ITO 16(3)(3), MUMBAI V. PRATAP L AGANANI, MUMBAI

ITA 3281/MUM/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3718 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 2 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-08-2016
• Appeal Filed By: Department
• Bench Allotted: C
• Next Hearing Date: 11-02-2016
• Assessment Year: 2005-2006
• Appeal Filed On: 08-05-2014
• Court: TRIBUNAL
• Department Lawyers: K MOHANDA S
• Section: 144

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C , BENCH MUMBAI BEFORE SHRI R.C.SHARMA, AM & SHRI PAWAN SINGH , JM ./ ITA NO. 3281 / MUM/20 1 4 ( / ASSESSMENT YEAR : 20 0 5 - 20 06 ) ITO - 16( 3)(3), MUMBAI - 400007 VS. PRATAP L. AGANANI, 2/17, NEERMAL JEEVAN CO - OP HSG, SOC., KOPARI (THANE)(EAST), MUMBAI - 400601 ./ ./ PAN/GIR NO. : A DPPA 7685 P ( / APPELLANT ) .. ( / RESPONDENT ) /REVENUE BY : SHRI K.MOHANDAS /AS SESSEE BY : NONE / DATE OF HEARING : 01 /0 8 /2016 / DATE OF PRONOUNCEMENT 03 / 0 8 /201 6 / O R D E R PER R.C.SHARMA (A.M) : TH IS IS AN APPEAL FILED BY THE REVENUE AGAIN ST THE ORDER OF CIT(A), MUMBAI, FOR THE ASSESSMENT YEAR 20 0 5 - 2006 , WHEREIN REVENUE IS AGGRIEVED FOR DELETION OF ADDITION OF RS.6,28,873/ - AND FOR DELETING ADDITION MADE ON ACCOUNT OF PROPERTY PURCHASED BY M/S SHALIMAR TEXTILES PROCESSORS BUT ADDED BY THE AO IN ASSESSEES HANDS. 2. NONE APPEARED ON BEHALF OF THE ASSESSEE, THE BENCH THEREFORE, DECIDED TO DISPOSE OFF THE APPEAL AFTER CONSIDERING THE SUBMISSION OF LD. DR AND THE MATERIAL AVAILABLE ON RECORD. FROM THE RECORD WE FOUND THAT THE ASSESSEE WAS OWNI NG TWO TRUCKS AND OFFERED ITS INCOME U/S.44AE. WITHOUT ANY REASON THE AO ENHANCED THE TURNOVER OF ASSESSEE BY ITA NO. 3281 /1 4 2 RS.6,28,873/ - . BY THE IMPUGNED ORDER, THE CIT(A) DELETED THE SAME AFTER OBSERVING AS UNDER : - 2.4.5 ON WEIGHING THE PROS AND CONS, I FIND THAT TH E LD. AO HAS NOT DOUBTED THE TOTAL TURNOVER OF RS.36,72,450/ - SHOWN BY THE APPELLANT AND, THEREFORE, BY NO STRETCH OF IMAGINATION IT COULD BE SAID THAT THE RECEIPT OF RS.6,28,873/ - DID NOT FORM PART OF HIS TURNOVER MERELY BECAUSE BREAK UP OF SALES WAS NOT PROVIDED. IT IS AN ADMITTED POSITION THAT THE APPELLANT DOES NOT MAINTAIN PROPER BOOKS OF ACCOUNTS AND, THEREFORE, TO MAKE AN ADDITION OVER AND ABOVE THE TURNOVER OF RS.36,72,450/ - WOULD BE UNREASONABLE AND ARBITRARY. ACCORDINGLY, THIS GROUND OF APPEAL IS ALLOWED. 3. WE HAVE CONSIDERED RIVAL CONTENTIONS AND DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A) FOR DELETING THE ESTIMATED ADDITION OF RS.6,28,873/ - , WHICH DOES NOT FORM PART OF TURNOVER OF THE ASSESSEE. THE ADDITION MADE ON ACCOUNT OF PURCHASE O F PROPERTY WAS DELETED BY CIT(A) AFTER HAVING FOLLOWING OBSERVATION : - 2.4.8 ON WEIGHING THE RIVAL CONTENTIONS, IT IS SEEN THAT THE APPELLANT HAD SIGNED THE ASSIGNMENT DEED AS PARTNER OF M/S. SHALIMAR TEXTILE PROCESSORS (I) PVT. LTD., AND NOT IN HIS INDIV IDUAL CAPACITY. THE ASSIGNMENT DEED DATED 13 - 09 - 2004 WAS BETWEEN THE D RT RECEIVER, DEBT RECOVERY TRIBUNAL AND PARTNERSHIP FIRM M/S. SHALIMAR TEXTILE PROCESSORS AND THUS AS FAR AS THE SOURCE OF MONEY FOR PURCHASE IS CONCERNED, THE SAME WOULD BE THE QUESTION IN THE HANDS OF THE PARTNERSHIP FIRM, M/S. SHALIMAR TEXTILE PROCESSORS, AND NOT THE PARTNER AS HE SIGNED THE ASSIGNMENT DEED ON BEHALF OF THE PARTNERSHIP FIRM. QUESTION OF FORMATION OF COMPANY BY THE NAME M/S. SHALIMAR, TEXTILE PROCESSORS (I) PVT. LTD. AN D THE SOURCE OF CAPITAL IN THE HANDS OF THAT COMPANY ARE EVIDENCES WHICH ARE NOT RELEVANT FOR FORMATION OF ANY OPINION AT THIS STAGE. LD. AO HAS MERELY MADE THE ADDITION BECAUSE THE INITIAL ADDITION WAS MADE U/S. 144 WHICH WAS ULTIMATELY SET ASIDE BY THE H ON'BLE ITAT. IN VIEW OF THE ABOVE, I AM OF THE CONSIDERED OPINION THAT NO ADDITION WAS WARRANTED IN THE HANDS OF THE APPELLANT. HOWEVER, LD. AO IS FREE TO MAKE REFERENCE TO THE ASSESSING OFFICER HAVING TERRITORIAL JURISDICTION OVER THE FIRM OR THE COMPANY. M/S. SHALIMAR TEXTILE PROCESSORS OR M/S. SHALIMAR TEXTILE PROCESSORS (I) PVT. LTD. FOR ENQUIRING INTO THE SOURCE OF MONEY FOR THE PURCHASE OF THE PROPERTY IN QUESTION. ACCORDINGLY, THIS GROUND OF APPEAL IS ALLOWED. 4. IT IS CLEAR FROM THE FINDING RECOR DED BY CIT(A) THAT PROPERTY WAS PURCHASED BY M/S SHALIMAR TEXTILES PROCESSORS (I) PVT. LTD. AND NOT BY ITA NO. 3281 /1 4 3 THE ASSESSEE IN HIS INDIVIDUAL CAPACITY. THE ASSESSEE HAS SIGNED THE DATE OF PURCHASE AS A PARTNER OF THE FIRM AND FIRM H AS PROPERLY ACCOUNTED NOT ONLY P URCHASE BUT ALSO SOURCE OF THE MONEY. WE FOUND THAT EVEN THE CIT(A) HAS GIVEN OPPORTUNITY TO THE AO TO MAKE REFERENCE TO THE AO HAVING JURISDICTION OVER THE FIRM M/S SHALIMAR TEXTILES PROCESSORS (I) PVT. LTD. FOR ENQUIRING INTO THE SOURCE OF MONEY FOR PUR CHASE OF PROPERTY IN QUESTION. THERE IS NO INFIRMITY IN THE ORDER OF CIT(A) FOR SUCH DIRECTION. 5. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. O RDER PRONOUNCED IN THE OPEN COURT ON THIS 03/08 / 201 6 . SD/ - ( PAWAN SINGH ) SD/ - ( R.C.SHA RMA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED 03/08 /201 6 . . /PKM , . / PS / COPY OF THE ORDER FORWARDED TO : / BY ORDER , / ( ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE R ESPONDENT. 3. ( ) / THE CIT(A), MUMBAI. 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. //TRUE COPY//