JAGANNATH TUKARAM DINDEKAR, THANE V. ITO WD 4(1), THANE

ITA 5373/MUM/2013

• Counselvise Citation: 537319914 RSA 2013
• Duration Of Justice: 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 02-08-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ROOPAK KUMAR
• Keywords: Unexplained investment
• Section: 143(3)

Judgement Text

. , IN THE INCOME TAX APPELLATE TRIBUNAL SMC , BENCH MUMBAI , BEFORE SHRI R. K. GUPTA , JM ITA NO. 5373 / MUM/ 20 1 3 ( ASSESSMEN T YEAR : 200 7 - 08 ) JAGANNATH TUKARAM DINDEKAR, BAYABAI SMRUTI, NAIGAON, KOLIWADA, TAL - VASAI, THANE - 401 201 VS. ITO WARD - 4(1), THANE PAN/GIR NO. : A EAPD 9526 Q ( APPELLANT ) .. ( RESPONDENT ) /ASSESSEE BY : SHRI ANIL SATHE /REVENUE BY : SHRI ROOPAK KUMAR DATE OF HEARING : 21 ST AUGUST , 201 3 DATE OF PRONOUNCEMENT : 28 TH AUGUST , 2013 O R D E R TH E ASSESSEE HAS PREFERRED THIS APPEAL AGAINST THE ORDER OF LEANED CIT(A) RELA TING TO THE ASSESSMENT YEAR 200 7 - 08 . 2 . THE EFFECTIVE GROUND IS AGAINST SUSTAINING AN ADDITION OF RS. 5,04,444/ - AS UNDISCLOSED SALES AND THEREBY TREATING AN INVESTMENT OF R S. 4,9 1,316/ - AS UNEXPLAINED INVESTMENT. 3 . BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS CARRYING ON THE BUSINESS OF PURCHASE AND SALES OF FISH ON COMMISSION BASIS. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO NOTICED THAT THE ITA NO. 5373 /20 1 3 2 ASSESSEE HAS BEEN DOING BUSINESS OF COMMISSION SUBSTANTIALLY IN CASH . ACCORDINGLY, THE ASSESSEE WAS REQUIRED TO FURNISH THE STATEMENT OF VARIOUS BANKS. ON VERIFICATION OF BANK ACCOUNTS, THE AO NOTICED THAT THE SUBSTANTIAL AMOUNT HAS BEEN DEPOSITED IN THREE BANKS TOTALING TO RS.1 8,91,000/ - . THE AO NOTICED THAT THE ASSESSEE COULD NOT EXPLAIN THE SOURCES OF INVESTMENT IN BANKS AND COMMISSION RECEIPT OF RS. 4,41,370/ - . ACCORDINGLY, HE WORKED OUT THE UNEXPLAINED CASH ON THE BASIS OF CASH DEPOSITED IN THE BANK AND ON THE BASIS OF THE AM OUNT RECEIVED ON COMMISSION ON SALE IN EARLIER YEAR. THE AO FOUND THAT THE AMOUNT OF RS.13,86,556/ - STOOD EXPLAINED AND REMAINING AMOUNT OF RS. 5,04,444/ - REMAINED UNEXPLAINED. ACCORDINGLY, HE MADE THE ADDITION TO THIS EXTENT. 4. DETAILED SUBMISSIONS WER E FILED BEFORE THE CIT(A) . IT WAS EXPLAINED THAT THE COMMISSION INCOME HAS BEEN ACCEPTED IN THE SUBSEQUENT YEAR. AFTER CONSIDERING THE SUBMISSION, LEARNED CIT(A) FOUND THAT THE CASH DEPOSITED IN THE BANK IS DULY EXPLAINED. THEREFORE, THE AO WAS NOT CORRECT IN HOLDING THE CASH DEPOSITED IN THE BANK IS NOT EXPLAINED. HOWEVER, LEARNED CIT(A) NOTED THAT THE TOTAL INVESTMENT HAS BEEN MADE BY THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION AT RS. 19,30,000/ - AND AFTER ALLOWING THE AVAILABILITY OF CASH AND OTHER INCOME, THE CIT(A) FOUND THAT A SUM OF RS. 4,91,316/ - REMAINED UNEXPLAINED OUT OF TOTAL INVESTMENT AT RS. 19,30,000/ - . THEREFORE, HE SUSTAINED ADDITION OF RS. 4,91,316/ - AGAINST THE ADDITION OF ITA NO. 5373 /20 1 3 3 RS. 5,04,441/ - MADE BY THE AO. NOW, THE ASSESSEE IS IN APPEAL HERE BEFORE THE TRIBUNAL 5 . LEARNED COUNSEL OF THE ASSESSEE STATED THAT NEITHER ANY OPPORTUNITY WAS GRANTED BY THE LEARNED CIT(A) TO EXPLAIN THE INVESTMENT NOR ANY OTHER MATERIAL WAS BROUGHT ON RECORD. THE ASSESSEE IS INDULGED IN PURCHASE AND SALE OF FISH ON COMMISSION BASIS. IT WAS FURTHER SUBMITTED THAT THE ASSESSMENT FOR ASSESSMENT YEAR 2009 - 10 HAS BEEN COMPLETED UNDER SECTION 143(3) , WHERE THE COMMISSION INCOME SHOWN BY THE ASSESSEE HAS BEEN ACCEPTED. COPY OF THE SAME WAS ALSO FILED. 6 . ON THE OTHER HAND, LEARNED DR PLACED RELIANCE ON THE ORDER OF CIT(A) . 7 . AFTER CONSIDERING THE SUBMISSION AND PERUSING THE MATERIAL ON RECORD, I FOUND THAT THE ASSESSEE DESERVES TO SUCCEED IN ITS APPEAL . FIRSTLY, I FOUND THAT NO OPPORTUNITY HAS BEEN PROVIDED BY THE LEARNE D CIT(A) TO EXPLAIN THE INVESTMENT MADE BY THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION. IT IS MANDATORY O N THE PART OF THE LEARNED CIT(A) THAT IF HE WANTS TO PROCEED IN ANY OTHER MANNER THAT OF THE AO, THEN HE HAS TO GRANT OPPORTUNITY TO THE ASSESSEE AS PROVIDED UNDER SECTION 251(2) OF THE ACT. HENCE , THE CONTENTION OF THE LEARNED CIT(A) THAT THE ASSESSEE WAS NOT ABLE TO EXPLAIN THE INVESTMENT MADE DURING THE YEAR UNDER CONSIDERATION AT RS. 19,30,000/ - IS NOT CORRECT. REGARDING THE CASH DEPOSIT OF RS. 18 ,91,000/ - , THE CIT(A) HAS HIMSELF STATED THAT THE ITA NO. 5373 /20 1 3 4 AO WAS NOT CORRECT IN TREATING THE CASH DEPOSIT AS UNEXPLAINED AS THE ASSESSEE WAS INDULGED IN PURCHASE AND SALE OF FISH ON COMMISSION BASIS AND THE ENTIRE RECEIPTS WERE DEPOSITED IN ITS BANK ACCOUNT. THERE IS ALSO NO DISPUTE THAT THE ASSESSEE IS DOING SALE AND PURCHASE OF FISH ON COMMISSION BASIS AS THE SAME HAS BEEN ACCEPTED IN PAST AS WELL AS IN SUBSEQUENT YEAR WHILE PASSING THE ASSESSMENT UNDER SECTION 143(3). THEREFORE, I SEE NO REASON TO MAKE ANY ADDIT ION AT THE PART OF THE AO OR AT THE END OF THE LEARNED CIT(A) . ACCORDINGLY, THE ADDITION MADE BY THE AO AS WELL AS BY THE LEARNED CIT(A) ARE HEREBY DELETED. 8 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 28 TH DAY OF AUG .2013 SD/ - ( ) ( R.K.GUPTA ) / JUDICIAL MEMBER MUMBAI ; DATED : 28/08 / 2013 /PKM , PS COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDE NT. 3. / THE CIT(A) , MUMBAI. 4. / CIT 5. / DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY// / BY ORDER, ( ASSTT. REGISTRAR) / ITAT, MUMBAI