JITEN MEHTA, MUMBAI V. ITO 21(1)(2), MUMBAI

ITA 4083/MUM/2013

• Counselvise Citation: 408319914 RSA 2013
• Duration Of Justice: 1 year(s) 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-11-2014
• Appeal Filed By: Assessee
• Bench Allotted: J
• Next Hearing Date: 13-11-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 21-05-2013
• Court: TRIBUNAL
• Department Lawyers: AKHILENDRA P YADAV
• Assessee Lawyers: ANIL THAKRAL
• Keywords: Additional evidence
• Section: 144

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL J , BENCH MUMBAI , BEFORE : SHRI R.C.SHARMA , A M & SHRI SANJAY GARG, J M ITA NO. 4083 / MUM/20 1 3 ( ASSESSMENT YEAR : 200 7 - 08 ) SHRI JITEN MEHTA, 33 - A, SAI CHINTA, PRARTHANASAMAJ ROAD, VILE PARLE(E), MUMBAI - 400 057 VS. ITO 21(1)(2), MUMBAI PAN/GIR NO. : A GLPM 0756 A ( APPEL LANT ) .. ( RESPONDENT ) /ASSESSEE BY : SHRI ANIL THAKRAL /REVENUE BY : SHRI AKHILENDRA P. YADAV DATE OF HEARING : 13 TH NOV , 201 4 DATE OF PRONOUNCEMENT : 13 TH NOV. 201 4 O R D E R PER R.C.SHARMA ( A .M.) : TH IS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A ) , DATED 18 - 3 - 23013 FOR THE ASSESSMENT YEAR 200 7 - 08 , IN THE MATTER OF ORDER PASSED U/S. 14 4 OF TH E I.T. ACT . , WHEREIN THE ASSESSEE HAS TAKEN FOLLOWING GROUNDS : - THE FOLLOWING GROUNDS OF APPEAL ARE WITHOUT PREJUDICE TO ONE ANOTHER 1) THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) ERRED IN CONFIRMING THE ADDITION OF UNDISCLOSED INCOME OF RS. 10,00,000/ - . 2) THE LEARNED CIT( A) ERRED IN CONFIRMING THE AD - HOC ADDITIONS MADE ON ACCOUNT OF SUNDRY CREDITORS TOTALING TO RS. 20,00,000/ - AS UNCONFIRMED AND AS NON - EXISTING LIABILITY. 3. THE APPELLANT PRAYS THAT; I) LEARNED COMMISSIONER OF INCOME TAX(APPEALS) ERRED IN CONFIRMING THE ADD ITION MADE BY THE ASSESSING OFFICER OF UNDISCLOSED INCOME OF RS.10,00,000/ - . THE AD HOC ADDITIONS MAY KINDLY BE DELETED. ITA NO. 4083 /1 3 2 II) THE ASSESSING OFFICER HAS NOT CONSIDERED THE TRADING ACTIVITY OF THE APPELLANT AND WITHOUT GOING INTO THE DETAILS AVAILABLE WITH HI M, HE HAS ABRUPTLY ADDED A SUM OF RS.10,00,000/ - AS NET PROFIT. THE AD HOC ADDITIONS MAY KINDLY BE DELETED. 2 . FACTS IN BRIEF ARE THAT RETURN DECLARING INCOME OF RS.2,09,190/ - WAS FILED. THE ASSESSEE IS A PROPRIETOR OF M/ S. JICON ENTERPRISES WHICH IS EN GAGED IN BUSINESS OF TRADING IN IRON & STEEL, PIPE FITTINGS AND HARDWARE ETC. THE AO OBSERVED THAT I N SPITE OF OPPORTUNITIES GIVEN DURING THE ASSESSMENT PROCEEDINGS, NO DETAILS WERE PROVIDED ON GROUNDS THAT THE ACCOUNTANT, WHO WAS HANDLING MATTER AND CARRY ING ALL THE BOOKS OF ACCOUNTS / BILLS & VOUCHERS, WAS NOT COOPERATING. THEREFORE IN ABSENCE OF ANY BOOKS OF ACCOUNTS / BILLS AND VOUCHERS BEING PRODUCED THE AO FRAMED ASSESSME N T U/S.144 AND CONCLUDED THAT GENUINENESS OF SALES, PURCHASES, VALUATION OF CLOSI NG STOCK AND EXPENSES COULD NOT BE VERIFIED. IN THE BACKGROUND OF THESE FACTS HE ESTIMATED ADDITIONAL PROFIT OF THE ASSESSEE AND ADDED RS.L 0 LACS TO COVER UP ALL THE ISSUES RELATING TO VERIFICATION OF PURCHASES AND EXPENSES AS WELL AS VALUATION OF CLOSING STOCK. IN ADDITION THE AO ALSO TREATED THE SUM OF RS. 20 LACS AS UNCONFIRMED AND NON EXISTING LIABILITY OUT OF THE TO TAL LIABILITY OF RS.2,03,69,270 / - SHOWN AS OUTSTANDING IN THE BALANCE SHEET AS ON 31/3/2007. 3. BY THE IMPUGNED ORDER THE CIT(A) CONFIRMED THE ADDITION, AGAINST WHICH ASSESSEE IS IN FURTHER APPEAL BEFORE US. 4. WE HAVE CONSIDERED RIVAL CONTENTIONS AND PERUSED THE RECORD. WE FOUND THAT DURING THE APPELLATE PROCEEDINGS, ASSESSEE FILED AN AFFIDAVIT STATING THAT BOOKS AND OTHER DETAILS WERE LYIN G WITH MR. ROHIT MEHTA, WHICH WERE NOT HANDED OVER BY HIM TO THE ASSESSEE TILL JANUARY, 2010 ITA NO. 4083 /1 3 3 AND, HENCE, THE SAME COULD NOT BE PRODUCED BEFORE THE AO AND IT WAS AFTER FILING AN FIR THAT THE BOOKS WERE RECOVERED FROM MR. MEHTA IN JANUARY, 2010. ACCORDINGLY, THE A SSESSEE REQUESTED TO ALLOW OPPORTUNITY TO PRODUCE BOOKS OF ACCOUNTS AND DETAILS BEFORE THE AO. CONSEQUENTLY, THE THEN CIT(A) VIDE HIS OFFICE LETTER DATED 29.4.2010 ASKED THE AO TO FURNISH THE REMAND REPORT AFTER EXAMINATION OF THE BOOKS OF ACCOUNTS A ND OTHER DETAILS WHICH WERE CLAIMED TO BE RECOVERED BY THE ASSESSEE FROM THE ACCOUNTANT IN THE MONTH OF JANUARY 2010. THE AO STATED THAT THE PLEA OF ASSESSEE THAT BOOKS OF ACCOUNTS WERE WITH THE CONSULTANT WAS ONLY AN EXCUSE/AFTERTHOUGHT. THEREAFTER SHRI A NIL THAKRAL & SHRI ASHOK GOKANI, CAS., ATTENDED TO THE OFFICE OF CIT(A) AND FURNISHED COPY OF THE AUDITED ACCOUNTS AND STATED THAT SAME MAY BE ACCEPTED AS ADDITIONAL EVIDENCE. THE CIT(A) ALSO OBSERVED THAT THE CLAIM OF ASSESSEE THAT BOOKS OF ACCOUNTS AND B ILLS/VOUCHERS WERE TAKEN AWAY BY THE ACCOUNTANT MR. MEHTA AND, HENCE, THE SAME COULD NOT BE PRODUCED DURING THE ASSESSMENT PROCEEDINGS SEEMS TO BE ONLY A MAKE - BELIEF ARGUMENT. IN SUM AND SUBSTANCE, THE ADDITIONAL EVIDENCE FURNISHED IN THE FORM OF BOOKS OF ACCOUNTS , BILLS AND VOUCHERS ETC. WERE NOT ADMITTED BY LOWER AUTHORITIES . LOOKING TO THE AFFIDAVIT OF THE ASSESSEE AS WELL AS THE FIR LODGED WITH THE POLICE REGARDING BOOKS OF ACCOUNTS BEING FORCEFULLY RETAINED BY ACCOUNTANT, IN THE INTEREST OF JUSTICE AND FAIR - PLAY NO HARM WILL BE CAUSED TO THE REVENUE IF THE ASSESSEE IS GIVEN ONE MORE OPPORTUNITY TO PRODUCE ALL THE BOOKS OF ACCOUNTS , BILLS AND VOUCHERS BEFORE THE AO FOR EXAMINATION. ACCORDINGLY, WE RESTORE THE ISSUE BACK TO THE FILE OF THE AO WITH THE DIR ECTION TO THE ASSESSEE TO APPEAR BEFORE THE AO WITHIN A PERIOD ITA NO. 4083 /1 3 4 OF THREE MONTHS FROM THE RECEIPT OF THE COPY OF THIS ORDER ALONG WITH BOOKS OF ACCOUNTS , BILLS AND VOUCHERS FOR ALLOWING THE AO TO EXAMINE THE SAME. IN CASE OF ANY FAILURE ON THE PART OF ASSESS EE TO APPEAR BEFORE THE AO, THE AO WILL BE AT LIBERTY TO DECIDE THE ISSUE ON MERITS. WE DIRECT ACCORDINGLY. 5 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES , IN TERMS INDICATED HEREINABOVE . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 13 /11/ 201 4 . /1 1 / 2014 SD/ - SD/ - ( ) ( SANJAY GARG ) ( ) ( R.C.SHARMA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED 13 / 11 /2014 /PKM , PS COPY OF THE ORDER FORWARDED TO : / BY ORDER, ( ASSTT. REGISTRAR) / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / THE CIT(A ) , MUMBAI. 4. / CIT 5. / DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//