AJIT CHOKSHI, MUMBAI V. DCIT RG 8(1), MUMBAI

ITA 5739/MUM/2013

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3000 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 11 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-09-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 08-09-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 19-09-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A RAMCHANDRAN
• Keywords: Opportunity of being heard; Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH A, MUMBAI BEFORE SHRI G.S.PANNU, ACCOUNTANT MEMBER AND SHRI RAMLAL NEGI, JUDICIAL MEMBER ITA NO. 5739/MUM/2013 (ASSESSMENT YEAR : 2008-09) SHRI AJIT CHOKSI, CHOKSI COMPOUND, SAKI VIHAR ROAD, POWAI, MUMBAI 400 072. PAN:AAAPC 8346B ...... APPELLANT VS. THE DCIT, RANGE -8(1), AAYKAR BHAVAN,M.K.ROAD, MUMBAI 400 020 .... RESPONDENT APPELLANT BY : SHRI NARESH KUMAR RESPONDENT BY : SHRI A RAMCHANDRAN DATE OF HEARING : 08/09/2016 DATE OF PRONOUNCEMENT : 16/09/2016 ORDER PER G.S.PANNU,A.M: THE CAPTIONED APPEAL FILED BY THE ASSESSEE PERTAI NING TO ASSESSMENT YEAR 2008-09 IS DIRECTED AGAINST AN ORD ER PASSED BY CIT(A)- 16 MUMBAI DATED 24/06/2013 WHICH IN TURN ARISES OUT OF AN ORDER PASSED BY THE ASSESSING OFFICER UNDER SECTION 143(3 ) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) DATED 16/11/2010. 2. IN BRIEF, THE RELEVANT FACTS ARE THAT THE ASSESS EE IS AN INDIVIDUAL DERIVING INCOME FROM SALARIES, BEING DIRECTOR OF CP L SWITCHES PVT. LTD. 2 ITA NO. 5739/MUM/2013 (ASSESSMENT YEAR : 2008-09) AND INCOME FROM OTHER SOURCES. IN THE COURSE OF A SSESSMENT PROCEEDINGS, ASSESSEE WAS CALLED UPON TO FURNISH BA LANCE SHEET AS ON 31/3/2008 AND IN RESPONSE ASSESSEE FURNISHED A BALA NCE SHEET, WHEREIN CAPITAL ACCOUNT WAS SHOWN ON THE LIABILITIES SIDE A T RS.2,01,59,792/-. IT IS NOTICED BY THE ASSESSING OFFICER THAT SUBSEQUENT LY ASSESSEE FILED ANOTHER BALANCE SHEET AS ON 31/3/2008, WHEREIN CAPI TAL ACCOUNT WAS SHOWN AT RS.2,07,59,338/-, HEREBY SHOWING A DIFFERE NCE OF RS.5,59,546/- . THE ASSESSING OFFICER NOTED THAT IN THE ABSENCE OF ANY RECONCILIATION, THE DIFFERENCE WAS LIABLE TO BE ASSESSED AS UNEXPLA INED INCOME, ACCORDINGLY, HE ADDED THE DIFFERENCE OF RS.5,99,546 /- TO THE RETURNED INCOME. THIS ACTION OF THE ASSESSING OFFICER HAS S INCE BEEN AFFIRMED BY THE CIT(A), AGAINST WHICH THE ASSESSEE IS IN FURTHE R APPEAL BEFORE US. 3. BEFORE US, THE SHORT PLEA RAISED BY THE LD. REPR ESENTATIVE FOR THE ASSESSEE IS TO THE EFFECT THAT THE CIT(A) HAS REJEC TED THE PLEAS OF THE ASSESSEE ON INSUFFICIENT REASONS. IT WAS POINTED O UT THAT ASSESSEE HAD FURNISHED RECONCILIATION BETWEEN THE DIFFERENCE IN THE CAPITAL ACCOUNT BALANCES IN THE TWO BALANCE SHEETS. HOWEVER, CIT(A ) DID NOT GIVE COGNISANCE OF SUCH RECONCILIATION FOR A FEEBLE REA SON THAT IT WAS A NEW EVIDENCE. LD. REPRESENTATIVE FOR THE ASSESSEE POIN TED OUT THAT THE DIFFERENCE WAS RECONCILED AND EXCEPT TO THE EXTENT OF RS.64,922/-, THE DIFFERENCE DID NOT AFFECT THE INCOME STATEMENT AND , THEREFORE, THE SAME SHOULD HAVE BEEN ACCEPTED. IT IS ALSO POINTED OUT THAT ASSESSEE HAD EXPLAINED THAT THE DIFFERENCE HAD ARISEN ON ACC OUNT OF POSTING ERRORS COMMITTED BY THE ACCOUNTANT OF THE ASSESSEE AND THAT THE ENTIRE RECONCILIATION WAS VERIFIABLE FROM RECORD. IN THIS CONTEXT, OUR ATTENTION WAS DRAWN TO THE PAPER BOOK WHEREIN IS PLACED A COP Y OF SUCH 3 ITA NO. 5739/MUM/2013 (ASSESSMENT YEAR : 2008-09) RECONCILIATION AND THE NOTES THEREON AT PAGES 2 TO 5 OF THE PAPER BOOK. LD. REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THA T ASSESSEE WOULD NOT HAVE ANY GRIEVANCE, EVEN IF, THE MATTER IS REST ORED BACK TO THE ASSESSING OFFICER FOR APPROPRIATE VERIFICATION OF T HE RECONCILIATION. 4. ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENTATI VE POINTED OUT THAT THE RECONCILIATION STATEMENT WAS NOT FURNISHED BEFORE THE ASSESSING OFFICER AND IN THAT LIGHT THE CIT(A) CON SIDERED IT TO BE AN ADDITIONAL EVIDENCE. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. THE M ATERIAL ON RECORD SHOWS THAT DURING THE COURSE OF ASSESSMENT P ROCEEDINGS, ASSESSEE FURNISHED TWO SETS OF BALANCE SHEETS AS ON 31/3/2008, WHEREIN THERE WERE DIFFERENCES ON VARIOUS ACCOUNTS. BE THA T AS IT MAY, THE ONLY POINT FOR OUR CONSIDERATION IS THE DIFFERENCE IN TH E CAPITAL ACCOUNT APPEARING IN THE TWO BALANCE SHEETS. SUCH DIFFEREN CE WAS TO THE TUNE OF RS.5,99,547/-, WHICH HAS BEEN CONSIDERED AS AN U NEXPLAINED INCOME. IN THIS CONTEXT, ASSESSEE HAS CONCEDED IN THE GRO UNDS OF APPEAL ITSELF THAT A SUM OF RS.64,922/- IS ASSESSABLE AS INCOME. FOR THE BALANCE OF THE AMOUNT, IT HAS BEEN CONTENDED THAT THE DIFFEREN CE DOES NOT HAVE AN IMPACT ON THE ASSESSABLE INCOME AS THE SAME IS O N ACCOUNT OF POSTING ERRORS. IT IS POINTED OUT THAT CERTAIN ENT RIES HAD BEEN WRONGLY MADE IN THE BOOKS OF ACCOUNT WHICH HAVE BEEN CORREC TED IN THE SECOND BALANCE SHEET FILED DURING THE COURSE OF ASSESSMENT PROCEEDINGS. IN THIS CONTEXT, WE HAVE ALSO PERUSED THE MATERIAL WHI CH WAS BEFORE THE CIT(A), WHEREIN ASSESSEE HAS CANVASSED THAT THE DIF FERENCE, EXCEPT RS.64,922/-, DOES NOT IMPACT THE INCOME ASSESSABLE. SO, HOWEVER, IN 4 ITA NO. 5739/MUM/2013 (ASSESSMENT YEAR : 2008-09) THE ABSENCE OF ANY VERIFICATION OF THE RECONCILIATI ON FURNISHED BY THE ASSESSEE ITSELF, WE DEEM IT FIT AND PROPER TO RESTO RE THE MATTER TO THE FILE OF THE ASSESSING OFFICER. ACCORDINGLY, THE M ATTER IS SET-ASIDE TO THE FILE OF ASSESSING OFFICER FOR VERIFICATION OF THE R ECONCILIATION FURNISHED BY THE ASSESSEE AND THEREAFTER PASS AN ORDER AFRESH ON THIS LIMITED ASPECT. NEEDLESS TO MENTION, THE ASSESSING OFFICER SHALL PR OVIDE A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE BEFORE P ASSING AN ORDER AFRESH ON THE AFORESAID LIMITED ASPECT. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES, AS ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 16/09/2016 SD/- SD/- (RAMLAL NEGI) (G.S. PANNU) JUDICIAL MEMBER ACCOCUNTANT MEMBER MUMBAI, DATED 16/09/2016 VM , 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. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI