DEEPIKA A. MEHTA, MUMBAI V. DCIT CEN CIR, MUMBAI

ITA 3269/MUM/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 2418 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-10-2016
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Assessment Year: 1989-1990
• Appeal Filed On: 29-05-2015
• Court: TRIBUNAL
• Department Lawyers: DR P DANIEL
• Keywords: Unexplained investment

Judgement Text

, . . , IN THE INCOME TAX APPELLATE TRIBUNAL SMC , BENCH MUMBAI BEFORE SHRI R.C.SHARMA , A CCOUNTANT MEMBER ./ ITA NO . 3269 /MUM /20 1 5 ( / ASSESSMENT YEAR : 1989 - 1990 ) DEEPIKA A. M EHTA, 32, MADHULI, DR. A.B.ROAD, WORLI, MUMBAI - 400018 VS. DCIT - CC - 23 (NOW ACIT, CC - 4(1), MUMBAI ./ ./ PAN/GIR NO. : A BNPM 8231 D ( / APPELLANT ) .. ( / RESPONDENT ) /ASSESSEE BY : SHRI DHARMESH SHAH /REVENUE BY : DR. P. DANIEL, STANDING COUNSEL / DATE OF HEARING : 0 8 / 0 8 /2016 / DATE OF PRONOUNCEMENT 24 / 1 0 /201 6 / O R D E R TH IS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER O F C IT (A) FOR ASSESSMENT 1989 - 1990, IN THE MATTER OF ORDER PASSED U/S.143 R.W.S.254 OF I.T.ACT . 2. GROUND NO.1 WAS NOT PRESSED, THE SAME IS, THEREFORE, DISMISSED IN LIMINE. 3. GROUND NO.2 RELATES TO ADDITION OF RS.7,01,046/ - ON ACCOUNT OF UNEXPLAINED INVEST MENT IN SHARES AND BUSINESS OF THE COMPANY. 4. FROM THE RECORD WE FOUND THAT ADDITION WAS MADE BY THE AO ON THE BASIS OF REPORT OF THE CHARTERED ACCOUNTANT FOUND DURING THE COURSE OF SEARCH. IN THE FIRST ROUND OF APPEAL, THE TRIBUNAL HAS SET ASIDE THE MAT TER TO THE FILE OF AO WITH THE DIRECTIONS FOR MAKING FURTHER ENQUIRIES WITH THE COMPANIES. ITA NO. 3269 /2015 2 5. LD. AR DREW OUR ATTENTION TO THE ORDER PASSED BY THE TRIBUNAL IN ASSESSE ES OWN CASE IN SUBSEQUENT YEAR 1990 - 91, DATED 13 - 12 - 2007, WHEREIN THE TRIBUNAL HAD DELETE D THE ADDITION AFTER OBSERV ING AS UNDER : - 7.5 THE TRIBUNAL HAS ALREADY DIRECTED THE ASSESSING OFFICER TO MAKE INQUIRIES REGARDING THE EXACT NUMBER OF SHARES WITH THE RESPECTIVE COMPANIES. THAI HAS BEEN COMPLIED WITH BY THE ASSESSING AUTHORITY. IN MAJORITY OF THE CASES, IT HAS BEEN FOUND THAT THE SHARES ACCOUNTED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE ARE EQUAL TO OR MORE THAN THE SHARES SENT TO THE RESPECTIVE COMPANIES. IN RESPECT OF THREE COMPANIES, THERE IS SHORT HOLDING AS PER THE BOOKS OF ACCOUNT OF T HE ASSESSEE. IN THE CASE OF ANNAPURNA FOILS, THE SHORT HOLDING IS 750 SHARES, IN RESPECT OF LAXMI PRECISION; THE SHORT HOLDING IS 1000 SHARES AND IN THE CASE OF MUKUND LIMITED, THE SHORT HOLDING IS 20 SHARES. THE REVENUE HAS NOT GONE IN APPEAL AGAINST THE ORDER OF THE TRIBUNAL REGARDING THE DIRECTION THAT THE CORRECTNESS OF THE NUMBER OF SHARES BE ARRIVED AT BY VERIFYING WITH THE COMPANIES. THEREFORE, THAT DIRECTION HAS BECOME FINAL. IT IS BINDING ON THE REVENUE AUTHORITIES. 7.6 THEREFORE, WE DIRECT THE A SSESSING OFFICER TO ACCEPT THE HOLDING AS PER THE BOOKS OF THE ASSESSEE IN RESPECT OF THE COMPANIES OTHER THAN THE THREE COMPANIES. WE MENTIONED IN PARAGRAPHS ABOVE. IN RESPECT OF THOSE THREE COMPANIES, THE HOLDINGS SHOULD BE TAKEN AS PER THE DETAILS FURNI SHED BY THE COMPANIES AND THE EXCESS THEREOF AS COMPARED TO BOOKS NEEDS TO BE TREATED AS UNEXPLAINED INVESTMENT OF THE ASSESSEE. ADDITION TO THAT EXTENT IS CONFIRMED. THIS GROUND IS PARTLY ALLOWED. 6. WE HAVE CONSIDERED RIVAL CONTENTIONS AND FOUND THAT I N THE FIRST ROUND MATTER WAS RESTORED TO THE FILE OF AO WITH A DIRECTION TO MAKE ENQUIRY WITH THE RESPECTIVE COMPANIES TO FIND OUT ACTUAL HOLDING OF SHARES BY THE ASSESSEE. HOWEVER, NO ENQUIRY HAS BEEN MADE BY THE AO. THE MATTER IS MORE THAN 25 YEARS OLD, THEREFORE, NOTHING FRUITFUL WILL COME OUT EVEN IF WE AGAIN RESTORE THE MATTER BACK TO THE FILE OF AO. RESPECTFULLY FOLLOWING THE DECISION OF TRIBUNAL IN ASSESSEES OWN CASE , WE DIRECT THE AO TO DELETE THE ADDITION SO REPEATED BY HIM WITHOUT UNDERTAKING AN Y ENQUIRY SO DIRECTED BY THE TRIBUNAL IN THE FIRST ROUND. ITA NO. 3269 /2015 3 8 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. O RDER PRONOUNCED IN THE OPEN COURT ON THIS 24 / 10 / 201 6 . S D/ - ( R.C.SHARMA ) / ACCOUNTANT MEMBER MUMBAI ; DATED 24 / 1 0 /201 6 . . /PKM , . / PS / COPY OF THE ORDER FORWARDED TO : / BY ORDER, / ( ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A), MUMBAI. 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. //TRUE COPY//