MOTILAL T. PRAJAPATI, MUMBAI V. CIT 34, MUMBAI

ITA 3710/MUM/2015

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 2135 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-10-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2008-2009
• Appeal Filed On: 16-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MAURYA PRATAPDR
• Assessee Lawyers: DATTATRAY E BHANAGE
• Keywords: Unexplained cash credit; Principle of natural justice; Source of fund
• Section: 68

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES B, MUMBAI , , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ITA NO.3710/MUM/2015 ASSESSMENT YEAR 2008-09 SHRI MOTILAL T. PRAJAPATI, 266/5, PUSHPANJALI CHS, SECTOR 2, CHARKOP KANDIVALI (WEST), MUMBAI-400067 / VS. INCOME TAX OFFICER-24(2)(4), [NEW WARD 30(2)(2)] MUMBAI ( ! ' # /ASSESSEE) ( $ / REVENUE) PAN. NO. ALSPP0106H !' # / ASSESSEE BY SHRI DATTATRAY E BHANAGE $ / REVENUE BY SHRI MAURYA PRATAP-DR $% & # ' / DATE OF HEARING : 13/10/2015 & # ' / DATE OF ORDER: 21/10/2015 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER DA TED 28/02/2013 OF THE LD. FIRST APPELLATE AUTHORITY, MU MBAI. ON THE GROUND THAT THOUGH SEVERAL NOTICES WERE CLAI MED TO BE ISSUED TO THE ASSESSEE BUT NONE OF THE NOTICE WAS E VER SERVED MOTILAL T PRAJAPATI ITA NO.3710/MUM/2015 2 UPON THE ASSESSEE, THEREFORE, THE EX-PARTE IMPUGNED ORDER IS AGAINST THE PRINCIPLE OF NATURAL JUSTICE AND FURTHE R CONFIRMING THE ADDITION OF RS.9,39,000/- TOWARDS UNSECURED LOA NS ADDED AS UNEXPLAINED CASH CREDIT U/S 68 OF THE INCOME TAX ACT, 1961 (HEREINAFTER THE ACT). 2. DURING HEARING OF THIS APPEAL, THE LD. COUNSEL FOR THE ASSESSEE, SHRI DATTATRAY E BHANAGE, ADVANCED HI S ARGUMENTS WHICH ARE IDENTICAL TO THE GROUND RAISED BY EXPLAINING THE FACTUAL MATRIX. ON THE OTHER HAND, THE LD. DR, CONTENDED THAT IN SPITE OF NOTICES ISSUED TO THE AS SESSEE, NO COMPLIANCE WAS MADE, THEREFORE, THE ADDITION WAS RI GHTLY MADE. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACT, IN BRIEF, ARE THAT THE ASSESSEE IS A PROPRIETOR OF M/S SARIYAD EVI ENTERPRISES AND M/S AJIT CHEMIST, DECLARED INCOME O F RS.2,08,771/- IN HIS RETURN FILED ON 30/03/2010. LA TER ON, THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY, THEREFORE, NOTICE U/S 143(2) OF THE ACT ALONG WITH QUESTIONNA IRE WAS ISSUED TO THE ASSESSEE. THIS NOTICE WAS DULY SERVED UPON THE ASSESSEE. THE ASSESSEE ATTENDED THE ASSESSMENT PROC EEDINGS AND FURNISHED NECESSARY DETAILS AS CALLED FOR AND T HE SAME WERE VERIFIED. THE LD. ASSESSING OFFICER GOT AIR I NFORMATION THAT THE ASSESSEE PURCHASED IMMOVABLE PROPERTY FOR A CONSIDERATION OF RS.32 LAKH. THE ASSESSEE WAS ASKE D TO FURNISH THE SOURCE OF FUNDS FOR PURCHASING THE PROP ERTY ALONG WITH DOCUMENTARY EVIDENCE. THE ASSESSEE VIDE MOTILAL T PRAJAPATI ITA NO.3710/MUM/2015 3 COMMUNICATION DATED 14/11/2010 CLAIMED THAT THE PRO PERTY WAS PURCHASES FOR A CONSIDERATION OF RS.33,72,860/- WHICH INCLUDES STAMP DUTY, REGISTRATION FEE. IT WAS EXPLA INED THAT THE ASSESSEE TOOK HOUSING LOAN OF RS.20,35,000/- FR OM ICICI BANK AND TO SUBSTANTIATE THE CLAIM. THE ASSESSEE SU BMITTED DISBURSEMENT LETTER FROM THE BANK. THE REMAINING A MOUNT OF RS.15,39,000/- WAS CLAIMED TO BE BY WAY OF UNSECURE D LOANS FROM FOLLOWING PARTIES. S.N. NAME OF PARTY AMOUNT (RS.) 1 . NAKANI 25000 2. DURGA ENTERPRISES 100 000 3. RAMESHKUAMR M. CHOUDHARY 50000 4. AAI MATA ENTERPRISES 50000 5. TARACHAND RUPAJI 49000 6. PRADEEP JAIN 50000 7. RAJNIKANT K. PRAJAPATI 150000 8. USHABEN Y. SHAH 350000 9. ASHISH NAVIN SHAH 200000 10. VAISHALI TEJASH SHAH 200000 11. HEMA YOG ESH SHAH 100000 12. FULVANTI JAYANTILAL PARIKH 100000 13. TARACHANBHAI 115000 TOTAL 15,39,000 2.2. THE ASSESSING OFFICER FOUND THAT FOR THE AMOU NT OF RS.2,90,000/- (IN RESPECT OF FOUR PARTIES) NO LOAN CONFIRMATION FILED BY THE ASSESSEE AND WITH RESPECT TO THREE MOTILAL T PRAJAPATI ITA NO.3710/MUM/2015 4 PARTIES (AS DETAILED IN PARA 4.7 OF THE ASSESSMENT ORDER) , THESE PARTIES DEPOSITED CASH IN THEIR RESPECTIVE AC COUNTS BEFORE ISSUANCE OF CHEQUE, THUS, THE ASSESSING OFFI CER MADE ADDITION OF RS.9,39,000/-. 2.3. ON APPEAL, BEFORE THE LD. COMMISSIONER OF INC OME TAX (APPEALS), VARIOUS NOTICES WERE ISSUED. WE NOTE THAT FOR 23/06/2011, AS PER THE REVENUE, NOBODY APPEARED. TH E NOTICE FOR 19/06/2012 WAS RETURNED UNSERVED, AND TH E FURTHER NOTICE FOR 31/12/2012 NONE APPEARED. AS PER THE REVENUE, THE NOTICE FOR 18/01/2013, WAS RETURNED UN SERVED. WE FIND THAT THERE IS NO FINDING IN THE IMPUGNED OR DER THAT NOTICES WERE ACTUALLY SERVED UPON THE ASSESSEE, THE REFORE, IN THE ABSENCE OF SERVICE OF NOTICE, IN OUR VIEW, NO P ERSON SHOULD BE CONDEMNED UNHEARD AS THERE IS VIOLATION O F PRINCIPLE OF NATURAL JUSTICE, THEREFORE, WITHOUT GO ING INTO MERITS OF THE APPEAL, WE REMAND THIS APPEAL TO THE FILE OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) TO ADJUDIC ATE THE SAME AFRESH ON MERIT. THE ASSESSEE BE GIVEN OPPORTU NITY OF BEING HEARD WITH FURTHER LIBERTY TO FURNISH EVIDENC E, IF ANY, IN SUPPORT OF HIS CLAIM. THE ASSESSEE IS ALSO DIRECTED TO REMAIN VIGILANT AND TO APPROACH THE OFFICE OF THE COMMISSI ONER OF INCOME TAX (APPEALS) WITHIN ONE MONTH FROM THE RECE IPT OF THIS ORDER. THE LD. COMMISSIONER OF INCOME TAX (APP EALS) IS FREE TO ADJUDICATE THE APPEAL AS PER HIS CONVENIENC E ON A MUTUALLY DECIDED DATE. THUS, THE APPEAL OF THE AS SESSEE IS ALLOWED FOR STATISTICAL PURPOSES. MOTILAL T PRAJAPATI ITA NO.3710/MUM/2015 5 FINALLY, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 13/10/2015. SD/- SD/- ( RAJESH KUMAR ) (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER % MUMBAI; ( DATED : 21/10/2015 F{X~{T? P.S/. . . %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. *+,- / THE APPELLANT 2. ./,- / THE RESPONDENT. 3. 0 0 1# ( *+ ) / THE CIT, MUMBAI. 4. 0 0 1# / CIT(A)- , MUMBAI 5. 3$4 .# , 0 *+' * 5 , % / DR, ITAT, MUMBAI 6. 6! 7% / GUARD FILE. / BY ORDER, /3+# .# //TRUE COPY// / (DY./ASSTT. REGISTRAR) , % / ITAT, MUMBAI. MOTILAL T PRAJAPATI ITA NO.3710/MUM/2015 6 DATE INITIAL ORIGINAL ORDER DICTATED DIRECTLY ON COMPUTER 1. DRAFT DICTATED ON 13/10/15 TO 14/10/2015 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 14/10/2015 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS 6. DATE OF PRONOUNCEMENT SR.PS 7. FILE SENT TO THE BENCH CLERK SR.PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER