R.D. BUILDERS, NAVI MUMBAI V. ITO 22(3)(3), MUMBAI

ITA 4305/MUM/2011

• Counselvise Citation: 430519914 RSA 2011
• Duration Of Justice: 4 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 25-08-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 26-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ALEXANDER CHARLY
• Keywords: Additional evidence; Bogus loan
• Section: 68; 143(3); 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, D BENCH, MUMBAI. BEFORE SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER AND SMT ASHA VIJAYARAGHAVAN,, JUDICIAL MEMBER I.T.A NO.4305/ MUM/2011 ASSESSMENT YEAR: 2007-08 R.D.BUILDERS, .. APPELLANT 211, SHIV CENTRE, SECTOR-17, VASHI, NAVI MUMBAI PA NO.AAFFR 9782 H VS INCOME TAX OFFICER 22(3)(3) .. RESPONDENT MUMBAI. APPEARANCES: RAJESH B GUPTA, FOR THE APPELLANT ALEXANDER CHARLY,, FOR THE RESPONDENT DATE OF HEARING : 25.8.2011 DATE OF PRONOUNCEMENT : 21-10-2011 O R D E R PER PRAMOD KUMAR: 1. BY WAY OF THIS APPEAL, THE ASSESSEE HAS CALLED INTO Q UESTION CORRECTNESS OF CIT(A)S ORDER DATED 15 TH MARCH, 2011, IN THE MATTER OF ASSESSMENT UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961, FOR THE ASSESSMENT YEAR 2007-08 ON THE FOLLOWING GROUNDS: I.T.A NO.4305/ MUM/2011 ASSESSMENT YEAR: 2007-08 2 1. ON THE FACTS AND CONSIDERATION OF THE CASE IN LAW IN THE FIRST INSTANCE, THE LD ITO DISALLOWED RS.62,19,593 ON ACCOUNT OF NON RECEI PT OF CONFIRMATION OF UNSECURED LOANS RAISED BY US FOR OU R BUSINESS. THE ADDITION WAS MADE BASED ON CERTAIN PRESUMPTIONS AND ASSUMPTIONS BUT WITHOUT PROCESSING, THE ADDITION AS DESCRIBED UNDER THE SECTION 68 OF THE I.T.ACT, 1961. 2. ON THE FACTS AND CONSIDERATION OF THE CASE IN LA W, THE LD CIT(A) INCREASED THE QUANTUM OF NON RECEIPT OF CONFIRMATIO N OF UNSECURED LOANS FROM RS.62,19,593 TO RS.1,12,77,050 WHICH IS RESULT ED IN ENHANCEMENT OF THE ADDITION BY RS.50,57,457. 3. ON THE FACTS AND CONSIDERATION OF THE CASE IN LA W, THE LD AO HAS NOT PROVIDED ADEQUATE TIME FOR GETTING CONFIRMATION OF LOAN FROM MORE THAN 60 LENDERS FROM WHOM THE ASSESSEE HAS BORROWED FUND S FROM THOSE LENDERS FOR CARRYING BUSINESS ACTIVITIES. IN VIEW OF THE LARGE NUMBER OF LENDERS WHO ARE INSTRUMENTAL IN CARRYING OUT THE BU SINESS OF THE ASSESSEE, THE INFORMATION CALLED FOR BY THE AO EITH ER DELAYED OR THE INTIMATIONS SENT TO THEM WERE RETURNED FOR VARIOUS REASONS SUCH AS SHIFTING OF RESIDENCE, NON AVAILABILITY OF THE PERS ONS AT THE TIME OF DELIVERING THE NOTICES BY THE DEPARTMENT. 4. ON THE FACTS AND CONSIDERATION OF THE CASE AND I N LAW THE ASSESSEE HAS TO STATE THAT EACH AND EVERY AMOUNT OF LOAN OBTAINE D BY THE LENDERS RECEIVED BY WAY OF CHEQUE PAYMENT AND NOT A SINGLE CASE OF CASH TRANSACTIONS WHICH IS CLEARLY EVIDENT BY THE BANK S TATEMENTS SUBMITTED BY THE ASSESSEE FOR THE ENTIRE YEAR. 5. ON THE FACTS AND CONSIDERATION OF THE CASE AND IN LAW, THE ASSESSEE HAS MADE EVERY EFFORT TO MEET THE DEMANDS OF THE DEPART MENT WITH RIGHT EARNEST AND ALL THE NECESSARY DOCUMENTS IN SUPPORT OF THE LOANS WERE SUBMITTED FROM TIME TO TIME AS PER THE REQUIREMENTS FROM THE AO. OUT OF THE TOTAL UNSECURED LOANS OF RS.2,52,05,395 AT THE CLOSE OF THE FINANCIAL YEAR ONLY RS.1,12,77,050 WAS NOT CONSIDERED TO BE G ENUINE. THE ASSESSEE HAS HIS OWN LIMITATIONS IN GETTING THE CONFIRMATION FROM 66 LENDERS WITHIN A SHORT PERIOD 2 MONTHS AND WHATEVER ADDITIO NS MADE BASED ON PRESUMPTIONS AND NOT BASED ON ACTUAL VERIFICATION O F ALL THE DOCUMENTS. 2. BRIEFLY STATED, THE MATERIAL FACTS ARE LIKE THIS. THE ASSESSEE IS ENGAGED IN THE BUSINESS AS BUILDER AND DEVELOPERS. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTICED THAT UNSECURED LOANS AS AT T HE END OF RELEVANT PREVIOUS YEARS STOOD AT RS.2,52,05,395 WHEREAS, AS AT THE BEGINNI NG OF THE YEAR, UNSECURED LOANS ONLY AMOUNTED TO RS.1,89,85,802. THE ASSESSEE WAS ASKED TO FILE LIST OF NAMES AND ADDRESS OF THE PERSONS FROM WHOM LOAN WAS TAKEN DU RING THE YEAR, IN ORDER TO I.T.A NO.4305/ MUM/2011 ASSESSMENT YEAR: 2007-08 3 ISSUE NOTICE UNDER SECTION 133(6) OF THE ACT FOR THE PURPOSES OF CONFIRMATION AND VERIFICATION OF THE LOANS. HOWEVER, AS NOTED BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER, TILL THE TIME OF COMPLETING THE IMPUG NED ASSESSMENT, THE ASSESSEE DID NOT FILE ANY LIST OF PERSONS FROM WHOM LOANS WERE T AKEN NOR DID THE ASSESSEE FILE THE CONFIRMATION LETTERS. IT WAS IN THIS BACKDROP TH AT THE ASSESSING OFFICER PROCEEDED TO CONCLUDE THAT IN THE ABSENCE OF VERACITY OF LOAN S TAKEN RS.62,19,593 (RS.2,52,05,395 RS.1,89,85,802) ARE BEING DISALLOWE D AND ADDED TO THE TOTAL INCOME. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN APPEAL BE FORE THE CIT(A). IT WAS SUBMITTED BY THE ASSESSEE THAT EACH AND EVERY LOAN WAS OBTAINED BY CHEQUE AND THAT THE DELAY IN OBTAINING THE BALANCE CONFIRMATION WAS DUE TO THE FACTORS BEYOND ASSESSEES CONTROL. IN THE PROCEEDINGS BEFORE THE CIT(A) , THE ASSESSEE FILED THREE DIFFERENT SCHEDULES OF THE LOANS I) IN RESPECT OF CASE S WHERE THERE WAS OPENING BALANCE AS ALSO TRANSACTIONS DURING THE YEAR AND CLOSING BALANCE; 2) IN RESPECT OF CASES, IN WHICH THERE WAS ONLY OPENING BALANCE AND NO TRANSACTION DURING THE YEAR AND 3) IN RESPECT OF THE CASES IN WHICH LOANS WERE SQUA RED UP DURING THE RELEVANT PREVIOUS YEAR. THE ASSESSEE ALSO FILED CONFIRMATION LE TTERS IN RESPECT OF PARTIES WHOSE NAMES ARE APPEARING IN SCHEDULE-1 AND SCHEDULE-II. A LL THE DETAILS FILED BY THE ASSESSEE WERE REMITTED TO THE FILE OF THE ASSESSING OFFICE R FOR HIS COMMENTS AND THE AO ALSO FILED REMAND REPORT IN RESPECT OF THE CASE. S O FAR AS THE CASES IN WHICH NO AMOUNTS WERE RECEIVED IN THE RELEVANT PREVIOUS YEAR A ND THE BALANCE REFLECTED ONLY THE OPENING BALANCE, THE CIT(A) ACCEPTED THE GENUIN ENESS OF THESE CASES AND, ACCORDINGLY, ASSESSEES EXPLANATION WAS ACCEPTED. IN RES PECT OF SCHEDULE, WHERE THE ASSESSEE, VIS THE OPENING BALANCE AND ALSO THE TRANSACTION TOOK PLACE DURING THE RELEVANT PREVIOUS YEAR, THE CIT(A) PARTLY ACCEPTED T HE EXPLANATION OF THE ASSESSEE BUT HELD THE LOANS TO THE EXTENT OF RS.26,50,000 AS NOT GE NUINE. WHILE DOING SO, THE REASONING ADOPTED BY THE CIT(A) WAS AS FOLLOWS: 5.4 COMING TO REST OF PARTIES IN SCHEDULE I WHERE ASSESSING OFFICER COULD NO REPLY THEY ARE DISCUSSED NOW, IN CASE OF THESE THE ASSESSING OFFICER HAS REPORTED THAT NOTICES WERE ISSUED ON THE ADDRESSES GIVEN BY THE APPELLANT DURING THE I.T.A NO.4305/ MUM/2011 ASSESSMENT YEAR: 2007-08 4 REMAND PROCEEDINGS BUT THEY HAVE COME BACK. IN REPL Y THE APPELLANT HAS ONLY COMMENTED THAT PARTIES HAVE SHIFTED THE RESIDENCE A ND WHEN APPELLANT WAS INFORMED ABOUT THE SANE THEY CALLED THE PARTY AND R EQUIRED DETAILS WERE SUBMITTED BY THEM TO THE ASSESSING OFFICER. SAME IS THE CASE FOR MEGHNA SABHARWAL. THEY ARE DECIDED AS UNDER: (I) AS REGARDS SARITA AGGARWAL THE APPELLANT HAS IN FORMED THAT DETAILS WERE SUBMITTED BUT ASSESSING OFFICER DID NOT ACCEPT. SAM E ARE RE-SUBMITTED ALONG WITH REPLY GIVEN BY THE APPELLANT. I HAVE GONE THRO UGH THESE PAPERS IT IS SEEN THAT IN EASE OF SANTA AGGARWAL A COPY OF RETURN INC OME FOR ASSESSMENT YEAR 2007-08 HAS BEEN FILED SHOWING THE INTEREST INCOME RECEIVED FROM VARIOUS PARTIES INCLUDING R.D .BUILDERS ON WHICH TAX ALSO HA S BEEN DEDUCTED, ALONG WITH THIS COPY OF BANK ACCOUNT NO.3700001060294 AND CONF IRMATION OF ACCOUNT OF RD. BUILDERS HAS BEEN FURNISHED, IN VIEW OF THIS TH E LOAN TAKEN FROM SANTA AGGARWAL DURING THE YEAR RS.23 LAKHS IS ACCEPTED AN D TREATED AS GENUINE. (II) AS REGARDS MEGHNA SABHARWAL AND TJMA RANI J.GUPT A APPELLANT HAS NOT FURNISHED THESE DETAILS AND HENCE LOANS APPEARING I N THE NAME OF UMA RANI J.GUPTA AND MEGHNA SABHARWAL FOR RS.5,00000/- AND RS .I70,000/- ARE SUSTAINED. (III) THE APPELLANT HAS INFORMED THAT NISHA K.AGGAR WAL COULD NOT ATTEND AS SHE WAS NOT AT HOME, HOWEVER DETAILS WERE SUBMITTED WHI CH ASSESSING OFFICER DID NOT ACCEPT. HOWEVER NO SUCH CONFIRMATION OR DETAILS HAVE BEEN FURNISHED BY THE APPELLANT. IN VIEW OF THIS THE ADDITION FOR RS.2,50 ,000/- IS SUSTAINED. (IV) COMING TO RASHMI K.AGGARWAL APPELLANT HAS STAT ED THAT DIFFERENCE BETWEEN ACTUAL AND REFLECTED IS RS.5000/- AND SAME IS ACCEP TED. HENCE ADDITION FOR RS.5O00/ BEING THE DIFFERENCE IS SUSTAINED AGAINST THE LOAN REFLECTED IN THE NAME OF RASHMI KAGGARWAL. V) REGARDING GIRISH SLNGHAL APPELLANT HAS FURNISHED COPY OF LEDGER ACCOUNT HOWEVER IN VIEW OF CLEAR FINDING MADE BY ASSESSING OFFICER THAT THE LOANS REFLECTED BY THE APPELLANT WAS RS.4,00,000/- WHEREA S GIRISH SINGHAL CONFIRMED IT AT RS.2,00,000/- THE AMOUNT OF RS.2,00,000/- REMAIN S UNEXPLAINED AND HENCE SAME IS SUSTAINED BACK U/S.68. (VI) AS REGARDS AMIT V. AGGARWAL NO DETAILS HAVE BE EN FURNISHED BY THE APPELLANT THOUGH STATED IN THE REPLY AND HENCE AMOUNT OF RS.1 ,00,000/- IS SUSTAINED U/S.68 REFLECTED IN THE NAME OF AMIT V.AGGARWAL. I.T.A NO.4305/ MUM/2011 ASSESSMENT YEAR: 2007-08 5 VII) COMING TO KEWAL KRISHNA GUPTA APPELLANT HAS FU RNISHED COPY OF RETURN FILED. IT IS SEEN THAT INCOME FROM OTHER SOURCE AT RS.3,26 586/- IS SHOWN HOWEVER SAME IS NOT SUPPORTED BY ANY TDS OR LEDGER ACCOUNT CONFI RMATION AND HENCE IT CANNOT BE SAID THAT SHRI KEWAL KRISHNA GUPTA HAS CREDITWOR THY TO ADVANCE THIS LOAN OF AN AMOUNT OF RS.3,00,000/- TO THE APPELLANT. THE AS SESSING OFFICER IN HIS REMAND REPORT HAS ALREADY STATED THAT THE DETAILS FURNISHE D BY SHRI KEWAL KRISHNA GUPTA HAVE BEEN VERIFIED AND IT IS FOUND THAT THE LOAN HA S NOT HECN GIVEN BY CHEQUE. THERE IS NO BALANCE SHEET MAINTAINED BY SHRI KEWAL KRISHNA GUPTA AND IN VIEW OF THIS THE ASSESSING OFFICER CONCLUDING THAT THE LOANS APPEARING IN THE NAME OF KEWAL KRISHNA GUPTA, INDIVIDUAL FOR RS.3,00,000/- AND KEWAL KRISH NA GUPTA (HUF) FOR RS.3,00,000/- ARE NOT PROVED. I AGREE WITH THE ASSE SSING OFFICER THAT MERELY FILING THE RETURN SHOWING SOME INCOME WILL NOT PROV E CREDITWORTHY OF THE APPELLANT WHEN NO BOOKS OF ACCOUNTS ARE MAINTAINED AND THERE IS NO LOAN CONFIRMATION FOR THE SAME. HENCE ADDITION FOR RS.6, 00,000/- IS SUSTAINED. VIII) IN CASE OF RAKHI AGGARAAL ASSESSING OFFICER H AS GIVEN CLEAR FINDING THAT SHE COULD NOT EXPLAIN THE SOURCE OF CASH DEPOSIT IN HER BANK. JUST BEFORE ISSUING THE CHEQUE IN THE NAME OF R.D.BUILDERS FOR RS.70000/-. IN VIEW OF THIS THE AMOUNT OF RS.70,000/- IS TREATED AS UNEXPLAINED AND HENCE SUS TAINED. (IX) COMING TO SHRUTI AGGARWAL ASSESSING OFFICER HA S INFORMED THAT NO RESPONSE WAS RECEIVED FROM HER. THE APPELLANT HAS ONLY TAKEN THE PLEA THAT THERE WAS A DEATH IN HER FAMILY AND HENCE PAPERS WERE SUBMITTED AFTER 07.02.2011 HOWEVER I FIND THAT THERE ARE NO SUCH PAPERS FILED ALONG WI TH REPLY HENCE ADDITION FOR RS.2,00,000/- IS SUSTAINED U/S.6 8 APPEARING NAME OF SHRUTI AGGARWAL. (X) ON THE SAME LINES AMOUNT OF RS.50,000/- REFLECT ED IN THE NAME OI, AGGARWAL. THE ASSESSING OFFICER HAS REPORTED THAT SAID LOAN I S BEING GIVEN OUT OF UNEXPLAINED CASH DEPOSITS AND HENCE THIS AMOUNT IS SUSTAINED. . (XI} THEN COMING TO VARSHA AGGARWAL, VIJAYAKUMAR M.A GGARWAL, , VINOD M.AGGARWAL, KATNAL AGGARWAL (HUP), VINAY K.AGGARWAL ASSESSING OFFICE HAS REPORTED THAT NOTICES HAVE COME BACK AND HENCE COUL D NOT BE VERIFIED. THE APPELLANT HAS REPLIED THAT PAPERS WERE SUBMITTED BU T ASSESSING OFFICER DID NOT ACCEPT IT. THE ASSESSING OFFICER IN THE REMAND REPO RT HAS CLEARLY BROUGHT OUT THAT THE NOTICES HAVE COME BACK THOUGH SERVED ON TH E ADDRESSES GIVEN BY THE APPELLANT ONLY WHILE FURNISHING ADDITIONAL CONFIRMA TION LETTERS AS ADDITIONAL EVIDENCES. THE APPELLANT IS TRYING TO PUT PAPERS NO W SUBSEQUENT TO REMAND AGAIN IN THE CASE OF VIJAYKUMAR M. AGARWAL. VINOD M .AGGARWAL, EAMAL AGGARWAL AND VINAY K.AGGARWAL. KAMAL AGGARWAL AND V INAY K.AGGARWAL. IN VIEW OF THE FACT THAT APPELLANT WAS GIVEN DUE OPPOR TUNITY WHICH HE DID NOT AVAIL I.T.A NO.4305/ MUM/2011 ASSESSMENT YEAR: 2007-08 6 BUT IS NOW SUBMITTING FRESH PAPERS IS OF NO MUCH HE LP TO HIM AND HENCE THEY ARE NOT ADMITTED AND ADDITION FOR THE AMOUNT OF RS.3,00 ,000/- OF VINOD M.AGGARWAL AND RS. 1,00,000/- OF KAMAL AGGARWAL (HUF) ARE SUST AINED. 5.5 A5 A RESULT ADDITION FOR THE TOTAL AMOUNT REFLE CTED IN SCHEDULE III RS. 5.86,27,05O/- AND OF SCHEDULE I FOR RS.26,50,000/- ARE SUSTAINED ASUNDER: UMA RANI GUPTA : RS.5,00,000 MEGHRU SAHHSRWAI : RS.1,70.000 GLIRISH SINGHAL (HUF) : RS.2,00,000 RAKHI AGGARWAL : RS. 70,000 KEWAL KRISHNA GUPTA(HUF) : RS,1,00,000 KEWAL KRISHNA GUPTA : RS.3,00,000 SHRUTI AGGARWAL : RS.20O000 SUNITA AGGARWAL : RS. 50,000 VARSHA AGGARWAL : RS.4O0,000 VINKUMAR M.AGGANVAL - : RS. 50,000 VINOD MAGGARWAL - : RS.3,00000 KAMAL AGGARWAL (HUF) - : RS.1,00,000 VINAY K.AGGARWAL - : RS, 100000 AGGANVAL STEEL ENTERPRISES - : RS.1,10000 TOTAL; RS.26,50,000/- SCHEDULE III MR.ASHOK GORNANI : RS.15,00,000/- M/S.C.K.HUILDERS & DEVELOPERS : RS.S,00,000/- MR.LACHHMIDHAR KANSHIRAM : RS.45,2?,050/- MR. MANAV R. GUPTA : RS1,00,000/- MR.SUNNY MAGHRIANI : RS.20,00,000/- TOTAL RS .86,,27,050 GRAND TOTAL RS.1,12,77,050 3. SO FAR AS THE AMOUNTS IN THIRD LIST WERE CONCERNED, I.E. WITH RESPECT TO ITEMS OF LOANS WHICH WERE SQUARED UP DURING THE YEAR, THE CIT( A) NOTED THAT THE ASSESSEE HAS NOT FILED BALANCE CONFIRMATIONS IN RESPECT OF THE SAM E AND TREATED THE SAME AS BOGUS LOANS. THE CIT(A) FURTHER NOTED THAT THE TOTAL OF T HESE AMOUNTS WORKED OUT TO RS.1,12,77,050 WHEREAS THE ADDITIONS MADE BY THE ASSESSIN G OFFICER WAS ONLY RS.62,19,593. THE DIFFERENCE WAS EXPLAINED TO THE EF FECT THAT WHERE AS THE AO HAD ADDED ONLY THE DIFFERENCE BETWEEN THE CLOSING BALANC E OF LOAN CREDITORS BETWEEN THE LOANS AS AT THE END OF THE RELEVANT PREVIOUS YEAR VIS- -VIS LOANS AS AT THE BEGINNING OF I.T.A NO.4305/ MUM/2011 ASSESSMENT YEAR: 2007-08 7 THE PREVIOUS YEAR, THE CIT(A) HAS ADOPTED THE ENTIRE AMOUNTS OF OUTSTANDING IN RESPECT OF THE BOGUS LOANS WHICH INCLUDE THE AMOUNTS SQU ARED UP DURING THE RELEVANT PREVIOUS. THE CIT(A) NOTED THAT EVEN THOUGH THERE I S ENHANCEMENT IN ADDITION U/S.68 TO THE TUNE OF RS.50,57,475, NO NOTICE FOR ENH ANCEMENT IS REQUIRED AS APPELLANT HAS HIMSELF FURNISHED NAME OF THE PARTIES AND AMOUNT FOR THE SQUARED UP LOANS. IT WAS IN THIS BACKGROUND AND WITHOUT ISSUING AN Y NOTICE FOR ENHANCEMENT, THE CIT(A) CONFIRMED THE ADDITION OF RS.1,12,77,050. THE ASSESSEE IS AGGRIEVED AND IS IN APPEAL BEFORE US. 4. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTUAL MATRIX OF THE CASE AS ALSO THE APPLI CABLE LEGAL POSITION. 5. WE FIND THAT, AS HELD BY HONBLE DELHI HIGH COURT IN THE CASE OF GEDORE TOOLS PVT LTD VS CIT(238 ITR 268), THE POWER OF ENHANCEMEN T BY THE CIT(A) IS SUBJECT TO THE LIMITATION PROVIDED IN SUB-SECTION 2 OF SECTION 2 51 AND SUCH QUESTION COULD BE CONSIDERED ONLY IF NOTICE WAS GIVEN IN THAT REGARD. CLEARLY, IN THE PRESENT CASE, NO SPECIFIC SHOW CAUSE NOTICE WITH RESPECT TO ENHANCEMENT WAS NOT GIVEN BY THE CIT(A). THE MANDATE OF SECTION 251(2) IS QUITE UNAMBIGUOUS AS IT PROVIDES THAT THE CIT(A) SHALL NOT ENHANCE AN ASSESSMENT.. UNLESS THE APPELLANT H AS HAD A REASONABLE OPPORTUNITY OF SHOWING CAUSE AGAINST SUCH ENHANCEMENT O R REDUCTION. IN THIS VIEW OF THE MATTER, LEARNED CIT(A) WAS CLEARLY IN ERROR I N PROCEEDING TO ENHANCE THE ASSESSMENT WITHOUT GIVING ASSESSEE AN OPPORTUNITY OF HEARIN G AGAINST SUCH ENHANCEMENT. WE, THEREFORE, DEEM IT FIT AND PROPER TO VACATE THE IMPUGNED ORDER AND REMIT THE MATTER BACK TO THE FILE OF THE CIT(A) FOR FRESH ADJUDICATION AFTER GIVING A DUE AND FAIR OPPORTUNITY OF HEARING TO THE ASSESSEE ON THE ISSUE OF ENHANCEMENT OF ASSESSMENT, IF AT ALL THE CIT (A) CONSIDERS IT APPROPRIAT E TO ENHANCE THE ASSESSMENT. 6. WE HAVE ALSO NOTICED THAT THE ASSESSEE HAS NOW FILED ADDITIONAL EVIDENCES BY WAY OF CONFIRMATIONS AND OTHER SUPPORTING MATERIAL TO DEMONSTRATE BONAFIDES OF THE CREDITORS. WE HAVE ALSO TAKEN NOTE OF ASSESSEES PLEA THA T AS HE DID NOT HAVE PROPER LEGAL ASSISTANCE AND THAT DUE TO FACTORS BEYOND HIS CONT ROL, HE COULD NOT OBTAIN THESE EVIDENCES EARLIER. IN OUR CONSIDERATION VIEW, THE T ECHNICALITIES OF ASSESSEES FAILURE TO HAVE PRODUCED ALL THESE MATERIALS SHOULD NOT COME IN THE WAY OF SUBSTANTIVE JUSTICE, I.T.A NO.4305/ MUM/2011 ASSESSMENT YEAR: 2007-08 8 AND, NOW THAT THE MATTER IS GOING BACK TO CIT(A) ANY WAY, ALL THESE EVIDENCES SHOULD BE EXAMINED AND CONSIDERED ON MERITS. WE, THEREFORE, DEEM IT FIT AND PROPER TO ALSO DIRECT THE CIT(A) TO TAKE ALL INTO ACCOUNT SUCH ADDI TIONAL EVIDENCES, AS THE ASSESSEE MAY PRODUCE EVEN AT THIS STAGE, AND DECIDE THE MATTER ON THE MERITS OF THESE EVIDENCES AND ALL OTHER FACTORS. ACCORDINGLY, WE DIR ECT THE CIT(A) TO DECIDE THE MATTER DENOVO IN THE LIGHT OF OUR ABOVE OBSERVATIONS. 7. FOR THE REASONS SET OUT ABOVE, AND IN THE LIGHT OF DIRECTIONS AS ABOVE, WE HEREBY REMIT THE MATTER TO THE FILE OF THE CIT(A) F OR ADJUDICATION DENOVO. AS WE ARE REMITTING THE MATTER BACK TO THE FILE OF THE CIT(A ) FOR THE PURPOSE OF EXAMINING ADDITIONAL EVIDENCES AND FOR HEARING ASSESSEE ON THE QUE STION OF ENHANCEMENT OF ASSESSMENT, IF NEEDED, WE SEE NO NEED TO ADJUDICATE THE MATTER ON MERITS. IT IS, HWOEVER, OPEN TO THE ASSESSEE TO TAKE UP THESE ISSUES AT T HE APPROPRIATE STAGE. 8. IN THE RESULT, APPEAL IS ALLOWED FOR STATISTICAL PURPOSES IN THE TERMS INDICATED ABOVE. PRONOUNCED IN THE OPEN COURT ON 21 ST OCTOBER, 2011 SD/- (ASHA VIJAYARAGHAVAN) JUDICIAL MEMBER SD/- (PRAMOD KUMAR) ACCOUNTANT MEMBER MUMBAI, DATED 21 ST OCTOBER, 2011 PARIDA COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER OF INCOME TAX (APPEALS)33,, MUMBAI 4. COMMISSIONER OF INCOME TAX, 22 , MUMBAI 5. DEPARTMENTAL REPRESENTATIVE, BENCH A MUMBAI //TRUE COPY// BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI