ITO 20(3)(4), MUMBAI V. VIVEK V. SHARMA, MUMBAI

ITA 3674/MUM/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 83633 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2009-2010
• Appeal Filed On: 09-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUNIL KUMAR SINGH
• Keywords: Unexplained cash credit; Additional evidence; Question of law
• Section: 68; 144; 143(3)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL F BENCH, MUMBAI BEFORE HONBLE S/SHRI D. MANMOHAN , VICE-PRESIDENT AND B.R.BASKARAN (AM) , . , . . , ! ./I.T.A. NO.3674/MUM/2013 ( '#$ % / ASSESSMENT YEAR : 2009-10) INCOME TAX OFFICER - 20(3)(4), 5 TH FLOOR, PIRAMAL CHAMBERS, LALBAUG, MUMBAI-400012 / VS. VIVEK V SHARMA , C-18, UTTARAYAN CHS, MAHAKALI CAVES ROAD, ANDHERI(E), MUMBAI. ( !&' / APPELLANT) .. ( ()&' / RESPONDENT) & ./ *+ ./PAN/GIR NO. : BEUPS9312C !&' , / APPELLANT BY : SHRI SUNIL KUMAR SINGH ()&' - , /RESPONDENT BY : NONE . / - 01 / DATE OF HEARING : 18.8.2014 2 %$ - 01 /DATE OF PRONOUNCEMENT : 28.8.2014 / O R D E R PER B.R.BASKARAN, ACCOUNTANT MEMBER: THE APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER DATED 05-02- 2013 PASSED BY LD CIT(A)-13, MUMBAI AND IT RELATES TO THE ASSESSMENT YEAR 2009-10. THE REVENUE IS AGGRIEVED BY THE DECISION OF LD CIT(A) IN DELETING THE ADDITION OF RS.27,68,900/- MADE BY THE AO U/S 68 OF THE ACT. NONE APPEARED ON BEHALF OF THE ASSESSEE AND HENCE WE PROCEED TO DISP OSE OF THIS APPEAL EX-PARTE, WITHOUT THE PRESENCE OF THE ASSESSEE. 2. THE FACTS RELATING THERETO ARE STATE IN BRIEF. DURING THE COURSE OF ASSESSMENT PROCEEDING, THE AO NOTICED THAT THE ASSE SSEE HAS DEPOSITED CASH AGGREGATING TO RS.29,18,900/- IN HIS BANK ACCOUNT M AINTAINED WITH PUNJAB ITA 3674/MUM/2013 2 MAHARASHTRA CO-OP BANK LTD. SINCE NO EXPLANATION W AS FORTHCOMING FROM THE ASSESSEE, THE AO ASSESSED THE SAME AS THE INCOME OF THE ASSESSEE U/S 68 OF THE ACT. IT IS TO BE MENTIONED HERE THAT THE AO HAS CO MPLETED THE ASSESSMENT TO THE BEST OF HIS JUDGMENT U/S 144 OF THE ACT, SINCE THE ASSESSEE DID NOT APPEAR BEFORE HIM AT ALL DURING THE COURSE OF ASSESSMENT P ROCEEDING. HOWEVER, THE AO HAS WRONGLY MENTIONED IN THE ASSESSMENT ORDER THAT THE ASSESSMENT HAS BEEN COMPLETED U/S 143(3) OF THE ACT. 3. BEFORE LD CIT(A), THE ASSESSEE SUBMITTED AL L THE DETAILS PERTAINING TO THE BANK DEPOSITS. HENCE, THE LD CIT(A) CALLED FOR A R EMAND REPORT FROM THE ASSESSING OFFICER. IN THE REMAND REPORT, THE AO RE PORTED THAT THE CASH DEPOSITS MADE INTO THE BANK ACCOUNT ARE DULY REFLECTED IN TH E CASH BOOK / BOOKS OF ACCOUNT AND ARE SUPPORTED BY THE DOCUMENTARY EVIDEN CES EXCEPT FOR A SUM OF RS.1,50,000/-. FOR THE SAKE OF CONVENIENCE, WE EXT RACT BELOW THE OBSERVATIONS MADE IN THE REMAND REPORT, WHICH ARE EXTRACTED BY L D CIT(A) IN PARA 5.2 OF HIS ORDER:- 5.2 IN RESPONSE TO THE SAME, THE ASSESSING OFFICER HAS SUBMITTED HIS REMAND REPORT VIDE LETTER DATED 18-01 -2013 AND THE CONTENTS THEREOF ARE REPRODUCED BELOW: '2. IN THIS CASE, ASSESSMENT WAS COMPLETED U/S 144 AS NO DETAILS WERE FURNISHED. IN THE ASSESSMENT ORDER, ADDITION W AS MADE FOR CASH DEPOSITS IN PUNJAB MAHARASHTRA CO-OP BANK, AND HERI(E), MUMBAI, BY THE ASSESSEE TREATED AS UNEXPLAINED CASH CREDIT U/S 68 OF THE INCOME TAX ACT, 1961 OF RS.29,18,900/-. THE ADDITION WAS MADE AS THE AIR INFORMATION OF CASH DEPOSITS WAS NO T EXPLAINED. IN APPELLATE PROCEEDINGS, THE ASSESSEE CLAIMED THAT TH E CASH DEPOSITS IN BANK ACCOUNT ARE EXPLAINED AND SUBMITTED THAT TH E ADDITION IS NOT CALLED FOR. 3. IN APPELLATE PROCEEDINGS, A PAPER BOOK CONTAININ G VARIOUS DOCUMENTS IN SUPPORT OF THE ABOVE CLAIMED WAS FILED AS ADDITIONAL EVIDENCES UNDER RULE 46A BY THE ASSESSEE. COPY OF T HE SAME WAS SENT TO THIS OFFICE FOR VERIFICATION. IN ORDER TO V ERIFY THESE ITA 3674/MUM/2013 3 DOCUMENTARY EVIDENCES FILED BY THE ASSESSEE, THE BO OKS OF ACCOUNTS AND OTHER SUPPORTING DOCUMENTS WERE CALLED FOR. 4. IN RESPONSE TO THE ABOVE, SHRI ASHOK LADHA, FCA FROM M/S LADDHA & LADDHA, CHARTERED ACCOUNTANTS AND REPRESEN TATIVE OF THE ASSESSEE COMPANY ATTENDED AND EXPLAINED THE CASE. I T IS SEEN THAT CASH DEPOSITS IN BANK ACCOUNT ARE DULY REFLECTED IN THE CASH BOOK / BOOKS OF ACCOUNT AND ARE SUPPORTED BY THE DOCUMEN TARY EVIDENCE EXCEPT RS.1,50,000/. THE ASSESSEE HAS CLAIMED THAT HE DEPOSITED CASH IN BANK ACCOUNT ON 5.6.2008 OUT OF THE SUM BE LONGING TO HIS GRAND FATHER AMOUNTING TO RS. 1,50,000/- WHICH WAS TEMPORARILY LYING WITH HIM. ON BEING ASKED, THE ASSESSEE FURNIS HED THE CONFIRMATORY LETTER FOR THE SAME. IT IS SEEN THAT T HE GRANDFATHER OF THE ASSESSEE IS NOT ASSESSED TO TAX AND HE RETIRED FROM SERVICE LONG BACK AND IS A SENIOR CITIZEN AGED MORE THAN 75 YEAR S OLD. THE CLAIM OF THE ASSESSEE IS NOT SUBSTANTIATED FOR RS.1,50,00 0/- AND THEREFORE THE ADDITION FOR THIS AMOUNT NEEDS TO BE UPHELD. THE LD CIT(A) SUPPLIED A COPY OF THE REMAND REPORT TO THE ASSESSEE AND SOUGHT FOR HIS EXPLANATIONS/ OBJECTIONS. AFTER CONSIDERIN G THE EXPLANATIONS / OBJECTIONS OF THE ASSESSEE, THE LD CIT(A) SUSTAINED THE ADDITI ON TO THE EXTENT OF RS.1,50,000/- AND DELETED THE BALANCE AMOUNT OF ADD ITION. AGGRIEVED BY THE ORDER PASSED BY LD CIT(A), THE REVENUE HAS FILED T HIS APPEAL BEFORE US. 4. WE HAVE HEARD LD D.R AND PERUSED THE RECORD. WE HAVE ALREADY NOTICED THAT THE LD CIT(A) HAS FOLLOWED THE VIEW EXPRESSED BY THE ASSESSING OFFICER IN THE REMAND REPORT GIVEN TO HIM AND ACCORDINGLY CONF IRMED THE ADDITION TO THE EXTENT OF RS.1,50,000/- AND DELETED THE BALANCE AMO UNT OF ADDITION. THE AO HAS MADE THE ADDITION OF RS.27,68,900/- ONLY FOR WANT O F EVIDENCES / SOURCES FOR MAKING THE DEPOSITS. IN FACT, THE ASSESSMENT WAS CO MPLETED TO THE BEST OF JUDGEMENT OF THE ASSESSING OFFICER U/S 144 OF THE A CT. HOWEVER, IN THE APPELLATE PROCEEDINGS BEFORE LD CIT(A), THE ASSESSEE HAS EXPL AINED THE SOURCES OF THE DEPOSITS AND THE ASSESSING OFFICER HAS ALSO EXAMINE D THE SAID EXPLANATIONS AND ACCORDINGLY GAVE THE REMAND REPORT BY EXPRESSLY STA TING THAT THE ABOVE SAID ITA 3674/MUM/2013 4 AMOUNTS, EXCEPT FOR A SUM OF RS.1,50,000/-, ARE DUL Y REFLECTED IN THE CASH BOOK / BOOKS OF ACCOUNT. UNDER THESE SET OF FACTS, WE ARE UNABLE TO UNDERSTAND AS TO HOW THE REVENUE IS AGGRIEVED BY THE DECISION RENDER ED BY LD CIT(A), WHEN HE HAS SIMPLY FOLLOWED THE VIEW EXPRESSED BY THE ASSES SING OFFICER IN THE REMAND REPORT. HENCE, WE DO NOT FIND ANY MERIT IN THE GRO UNDS URGED BY THE REVENUE. 5. WE HAVE ALREADY NOTICED THAT THE ASSESSMENT WAS COMPLETED U/S 144 OF THE ACT, BUT IT WAS WRONGLY MENTIONED AS SE. 143(3) IN THE ASSESSMENT ORDER. WE NOTICE THAT THE REGISTRY HAS SENT A DEFECT MEMO TO THE REVENUE POINTING OUT THIS DEFECT, BUT TILL DATE THE REVENUE HAS TAKEN NO STEP TO RECTIFY THE SAME. HENCE, ON THIS COUNT ALSO, THIS APPEAL DESERVES TO BE DISM ISSED. 6. THE FOREGOING DISCUSSIONS WOULD SHOW THAT THE IMPUGNED APPEAL FALLS IN THE CATEGORY OF FRIVOLOUS APPEAL. WE HAVE BEEN READ ING IN THE NEWS PAPERS THAT THE GOVERNMENT OF INDIA IS DISCOURAGING FILING OF S UCH FRIVOLOUS APPEALS, SINCE IT IS CAUSING UNWARRANTED HARASSMENT TO THE ASSESSEES AND ALSO OVER BURDENS THE JUDICIARY, WHICH IS ALREADY HARD PRESSED FOR TIME A ND RESOURCES FOR DISPOSING OF LONG PENDING APPEALS. BEFORE US, THE LD D.R SUBMIT TED THE GOVERNMENT OF INDIA HAS ALREADY FORMED A COMMITTED TO IDENTIFY THE WAYS AND MEANS TO REDUCE / WEED OUT SUCH KIND OF FRIVOLOUS APPEALS AND ACCORDI NGLY SUBMITTED THAT SUCH KIND OF FRIVOLOUS APPEALS SHALL BE AVOIDED IN FUTURE. 7. VARIOUS BENCHES OF THIS TRIBUNAL IS NOTICIN G THAT THE REVENUE HAS BEEN FILING SUCH KIND OF FRIVOLOUS APPEALS BEFORE THE TR IBUNAL IN A ROUTINE MANNER WITHOUT PROPERLY APPRECIATING THE FACTS AVAILABLE I N EACH CASES. A CO-ORDINATE BENCH OF TRIBUNAL CONSISTED OF HONBLE VICE PRESIDE NT AS ONE OF THE PARTIES, HAS ALREADY EXPRESSED ITS DISPLEASURE OVER THE CONDUCT OF THE REVENUE BY MAKING ITA 3674/MUM/2013 5 FOLLOWING OBSERVATIONS IN ITS ORDER DATED 13.06.201 4 PASSED IN THE CASE OF ITO VS. M/S GROWEL ENERGY CO. LTD IN ITA NO.338/MUM/201 1(AY-2007-08) (PARA 2 AND 28 (PGS.1 AND 14 OF THE ORDER): 2. AT THE OUTSET IT MAY BE MENTIONED THAT THE INCOM E TAX OFFICER, WHO IS THE APPELLANT HEREIN, AS WELL AS THE COMMISSIONER O F INCOME TAX, WHO HAS AUTHORISED THE AO TO PREFER AN APPEAL, DID NOT APPL Y THEIR MIND IN THE CORRECT PERSPECTIVE AND IN A VERY LACKLUSTRE AND RO UTINE MANNER FILED THE APPEAL WHICH, IN TURN, RESULTED IN WASTAGE OF TIME OF THE COURT WHICH WOULD BE HIGHLIGHTED AT APPROPRIATE PLACES. 28. AS WE HAVE ALREADY MENTIONED, ON ACCOUNT OF IMP ROPER ACTION ON THE PART OF THE COMMISSIONER OF INCOME TAX AS WELL AS THE AO, THE ASSESSEE HAD TO ENGAGE A COUNSEL AND INCUR SUBSTANT IAL EXPENDITURE TO DEFEND ITS CASE. THEREFORE WE AWARD A TOKEN COST OF `5,000/- UPON THE COMMISSIONER OF INCOME TAX WHO HAS GIVEN THE AUTHOR ISATION AND COST OF RS.10,000/- UPON THE AO WHO HAS FILED THIS APPEAL. 8. IT IS UNFORTUNATE THAT THE ASSESSING OFFIC ER, AFTER EXPRESSING SATISFACTION OVER THE EXPLANATIONS / INFORMATION FURNISHED BY TH E ASSESSEE DURING THE REMAND PROCEEDINGS WITH REGARD TO THE SOURCES OF THE IMPUG NED DEPOSITS, HAS CHOSEN TO FILE THE PRESENT APPEAL. THE AUTHORISATION GIVEN B Y THE LD COMMISSIONER OF INCOME TAX, A TOP LEVEL OFFICER OF THE DEPARTMENT, ONLY SHOWS THAT HE HAS NOT APPLIED HIS MIND AT ALL IN THE IMPUGNED MATTER. FR OM THE FACTS PREVAILING IN THE INSTANT CASE, IT CAN BE SEEN THAT THE ISSUE CONTEST ED BEFORE US DOES NOT INVOLVE ANY SUBSTANTIAL QUESTION OF LAW, WHICH MAY SOME TIM ES COMPEL THE REVENUE TO FILE APPEALS IN ORDER TO KEEP THE ISSUE ALIVE. IT IS HIGH TIME THAT THE REVENUE SHOULD TAKE THIS MATTER SERIOUSLY AND MAY CONSIDER WITHDRAWING FRIVOLOUS APPEALS FILED BY THEM, WHICH WILL BENEFIT ALL THE CONCERNED . FURTHER IT WOULD ALSO SAVE THE TIME AND RESOURCES OF REVENUE, WHICH CAN BE UTILIZE D IN A MEANINGFUL AND PROFITABLE MANNER. ITA 3674/MUM/2013 6 9. HENCE, IT IS REGRETTABLE THAT BOTH THE OFFIC ERS HAVE LOST SIGHT OF THE FACT THAT THEIR ACTION WOULD PUT THE ASSESSEE IN A UNCOMFORTA BLE SITUATION AND WOULD ALSO COMPEL HIM TO SPEND MONEY AND TIME IN DEFENDING THE APPEAL. THEREFORE, IN ORDER TO DISCOURAGE THE REVENUE FROM FILING THE FRI VOLOUS APPEALS, THAT TOO WITHOUT PROPER APPLICATION OF MIND, WE AWARD A TOKE N COST OF RS.1,000/- (ONE THOUSAND) UPON THE REVENUE. 10. THE SAID PAYMENT SHOULD BE MADE TO THE ASSES SEE WITHIN ONE MONTH FROM THE DATE OF RECEIPT OF THIS ORDER. 11. ACCORDINGLY, THE APPEAL FILED BY THE REVENU E IS DISMISSED WITH COSTS. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COUR T ON 28TH AUG, 2014 . 2 %$ . 3 4 5 628 TH AUG, 2014 - 9/ : SD SD ( . / D. MANMOHAN ) ( . . , / B.R. BASKARAN ) / VICE- PRESIDENT / ACCOUNTANT MEMBER . / MUMBAI: 28TH AUG,2014. . ' . ./ SRL , SR. PS !'#$% &%'# / COPY OF THE ORDER FORWARDED TO : 1. !&' / THE APPELLANT 2. ()&' / THE RESPONDENT. 3. . ?0 ( ! ) / THE CIT(A)- CONCERNED 4. . ?0 / CIT CONCERNED 5. @A9 ('0'B# , !1 !B#$ , . / / DR, ITAT, MUMBAI CONCERNED 6. 9 / / GUARD FILE. C . / BY ORDER, TRUE COPY * (ASSTT. REGISTRAR) !1 !B#$ , . / /ITAT, MUMBAI