NARSHI G PATEL, MUMBAI V. ASST CIT CEN CIR 22, MUMBAI

ITA 4019/MUM/2013

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 1819 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 6 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-12-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 09-09-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 20-05-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: RESPECTIVELY PASSED
• Keywords: Search and seizure; Question of law
• Section: 143(3); 132

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUM BAI . . , , !' #$, % , & BEFORE SHRI B.R.BASKARAN, AM AND SHRI AMARJIT SINGH , JM / I.T.A. NO.4023/M/13 ( % ' (' / ASSESSMENT YEAR: 2004-05) SHRI DHARAMSHI G. PATEL 10, MITHILA SHOPPING CENTRE, V.M.ROAD, JUHU SCHEME, VILE PARLE(W), MUMBAI - 400049 / VS. ASST. COMMISSIONER OF INCOME TAX CEN. CIR. 22, ROOM NO.465, AAYKAR BHAVAN, M.K.ROAD, MUMBAI - 400020 ./ ./ PAN/GIR NO. : AABPP3539Q / I.T.A. NO.4019/M/13, I.T.A. NO.4020/M/13, I.T.A. NO .4021/M/13 & I.T.A.NO.4022/M/13 ( % ' (' / ASSESSMENT YEAR: 2005-06, 2006-07,2007-08, 2008-09) SHRI NARSHI G. PATEL 10, MITHILA SHOPPING CENTRE, V.M.ROAD, JUHU SCHEME, VILE PARLE(W), MUMBAI - 400049 / VS. ASST. COMMISSIONER OF INCOME TAX CEN. CIR. 22, ROOM NO.465, AAYKAR BHAVAN, M.K.ROAD, MUMBAI - 400020 / I.T.A. NO.3955/M/13 ( % ' (' / ASSESSMENT YEAR: 2009-10) SHRI NARSHI G. PATEL 10, MITHILA SHOPPING CENTRE, V.M.ROAD, JUHU SCHEME, VILE PARLE(W), MUMBAI - 400049 / VS. ASST. COMMISSIONER OF INCOME TAX CEN. CIR. 22, ROOM NO.465, AAYKAR BHAVAN, M.K.ROAD, MUMBAI - 400020 ./ ./ PAN/GIR NO. : AABPP3538R ( / APPELLANT ) .. ( / RESPONDENT ) ITA NO. 4019/M/13 TO ITA 4023/M/13 &ITA3955/M/13 A.Y. 2004-05 TO 2009-10 2 / DATE OF HEARING: 09.09.2015 !' /DATE OF PRONOUNCEMENT: 16.12.2015 #$ / O R D E R PER AMARJIT SINGH, JM: THE ABOVE SAID APPEALS HAVE BEEN FILED BY THE ASSE SSEE AGAINST THE SEPARATE IMPUGNED ORDER DATED 18.02.2013 & 15.02.20 13 RESPECTIVELY PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-39 , MUMBAI [HEREINAFTER REFERRED TO AS THE LEARNED CIT(A)] FOR THE QUANTU M ASSESSMENT PASSED U/S. 143(3) R.W.S.153A OF THE INCOME TAX ACT, 1961( IN SHORT T HE ACT) IN THE ASSESSMENT YEAR 2004-05 IN CASE OF SHRI DHARAMSHI G. PATEL AND 2005-06 TO 2009-10 IN THE OTHER CASES BELONGING TO SHRI NARSHI G. PATEL. SIN CE COMMON QUESTION OF LAW AND FACTS ARE INVOLVED IN THESE APPEALS THEREFORE THEY ARE BEING TAKEN TOGETHER FOR ADJUDICATION FOR THE SAKE OF CONVENIENCE. 2. THE FACTS OF THE CASE ARE THAT A SEARCH AND SEIZ URE ACTION U/S. 132 WAS CONDUCTED ON 16.11.2009 IN THE CASE OF M/S. M. R. C ONSTRUCTION AND M/S. OPTION DEVELOPERS & BUILDERS. SHRI DHARAMSHI G. PATEL AND SHRI NARSHI G. PATEL ARE THE MAIN PERSON OF M/S. OPTION DEVELOPERS & BUILDERS. THE ASSESSEE SHRI DHARAMSHI G. PATEL AND SHRI NARSHI G. PATEL ARE PARTNERS IN M /S. BABY BELL AND M/S. OPTIONS DEVELOPERS & BUILDERS. DURING THE COURSE OF SEARCH PROCEEDINGS, COPIES OF PASSPORT IN THE NAME OF ASSESSEES WERE FOUND AND E XAMINED. ASSESSEE TRAVELED NUMBER OF TIMES IN THE FOREIGN COUNTRIES IN THE ASS ESSMENT RELEVANT YEARS AND WAS ASKED TO EXPLAIN ABOUT THE TRAVELLING. ASSESSEE WA S ASKED TO EXPLAIN THEIR FOREIGN TRAVELLING AND IN CASE OF SHRI DHARAMSHI G. PATEL HE REPLIED VIDE LETTER DATED 21.12.2011 WHICH IS HEREBY REPRODUCED BELOW: ASSESSEE BY: SHRI KRISH B. DESAI DEPARTMENT BY: SHRI K.B.SHUKLA (CIT-DR) ITA NO. 4019/M/13 TO ITA 4023/M/13 &ITA3955/M/13 A.Y. 2004-05 TO 2009-10 3 DEPARTURE DATE ARRIVAL DATE LOCATION NO. OF DAYS STAYED OUTSIDE INDIA EXP. 1-APR-03 6-APR-03 MUMBAI--->BANGKOK---> MUMBAI 5 18,650 17-MAY-03 22-MAY-03 MUMBAI--->BANGKOK---> MUMBAI 5 18,000 27-JUL-03 8-AUG-03 MUMBAI--->ITALY---> MUMBAI 12 59,000 6-SEP-03 13-SEP-03 MUMBAI--->ITALY---> MUMBAI 7 49,000 2-OCT-03 11-OCT-03 MUMBAI--->HONGKONG---> BANGKOK---> MUMBAI 9 32,500 26-FEB-04 6-MAR-04 MUMBAI--->BANGKOK---> HONGKONG--->MUMBAI 9 39,000 6-MAR-04 13-MAR-04 MUMBAI--->ITALY---> MUMBAI 7 49,000 2,65,150 THE ASSESSEE HAD BEEN IN ITALY FOR AROUND 61 DAYS (INCLUDING THE DAYS OF TRAVEL). THE ASSESSEE HAS NOT GIVEN THE BREAK U P OF COST OF STAY AND TRAVEL AND OTHER DETAILS. NO SUPPORTING DOCUMENTS IN THIS RE GARD LIKE TRAVEL BILLS, HOTEL BILLS ETC WERE PROVIDED BY THE ASSESSEE. THEREFORE THE AS SESSING OFFICER ASSESSED THE ESTIMATED EXPENSES MENTIONED BELOW: EST. AMT. SPENT ON TRAVEL TO AND FRO EST. AMT. SPENT ON FOOD@1000 PER DAY STAY @5000 PER DAY MISC. EXP. LIKE PURCHASE AND ENTERTAINMENT TOTAL AMT. AS PER DEPT.EST. AMT. OFFERED BY ASSESSEE DIFFERENCE 5,00,000 61,000 3,05,000 1,75,000 10,41,000 2,65,15 0 7,75,850 THUS THE INCOME TO THE TUNE OF RS.7,75,850/- WAS E NHANCED IN CASE OF DHARAMSHI G. PATEL HOWEVER, IN APPEAL A RELIEF OF 50% WAS GRANTED BY THE LEARNED CIT(A). FEELING NOT SATISFIED THE ASSESSEE HAS FIL ED THE APPEAL BEFORE US. 3. NOW COMING TO THE OTHER APPEALS RELATING THE SHR I NARSHI G. PATEL ON THE BASIS OF FACTS AND CIRCUMSTANCES MENTIONED ABOVE TH E ASSESSING OFFICER ASSESSED THE ESTIMATED EXPENSES EFFECTIVE IN THE FOREIGN COU NTRIES TO THE TUNE OF RS.5,24,950/- FOR A.Y.2005-06, RS.5,18,940/- FOR A. Y. 2006-07, RS.4,19,100/- FOR ITA NO. 4019/M/13 TO ITA 4023/M/13 &ITA3955/M/13 A.Y. 2004-05 TO 2009-10 4 A.Y.2007-08, RS.3,38,300/- FOR A.Y.2008-09 AND RS.3 ,30,500/- FOR A.Y.2009-10 RESPECTIVELY. SUBSEQUENTLY, THE ASSESSEE FILED THE APPEAL BEFORE LEARNED CIT(A) AND LEARNED CIT(A) HAS GRANTED RELIEF TO THE EXTENT OF 50% IN CASE OF SHRI DARMSHI G. PATEL FOR A.Y.2004-05 AND IN CASE OF SHRI NARSHI G. PATEL 50% FOR A.Y.2005- 06,40% FOR A.Y.2006-07,30% FOR A.Y.2007-08,20% FOR A.Y.2008-09 & 10% FOR A.Y.2009-10 OF THE EXPENDITURE ASSESSED BY THE ASSE SSING OFFICER. THE ASSESSEE WAS NOT SATISFIED HENCE THE PRESENT APPEALS HAVE BE EN FILED BEFORE US. 4. WE HAVE HEARD THE RIVAL CONTENTIONS OF THE PARTI ES AND HAVE GONE THROUGH THE FILES CAREFULLY. THE LEARNED REPRESENTATIVE OF THE ASSESSEE HAS ARGUED THAT IN THE CASE OF ASSESSEES BROTHER SHRI SURESH G. PATEL WHO SE SEARCH AND SEIZURE ACTION U/S.132(1) WAS CONDUCTED ON THE SAME DATE I.E.16.11 .2009. HONBLE TRIBUNAL HAS GRANTED THE RELIEF TO THE EXTENT OF 60% OF THE EXPE NDITURE ASSESSED BY ASSESSING OFFICER AND THE DAY OF JOURNEY WAS ALSO NOT INCLUDE D FOR THE PURPOSE OF STAY AND FOOD ETC. THEREFORE, IN THE SAID CIRCUMSTANCES THE SAID ORDER PASSED BY THE HONBLE TRIBUNAL, MUMBAI BENCH IN CASE ITA NO.4024&4025/MUM /13 FOR THE A.Y.2004- 05 & 2006-07 IS QUIT APPLICABLE TO THE PRESENT CASE THEREFORE ACCORDINGLY THE RELIEF IS REQUIRED TO BE GRANTED. ON THE OTHER HAND THE L EARNED REPRESENTATIVE FOR THE DEPARTMENT STRONGLY RELIED UPON LEARNED CIT(A) IN Q UESTION. ORDER DATED 04.03.2015 PASSED BY THE CO-ORDINATE BENCH, MUMBAI IN ITA NO.4024&4025/MUM/13 FOR THE A.Y.2004-05 & 2006-07 P ERUSED WHICH SPEAKS THAT THE SEARCH & SEIZURE ACTION U/S.132(1) WAS CON DUCTED UPON SHRI SURESH G. PATEL ON 16.11.2009 ON THE SAME DATE WHEN THE SEARC H & SEIZURE ACTION U/S.132(1) WAS CONDUCTED AGAINST SHRI DHARAMSHI G. PATEL AND S HRI NARSHI PATEL ASSESSEES UNDER APPEAL. THE FACTS & CIRCUMSTANCES OF THE PRE SENT CASES ARE QUITE SIMILAR TO THE PRESENT CASE. IN THE CASE OF SHRI SURESH G.PAT EL THE LEARNED CIT(A) HAS GRANTED THE RELIEF TO THE EXTENT OF 60% OF THE EXPENDITURE ASSESSED BY ASSESSING OFFICER FOR ITA NO. 4019/M/13 TO ITA 4023/M/13 &ITA3955/M/13 A.Y. 2004-05 TO 2009-10 5 THE A.Y.2004-05 & 2006-07. IN THE PRESENT CASE REL ATING TO SHRI DHARAMSHI G. PATEL FOR A.Y.2004-05, OF LEARNED CIT(A) HAS GRANTE D THE RELIEF TO THE EXTENT OF 50% EXPENDITURE ASSESSED BY THE ASSESSING OFFICER A ND IN CASE OF SHRI NARSHI G. PATEL LEARNED CIT(A) HAS GRANTED THE RELIEF TO THE EXTENT OF 50% FOR A.Y.2005-06, 40% FOR A.Y.2006-07, 30% FOR A.Y.2007-08, 20% FOR A .Y.2008-09 & 10% FOR A.Y.2009-10. THERE IS NO ANY COGENT AND CONVINCIN G REASON ON RECORD THAT WHY THE PARITY IN GRANTING THE RELIEF WAS NOT MAINTAINE D IN ALL THE CASES. SEARCH AND SEIZURE ACTION WAS TAKEN AGAINST ALL OF THEM ON THE SAME DATE. ALL THE ASSESSEES ARE BROTHERS. THE FACTS AND CIRCUMSTANCES OF THE EACH CASE ARE SAME. ALL WERE NOT HAVING PROPER DOCUMENTS ON RECORD TO SUBSTANTIATE A ND TO JUSTIFY THIS CLAIM. WE FIND NO REASON FOR NOT RELYING UPON THE ORDER PASSE D BY THE CO-ORDINATE BENCH, MUMBAI. THEREFORE, BY HONORING THE DECISION OF THE CO-ORDINATE BENCH MUMBAI IN ITA NO.4024&4025/MUM/13 TITLED AS SHRI SURESH G. PA TEL WE ARE OF THE VIEW THAT THE ASSESSEE ADDITION IS HEREBY LIABLE TO BE REDUCE D BY 60% IN THE EACH ASSESSMENT YEAR UNDER QUESTION. SO FAR AS THE NON-COUNTING OF THE DAYS OF TRAVELING FOR THE PURPOSE OF STAY AND FOOD ARE CONCERNED, WE ARE OF T HE VIEW THAT THE DAY UNDER TRAVELLING FOR THE PURPOSE OF STAY AND FOOD ARE NOT REQUIRED TO BE COUNTED AND ACCORDINGLY THE MATTER IS REQUIRED TO BE CONSIDERED AGAIN BY ASSESSING OFFICER IN VIEW OF THE OBSERVATIONS MADE ABOVE. 5. IN THE RESULT, ALL THE APPEALS OF THE ASSESSEE A RE HEREBY PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH DECEMBER , 2015. SD/- S D/- (B.R.BASKARAN) (AMARJIT SINGH) # / ACCOUNTANT MEMBER %& # /JUDICIAL MEMBER ' ( MUMBAI; )# DATED : 16 TH DECEMBER, 2015 MP MP MP MP ITA NO. 4019/M/13 TO ITA 4023/M/13 &ITA3955/M/13 A.Y. 2004-05 TO 2009-10 6 * + ,%'#- .-(' / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. * ( ) / THE CIT(A)- 4. * / CIT 5. -./ &&01 , 01' , ' ( / DR, ITAT, MUMBAI 6. /34 5 / GUARD FILE. * / BY ORDER, - & //TRUE COPY// //$ ! (DY./ASSTT. REGISTRAR) , ' ( / ITAT, MUMBAI