MOIN YUSUF KHAN, MUMBAI V. ITO 17(2)(3), MUMBAI

ITA 4328/MUM/2018

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 1818 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 11 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-06-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 28-06-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SMITA VERMA
• Keywords: Reopening of assessment; Sale consideration of property below Jantri Value; Depreciation; Opportunity of being heard; Set aside
• Section: 147; 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC - I , MUMBAI BEFORE SHRI SAKTIJIT DEY (JM) ITA NO. 4328/MUM/2018 ASSESSMENT Y EAR: 2008 - 09 MOIN YUSUF KHAN, ROOM NO. 40, 3 RD FLOOR, 37, KARIM MISTRY BUILDING, TANTAPURA STREET, MASJID BUNDER, MUMBAI - 400009 PAN: AGCPK6924H VS. INCOME TAX OFFICER 17 (2)(3), ROOM NO. 123B/G, 1 ST FLOOR, AAYAKAR BHAVAN, M.K. MARG, MUMBAI - 400020 (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI JAYANT BHATT ( AR) REVENUE BY : SMITA VERMA (DR) DATE OF HEARING: 16 /06 /20 21 DATE OF PRONOUNCEMENT: 25 / 06 /202 1 O R D E R THIS IS AN APPEAL BY THE ASSESSEE AGAINST ORDER DATED 01.03.2018 OF L EARNED COMMISS IONER OF INCOME T AX (APPEALS) 8 8 , MUMBAI FOR THE ASSESSMENT YEAR 2008 - 09 . 2. GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER: - 1) UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT (A) HAS ERRED IN CONFIRMING THE ACTION OF THE AO FOR REOPENING OF ASSESSMENT U/S 147 AND THE SAME BEING BAD IN LAW THE ASS ESSMENT ORDER PASSED IN CONSEQUENCE TO SUCH REOPENING BEING ALSO BAD IN LAW THE ASSESSMENT SHOULD BE ANNULLED. 2) UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE BY THE AO WITH 2 ITA NO. 4328 / MUM/2019 ASSESSMENT YEAR: 2008 - 09 REGARDS T O DISALLOWANCE OF DEPRECIATION IN ALL AMOUNTING 3,63,388/ - AND THE SAME BE DELETED AND DEPRECIATION SHOULD BE ALLOWED IN FULL. 3) UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD - CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 12,00 ,000/ - MADE BY THE AO ON ACCOUNT OF STAMP DUTY VALUATION AT PS . 12,00,000/ - AS AGAINST ACTUAL PAYMENT OF BS. 11,00,000/ - RECEIVED BY THE APPELLANT. 4) UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW , THE LD. CIT (A) HAS ERRED IN CONFIRMING AN A DDITION OF RS. 7,62,250/ - BEING ADVANCES GIVEN BY THE APPELLANT TO TWO PARTIES WITHOUT APPRECIATING THE FACT THAT THE SAME WERE ALREADY SHOWN IN THE BALANCE SHEET UNDER THE BROAD HEAD SUNDRY CREDITORS AS AGAINST UNDER THE BROAD HEAD LOANS AND ADVANCES. THUS ADDITION MADE IS WITHOUT APPRECIATING THE FACTS ON RECORD SHOULD BE DELETED. 5) UNDER TH E FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF 1,36,385/ - BEING DIFFERENCE IN TOTAL AMOUNT OF SUNDRY CREDITO RS AS PER BALANCE SHEET AND DETAILS AVAILABLE ON RECORD WITHOUT APPRECIATING THE FACTS THAT THERE WAS NO SUCH DIFFERENCE IN TOTAL SUNDRY CREDITORS AS ENVISAGED AND HENCE ADDITION MADE SHOULD BE DELETED. 3. AT THE OUTSET, THE LEARNED AUTHORISED REPRESENTAT IVE OF THE ASSESSEE , ON INSTRUCTIONS , DID NOT PRESS GROUND NO. 1. ACCORDINGLY, GROUND NO. 1 IS DISMISSED AS NOT PRESSED. IN GROUND NO. 2 TO 4, THE ASSESSEE HAS CHALLENGED VARIOUS ADDITIONS/DISALLOWANCES MADE BY THE ASSESSING OFFICER (AO) AN D CONFIRMED BY L EARNED COMMISSIONER (APPEALS). 4. BRIEFLY THE FACTS ARE THE ASSESSEE IS AN INDIVIDU AL ENGAGED IN THE BUSINESS OF L ORRY HIRE FOR REMOVAL REFUG ES. FOR THE ASSESSMENT YEAR UNDER DISPUTE, THE ASSESSEE HAD FILED HIS RETURN OF INCOME DECLARING T OTAL INCOME OF R S. 4,05,950/. 3 ITA NO. 4328 / MUM/2019 ASSESSMENT YEAR: 2008 - 09 ASSESSMENT IN CASE O F THE ASSESSEE WAS COMPLETED UNDER SECTION 143 (3) OF THE ACT VIDE ORDER DATED 20.12.2010 DETERMINING THE TOTAL INCOME AT RS. 5,93,450/. SUBSEQUENTLY, THE ASSESSING OFFICER (AO) WHILE VERIFYING THE PROFIT AND LOSS ACCOUNT A ND OTHER MATERIALS ON RECORD HAVING FOUND THAT THE ASSESSEE HAS CLAIMED EXCESS DEPRECIATION , REOPEN ED THE ASSESSMENT UNDER SECTION 147 OF THE ACT . A S ALLEGED BY THE AO, IN RESPONSE TO NOTICE ISSUED UNDER SECTION 148 AS WELL AS UNDER SECTION 142 (1) OF THE A CT, THE ASSESSEE DID NOT APPEAR IN SPITE OF SEVERAL OPPORTUNITIES BEING GRANTED. THEREFORE, THE AO PROCEEDED TO COMPLETE THE ASSESSMENT TO THE BEST OF HIS JUDGMEN T BY INVOKING THE PROVISIONS OF SECTION 144 OF THE ACT. WHILE DOING SO, HE MADE THE FOLLOWING ADDITIONS. DISALLOWANCE OF DEPRECIATION : RS. 3,63,388/ - ADDITION OF SHORT TERM CAPITAL GAIN U/S 50C: RS 1,00,000/ - ADVANCE GIVEN TO PARTIES : RS. 7,62,250/ - DIFFERENCE IN SUNDRY CREDITORS : RS. 1,36,835/ - 5. AGAINST THE ASSESSMENT ORDER SO P ASSED , ASSESSEE PREFERRED APPEAL BEFORE LEARNED COMM ISSIONER (APPEALS). HOWEVER, LEARNED COMMISSIONER (APPEALS) ALSO SUSTAINED THE ADDITIONS MADE BY THE AO. 6. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE BASIC GRIEVANC E OF THE ASSESSEE , AS ARTICU LATED BY THE LEARNED AUTHORISED REPRESENTATIVE OF THE ASSESSEE IS , BOTH THE AO AND LEARNED COMMISSIONER (APPEALS) HAVE NEITHER GIVEN PROPER OPPORTUNITY TO THE ASSESSEE TO EXPLAIN THE DOUBT S ENTERTAIN ED BY THEM NOR THE SUBMISSION S MADE AND DOCUMENTS FILED HAVE BEEN PROPERLY VERIFIED. HE SUBMITTED , THOUGH , BEFORE LEARNED COMMISSIONER (APPEALS), THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE APPEARED FROM TIME TO TIME AND FURNISHED VARIOUS EVIDENCE S IN SUPPORT OF ASSESSEES CLAIM, H O WEVER, NEITHER THE PRESENCE OF THE AUTHORIZED REPRESENTATIVE HAS BEEN MARKE D NOR THE EVIDENCES FURNISHED PROPERLY EVALUATED. THUS, HE HAS SUBMITTED , THE ISSUES RELATING TO THE VARIOUS ADDITIONS MADE SHOULD BE RESTORED BACK TO THE AO FOR FRESH ADJUDICATION. HAVING 4 ITA NO. 4328 / MUM/2019 ASSESSMENT YEAR: 2008 - 09 CONSIDERED THE SUBMISSIONS OF THE PARTIES, I FIND THAT THE AO HAS COMPL ETED THE ASSESSMENT EX - PARTE UNDER SECTION 144 OF THE ACT. THUS, IT IS EVIDENT , FOR WHATEVER MAY BE THE REASON , THE ASSESSEE COULD NOT APPEAR BEFORE THE AO AND EXPLAIN ON VARIOU S ISSUES. IT APPEARS FROM RECORD, DUE TO ABSENCE OF THE ASSESSEE AND NON FURNISHING OF EVIDENCE S , THE AO HAS MADE THE ADDITIONS MOSTLY ON PRE SUMPTION AND ESTIMATE BASIS. INSO FAR AS THE PROCEEDINGS BEFORE LEARNED FIRST APPELLATE AUTHORITY IS CONCERNED, IT A PPEAR S FROM THE IMPUGNED ORDER OF LEARNED COMMISSIONER (APPEALS), THE PRESENCE OF THE AUTHORIZED REPRESENTATIVE HAS NOT BEEN MARKED. FURTHER, THOUGH, LEARNED COMMISSIONER (APPEALS) HAS REFERRED TO A WRITTEN SUBMISSIONS FILED ON BEHALF OF THE ASSESSEE, H OWE VER, HE HAS NOT DEALT WITH TH E SUBMISSIONS OF THE ASSESSEE WITH PROPER REASONING. IT IS EVIDENT , LEARNED COMMISSIONER (APPEALS) HAS PRIMARILY RELIED UPON THE OBSERVATIONS OF THE AO AND HAS SUSTAINED THE ADDITIONS BY ALLEG ING THAT THE ASSESSEE HAS FAILED TO FURNISH ADEQUATE EVIDENCE. CONSIDERING THE OVER ALL FACTS AND CIRCUMSTANCES OF THE CASE I AM OF THE VIEW THAT THE ISSUE S RAISED IN RELATION TO VARIOUS ADDITIONS MADE BY THE AO AND SUSTAINED BY LEARNED COMMISSIONER (APPEALS) REQUIRES FRESH CONSIDERATION. AC CORDINGLY, I SET ASIDE THE IMPUG NED ORDER OF LEARNED COMMISSIONER (APPEALS) AND RESTORED THE ISSUES RAISED IN GROUND NO. 2 TO 5 TO THE AO FOR AFRESH ADJUDICATION AFTER DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 7 . IN THE RESULT, APPEAL IS PARTLY ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 25 TH JUNE , 2021 . SD/ - ( SAKTIJIT DEY ) JUDICIAL MEMBER MUMBAI ; DATED: 25 / 06 /202 1 ALINDRA, PS 5 ITA NO. 4328 / MUM/2019 ASSESSMENT YEAR: 2008 - 09 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI