GIRISH PUKHRAJ SHAH, MUMBAI V. ITO WD 13(1)(1), MUMBAI

ITA 5730/MUM/2008

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 7698 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-02-2010
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Next Hearing Date: 02-02-2010
• Assessment Year: 2005-2006
• Appeal Filed On: 11-09-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: P C MAURYA
• Assessee Lawyers: PANKAJ TOPRANI
• Keywords: Unexplained investment; Salary income; Opportunity of being heard; Peak credit; Additional evidence
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH G : MUMBAI BEFORE SHRI D.K. AGARWAL, (JM) AND SHRI R.K. PAND A ,(AM) ITA NO.5730/MUM/2008 ASSESSMENT YEAR : 2005-06 GIRISH PUKHRAJ SHAH PROP. SAKARIA BRASS & HARDWARE 83, NAGDEVI CROSS LANE MUMBAI-400003. ..( APPELLANT ) P.A. NO. (ANGPS 3171 D ) VS. INCOME TAX OFFICER WARD 13(1)(1) MUMBAI. ..( RESPONDENT ) APPELLANT BY : SHRI PANKAJ TOPRANI RESPONDENT BY : SHRI P.C. MAURYA O R D E R PER D.K. AGARWAL (JM). THIS APPEAL PREFERRED BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER DATED 6.6.2008 PASSED BY THE LD. CIT(A) FOR THE ASSESSMENT YEAR 2005-06. 2. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE ASSESSEE A N INDIVIDUAL DERIVES INCOME FROM BUSINESS OF HARDWARE AND ALSO EARNING INCOME FROM SALARY AND OTHER SOURCES. THE RETURN WAS FIL ED DECLARING AN INCOME OF RS.1,91,605/- . DURING THE COURSE OF ASSESSMEN T IT WAS INTERALIA OBSERVED BY THE AO THAT INTIMATION WAS RECEI VED FROM ANNUAL ITA NO.5730/M/08 A.Y: 05-06 2 INFORMATION REPORT THAT DURING THE YEAR ASSESSEE DEPOSI TED CASH RS.16,36,000/- IN THE BANK A/C. WITH KARNATAKA BANK L IMITED, MANGALORE, DAKSHIN. THE ASSESSEE WAS ASKED TO PROVE THE SOURCE OF DEPOSITING THE CASH IN BANK AND OTHER INFORMATION AS PE R FORMAT. IN RESPONSE THE ASSESSEE VIDE LETTER DT.17.11.2007 INTERALI A SUBMITTED THAT : THE ENTRYWISE DETAILS OF EVERY DEPOSITS AND WITHDRAWAL S OF KARNATAKA BANK A/C. HAS BEEN ALREADY FURNISHED TO YOU. I AM PREPARED TO EXPLAIN EVERY ENTRY IN THE BANK ACCOUNT T O YOUR SATISFACTION AS DEPOSITS ARE ALL OFFICIAL AMOUNTS DISCLOSED I N THE INCOME TAX RETURNS FOR WHICH I HAVE ALSO FURNISHED BANK ACCOUNTS , ACCOUNT STATEMENTS, COPY OF RETURNS FILED AND OTHER RELEVANT D OCUMENTS. I ENCLOSE A STATEMENT IN A PARTICULAR FORMAT AS REQUIRED BY YOU GIVING NAME, AMOUNT AND SOURCE AND HOPE THIS MEETS WITH YOUR APPROVAL HOWEVER, THE AO DID NOT ACCEPT THE ASSESSEES EXPLANATION. HE OBSERVED THAT THE STATEMENT DID NOT HAVE ANY AUTHENTI C PROOF OF GENERATION OF CASH. NO REASON WAS CITED FOR CARRYING CASH TO MANGALORE AND DEPOSITING THERE. THE ASSESSEE TRIED TO SA Y THAT THE DEPOSIT OF RS.16,36,000/- WAS FROM CASH AVAILABLE OF RS. 5,46,000/-. THE AO IN THE ABSENCE OF ANY AUTHENTIC DOCUMENT DID NO T ACCEPT THE SAME AND ACCORDINGLY TREATED THE ENTIRE AMOUNT OF RS.16 ,36,000/- AS UNEXPLAINED INVESTMENT U/S.69A OF THE INCOME TAX ACT, 1 961(THE ACT). THE AO AFTER MAKING OTHER ADDITION OF LONG TERM CAPI TAL GAIN ITA NO.5730/M/08 A.Y: 05-06 3 RS.3,65,359/-, COMPLETED THE ASSESSMENT AT AN INCOME OF RS.21,92,960/- VIDE ORDER DATED 11.12.2007 PASSED U/S. 143(3) OF THE ACT. ON APPEAL, THE LD. CIT(A) WHILE AGREEING WITH THE REASONING GIVEN BY THE AO ALLOWED THE BENEFIT OF DOUBT TO THE ASSESSE E AND ACCORDINGLY CONFIRMED THE ADDITION OF THE PEAK CREDIT OF RS.5,46,000/- AND ACCORDINGLY PARTLY ALLOWED THE APPEAL. 3. BEING AGGRIEVED BY THE ORDER OF THE LD. CIT(A) T HE ASSESSEE IS IN APPEAL BEFORE US CHALLENGING THE SUSTENANCE OF ADDITION OF RS.5,46,000/- U/S.69A OF THE ACT. 4. AT THE TIME OF HEARING, AT THE OUTSET, THE LD. CO UNSEL FOR THE ASSESSEE SUBMITS THAT THE ASSESSEE HAS FILED A PETITION BEFOR E THE TRIBUNAL FOR ADMISSION OF ADDITIONAL EVIDENCE UNDER R ULE-29 WHICH READS AS UNDER: 1. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER HAD CALLED UPON THE APPELLANT TO PREPARE THE ANALYSIS OF HIS CASH AND BANK ACCOUNTS AS ALSO OF HIS FAMILY MEMBERS SO AS TO EXPLAIN THE MOVEMENT OF FUNDS FROM THE ACCOUNT OF HIS FAMILY MEMBERS TO HIS ACCOUNTS TO EXPLAIN THE SOURCE OF DEPOSIT IN KARNATAKA BANK LTD. MANGALORE. 2. THE DETAILS BEING VOLUMINOUS, THE SAME COULD NOT PREPARED DURING THE COURSE OF ASSESSMENT AND APPEAL PROCEEDINGS. NOW THE SAID DETAILS HAVE BEEN PREPARED. 3. THE ENCLOSED 14 DOCUMENTS ARE SUCH SUMMARIES OF BANK AND CASH ACCOUNTS OF THE APPELLANT AND HIS FAMILY MEMBERS WHICH DULY EXPLAIN THE DEPOSIT OF CASH OF RS.16,36,000/- IN THE APPELLANTS BANK ACCOUNT WITH KARNATAKA BANK LIMITED, MANGALORE. ITA NO.5730/M/08 A.Y: 05-06 4 4. IT IS REQUESTED THAT THE ENCLOSED ADDITIONAL EVIDENCES BE ADMITTED BY THE TRIBUNAL UNDER RULE 29 OF THE APPELLATE TRIBUNAL RULES. 5. THE APPELLANT HAS NO OBJECTION IF THE MATTER IS RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR T HE VERIFICATION OF ENCLOSED DOCUMENTS AFTER THEIR ADMISSIONS BY THE TRIBUNAL. 6. THE APPELLANT RESPECTFULLY PRAYS THAT IF THE ABOVE ADDITIONAL EVIDENCE IS NOT ADMITTED BY THE TRIBUNAL A GRAVE AND IRREPARABLE LOSS WILL BE SUFFERED BY TH E APPELLANT. IN SUPPORT HE ALSO PLACED ON RECORD THE FOLLOWING DOCUM ENTS 1 GIRISH P. SHAH CASH BOOK SAKARIA BRASS & HARDWARES 2 GIRISH P. SHAH UNION BANK OF INDIA A/C.- SAKARIA B RASS & HARDWARES 3 GIRISH P. SHAH HDFC BANK A/C. - SAKARIA BRASS & HARDW ARES 4 GIRISH P. SHAH HUF CASH BOOK 5 GIRISH P. SHAH HUF VAISHYA SAHAKARIA BANK A/C. 6 GIRISH P. SHAH HUF KARNATAKA BANK A/C. 7 HULASI GIRISH SHAH CASH BOOK 8 HULASI GIRISH SHAH - VAISHYA SAHAKARIA BANK A/C. 9 HULASI GIRISH SHAH KARANATAKA BANK A/C. 10 JITENDRA P. SHAH CASH BOOK SAKARIA & SONS 11 JITENDRA P. SHAH HDFC BANK A/C. SAKARIA & SONS 12 JITENDRA P. SHAH UNION BANK OF INDIA A/C. SAKARIA & SONS 13 GIRISH P. SHAH /JITENDRA P. SHAH / HULASI SHAH / GIRISH P. SHAH HUF KARNATAKA BANK A/C. 14 GIRISH P. SHAH /JITENDRA P. SHAH /HULASHI G. SHAH / GIRISH P. SHAH HUF CASH A/C. IN THE LIGHT OF THE ABOVE HE SUBMITS THAT THE ABOVE ADDITIONAL EVIDENCE MAY BE ADMITTED AS PROVIDED UNDER RULE-29 OF THE APP ELLATE TRIBUNAL RULES AND HE HAS NO OBJECTION IF THE MATTER IS RESTORED TO THE FILE OF THE AO FOR THE VERIFICATION OF THE ENCLOSED DOCUMENTS AND TO PASS A FRESH ORDER. ITA NO.5730/M/08 A.Y: 05-06 5 5. ON THE OTHER HAND, THE LD. DR WHILE RELYING ON T HE ORDER OF THE AO AND CIT(A) SUBMITS THAT HE HAS NO OBJECTION IF THE I SSUE IS RESTORED BACK TO THE FILE OF THE AO. 6. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE RI VAL PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIN D THAT THERE IS NO DISPUTE THAT THE ASSESSEE HAS FILED HIS EXPLANATION TO P ROVE THE NATURE AND SOURCE OF THE DEPOSIT IN THE BANK ACCOUNT VIDE HIS L ETTER DATED 17.11.2007. WE FURTHER FIND FROM THE READING OF THE ASSESSMENT ORDER THAT THE AO WHILE CONSIDERING THE SAME HAS NOT RAISED AN Y FURTHER QUERY OR EXPLANATION FROM THE ASSESSEE. IN OTHER WORD S THE A.O WITHOUT GIVING FURTHER OPPORTUNITY OF BEING HEARD T O THE ASSESSEE HAS ADDED THE AMOUNT OF RS.16,36,000/- IN THE INCOME OF T HE ASSESSEE. THIS BEING SO AND KEEPING IN VIEW THAT THE AFORESAID A DDITIONAL EVIDENCE, SUPPORTED BY DOCUMENTARY PROOF WHICH WAS NOT SUBMITTED BY THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDING OR APPELLATE PROCEEDING GOES TO THE ROOT OF THE MATTER, WE, IN THE INTEREST OF JUSTICE, ADMIT THE ADDITIONAL EVIDENCE AS PROVIDED UNDER RULE-29 OF THE APPELLATE TRIBUNAL RULE, 1963 AND SEND BACK THE MATTER TO THE FILE OF THE AO WHO SHALL EXAMINE THE SAME AFRESH AND ACCORDIN G TO LAW AFTER PROVIDING REASONABLE OPPORTUNITY OF BEING HEA RD TO THE ASSESSEE. ITA NO.5730/M/08 A.Y: 05-06 6 THE GROUND TAKEN BY THE ASSESSEE IS THEREFORE, PARTLY A LLOWED FOR STATISTICAL PURPOSES. 7. IN THE RESULT ASSESSEES APPEAL STANDS PARTLY ALLOWED F OR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 12.2.2010. SD/- SD/- ( R.K. PANDA ) ( D.K. AGARWAL ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 12.2.2010. 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. DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 2.2.10 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 3.2.10 SR.PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6. KEPT FOR PRONOUNCEMENT ON 12.2.10 SR.PS/PS 7. FILE SENT TO THE BENCH CLERK 15.2.10 SR.PS/PS 8 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER