DCIT CEN CIR 18 &19, MUMBAI V. NARESH B. VORA, MUMBAI

ITA 4430/MUM/2013

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 9840 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 9 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-03-2018
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 1997-1998
• Appeal Filed On: 03-06-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: T A KHAN
• Keywords: Revised return
• Section: 143(3); 133A

Judgement Text

IN THE INC OME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE SHRI G. S. PANNU , AM & SH. SANDEEP GOSAIN, JM ./ I.T.A. NO . 4430/MUM/2013 ( / ASSESSMENT YEAR: 1997 - 98 ) DCIT CEN CIR 18 7 19 ROOM NO. 401 , 4 TH FLOOR , AAYAKAR BHAVAN , M. K. ROAD, MUMBAI - 4000 20 / VS. SHRI NARESH B. VORA, 16/2, PARAS, GULMOHAR CROSS ROAD NO. 4, JVPD SCHEME, VILE PARLE (W), MUMBAI - 400049 ./ ./ PAN NO. AABPV0742K ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI T. A. KHAN, DR / RESPONDENTBY : NONE / DATE OF HEARING : 2 7 /02 /201 8 / DATE OF PRONOUNCEMENT : 19/03/2018 / O R D E R PER SANDEEP GOSAIN, J UDICIAL MEMBER : THE P RESENT APPE AL FILED BY THE REVENUE IS AGAINST THE ORDER OF LD. CI T (APPEAL) 39 , MUMBAI DATED 07.03.13 F OR AY 1997 - 98 ON THE GROUNDS MENTIONED HEREIN BELOW: - 2 I.T.A. NO. 4430 /MUM/201 3 SHRI NARESH B. VORA 1. 'ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE ADDITION OF RS.21,68,000, RS.10,49,000/ - , 96,70,350/ - AND 76,14,644/ - MADE BY THE AO ON ACCOUNT OF UNDISCLOSED PAYMENTS AND RECEIPTS FROM THE NAPTHA QUOTA HOLDE R, WITHOUT APPRECIATING THE FACTS OF THE CASE. 1(I) THAT IN DOING SO THE LD.CIT(A) DID NOT APPRECIATE THE FACT THAT THE ASSESS E E FAILED TO REBUT THE PRESUMPTION BEFORE THE AO, THAT THE SAID AMOUNTS COMPRISED HIS INCOME, AND THAT THERE WAS NO EVIDENCE ON RE CORD TO HOLD OTHERWISE. 1(II) THAT IN DOING SO THE LD. CIT(A) IGNORED THAT FACT THAT PAGE NO. 48 OF THE SEIZED PAPER SPECIFICALLY MENTIONED THE WORDS 'SALES' AND 'CLOSING STOCK' WHICH CLEARLY INDICATES INVOLVEMENT OF THE ASSESSEE IN CLANDESTINE TRADING IN NAPTHA APART FROM COMMISSION EARNED FROM ISSUING BOGUS BILLS.'. 2. THE APPELLANT CRAVES TO LEAVE TO ADD, TO AMEND AND / OR TO ALTER ANY OF THE GROUNDS OF APPEAL, IF NEED BE. 3. THE APPELLANT, THEREFORE, PRAYS THAT ON THE GROUNDS STATED ABOVE, THE ORDER OF THE CIT(A) - 39, MUMBAI MAY BE SET ASIDE AND THAT OF THE ASSESSING OFFICER RESTORED. 3 I.T.A. NO. 4430 /MUM/201 3 SHRI NARESH B. VORA 2. AT THE VERY OUTSET, IT IS NOTICED THAT NONE HAS APPEARED ON BEHALF OF ASSESSEE /RESPONDENT IN SPITE OF SEVERAL CALLS AND EVEN NO APPLICATION FOR ADJOURNMENT WAS MOVED. ON THE OTHER HAND, LD. DR PRESENT IN THE COURT IS READY WITH ARGUMENTS. THEREFORE WE HAVE DECIDED TO PROCEED WITH THE HEARING OF THE CASE EX - PA RTE WITH THE ASSISTANCE OF THE L D. DR AND THE MATERIAL PLACED ON RECORD. 3. THE B RIEF FACTS OF THE CASE AS RECORDED BY AO ARE THAT THE ASSESSEE FI LED ITS RETURN OF INCOME ON 3 1.10.1997 ADMITTING TAXABLE INCOME OF RS. 78,804/ - . A REVISED RETURN OF INCOME WAS FILED ON 31.10.1997 DISCLOSING INCOME OF RS. 10,62,340/ - WHEREIN THE ASSESSEE WITHDREW THE DEDUCTION U/S 80 - IA CLAIMED IN THE ORIGINAL RETURN OF INCOME. SUBSEQUENT A SURVEY U/S 133A WAS CONDUCTED ON 24.09.98. THE ORIGINAL ASSESSMENT WAS COMPLETED AFTER CONSIDERING THE MATERIALS FOUND DURING THE SURVEY, DETERMINING THE TAXABLE INCOME AT RS. 17,30,00,600/ - . THE ASSESSEE FILED APPEAL AGAINST THE ORDER OF AO AND THAT APPEAL WAS PA RTLY ALLOWED BY LD. CIT(A) VIDE ORDER DATED 17.05.02. 4 I.T.A. NO. 4430 /MUM/201 3 SHRI NARESH B. VORA AGGRIEVED BY THE ORDER OF LD. CIT(A), BOTH ASSESSEE AS WELL AS REVENUE FILED THEIR RESPECTIVE APPEALS BEFORE THE HONBLE TRIBU NAL AND THE TRIBUNAL VIDE COMMON ORDER DATED 29.11.07 IN ITA NO. 4043/MUM/2002, SET ASIDE THE ASSESSMENT FOR FRESH CONSIDERATION BY THE AO. THEREAFTER D URING THE SECOND ROUND OF ASSESSMENT PROCEEDINGS, THE AO OBSERVED THAT ASSESSEE HAS ACCEPTED CASH ALON GWITH FABRICATED TRANSPORT BILLS FROM THE NAPHTHA DEALERS AND DEPOSITED THE CASH IN THE BANK ACCOUNTS MAINTAINED BY HIM AND HAD ISSUED DEMAND DRAFT/PAY ORDERS TO THE NAPHTHA DEALERS. ON THE BASIS OF INVESTIGATIONS CARRIED OUT BY THE AO AND THE CONSIDERING THE DOCUMENTS, AO FRAMED THE ORDER OF ASSESSMENT U/S 143(3) R.W.S 254 OF THE I.T. ACT ON 17.11.08 THEREBY MAKING ADDITIONS/DISALLOWANCE UNDER DIFFERENT HEAD AS DETAILS IN PARA NO. 4.2 OF CIT(A)S ORDER. AGGRIEVED BY THE ORDER OF AO, ASSESSEE PREFERRED APPE AL BEFORE LD. CIT(A) AND LD. CIT(A) AFTER CONSIDERING THE CASE OF BOTH THE PARTIES PARTLY ALLOWED THE APPEAL OF THE ASSESSEE. 5 I.T.A. NO. 4430 /MUM/201 3 SHRI NARESH B. VORA NOW BEFORE US, THE REVENUE HAS PREFERRED THE PRESENT APPEAL BY RAISING THE ABOVE GROUNDS. GROUND NO. 1 (I) & (II) 4 . THESE GROUND S RAISED BY THE REVENUE ARE INTER - CONNECTED AND INTER - RELATED AND RELATES TO CHA LLENGING THE ORDER OF LD. CIT(A) IN DELETING THE ADDITION OF RS.21,68,000, RS.10,49,000/ - , 96,70,350/ - AND 76,14,644/ - MADE BY THE AO ON ACCOUNT OF UNDISCLOSED PAYMENTS A ND RECEIPTS FROM THE NAPTHA QUOTA HOLDER, WITHOUT APPRECIATING THE FACTS OF THE CASE. LD. DR SUBMITTED BEFORE US THAT LD.CIT(A) WHILE DECIDING THIS GROUND HAD NOT APPRECIATE D THE FACT THAT THE ASSESSEE FAILED TO REBUT THE PRESUMPTI ON BEFORE THE AO, THAT T HE ABOVE AMOUNTS COMPRISED HIS INCOME, AND THAT THERE WAS NO EVIDE NCE ON RECORD TO HOLD. LD. DR FURTHER SUBMITTED THAT WHILE DECIDING THESE GROUNDS, LD. CIT(A) IGNORED THE FACT THAT PAGE NO. 48 OF THE SEIZED PAPER SPECIFICALLY MENTIONED THE WORDS 'SALES' AND 'CLOSING STOCK' WHICH CLEARLY INDICATES INVOLVEMENT OF THE ASSESSEE IN CLANDESTINE TRADING IN NAPTHA APART FROM COMMISSION EA RNED FROM ISSUING BOGUS BILLS . 6 I.T.A. NO. 4430 /MUM/201 3 SHRI NARESH B. VORA 5 . WE HAVE H EARD LD. DR AND WE HAVE ALSO PERUSED THE MATERIAL PLACED ON RECORD AS WELL AS THE ORDERS PASSED BY REVENUE AUTHORITIES. W E FIND THAT AO HAS SPECIFICALLY RECORDED A FINDING IN THE ORDER OF ASSESSMENT THAT THE ASSESSEE HAD NOT LED ANY EVIDENCE TO PROVE THAT THE AMOUNT OF CASH WAS RECEIVED FROM M/S SEVEN PETROLEUM COMPANY. IT WAS RATHER MENTIONED BY THE AO THAT THE SOURCE OF PAYMENT MADE BY THE ASSESSEE TO M/S SEVEN PETROLEUM COMPANY REMAINED UNEXPLAINED AND HENCE ADDITION WERE MADE. IN APPEAL, THE LD. CIT(A ) RECORDED A FINDING THAT THE AMOUNT IN QUESTION WAS RECEIVED BY THE ASSESSEE FROM M/S SEVEN PETROLEUM COMPANY, A NAPTHA QUOTA HOLDER. THE LD. CIT(A) BASED HIS FINDING ON A CHART SUBMITTED BY THE ASSESSEE. ON CAREFUL PERUSAL OF THE DOCUMENTS PLACED ON RE CORD AS WELL AS ORDERS PASSED BY REVENUE AUTHORITIES, WE NOTICE THAT THE ASSESSEE HAD NOT LED ANY INDEPENDENT EVIDENCE TO CORROBORATE OR PROVE THE GENUINENESS OF THE FIGURES CONTAINED IN THE SAID CHART. THEREFORE, IN SUCH CIRCUMSTANCES, THERE IS NO PRESUMP TION OF CORRECTNESS, GENUINENESS OR AUTHENTICITY OF THE FIGURES CONTAINED IN THE CHART. WHEREAS AT PAGE NO. 48 OF THE SEIZED PAPERS, IT IS 7 I.T.A. NO. 4430 /MUM/201 3 SHRI NARESH B. VORA SPECIFICALLY MENTIONED THE WORD 'SALES' AN D 'CLOSING STOCK' WHICH INDICATES INVOLVEMENT OF THE ASSESSEE IN CLANDESTIN E TRADING IN NAPTHA . THEREFORE, WE ARE OF THE CONSIDERED VIEW THAT THE FINDINGS RECORDED BY LD. CIT(A) ARE NOT BASED ON ANY INDEPENDENT DOCUMENTS AND THUS THE SAME ARE SET ASIDE AND THE ADDITIONS MADE BY THE AO ARE RESTORED BACK TO THE FILE OF AO WITH DIRE CTION TO PASS AFRESH ORDER. RESULTANTLY, THESE GROUNDS ARE ALLOWED. GROUND NO. 2 & 3 6. THESE GROUNDS ARE GENERAL IN NATURE, THUS REQUIRES NO SPECIFIC ADJUDICATION. 7 . IN THE NET RESU LT, THE APPEAL FILED BY THE REVENUE STANDS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 19 TH MARCH 2018 SD/ - SD/ - (G. S. PANNU) (SANDEEP GOSAIN) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI ; DATED : 19 . 03 .201 8 SR.PS. DHANANJAY 8 I.T.A. NO. 4430 /MUM/201 3 SHRI NARESH B. VORA / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT - CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE / BY ORDER, . / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI