SOHIL SOLANKI, MUMBAI V. ITO 32(3)(4), MUMBAI

ITA 3171/MUM/2017

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8900 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 02-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V VIDHYADHAR
• Assessee Lawyers: JATIN TANK
• Keywords: Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL 'I' BENCH, MUMBAI BEFORE SHRI P K BANSAL, VICE PRESIDENT AND SHRI PAWAN SINGH, JUDICIAL MEMBER ITA NO.3171 /MUM/2017 (ASSESSMENT YEAR: 2011-12) MR. SOHIL SOLANKI VS. INCOME TAX OFFICER - 32(3)(4) SHOP NO . 6 & 7, PANDIT CHAWL CARTER ROAD NO. 3, BORIVALI (E) MUMBAI 400066 MUMBAI PAN AQNPS7767D APPELLANT RESPONDENT APPELLANT BY: SHRI JATIN TANK RESPONDENT BY: SHRI V. VIDHYADHAR DATE OF HEARING: 06.09.2017 DATE OF PRONOUNCEMENT: 23.10.2017 O R D E R PER P.K. BANSAL, VICE PRESIDENT THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A)-44, MUMBAI DATED 14.02.2017 FOR A.Y. 2011-12 BY TAKING THE FOLLOWING EFFECTIVE GROUND OF APPEAL: - 1) THE LD. C.I.T. (APPEAL) ERRED IN CONFIRMING ADS OF RS.14,04,320/- AS UNPROVED EXPENSES AND RS.1,00,000/- AS UNEXPLAIN ED BROKERAGE EXPENSES AS PER THE INCOME TAX ACT, 1961. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE AO NOTED T HAT THE ASSESSEE WHILE CALCULATING THE PROFIT ON SALE OF PROPERTY SH OWN COST OF CONSTRUCTIONS EXCLUDING COST OF LAND AT ` 58,32,742/-. THE AO FOUND THAT THE ASSESSEE CLAIMED PAINTING WORK CHARGES, ELECTRICAL & FIXTURE S, OTHER PURCHASES AND WAGES PAID TOTALLING TO ` 14,04,320/-. THE AO WAS OF THE VIEW THAT WHEN THE ASSESSEE HAS ALREADY INCURRED EXPENSES FOR GETTING THE MAJOR CONTRACT WORK THROUGH M/S. UNITED CONSTRUCTION COMPANY AND NARAYA N CONTRACTOR WHO WHOM A SUMS OF ` 25,34,542/- AND ` 11,45,680/- RESPECTIVELY PAID THERE IS NO REASON FOR INCURRING THESE ADDITIONAL EXPENSES A ND THEREFORE HE ADDED ITA NO. 3171/MUM/2017 MR. SOHIL SOLANKI 2 THE SAME AS UNPROVED EXPENSES. WHEN THE MATTER WENT BEFORE THE CIT(A), THE CIT(A) CONFIRMED THE SAID ADDITION. AGGRIEVED, ASSESSEE IS IN APPEAL BEFORE US. 3. AFTER HEARING THE RIVAL SUBMISSIONS AND GOING THROU GH THE ORDERS OF THE TAX AUTHORITIES BELOW WE NOTED THAT THE ASSESSE E HAS SUBMITTED BILLS AND VOUCHERS RELATED TO THE EXPENSES DISALLOWED BY THE AO AS APPEARING FROM PARA 3.2 OF THE ORDER THE CIT(A). THE CIT(A) D ID NOT CONSIDER THESE EVIDENCES AS IN HIS OPINION NO ADDITIONAL EVIDENCE COULD HAVE BEEN FILED BY THE ASSESSEE BEFORE HIM UNLESS THE ASSESSEE IS COVE RED BY EXCEPTIONS PROVIDED IN RULE 46A. WE NOTED THAT THE SAID DISALL OWANCE HAVE BEEN MADE BY THE AO MERELY ON THE BASIS THAT SINCE THE ASSESS EE HAS GIVEN THE CONSTRUCTION WORK ON CONTRACT AND THE MAJOR CONTRAC T WORK HAS BEEN CARRIED OUT BY CONTRACTOR M/S. UNITED CONSTRUCTION CO. AND NARAYAN CONTRACTOR TO WHOM ASSESSEE HAS MADE SEPARATE PAYME NTS, THE ASSESSEE NEED NOT TO INCUR ADDITIONAL EXPENSES. IN OUR VIEW THE DISALLOWANCE WAS MADE BY THE AO MERELY ON PRESUMPTIONS WITHOUT BRING ING ANY EVIDENCE ON RECORD. EVEN THE CIT(A) DID NOT TOOK THE DETAILS OF SUCH EXPENSES ON RECORD WHILE THE DETAILS OF SUCH EXPENSES, IN OUR VIEW WAS NECESSARY TO ADJUDICATE THIS ISSUE AND THE AO HAS NEVER ASKED THE ASSESSEE FOR SUBMISSION OF EVIDENCES. WE, THEREFORE, DELETE THE SAID DISALLOWA NCE. 4. THE SECOND ISSUE RELATES TO BROKERAGE EXPENSES PAID AMOUNT TO ` 1,00,000/-. AFTER HEARING THE RIVAL SUBMISSIONS AND GOING THROUGH THE ORDERS OF THE TAX AUTHORITIES BELOW WE NOTED THAT T HE AO DISALLOWED THE SAID EXPENDITURE AS THE ASSESSEE COULD NOT FILE ANY DETAILS OF SUCH EXPENSES. WHEN THE MATTER WENT BEFORE HE CIT(A), TH E CIT(A) HAS NOT SEPARATELY DEALT WITH THIS ISSUE AND CONFIRMED THE ORDER OF THE AO. WE, THEREFORE, IN THE INTEREST OF JUSTICE AND FAIR PLAY TO BOTH THE PARTIES SET ASIDE THIS ISSUE TO THE FILE OF THE AO WITH THE DIR ECTION THAT THE AO SHALL REDECIDE THIS ISSUE AFRESH AFTER GIVING OPPORTUNITY TO THE ASSESSEE TO PRODUCE NECESSARY EVIDENCES AND DETAILS OF PROOF IN RESPECT OF THESE EXPENSES. THUS THIS, GROUND IS ALLOWED FOR STATISTI CAL PURPOSES. ITA NO. 3171/MUM/2017 MR. SOHIL SOLANKI 3 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 23 RD OCTOBER, 2017. SD/ - SD/ - (PAWAN SINGH) (P.K. BANSAL) JUDICIAL MEMBER VICE PRESIDENT MUMBAI, DATED: 23 RD OCTOBER, 2017 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) -44, MUMBAI 4. THE CIT - 32, MUMBAI 5. THE DR, I BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.