SHARON F. RODRIGUES, MUMBAI V. ITO 20(3)(2), MUMBAI

ITA 4088/MUM/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 1400 (ITAT-MUMBAI)
• Duration Of Justice: 11 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2006-2007
• Appeal Filed On: 02-07-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained investment; Additional evidence
• Section: 68; 144

Judgement Text

ITA NO. 4088/MUM/2009 ASSESSMENT YEAR : 2006-07 PAGE 1 OF 6 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI E BENCH, MUMBAI BEFORE SHRI D. MANMOHAN, (VICE PRESIDENT) AND SHRI PRAMOD KUMAR (ACCOUNTANT MEMBER) ITA NO. 4088/MUM/2009 ASSESSMENT YEAR 2006-07 DATE OF HEARING : 17.6.2010 MRS. SHARON F. RODRIGUES ...... APPELLA NT D-203, SUN VIEW APARTMENTS KONDIVITA LANE, YAC NAGAR ANDHERI (E), MUMBAI 400 059 PAN ACJPR8958B VS. INCOME TAX OFFICER, WARD 20(3)(2) .. R ESPONDENT R.NO.609, PIRAMAL CHAMGERS PAREL, MUMBAI 400 012 APPELLANT BY : SHRI SAMEER DALAL RESPONDENT BY : SHRI S.M. KESHKAMAT O R D E R PER PRAMOD KUMAR: 1. THIS IS AN APPEAL FILED BY THE ASSESSEE IS DIREC TED AGAINST THE LD. CIT(A)S ORDER DATED 27 TH FEBRUARY 2009, IN THE MATTER OF ASSESSMENT U/S 144 FOR ASSESSMENT YEAR 2006-07. GRIEVANCES RAISED BY THE ASSESSEE, A RE AS FOLLOWS:- ITA NO. 4088/MUM/2009 ASSESSMENT YEAR : 2006-07 PAGE 2 OF 6 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LD. CIT(A) ERRED IN CONFIRMING ADDITIONS OF RS.6,10,000 /- MADE BY THE ASSESSING OFFICER U/S 68 OF THE ACT EVEN THOUGH THE SAME WAS EXPLAINED DURING THE COURSE OF THE APPELLATE PROCEE DINGS WITH DOCUMENTARY EVIDENCE FILED BEFORE HIM. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) ERRED IN NOT ADMITTING ADDITIONAL EVIDENCE F ILED FOR INVESTMENTS MADE BY THE APPELLANT OF RS.8,20,000/- IN ICICI BANK LTD., PRUDENTIAL LIQUID PLAIN, OF RS.2,00,000/- MAD E BY HUSBAND OF THE APPELLANT IN ICICI BANK LTD, PRUDENTIAL DISCOVE RY FUND AND FOR SWITCH OVER OF INVESTMENT OF RS.2,00,000/- MADE BY THE APPELLANT FROM ONE SCHEME TO ANOTHER SCHEME OF THE SAME MUTUAL FUND. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) ERRED IN CONFIRMING ADDITIONS OF RS.6,10,000 /- MADE BY THE ASSESSING OFFICER U/S 68 OF THE ACT BY NOT ADMITTIN G ADDITIONAL EVIDENCE FILED FOR INVESTMENT MADE BY THE APPELLANT OF RS.8,20,000/- IN ICICI BANK LTD., PRUDENTIAL PLAN O F RS.2,00,000/- MADE BY THE APPELLANT FROM ONE SCHEME TO ANOTHER SC HEME OF THE SAME MUTUAL FUND MERELY ON THE TECHNICAL GROUND THA T NO REQUEST WAS MADE BY THE APPELLANT TO ADMIT THE SAME DURING THE APPELLATE PROCEEDINGS. 2. BRIEFLY STATED THE MATERIAL FACTS ARE LIKE THIS. IN THE COURSE OF SCRUTINY ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER TOOK NOTE OF THE INFORMATION COMING IN THROUGH THE ANNUAL INFORMATION REPORT (AI R) TO THE EFFECT THAT THE ASSESSEE HAS INVESTED RS.12,20,000/- IN MUTUAL FUND S. THE ASSESSEE WAS, ACCORDINGLY, GIVEN A SHOW CAUSE NOTICE ON 10 TH NOVEMBER 2008 TO EXPLAIN AS TO WHY 50% OF THE SAID AMOUNT I.E., WHICH WORKS OUT TO RS.6.10 LAKHS SHOULD NOT BE TREATED AS CASH CREDIT / UNEXPLAINED INVESTM ENT BY THE ASSESSEE. THIS SHOW CAUSE NOTICE WAS SERVED ON THE ASSESSEE ON 12 TH NOVEMBER 2008, FIXING THE HEARING ON 18 TH NOVEMBER 2008. ON THE SCHEDULED DATE OF HEARING, O NE SHRI R. RAMNATH, CHARTERED ACCOUNTANT, APPEARED AND HE WAS ISSUED THE QUESTIONNAIRE WITH REGARD TO ASSESSMENT. THE CASE W AS ADJOURNED TO 26 TH NOVEMBER 2000. ON THE SAID DATE, THERE WAS NO COMPL IANCE AND, ACCORDINGLY, ITA NO. 4088/MUM/2009 ASSESSMENT YEAR : 2006-07 PAGE 3 OF 6 THE ASSESSING OFFICER PROCEEDED TO FRAME ASSESSMENT U/S 144, WHEREIN THE ADDITION OF RS.6.10 LAKHS WAS MADE AS AN EXPLAINED INVESTMENT. 3. AGGRIEVED BY THE STAND SO TAKEN BY THE ASSESSING OF FICER, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A), WHEREIN IT WAS EXPLAINED THAT THERE WAS A DELAY IN OBTAINING THE STATEMENT O F INVESTMENT IN THE MUTUAL FUNDS AS THE INVESTMENT PERTAINED TO ALMOST THREE YEARS AND THE MUTUAL FUNDS MANAGERS COULD NOT PROVIDE REQUISITE S TATEMENT IMMEDIATELY. IT WAS ALSO SUBMITTED THAT THE INVESTMENT OF RS.12. 20 LAKHS DOES NOT ENTIRELY BELONG TO THE APPELLANT AND ONLY RS.8.20 LAKHS WERE INVESTED BY THE APPELLANT IN ADDITION TO THE SWITCH OVER FROM ONE F UND TO ANOTHER FOR RS.2.00 LAKHS. THE ASSESSEE ALSO FILED ADDITIONAL EVIDENCE IN SUPPORT OF HER CONTENTIONS. THE LD. CIT(A), HOWEVER, DECLINED TO A DMIT THE ADDITIONAL EVIDENCE AND REJECTED THE CONTENTIONS OF THE ASSESS EE WITHOUT ADDRESSING MEANS TO THE MERITS OF THE CASE. WHILE DOING SO, HE OBSERVED AS FOLLOWS:- 9. SO FAR AS THE ADDITION OF RS.6,10,000/- IN RESP ECT OF UNEXPLAINED INVESTMENT IN MUTUAL FUNDS IS CONCERNED , THE APPELLANT HAS FILED ADDITIONAL EVIDENCE BEFORE THE UNDERSIGNED. BUT NO REQUEST FOR ADMISSION OF THE SAME HAS BEEN M ADE. NEITHER IT HAS BEEN STATED AS TO WHY NO DETAILS IN THIS REG ARD WERE FURNISHED BEFORE THE A.O. ON 4 OCCASIONS I.E., ON 8 .11.2007, 21.10.2009, 18.11.2008 AND 26.11.2008, WHICH WERE T HE DATES OF THE HEARING FIXED BY THE A.O. FOR THIS PURPOSE. EVE N ON THE LAST DATE I.E., 26.11.2008, WHICH WAS FIXED BY THE A.O. ON THE REQUEST OF THE A.R. OF THE APPELLANT. FURTHER ANYBODY ATTENDED NOR ANY DETAILS WERE FILED. ALSO NO ADJOURNMENT WAS SOUGHT BY THE APPELLANT FOR AVAILING FURTHER TIME. IT IS ALSO SEE N FROM THE ASSESSMENT ORDER THAT THE A.O HAD EVEN THEREAFTER C ONTACTED THE A.R. OF THE APPELLANT ON HIS MOBILE NO.9892225581 A BOUT 4-5 TIMES BUT HE DID NOT BOTHER TO RESPOND TO HIS CALLS . THE APPELLANT HAS SUBMITTED BEFORE THE UNDERSIGNED THAT THERE WAS DELAY IN OBTAINING THE STATEMENT OF INVESTMENT IN MUTUAL FUN DS BECAUSE THE FUNDS COULD NOT PROVIDE IT IMMEDIATELY. HOWEVER , FIRSTLY THIS ITA NO. 4088/MUM/2009 ASSESSMENT YEAR : 2006-07 PAGE 4 OF 6 REASON FOR DELAY IS NOT CONVINCING BECAUSE THE APPE LLANT COULD HAVE PRODUCED THE COPY OF HER BANK ACCOUNT TO PROVE THE SOURCE OF INVESTMENT, IF THE INVESTMENT WAS MADE FROM HER BANK ACCOUNT. SECONDLY, THE APPELLANT HAS GIVEN NO EXPLANATION AS TO WHY SHE DID NOT SEEK FURTHER ADJOURNMENT TO AVAIL FURTHER T IME AND AS TO WHY HER AR DID NOT BOTHER TO RESPOND TO REPEATED TE LEPHONIC CALLS OF THE A.O. THE A.O. GAVE OPPORTUNITY TO THE APPELL ANT ON AS MANY AS 4 DATES OF HEARING SPREAD OVER THE PERIOD OF ABO UT ONE YEAR, BUT THE APPELLANT FAILED TO RESPOND TO IT. HE EVEN MADE TELEPHONIC CALLS TO THE A.R. FOR FURNISHING THE REQUISITE INFO RMATION, BIT HE DID NOT RESPOND. THIS SHOWS A CALLOUS ATTITUDE OF T HE APPELLANT / HER A.R. TOWARDS LEGAL / JUDICIAL PROCEEDINGS. THE APPELLANT DID NOT SHOW ANY RESPECT FOR LAW, INSPITE OF THE FACT T HAT THE A.O. TRIED HIS BEST TO OBTAIN INFORMATION FROM HER. IT IS EVID ENT THAT UNDER THESE CIRCUMSTANCES, THE A.O. WAS COMPELLED TO PASS THE ASSESSMENT ORDER EX-PARTE U/S 144 OF THE ACT. HENCE , THE ADDITIONAL EVIDENCE SUBMITTED BY THE APPELLANT CANN OT BE ADMITTED BECAUSE THE APPELLANT HAS NEITHER REQESTED FOR ITS ADMISSION NOR GIVEN ANY EXPLANATION IN TERMS OF CON DITIONS AND CIRCUMSTANCES PRESCRIBED IN CLAUSE (A) TO (D) OF RU LE 48A(1). ALSO FROM THE FCTS DESCRIBED ABOVE, IT IS CLEAR THAT THE APPELLANT DOES NOT HAVE ANY PLAUSIBLE EXPLANATION IN TERMS OF SAID CLAUSES (A) TO (D) OF RULE 46A. THEREFORE, THE ADDITIONAL EVIDENCE FURNISHED BY THE APPELLANT IS HEREBY NOT ADMITTED. 4. HAVING HEARD THE RIVAL CONTENTIONS AND HAVING PERUS ED THE MATERIAL ON RECORD, WE CONSIDER IT APPROPRIATE TO RESTORE THE M ATTER BACK TO THE FILE OF THE ASSESSING OFFICER FOR ADJUDICATION DENOVO AFTER GIVING REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. WE HAVE NOT ED THE ASSESSEES CONTENTION TO THE EFFECT THAT THERE WAS DELAY IN TH E PROCESS OF OBTAINING THE STATEMENT FROM THE MUTUAL FUNDS WHICH RESULTED IN A SSESSEES INABILITY TO FILE THE REQUISITE DETAILS BEFORE THE ASSESSING OFFICER, AND WE HAVE ALSO NOTED THAT AS SOON AS THE ASSESSEE WAS IN A POSITION TO O BTAIN THE STATEMENT, THOSE STATEMENTS WERE DULY FILED BEFORE THE LD. CIT(A). A LL THESE EXPLANATIONS WERE ALSO FILED BEFORE THE ASSESSING OFFICER HIMSELF AT THE STAGE OF PENALTY PROCEEDINGS U/S 271(1)(C). NON SUBMISSION OF DETAIL S TO THE ASSESSING ITA NO. 4088/MUM/2009 ASSESSMENT YEAR : 2006-07 PAGE 5 OF 6 OFFICER AT THE ASSESSMENT STAGE CANNOT, THEREFORE, BE SAID TO BE DELIBERATE OR MALAFIDE. IN OUR CONSIDERED VIEW, THEREFORE, THE EN DS OF JUSTICE WILL BE MET BY RESTORING THE MATTER TO THE FILE OF THE ASSESSIN G OFFICER. THE ASSESSING OFFICER IS DIRECTED TO FRAME THE ASSESSMENT AFRESH IN THE LIGHT OF OUR ABOVE OBSERVATIONS, AFTER GIVING A FRESH OPPORTUNITY OF H EARING TO THE ASSESSEE AND BY WAY OF A SPEAKING ORDER. 5. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED FOR STA TISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT TODAY ON THIS 30 TH DAY OF JUNE 2010. SD/XX SD/XX (D. MANMOHAN) (PRAMOD KUMAR) VICE PRESIDENT ACCOUNTANT MEMBER MUMBAI; 30 TH DAY OF JUNE 2010. COPY FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. DIRECTOR OF INCOME TAX (INTERNATIONAL TAXATION), MUMBAI 4. COMMISSIONER (APPEALS) , MUMBAI 5. DEPARTMENTAL REPRESENTATIVE, E BENCH, ITAT, MUMB AI 6. GUARD FILE TRUE COPY BY ORDER ASSISTANT REGISTRAR PRADEEP J. CHOWDHURY INCOME TAX APPELLATE TRIBUNAL SR. PRIVATE SECRETARY MUMBAI BENCHES, MUMBAI ITA NO. 4088/MUM/2009 ASSESSMENT YEAR : 2006-07 PAGE 6 OF 6 DATE INITIAL 1. DRAFT DICTATED ON 23.6.2010 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 23.6.2010 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 23.6.2010 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 23.6.2010 JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 23.6.2010 SR.PS/PS 6. DATE OF PRONOUNCEMENT 30.6.2010 SR.PS 7. FILE SENT TO THE BENCH CLERK 30.6.2010 SR.PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER