GOLDIE PREM AHUJA, MUMBAI V. ACIT CEN CIR 29, MUMBAI

ITA 4545/MUM/2013

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 2476 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 5 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-11-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Next Hearing Date: 15-10-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 07-06-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: GOLI SRINIWAS RAO
• Assessee Lawyers: SANJIV M SHAH
• Keywords: Search and seizure
• Section: 153A; 132; 154

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI BEFORE HONBLE S/SHRI SAKTIJIT DEY (JM) , AND ASHWANI TANEJA (AM) ./I.T.A. NO.4545 TO 4548/MUM/2013 ( / ASSESSMENT YEARS:2008-09 TO 2011-12) GOLDIE PREM AHUJA, 2, RENDEZVOUS APARTMENTS, GROUND FLOOR, RAVIRAJ OBEROI COMPLEX, OFF. NEW LINK ROAD, ANDHERI (W), MUMBAI-400053 / VS. ASSISTANT COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 29, MUMBAI ( / APPELLANT) .. ( / RESPONDENT) ./ ./PAN. :AEVPA5082K / ASSESSEE BY SHRI SANJIV M SHAH /REVENUE BY SHRI GOLI SRINIWAS RAO ! / DATE OF HEARING :15.10.2015 ! /DATE OF PRONOUNCEMENT:18.11.2015 / O R D E R PER BENCH: THESE ARE FOUR APPEALS FILED BY THE ASSESSEE AGAINST FOUR SEPARATE ORDERS DATED 28.3.2013 PASSED BY THE LD.CIT(A)-40, MUMBAI AND THESE APPEALS RELATE TO THE DIFFERENT ASSESSMENT YEARS. S INCE ISSUES RAISED IN ALL THESE APPEALS ARE COMMON, THESE APPEALS WERE HEARD TOGETHER AND DECIDED BY THIS CONSOLIDATED ORDER, FOR THE SAKE OF CONVENIENCE. ITA NO.4545 TO 4548/MUM/13 2 2. FIRST WE TAKE UP APPEAL FOR THE ASSESSMENT YEAR 2008-09. 3. IN THIS APPEAL, THE ASSESSEE HAS RAISED FOLLOWIN G GROUNDS: A) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD.CIT(A) HAS ERRED IN NOT APPRECIATING THE FA CT THAT THE ORDER PASSED BY THE AO IS WITHOUT JURISDICTION AND BAD IN LAW AS THE JURISDICTION U/S 153A IS VITIATED. B) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD.CIT(A) HAS ERRED CONFIRMING ADDITION MADE BY AO ON ACCOUNT OF UNDISCLOSED BROKERAGE OF RS.1,89,292/- WHICH WA S NEVER RECEIVED BY THE APPELLANT; C) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD.CIT(A) HAS ERRED CONFIRMING ADDITION OF UNDI SCLOSED BROKERAGE INCOME, EVEN ON THE AMOUNT WHICH PERTAINING TO BRO KERAGE INCOME FROM BUILDERS OTHER THAN THOSE WHO WERE SEARCHED AN D SUCH ADDITION AMOUNTED TO RS.146486/- 4. AT THE TIME OF HEARING, THE LD. COUNSEL APPEARIN G FOR THE ASSESSEE DID NOT PRESS GROUND NO.1, THEREFORE, DISMISSED AS NOT PRESSED. 5. IN GROUND NO.2, THE ASSESSEE HAS CONTESTED THE A CTION OF LD. CIT(A) IN CONFIRMING THE ADDITION MADE BY THE AO ON ACCOU NT OF UNDISCLOSED BROKERAGE INCOME OF RS.1,89,292/-, WHICH ACCORDING TO THE ASSESSEE, WAS IN FACT, NOT RECEIVED BY IT. 6. DURING THE COURSE OF HEARING, THE LD. AR AT THE VERY OUTSET, SUBMITTED THAT THIS ISSUE IS NOW COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE MUMBAI BENCH OF THE TRIBUNAL IN AS SESSEES OWN CASE IN ITA NO.4544/MUM/2013 (AY-1999-2000) DATED 24.7.2013 . ITA NO.4545 TO 4548/MUM/13 3 7. ON THE OTHER HAND, THE LD. DR RELIED UPON THE O RDERS OF AUTHORITIES BELOW. 8. WE HAVE GONE THROUGH THE ARGUMENTS MADE BY BOTH THE SIDES AS WELL AS ORDERS OF THE LOWER AUTHORITIES AND ALSO TH E DECISION OF THE MUMBAI BENCH OF THE TRIBUNAL IN ASSESSEES OWN CASE. THE FACTS LEADING LO THE ABOVE ADDITION, AS RECORDED IN THE ASSESSMENT ORDER , ARE THAT A SEARCH AND SEIZURE ACTION U/S 132 OF THE IT. ACT WAS CONDUCTED ON SHRI NARESH BHAISHANKAR RAWAL GROUP ON 20/11/2010 A ND THE MAIN FIRMS OF THE GROUP WERE M/S. SURGICAL METAL INDUSTR IES AND M/S. TINWALA INDUSTRIES WHICH WERE ENGAGED IN THE BUSINE SS OF CONSTRUCTION OF RESIDENTIAL AND COMMERCIAL PREMISES . THE ASSESSEE WAS A BROKER WORKING FOR THE ABOVE MENTIONED TWO FI RMS. DURING THE COURSE OF THE SEARCH, ASSESSEES STATEMENT WAS RECORDED U/S 132(4) OF THE IT. ACT ON 20/11/2010 AT THE OFFICE P REMISES OF M/S.TINWALA INDUSTRIES, WHEREIN HE ADMITTED THAT TH E MODE OF TRANSACTIONS IN THE CASE OF THE ABOVE MENTIONED TW O BUILDERS WAS BY CHEQUE AS WELL AS IN CASH AND THAT MARKET PRACTICE WAS TO ACCEPT 25% TO 30% SALE CONSIDERATION IN CASH. DURIN G THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO NOTED THAT THE AS SESSEE RECEIVED BROKERAGE @ 2% TO 3% AND THAT DURING THE YEAR UNDER CONSIDERATION HAD DISCLOSED BROKERAGE INCOME OF RS. 4,41,683/-. IN VIEW OF THE ASSESSEES ADMISSION IN HIS STATEMENT R ECORDED U/S 132(4) THAT THE BUILDERS WERE ACCEPTING 25% TO 30% SALE CONSIDERATION IN CASH, THE AO WORKED OUT 2% OF THE CASH COMPONENT IN SALE CONSIDERATION AT RS.1,89,292/- AN D ADDED THE SAID AMOUNT TO THE ASSESSEES TOTAL INCOME AS ADDIT IONAL BROKERAGE INCOME OF THE ASSESSEE. DURING THE COURSE OF APPELL ATE PROCEEDINGS BEFORE LD CIT(A), IT WAS SUBMITTED THAT THE INCOME FROM BROKERAGE ITA NO.4545 TO 4548/MUM/13 4 WAS NOT RECEIVED FROM THE TWO PARTIES, VIZ. M/S SURG ICAL METAL INDUSTRIES AND M/S. TINWALA INDUSTRIES, AND, HENCE THE AMOUNT WORKED OUT BY THE AO WAS BASED ON ERRONEOUS PRESUMP TION. IT WAS FURTHER SUBMITTED THAT DURING THE COURSE OF SEARCH, NO EVIDENCE OR DOCUMENT OR LOOS PAPER WAS FOUND BY THE DEPARTMENT TO INDICATE THAT ANY OF THE AMOUNTS WERE RECEIVED BY WAY OF CAS H BY THE ASSESSEE AND THAT THERE WAS NO BROKERAGE INCOME RECEIVED IN CASH DURING THE YEAR. IT WAS ALSO CLAIM ED THAT THE SAME AMOUNT HAS BEEN TAXED TWICE SINCE IT IS ALSO TAXED IN THE HANDS OF THE BUILDER. THE ASSESSEE FURTHER ARGUED THAT NO U NACCOUNTED CASH DEPOSIT WAS FOUND WITH THE ASSESSEE. THE ASSE SSEE ALSO RELIED UPON PLETHORA OF JUDGMENTS IN SUPPORT OF HIS CONTENTION. 9. HOWEVER, THE LD. CIT(A) DID NOT ACCEPT THE SUBMISS IONS OF THE ASSESSEE. IT WAS HELD THAT BY THE LD. CIT(A) THAT ONCE THE CASH COMPONENT HAS BEEN ADMITTED BY TWO BUILDERS WI TH WHOM THE ASSESSEE HAVING RECEIVED BROKERAGE INCOME AND THE ASSESSEE ADMITTED THAT CASH COMPONENT IN SUCH TRANSACTIONS, IT WAS UNBELIEVABLE THAT HE DID NOT RECEIVE ANY BROKERAGE INCOME ON THE CASH COMPONENT. WITH REGARD TO THE ARGUMENT THAT NO INCRIMINATING DOCUMENTS WERE FOUND, IT WAS HELD BY THE LD. CIT(A) THAT SINCE THE ASSESSEE HIMSELF ADMITTED THE FACT I N THE STATEMENT RECORDED U/S 132(4), NO FURTHER INCRIMINATING DOCUM ENTS WERE REQUIRED. ALL OTHER ARGUMENTS WERE REJECTED BY THE LD. CIT(A), AND DISMISSED THE CONTENTIONS BY APPLYING THE RATIO OF THE JUDGMENT RENDERED BY THE HONBLE SUPREME COURT IN THE CAE OF MCDOWELL (154 ITR 148(SC) AND AZADI BACHAO ANDOLAN (263 IT R 706 (SC). IT WAS HELD THAT ONCE THERE WAS SURRENDER BY THE BU ILDER AND THE ITA NO.4545 TO 4548/MUM/13 5 ASSESSEE ADMITTED THE CASH COMPONENT, THE BROKERAGE IS ALSO BOUND TO BE IN CASH, AND THEREFORE RIGHTLY ADDED BY THE AO. 10. BEING AGGRIEVED BY THE DECISION OF LD. CIT(A), THE ASSESSEE HAS CONTESTED THE ORDER OF LD. CIT(A) BEFORE US. 11. IT IS NOTED BY US, AS BROUGHT TO OUR NOTICE BY THE LD. COUNSEL, THAT IN THE IMMEDIATELY PRECEDING YEAR, AN IDENTICA L ISSUE IN ASSESSEES OWN CASE CAME UP BEFORE THE TRIBUNAL. TH E HONBLE TRIBUNAL DECIDED THIS ISSUE IN FAVOUR OF THE ASSESS EE BY OBSERVING AS UNDER: 5. AFTER CONSIDERING THE SUBMISSIONS ON PERUSING T HE MATERIAL ON RECORD, I FOUND THAT THERE WAS NO BASIS TO MAKE ADD ITION IN THE HANDS OF THE ASSESSEE. NEITHER THERE WAS ANY DOCUME NT NOR ANY LOOSE PAPER NOR ANY EVIDENCE PROVING THAT THE ASSES SEE WAS ALSO EARNING BROKERAGE ON THE AMOUNT OF CASH RECEIVED BY THE BUILDERS WAS ON ACCOUNT OF TRANSACTIONS ENTERED INTO WITH PU RCHASERS. THE CONTENTION OF THE ASSESSEE THAT EVEN THE ASSESSEE H AS NOT MADE ANY TRANSACTION FOR THESE TWO PARTIES FOR THE YEAR UNDE R CONSIDERATION IN RESPECT OF ANY FLAT OR PREMISES BUILT BY THE BUILDE R AND, THEREFORE, FOR THIS REASON ALSO NO ADDITION SHOULD HAVE BEEN M ADE IN THE HANDS OF THE ASSESSEE PRESUMING THAT THE ASSESSEE MUST HA VE EARNED BROKERAGE INCOME. THERE SHOULD BE SOME LIVE LINK B ETWEEN THE TRANSACTION RELATING TO THE ASSESSEE. THE ORDER OF THE AO AND CIT(A) ARE VERY CLEAR AS NO PAPER IN RESPECT OF ANY BROKERAGE INCOME WAS FOUND. WITHOUT ANY MATERIAL ADDITION MAD E IN THE CASE OF SEARCH, IN MY CONSIDERED VIEW, IS NOT JUSTIFIED. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE, I DELETE THE ADDITION OF RS.24,857/-, MADE AND CONFIRMED BY THE LOWER AUTHOR ITIES 12. THE TRIBUNAL HAS CONSIDERED THE FACTS OF THE CA SE AND AMOUNT OF BROKERAGE INCOME ADDED BY THE AO WAS DELETED BY THE TRIBUNAL, INTERALIA, ON THE GROUND THAT THERE WAS NO INCRIMINATING EVIDE NCE TO SHOW THAT THE BROKERAGE INCOME WAS EARNED BY THE ASSESSEE. KEEPI NG IN VIEW THE FACTS ITA NO.4545 TO 4548/MUM/13 6 AND CIRCUMSTANCES OF THE CASE, THE ADDITION MADE BY THE AO ON THIS GROUND WAS DELETED BY THE TRIBUNAL. RESPECTFULLY F OLLOWING THE ORDER OF THE TRIBUNAL, WE ARE BOUND BY THE ORDER OF THE TRIB UNAL AND THEREFORE, RESPECTFULLY FOLLOWING THE ORDER OF THE TRIBUNAL IN ASSESSEES OWN CASE (SUPRA) WE DELETE THE ADDITION OF RS.1,89,292/-MADE BY THE AO. THUS, GROUND NO.2 IS ALLOWED. 13. THE LD. COUNSEL SUBMITTED THAT BY VIRTUE OF REL IEF GIVEN BY THE TRIBUNAL IN THE GROUND NO.2 OF THIS APPEAL, GROUND NO.3 BECOMES INFRUCTUOUS. 14. SINCE, WE HAVE DECIDED GROUND NO.2 IN FAVOUR OF THE ASSESSEE, THEREFORE, THIS GROUND IS DISMISSED AS INFRUCTUOUS. 15. AS RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. 16. NOW WE SHALL TAKE UP THE APPEALS FOR THE ASSESS MENT YEARS 2009-10 AND 2010-11. 17. WE FIND THAT THE GROUNDS RAISED IN THESE APPEAL S ARE IDENTICAL TO THAT IN THE APPEAL FOR THE ASSESSMENT YEAR 2008-09. SIN CE WE HAVE DECIDED THE APPEAL FOR THE ASSESSMENT YEAR 2008-09 IN FAVOU R OF THE ASSESSEE, TO MAINTAIN THE CONSISTENCY WITH THE VIEW TAKEN BY US IN EARLIER YEARS, HERE ALSO WE DIRECT THE AO TO DELETE THE ADDITION MADE B Y THE AO. 18. AS A RESULT THE APPEALS OF THE ASSESSEE ARE PAR TLY ALLOWED. 19. NOW WE SHALL TAKE UP THE APPEAL FOR THE ASSESSM ENT YEAR 2011-12 ITA NO.4545 TO 4548/MUM/13 7 20. GROUNDS NO.1 TO 3: THESE GROUNDS ARE IDENTICAL TO THAT OF THE GROUNDS DECIDED BY US IN EARLIER APPEALS. SINCE, WE HAVE DECIDED THE ABOVE GROUNDS IN FAVOUR OF THE ASSESSEE, THEREFORE, WE DIRECT THE AO TO FOLLOW OUR ORDER OF EARLIER YEARS. 21. IN GROUND NO.4, THE ASSESSEE HAS CONTESTED THE ACTION OF THE LD. CIT(A) IN NOT DIRECTING THE AO TO GIVE CREDIT OF A DVANCE TAX OF RS.11,50,000/- BEING THE AMOUNT CONFISCATED DURING THE SEARCH ACTION. 22. DURING THE COURSE OF HEARING, IT WAS SUBMITTED BY THE LD. COUNSEL THAT THE DIRECTION WAS GIVEN BY LD CIT(A) TO THE A O AND THE SAME IS PENDING FOR IMPLEMENTATION ON THE PART OF THE AO , AND THEREFORE, HE REQUESTED FOR RE-ENFORCEMENT OF THE DIRECTION GIVEN BY THE LD.CIT(A). 23. ON THE OTHER HAND, THE LD. DR MENTIONED THAT HE HAS NO OBJECTION IF THE DIRECTION IS GIVEN FOR GIVING CREDIT OF THE AMO UNT CONFISCATED FROM THE ASSESSEE. 24. WE HAVE GONE THROUGH THE ORDER OF LD. CIT(A) AN D NOTED THAT THE LD.CIT(A) HAS DIRECTED THE AO TO TAKE NECESSARY ACT ION, IN THIS REGARD, AS PER LAW. IT IS FURTHER NOTED THAT THE ASSESSEE HAS FILED RECTIFICATION PETITION U/S 154 OF THE ACT ON 13.3.2013 FOR SEEKING CREDIT OF ADVANCE TAX BEING AMOUNT OF RS.11,50,000/- WHICH WAS CONFISCATED BY T HE INCOME TAX DEPARTMENT DURING THE COURSE OF SEARCH, WHICH BELON GED TO THE ASSESSEE. 25. IN VIEW OF THE AFORESAID FACTUAL POSITION, WE D IRECT THE AO TO DISPOSE OF RECTIFICATION PETITION FILED BY THE ASSESSEE AND TO GIVE CREDIT OF THE ABOVE SAID AMOUNT IN ACCORDANCE WITH LAW AND FACTS. WE DIRECT ACCORDINGLY. ITA NO.4545 TO 4548/MUM/13 8 26. IN THE RESULT, APPEALS OF THE ASSESSEE ARE PART LY ALLOWED. PRONOUNCED ACCORDINGLY ON 18 TH NOV, 2015. $ % & '( ) 18 TH NOV, 2015 SD/- SD/- (SAKTIJIT DEY) (ASHWANI TANEJA) JUDICIAL MEMBER ACCOUNTANT MEMBER % MUMBAI: 18 TH NOV, 2015. . . ./ SRL , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. - ( ) / THE CIT(A)- CONCERNED 4. - / CIT CONCERNED 5. ./ 0 , ! 0 , % / DR, ITAT, MUMBAI CONCERNED 6. 1 / GUARD FILE. ( / BY ORDER, (ASSTT. REGISTRAR) ! 0 , % /ITAT, MUMBAI