Shri Bhavesh Valjibhai Maraviya, RAJKOT V. The Income Tax Officer, Ward-1 (1) (2), RAJKOT

ITA 335/RJT/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 0058 (ITAT-RAJKOT)
• Duration Of Justice: 1 year(s) 10 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-06-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2008-2009
• Appeal Filed On: 29-08-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SUHAS MISTRY
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER & MS. MADHUMITA ROY, JUDICIAL MEMBER ITA NO. 335/RJT/2018 (ASSESSMENT YEAR : 2008-09) SHRI BHAVESH VALJIBHAI MARAVIYA, 44/B, PANCHNATH SOCIETY, KALAWAD ROAD, RAJKOT VS. THE INCOME TAX OFFICER, WARD-1(1)(2), RAJKOT [PAN NO. AIH PM1 711 H] (APPELLANT) .. (RESPONDENT) APPELLANT BY : SHRI RASHMIN VEKARIYA, CA RESPONDENT BY : SHRI SUHAS MISTRY, SR. D.R. DATE OF HEARING 27.02 .20 20 DATE OF PRONOUNCEMENT 29.06.2020 O R D E R PER BENCH: THE INSTANT APPEAL FILED BY THE ASSESSEE IS DIRECTE D AGAINST THE ORDER DATED 11.06.2018 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) - 1, RAJKOT ARISING OUT OF THE ORDER DATED 25.02.2016 PASSED BY THE ITO, WA RD 1(1)(2), RAJKOT UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REF ERRED AS TO THE ACT) FOR THE ASSESSMENT YEAR (A.Y.) 2008-09. 2. THE MATTER RELATES TO ADDITION OF RS. 15,88,700/ - ON ACCOUNT OF ALLEGED UNEXPLAINED CASH DEPOSIT MADE BY THE ASSESSEE IN TH E BANK ACCOUNT. - 2 - ITA NO.335/RJT/2018 SHRI BHAVESH VALJIBHAI MARAVIYA VS. ITO ASST.YEAR 2008-09 THE FACT OF THE CASE IS THIS DURING THE RELEVANT P REVIOUS YEAR THE APPELLANT HAS MAINTAINED A SAVINGS BANK ACCOUNT WITH RAJKOT PEOPL ES CO-OPERATIVE BANK LTD., RAJKOT, FOR BUSINESS PURPOSES WHERE RS. 15,88,700/- WAS DEP OSITED. WHILE EXPLAINING SUCH DEPOSIT THE ASSESSEE THOUGH COULD PRODUCE THE RELEV ANT PAPER ONLY BEFORE THE FIRST APPELLATE AUTHORITY; THE ASSESSEE DULY SUBMITTED TH E RELEVANT DOCUMENTS BEING THE IDENTITY OF THE DEPOSITORS, GENUINENESS OF TRANSACT ION AND CREDITWORTHINESS OF THE DEPOSITORS RELATING TO THE SALE OF VEHICLES UNSECUR ED LOANS OBTAINED FROM FRIENDS AND RELATIVES. HOWEVER, THOSE EVIDENCES WERE NOT TAKIN G INTO CONSIDERATION BY THE LD. CIT(A) SINCE NO MERIT FOR NOT FURNISHING THOSE EVID ENCES BEFORE THE AO WAS FOUND BY THE LD. CIT(A). ON THAT SOLE COUNT THE ADDITION HAS BE EN CONFIRMED. 3. HOWEVER, AFTER HEARING THE LD. COUNSEL APPEARING FOR THE ASSESSEE WE FIND THAT FOR THE ENDS OF JUSTICE AN OPPORTUNITY BE GIVEN TO THE ASSESSEE TO REPRESENT HIS CASE FURTHER BEFORE THE FIRST APPELLANT AUTHORITY UPON ADDUCING THOSE EVIDENCES. ON SUCH SUGGESTION HAS BEEN CONTROVERTED BY THE LD. DR WITH ALL HIS FA IRNESS. HENCE, HAVING REGARDS TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, IN ORDER TO PREVENT THE MISCARRIAGE OF JUSTICE, WE FIND IT FIT AND PROPER TO DIRECT THE LD. AO TO CONSIDER THE ISSUE AFRESH UPON GIVING AN OPPORTUNIT Y OF HEARING TO THE ASSESSEE AND UPON CONSIDERING THE RELEVANT MATERIALS AVAILABLE BEFORE HIM AND ALSO CONSIDERING ANY OTHER DOCUMENT/EVIDENCE WHICH THE ASSESSEE MAY CHOOSE FIL E AT THE TIME OF HEARING OF THE APPEAL. HOWEVER, WE MAKE IT CLEAR THAT THE DELAY I N PREFERRING THE APPEAL BEFORE THE FIRST APPELLATE AUTHORITY IS HEREBY CONDONED. THE APPEAL IS THUS ALLOWED FOR STATISTICAL PURPOSE. 4. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE I S DISMISSED. - 3 - ITA NO.335/RJT/2018 SHRI BHAVESH VALJIBHAI MARAVIYA VS. ITO ASST.YEAR 2008-09 5. BEFORE PARTING WE WOULD LIKE TO MAKE CERTAIN OBS ERVATION RELATING TO THE ISSUE CROPPED UP UNDER PRESENT SCENARIO OF COVID-19 PANDE MIC AS TO WHETHER WHEN THE HEARING OF THE MATTER WAS CONCLUDED ON 27.02.2020 THE ORDER CAN BE PRONOUNCED TODAY I.E. ON 26.06.2020. THE ISSUE HAS ALREADY BEEN DISCUSSED B Y THE CO-ORDINATE BENCH IN THE CASE OF DCIT VS. JSW LTD. (ITA NOS. 6264 & 6103/MUM/2018 ) PRONOUNCED ON 14.05.2020 IN THE LIGHT OF WHICH IT IS WELL WITHIN THE TIME LIMIT PERMITTED UNDER RULE 34(5) OF THE APPELLATE TRIBUNAL RULES, 1963 IN VIEW OF THE FOLLO WING OBSERVATIONS MADE THEREIN: 7. HOWEVER, BEFORE WE PART WITH THE MATTER, WE MUS T DEAL WITH ONE PROCEDURAL ISSUE AS WELL. WHILE HEARING OF THESE APPEALS WAS CONCLU DED ON 8TH JANUARY 2020, THIS ORDER THEREON IS BEING PRONOUNCED TODAY ON THE DAY OF 14T H MAY, 2020, MUCH AFTER THE EXPIRY OF 90 DAYS FROM THE DATE OF CONCLUSION OF HEARING. WE ARE ALSO ALIVE TO THE FACT THAT RULE 34(5) OF THE INCOME TAX APPELLATE TRIBUNAL RULES 19 63, WHICH DEALS WITH PRONOUNCEMENT OF ORDERS, PROVIDES AS FOLLOWS: (5) THE PRONOUNCEMENT MAY BE IN ANY OF THE FOLLOWIN G MANNERS : (A) THE BENCH MAY PRONOUNCE THE ORDER IM MEDIATELY UPON THE CONCLUSION OF THE HEARING. (B) IN CASE WHERE THE ORDER IS NOT PRONO UNCED IMMEDIATELY ON THE CONCLUSION OF THE HEARING, THE BENCH SHALL GIVE A DATE FOR PRONOUNCEM ENT. (C) IN A CASE WHERE NO DATE OF PRONOUNCE MENT IS GIVEN BY THE BENCH, EVERY ENDEAVOUR SHALL BE MADE BY THE BENCH TO PRONOUNCE THE ORDER WITHIN 60 DAYS FROM THE DATE ON WHICH THE HEARING OF THE CASE WAS CONCLUDED BUT, WHERE IT IS NOT PRAC TICABLE SO TO DO ON THE GROUND OF EXCEPTIONAL AND EXTRAORDINARY CIRCUMSTANCES OF THE CASE, THE BE NCH SHALL FIX A FUTURE DAY FOR PRONOUNCEMENT OF THE ORDER, AND SUCH DATE SHALL NOT ORDINARILY (E MPHASIS SUPPLIED BY US NOW) BE A DAY BEYOND A FURTHER PERIOD OF 30 DAYS AND DUE NOTICE OF THE DAY SO FIXED SHALL BE GIVEN ON THE NOTICE BOARD. 8. QUITE CLEARLY, ORDINARILY THE ORDER ON AN APPE AL SHOULD BE PRONOUNCED BY THE BENCH WITHIN NO MORE THAN 90 DAYS FROM THE DATE OF CONCLUDING THE HEARING. IT IS, - 4 - ITA NO.335/RJT/2018 SHRI BHAVESH VALJIBHAI MARAVIYA VS. ITO ASST.YEAR 2008-09 HOWEVER, IMPORTANT TO NOTE THAT THE EXPRESSION ORD INARILY HAS BEEN USED IN THE SAID RULE ITSELF. THIS RULE WAS INSERTED AS A RESULT OF DIRE CTIONS OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF SHIVSAGAR VEG RESTAURANT VS A CIT [(2009) 317 ITR 433 (BOM)] WHEREIN THEIR LORDSHIPS HAD, INTER ALIA, DIRECTED T HAT WE, THEREFORE, DIRECT THE PRESIDENT OF THE APPELLATE TRIBUNAL TO FRAME AND LAY DOWN THE GUIDELINES IN THE SIMILAR LINES AS ARE LAID DOWN BY THE APEX COURT IN THE CASE OF ANIL RAI (SUPRA) AND TO ISSUE APPROPRIATE ADMINISTRATIVE DIRECTIONS TO ALL THE BENCHES OF THE TRIBUNAL IN THAT BEHALF. WE HOPE AND TRUST THAT SUITABLE GUIDELINES SHALL BE FRAMED AND ISSUED BY THE PRESIDENT OF THE APPELLATE TRIBUNAL WITHIN SHORTEST REASONABLE TIME AND FOLLOW ED STRICTLY BY ALL THE BENCHES OF THE TRIBUNAL. IN THE MEANWHILE(EMPHASIS, BY UNDERLINING , SUPPLIED BY US NOW), ALL THE REVISIONAL AND APPELLATE AUTHORITIES UNDER THE INCO ME-TAX ACT ARE DIRECTED TO DECIDE MATTERS HEARD BY THEM WITHIN A PERIOD OF THREE MONT HS FROM THE DATE CASE IS CLOSED FOR JUDGMENT. IN THE RULED SO FRAMED, AS A RESULT OF THESE DIRECTIONS, THE EXPRESSION ORDINARILY HAS BEEN INSERTED IN THE REQUIREMENT T O PRONOUNCE THE ORDER WITHIN A PERIOD OF 90 DAYS. THE QUESTION THEN ARISES WHETHER THE PA SSING OF THIS ORDER, BEYOND NINETY DAYS, WAS NECESSITATED BY ANY EXTRAORDINARY CIRCU MSTANCES. 9. LET US IN THIS LIGHT REVERT TO THE PREVAILING SI TUATION IN THE COUNTRY. ON 24TH MARCH, 2020, HONBLE PRIME MINISTER OF INDIA TOOK T HE BOLD STEP OF IMPOSING A NATIONWIDE LOCKDOWN, FOR 21 DAYS, TO PREVENT SPREAD OF COVID 19 EPIDEMIC, AND THIS LOCKDOWN WAS EXTENDED FROM TIME TO TIME. AS A MATTE R OF FACT, EVEN BEFORE THIS FORMAL NATIONWIDE LOCKDOWN, THE FUNCTIONING OF THE INCOME TAX APPELLATE TRIBUNAL AT MUMBAI WAS SEVERELY RESTRICTED ON ACCOUNT OF LOCKDOWN BY T HE MAHARASHTRA GOVERNMENT, AND ON ACCOUNT OF STRICT ENFORCEMENT OF HEALTH ADVISORIES WITH A VIEW OF CHECKING SPREAD OF COVID 19. THE EPIDEMIC SITUATION IN MUMBAI BEING GR AVE, THERE WAS NOT MUCH OF A RELAXATION IN SUBSEQUENT LOCKDOWNS ALSO. IN ANY CAS E, THERE WAS UNPRECEDENTED DISRUPTION OF JUDICIAL WOK ALL OVER THE COUNTRY. AS A MATTER O F FACT, IT HAS BEEN SUCH AN UNPRECEDENTED SITUATION, CAUSING DISRUPTION IN THE FUNCTIONING OF JUDICIAL MACHINERY, THAT - 5 - ITA NO.335/RJT/2018 SHRI BHAVESH VALJIBHAI MARAVIYA VS. ITO ASST.YEAR 2008-09 HONBLE SUPREME COURT OF INDIA, IN AN UNPRECEDENTED ORDER IN THE HISTORY OF INDIA AND VIDE ORDER DATED 6.5.2020 READ WITH ORDER DATED 23. 3.2020, EXTENDED THE LIMITATION TO EXCLUDE NOT ONLY THIS LOCKDOWN PERIOD BUT ALSO A FE W MORE DAYS PRIOR TO, AND AFTER, THE LOCKDOWN BY OBSERVING THAT IN CASE THE LIMITATION HAS EXPIRED AFTER 15.03.2020 THEN THE PERIOD FROM 15.03.2020 TILL THE DATE ON WHICH THE L OCKDOWN IS LIFTED IN THE JURISDICTIONAL AREA WHERE THE DISPUTE LIES OR WHERE THE CAUSE OF A CTION ARISES SHALL BE EXTENDED FOR A PERIOD OF 15DAYS AFTER THE LIFTING OF LOCKDOWN. HO NBLE BOMBAY HIGH COURT, IN AN ORDER DATED 15TH APRIL 2020, HAS, BESIDES EXTENDING THE V ALIDITY OF ALL INTERIM ORDERS, HAS ALSO OBSERVED THAT, IT IS ALSO CLARIFIED THAT WHILE CAL CULATING TIME FOR DISPOSAL OF MATTERS MADE TIME-BOUND BY THIS COURT, THE PERIOD FOR WHICH THE ORDER DATED 26TH MARCH 2020 CONTINUES TO OPERATE SHALL BE ADDED AND TIME SHALL STAND EXTENDED ACCORDINGLY, AND ALSO OBSERVED THAT ARRANGEMENT CONTINUED BY AN ORDER DA TED 26TH MARCH 2020 TILL 30TH APRIL 2020 SHALL CONTINUE FURTHER TILL 15TH JUNE 2020. IT HAS BEEN AN UNPRECEDENTED SITUATION NOT ONLY IN INDIA BUT ALL OVER THE WORLD. GOVERNME NT OF INDIA HAS, VIDE NOTIFICATION DATED 19TH FEBRUARY 2020, TAKEN THE STAND THAT, THE CORON A VIRUS SHOULD BE CONSIDERED A CASE OF NATURAL CALAMITY AND FMC (I.E. FORCE MAJEURE CLAUSE ) MAY BE INVOKED, WHEREVER CONSIDERED APPROPRIATE, FOLLOWING THE DUE PROCEDURE . THE TERM FORCE MAJEURE HAS BEEN DEFINED IN BLACKS LAW DICTIONARY, AS AN EVEN T OR EFFECT THAT CAN BE NEITHER ANTICIPATED NOR CONTROLLED WHEN SUCH IS THE POSITI ON, AND IT IS OFFICIALLY SO NOTIFIED BY THE GOVERNMENT OF INDIA AND THE COVID-19 EPIDEMIC H AS BEEN NOTIFIED AS A DISASTER UNDER THE NATIONAL DISASTER MANAGEMENT ACT, 2005, AND ALS O IN THE LIGHT OF THE DISCUSSIONS ABOVE, THE PERIOD DURING WHICH LOCKDOWN WAS IN FORC E CAN BE ANYTHING BUT AN ORDINARY PERIOD. 10. IN THE LIGHT OF THE ABOVE DISCUSSIONS, WE ARE OF THE CONSIDERED VIEW THAT RATHER THAN TAKING A PEDANTIC VIEW OF THE RULE REQUIRING P RONOUNCEMENT OF ORDERS WITHIN 90 DAYS, DISREGARDING THE IMPORTANT FACT THAT THE ENTIRE COU NTRY WAS IN LOCKDOWN, WE SHOULD COMPUTE THE PERIOD OF 90 DAYS BY EXCLUDING AT LEAST THE PERIOD DURING WHICH THE - 6 - ITA NO.335/RJT/2018 SHRI BHAVESH VALJIBHAI MARAVIYA VS. ITO ASST.YEAR 2008-09 LOCKDOWN WAS IN FORCE. WE MUST FACTOR GROUND REALIT IES IN MIND WHILE INTERPRETING THE TIME LIMIT FOR THE PRONOUNCEMENT OF THE ORDER. LAW IS NOT BROODING OMNIPOTENCE IN THE SKY. IT IS A PRAGMATIC TOOL OF THE SOCIAL ORDER. TH E TENETS OF LAW BEING ENACTED ON THE BASIS OF PRAGMATISM, AND THAT IS HOW THE LAW IS REQUIRED TO INTERPRETED. THE INTERPRETATION SO ASSIGNED BY US IS NOT ONLY IN CONSONANCE WITH THE L ETTER AND SPIRIT OF RULE 34(5) BUT IS ALSO A PRAGMATIC APPROACH AT A TIME WHEN A DISASTER, NOT IFIED UNDER THE DISASTER MANAGEMENT ACT 2005, IS CAUSING UNPRECEDENTED DISRUPTION IN TH E FUNCTIONING OF OUR JUSTICE DELIVERY SYSTEM. UNDOUBTEDLY, IN THE CASE OF OTTERS CLUB VS DIT [(2017) 392 ITR 244 (BOM)], HONBLE BOMBAY HIGH COURT DID NOT APPROVE AN ORDER BEING PASSED BY THE TRIBUNAL BEYOND A PERIOD OF 90 DAYS, BUT THEN IN THE PRESENT SITUATION HONBLE BOMBAY HIGH COURT ITSELF HAS, VIDE JUDGMENT DATED 15TH APRIL 2020, HE LD THAT DIRECTED WHILE CALCULATING THE TIME FOR DISPOSAL OF MATTERS MADE TIME-BOUND BY THI S COURT, THE PERIOD FOR WHICH THE ORDER DATED 26TH MARCH 2020 CONTINUES TO OPERATE SH ALL BE ADDED AND TIME SHALL STAND EXTENDED ACCORDINGLY. THE EXTRAORDINARY STEPS TAKE N SUO MOTU BY HONBLE JURISDICTIONAL HIGH COURT AND HONBLE SUPREME COURT ALSO INDICATE THAT THIS PERIOD OF LOCKDOWN CANNOT BE TREATED AS AN ORDINARY PERIOD DURING WHICH THE N ORMAL TIME LIMITS ARE TO REMAIN IN FORCE. IN OUR CONSIDERED VIEW, EVEN WITHOUT THE WOR DS ORDINARILY, IN THE LIGHT OF THE ABOVE ANALYSIS OF THE LEGAL POSITION, THE PERIOD DU RING WHICH LOCKOUT WAS IN FORCE IS TO EXCLUDED FOR THE PURPOSE OF TIME LIMITS SET OUT IN RULE 34(5) OF THE APPELLATE TRIBUNAL RULES, 1963. VIEWED THUS, THE EXCEPTION, TO 90-DAY TIME-LIMIT FOR PRONOUNCEMENT OF ORDERS, INHERENT IN RULE 34(5)(C), WITH RESPECT TO THE PRONOUNCEMENT OF ORDERS WITHIN NINETY DAYS, CLEARLY COMES INTO PLAY IN THE PRESENT CASE. OF COURSE, THERE IS NO, AND THERE CANNOT BE ANY, BAR ON THE DISCRETION OF THE BENCHES TO REFIX THE MATTERS FOR CLARIFICATIONS BECAUSE OF CONSIDERABLE TIME LAG BETWEEN THE POINT OF TIME WHEN THE HEARING IS CONCLUDED AND THE POINT OF TIME WHEN THE ORDER THEREON IS BEI NG FINALIZED, BUT THEN, IN OUR CONSIDERED VIEW, NO SUCH EXERCISE WAS REQUIRED TO B E CARRIED OUT ON THE FACTS OF THIS CASE. - 7 - ITA NO.335/RJT/2018 SHRI BHAVESH VALJIBHAI MARAVIYA VS. ITO ASST.YEAR 2008-09 6. ON THE BASIS OF THE OBSERVATION MADE IN THE AFOR ESAID JUDGMENT WE EXCLUDE THE PERIOD OF LOCKDOWN WHILE COMPUTING THE LIMITATION P ROVIDED UNDER RULE 34(5) OF THE INCOME TAX (APPELLATE TRIBUNAL) RULE 1963. ORDER I S, THUS, PRONOUNCED IN THE OPEN COURT. 7. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE I S DISMISSED. THIS ORDER PRONOUNCED IN OPEN COURT ON 29/06/2020 SD/- SD/- ( WASEEM AHMED ) ( MS. MAD HUMITA ROY ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 29/06/2020 TANMAY, SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A) 5. , , ! /DR,ITAT, RAJKOT 6. '# $% / GUARD FILE. / BY ORDER, //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , ! / ITAT, RAJKOT 1. DATE OF DICTATION 28.02.2020 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 02 .03.2020 3. OTHER MEMBER. 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S 25.06.2020 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S. 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 29.06.2020 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER