ZAMINDAR FURQAN RAMZAN, MUMBAI V. ACIT CIR 19(2), MUMBAI

ITA 446/MUM/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 88177 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-01-2015
• Appeal Filed By: Assessee
• Bench Allotted: G
• Next Hearing Date: 18-12-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 17-01-2011
• Court: TRIBUNAL
• Department Lawyers: R N DSOUZA
• Keywords: Opportunity of being heard
• Section: 27; 144

Judgement Text

IN THE INCO ME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER ./I.T.A. NO. 446/M/2011 ( / ASSESSMENT YEAR : 2006 - 2007 ) ZAMINDAR FURZAN RAMZAN, FLAT NO.4, 35/C, BEACH RESORT, JUHU KOLIWADA, SANTACRUZ (W), MUMBAI 400 054. / VS. ACIT CIRCLE 19(2), MUMBAI. ./ PAN : AAFPZ2211A ( / APPELLANT) .. ( / RESPONDENT ) / APPELLANT BY : SHRI K. GOPAL / RESPONDENT BY : SHRI R.N. DSOUZA, DR / DATE OF HEARING : 18 .12.2014 / DATE OF PRONOUNCEMENT : 21 .01.2015 / O R D E R PER D. KARUNAKARA RAO, AM: THIS APPEAL FILED BY THE ASSESSEE ON 17.01.2011 IS AGAINST THE ORDER OF THE CIT (A) - 30, MUMBAI DATED 22.11.2010 FOR THE ASSESSMENT YEAR 2006 - 2007. IN THIS APPEAL, ASSESSEE RAISED THE FOLLOWING GROUNDS WHICH READ AS UNDER: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD CIT (A) 1. ERRED IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER IN PASSING THE ASST. ORDER COMPLETED U/S 144. 2. SHOULD HAVE APPRECIATED THAT SINCE THE ASSESSING OFFICER HAS PASSED THE ASSESSMENT ORDER EX - PARTE, THE ASSESSEE SHOULD HAVE ;BEEN GIVEN OPPORTUNITY TO SUBMIT THE BILLS AND OTHER RECORDS AND SHOULD HAVE VERIFIED THE BILLS AND OTHER DETAILS ALREADY SUBMITTED BEFORE THE ASSESSING OFFICER AND SHOULD NOT HAVE CONFIRMED THE EX - PARTE ORDER. 3. ERRED IN CONFIRMING THE ACTION O F THE ASSESSING OFFICER IN MAKING THE ADDITION OF RS. 1,65,70,521/ - ON THE GROUND THAT TDS HAS NOT BEEN DEDUCTED ON THE LABOUR CHARGES PAID TO WORKERS WHEN THE FULL PARTY WISE DETAILS WERE ALREADY SUBMITTED BEFORE THE LD CIT (A). 4. FURTHER ERRED IN CONFIRMI NG THE ACTION OF THE ASSESSING OFFICER IN MAKING AN AD - HOC ADDITION OF RS. 20 LAKHS ON ACCOUNT OF NON - VERIFICATION OF EXPENSES. 5. ERRED IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER IN MAKING THE ADDITION OF RS. 31,75,238/ - ON THE GROUND THAT THE BILLS A ND OTHER DETAILS WHICH ARE SUBMITTED BEFORE THE LD CIT (A) WERE NOT SUBMITTED BEFORE THE ASSESSING OFFICER. 6. ERRED IN CONFIRMING THE ADDITION OF RS. 2,80,935/ - ON ACCOUNT OF LOW WITHDRAWALS WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE IS LIVING IN A JO INT FAMILY AND THT HIS EXPENSES WOULD NOT BE SO HIGH. 2. IN THIS APPEAL, ASSESSEE RAISED VARIOUS ISSUES IN THE GROUNDS NAMELY (I) THE COMPLETION OF EX - PARTE ASSESSMENT WITHOUT GIVING PROPER OPPORTUNITY; (II) ADDITION OF RS. 1,45,70,521/ - ; (III) DISALLOWANCE OF EXPENSES AMOUNTING TO RS. 31,75,238/ - AND (IV) LOWER WITHDRAWALS. AT THE OUTSET, LD COUNSEL FOR THE ASSESSEE BROUGHT OUR 2 ATTENTION TO THE ASSESSMENT ORDER AND MENTIONED THAT THE SAME WAS PASSED BY THE ASSESSING OFFICER U/S 144 OF THE ACT AND WITHOUT HEARING THE ASSESSEE EVENTUALLY. HE AGREED TO THE FACT T HAT CERTAIN NOTICES WERE ISSUED IN VARIOUS DATES AND THE LD COUNSEL APPEARED AND THE SAME IS EVIDENT FROM HIS ORDER . HE PARTICULARLY MENTIONED THE DATES I.E, 3 RD , 21 ST AND 27 TH NOVEMBER, 2009 AND SUBMITTED THAT ON THE SAID DATES , THE CHARTERED ACCOUNTANT A PPEARED ON BEHALF OF THE ASSESSEE AND ASSISTED THE ASSESSING OFFICER. HOWEVER, THE ASSESSING OFFICER PASSED THE ORDER ON 22.12.2008 MAKING HUGE ADDITIONS DETERMINING THE TOTAL INCOME AT RS. 2,13,44,350/ - AGAINST THE RETURNED INCOME OF RS.13,17,660/ - . CIT (A) CONFIRMED THE ABOVE ADDITIONS MAINLY ON ACCOUNT OF ASSESSEES FAILURE TO FURNISH REQUISITE DETAILS. CIT (A) ALSO DISMISSED THE ASSESSEES OBJECTIONS AGAINST THE IMPUGNED EX - PARTE ASSESSMENT ORDER PASSED U/S 144 OF THE ACT. 3. IN THE BACKGROUND OF THE ABOVE FACTS, LD COUNSEL FOR THE ASSESSEE MENTIONED THAT IT IS NOT CORRECT THAT THE ASSESSEE HAS NOT ATTENDED TO THE PROCEEDINGS BEFORE THE ASSESSING OFFICER. IT IS ALSO A QUESTION OF GRANTING OF SOME MORE OPPORTUNITIES WHICH WERE NOT GIVEN BY THE ASSESSIN G OFFICER TO THE ASSESSEE. LD COUNSEL FOR THE ASSESSEE ARGUED THAT THE CASE MAY BE REMANDED TO THE FILE OF THE ASSESSING OFFICER AND MADE A STATEMENT AT BAR THAT HE WOULD COOPERATE FOR MAKING OF PROPER ASSESSMENT. FURTHER, LD COUNSEL MENTIONED THAT EX - PA RTE ASSESSEE IS BAD IN LAW AS THE ASSESSEE IS A CIVIL CONTRACTOR AND WITH ADDITIONS THE GP IS ASSESSED NEARLY AT 96%, WHICH PRIMA FACIE IS UNFAIR AND THE JUDGMENT OF THE ASSESSING OFFICER IS UNSUSTAINABLE IN LAW. 4. ON THE OTHER HAND, LD DR RELIED ON THE O RDERS OF THE REVENUE AUTHORITIES. 5. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE ORDERS OF THE REVENUE AUTHORITIES AS WELL AS THE RELEVANT MATERIAL PLACED BEFORE US. ON HEARING BOTH THE PARTIES, WE FIND MERIT IN THE ARGUMENT OF THE LD COUNSEL FOR THE A SSESSEE THAT THE ASSESSMENT , WHICH RESULTED IN THE GP @ 96% IS UNSUSTAINABLE. SUCH ASSESSMENT CANNOT BE RATED AS BEST JUDGMENT AS THERE IS CASE WITH 96% AS GP IN THE LINE OF ASSESSEES BUSINESS OF REAL ESTATE. IT IS THE PRAYER OF THE LD COUNSEL THAT THEY WOULD COOPERATE AND FILE RELEVANT DETAILS FOR MAKING OF A PROPER ASSESSMENT BEFORE THE 3 ASSESSING OFFICER IF AN OPPORTUNITY IS GRANTED. ON CONSIDERING THE FACTS OF THE CASE, WE FIND IT PROPER TO REMAND THE MATTER FOR WANT OF FACTS TO THE FILE OF ASSESSING OFFICER FOR FRESH ADJUDICATION AFTER GRANTING A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. ACCORDINGLY, GROUNDS RAISED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL P URPOSES. ORDER PRONOUNC ED IN THE OPEN COURT ON 2 1 S T JANUARY, 2015. S D / - S D / - (VIJAY PAL RAO) (D. KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; 2 1 .1.2015 . . ./ OKK , SR. PS / 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