GALAXY PREMISES P. LTD, MUMBAI V. DCIT CEN CIR 7(3), MUMBAI

ITA 5462/MUM/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 1139 (ITAT-MUMBAI)
• Duration Of Justice: 7 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-04-2017
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 07-09-2016
• Court: TRIBUNAL
• Department Lawyers: MRS BEENA SANTOSH
• Keywords: Search and seizure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER ITA NO. 5462/M/2016 (AY 2009 - 2010 ) GALAXY PREMISES PRIVATE LIMITED (NOW MERGED WITH PALAVA DWELLERS PRIVATE LIMITED),412, 4 TH FLOOR, 17G, VARDHAMAN CHAMBER, CAWASJI PATEL ROAD, HORNIMAN CIRCLE, FORT, MUMBAI 400 001. / VS. DCIT, CIRCLE - 7(3), R.NO. 655, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI 400 020. ./ PAN : AACCG4239L ( / APPELLANT) .. ( / RESPONDENT ) ITA NO.5463/M/2016 (AY 2009 - 2010) ITA NO.5464/M/2016 (AY 2008 - 2009) LODHA FINSTOCK PRIVATE LIMITED, 412, 4 TH FLOOR, 17G, VARDHAMAN CHAMBER, CAWASJI PATEL ROAD, HORNIMAN CIRCLE, FORT, MUMBAI 400 001. / VS. DCIT, CIRCLE - 7(3), R.NO. 655, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI 400 020. ./ PAN : AABCL3094R ( / APPELLANT) .. ( / RESPONDENT ) ITA NO.5465/M/2016 (AY 2007 - 2008) LODHA ESTATE INDIA LIMITED, 412, 4 TH FLOOR, 17G, VARDHAMAN CHAMBER, CAWASJI PATEL ROAD, HORNIMAN CIRCLE, FORT, MUMBAI 400 001. / VS. DCIT, CIRCLE - 7(3), R.NO. 655, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI 400 020. ./ PAN : AAACL1723E ( / APPELLANT) .. ( / RESPONDENT ) ITA NO.5467/M/2016 (AY 2007 - 2008) ADINATH BUILDERS PRIVATE LIMITED, 412, 4 TH FLOOR, 17G, VARDHAMAN CHAMBER, CAWASJI PATEL ROAD, HORNIMAN CIRCLE, FORT,MUMBAI 400 001. / VS. DCIT, CIRCLE - 7(3), R.NO. 655, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI 400 020. 2 ./ PAN : AAFCA9028E ( / APPELLANT) .. ( / RESPONDENT ) ITA NO.5468/M/2016 (AY 2009 - 2010) SHANTINATH DESIGNER CONSTRUCTION PRIVATE LIMITED, (NOW MERGED WITH AJITNATH HI - TECH BUILDERS PRIVATE LIMITED) 412, 4 TH FLOOR, 17G, VARDHAMAN CHAMBER, CAWASJI PATEL ROAD, HORNIMAN CIRCLE, FORT,MUMBAI 400 001. / VS. DCIT, CIRCLE - 7(3), R.NO. 655, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI 400 020. ./ PAN : AAKCS4534N ( / APPELLANT) .. ( / RESPONDENT ) ITA NO.5469/M/2016 (AY 2009 - 2010) NAMINATH BUILDERS AND FARMS PRIVATE LIMITED, (NOW MERGED WITH AJITNATH HI - TECH BUILDERS PRIVATE LIMITED) 412, 4 TH FLOOR, 17G, VARDHAMAN CHAMBER, CAWASJI PATEL ROAD, HORNIMAN CIRCLE, FORT,MUMBAI 400 001. / VS. DCIT, CIRCLE - 7(3), R.NO. 655, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI 400 020. ./ PAN : AACCN4452A ( / APPELLANT) .. ( / RESPONDENT ) ITA NO.5470/M/2016 (AY 2009 - 2010) SAHAJANAND HI - TECH CONSTRUCTIONS PRIVATE LIMITED, (NOW MERGED WITH PALAVA DWELLERS PRIVATE LIMITED), 412, 4 TH FLOOR, 17G, VARDHAMAN CHAMBER, CAWASJI PATEL ROAD, HORNIMAN CIRCLE, FORT,MUMBAI 400 001. / VS. DCIT, CIRCLE - 7(3), R.NO. 655, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI 400 020. 3 ./ PAN : AAECP1936F ( / APPELLANT) .. ( / RESPONDENT ) ITA NO.54 71 /M/2016 (AY 2008 - 2009 ) DHARMANATH BUILDTECH AND FARMS PRIVATE LIMITED, (NOW MERGED WITH LODHA CONSTRUCTION PRIVATE LIMITED) 412, 4 TH FLOOR, 17G, VARDHAMAN CHAMBER, CAWASJI PATEL ROAD, HORNIMAN CIRCLE, FORT,MUMBAI 400 001. / VS. DCIT, CIRCLE - 7(3), R.NO. 655, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI 400 020. ./ PAN : AACCD6799C ( / APPELLANT) .. ( / RESPONDENT ) / ASSESSEE BY : SHRI VIJAY MEHTA / REVENUE BY : MRS. BEENA SANTOSH, DR / DATE OF HEARING : 25.04 .2017 / DATE OF PRONOUNCEMENT : 25.04 .2017 / O R D E R PER D. KARUNAKARA RAO, AM: THERE ARE NINE APPEAL S , FILED BY VARIOUS ASSESSEE S, UN DER CONSIDERATION FOR THE AYS 2007 - 08; 2008 - 09 AND 2009 - 2010. BRINGING OUR ATTENTION TO THE GROUNDS OF THESE APPEALS, SRI VIJAY MEHTA, LD AR FOR THE SUBMITTED THAT THE ISSUES RAISED IN THE GROUNDS ARE IDENTICAL AND THEREFORE, THESE APPEALS CAN BE CLUBBED AND ADJUDICATED IN THIS COMPOSITE ORDER. 2. NARRATING THE BACK GROUND FACTS OF THESE A PPE A LS, LD AR SUBMITTED THAT THESE ASSESSES RELATE TO THE LODHA GROUP OF CASES. THERE WAS SEARCH AND SEIZURE OPERATION ON THE SAID GROUND AND THE SAID GROUP PREFERRED AND FILED AN APPLICATION BEFORE THE INCOEM TAX SETTLEMENT COMMISSION ( ITSC ) . ALL THES E NI NE ASSESSES ALSO FILED THE A PPLICATION 4 BEFORE THE ITSC OFFERING MEAGRE INCOME ON ACCOUNT OF BROKERAGE ETC. HOWEVER, THE HONBLE ITSC REJECTED THESE NINE APPLICATION S FOR NOT MEETING THE REQUIREMENTS OF THE PROVISIONS OF SECTION 245C R . W . S 245A(B) OF THE AC T. HONBLE ITSC HELD THAT IN ALL THESE CASES, THERE IS NO PENDENCY OF ANY PROCEEDINGS IN SAID CASES AND THE CASE AS DEFINED IN SECTION 245A(B) AND 245C OF THE ACT. THE CASE MEANS ANY PROCEEDINGS FOR ASSESSMENT UNDER THIS ACT, OF ANY PERSON IN RESPECT O F ANY ASSESSMENT YEAR OR ASSESSMENT YEARS WHICH MAY BE PENDING BEFORE THE AO ON THE DATE ON WHICH AN APPLICATION U/SS (1) OF SECTION 245C IS MADE. THUS , THESE APPLICATION S ABATED BEFORE THE ITSC. 3. DURING THE ASSESSMENT PROCEEDINGS IN THESE CASES, IN RESP ONSE TO THE AOS PROPOSAL TO MAK E ADDITION OF THE INCOME - BROKERAGE ETC, ASSESSEES SUBMITTED THAT NO ADDITION CAN BE MADE MERELY BECAUSE OF THE INCOME DISCLOSED IN THE SAID APPLICATION BEFORE THE ITSC. ACCORDING TO THE ASSESSES, AO MUST HAVE AN INDEPE NDENT INCRIMINATING MATERIAL OR EVIDENCES IN HIS POSSESSION BEFORE ANY ADDITION ON THAT ACCOUNT IS MADE IN SUPPORT OF EARNING OF SUCH INCOME BY THE ASSESSEE. BRINGING OUR ATTENTION TO THE ASSESSMENT ORDER, LD COUNSEL FOR THE A S SESSEES SUBMITTED THAT THE AO DOES NOT POSSESS ANY DOCUMENTARY EVIDENCE IN SUPPORT OF THE ADDITIONS MADE IN THESE NINE ASSESSEES. THEREFORE, LD AR PRAYS FOR THE DELETION OF THE ADDITIONS IN ALL THESE CASES. 4. BRINGING OUR ATTENTION TO THE GUJRATH HIGH COURT JUDGEM E NT IN THE CASE OF MARUTHI FABRICS 47 TAXMAN.COM 298, LD AR SUBMITTED THAT THE HONBLE H IGH C OURT ANALYSED THE PROVISIONS OF SECTION 32L OF THE CENTRAL EXCISE ACT AND BROUGHT ANALOGY OF THE SAME WITH THE PROVISIONS OF SECTION 245 HA(5) OF THE INCOME TAX ACT 61 AND MENTIONE D THAT THE PROVISIONS ARE APPLICABLE TO THE FACTS OF THE PRESENT CASE UNDER THE I T ACT PROVISI ONS. THEREFORE, IT IS THE CASE OF THE ASSESSEES COUNSEL, ALL THESE NINE APPEALS ARE REQUIRED TO BE ALLOWED IN FAVOUR OF THE ASSESSEE AS COVERED CASES BY THE SA ID HONBLE HC OF GUJARATH. 5 5. ON THE CONTRARY , LD DR FOR THE SMC B ENCH RELIED HEAVILY ON THE ORDERS OF THE AO AND THE CIT (A). W ITHOUT CONCEDING ON THE ABSENCE OF ANY INCRIMINATING OR EVIDENCES IN SUPPORT OF THE SAID ADDITIONS OF INCOME IN ALL THESE ASSES SMENTS, LD DR SUBMITTED THAT THE SAID ASSESSEES MADE A STATEMENT ON OATH AND DULY VERIFIE D THE SAME IN THE VERIFICATION COLUMN OF THE APPLICATION BEFORE ITSC. ACCORDING TO LD DR, THESE ASSESSEES CANNOT BE PERMITTED TO RETRACT THE SAID STATEMENTS. IN FACT, AO MISTAKENLY REFERRED TO CERTAIN AFFIDAVITS WHICH WERE NEVER IN EXISTENCE. ACTUALLY, AO MISTOOK THE STATEMENT IN VERIFICATION FOR THE AFFIDAVITS. LD DR ALSO SUBMITTED THAT THE SAID GUJARAT HIGH C OURT JUDGMENT (SUPRA) IS DELIVERED IN THE CONTEXT OF THE CEN TRAL EXCISE PROVISIONS AND THEREFORE, THE SAME IS INAPPLICABLE TO THE PROCEEDINGS UNDER I T PROVISIONS. 6. REPLYING TO THE SAME, LD AR FOR THE ASSESSEE BROUGHT MY ATTENTION TO THE SAID PROVISIONS OF SECTI O N 32L OF C ENTRAL E XCISE ACT AND THE SECTION 245HA (5) OF THE I T ACT AND DEMONSTRATED THA T THE LANGUAGE IS PARA MATERIA AND THEREFORE THE RATIO OF THE SAID JUDGMENT APPLIES TO THE PRESENT CASES UNDER THE I T ACT PROVISIONS. 7. ON HEARING BOTH THE PARTIES WITH REFERENCE ALL THE NINE APPEALS, I FIND THE CORE FACTS ARE IDENTICAL BUT FOR THE FIGURES INVOLVED ARE DIFFERENT . THE PROVISIONS OF SECTION 32L OF C ENTRAL EXCISE ACT ARE PARA MATERIA WITH THE PROVISIONS OF SECTION 245HA OF THE INCOME TAX ACT. THEREFORE, THE RATIO OF THE JUDGMENT (SUPRA) IS APPLICABLE TO THE NINE APPEALS UNDER CONSIDERATION. 245HA (5) FOR THE PURPOSES OF SECTION (2), THE ASSESSING OFFICER, OR AS THE CASE MAY BE, OTHER INCOME TAX AUTHORITY, SH ALL BE ENTITLED TO USE ALL THE MATERIAL AND OTHER INFORMATION PRODUCED BY THE ASSESSEE BEFOR E THE SETTLEMENT COMMISSION OR THE RESULT OF THE INQUIRY HELD OR EVIDENCE RECORDED BY THE SETTLEMENT COMMISSION IN THE COURSE OF THE PROCEEDINGS BEFORE IT, AS SUCH MATERIAL, INFORMATION, INQUIRY AND EVIDENCE HAD BEEN PRODUCED BEFORE THE ASSESSING OFFICER OR OTHER INCOME TAX AUTHORITY OR HELD OR RECORDED BY HIM IN THE COURSE OF THE PROCEEDINGS BEFORE HIM. 8. THE ABOVE PROVISIONS OF SUB - SECTION (5) ARE FOUND TO BE PARA MATERIA WITH THE PROVISIONS OF SECTION 32L OF THE CENTRAL EXCISE ACT. CIT (A) EXTRACTED THE SAID PROVISIONS IN HIS ORDER. THERE IS NO DISPUTE ON THE FACT OF ABETMENT OF THE APPLICATIONS BEFORE THE ITSC IN ALL THESE NINE CASES. FURTHER, THERE IS NO DISPUTE ON THE ABSENCE OF 6 ANY ADDITIONAL INFORMATION OR EVIDENCE SUPPORTING THE ADDITION OF INCO ME OFFERED BY THE ASSESSEE IN THE SAID APPLICATIONS BY NINE ASSESSE E S BEFORE THE ITSC. CONSIDERING THE SAME, I AM OF THE VIEW THAT THE ORDERS OF THE AO AND CIT (A) ARE REQUIRED TO BE REVERSED. CONSEQUENTLY, ALL THE ADDITIONS OF INCOME MADE BY THE AOS MEREL Y RELYING ON THE ASSESSE E S DISCLOSURES IN THE APPLICATION BEFORE THE ITSC STA ND DELETED. ACCOR D I NGLY, THE GROU NDS OF APPEALS IN ALL THESE NIN E APPEALS OF THE LODHA GROUP ARE ALLOWED. 9. IN THE RESULT, THE APPEA LS OF THE NINE ASSESSES ARE ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON 25 TH APRIL, 2017. S D / - (D. KARUNAKARA RAO) ACCOUNTANT MEMBER MUMBAI ; 25.04.2017 . . ./ 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