M/S AAP REALTORS LTD., Mumbai V. DCIT CC 4 (2), Mumbai

ITA 4857/MUM/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 2525 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 3 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-10-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2015-2016
• Appeal Filed On: 19-07-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Principle of natural justice; Additional evidence; Set aside
• Section: 143(3); 142(1); 250; 143(2); 22; 20

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH , MUMBAI BEFORE SHRI S RIFAUR RAHMAN, ACCOUNTANT MEMBER & PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA NO. 4857 /MUM/20 19 (A.Y : 20 1 5 - 1 6 ) M/S. AAP REALTORS LTD,CTS B - 622,OPP S H KELKAR AND CO,BALRAJESHWAR ROAD, MULUND (W), MUMBAI 400080 . VS. DCIT CC 4(2), AIR INDIA BUILDING, NARIMAN POINT, MUMBAI - 40002 1 ./ ./ PAN/GIR NO. : AA HCA0540M APPELLANT .. RESPONDENT APPELLANT BY : SHRI.ANUJ KISHNADWALA. AR RESPONDENT B Y : SHRI. MEHUL JAIN. DR DATE OF HEARING 27.10 .2021 DATE OF PRONOUNCEMENT 29 .10 .2021 / O R D E R PER PAVAN KUMAR GADALE JM : THE ASSESSEE HAS FILED THE APPEAL AGAINST THE ORDER OF THE COMMISS IONER OF INCOME TAX (APPEALS) - 52 , MUMBAI PASSED U/S 143(3) AND 250 OF THE INCOME TAX ACT, 1961 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. THE LEARNED CIT(A) ERRED IN LAW AND IN FACTS IN NOT HOLDING THAT THE ASSESSEEMENT ORDER U/SEC143(3) OF THE ACT PASSED BY THE AO IS BAD IN LAW, ILLEGAL AND NULL AND VOID. ITA NO. 4857 / MUM/20 19 M/S. AAP REALTORS LTD , MUMBAI - 2 - 2. THE LEARNED CIT(A) HAS ERRED IN LAW AND IN FACTS IN NOT HOLDING THAT THE A.O. ERRED IN PASSING THE ASSESSMENT ORDER IN GROSS VIOLATION OF PRINCIPLES OF NATURAL JUSTICE. 3.THE LEARNED CIT(A) HAS ERRED IN LAW AND IN FACTS IN CONFIRMING THE DISALLOWANCE OF RS.14,14,557/ - ON ACCOUNT OF SELLING AND MARKETING EXPENSES U/SEC37(1)OF THE ACT . 2. THE BRIEF FACTS OF THE CASE ARE THAT, THE ASSESSEE COMPANY IS ENGAGED IN THE BUSINESS OF REAL ESTATE AND CONSTRUCTION ACTIVITIES. THE ASSESSEE HAS FILED THE RETURN OF INCOME FOR THE A.Y 2015 - 16 ON 31.10.2015 DISCLOSING A TOTAL INCOME OF RS.9,25,32,776/ - SUBSEQUENTLY THE CASE WAS SELECTED FOR SCRUTINY AND THE A.O . HAS ISSUED NOTICE U/S 143(2) AND 142(1) OF THE ACT . IN COMPLIANCE , THE LD. AR OF THE ASSESSEE HAS FURNISHED THE DETAILS FROM TIME TO TIME. THERE WAS SURVEY U/SEC133A OF THE ACT ON TRANSCON GROUP ON 22 - 01 - 2015 AND VARIOUS INCRIMINATING DOCUMENTS WERE IMP OUNDED AT THE ASSESSES PREMISES. THE A.O ON PERUSAL OF THE FINANCIAL STATEMENT S FOUND THAT THE SEL LING AND MARKETING EXPENSES DEBITED IN THE PROFIT AND LOSS ACCOUNT O F RS.1,41, 45,569/ - ARE NOT SUPPORT ED WITH THE PROPER DETAILS AND MADE ADHOC ADDITION @20% ITA NO. 4857 / MUM/20 19 M/S. AAP REALTORS LTD , MUMBAI - 3 - WHICH WORKED OUT TO RS.14,14,557/ - . SIMILARLY MADE THE ADDITION OF SHO R T FALL OF INCOME DISCLOSED IN SURVEY O PERATIONS OF RS.5,41,067/ - AND ASSESSED THE TOTAL INCOME OF RS.9,30,73,850/ - AND PASSED THE O RDE R U/S 143(3) OF THE ACT DATED 13.10.2017 . 3 . AGGRIEVED BY THE ORDER , THE ASSESSEE HAS FILED AN APPEAL BEFORE THE CIT(A). IN THE APPELLATE PROCEEDINGS THE CIT(A) CONSIDERED THE GROUNDS OF APPEAL, FINDINGS OF THE A.O AND THE SUBMISSIONS AND HAS CONFIRMED THE DISALLOWANCE OF SELLING & MARKETING EXPENSES AND GRANTED RELIEF IN OTHER GROUNDS OF APPEAL AND PARTLY ALLOWED THE ASSESSEE APPEAL. AGGRIEVED BY THE ORDER OF THE CIT(A) , THE ASSESSEE HAS FILED AN APPEAL BEFORE THE HONBLE TRIBUNAL. 4 . AT TH E TIME OF HEARING , THE LD. AR MADE SUBMISSIONS ON THE ADMISSION OF T HE ADDITIONAL EVIDENCE. THE CONTENTION S OF THE LD. AR ARE T HAT THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE IN SUBMITTING THE INFORMATION BEFORE THE A.O IN RESPECT OF SELLING AND MARKETING EXPENSES. THE LD. AR MADE SUBMISSIONS ON THE MERITS OF THE CASE AND PRAYED FOR AN OPPORTUNITY OF HEARING TO SUBSTANTIATE THE CASE WITH THE EVIDENCES BEFORE ITA NO. 4857 / MUM/20 19 M/S. AAP REALTORS LTD , MUMBAI - 4 - THE LOWER AUTHORITIES . CONTRA, THE LD. DR RELIED ON TH E ORDER OF THE CIT(A) . 5 . WE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE SOLE CR UX OF THE DISPUTED ISSUE IS IN RESPECT OF ADMISSION OF ADDITIONAL EVIDENCE WHICH COULD NOT BE FILED FOR VARIOUS RE ASONS. THE CONTENTION S OF THE LD. AR ARE THAT THE ADDITIONAL EVIDENCE PLAY A VITAL ROLE IN DECISION MAKING AN D IN THE ASSESSMENT PROCEEDINGS , THE ASSESSEE COULD NOT SUBMIT THE COMPLETE DETAILS OF INVOICES, BILLS AND VOUCHERS OF SELLING & MARKETING EXPENSES . 6. WE HAVE CONSIDE RED THE FACTS, CIRCUMSTANCES, ADDITION AL EVIDENCES AND THE PAPER BOOK . W E ARE OF THE OPINION THAT THE ASSESSEE SHOULD NOT SUFFER FOR NON FILIN G OF MATERIAL INFORMATION, AS THE EVIDENCES PLAYED VI TAL ROLE AND WE ADMIT THE ADDITIONAL EVIDENCE. ACCORDINGLY, TO MEET THE ENDS OF JUSTICE AND CONSIDERI NG THE PRINCIPLES OF NATURAL JUSTICE , WE SET ASIDE THE ORDER OF THE CIT(A) AND RESTORE THE ENTIRE DISPUTED ISSUE ALONG WITH THE ADDITIONAL EVIDENCE TO THE FILE OF THE ASSESSING OFFICER TO DECIDE ON MERITS AND THE ASSESSEE SHOULD BE PROVIDED ADE QUATE OPPORTUNITY OF HEARING. THE AS SESSEE SHOULD COOPERATE IN ITA NO. 4857 / MUM/20 19 M/S. AAP REALTORS LTD , MUMBAI - 5 - FILLING THE INFORMATION FOR EARLY DISPOSAL OF THE APPEAL AND ALLOW THE GROUNDS OF APPEAL OF THE ASSESSEE FOR STATISTICAL PURPOSES. 7 . IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATIS TICAL PURPOSES . ORDER PR ONOUNCED IN THE OPEN COURT ON 29 .10 .2021 . SD/ - SD/ - ( S RIFAUR RAHMAN ) ( PAVAN KUMAR GADALE) ACCOUNTANT MEMBER J UDICIAL MEMBER M UMBAI, DATED 29 .10 .2021 S K, PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / THE CIT(A) 4. ( ) / CONCERNED CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . / BY ORDER, //TRUE COPY// 1 . ( ASST. REGISTRAR) ITAT, MUMBAI