DY. COMM. OF INCOME TAX, CIRCLE -2, KALYAN V. KUMAR U. AILANI, ULHASNAGAR

ITA 3401/MUM/2014

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 3675 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-01-2016
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2006-2007
• Appeal Filed On: 12-05-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Additional evidence
• Section: 143(3); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUM BAI BEFORE SHRI SHAILENDRA KUMAR YADAV, JM AND SHRI RAJESH KUMAR, AM ./ I.T.A. NO. 3401/MUM/2014 ( / ASSESSMENT YEAR: 2006-07) DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE-2, KALYAN, 2 ND FLOOR, MOHAN PLAZA, WAYALE NAGAR, KHADAKPADA, KALYAN (W). / VS. SHRI. KUMAR U. AILANI 2 ND FLOOR, LAXMI PALACE, OPP. SAPNA GARDEN, ULHASNAGAR 421 003. ./ ./PAN/GIR NO. ACKPA 3312R ( /APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI SATYA PAL KUMAR / RESPONDENT BY : NONE / DATE OF HEARING : 05/11/2015 !'# / DATE OF PRONOUNCEMENT : 15/01/2016 $% / O R D E R PER RAJESH KUMAR, A. M: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 20.02.2014 OF COMMISSIONER OF INCOME TAX (APPEALS)-II, MUMBAI (HE REINAFTER CALLED AS THE CIT(A) ) FOR ASSESSMENT YEAR 2006-07.THE ASSESSEE HAS RAIS ED FOLLOWING GROUNDS OF APPEAL: 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT (A)-II, THANE, HAS ERRED IN ADMITTING NEW EVIDENCE FILED BEFORE THE AO AFTER THE 2 ITA NO.3401/MUM/2014 DCIT VS. SHRI. KUMAR U. AILANI ASSESSMENT ORDER WAS PASSED WITHOUT CALLING FOR THE REPORT OF THE AO WHICH IS NOT IN ACCORDANCE WITH RULE 46A OF THE I.T. RULES 1 962. 2. THE ONLY GROUND RAISED BY THE REVENUE IS AGAINST ADMITTING THE NEW EVIDENCES BY THE CIT(A) WHICH ARE NOT IN ACCORDANCE WITH THE RULE 46A OF THE I.T. RULES 1962. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE F ILED HIS RETURN OF INCOME ON 27.03.2007 DECLARING TOTAL INCOME OF RS.36,74,105/- . THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND NOTICES U/S 143(2)& 142(1 ) OF THE ACT WERE DULY ISSUED UPON THE ASSESSEE. DURING THE COURSE OF SURVEY ON 20.0 2.2008 SOME DISCREPANCIES WERE FOUND AND THE IN CONSEQUENCE THE ASSESSEE OFFERED R S.24,94,613/- AS INCOME VOLUNTARILY. THE ASSESSEE HAD FILED ITS RETURN OF I NCOME TAX ACCORDINGLY. THEREAFTER THE AO FRAMED THE ASSESSMENT U/S 143(3) AT RS.56,52,105 /- VIDE ORDER DATED 24.12.2008 BY ADDING UNSECURED LOANS TO THE TUNE OF RS.19,78,0 00/- AS PER DETAIL BELOW. 1. SHRI DINESH WADHWANI (HUF) RS.2,00,000/- 2. SHRI DINESH WADHWANI (INDL) RS.4,90,000/- 3. SMT. NEELU WADHWANI RS.6,50,000/- 4. SMT. RINKU CHANCHLANI RS.5,00,000/- 5. SHRI DEEPAK WADHWANI RS.1,38,000/- TOTAL RS.19,78,000/- ========== THE ABOVE UNSECURED LOANS WAS ADDED TO THE INCOME O F THE ASESSEE ON THE GROUND THAT ASSESSEE COULD NOT PROVED THE CREDITWOR THINESS AND GENUINENESS OF THE 3 ITA NO.3401/MUM/2014 DCIT VS. SHRI. KUMAR U. AILANI TRANSACTIONS TO THE SATISFACTION OF THE AO AND THE REQUIREMENTS OF SECTION 68 OF THE IT ACT WERE ALSO NOT SATISFIED DESPITE THE SEVERAL OPP ORTUNITIES. THE LD. CIT(A) ALLOWED THE APPEAL OF THE ASSESSEE BY HOLDING THAT ALL THES E ADVANCES WERE RECEIVED BY A/C PAYEE CHEQUES AND THE GENUINENESS OF ALL THE TRANSA CTIONS WAS PROVED BY THE ASSESSEE AND THEREFORE, THE PROVISION OF SECTION 68 OF THE A CT WERE NOT APPLICABLE. 3. THE LD. DR AT THE OUTSET BROUGHT TO OUR NOTICE T HAT SHRI.DINESH WADHWANI, DINESH WADHWANI HUF & SMT. NEELU WADHWANI HAD FILED LETTERS IN THE OFFICE OF ADD CIT, RANGE-2, KALYAN ON 29.12.2008 STATING THAT AMOUNT WERE PAID TO THE ASSESSEE IN RESPECT OF THE PURCHASE OF SHARES FROM M/S. KUMAR PLAZA RESORTS LTD AND THE PAYMENTS WERE DULY SHOWN AS INVESTMENTS IN THEIR RESPECTIVE CASE HOWEVER THE ASSESSEE HAD INCORRECTLY SHOWN SUCH PAYMENTS AS LOA NS. WHEREAS THE ASSESSMENT ORDER WAS PASSED ON 24.12.2008 EXACTLY 5 DAYS BEFOR E THE DATE OF CONFIRMATION LETTERS FILED BY WADHWANIS. THE ABOVE DETAILS/ REPL Y/ EXPLANATION COULD NOT BE CONSIDERED BY THE AO AS THESE WERE FILED AFTER PASS ING THE ASSESSMENT ORDER. THE LD. DR FURTHER SUBMITTED THAT THE ADMISSION BY THE CIT(A) OF THESE EVIDENCES WITHOUT CALLING FOR REPORT OF THE AO ACCOUNTED TO A DMISSION OF ADDITIONAL EVIDENCES. IT WAS NOT IN ACCORDANCE WITH RULE 46A O F THE IT ACT, 1962. THE LD. DR FINALLY PRAYED THAT IN THE INTEREST OF JUSTICE, THE ISSUE TO BE RESTORED TO THE FILE OF THE CIT(A) TO ALLOW A REASONABLE OPPORTUNITY TO THE AO TO COMMENT ON THESE 4 ITA NO.3401/MUM/2014 DCIT VS. SHRI. KUMAR U. AILANI EVIDENCES. THE LD. AR ON THE OTHER HAND STRONGLY OB JECTED TO THE SUBMISSIONS BY THE DR ON THE GROUND THAT THE POWERS OF THE CIT(A) IS CO-TERMINUS WITH THAT OF THE AO AND THE ORDER PASSED BY THE CIT(A) WAS PERFE CT AND AS PER THE PROVISIONS OF THE ACT AND PRAYED FOR UPHOLDING THE SAME. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. WE FIND FROM THE RECORDS THAT SHRI. DINESH WADHWANI (INDL.), SHRI.DINESH WADHWAN I (HUF) & SMT. NEELU WADHWANI HAD FILED COPIES LETTER S CONFIRMING THEIR TRANSACTIONS WITH THE ASSESSEE ON 29.12.2008 IN THE OFFICE OF AD D. CIT, RANGE-2, KALYAN ALONG WITH THE NECESSARY DETAILS IN RESPECT OF THE AMOUNT GIVEN TO THE ASSESSEE WHEREAS THE ASSESSMENT ORDER WAS PASSED ON 24.12.2008 MEANI NG THEREBY THE ASSESSMENT ORDER WAS PASSED 5 DAYS BEFORE THE DATE OF FILING C ONFIRMATIONS. THE LD. CIT(A) DELETED THE ADDITIONS BY RELYING ON THE EVIDENCES FILED BY THE LOAN CREDITORS ON 29.12.08 WITHOUT CALLING FOR ANY REMAND REPORT FRO M THE AO AND WITHOUT GIVING THE AO AN OPPORTUNITY TO PRESENT HIS VIEWS ON THE M ATTER. IN OUR OPINION THE INTEREST OF THE JUSTICE WOULD BE MET IF THE AO IS A LLOWED AN OPPORTUNITY OF BEING HEARD TO COMMENT ON THE EVIDENCES FILED BY THE VARI OUS CREDITORS AFTER THE DATE OF THE ASSESSMENT ORDER. WE THEREFORE WITHOUT COMMENTI NG ON THE MERIT RESTORE THE ISSUE BACK TO THE FILE OF THE CIT(A) WITH THE DIREC TION TO ALLOW THE REASONABLE 5 ITA NO.3401/MUM/2014 DCIT VS. SHRI. KUMAR U. AILANI OPPORTUNITY TO THE AO TO OFFER HIS COMMENTS ON THE SAID LETTERS AND TAKE AN APPROPRIATE DECISION ON THE BASIS OF FACTS BEFORE H IM AS PER LAW. IN THE RESULT, THE APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 15TH JANUARY, 2016 SD/- SD/- (SHAILENDRA KUMAR YADAV) (RAJESH KUMAR) &' $ / JUDICIAL MEMBER $ / ACCOUNTANT MEMBER ( ) MUMBAI; *$ DATED :15.01.2016 PS. ASHWINI GAJAKOSH / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. + ( ) / THE CIT(A) 4. + / CIT CONCERNED 5. ./0 ''12 , 12# , ( ) / DR, ITAT, MUMBAI 6. 045 6 / GUARD FILE / BY ORDER, / !'# (DY./ASSTT. REGISTRAR) #$ %, ( ) / ITAT, MUMBAI