ITO 19(1)(1), MUMBAI V. MILAN H HARIA, MUMBAI

ITA 3215/MUM/2013

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3184 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 4 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-09-2016
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 01-09-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 26-04-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: VINITA MENON
• Keywords: Unexplained investment; Additional evidence
• Section: 143(3); 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH , MUMBAI BEFORE SRI MAHAVIR SINGH, J M AND SRI B. R. BASKARAN, AM ITA NO . 3215 /MUM/201 3 (A.Y:200 9 - 10 ) THE INCOME TAX OFFICER - 19(1)(1), ROOM NO.319, PIRAMAL CHAMBERS, PAREL, MUMBAI 400 012 VS. SHRI MILAN H. HA RIA, FLAT NO .1602,LOKNIRMAN BUILDING, A - 4, WING, AMBEDKAR ROAD, KHAR (W), MUMBAI 400 052 PAN:ABCPH 9081K APPELLANT .. RESPONDENT APPELLANT BY .. SMT. VINITA MENON, DR RESPONDENT BY .. NONE DATE OF HEARING .. 01 - 09 - 2016 DATE OF PRONOUNCEMENT .. 01 - 09 - 2016 O R D E R PER MAHAVIR SINGH , JM : THIS APPEAL BY THE REVENUE IS ARISING OUT OF T HE ORDER OF THE CIT (APPEALS) - 30, MUMBAI IN APPEAL NO.CIT (A) - 30/ITO 19(1)(1)/IT - 116/11 - 12 DATED 14 - 02 - 2013. ASSESSMENT WAS FRAMED BY THE ITO,WARD - 19(1) (1), MUM BAI FOR ASSESSMENT YEAR 2009 - 10 U/S 143(3) READ WITH SECTION 144 OF THE INCOME TAX ACT, 1961 (HEREINAFTER THE ACT) VIDE HIS ORDER DATED 07 - 12 - 2011. 2. AT THE OUTSET, THE LEARNED SR. DR POINTED OUT THAT THE CIT (A) WHILE RESTRICTING THE ADDITION TO RS .3,84,499/ - AS AGAINST THE ADDITION MADE BY THE AO OF RS.54,39,732/ - ON ACCOUNT OF UNEXPLAINED INVESTMENT AND RESTRICTING TO RS.2,48,376/ - AS AGA INST THE ADDITION MADE BY THE A O AT RS.29,88,262/ - ON ACCOUNT OF UNEXPLAINED ADDITION TO FIXED ASSET BY ADMITTI NG NEW FACTS AND CIRCUMSTANCES IN CONTRAVENTION TO RULE 46A OF THE INCOME TAX RULES, 1962 (HEREINAFTER THE RULES). SIMILARLY, ACCORDING TO HER, THE CIT (A) ALSO DELETED THE DISALLOWANCE OF RENT PAID BY THE ASSESSEE WITHOUT DEDUCTING TDS BY ADMITTING NEW EVIDENCES AND ALSO DELETION OF ADDITION OF UNEXPLAINED INVESTMENT TO CAPITAL ACCOUNT AMOUNTING TO RS.14.90 LACS AND ADDITION OF RS.13,81,499/ - ON ACCOUNT OF DIFFERENCE IN CAPITAL BY ADMITTING NEW EVIDENCES IN CONTRAVENTION TO RULE 46A OF THE RULES. THE LEA RNED SR. DR DREW OUR ATTENTION TO GROUNDS NO.1 TO 4 OF THE REVENUES APPEAL WHICH READ AS UNDER: - ITA NO. 321 5 /MUM/20 1 3 2 1. THAT THE LEARNED CIT(A) HAS ERRED IN RESTRICTING THE ADDITION TO RS.384,499/ - AS AGAINST OF RS.54,39,732/ - ON ACCOUNT OF UNEXPLAINED INVESTMENT AND RS.24 8,376/ - AS AGAINST RS.29,88,262 / - ON ACCOUNT OF UNEXPLAINED ADDITION TO FIXED ASSETS RESPECTIVELY ADMITTING NEW EVIDENCES WHICH WERE NOT FILED DURING THE ASSESSMENT PROCEEDINGS WHICH IS IN CONTRAVENTION TO RULE 46A OF THE I. T. RULE. 2. THAT THE LEARNED CIT (A) HAS ERRED IN DELETING THE DISALLOWANCE OF RS.418,000/ - BEING RENT PAID WITHOUT DEDUCTION OF TAX AT SOURCE ADMITTING NEW EVIDENCES WHICH WERE NOT FILED DURING THE ASSESSMENT PROCEEDINGS WHICH IS IN CONTRAVENTION TO RULE 46A OF THE I. T. RULE. 3. TH AT THE LEARNED CIT (A) HAS ERRED IN DELETING THE ADDITION OF RS.14,90,000/ - AS UNEXPLAINED INVESTMENT BEING ADDITION TO CAPITAL OF PROPRIETOR AND ADDITION OF RS.13,81,499/ - ON ACCOUNT OF DIFFERENCE IN CAPITAL RESPECTIVELY ADMITTING NEW EVIDENCES WHICH WERE NOT FILED DURING THE ASSESSMENT PROCEEDINGS WHICH IS IN CONTRAVENTION TO RULE 46A OF THE I. T. RULE. 4. THAT THE LEARNED CIT (A) HAS ERRED IN IGNORING THAT CONDITIONS AS SPECIFIED IN RULE 46A (1) OF THE I T RULE FOR ADMISSION OF THE ADDITIONAL EVIDENCES WERE NOT SATISFIED, WITHOUT GIVING ANY FINDING THAT THE CONDITIONS PRESCRIBED IN RULE 46A (1) OF THE I T RULE, 1962 HAVE BEEN FULFILLED BY THE APPELLANT TO JUSTIFY PRODUCTION OF EVIDENCES NOT FILED DURING THE ASSESSMENT PROCEEDINGS. THE LEARNED SR. DR ALSO POINTED OUT THAT THE ASSESSMENT FRAMED BY THE ASSESSING OFFICER WAS EX - PARTE U/S 144 OF THE ACT DUE TO NON - REPRESENTATION OF THE ASSESSEE AS REASONS RECORDED IN THE ASSESSMENT ORDER. SHE STATED THAT THE ASSESSING OFFICER HAS NO ALTERNATIVE AS HE HAS A LLOWED NUMBER OF OPPORTUNITIES IN FINAL SHOW - CAUSE NOTICES ISSUED ON VARIOUS OCCASIONS. ACCORDING TO THE LEARNED SR. DR, THE CIT (A) ADMITTED ALL THE NEW EVIDENCES LIKE INDIVIDUAL BALANCE SHEETS OF THE PROPRIETOR, DETAILS OF ADDITION TO FIXED ASSETS, SOURC ES OF CAPITAL ACCRETION WITHOUT VERIFICATION OF THE AO. EVEN BEFORE US, THE ASSESSEE HAS NOT REPRESENTED EVEN ON ONE OCCASION DESPITE SERVICES OF NOTICES FOR 2/3 TIMES. WE HAVE GONE THROUGH THE ORDER OF THE CIT (A) AND THAT OF THE AO AND NOTICED THAT THE A SSESSEE WAS AT FAULT FOR NOT REPRESENTING BEFORE THE AO AS THE AO ISSUED VARIOUS NOTICES U/S 143 ( 2) READ WITH SECTION 14 2 (1) OF THE ACT AND FINAL OPPORTUNITY SHOW - CAUSE NOT ICE DATED 14 - 10 - 2011 WAS I SSUED, NONE REPRESENTED. AGAIN, FINAL OPPORTUNITY SHOW - C AUSE NOTICE DATED 01 - 11 - 2011 WAS ISSUED ALONG WITH DRAFT ASSESSMENT ORDER WHICH WAS SERVED ON THE ASSESSEE ON 01 - 11 - 2011, FIXING T HE CASE ON 11 - 11 - 2011. THE AO ALSO MENTIONED THAT THE ASSESSMENT IS GETTING ITA NO. 321 5 /MUM/20 1 3 3 TIME BARRED ON 31 - 12 - 2011, BUT THERE WAS NO COMPL IANCE. AGAIN, A FINAL OPPORTUNITY LETTER DATED 23 - 11 - 2011 WAS ISSUED AND SERVED ON THE ASSESSEE ON 26 - 11 - 2011 FIXING THE CASE FOR 05 - 12 - 2011. AS NO ALTERNATIVE WAS LEFT WITH THE ASSESSING OFFICER, HE ESTIMATED THE INCOME ON THE BASIS OF THE MATERIALS AVAIL ABLE ON RECORD AND COMPLETED THE ASSESSMENT EX - PARTE. WE FIND THAT THE CIT (A) HAS ALSO NOT EXAMINED THE EVIDENCES OR NEVER REMANDED THE MATTER BACK TO THE FILE OF THE AO, DESPITE NEW EVIDENCES WERE PRODUCED BEFORE HER. IN SUCH CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE ISSUE NEEDS VERIFICATION IN ITS ENTIRETY AND HENCE, WE SET ASIDE THE ORDERS OF THE LOWER AUTHORITIES I.E. THAT OF THE AO AND THE CIT (A) AND REMAND THE MATTER BACK TO THE AO DE NOVO. ACCORDINGLY, THE APPEAL OF THE REVENUE IS TREATED AS ALLOW ED FOR STATISTICAL PURPOSES. 3. IN THE RESULT, THE APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 01 - 09 - 2016 . BY ORDER, ASSISTANT REGISTRAR ITAT, MUMBAI SD/ - (B. R. BASKARAN) ACCONTANT MEMBER MUMBAI, DATED: 01 - 09 - 2016 LAKSHMIKANTA DEKA/SR.PS SD/ - ( MAHAVIR SINGH ) JUDICIAL MEMBER COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT (A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY// ITA NO. 321 5 /MUM/20 1 3 4 SR.NO. PARTICULARS DATE INITIALS MEMBER CONCERNED 1 DICTATION GIVEN ON 06 /09/16 LK DEKA JM 2 DRAFT PLACED BEFORE AUTHOR 07/09/16 08/09/16 3 DRAFT PROPOSED/PLACED BEFORE THE SECOND MEMBER 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 5 APPROVED DRAFT COMES TO THE SR.PS 6 KEPT FOR PRONOUNCEMENT ON 7 FILE SENT TO THE BENCH CLERK 8 DATE ON WHICH FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER