MILAN RAMNIKLAL PAREKH, MUMBAI V. ACIT 12(1), MUMBAI

ITA 4448/MUM/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 1430 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 9 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-04-2017
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 1992-1993
• Appeal Filed On: 26-06-2014
• Court: TRIBUNAL
• Department Lawyers: SUMAN KUMARDR
• Keywords: Unexplained cash credit; Opportunity of being heard; Corroborative evidences; Onus to prove
• Section: 143(3)

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES B, MUMBAI , , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ITA NO.4448/MUM/2014 ASSESSMENT YEARS: 1992-93 MILAN RAMNIKLAL PAREKH, 31, 4 TH FLOOR, RAJGIR CHAMBERS, 11/14, S.B. SINGH ROAD, FORT, MUMBAI-400001 / VS. ACIT - 12(1), MUMBAI ( ! /ASSESSEE) ( & / REVENUE) PA NO.:-AABFM2799M ! / ASSESSEE BY SHRI RAHUL HAKANI & / REVENUE BY SHRI SUMAN KUMAR-DR ' &( ) ! * / DATE OF HEARING : 06/04/2017 ) ! * / DATE OF ORDER: 12/04/2017 ITA NO.4448/MUM/2014 MILAN RAMNIKLAL PAREKH 2 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER DA TED 04/03/2014 OF THE LD. FIRST APPELLATE AUTHORITY, MU MBAI. THE ONLY GROUND RAISED BY THE ASSESSEE PERTAINS TO CONFIRMING THE ADDITION OF RS.4,15,000/-, CLAIMED T O BE OPENING BALANCE, PURPORTED TO BE UNEXPLAINED CREDIT IN THE NAME OF M/S JADE INVESTMENT AND LEASING PVT. LTD. O N THE GROUND THAT NO SUPPORTING EVIDENCE WAS FURNISHED BY THE ASSESSEE IGNORING THE DIRECTION OF THE TRIBUNAL IN ITS ORDER DATED 11/12/2008, MORE SPECIFICALLY, WHEN THE TRIBU NAL DID NOT DISPUTE THE BOOKS OF ACCOUNTS WERE DESTROYED IN FLOOD AND PERMITTING THE ASSESSEE TO FILE AUDITED BALANCE - SHEET/PROFIT & LOSS ACCOUNT, OBTAINED BY THE ASSESS EE FROM THE AUDITOR TO SUBSTANTIATE ITS CLAIM. 2. DURING HEARING, SHRI RAHUL HAKANI, LD. COUNSEL FOR THE ASSESSEE, ADVANCED ARGUMENTS, WHICH IS IDEN TICAL TO THE GROUND RAISED BY INVITING OUR ATTENTION TO VARI OUS PAGES OF THE PAPER BOOK. IT WAS PLEADED THAT PURSUANT TO THE DIRECTION OF THE TRIBUNAL, THE NECESSARY DOCUMENTS WERE DULY PLACED BEFORE THE ASSESSING OFFICER, WHICH WER E IGNORED BY HIM. OUR ATTENTION WAS FURTHER INVITED TO PAGE-2 8, 30 AND 36 OF THE PAPER BOOK ALONG WITH PARA 2.6 OF THE IMPUGNED ORDER. ON THE OTHER HAND, THE LD. DR, SHRI SUMAN KUMAR, DEFENDED THE ADDITION AND THE CONCLUSION DRA WN IN THE IMPUGNED ORDER. ITA NO.4448/MUM/2014 MILAN RAMNIKLAL PAREKH 3 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT THE ASSESSMENT ORDER U/S 143(3) AND R.W.S 254 OF THE ACT WAS PASSED ON 10/02/2006 BY THE ASSESSING O FFICER, DETERMINING TOTAL INCOME AT RS.23,16,050/-. WHILE D OING SO, AN AMOUNT OF RS.4,15,000/- WAS ADDED AS THE LD. ASS ESSING OFFICER WAS OF THE VIEW THAT THE DEBIT AMOUNT OF RS.4,15,000/- IN THE NAME OF M/S JADE INVESTMENT AN D LEASING PVT. LTD. COULD NOT BE EXPLAINED WITH THE H ELP OF SUPPORTING EVIDENCE. IT IS NOTED THAT ON EARLIER OC CASION, THE MATTER TRAVELLED UP TO THE TRIBUNAL, WHEREIN, VIDE ORDER DATED 11/12/2008 (ITA NO.1955/MUM/2007) FOLLOWING ORDER WAS PASSED:- THIS APPEAL BY THE ASSESSEE FOR THE ASSESSMENT YEA R 1992-93 IS DIRECTED AGAINST THE ORDER OF CIT(A). THE ONLY GROU ND OF APPEAL OF THE ASSESSEE IS AS UNDER:- '1. LD. CIT(A) ERRED IN CONFIRMING AN ADDITION OF RS.41 5, 000 MADE IN RESPECT OF THE AMOUNT RECEIVED FROM JADE INVESTMENT & LEASING PVT. LTD WITHOUT QUITE APPRECIATING THAT THAT THE SAID AMOUN T WAS RECEIVED IN AN EARLIER YEAR AND WITHOUT PROPERLY APPRECIATING THE FACTS AND CIRCUMSTANCES OF CASE.' 2. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE IS IN THE SECOND INNINGS BEFORE THE TRIBUNAL. HE SUBM ITTED THAT IN THE FIRST INNINGS, THE ISSUE OF ADDITION OF RS.4.15 LAKHS WAS SET ASIDE BY THE TRIBUNAL TO THE FILE OF THE ASSESSING OFFICER FOR F RESH DECISION AFTER ALLOWING AN OPPORTUNITY OF BEING HEARD TO THE ASSES SEE, IN ITA NO.4936/M/95 DT.24.3.04. THE LD. COUNSEL FOR THE AS SESSEE SUBMITTED THAT THEREAFTER IN JULY, 05 THERE WERE UN-PRECEDENT ED FLOODS IN MUMBAI AND THE ENTIRE RECORD OF THE ASSESSEE WAS LOST IN T HE FLOODS AND THEREFORE, THE ASSESSEE COULD NOT PRODUCE THE REQUISITE EVIDEN CE BEFORE THE ASSESSING OFFICER AT THE TIME OF FRESH ASSESSMENT B EING FRAMED IN ACCORDANCE WITH DIRECTIONS OF THE TRIBUNAL. HOWEVER , THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT WITH MUCH EFFORTS, THE ASSESSEE WAS ABLE TO GET THE AUDIT REPORT AND OTHER EVIDENCE FROM ITS FI RST AUDITOR IN ORDER TO ITA NO.4448/MUM/2014 MILAN RAMNIKLAL PAREKH 4 PROVE THE GENUINENESS OF THE ENTRY OF RS.4,15,000/- RELATING TO M/S.JADE INVESTMENT AND LEASING PVT. LTD. LEARNED COUNSEL FO R THE ASSESSEE REQUESTED THAT THE ASSESSEE MAY BE ALLOWED ONE MORE CHANCE TO LEAD ITS EVIDENCE BEFORE THE CIT(A). LD. DR HAS OPPOSED THE SUBMISSIONS OF THE LEARNED COUNSEL FOR THE .ASSESSEE. HE SUBMITTED THA T THE ASSESSMENT WAS SET .ASIDE BY THE ORDER OF THE TRIBUNAL ON 24.0 3.04 AND THE FLOOD WATERS CAME IN THE MONTH OF JULY 05 AND THEREFORE, THE ASSESSEE WAS HAVING MORE THAN A YEAR ITS DISPOSAL TO FILE THE N ECESSARY EVIDENCE BEFORE THE ASSESSING OFFICER AND THEREFORE, THERE I S NO JUSTIFICATION FOR ALLOWING ONE MORE CHANCE TO TILE ASSESSEE. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFUL LY. WE FIND THAT IN PURSUANCE OF SETTING ASIDE THE ORDER PASSED BY T HE TRIBUNAL ON 24.03.04, THE ASSESSMENT PROCEEDINGS WERE COMMENCED BY THE AO BY ISSUING NOTICE U/S.143(2) OF THE ACT TO THE ASSESSE E ON 17.01.06 AND THEREFORE, IT CANNOT BE SAID THAT THE ASSESSEE COUL D HAVE FILED THE' NECESSARY EVIDENCE BEFORE THE ASSESSING OFFICER PRI OR TO THE FLOOD WATERS DESTROYING ITS RECORDS IN JULY 05. THE ASSESSEE HAS CLAIMED BEFORE US THA1 IT HAS ACQUIRED THE REQUISITE EVIDENCE BEFORE THE ITS FIRST AUDITOR AND IS 11 A POSITION TO PRODUCE THE SAME BEFORE THE REV ENUE AUTHORITIES WHILE IT IS WELL SETTLED THAT THE ONUS TO PROVE THE GENUI NENESS OF THE ENTRIES IN THE ACCOUNT BOOKS OF THE ASSESSEE IS CLEARLY ON THE ASSESSEE, WE FIND THAT IN THE PECULIAR FACTS OF THE CASE IT SHALL BE IN THE INTEREST OF THE JUSTICE TO ALLOW THE ASSESSEE ONE MORE CHANCE TO LEAD EVID ENCE IN SUPPORT OF ITS CASE BEFORE THE-REVENUE AUTHORITIES. ACCORDINGLY, T HE ORDER OF THE CIT(A) IS SET ASIDE TO ITS FILE V.ITH DIRECTION TO PASS A DENOVO APPELLATE ORDER IN ACCORDANCE WITH LAW AFTER PROVIDING REASONABLE OPPO RTUNITY OF HEARING TO THE PARTIES. THE ASSESSEE SHALL BE AT LIBERTY TO LE AD THE EVIDENCE IN SUPPORT OF ITS CASE REGARDING THE GENUINENESS OF TH E ENTRY WITH REGARD TO M/S JADE INVESTMENT AND LEASING PVT. LTD. WE DIRECT ACCORDING. 4. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSE ONLY. 2.2. PURSUANT TO THIS DIRECTION OF THE TRIBUNAL, T HE ASSESSEE APPROACHED THE OFFICE OF THE ASSESSING OFF ICER, HOWEVER, THE EXPLANATION OF THE ASSESSEE WAS REJECT ED. IT IS ALSO NOTED THAT IDENTICAL PLEA WAS RAISED BY THE AS SESSEE BEFORE THE LD. COMMISSIONER OF INCOME TAX (APPEAL), WHEREIN, IN PARA-2.6 OF THE IMPUGNED ORDER, IT WAS NOTED THAT THERE WERE SERIES OF ENTRIES IN THE BOOKS OF T HE ASSESSEE ITA NO.4448/MUM/2014 MILAN RAMNIKLAL PAREKH 5 BY WAY OF TRANSFERRING VARIOUS CREDITS THROUGH GENE RAL ENTRIES. THE AMOUNT OF RS.4,15,000/- FROM M/S JADE INVESTMENT AND LEASING PVT. LTD. WAS CONSIDERED AS UNEXPLAINED CREDIT. THE WHOLE ADDITION IS ON THE PR EMISE THAT THE ASSESSEE COULD NOT FILE CONFIRMATION FROM M/S JADE INVESTMENT AND LEASING PVT. LTD. HOWEVER, FROM PAGE -36 OF THE PAPER BOOK IN PARA 4(C) OF THE ASSESSMENT ORDER DATED 14/03/1995, THERE IS SPECIFIC MENTION THAT THIS IS A CREDIT FROM THE SAID PARTY I.E. M/S JADE INVESTMENT AND LE ASING PVT. LTD. WE HAVE ALSO PERUSED THE RECORD AND FIND THAT THE ASSESSEE PRODUCED THE BOOKS OF ACCOUNTS/AUDITED ACC OUNT BEFORE THE ASSESSING OFFICER TO EXPLAIN THE AMOUNT. IT IS EVIDENTLY CLEAR (PAGE-5 OF THE PAPER BOOK) THAT THE IMPUGNED AMOUNT IS OPENING BALANCE AND EVEN BEFORE THE TRIBU NAL, THE LD. DR (ITA NO.4936/MUM/1996) HAS CLEARLY ADMI TTED (PARA-4) THAT EVEN THE CIT(A) ACCEPTED THE EXPLANAT ION OF THE ASSESSEE THAT THIS ENTRY WAS ON THE BASIS OF EVIDEN CE AT THAT TIME AND DIRECTED THE ASSESSING OFFICER TO DELETE T HE ADDITION MADE IN THE ORIGINAL ASSESSMENT ORDER, MEANING THER EBY, THE EVIDENCE WAS AVAILABLE DURING ORIGINAL ASSESSMENT PROCEEDINGS, WHICH CLEARLY PROVES THAT THE AMOUNT O F RS.4,15,000/- WAS IN THE NAME OF M/S JADE INVESTMEN T AND LEASING PVT. LTD. THE ASSESSEE HAS DULY EXPLAINED THAT THE OPENING ENTRY TO THE CREDIT OF M/S JADE INVESTMENT AND LEASING PVT. LTD. IS ONLY CARRIED FORWARD BALANCE A S ON 31/03/1991, WHICH IS FORTIFIED BY THE COPY OF THE A UDITED BALANCE SHEET OF THE ACCOUNTS OF THE ASSESSEE, THUS , THE ITA NO.4448/MUM/2014 MILAN RAMNIKLAL PAREKH 6 OPENING BALANCE CANNOT BE TREATED AS UNDISCLOSED IN COME. THE RATIO LAID DOWN IN CIT VS V.P. SINGH 357 ITR 68 1 (P & H) SUPPORTS OUR VIEW, THUS, THIS GROUND OF THE ASSESSE E, IS ALLOWED. FINALLY, THE APPEAL OF THE ASSESSEE IS ALLOWED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 06/04/2017. SD/- SD/- ( RAMIT KOCHAR ) (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER ' ( MUMBAI; + DATED :12/04/2017 F{X~{T? P.S / ,& %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. -./0 / THE APPELLANT 2. 12/0 / THE RESPONDENT. 3. 3 3 ' 4! ( -. ) / THE CIT, MUMBAI. 4. 3 3 ' 4! / CIT(A)- , MUMBAI 5. 5&6 1! , 3 -.* - 7 , ' ( / DR, ITAT, MUMBAI 6. 8 9( / GUARD FILE. / BY ORDER, 25.! 1! //TRUE COPY// / (DY./ASSTT. REGISTRAR) , ' ( / ITAT, MUMBAI,