DEEPAK G. MENDA, MUMBAI V. ITO 23(20(2), MUMBAI

ITA 3603/MUM/2011

• Counselvise Citation: 360319914 RSA 2011
• Duration Of Justice: 3 year(s) 1 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-06-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 18-06-2014
• Assessment Year: 2004-2005
• Appeal Filed On: 05-05-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Gift; Opportunity of being heard; Onus to prove
• Section: 68

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI BEFORE S/SHRI B.R.BASKARAN (AM) AND SANJAY GARG, (JM) . . , , ./I.T.A. NO.3603/MUM/2011 ( / ASSESSMENT YEAR : 2004-05) MR.DEEPAK G MENDA C-1102, TRIDEV, BHAKTI MARG, MULUND (W), MUMBAI-400080. / VS. INCOME TAX OFFICER, WAD 23(2) (2), ROOM NO.406, BANDRA KURLA COMPLEX, BANDRA (E), MUMBAI-400051 ( !' / APPELLANT) .. ( #$!' / RESPONDENT) ! ./ % ./PAN/GIR NO. : AAJPM7914N !' & / APPELLANT BY : SHRI DEEPAK TRA L SHAWALA #$!' ' & /RESPONDENT BY : SHRI SANJEEV JAIN ( ) ' *+ / DATE OF HEARING : 18.6.2014 ,- ' *+ /DATE OF PRONOUNCEMENT : 25 .6.2014 . / O R D E R PER B.R.BASKARAN, ACCOUNTANT MEMBER: THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 17.02.2011 PASSED BY LD CIT(A)-33, MUMBAI AND IT RELATES TO TH E ASSESSMENT YEAR 2004-05. 2. THE ASSESSEE IS IN APPEAL BEFORE US IN RESPE CT OF THE FOLLOWING ISSUES:- (A) ASSESSMENT OF GIFT AMOUNT OF RS.1,60,000/- (B) ASSESSMENT OF LOAN RECEIPT OF RS.6,75,000/- A ND RS.1,45,000/- (C) ASSESSMENT OF CAR LOAN AMOUNT OF RS.1,84,819/ - (D) ASSESSMENT OF SUNDRY CREDITORS BALANCE OF RS. 9,31,896/- (E) ASSESSMENT OF RS.4,84,280/-, BEING THE DIFFER ENCE IN THE COST OF FLAT. (F) ASSESSMENT OF RS.1,11,180/- AS UNEXPLAINED SO URCE IN PURCHASE OF FLAT. 3. IN THIS CASE, THE ASSESSMENT WAS ORIGINALLY COMPLETED ON 19-12-2006. WHEN THE MATTER WAS TAKEN UP IN APPEAL TO THE ITAT, THE TRIB UNAL RESTORED ALL THE MATTERS TO THE FILE OF THE AO. THEN THE ASSESSING OFFICER PASSED THE IMPUGNED ASSESSMENT ORDER BY MAKING VARIOUS ADDITIONS. THE ASSESSEE CHALLENGED THE ADDITIONS BY FILING APPEAL BEFORE I.T.A. NO.3603/MUM/2011 2 LD CIT(A) AND THE APPEAL WAS ALLOWED PARTLY BY HIM. STILL AGGRIEVED, THE ASSESSEE HAS FILED THIS APPEAL BEFORE US. 4. THE FIRST ISSUE RELATES TO THE ASSESSMENT OF GIFT AMOUNT OF RS.1,60,000/- RECEIVED FROM H.T.GAJWANI. IN THE ORIGINAL ASSESSMENT PROCE EDINGS, THE AO ASSESSED THE ABOVE SAID GIFT AMOUNT FOR WANT OF PROOF OF SOURCE OF THE GIFT, THOUGH THE ASSESSEE HAD FURNISHED A SIMPLE LETTER CONFIRMING PAYMENT OF GIF T. DURING THE PRESENT PROCEEDINGS, THE ASSESSEE FURNISHED COPIES OF RETURN ACKNOWLEDGE MENT OF THE DONOR AND ALSO A DECLARATION OF GIFT OBTAINED FROM HIM. THE AO NOTI CED THAT THE DECLARATION WAS DATED 31.3.2004 AND THE EARLIER LETTER SPEAKED ABOUT THE GIFT GIVEN IN THE YEAR 2003-04. IN VIEW OF THE ABOVE SAID DISCREPANCY, THE AO AGAIN AS SESSED THE GIFT AMOUNT. THE LD CIT(A) ALSO CONFIRMED THE SAME ON THE REASONING THA T THE DECLARATION OF GIFT IS GIVEN ON A PLAIN PAPER; THE SOURCE OF GIFT NOT GIVEN AND THE DONOR IS NOT RELATED TO THE ASSESSEE BY BLOOD. 4.1 THE LD A.R POINTED OUT THAT THE PROVISION R ELATING TO THE NECESSITY OF RECEIVING GIFTS FROM SPECIFIED RELATIVES HAVE BEEN BROUGHT IN TO THE ACT ONLY FROM THE IMMEDIATELY SUCCEEDING YEAR. THE LD A.R FURTHER POINTED OUT TH AT ASSESSEE HAD RECEIVED LOANS FROM SHRI H.T. GAJWANI IN THE EARLIER YEARS AND THE DONO R HAS USED THE LOAN FUNDS TO GIVE GIFT TO THE ASSESSEE HEREIN. IN THIS CONNECTION, THE LD A.R CARRIED US THROUGH THE FINANCIAL STATEMENTS RELATING TO THE EARLIER YEARS. ACCORDIN GLY, THE LD A.R SUBMITTED THAT THE SOURCES FOR MAKING THE GIFT STANDS EXPLAINED. 4.2 ON THE CONTRARY, THE LD D.R SUBMITTED THAT THE DONOR DID NOT EXECUTE A PROPER GIFT DEED AND HE DID NOT EXPLAIN THE SOURCES FOR MA KING THE IMPUGNED GIFT. FURTHER THERE WAS NO BLOOD RELATIONSHIP BETWEEN THE DONOR A ND THE ASSESSEE. HE FURTHER SUBMITTED THAT THE ASSESSEE IS MAKING A NEW CLAIM B EFORE THE TRIBUNAL THAT THE SOURCE FOR MAKING GIFT IS THE LOAN AMOUNT RECEIVED IN THE EARLIER YEARS. 4.3 WE HAVE HEARD RIVAL CONTENTIONS ON THIS IS SUE. WE NOTICE THAT THE AO, IN THE ORIGINAL ASSESSMENT PROCEEDINGS, HAD ASSESSED THE G IFT ONLY FOR THE REASON THE DONOR DID NOT EXPLAIN THE SOURCE FOR MAKING THE GIFT. IN THE PRESENT PROCEEDINGS, THE AO ASSESSED THE GIFT AMOUNT AGAIN FOR THE REASON THAT THERE IS CONTRADICTION IN THE DATES OF MAKING GIFT. THE LD CIT(A) HAS IMPROVED THE REASONING BY STATING THAT THERE IS NO BLOOD RELATIONSHIP BETWEEN THE DONOR AND THE ASSESSEE. H OWEVER, THE CONTENTION OF THE LD A.R IS THAT THE FUNDS WERE NOT RECEIVED BY THE ASS ESSEE DURING THE YEAR UNDER CONSIDERATION, I.E., ACCORDING TO THE LD A.R, THE A SSESSEE HAD RECEIVED LOANS FROM THE I.T.A. NO.3603/MUM/2011 3 DONOR IN THE EARLIER YEARS AND THE SAID LOAN WAS CO NVERTED INTO THE IMPUGNED GIFT. IF THAT IS SO, THE SOURCES FOR MAKING GIFT STANDS EXPL AINED. AS SUBMITTED BY LD A.R, THE NECESSITY OF RECEIVING GIFTS FROM SPECIFIED RELATIV ES HAVE BEEN INTRODUCED INTO THE ACT ONLY FROM THE SUCCEEDING ASSESSMENT YEAR. HENCE, W E DO NOT FIND ANY REASON TO ASSESS THE IMPUGNED GIFT RECEIPT DURING THE YEAR UNDER CON SIDERATION. HOWEVER, AS SUBMITTED BY LD D.R, THE CLAIM OF RECEIPT OF LOANS IN THE EAR LIER YEARS AND CONVERSION OF THE SAME AMOUNTS INTO GIFT REQUIRES VERIFICATION. HENCE, FOR THE LIMITED PURPOSE OF VERIFYING THE SAID CLAIM, WE ARE SETTING ASIDE THIS MATTER TO THE FILE OF THE AO WITH THE DIRECTION TO VERIFY THE SAID CLAIM AND AFTER SATISFYING HIMSELF IN THAT REGARD DELETE THE ADDITION. 5. THE NEXT ISSUE RELATES TO THE ASSESSMENT OF LOAN AMOUNT OF RS.6,70,000/- RECEIVED FROM SHRI VIKARAM D MENDA. THE AO NOTICED THAT THE LENDER WAS SON OF THE ASSESSEE AND HE WAS 29 YEARS OLD. IT WAS STATED THAT THE LE NDER WAS WORKING WITH A C.A BY GETTING RS.500/- P.M AND WAS RECEIVING A SUM OF RS. 45,000/- P.A. AS TUITION FEES. HOWEVER, THE LENDER COULD NOT GIVE NAME AND ADDRESS ES OF THE STUDENTS FROM WHOM THE FEES WERE RECEIVED. HE ALSO STATED BEFORE THE AO T HAT THE FUNDS WERE INVESTED IN MUTUAL FUNDS AND THE PROCEEDS RECEIVED ON LIQUIDATI ON OF THE SAME WAS USED TO GIVE THE LOAN TO THE ASSESSEE. THE AO TOOK THE VIEW THAT TH E LENDER WAS JUST 23 YEARS OLD DURING THE RELEVANT YEAR AND THE INCOME DECLARED BY HIM WA S NOT COMMENSURATE WITH THE AMOUNT OF LOAN GIVEN TO THE ASSESSEE. HENCE, THE A O ASSESSED THE LOAN AMOUNT OF RS.6,70,000/- AS INCOME OF THE ASSESSEE U/S 68 OF T HE ACT. THE LD CIT(A) ALSO CONFIRMED THE SAID ASSESSMENT. 5.1 WE HAVE HEARD RIVAL CONTENTIONS ON THIS ISS UE. THE LD A.R SUBMITTED THAT THE ASSESSEE HAS RECEIVED THE IMPUGNED LOAN AMOUNT BY W AY OF CHEQUE AND HENCE THE SOURCE OF THE LOAN STANDS PROVED. HOWEVER, THE AO HAS ASKED THE ASSESSEE TO PROVE THE SOURCE OF SOURCES, WHICH IS NOT JUSTIFIED. IN SUPPORT OF THIS PROPOSITION, THE AO PLACED RELIANCE ON THE FOLLOWING CASE LAW:- (A) NEMI CHAND KOTHARI VS. CIT (264 ITR 254) (GAU) (B) 256 ITR 360 (GUJ) THE LD A.R SUBMITTED THAT THE SLP FILED AGAINST THE DECISION RENDERED BY THE HONBLE GUJARAT HIGH COURT IN THE ABOVE SAID CASE HAS SINCE BEEN DISMISSED BY THE HONBLE SUPREME COURT AND THE SAME IS REPORTED IN 254 ITR ( ST.) 275. ON MERITS, THE LD A.R SUBMITTED THAT THE LENDER IS ASSESSED TO INCOME TAX AND HE HAS BEEN FILING INCOME TAX RETURNS FOR THE PAST SEVERAL YEARS. THE LENDER HAD INVESTED HIS SAVINGS IN MUTUAL FUND SCHEMES AND THE AMOUNT REALISED ON LIQUIDATION OF T HE UNITS HAVE BEEN USED TO GIVE THE I.T.A. NO.3603/MUM/2011 4 LOAN TO THE ASSESSEE. ON THE CONTRARY, THE LD D.R PLACED STRONG RELIANCE ON THE DECISION RENDERED BY LD CIT(A) ON THIS ISSUE. DURING THE CO URSE OF HEARING, THE LD A.R CARRIED US THROUGH THE PAPER BOOK TO SUBSTANTIATE HIS CONTENTI ONS. 5.2 THE LOAN TRANSACTION RELATING TO SHRI DEEPA K G MENDA APPEARS AS UNDER:- 01.04.2003 OPENING BALANCE OF LOAN CREDIT 2,83, 000 03.11.2003 AMOUNT REPAID BY THE ASSESSEE 4,00,000 ------------ (1,17,000) 09.11.2003 RECEIVED CHEQUE 3,50,000 10.12.2003 RECEIVED CHEQUE 3,20,000 ------------------ 31.3.2004 CLOSING BALANCE 5,53,000 ========= IT CAN BE SEEN THAT THE ASSESSEE HAS REPAID A SUM O F RS.4.00 LAKHS TO SHRI VIKRAM G MENDA ON 03.11.2003. ON A PERUSAL OF THE BANK ACCO UNT OF SHRI VIKRAM G MENDA, WE NOTICE THAT THE SAID CHEQUE WAS REALISED ON 06.11.2 003 AND HE HAS USED THE PROCEEDS THEREOF TO GIVE A SUM OF RS.3,50,000/- TO THE ASSES SEE ON 09.11.2003. HENCE, THE SOURCE OF THE SAID AMOUNT STANDS EXPLAINED. IN RES PECT OF THE AMOUNT OF RS.3,20,000/-, WE NOTICE THAT THE LENDER SHRI DEEPAK G MENDA HAS E NCASHED THE MUTUAL FUND UNITS AND REALISED A SUM OF RS.3,19,141/- AND THE SAME WAS CR EDITED INTO HIS BANK ACCOUNT ON 25- 08-2003. ON THE SAME DAY THE LENDER HAS USED THE A BOVE SAID AMOUNT TO MAKE A DEPOSIT OF RS.3,20,000/- INTO FIXED DEPOSIT. THE S AID FIXED DEPOSIT WAS FINALLY CLOSED ON 12.11.2003 AND THE MATURITY PROCEEDS REALISED THERE FROM AMOUNTING TO RS.3,23,047/- WAS CREDITED TO HIS BANK ACCOUNT. SHRI VIKRAM G ME NDA HAS USED THE SAID PROCEEDS TO ADVANCE A SUM OF RS.3,20,000/- TO THE ASSESSEE. TH US THE SOURCES FOR GIVING THE LOAN OF RS.3,20,000/- ALSO STANDS EXPLAINED. WE ALSO NOTIC E THAT SHRI VIKRAM D MENDA IS ALSO ASSESSED TO INCOME TAX AND HE HAS BEEN FILING RETUR N OF INCOME FOR THE PAST SEVERAL YEARS. UNDER THESE SET OF FACTS, WE ARE OF THE VIE W THAT THERE IS NO REASON TO SUSPECT THE CREDIT WORTHINESS OF SHRI VIKRAM D MEHTA. ACCO RDINGLY, WE ARE UNABLE TO AGREE WITH THE CONCLUSIONS REACHED BY LD CIT(A). ACCORDINGLY, WE SET ASIDE THE ORDER OF LD CIT(A) AND DIRECT THE AO TO DELETE THE ASSESSMENT OF RS.6, 70,000/-. 6. THE NEXT ISSUE RELATES TO THE ASSESSMENT OF RS.1,45,000/- RECEIVED FROM DILIP D MENDA. A PERUSAL OF THE DOCUMENTS FILED BY THE ASS ESSEE SHOWS THAT THE ASSESSEE HAS RECEIVED A SUM OF RS.50,000/- ON 16.7.2003 AND RS.9 5,000/- ON 17.12.2003 AND BOTH THE AMOUNTS HAVE BEEN RECEIVED BY WAY OF CHEQUES. A PERUSAL OF BANK ACCOUNT OF SHRI DILIP D MENDA SHOWS THAT THE LENDER HAS DEPOSITED C ASH INTO HIS BANK ACCOUNT BEFORE ISSUING CHEQUE TO THE ASSESSEE. FURTHER, HE WAS J UST 19 YEARS OLD AT THAT POINT OF TIME I.T.A. NO.3603/MUM/2011 5 AND HE HAS CLAIMED THAT HE HAD RECEIVED INCOME BY G IVING PRIVATE TUITIONS. IT APPEARS THAT HE HAS FILED HIS RETURN OF INCOME FOR THE FIRS T TIME IN ASSESSMENT YEAR 2004-05 AND THE INCOME DECLARED BY HIM WAS RS.47,159/- ONLY, WH EREAS THE LOAN ADVANCED TO THE ASSESSEE DURING THE YEAR WAS RS.1,45,000/-. IT IS PERTINENT TO NOTE THAT HE HAD ALREADY GIVEN A LOAN OF RS.83,000/- IN THE EARLIER YEARS TO THE ASSESSEE. THE LD A.R PLACED STRONG RELIANCE ON THE DECISIONS RENDERED BY HONBL E GAUHATI HIGH COURT AND HONBLE GUJARAT HIGH COURT REFERRED ABOVE TO CONTEND THAT T HE ASSESSEES RESPONSIBILITY STANDS DISCHARGED WHEN HE RECEIVES THE LOAN BY WAY OF CHEQ UE. HOWEVER, THE SETTLED PROPOSITION IS THAT THE PRIMARY ONUS TO PROVE THE C ASH CREDITS IS PLACED UPON THE ASSESSEE AND IN ORDER TO DISCHARGE THE SAID PRIMARY ONUS, THE ASSESSEE HAS TO PROVE THREE MAIN INGREDIENTS, VIZ., THE IDENTITY OF THE C REDITOR, THE GENUINENESS OF TRANSACTIONS AND THE CREDIT WORTHINESS OF THE CREDITOR. IN THE INSTANT CASE, THE IDENTITY OF THE CREDITOR STANDS PROVED SINCE HE HAPPENS TO THE SON OF THE AS SESSEE AND THE DETAILS OF HIS NAME, ADDRESS, BANK DETAILS, CONFIRMATION OBTAINED FROM H IM ETC. HAVE BEEN FURNISHED. THE GENUINENESS OF THE TRANSACTION IS ALSO STANDS PROVE D SINCE THE FUNDS WERE RECEIVED THROUGH BANKING CHANNELS. WITH REGARD TO THE CREDI T WORTHINESS, WE NOTICE THAT THE ASSESSEE HAS FURNISHED ONLY COPIES OF INCOME TAX RE TURN FILED BY THE CREDITOR. WE HAVE ALREADY DISCUSSED THAT THE LENDER WAS ONLY 19 YEARS OLD AND THE POSSIBILITY OF EARNING TUITION INCOME IS REMOTE. HENCE, WE ARE OF THE VIE W THAT THE ASSESSEE HAS FAILED TO PROVE THE CREDIT WORTHINESS OF THIS CREDITOR. HENC E, WE ARE UNABLE TO ACCEPT THE CONTENTIONS OF THE ASSESSEE THAT THE RECEIPT OF MON EY BY WAY OF CHEQUE PROVES THE CREDIT WORTHINESS OF THE CREDITOR. CONSIDERING HIS AGE, THE LEVEL OF INCOME DECLARED IN HIS RETURN OF INCOME, WE ARE INCLINED TO ACCEPT THE VIEW EXPRESSED BY LD CIT(A) THAT THE ASSESSEE HAS FAILED TO PROVE CREDIT WORTHINESS OF T HIS CREDITOR. ACCORDINGLY, WE CONFIRM HIS ORDER ON THIS ISSUE. 7. THE NEXT ISSUE RELATES TO THE ADDITION OF CA R LOAN OF RS.1,84,819/- ON THE GROUND THAT THE ASSESSEE HAS FAILED TO FURNISH NECESSARY D ETAILS. WE HEARD RIVAL CONTENTIONS ON THIS ISSUE. THE LD A.R SUBMITTED THAT THE ASSESSEE HAS TAKEN CAR LOAN OF RS.2.00 LAKHS FROM ICICI BANK AND REPAID TWO INSTALMENTS DURING T HE YEAR UNDER CONSIDERATION. HENCE THERE WAS A CLOSING BALANCE OF RS.1,84,811/- AS AT 31.3.2004. IN THE PAPER BOOK, THE ASSESSEE HAS FURNISHED A COPY OF ICICI BANK STATEME NT. HOWEVER, AS NOTICED EARLIER, THE AO HAS MADE THE ADDITION ONLY ON THE REASONING THAT THE ASSESSEE HAS FAILED TO FURNISH NECESSARY DETAILS. SINCE THE RELEVANT DETA ILS HAVE BEEN FURNISHED IN THE PAPER BOOK, WE ARE OF THE VIEW THAT THE SAME REQUIRES EXA MINATION BY THE AO. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD CIT(A) ON THIS ISSUE A ND RESTORE THE SAME TO THE FILE OF THE I.T.A. NO.3603/MUM/2011 6 AO WITH THE DIRECTION TO EXAMINE THE ISSUE AFRESH B Y CONSIDERING THE DETAILS FURNISHED BY THE ASSESSEE AND TAKE APPROPRIATE DECISION IN ACCOR DANCE WITH THE LAW. 8. THE NEXT ISSUE RELATES TO THE ADDITION OF SU NDRY CREDITORS BALANCE OF RS.9,31,896/-. WE NOTICE FROM THE ASSESSMENT ORDER THAT THE AO HAS CONDUCTED ENQUIRIES WITH THE SUNDRY CREDITORS, ONLY FOR THE PURPOSES OF VERIFYIN G THE GENUINENESS OF PURCHASES. IN PAGE NO.85 OF THE PAPER BOOK, THE ASSESSEE HAS FURN ISHED THE BREAK-UP DETAILS OF THE SUNDRY CREDITORS BALANCE OF RS.9,31,896/-. ON A PE RUSAL OF THE SAME, WE NOTICE THAT THE ABOVE SAID AMOUNT RELATES TO 24 CREDITORS. HOWEVER , THE AO HAS CONDUCTED ENQUIRIES WITH THE FOLLOWING FIVE CREDITORS ONLY:- AMBIKA APPAREL 99,457.00 AVNI ENTERPRISES 5,309.00 BUL BUL GARMENTS 1,20,705.00 GAYATRI TEXTILES 1,21,338.00 MAHAVIR TEXTIELS 2,66,801.50 THE LD A.R CONTENDED THAT THE AO WAS NOT JUSTIFIED IN DRAWING ADVERSE INFERENCES IN RESPECT OF THE REMAINING CREDITORS BY FOLLOWING THE RESULT OF ENQUIRIES CONDUCTED WITH JUST FIVE CREDITORS. WE FIND MERIT IN THE SAID CON TENTION. IN OUR VIEW, THE AO WAS NOT CORRECT MAKING ADDITION OF THE REMAINING CREDITORS NUMBERING 19 WITHOUT BRINGING ANY MATERIAL ON RECORD TO JUSTIFY THE ADDITION. HENCE THE LD CIT(A) WAS ALSO NOT JUSTIFIED IN CONFIRMING ADDITION RELATING TO THE REMAINING 19 CR EDITORS. 8.1 THE ASSESSEE HAS FURNISHED LEDGER COPIES OF THE ABOVE SAID FIVE CREDITORS AT PAGES 87-92. A PERUSAL OF THE SAME SHOWS THAT THE ASSESS EE BROUGHT FORWARD THE OUTSTANDING BALANCE FROM THE IMMEDIATELY PRECEDING YEAR IN RESP ECT OF THE FOLLOWING CREDITORS, MEANING THEREBY THE ASSESSEE DID NOT MAKE ANY FRESH PURCHASES FROM THEM DURING THE YEAR UNDER CONSIDERATION:- AMBIKA APPAREL 99,457.00 MAHAVIR TEXTILES 2,66,801.50 IN THE CASE OF BUL BUL GARMENTS, WE NOTICE THAT THE SAID PARTY HAS PERFORMED SOME LABOUR WORK FOR THE ASSESSEE AND THE ASSESSEE HAS B EEN REGULARLY PAYING MONEY TOWARDS LABOUR CHARGES TO THE SAID PARTY. HENCE, I N THIS CASE ALSO THE ASSESSEE DID NOT PURCHASE ANY MATERIAL FROM IT. IN CASE OF AVNI EN TERPRISES, THE ASSESSEE HAS MADE FOUR PURCHASES DURING THE YEAR AND THE CLOSING BALANCE O F RS.5,309/- REPRESENTS LAST TWO I.T.A. NO.3603/MUM/2011 7 PURCHASES. WHEN THE AO IS ACCEPTING THE FIRST TWO PURCHASES, IN OUR VIEW, THERE IS NO REASON TO SUSPECT THE REMAINING TWO PURCHASES. IN RESPECT OF M/S GAYATRI TEXTILES, THE ASSESSEE DID NOT FURNISH THE LEDGER ACCOUNT COPY AN D HENCE WE ARE UNABLE TO ANALYSE THE SAME. THE LD A.R, HOWEVER, SUBMITTED THAT THE AO HAS MADE THE IMPUGNED ADDITION WITHOUT AFFORDING NECESSARY OPPORTUNITY TO THE ASSESSEE. WE FIND FORCE IN RESPECT OF THE SAME. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD CIT(A) AND DIRECT THE AO TO AFFORD OPPORTUNITY TO THE ASSESSEE IN RESPECT OF THE ADDITION RELATING TO M/S GAYATRI TEXTILES. WITH REGARD TO THE REMAINING AMO UNT RELATING TO 23 PARTIES, THE AO IS DIRECTED TO DELETE THE ADDITION. IN RESPECT OF M/S GAYATRI TEXTILES, THE AO MAY DECIDE THE ISSUE IN ACCORDANCE WITH THE LAW AFTER AFFORDIN G NECESSARY OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 9. THE NEXT ISSUE RELATES TO THE ADDITION OF RS .4,84,280/- RELATING TO DIFFERENCE IN THE VALUE OF TRIDEV FLAT. IN THIS REGARD, THE LD A.R I NVITED OUR ATTENTION TO PAGE 93 OF THE PAPER BOOK, WHEREIN THE ASSESSEE HAS RECONCILED THE COST OF INVESTMENT MADE IN TRIDEV FLATS WITH THE SOURCES. ACCORDING TO LD A.R, THE A SSESSEES WIFE SMT KIRAN D MEHTA HAS ALSO CONTRIBUTED A SUM OF RS.8,83,922/- AND THE AGG REGATE CONTRIBUTION MADE BY THE ASSESSEE AND HIS WIFE EXPLAINS THE SOURCES OF INVES TMENT RELATING TO TRIDEV FLATS. ON A PERUSAL OF THE ORDER OF TAX AUTHORITIES, WE NOTICE THAT THE ADDITION HAS BEEN MADE ONLY FOR WANT OF RECONCILIATION OF THE INVESTMENT COST W ITH SOURCES THEREOF. THE EXPLANATIONS AND DETAILS FURNISHED BY THE ASSESSEE, IN OUR VIEW, EXPLAINS THE SOURCES. HOWEVER, THEY REQUIRE EXAMINATION AT THE END OF THE AO. ACCORDIN GLY, WE SET ASIDE THE ORDER OF LD CIT(A) ON THIS ISSUE AND DIRECT THE AO TO EXAMINE T HE ISSUE AFRESH BY CONSIDERING THE EXPLANATIONS AND RECONCILIATION STATEMENT FURNISHED BY THE ASSESSEE AND TAKE APPROPRIATE DECISION IN ACCORDANCE WITH THE LAW. 10. THE NEXT ISSUE RELATES TO THE ADDITION OF RS .1,11,180/- MADE TOWARDS UNEXPLAINED SOURCE FOR PURCHASE OF TRIDEV FLAT. THE LD A.R SUB MITTED THAT THE ASSESSEE COULD NOT DECIPHER THE DETAILS RELATING TO THE ADDITION OF RS .1,11,180/- MADE BY THE AO. HE SUBMITTED THAT THE RECONCILIATION STATEMENT FURNISH ED AT PAGE 93 OF THE PAPER SUFFICIENTLY EXPLAINS THE SOURCES FOR THE INVESTMENT MADE IN TRI DEV FLAT. SINCE WE HAVE ALREADY SET ASIDE THE ISSUE RELATING TO TRIDEV FLATS TO THE FIL E OF THE AO, WE SET ASIDE THE ORDER OF LD CIT(A) ON THIS ISSUE AND RESTORE THE SAME TO FILE O F THE ASSESSING OFFICER WITH THE DIRECTION TO EXAMINE THIS ADDITION ALSO AFRESH. I.T.A. NO.3603/MUM/2011 8 11. NEEDLESS TO MENTION, THE ASSESSEE SHOULD BE GIVEN NECESSARY OPPORTUNITY OF BEING HEARD. 12. IN THE RESULT, THE APPEAL FILED BY THE ASSES SEE IS TREATED AS PARTLY ALLOWED FOR STATISTICAL PURPOSES. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT O N 25TH JUNE, 2014. ,- ( /0 1 2 25TH JUNE, 2014 - ' ) 3 SD SD ( /SANJAY GARG) ( . . / B.R. BASKARAN ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER / ( ) MUMBAI: 25TH JUNE,2014. . . ./ SRL , SR. PS ! '#$%& '&($ / COPY OF THE ORDER FORWARDED TO : 1. !' / THE APPELLANT 2. #$!' / THE RESPONDENT. 3. ( 5* ( ) / THE CIT(A)- CONCERNED 4. ( 5* / CIT CONCERNED 5. 6 #* 7 , + 7 , / ( ) / DR, ITAT, MUMBAI CONCERNED 6. 8) / GUARD FILE. . ( / BY ORDER, TRUE COPY 9 (ASSTT. REGISTRAR) + 7 , / ( ) /ITAT, MUMBAI