VINODINI N. PAREKH, MUMBAI V. ACIT 12(1), MUMBAI

ITA 5928/MUM/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 100957 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-08-2015
• Appeal Filed By: Assessee
• Bench Allotted: F
• Next Hearing Date: 18-02-2014
• Assessment Year: 2003-2004
• Appeal Filed On: 24-08-2011
• Court: TRIBUNAL
• Keywords: Opportunity of being heard

Judgement Text

F IN THE INCOME TAX APPELLATE TRIBUNAL F BENCH, MUMBAI BEFORE SHRI D. KARUNAKARA RAO, AM AND SHRI SANJAY GARG, JUDICIAL MEMBER I.T.A. NO.5928/M/2011 (AY: 2003 - 2004) MRS. VINODINI N. PAREKH, FORTUNE BUILDING, 3 RD FLOOR, 568, L.J. ROAD, FIVE GARDENS, MATUNGA (E) MUMBAI - 400 019. / VS. ACIT - 12(1), MUMBAI. ./ PAN : AACPP6300L ( / APPELLANT) .. ( / RESPONDENT ) / APPELLANT BY : SHRI RAJIV KHANDELWAL & MR. NEELKANTH KHANDELWAL / RESPONDENT BY : SHRI G.M. DOSS, DR / DATE OF HEARING : 13.8.2015 / DATE OF PRONOUNCEMENT : 31 .8.2015 / O R D E R PER D. KARUNAKARA RAO, AM: THIS APPEAL FILED BY THE ASSESSEE ON 24.8.2011 IS AGAINST THE ORDER OF THE CIT (A) - 23, MUMBAI DATED 22.7.2011 FOR THE ASSESSMENT YEAR 2003 - 2004 IN CONNECTION WITH THE LEVY OF PENALTY U/S 271D OF THE ACT. AO LEVIED THE PENALTY OF RS. 24,87,067/ - IN CONNECTION WITH THE VIOLATION OF PROVISIONS OF SECTION 269SS OF THE ACT. THIS IS THE SECOND ROUND OF PROCEEDINGS. 2. IN THE FIRST ROUND, TRIBUNAL GAVE A FINDING THAT THERE IS NO NEED TO LEVY PENALTY IN THIS CASE OF TRANSACTIONS BY WAY OF JOURNAL ENTRIES SUBJECTED TO THE DEMONSTRATION OF FACTS BY THE ASSESSEE. THE CONTENTS OF PARA 5 OF THE ORDER OF THE TRIBUNAL VIDE ITA NO.1304/M/2008 (AY 2003 - 2004), DATED 8.7.2009 ARE RELEVANT IN THIS REGARD. 3. IN THE SECOND ROUND, CONSIDERING THE ASSESSEES FAILURE TO DEMONSTRAT E THE ENTRIES FROM THE RECORDS OF THE PARTIES INVOLVED IE SHRI NAVINCHANDA N PAREKH AND M/S CLASSIC CREDIT LTD, AO REPEATED THE LEVY OF PENALTY. ON APPEAL, CIT (A) 2 CONFIRMED THE PENALTY CONFIRMING THE ASSESSEES FAILURE IN THE MATTER. AGGRIEVED WITH THE SAME, ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL FOR THE SECOND ROUND ON THE SAME ISSUE. 4. DURING THE PROCEEDINGS BEFORE US, LD COUNSEL FOR THE ASSESSEE BROUGHT OUR ATTENTION TO PAGES 6 TO 10 OF THE PAPER BOOK AND TRIED TO DEMONSTRATE THAT IT IS THE CASE O F REVERSAL OF THE WRONG ENTRIES. HOWEVER, HE COULD NOT DEMONSTRATE HOW IT IS A WRONG ENTRY TO START WITH. FURTHER, HE COULD NOT DEMONSTRATE THE BACKGROUND AS TO HOW THE EACH AMOUNT OF RS. 13,43,533/ - IS PAYABLE / RECEIVABLE AND WHAT ARE ENTRIES IN THE BO OKS OF ACCOUNT OF SHRI NAVINCHANDA N PAREKH. HOWEVER, HE TRIED TO WIN THE CASE ON THE LEGAL ISSUE THAT JOURNAL ENTRIES ARE OUTSIDE THE SCOPE OF SECTION 269 - SS R.W.S 271D OF THE ACT. BUT THE FACT IS THAT THE ASSESSEE FAILED TO COMPLY WITH THE DIRECTIONS O F THE TRIBUNAL IN THE FIRST ROUND. 5. ON HEARING BOTH THE PARTIES, WE HAVE PERUSED THE DIRECTIONS OF THE TRIBUNAL IN THE FIRST ROUND. FOR THE SAKE OF COMPLETENESS OF THIS ORDER, WE EXTRACT THE RELEVANT LINES FROM THE SAID TRIBUNALS ORDER (SUPRA) AS FOLLO WS: - 5 .IN OUR CONSIDERED VIEW, THE CLAIM OF THE ASSESSEE OUGHT TO HAVE BEEN VERIFIED WITH REFERENCE TO THE RECORDS FO THE YEAR UNDER APPEAL AS WELL AS THE RECORDS OF THE PRECEDING YEAR IN WHICH THE MISTAKE IS CLAIMED TO HAVE BEEN COMMITTED. IN C ASE, THE CLAIM OF THE ASSESSEE IS FOUND TO BE CORRECT, THEN THE PENALTY UNDER SECTION 271D MAY NOT BE ATTRACTED. TAKING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE INTO CONSIDERATION, WE SET ASIDE THE ORDER OF THE CIT (A) AS WELL AS THAT OF A SSESSING OFFICER AND RESTORE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER FOR PURPOSE OF A FRESH DECISION IN ACCORDANCE WITH LAW. 6. ASSESSEE IS UNDER DIRECTION OF THE TRIBUNAL TO DEMONSTRATE THE ENTRIES OF THE PARTIES IE ASSESSEE, SHRI NAVINCHANDA N PAREKH AND M/S. CLASSIC CREDIT LTD FOR ALL THE YEARS INVOLVED. IT IS A FACT THAT THE ASSESSEE HAS NOT SUCCESSFULLY DISCHARGED ITS ONUS. THEREFORE, THE AO LEVIED PENALTY IN THE SECOND ROUND TOO. BEFORE US ALSO, LD COUNSEL FOR THE ASSESSEE C OULD NOT FILE RELEVANT EXTRACT FROM THE BOOKS OF SHRI NAVINCHANDA N PAREKH AND OTHER RELATED CONCERNS. AFTER HEARING THE PARTIES, AND ON PERUSAL OF THE RECORDS, WE FIND THE DIRECTIONS OF THE TRIBUNAL ARE NOT MEANINGFULLY CARRIED. THEREFORE, AS DISCUS SED IN THE COURT, THE MATTERS ARE REMANDED TO THE AO ONE MORE ROUND FOR WANT OF BASIC FACTS AS TO WHAT ARE THE ENTRIES IN THE BOOKS OF ACCOUNTS OF THE PERSONS INVOLVED AND IN ALL RELEVANT YEARS. AO SHALL ALSO BRING THE FACTS RELATING TO THE GENESIS OF THE TRANSACTIONS AS TO HOW AND WHY THE AMOUNTS ARE RECEIVABLE / PAYABLE AND HOW IT CONSTITUTES LOAN / ADVANCE AND HOW THE JOURNAL 3 ENTRIES ARE NOT EXCLUDIBLE FROM THE RIGOURS OF THE LAW. AO SHALL EXAMINE RELEVANT JUDGMENTAL LAWS IN THE MATTER. ACCORDINGLY, WE DIRECT THE AO TO ADJUDICATE THE ISSUE AFRESH AFTER GIVING A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. AO SHALL ALSO ALLOW FRESH EVIDENCE, IF ANY, RELATING TO THE ISSUE UNDER CONSIDERATION. ACCORDINGLY, THE GROUNDS RAISED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED I N T HE OPEN COURT ON 3 1 S T AUGUST, 2015. S D / - S D / - (SANJAY GARG) (D. KARUNAKARA RAO ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; 3 1 .8 .2015 . . ./ OKK , SR. P S / 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