PRAFUL PANINDARE, NAVI MUMBAI V. ITO 35(2)(5), MUMBAI

ITA 3419/MUM/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 7775 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-03-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2009-2010
• Appeal Filed On: 04-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M C OM NINGSHEN
• Assessee Lawyers: M K PATEL
• Keywords: Unexplained cash credit; Opportunity of being heard; Principle of natural justice
• Section: 142(1); 133(6); 147; 148; 144

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL H BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH , JM AND SHRI RAJESH KUMAR, AM ./ I.T.A. NO 3419 / MUM/ 201 5 ( / ASSESSMENT YEAR : 20 0 9 - 10 ) PRAFUL PAN INDARE, 501, CLASSIC RESIDENCY, SECTOR 42A, SEAWOODS, NERUL, NAVI MUMBAI - 400601 / VS. INCOME TAX OFFICER - 3 5( 2 )( 5 ), ROOM NO.306, C - 1 2 , 3 RD FLOOR, PRATYAKSHAKAR BHAVAN, BANDRA - KURLA COMPLEX, BANDRA (E), MUMBAI - 400051. / APPLICA NT BY : MS. M K PATEL /RESPONDENT BY : SHRI M C OM NINGSHEN / DATE OF HEARING : 1 6.3. 201 7 / DATE OF PRONOUNCEMENT : 20. 3 .2017 / O R D E R PER RAJESH KUMAR, A. M: THIS IS AN APPEAL FILED BY THE ASSESSEE AND IT IS DIRECTED AGAINST THE ORDER OF THE LD.CIT(A), MUMBAI, DATED 20.3.2015 FOR THE ASSESSMENT YEAR 20 0 9 - 10 . 2. THE VARIOUS GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE AS UNDER : 1) A) THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL) HAS ERRED IN CONFIRMING THE ORDER PASSED BY THE LEARNED ASSESSING OFFICER WITHOUT CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE. THE SAME BE DELETED. 2 ITA NO.3419 / MUM/ 201 5 B) THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ALSO FAILED TO CONSIDER THE VARIOUS SUBMI SSIONS FILED BY THE ASSESSEE BEFORE THE LEARNED ASSESSING OFFICER AS WELL AS CIT(A) IN REGARD TO EXPLANATION THAT THE TRANSACTION BETWEEN THE TWO COMPANIES ARE IN THE NORMAL COURSE OF BUSINESS. THE SAME BE CONSIDERED AND THE ADDITION BE DELETED. C) THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FAILED TO CONSIDER THE CONFIRMATIONS, BANK STATEMENTS AS WELL AS INCOME TAX RETURNS FILED BY THE RESPECTIVE PARTIES. D) THE LEARNED ASSESSING OFFICER DURING THE REMAND PROCEEDING HAD GIVEN NO OPPORTUNITY O F P ERSONAL HEARING TO THE ASSESSEE AND PASSED THE REMAND RE POR T BASED ON DOCUMENTS FILE BY THE ASSESSEE BEFORE THE LD.CIT(A). T HE LEARNED ASSESSING OFFICER HAD ALSO NOT CONFIRMED THE SAID TRANSACTIONS BY ISSUING NOTICE U/S 133(6 ) OF THE INCOME TAX ACT, 19 61. HENCE THE SA ID ORDER PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (ANNEAL) IS BAD IN LAW AND NEEDS TO BE QUASHED. 3. THE ISSUE RAISED IN GROUND NO .(D) IS QUA NOT ALLOWING ANY OPPORTUNITY OF HEARING TO THE ASSESSEE DURING THE REMAND PROCEEDINGS BY THE AO WHO FINALIZED THE REMAND REPORT ON THE BASIS OF DOCUMENTS AS FILED BY THE ASSESSEE BEFORE THE LD. CIT(A). THE AO HAS ALSO NOT CONFIRMED THE TRANSACTIONS BY ISSUING NOTICE UNDER SECTION 133(6) OF THE INCOME TAX ACT, 1961 AND THEREFORE THE ORD ER OF THE FIRST APPELLATE AUTHORITY WAS BAD IN LAW AND REQUESTED THE BENCH TO QUASH THE SAME. 4. THE FACTS OF THE CASE ARE THAT THE ASSESSEE FILED RETURN OF INCOME ON 15.10.2009 DECLARING TOTAL INCOME OF THE ASSESSEE AT RS.3,28,115/ - . THE CASE OF THE AS SESSEE WAS REOPENED UNDER SECTION 147 ON THE BASIS OF INFORMATION RECEIVED REGARDING CASH DEPOSIT OF RS.42,34,000 / - IN THE BANK ACCOUNT OF THE ASSESSEE. ACCORDINGLY, A NOTICE WAS ISSUED TO THE ASSESSEE 3 ITA NO.3419 / MUM/ 201 5 U/S 148 OF THE ACT. IN RESPONSE TO THE NOTICE ISSUED U/S 148, THE ASSESSEE DID NOT FILE ANY RETURN. THEREAFTER, STATUTORY PROCEEDINGS UNDER SECTION 142(1) WERE INITIATED AGAINST THE ASSESSEE. IN RESPONSE TO THE NOTICE U/S 142(1), THE ASSESSEE ATTENDED THE PROCEEDINGS FROM TIME TO TIME BEFORE THE AO AND FI LED CERTAIN DETAILS WITH RESPECT TO THE INCOME FROM OTHER SOURCES AND UNEXPLAINED CASH CREDITS AMOUNTING TO RS.42,34,000/ - . THE AO , AFTER CONSIDERING THE DETAILS SUBMITTED BY THE ASSESSEE WITH REGARDS TO THE INCOME FROM OTHER SOURCES AND UNEXPLAINED CA SH CREDIT WAS NOT CONVINCED WITH THE ASSESSEE S REPLY. T HE ATTITUDE OF THE ASSESSEE BEFORE THE AO WAS TO DELAY THE PROCEEDINGS BY NOT FILING THE DETAILS CALLED FOR AND HENCE MADE ASSESSMENT U/S 14 4 READ WITH SECTION 147 OF THE ACT VIDE ORDER DATED 30 .3.2013 BY ASSESSING THE TOTAL INCOME OF THE ASSESSEE AT RS.51,42 , 750/ - BY MAKING ADDITIONS IN RESPECT OF SALARY, INCOME FROM OTHER SOURCES AND UNEXPLAINED CASH CREDITS . AGGRIEVED BY THE ORDER OF T HE AO, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE FIRST A PPELLATE AUTHORITY . 5 . IN THE APPELLATE PROCEEDINGS, THE LD.CIT(A) CALLED FOR THE REMAND REPORT FROM THE AO BY SENDING VARIOUS DOCUMENTS TO THE AO. THE LD.CIT(A) ON RECEIPT OF REMAND REPORT CONFIRMED THE ACTION OF THE AO. AGGRIEVED BY THE ORDER OF L D. CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 4 ITA NO.3419 / MUM/ 201 5 6 . BEFORE US, THE LD.AR VEHEMENTLY SUBMITTED BEFORE US THAT DURING THE COURSE OF APPELLATE PROCEEDINGS, THE LD.CIT(A) CALLED FOR THE REMAND REPORT FROM THE AO BY SENDING VARIOUS DOCUMENTS TO T HE AO. THE AO, THEREAFTER PREPARED THE REMAND REPORT ON THE BASIS OF DOCUMENTS RECEIVED FROM THE LD.CIT(A) WITHOUT GIVING ANY OPPORTUNITY OF BEING HEARD C AUSING GRAVE MISCARRIAGE OF JUSTICE BY VIOLATING THE PRINCIPLE OF NATURAL JUSTICE . THE LD. AR PRAYED BE FORE THE BENCH THAT THE MATTER MAY BE SET ASIDE TO THE FILE OF AO WITH A DIRECTION TO ALLOW AN OPPORTUNITY TO THE ASSESSEE TO REPRESENT HIS CASE BEFORE THE AO AND DECIDE THE CASE DENOVO AS PER LAW . 7 . THE LD. DR DID NOT OBJECT TO THE PLEA PUTFORTH BY THE LD.AR. 8 . WE HAVE HEARD THE ARGUMENTS OF THE PARTIES AND PERUSED THE MATERIAL PLACED BEFORE US INCLUDING THE ORDERS OF AUTHORITIES BELOW. WE FIND THAT THE AO HAS PREPARED REMAND REPORT WITHOUT ALLOWING OPPORTUNITY TO THE ASSESSEE WHICH WAS RELIED UPON BY CIT(A) WHILE DECID ING THE APPEAL OF THE ASSESSEE. TH E AO SHOULD HAVE GIVEN OPPORTUNITY TO THE ASSESSEE DURING THE REMAND PROCEEDINGS WHICH WAS NOT GIVEN. IN OUR OPINION, THE ENDS OF JUSTICE WOULD BE MET IF THE ISSUE IS RESTORED BACK TO THE FILE OF A O TO DECIDE THE ISSUE AFRESH AS PER FACTS ON RECORD AND LAW AFTER AFFORDING FAIR AND REASONABLE OPPORTUNITY BEING H E ARD TO THE ASSESSEE. WE ALSO DIRECT THE ASSESSEE TO CO - OPERATE IN THE SET ASIDE PROCEEDING BEFORE THE AO. 5 ITA NO.3419 / MUM/ 201 5 9 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED IN THE OPEN COURT ON 20 TH MARCH , 2017 S D SD ( MAHAVIR SINGH ) (RAJESH KUMAR) / JUDICI AL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 20. 3 .2017 SRL,SR.PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD F ILE / BY ORDER, T RUE COPY / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI