Suraj Jhunjhunwala, Kolkata V. ITO, Ward 41(3), Kolkata, Kolkata

ITA 317/KOL/2017

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 7312 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 8 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-10-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 19-09-2019
• Assessment Year: 2009-2010
• Appeal Filed On: 16-02-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RANU BISWAS
• Keywords: Additional evidence; Set aside
• Section: 133(6); 250

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA B BENCH, KOLKATA (BEFORE SRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER & SRI S.S. GODARA, JUDICIAL MEMBER) I.T.A. NO. 317/KOL/2017 ASSESSMENT YEAR: 2009-10 SURAJ JHUNJHUNWALA...........................................................................................................................APPELLANT [PAN : ACVPJ 0833 D] VS. ITO, WARD- 41 (3), KOLKATA...................................................................................RESPONDENT APPEARANCES BY: SH. SUBASH AGARWAL, ADV., APPEARED ON BEHALF OF THE ASSESSEE. SMT. RANU BISWAS, ADDL CIT, APPEARED ON BEHALF OF THE REVENUE. DATE OF CONCLUDING THE HEARING : SEPTEMBER 19 TH , 2019 DATE OF PRONOUNCING THE ORDER : OCTOBER 18 TH , 2019 ORDER PER J. SUDHAKAR REDDY, AM :- THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-13, KOLKATA [CIT(A) FOR SHORT] DATED 04.10.2016 PASSED U/S 250 OF THE INCOME TAX ACT, 1961 (THE ACT FOR SHORT) ON THE FOLLOWING REVISED GROUND OF APPEAL: 1. FOR THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE ADDITION OF RS.5,37,184/- MADE BY THE AO ON ACCOUNT OF UNDISCLOSED STOCK. 2. FOR THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE ADDITION OF RS.46,46,308/- MADE BY THE AO ON ACCOUNT OF INFLATED PURCHASES. 3. FOR THAT FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE ADDITION OF RS. 35,115/- MADE BY THE AO ON ACCOUNT OF SALES PROMOTION EXPENSES. 2. AFTER HEARING RIVAL SUBMISSIONS, CONSIDERING THE PAPERS ON RECORD AND ORDERS OF THE AUTHORITIES BELOW, WE HOLD AS FOLLOWS. 3. GROUND NO. 1 IS AGAINST THE ADDITION ON ACCOUNT OF UNDISCLOSED STOCK. THE ASSESSEE IS ENGAGED IN SHARE TRADING BUSINESS. THE ASSESSING OFFICER (AO FOR SHORT) ISSUED NOTICE U/S 133(6) OF THE ACT TO M/S. EAST INDIA SECURITIES LTD. D.P. (DEPOSITORY 2 I.T.A. NO. 317/KOL/2017 ASSESSMENT YEAR: 2009-10 SURAJ JHUNJHUNWALA PERSON) AND RECEIVED SOME INFORMATION AND COMPARED THE SAME WITH THE OPENING STOCK, PURCHASES AND SALE AND CLOSING STOCK OF SHARES DISCLOSED BY THE ASSESSEE AND NOTICED CERTAIN DISCREPANCIES. THE ASSESSEE WAS ASKED TO RECONCILE THE DIFFERENCES. THE ASSESSEE EXPLAINED THAT, WHEN THERE WAS PURCHASE AND SALE OF SHARES, WITHOUT HOLDING THE SAME BY THE ASSESSEE, THE DISCREPANCIES OCCURRED AND THAT SUCH SALES WERE LYING WITH THE DP OF THE BROKER. AS THE DIFFERENCE WAS NOT PROPERLY EXPLAINED, THE AO ADDED THIS AMOUNT AS INCOME. THE AMOUNT OF RS. 5,37,184/-, WAS THE DIFFERENCE BETWEEN THE AMOUNT, WHICH THE ASSESSEE HAD SHOWN AS CLOSING STOCK BY THE ASSESSEE AND THE CLOSING STOCK SHOWN AS AVAILABLE IN THE HANDS OF THE ASSESSEE BY M/S. EAST INDIA SECURITIES LTD. (DP). BEFORE THE LD. CIT(A) THE ASSESSEE REPEATED ITS CONTENTION AND ALSO FILED ADDITIONAL EVIDENCES. THE SUM AND SUBSTANCE OF THE CONTENTION IS THAT, THE ASSESSEE HAS STOCK IN HIS INDIVIDUAL CAPACITY AS WELL AS IN THE HANDS OF THE PROPRIETOR FIRM. THE LD. CIT(A) DID NOT ADMIT THE ADDITIONAL EVIDENCE AND CONFIRMED THE ORDER OF THE LD. AO. IN OUR VIEW, INTEREST OF JUSTICE WOULD BE MET AS WE SET ASIDE THIS ISSUE TO THE FILE TO THE AO TO EXAMINE THE CLAIM OF THE ASSESSEE BASED ON THE AUDITED ACCOUNTS OF THE FIRM AS WELL AS THE AUDITED ACCOUNTS OF THE INDIVIDUAL AS ON 31.03.2009 AS WELL AS EXAMINE THE EARLIER EVIDENCE OF LAW BY THE ASSESSEE, AND THEREAFTER DETERMINE WHETHER THERE IS ANY AMOUNT OF UNDISCLOSED STOCK. IN THE RESULT THIS GROUND IS ALLOWED FOR STATISTICAL PURPOSES. 4. GROUND NO. 2 IS AGAINST THE ADDITION OF RS. 46,46,308/- MADE BY THE ASSESSEE ON THE ACCOUNT OF INFLATED PURCHASES. THE AO ISSUE A NOTICE U/S 133(6) OF THE ACT TO M/S. EAST INDIA SECURITIES LTD. (DP) AND RECEIVED SOME INFORMATION. BASED ON THE REPLY RECEIVED, THE AO CONSIDERED THE NET DEBITED ITEMS OF THE LEDGER AS PURCHASES, WITHOUT LOOKING INTO THE FULL FACTS OF THE DEBITED ENTRIES. THE ASSESSEES CASE IS THAT, HE FILED COPIES OF DETAILS RECEIVED FROM THE BROKER, M/S. ISE SECURITIES & SERVICES LTD. IN RESPECT OF SALES AND PURCHASES AND HAD FILED ALL THE DETAILS WITH THE AO AND WHEREAS THE AO MISLED HIMSELF AND WRONGLY MADE THE CALCULATION ON THE BASIS OF NET DEBITS, WITHOUT GIVING COGNIZANCE TO THE CREDITS. AFTER CONSIDERING THE FINDINGS OF THE LOWER AUTHORITIES AND THE SUBMISSIONS OF THE ASSESSEE AS WELL AS THE DR, WE ARE OF THE CONSIDERED OPINION THAT THE ADDITIONAL EVIDENCES FILED IN THIS REGARD BY THE ASSESSEE BE ADMITTED AS IT GOES INTO THE ROOT OF THE MATTER AND IN OUR VIEW THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE FROM FILING THESE EVIDENCES BEFORE THE AO. THE ISSUE IS RESTORED TO THE FILE OF THE 3 I.T.A. NO. 317/KOL/2017 ASSESSMENT YEAR: 2009-10 SURAJ JHUNJHUNWALA AO FOR FRESH ADJUDICATION IN ACCORDANCE WITH LAW, AFTER CONSIDERING THE EVIDENCES FILED BY THE ASSESSEE. IN THE RESULT THIS GROUND IS ALLOWED FOR STATISTICAL PURPOSES. 5. GROUND NO. 3 IS DISMISSED AS NOT PRESSED. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED IN PART. KOLKATA, THE 18 TH OCTOBER, 2019. SD/- SD/- [S.S. GODARA] [J. SUDHAKAR REDDY] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 18.10.2019 BIDHAN COPY OF THE ORDER FORWARDED TO: 1. SURAJ JHUNJHUNWALA, 8, LOYNS RANGE, DALHOUSIE, KOLKATA-700 001. 2. ITO, WARD- 41 (3), KOLKATA. 3. CIT(A)-13, KOLKATA. (SENT THROUGH MAIL) 4. CIT- 5. CIT(DR), KOLKATA BENCHES, KOLKATA. (SENT THROUGH MAIL) TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT, KOLKATA BENCHES