Shri Gautam R. Desai, Valsad V. The Income Tax Officer, Ward-1, Valsad

ITA 3445/AHD/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 5907 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 4 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-05-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2005-2006
• Appeal Filed On: 23-12-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Reopening of assessment; Unexplained investment; Corroborative evidences
• Section: 131

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL , AHMEDABAD , SURAT CAMP BEFORE SHRI RAJPAL YADAV , JUDICIAL MEMBER AND SHRI AMARJIT SINGH , ACCOUNTANT MEMBER ./ ITA.NO. 3445 / AHD /201 4 / ASSTT. YEAR: 2005 - 2006 SHRI GAUTAM R.DESAI, A - 902, SUNFLOWER APPARTMENTS, TITHAL ROAD, VALSAD - 396001 PAN NO.ACCPD5495J VS . INCOME TAX OFFICER, WARD - I VALSAD (APPLICANT) (RESPONENT) ASSESSEE BY : SHRI RAJESH UPADHYAY , AR REVENUE BY : SHRI ASHISH POPHARE, SR.DR / DATE OF HEARING : 28 / 04 / 201 7 / DATE OF PRONOUNCEMENT: 15 / 05 /201 7 / O R D E R PER AMARJIT SINGH, ACCOUNTANT MEMBER : PRESENT APPEAL IS DIRECTED AT THE INSTANCE OF THE ASSESSEE AGAINST THE ORDER OF THE L D.CIT(A) - VALSAD DATED 14.11 .2014 PASSED FOR THE ASSTT.YEAR 2005 - 06 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL. (I) LD.CIT(A) VALSAD HAS ERRED IN LAW AND ON FACTS TO UPHOLD REOPENING OF ASSESSMENT MADE BY THE A.O;U/S.147 OF THE ACT. . (II) LD.CIT(A) VALSAD HAS ERRED IN LAW AND ON FACTS TO SUSTAIN ADDITION OF RS.1,24,000/ - ON ACCOUNT OF ALLEGED INVESTMENT MADE BY THE APPELLANT IN SHARES, DURING THE YEAR UNDER APPEAL. 2. IN THIS CASE RETURN O F INCOME DECLARING INCOME OF RS.1,40,212/ - WAS FILED ON 31/03/201 6 . THE CASE OF THE ASSESSEE WAS RE - OPENED U/S.147 OF THE ACT BY ISSUING NOTICE U/S.148 OF THE ACT ON 26/03/2012 ON THE BASIS OF ITA NO. 3445 /AHD/201 4 ASSTT. YEAR2005 - 06 2 INFORMATION RECEIVED FROM THE OFFICE OF DDIT, INVESTIGATION, VALSAD, THAT THE ASSESSE HAS MADE INVESTMENT IN THE NAME OF HIS WIFE SMT.KASHMIRA G. DESAI IN PURCHASE OF MUTUAL FUNDS OF RS.2,00,000/ - AND PURCHASE OF OFFICE SHOP WORTH RS,1,00,000/ - DURING THE FINANCIAL YEAR 2004 - 05. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE AS SESSING OFFICER HAS ASKED ASSESSEE TO FURNISH DEMAT STATEMENT . BUT THE ASSESSING OFFICER OBSERVED THAT ASSESSEE FAILED TO EXPLAIN THE SOURCE OF INVESTMENT , T HEREAFTER , THE A SSESSING OFFICER TREATED THE AMOUNT OF RS.3,00,000/ - AND RS.1,24,000/ - AS UNEXPLAINED INVESTMENT . 3. AGGRIEVED AGA INST THE DECISION OF ASSESSING OFFICER THE ASSESSEE FILED IN APPEAL BEFORE LD.CIT(A). THE LD.CIT(A) HAS PROVIDED PART RELIEF TO THE ASSESSEE BY DELETING THE AMOUNT OF RS.3,00,000/ - ON ACCOUNT OF UNEXPLAINED INVESTMENT MADE BY THE ASSESSEE IN THE NAME OF HIS WIFE AND SUS TAINED THE OTHER ADDITION OF RS.1,24,000/ - BY OBSERVING AS UNDER: ' I HAVE CAREFULLY CONSIDERED THE ASSESSMENT ORDER AS WELL AS THE SUBMISSIONS OF THE AR OF THE APPELLANT. IN REGARD TO THE ADDITION OF RS 1.24 LAKHS THE AR OF THE APPELLANT ALSO SUBMITTED EXPLANATION BUT DUE TO THE FACT THAT THIS GROUND OF APPEAL HAS ALREADY BEEN WITHDRAWN BY THE PREVIOUS AR OF THE APPELLANT WHICH WAS NOT CONTESTED BY THE PRESENT AR THEREFORE NO COGNIZENCE OF THIS EXPLANATION IS TAKEN. THE ADDITIONAL GROUND T AKEN BY THE AR OF THE APPELLANT DURING THE APPELLATE PROCEEDINGS REGARDING REOPENING OF THE ASSESSMENT IS ALLOWED TO BE TAKEN BEING A LEGAL GROUND. IN THIS REGARD THE AR OF THE APPELLANT MADE ELABORATE SUBMISSIONS ALONG WITH VARIOUS JUDICIAL DECISIONS THAT THE REOPENING OF THE ASSESSMENT IS NOT AS PER LAW. I HAVE GONE THROUGH THE ASSESSMENT ORDER AS WELL AS PERUSED THE SUBMISSION OF THE APPELLANT AS WELL AS THE JUDICIAL DECISIONS CITED AND I AM OF THE CONSIDERED VIEW THAT THERE WAS INFORMATION WITH THE ASSE SSING OFFICER IN REGARD TO THE UNEXPLAINED INVESTMENT MADE BY THE APPELLANT HENCE HE HAS VALIDLY REOPENED THE ASSESSMENT. THEREFORE THIS ADDITIONAL GROUND OF THE APPELLANT IS DISMISSED. IN REGARD TO THE ADDITION OF RS 3,00,000/ - MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED INVESTMENT MADE BY THE APPELLANT IN THE NAME OF HIS WIFE, I HAVE PERUSED THE ASSESSMENT ORDER AS WELL AS THE WRITTEN SUBMISSIONS MADE BY THE AR OF THE APPELL ANT. IN THE ASSESSMENT ORDER IT HAS BEEN STATED BY THE ASSESSING OFFICER ON BEING CONFRONTED THE APPELLANT ITA NO. 3445 /AHD/201 4 ASSTT. YEAR2005 - 06 3 EXPLAINED THAT THIS INVESTMENT HAS BEEN MADE BY THE WIFE OF THE APPELLANT AND HAS BEEN DULY REFLECTED IN THE RETURN OF INCOME. BUT THE ASSESSING OFFI CER DID NOT ACCEPT THIS PLEA OF THE APPELLANT NOR MADE ANY INQUIRY ON THIS ISSUE BUT MADE THE ADDITION MERELY BY STATING THAT THE APPELLANT HAS ADMITTED IN THE STATEMENT RECORDED U/S 131 OF THE ACT BY THE ADIT/DDIT(INV.). I HAVE VERIFIED THE APPELLATE RECO RD OF THE APPELLANT'S WIFE AND FIND THAT SIMILAR ADDITION HAS BEEN CONSIDERED IN HER CASE. IN VIEW OF THIS DOUBLE ADDITION CANNOT BE MADE. THEREFORE IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE GROUND OF APPEAL OF THE APPELLANT IS ALLOWED AND THE ADDITIO N MADE BY THE ASSESSING OFFICER IS DELETED. ' 4 . WE HAVE HEARD THE RIVAL CONTENTIONS PERUSED THE RECORDS PLACED BEFORE US. APROPOS TO GROUND NO.1 , WE OBSERVED THAT THE CASE OF THE ASSESSEE WAS REOPENED U/S.147 OF THE ACT ON THE BASIS OF INFORMATION RECEI VED FROM DDIT INVESTIGATION THAT ASSESSEE HAS MADE INVESTMENT IN THE NAME OF HIS WIFE SMT.KASHMIRA G. DESAI IN THE PURCHASE OF MUTUAL FUNDS OF RS.2,00,000/ - AND PURCHASE OF OFFICE SHOP WORTH RS.1,00,000/ - . IN THIS CONNECTION W E FIND THAT THERE WAS INFORMAT ION WITH THE ASSESSING OFFICER WITH REGARD TO THE UNEXPLAINED INVESTMENT MADE BY THE ASSESSEE BECAUSE OF WHICH THE CASE WAS REOPENED FOR ASSESSMENT. THEREFORE WE CONSIDERED THAT REOPENING OF ASSESSMENT WAS VALIDLY MADE T O VERIFY THE UNACCOUNTED INVESTMENT S ON THE BASIS OF INFORMATION RECEIVED BY THE ASSESSING OFFICER. T H EREFORE THIS GROUND OF APPEAL OF THE ASSESSEE IS DISMISSED. 5 . APROPOS TO GROUND NO.2 WE NOTICED THAT ADDITION OF RS.1,24,000/ - AS UNEXPLAINED INVESTMENT WAS MADE BY THE ASSESSING OFFICER PERTAINING TO INVESTMENT IN SHARE , THE SOURCE OF WHICH COULD NOT BE EXPLAINED BY THE ASSESSEE. WE FIND THAT LD.CIT(A) HAS SUSTAINED THIS ADDITION ON THE REASONING THAT THIS GROUND OF APPEAL OF THE ASSESEE WAS WITHDRAWN BY THE PREVIOUS AUTHORIZED REPRESENTATIVES OF THE ASSESSEE. IN THIS CONNECTION WE FIND THAT ASSESSEE H AS DEPLOYED ANOTHER AUTHORIZED REPRESENTATIVES BEFORE THE LD.CIT(A) DURING THE COURSE OF APPELLATE PROCEEDINGS AND HE HAS FURNISHED ITA NO. 3445 /AHD/201 4 ASSTT. YEAR2005 - 06 4 SUPPORTING EVIDENCES AND MATE RIAL REGARDING SOURCE OF INVESTMENT OF RS.1.24,000/ - . WE CONSIDERED THAT LD.CIT(A) HAS NOT DECIDED THIS ISSUE ON MERIT , T HEREFORE, IN THE INTEREST OF JUSTICE WE RESTORE THIS ISSUE TO THE FILE OF THE LD.CIT(A) TO DECIDE IT ON MERIT AFTER CONSIDERING THE S UPPORTING MATERIAL AND CONTENTION OF THE LD. COUNSEL. 6. IN THE RESULT THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 15 TH MAY , 2017 AT AHMEDABAD. SD/ - SD/ - ( RAJPAL YADAV ) JUDICIAL MEMBER ( AMARJIT SINGH ) ACCOUNTANT MEMBER TRUE COPY AHMEDABAD; DATED 15 / 05 /2017 MANISH / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A) 5. , / DR, ITAT, 6. / GUARD FILE . / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD