19 ALONG WITH THE APPEAL AND GROUNDS OF APPEAL THE DETAILS OF CAS H DEPOSITS AND WITHDRAWN BY THE APPELLANT. THE APPELLANT STATES TH AT THE CASH CREDITED INTO HIS BANK ACCOUNT WERE NOT HIS OWN MONEY BUT TH E MONEY SOLELY BELONGS TO HIS FAMILY MEMBERS. 11. THAT THE FACT REMAINS THAT THE APPELLANT HAD DE POSITED THE CASH INTO HIS ACCOUNTS, BUT THE SAME WAS WITHDRAWN AND PAID A GAINST PAYMENT OF MONTHLY AND YEARLY LIC. 12. THAT LD CIT APPEAL 19 HAS NOT GONE THROUGH THE FACTS OF THE CASE PROPERLY. THE LEARNED CIT APPEAL HAS COMPUTED JUST ON THE BASIS OF THE ASSESSMENT ORDER OF THE LD INCOME TAX OFFICER WARD 17 (3) (4). IT IS UNDERSTOOD THAT THE LEARNED CIT APPEAL 19 HAS COME TO THE CONCLUSION CAPRICIOUSLY. 13. THAT THE APPELLANT IS AN ILLITERATE PERSON AND HAS NO KNOWLEDGE OF TAX LAWS AND HE IS HIGHLY DEPENDENT ON HIS TAX CONS ULTANTS FOR HIS TAX MATTERS. 14. THE LEARNED I.T.O. HAS NOT MADE AN HONEST AND F AIR ESTIMATION OF THE INCOME OF THE ASSESSEE. THE JUDGEMENT IS MADE A RBITRARILY. 15. THAT THE APPELLANT BEING AN AGGRIEVED AND AN IL LITERATE PERSON HAS ALWAYS RELIED UPON THE TAX CONSULTANT FOR HIS INCOM E TAX RETURN FILING AND THUS BEING A COMMON MAN WITHOUT HAVING ANY KNOW LEDGE ABOUT TAXATION HAS BLINDLY RELIED UPON HIS TAX CONSULTANT . 16. THUS, IT HAS BEEN PROVED THAT THE APPELLANT HAS NEITHER TRIED TO HIDE OR UNDISCLOSE HIS INCOME AND / OR CONCEALED HIS INC OME. 17. THUS, IT IS PRAYED THAT THE ORDER UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 TO BE DELETED, SET-ASIDE AND IN THE I NTEREST OF JUSTICE THE APPELLANT BE GIVEN AN OPPORTUNITY TO EXPLAIN. 18.LT IS ALSO FURTHER PRAYED THAT IN CASE THE CASE REQUIRES THE APPELLANT BE GIVEN AN OPPORTUNITY TO PROVIDE FURTHER ADDITION AL EVIDENCES IN THE INTEREST OF JUSTICE IN RESPECT OF THE SAID MATTER A ND THE ADDITIONS MADE BY THE LEARNED I.T.O AND CONFIRMED BY C.I.T (APPEAL IT MAY BE DELETED. 4 ITA NO. 3073/MUM/2012 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E HAD FILED HIS RETURN OF INCOME ON 02.03.2007 DECLARING TOTAL INCO ME OF ` . 1,29,280/-. THE RETURN WAS PROCESSED U/S. 143(1) OF THE ACT ACC EPTING THE RETURNED INCOME. THE CASE WAS SELECTED FOR SCRUTINY UNDER CA SS AND SUBSEQUENTLY NOTICE U/S 143(2) WAS ISSUED AND SERVE D ON THE ASSESEE. DURING THE YEAR, THE ASSESSEE DEPOSITED A CASH OF ` . 17,32,000/- IN HIS SB A/C WITH SARASWAT CO-OP. BANK, MUMBAI. AFTER OBT AINING THE COPY OF BANK ACCOUNT, A LETTER DATED 12.12.2008 WAS ISSUED BY THE AO AS TO WHY CASH DEPOSIT IN BANK SHOULD NOT BE TREATED AS INCO ME FROM OTHER SOURCES AND NOT BE ADDED TO HIS TOTAL INCOME. EVEN AFTER SEVERAL NOTICES, THE ASSESSEE DID NOT ATTEND OR SUBMITTED A NY EXPLANATION. AO MADE ASSESSMENT AND ADDED ` . 17,32,000/- TOWARDS INCOME FROM UNDISCLOSED SOURCES. 3. AGGRIEVED BY THE SAID ORDER DATED 22.12.2008, AS SESSEE FILED AN APPEAL BEFORE THE CIT(A). THE NOTICE OF THE APPEAL WAS ALSO SERVED UPON THE ASSESSEE FOR THE HEARING OF THE APPEAL ON VARIO US DATES. EVEN, THEREAFTER, THE ASSESSEE DID NOT APPEAR BEFORE THE CIT(A). ULTIMATELY IN THE ABSENCE OF ASSESSEE, AND CONSIDERING THE GROUND S OF APPEAL, THE APPEAL FILED BY THE ASSESSEE WAS DISMISSED BY CIT(A ) VIDE ORDER DATED 17.02.2012. AGGRIEVED BY THE ORDER DATED 17.02.2012 PASSED BY THE CIT(A), THE ASSESSEE FILED THE PRESENT APPEAL BEFOR E US. 5 ITA NO. 3073/MUM/2012 4. AT THE VERY OUTSET, BEFORE US, THE COUNSEL FOR T HE ASSESSEE SUBMITTED THAT THE CIT(A) ERRED IN NOT GRANTING PRO PER, SUFFICIENT AND ADEQUATE OPPORTUNITY OF HEARING TO THE ASSESSEE DUR ING THE APPELLATE PROCEEDING. THE COUNSEL FURTHER SUBMITTED THAT NON- ATTENDANCE OF HEARING BY THE ASSESSEE WAS BEYOND THE CONTROL OF T HE ASSESSEE AS THE CASE OF THE ASSESSEE WAS TRANSFERRED TO VARIOUS JURI SDICTIONS DUE TO ADMINISTRATIVE REASONS. MOREOVER, THE HEARING OF TH E APPEAL WAS FIXED ON 16.02.2012 WHICH HAPPENED TO BE A MUNICIPAL ELECTIO N DAY IN MUMBAI. IN ORDER TO SUPPORT HIS ARGUMENTS, THE COUNSEL FOR THE ASSESSEE HAS ALSO SUBMITTED PAPER BOOK AND DRAWN OUR ATTENTION TOWARD S THE INFORMATION PLACED ON RECORD REGARDING THE DATE FIXED FOR BMC E LECTION. 5. ON THE OTHER HAND, THE DR REPRESENTING THE REVEN UE SUBMITTED THAT ABSENCE OF THE ASSESSEE AS WELL AS AUTHORISED REPRESENTATIVE (AR) WAS INTENTIONAL AND THE CONDUCT OF THE ASSESSEE SHO WS THAT THE ASSESSEE AS WELL AS HIS REPRESENTATIVE DID NOT APPEAR BEFORE THE CIT(A) AS WELL AS THE AO EVEN AFTER REMINDERS ON VARIOUS DATES. THE C IT(A) HAD NO OPTION EXCEPT TO DECIDE THE APPEAL ON THE BASIS OF GROUND OF APPEAL AS WELL AS MATERIAL AVAILABLE ON RECORD. THEREFORE, AS PER THE LD. COUNSEL FOR REVENUE , THE ORDER PASSED BY THE CIT(A) DO NOT NEE D ANY INTERFERENCE. 6 ITA NO. 3073/MUM/2012 6. WE HAVE HEARD THE LEARNED COUNSEL FOR THE ASSESS EE AS WELL AS DR REPRESENTING THE REVENUE AND HAVE ALSO PERUSED THE RECORD AS WELL AS THE ORDERS OF REVENUE. IT IS UNDISPUTED FACT THAT T HE CIT(A) HAD SERVED NOTICE UPON THE ASSESSEE FOR HEARING ON 16.02.2012. SINCE 16.02.2012 HAPPENED TO BE A HOLIDAY ON ACCOUNT OF BMC ELECTION , ASSESSEE HAD SUFFICIENT CAUSE FOR NON APPEARANCE BEFORE THE CIT( A) ON THAT DAY. HENCE KEEPING IN VIEW THE AFOREMENTIONED FACTUAL PO SITIONS IN ABSENCE OF THE ASSESSEE BEFORE THE CIT(A) IS UNINTENTIONAL AND BONAFIDE AND THEREFORE THE ASSESSEE IS ENTITLED TO BE HEARD ON M ERITS. 7. WE ARE OF THE CONSIDERED OPINION THAT IT IS A SE TTLED LAW THAT LIS BETWEEN THE PARTIES SHOULD BE DECIDED ON MERITS AND NO ORDER PREJUDICIAL TO THE INTEREST OF THE ASSESSEE BE PASSED AT HIS BA CK. EVEN, OTHERWISE, THE PRINCIPLES OF NATURAL JUSTICE ALSO DEMAND THAT A FULL AND EFFECTIVE OPPORTUNITY OF HEARING SHOULD BE GRANTED TO THE PAR TIES BEFORE DECIDING THEIR CASE. 8. THEREFORE, KEEPING IN VIEW, THE AFOREMENTIONED F ACTS AND CIRCUMSTANCES AND THE LEGAL PROPOSITION DISCUSSED A BOVE. THE IMPUGNED ORDER DATED 22.12.2008 PASSED BY THE CIT(A) ARE SET -ASIDE AND THE MATTER IS REMANDED BACK TO THE FILE OF THE AO FOR P ASSING A FRESH ORDER 7 ITA NO. 3073/MUM/2012 AFTER PROVIDING EFFECTIVE OPPORTUNITY TO THE ASSESS EE. ACCORDINGLY, THE GROUNDS RAISED BY THE ASSESSEE ARE ALLOWED FOR STAT ISTICAL PURPOSES. 9. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS A LLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 12 TH DAY OF AUGUST, 2015. SD/- SD/- (AMIT SHUKLA) (D.KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 12.08.2015 SHARWAN P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR G BENCH //TRUE COPY// BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.