Shri Shailesh B.Bhandari, Ahmedabad V. The Income tax Officer, Ward-4(1), Ahmedabad

ITA 31/AHD/2007

• Counselvise Citation: 3120514 RSA 2007
• Duration Of Justice: 6 year(s) 9 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-10-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 10-09-2013
• Assessment Year: 1997-1998
• Appeal Filed On: 02-01-2007
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P L KUREEL SRDR

Judgement Text

, , , , B, IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, B BENCH . .. . . .. . , !' !' !' !', , , , #$ #$ #$ #$ %& %& %& %& , , , , &' &' &' &' ( & ' ( & ' ( & ' ( & ' BEFORE S/SHRI G.C. GUPTA, VICE-PRESIDENT AND TEJ RAM MEENA, ACCOUNTANT MEMBER) ITA NO. & ASSTT.YEAR APPELLANT RESPONDENT 1. 62/AHD/2005 A.Y.1997-98 SMT. INDUBALA B. BHANDARI A-1, SKYLARK APARTMENTS SATELLITE ROAD, AHMEDABAD. ACIT, CIR.7 AHMEDABAD. 2. 63/AHD/2005 A.Y.1997-98 LATE SHRI B.C. BHANDARI L/H SHAILESH BHADARI A-1, SKYLARK APARTMENTS SATELLITE ROAD, AHMEDABAD. ACIT, CIR.7 AHMEDABAD. 3. 64/AHD/2005 A.Y.1997-98 SHRI MUKESH B. BHANDARI A-1, SKYLARK APARTMENTS SATELLITE ROAD, AHMEDABAD. ACIT, CIR.7 AHMEDABAD. 4. 65/AHD/2005 A.Y.1997-98 SMT. RITU BHANDARI A-1, SKYLARK APARTMENTS SATELLITE ROAD, AHMEDABAD. ACIT, CIR.7 AHMEDABAD. 5. 66/AHD/2005 A.Y.1997-98 SHRI SHAILESH B. BHANDARI A-1, SKYLARK APARTMENTS SATELLITE ROAD, AHMEDABAD. ACIT, CIR.7 AHMEDABAD. 6. 31/AHD/2007 A.Y.1997-98 SHRI SHAILESH B. BHANDARI A-1, SKYLARK APARTMENTS SATELLITE ROAD, AHMEDABAD. ITO, WARD-4(1) AHMEDABAD. 7. 32/AHD/2007 A.Y.1997-98 SHRI MUKESH B. BHANDARI A-1, SKYLARK APARTMENTS SATELLITE ROAD, AHMEDABAD. ITO, WARD-4(1) AHMEDABAD. 8. 2419/AHD/2006 A.Y.1997-98 SMT. RITU BHANDARI A-1, SKYLARK APARTMENTS SATELLITE ROAD, AHMEDABAD. ACIT, CIR.7 AHMEDABAD. ITA NOS.62 TO 66/AHD/2005 AND 5 OTHERS -2 9. 2420/AHD/2006 A.Y.1997-98 SMT. INDUBALA B. BHANDARI A-1, SKYLARK APARTMENTS SATELLITE ROAD, AHMEDABAD. ACIT, CIR.7 AHMEDABAD. 10. 2421/AHD/2006 A.Y.1997-98 LATE SHRI B.C. BHANDARI L/H SHAILESH BHADARI A-1, SKYLARK APARTMENTS SATELLITE ROAD, AHMEDABAD. ACIT, CIR.7 AHMEDABAD. ( (( (*+ *+ *+ *+ / APPELLANT) ( (( (,-*+ ,-*+ ,-*+ ,-*+ / RESPONDENT) .% / 0 &/ ASSESSEES BY : SHRI S.N. SOPARKAR WITH SHRI M.G. PATEL ( / 0 &/ REVENUE BY : SHRI P.L. KUREEL, SR-DR 2 / %3'/ DATE OF HEARING : 10 TH SEPTEMBER, 2013. 456 / %3'/ DATE OF PRONOUNCEMENT : 04/10/2013 &7 / O R D E R PER BENCH: THIS GROUP OF TEN APPEALS PREFERRED BY DIFFERENT ASSESSEES RELATES TO THE ASSESSMENT YEAR 1997-1998. THESE ARE BEING DISPOSED OF WITH THIS CONSOLIDATED ORDER. ITA NOS.62 TO 66/AHD/2005 (QUANTUM APPEALS): 2. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED I N ALL THESE QUANTUM APPEALS, THE ONLY/MAIN ISSUE IS REGARDING T HE ACTION OF THE CIT(A) IN CONFIRMING THE ORDER OF THE AO THAT CAPIT AL LOSS SUFFERED BY THE ASSESSEES ON SALE OF SHARES WAS NOT GENUINE, AND THEREFORE, THE AO HAD RIGHTLY DISALLOWED THE SAME. HE SUBMITTED T HAT THE TRIBUNAL IN THE ASSESSEES APPEALS, HAS RESTORED THE MATTER TO THE FILE OF THE AO ITA NOS.62 TO 66/AHD/2005 AND 5 OTHERS -3 WITH CERTAIN DIRECTIONS INCLUDING THAT THE ASSESSEE BE PERMITTED TO CROSS-EXAMINE SHRI ASHOK GUPTA, BROKER IN THE DEAL OF PURCHASE AND SALE OF SHARES, AND ALSO PUT THE ONUS ON THE ASSESS EE TO PRODUCE THE SAID WITNESS, SHRI ASHOK GUPTA FOR EXAMINATION. TH E MATTER WENT UPTO THE HONBLE JURISDICTIONAL HIGH COURT, WHEREIN THE ASSESSEE CONTENDED THAT THE ASSESSEE COULD NOT BE ASKED TO P RODUCE SHRI ASHOK GUPTA, AS HE WAS NOT A WITNESS OF THE ASSESSEE, AND IF THE EVIDENCE OF SHRI ASHOK GUPTA IS TO BE DISCARDED, THE TRIBUNAL M AY BE CALLED UPON TO DECIDE THE EFFECT OF THE REMAINING EVIDENCE ON R ECORD. THE CASE OF THE REVENUE BEFORE THE HONBLE GUJARAT HIGH COURT W AS THAT APART FROM THE EVIDENCE OF SHRI ASHOK GUPTA, THERE WAS VO LUMINOUS EVIDENCE ON RECORD AND ONLY GROUND THAT ONE OF THE WITNESSES COULD NOT BE OFFERED FOR CROSS-EXAMINATION, SHOULD NOT HA VE WEIGHED WITH THE TRIBUNAL, AND THAT THERE WAS SUFFICIENT EVIDENC E ON RECORD TO HOLD THAT THE TRANSACTION WAS NOT GENUINE. THE LEARNED COUNSEL FOR THE ASSESSEE FURTHER SUBMITTED THAT THE HONBLE HIGH CO URT SET ASIDE THE ORDER OF THE TRIBUNAL AND REMANDED THE PROCEEDING B EFORE THE TRIBUNAL TO RE-HEAR THE APPEALS WITH DIRECTION THAT EVIDENCE OF SHRI ASHOK GUPTA BE DISCARDED WHILE CONSIDERING AND DECI DING THE ASSESSEES APPEALS. THE LEARNED COUNSEL FOR THE AS SESSEE SUBMITTED THAT A BARE READING OF THE ASSESSMENT ORDER WILL SH OW THAT ENTIRE ASSESSMENT ORDER HOLDING THE CAPITAL LOSS FROM SALE OF SHARES AS NOT GENUINE, IS BASED ON THE STATEMENT OF SHRI ASHOK GU PTA, RECORDED BY THE DEPARTMENT. IN THESE FACTS, HE SUBMITTED THAT THE ONLY COURSE LEFT FOR THE TRIBUNAL IS TO RESTORE THE ISSUE TO THE FIL E OF THE AO WITH DIRECTION TO DISCARD THE EVIDENCE OF SHRI ASHOK GUP TA, AS PER THE DIRECTIONS OF THE HONBLE HIGH COURT, AND FRAME THE ASSESSMENT AFRESH ON THE BASIS OF ANY OTHER EVIDENCE, WHICH MAY BE AV AILABLE ON RECORD AFTER ALLOWING OPPORTUNITY OF HEARING TO THE ASSESS EE. ITA NOS.62 TO 66/AHD/2005 AND 5 OTHERS -4 3. THE LEARNED SR.DR SUBMITTED THAT IT HAS NO OBJEC TION IF THE MATTER IS RESTORED TO THE FILE OF THE AO FOR DE NOVO ASSESSMENT ORDER, AS THE REVENUE HAS OTHER EVIDENCE ON RECORD TO HOLD THAT TRANSACTION WAS NOT GENUINE. 4. WE HAVE CONSIDERED RIVAL SUBMISSIONS CAREFULLY, AND ALSO PERUSED THE ORDERS OF THE REVENUE AUTHORITIES AS WE LL THAT OF THE TRIBUNAL AND THE ORDER OF THE HONBLE JURISDICTIONA L HIGH COURT. WE FIND THAT HAVING CONSIDERED THE RIVAL PLEAS OF THE PARTIES, THE HONBLE HIGH COURT HAS REMANDED THE ISSUE TO THE FILE OF TH E TRIBUNAL WITH DIRECTION TO DISCARD THE EVIDENCE OF SHRI ASHOK GUP TA, WHILE DECIDING AND CONSIDERING THE ASSESSEES APPEALS. THE OPERAT IVE PART OF THE ORDER OF THE HONBLE GUJARAT HIGH COURT IS REPRODUC ED HEREINBELOW: HAVING THUS HEARD THE LEARNED COUNSEL FOR THE PART IES AND HAVING PERUSED THE RECORD, WE FIND THAT PREVIOUSLY EVEN AFTER BEST EFFORTS, WITNESS ASHOK GUPTA COULD NOT BE PROD UCED FOR CROSS-EXAMINATION AT THE HANDS OF THE ASSESSEE. SIM ULTANEOUSLY, REVENUE IS ALSO OF THE OPINION THAT THERE IS SUFFIC IENT INDEPENDENT EVIDENCE ON RECORD TO HOLD THAT THE TRA NSACTION WAS BOGUS EVEN AFTER DISCARDING THE EVIDENCE OF SHR I ASHOK GUPTA. IN THAT VIEW OF THE MATTER, WE FIND THAT THE TRIBUN AL'S DESIRE TO REMAND THE PROCEEDINGS FOR FRESH ATTEMPT TO OFFER S HRI ASHOK GUPTA FOR CROSS-EXAMINATION WAS NOT JUSTIFIED. FURT HER, WE FIND THAT THE ONUS TO PRODUCE SHRI ASHOK GUPTA, WHOSE ST ATEMENTS WERE RELIED UPON BY THE DEPARTMENT AND WHOSE CROSS- EXAMINATION WAS DESIRED BY THE ASSESSEE IS CAST ON THE ASSESSEE. IT WOULD BE A PIQUANT SITUATION IF THE ASSESSEE FAI LED TO PRODUCE THE SAID WITNESS BEFORE THE ASSESSING OFFICER. THE QUESTION MAY THEN ARISE WHETHER ON ACCOUNT OF THE ASSESSEE'S FAI LURE TO PRODUCE SHRI ASHOK GUPTA FOR CROSS-EXAMINATION AND THAT THEREFORE, NO CROSS-EXAMINATION COULD BE CARRIED OU T, WHAT WOULD BE THE EFFECT OF THE TRIBUNAL'S ORDER. TO AVO ID ALL THESE ITA NOS.62 TO 66/AHD/2005 AND 5 OTHERS -5 COMPLICATIONS, PARTICULARLY IN VIEW OF THE REVENUE' S FIRM STAND THAT QUITE INDEPENDENTLY OF THE EVIDENCE OF MR.ASHO K GUPTA, THERE WAS SUFFICIENT INDEPENDENT EVIDENCE TO SUSTAI N THE FINDINGS, WE ARE INCLINED TO SET ASIDE THE ORDER OF THE TRIBUNAL AND WE ACCORDINGLY SET ASIDE THE SAME. PROCEEDINGS ARE REMANDED BEFORE THE TRIBUNAL. THE TRIBUNAL IS REQUE STED TO REHEAR THE APPEALS. IT IS CLARIFIED THAT EVIDENCE O F SHRI ASHOK GUPTA SHALL, HOWEVER, BE DISCARDED WHILE CONSIDERIN G AND DECIDING THE ASSESSEE'S APPEAL. WE HAVE NOT EXPRESS ED ANY OPINION ON THE REMAINING CONTENTIONS OF THE RIVAL P ARTIES. APPEAL STANDS DISPOSED OF ACCORDINGLY. BOTH THE PARTIES BEFORE US SUBMITTED THAT THE MATTE R MAY BE RESTORED TO THE FILE OF THE AO WITH DIRECTION TO FRAME THE ASSE SSMENTS DE NOVO , AFTER DISCARDING THE EVIDENCE OF SHRI ASHOK GUPTA, ON THE BASIS OF OTHER EVIDENCE ON RECORD, AND AFTER GIVING OPPORTUN ITY OF HEARING TO THE ASSESSEE. IN THESE FACTS OF THE CASE, WE ARE O F THE VIEW THAT IT SHALL BE IN THE INTEREST OF JUSTICE TO RESTORE THESE ISSU ES BEFORE US TO THE FILE OF THE AO WITH DIRECTION TO FRAME DE NOVO ASSESSMENTS IN THESE CASES, AFTER DISCARDING THE EVIDENCE OF SHRI ASHOK GUPTA, ON THE BASIS OF OTHER MATERIAL/EVIDENCE AND AFTER ALLOWING SUFFICIE NT OPPORTUNITY OF HEARING TO THE ASSESSEES. WE DIRECT THE AO TO FRA ME THE ASSESSMENTS EXPEDITIOUSLY AND THE ASSESSEES ARE DIRECTED TO CO- OPERATE WITH THE REVENUE OFFICERS IN THE MATTER OF COMPLETION OF THE IR ASSESSMENTS. WE DIRECT ACCORDINGLY. ITA NOS.31 & 32/AHD/2007 AND 2419 TO 2421/AHD/2006 (PENALTY UNDER SECTION 271(1)(C) OF THE ACT.) 5. BOTH THE PARTIES BEFORE US SUBMITTED THAT IN CAS E THE QUANTUM APPEALS ARE RESTORED TO THE FILE OF THE AO, ALL THE SE PENALTIES HAVE TO BE CANCELLED SUBJECT TO THE FRESH INITIATION BY THE AO , IF SO REQUIRED. ITA NOS.62 TO 66/AHD/2005 AND 5 OTHERS -6 6. WE HAVE CONSIDERED SUBMISSIONS OF BOTH THE PARTI ES. IN VIEW OF OUR ORDER SETTING ASIDE THE ASSESSMENTS TO THE FILE OF THE AO IN ALL THE QUANTUM APPEALS OF THE ASSESSEES, IN THE FOREGOING PARAS OF THIS ORDER, ALL THE PENALTIES IN THESE APPEALS ARE CANCELLED. HOWEVER, THE AO SHALL BE AT LIBERTY TO RE-INITIATE PENALTY PROCEEDI NGS AS CONSEQUENCE OF THE ASSESSMENTS TO BE FRAMED IN THESE CASES IN QUAN TUM PROCEEDINGS, IF SO WARRANTED AS PER THE LAW. 7. IN THE RESULT, ITA NOS.62 TO 66/AHD/2005 ARE ALL OWED FOR STATISTICAL PURPOSE AND ITA NOS.31 & 32/AHD/2007 AN D 2419 TO 2421/AHD/2006 ARE ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE. SD/- SD/- ( %& %& %& %& / TEJ RAM MEENA) &' ( &' ( &' ( &' ( /ACCOUNTANT MEMBER ( . .. . . .. . /G.C. GUPTA) !' !' !' !' /VICE-PRESIDENT C OPY OF THE ORDER FORWARDED TO: 1) : APPELLANT 2) : RESPONDENT 3) : CIT(A) 4) : CIT CONCERNED 5) : DR, ITAT. BY ORDER DR/AR, ITAT, AHMEDABAD