PATANJALIKA DESAI, MUMBAI V. ITO 18(1)(3), MUMBAI

ITA 4793/MUM/2009

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 8783 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-01-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 10-01-2011
• Assessment Year: 2003-2004
• Appeal Filed On: 18-08-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SU RENDRA KUMAR
• Keywords: Unexplained investment; Business expenditure; Opportunity of being heard; Capital expenditure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH C : MUMBAI BEFORE SHRI D.K. AGARWAL, (JM) AND SHRI B. RAMAKO TAIAH,(AM) ITA NO.4793/MUM/2009 ASSESSMENT YEAR : 2003-04 SMT. PATANJALIKA DESAI C/33, 4 TH FLOOR, DHANRAJ MAHAL C/3, MARG, APPOLLO BUNDER, COLABA MUMBAI 400 039. ..( APPELLANT ) P.A. NO: (ABSPD 0609 B) VS. INCOME TAX OFFICER-18(1)(3) MUMBAI. ..( RESPONDENT ) APPELLANT BY : SHR I HARESH P. SHAH RESPONDENT BY : SHRI SURENDRA KUMAR O R D E R PER D.K. AGARWAL (JM). THIS APPEAL PREFERRED BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER DATED 20.4.2009 PASSED BY THE LD. CIT(A) FOR TH E ASSESSMENT YEAR 2003-04. 2. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE ASSESSEE A N INDIVIDUAL DERIVES INCOME FROM MANUFACTURING AND SALE O F READY-MADE GARMENTS, FILED RETURN DECLARING TOTAL INCOME RS.1,05,9 10/-. THE ASSESSING OFFICER AFTER SELECTING THE CASE FOR SCRUTINY ISSUED NOTICE U/S.143(2) FOLLOWED BY QUESTIONNAIRE ALONG WITH NOTICE U/S.142(1) AND 143(2) OF THE INCOME TAX ACT, 1961 (THE ACT). IN COMPLI ANCE THE ASSESSEE ATTENDED AND FILED DETAILS. DURING THE COURSE OF ASSESSMENT ITA NO.4793/M/09 A.Y:03-04 2 PROCEEDING THE ASSESSEE WAS FURTHER ASKED TO FILE CERTAIN DETAILS. IN THE ABSENCE OF ANY PROPER COMPLIANCE, THE ASSESSING OFFICER COMPLETED THE EXPARTE ASSESSMENT U/S.144 OF THE ACT VIDE ORDER DATED 8.3.2006 AS UNDER :- I INCOME FROM BUSINESS 1. FROM PATCHES INTERNATIONAL RS.60,000/- 2. FROM M/S. KUNAL KNITWEAR RS.45,911/- ADD: ADDITIONS/DISALLOWANCES: I) ADDITION ON A/C. FALL IN GP RS.16,85,626/- II) ON A/C. FACTORY ADVANCE TREATED AS CAPITAL EXPENDITURE RS.1,02,000/- III) ON A/C. GUEST HOUSE RENT TREATED AS NON- BUSINESS EXPENDITURE RS.60,000/- IV) ON A/C. OF UNEXPLAINED INVESTMENT IN LOANS, ADVANCE & CLAIM RS .2,08,805/- RS.21,02,342/- II. INCOME FROM CAPITAL GAINS RS.NIL III. INCOME FROM OTHER SOURCES RS. 245/- GROSS TOTAL INCOME RS.21,62,587/- LESS: DEDUCTION U/CH.VI A _____RS.245/- TOTAL INCOME RS.21,62,342/- ROUNDED OFF TO RS.21,82,340/- 3. ON APPEAL, THE LD. CIT(A) ALSO ASKED TO FILE CERTAI N DETAILS AND PROVIDED VARIOUS DATES OF HEARING TO THE ASSESSEE. IN T HE ABSENCE OF ANY PROPER COMPLIANCE, EXCEPT ASKING FOR ADJOURNMENT, THE LD. CIT(A) VIDE HIS EXPARTE ORDER WHILE APPLYING THE DECISION OF THE TRIBUNAL IN MULTIPLAN INDIA PVT. LTD. 38 ITD 320 AND ESTATE OF L ATE TUKOJIRAO ITA NO.4793/M/09 A.Y:03-04 3 HOLKAR VS. CWT 223 ITR 480 (MP) CONFIRMED THE ADDITIO NS MADE BY THE ASSESSING OFFICER . 4. BEING AGGRIEVED BY THE ORDER OF THE LD. CIT(A) T HE ASSESSEE IS IN APPEAL BEFORE US CHALLENGING IN ALL THE GROUNDS THE DE NIAL OF OPPORTUNITY BY THE LD. CIT(A) AND SUSTENANCE OF ADD ITION MADE BY THE ASSESSING OFFICER . 5. AT THE TIME OF HEARING THE LD. COUNSEL FOR THE ASSE SSEE SUBMITS THAT SINCE NO PROPER OPPORTUNITY WAS ALLOWED, THEREFO RE, IN THE INTEREST OF JUSTICE THE MATTER MAY BE SET ASIDE TO THE FILE OF T HE LD. CIT(A) . 6. ON THE OTHER HAND THE LD. DR WHILE RELYING ON TH E ORDER OF THE ASSESSING OFFICER AND THE LD. CIT(A) SUBMITS THAT IN THIS CASE THE LD. CIT(A) HAS PROVIDED VARIOUS OPPORTUNITIES TO THE ASSESSEE AND THE ASSESSEE HAS FAILED TO MAKE COMPLIANCE THEREOF, THEREFORE, THE ORDER PASSED BY THE LD. CIT(A) BE UPHELD. 7. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE RI VAL PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THERE IS NO DISPUTE THAT THE ASSESSING OFFICER AND THE LD. CIT(A) HA VE PROVIDED SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE . HOWEVER, THE ASSESSEE MERELY SEEKING ADJOURNMENTS HAS MADE NO COMPLIANCE . SINCE IN THIS CASE HUGE ADDITIONS HAVE BEEN MADE AND THE ORDER OF THE LD. CIT(A) IS NOT IN ACCORDANCE WITH THE PROVISIONS OF SEC.250(6) OF THE ACT WHICH PROVIDES THAT THE ORDER SHALL STATE THE POINT S FOR DETERMINATION, THE DECISION THEREON AND THE REASON FOR THE DECISION, THEREFORE, IN THE INTEREST OF JUSTICE WE CONSIDER IT FA IR AND REASONABLE ITA NO.4793/M/09 A.Y:03-04 4 THAT ONE MORE OPPORTUNITY MAY BE PROVIDED TO THE ASSE SSEE TO REPRESENT HIS CASE BEFORE THE LD. CIT(A) AND ACCORDINGLY WE SET ASIDE THE ORDER PASSED BY THE LD. CIT(A) AND SEND BACK THE MA TTER TO HIS FILE WHO SHALL DECIDE THE SAME AFRESH AND ACCORDING TO LAW AFT ER PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE GROUNDS TAKEN BY THE ASSESSEE, ARE THEREFORE, PARTLY ALLOWED FO R STATISTICAL PURPOSES. 8. IN THE RESULT, ASSESSEE'S APPEAL STANDS PARTLY ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED IN THE OPEN COURT ON 19.1.2011. SD/- SD/- (B. RAMAKOTAIAH) ( D.K. AGARWAL ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 19.1.2011. JV. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR BENCH TRUE COPY BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.