EZRA VICTOR ABOODY, MUMBAI V. ASST CIT 12(2), MUMBAI

ITA 5942/MUM/2012

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 1476 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-12-2016
• Appeal Filed By: Assessee
• Bench Allotted: E
• Next Hearing Date: 08-06-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 28-09-2012
• Court: TRIBUNAL
• Department Lawyers: MRS ARJU GARODIA
• Keywords: Unexplained cash credit; Unexplained expenditure; Business income; Principle of natural justice; Corroborative evidences; Tax effect; Reassessment proceedings
• Section: 69C; 133A; 147; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E, MUMBAI BEFORE SHRI MAHAVIR SINGH (JUDICIAL MEMBER) AND SHRI ASHWANI TANEJA (ACCOUNTANT MEMBER) I.T.A. NO.5942/MUM/2012 - 2007-08 I.T.A. NO.5941/MUM/2012 - 2006-07 I.T.A. NO.5940/MUM/2012 - 2005-06 I.T.A. NO.5939/MUM/2012 - 2004-05 I.T.A. NO.5929/MUM/2012 - 2008-09 I.T.A. NO.5943/MUM/2012 - 2008-09 MR. EZRA VICTOR ABOODY COMMON WEALTH EDUCATION FOUNDATION, 24, DEVIDAS MANSION 2 ND FLOOR, BEHIND TAJ MAHAL HOTEL APOLLO BUNDER, MUMBAI 400 039. VS THE ACIT 12(2), MUMBAI PAN : AECPA0757L (APPELLANT) (RESPONDENT) I.T.A. NO.6203/MUM/2012 - 2007-08 I.T.A. NO.6204/MUM/2012 - 2006-07 THE ACIT 12(2), MUMBAI VS MR. EZRA VICTOR ABOODY COMMON WEALTH EDUCATION FOUNDATION, 24, DEVIDAS MANSION 2 ND FLOOR, BEHIND TAJ MAHAL HOTEL APOLLO BUNDER, MUMBAI 400 039. ASSESSEE BY SHRI HIRO RAI REVENUE BY MRS. ARJU GARODIA DATE OF HEARING : 23-11-2016 DATE OF ORDER : 21 -12-2016 2 EZRA VICTOR O R D E R PER ASHWANI TANEJA, AM: THESE APPEALS PERTAIN TO THE SAME ASSESSEE INVOLVI NG IDENTICAL ISSUES, THEREFORE, THESE WERE HEARD TOGETHER AND AR E DISPOSED OF BY THIS COMMON ORDER. 2. FIRST, WE SHALL TAKE UP ASSESSEES APPEAL IN ITA NO.5929/MUM/2012 FILED AGAINST THE ORDER OF THE LD.CIT(A)-23, MUMBAI DATED 27-07-2012 AGAINST THE ASSESSMENT ORDER OF THE AO U/S 144 R.W. S. 147 DATED 30-12- 2010 FOR A. Y. 2003-04 ON THE FOLLOWING GROUNDS: 1. 'WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN DELETING THE DISALLOWANCE OF TH E MAINTENANCE CHARGES OF RS. 7,65,000/- BY OBSERVING THAT THE ASS ESSING OFFICER HAS NOT GIVEN ANY REASONS FOR SUCH DISALLOWANCE WIT HOUT APPRECIATING THE FACT THAT THE ASSESSING OFFICER WH ILE MAKING THE DISALLOWANCE CLEARLY STATED THAT THE ASSESSEE DID N OT PRODUCE ANY SUPPORTING EVIDENCE IN RESPECT OF EXPENDITURE D ISALLOWED AND ALSO THE FACT THAT REGULAR BOOKS OF ACCOUNTS WE RE NOT FOUND TO BE MAINTAINED. ' 2. 'WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE C ASE, THE LD. CIT(A) HAS ERRED IN DELETING THE DISALLOWANCE ON AC COUNT OF MISCELLANEOUS EXPENSES BY OBSERVING THAT THERE HAS TO BE SOME EXPENDITURE FOR EARNING THE RECEIPTS SHOWN BY THE A SSESSEE, WITHOUT APPRECIATING THE FACT THAT THE ASSESSING OF FICER HAS ALREADY ALLOWED EXPENDITURE OF RS.13,24,282I- OUT O F TOTAL BUSINESS RECEIPTS OF RS. 24, 95, 000/-. 3. 'WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE C ASE, THE LD. CIT(A) ERRED IN GIVING RELIEF OF RS. 7,46,456/- OUT OF ADDITION OF RS.27,56,520/- AS UNEXPLAINED BROUGHT FORWARD CAPIT AL BALANCE WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE HAS FAILED TO FILE THE REGULAR RETURNS OF INCOME FROM A. Y.2002-03 ONW ARDS AND THUS THERE IS NO EVIDENCE TO INCREASE IN CLOSING CA PITAL FROM 3 EZRA VICTOR RS.20,10,064/- AS ON 31.03.2001 TO RS.27, 56, 064/- AS ON 01.04.2002.' 4. 'WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE C ASE, THE LD. CIT(A) HAS ERRED IN FACTS OF CASE AND IN LAW IN DEL ETING THE ADDITION OF RS. 15,00,000/- AS UNEXPLAINED CASH CRE DIT WHEN THE IDENTITY, CREDITWORTHINESS AND GENUINENESS OF THE T RANSACTIONS WHICH ARE BASIC REQUIREMENTS TO ALLOW INTRODUCTION OF CASH IN THE BOOKS OF ACCOUNTS REMAINED UNCOMPLIED WITH. 5. 'THE APPELLANT PRAYS THAT THE ORDER OF THE A.O. SHOULD BE RESTORED AND ORDER OF THE CIT(A) SHOULD BE SET ASID E.' 3. GROUNDS 1 & 2: IN THESE GROUNDS, THE ASSESSEE HAS CHALLENGED THE ACTION OF LOWER AUTHORITIES IN REJECTING THE BOOKS OF ACCOUNT AND IN NOT ALLOWING THE ENTIRE EXPENSES CLAIMED BY THE ASSESSE E AS DEDUCTION. 4. THE BRIEF BACKGROUND OF THIS CASE IS THAT ASSESSEE IS A PROPRIETOR OF M/S COMMON WEALTH EDUCATION FOUNDATION AND WAS ENGA GED DURING THE YEAR IN THE BUSINESS OF PROVIDING PRIVATE COACHING FOR VARIOUS COMPETITIVE EXAMINATIONS, SUCH AS GRE, GSAT AND GMAT, ETC. ASS ESSEE HAD NOT FILED ANY RETURN U/S 139(1) OF THE ACT. SUBSEQUENTLY, SU RVEY PROCEEDINGS U/S 133A WAS CARRIED OUT AT THE PREMISES OF THE ASSESSE E. THEREAFTER, ASSESSEE FILED RETURN, IN RESPONSE TO NOTICE U/S 14 8. DURING THE COURSE OF SURVEY PROCEEDINGS, IT WAS NOTED BY THE AO THAT NO RECORDS WERE METICULOUSLY MAINTAINED BY THE ASSESSEE AND, THEREF ORE, HE REJECTED THE BOOKS OF ACCOUNT AND FULLY DISALLOWED THE EXPENSES INCURRED ON INTERIOR WORK, MAINTENANCE, POSSESSION CHARGES, LEGAL EXPENS ES AND LEAVE AND LICENCE. HOWEVER, HE ACCEPTED THE GROSS RECEIPTS ( I.E. TURNOVER) AS WERE SHOWN BY THE ASSESSEE. 5. IN THE APPEAL BEFORE LD. CIT(A), THE ASSESSEE FURNI SHED VARIOUS DETAILS AND DOCUMENTARY EVIDENCES IN SUPPORT OF THE EXPENSES INCURRED BY THE ASSESSEE. BUT, THE LD. CIT(A) WAS PARTLY SATIS FIED WITH THE DETAILS AND 4 EZRA VICTOR EVIDENCES AND THEREFORE, RELIEF WAS GIVEN EQUIVALEN T TO 25% OF THE EXPENSES CLAIMED BY THE ASSESSEE. 6. DURING THE COURSE OF HEARING BEFORE US, IT WAS FAIR LY SUBMITTED BY THE LD. COUNSEL THAT THE LIMITED PRAYER WITH REGARD TO THESE GROUNDS WAS THAT RELIEF PROVIDED AT 25% WAS TOO LITTLE; THEREFO RE, IT SHOULD BE SUITABLY INCREASED. 7. PER CONTRA, THE LD. DR WAS ALSO FAIR IN SUBMITTING THAT SOME MORE RELIEF CAN BE PROVIDED TO THE ASSESSEE AND IT CAN B E INCREASED TO SAY 50% OF IMPUGNED EXPENSES. 8. WE HAVE GONE THROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE AND FIND THAT DISALLOWING 100% OF THE EXPENSES WAS NOT JUSTIFIED ON THE PART OF THE AO ESPECIALLY WHEN GROSS RECEIPTS WERE ACCEPTED BY THE AO AS IT IS. WE ALSO FIND THAT AD-HOC ALLOWANCE @25% IS ON THE L OWER SIDE. THUS, AFTER TAKING INTO ACCOUNT ALL THE FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND IT APPROPRIATE TO ALLOW THE EXPENSES @50% INSTEAD OF 2 5% ALLOWED BY THE LD. CIT(A). THUS, THE ORDER OF LD. CIT(A) IS MODIF IED TO THE EXTENT THAT THE AO IS DIRECTED TO ALLOW 50% OF THE CLAIM IN RESPECT OF EXPENSES AS HAVE BEEN DIRECTED TO BE ALLOWED BY THE LD.CIT(A). THE REMAINING PORTION OF THE ORDER OF LD. CIT(A) REMAINS SAME AS FAR AS THES E GROUNDS ARE CONCERNED. AS A RESULT, GROUNDS 1 & 2 ARE PARTLY A LLOWED. 9. GROUND 3 : IN THIS GROUND, THE ASSESSEE HAS CHALLENGED THE ADDITION OF RS.50 LACS AS UNEXPLAINED EXPENDITURE M ADE BY THE LOWER AUTHORITIES. 10. IN THIS REGARD, THE BRIEF BACKGROUND IS THAT THE AS SESSEE WAS HAVING SOME SERIOUS DISPUTES WITH HIS LANDLORDS AND, THERE FORE, WITH A VIEW TO SORT OUT THE DISPUTE, HE TOOK HELP OF A LOCAL POLIT ICIAN, VIZ. SHRI ARUN GUJARATHI. DURING THE COURSE OF SURVEY PROCEEDINGS , THE AO FOUND A LETTER 5 EZRA VICTOR DATED NIL WRITTEN BY THE ASSESSEE TO SHRI ARUN GUJA RATHI. ACCORDING TO THE AO, THE TEXT OF THE SAID LETTER INDICATED THAT ASSE SSEE HAD INCURRED AN AMOUNT OF RS.1.50 CRORES TOWARDS RENOVATION OF THE PREMISES. THE ASSESSEE ACCEPTED THE FACT THAT THE SAID LETTER WAS WRITTEN BY HIM. ACCORDINGLY, AO ASKED THE ASSESSEE TO JUSTIFY THE S OURCES OF EXPENSES INCURRED. THE AO WAS NOT SATISFIED WITH THE EXPLAN ATION PUT FORTH BY THE ASSESSEE AND, THEREFORE, IT WAS HELD BY HIM THAT TH E ASSESSEE OFFERED NO LEGITIMATE EXPLANATION AND HAS NOT FILED ANY SUPPOR TING EVIDENCES / CONFIRMATION ABOUT THE SOURCE OF SUCH EXPENDITURE. UNDER THESE CIRCUMSTANCES, THE ENTIRE AMOUNT WAS ADDED U/S 69C AS UNEXPLAINED EXPENDITURE. ADDITION OF RS.50 LACS WAS MADE IN AY 2003-04 AND BALANCE RS. 1 CRORE WAS ADDED IN AY 2004-05. 11. DURING THE COURSE OF APPEAL BEFORE THE LD. CIT(A), IT WAS SUBMITTED THAT THE SAID LETTER WAS WRITTEN TO SHRI ARUN GUJAR ATHI, WHO WAS A POLITICIAN BELONGING TO NCP FOR SEEKING HELP. THE FIGURES MENTIONED THEREIN WERE ROUNDED SUMS AND NOT EXACT FIGURES T AKEN FROM ACCOUNTS. IT WAS FURTHER SUBMITTED THAT AO HAD WRONGLY UNDERS TOOD THE MEANING OF THE LETTER, WHEREIN AO HAS INFERRED THAT AGGREGATE AMOUNT OF RS.1.50 CRORES WAS INCURRED WHEREAS EVEN IF THE LETTER IS T AKEN AS FULLY CORRECT, THE TOTAL AMOUNT OF RS.1 CRORE WAS STATED TO BE INCURRE D SINCE THE AMOUNT OF RS.1 CRORE MENTIONED IN LATTER PORTION OF THE LETTE R INCLUDED THE FIRST MENTIONED AMOUNT OF RS.50 LAKHS. 12. IN ADDITION TO ABOVE, THE ASSESSEE SUBMITTED BEFORE THE CIT(A), A STATEMENT OF DETAILS COMPILED FROM THE ACCOUNTS AND DOCUMENTS WHICH WERE SUBMITTED TO THE AO. ON THE BASIS OF THESE DO CUMENTS, IT WAS CONTENDED THAT FINAL ACCOUNTS AND DOCUMENTS AVAILAB LE BEFORE THE AO REVEALS THAT THE ASSESSEE HAD ALREADY DISCLOSED AN AMOUNT OF 6 EZRA VICTOR RS.1,25,21,500. IT WAS SUBMITTED THAT IF THE LETTE R IS READ CORRECTLY, THEN IT CONVEYS THAT ASSESSEE HAD CLAIMED TO HAVE SPENT AN AGGREGATE AMOUNT OF RS.1 CRORE ON THE RENOVATION OF OFFICE PREMISES. T HUS, NO FURTHER ADDITION CAN BE MADE. BUT, THE LD. CIT(A) WAS NOT SATISFIED WITH THE ARGUMENTS OF THE ASSESSEE AND, THEREFORE, ENTIRE ADDITION MADE B Y THE AO WAS CONFIRMED. 13. DURING THE COURSE OF HEARING BEFORE US, THE LD. COU NSEL OF THE ASSESSEE HAS VEHEMENTLY CONTESTED THE ADDITION MADE BY THE LOWER AUTHORITIES. OUR ATTENTION WAS DRAWN UPON THE LETT ER WRITTEN TO SHRI ARUN GUJARATHI AND CONTENDED THAT IT WAS A LETTER WRITTE N TO A LOCAL POLITICIAN SEEKING HELP IN DISTRESS. UNDER SUCH A SITUATION, THE ASSESSEE NARRATES THE FACTS IN SUCH A MANNER SO AS TO SEEK MAXIMUM HELP. FURTHER, THE FIGURES MENTIONED IN THE LETTER WERE IN ROUND ESTIMATES. F URTHER, IN ANY CASE, PERUSAL OF THE LETTER REVEALS THAT AGGREGATE SUM OF RS.1 CRORE ONLY HAS BEEN SPENT BY THE ASSESSEE. THE LOWER AUTHORITIES HAVE WRONGLY ADDED RS.50 LAKHS AND ONE CORE AND MADE ADDITION OF THE A GGREGATE AMOUNT OF RS.1.5 CRORES WHEREAS THE SECOND AMOUNT OF RS.1 CRO RE INCLUDES THE FIRST FIGURE OF RS.50 LAKHS. UNDER THESE CIRCUMSTANCES, THE ASSESSEE HAS ALREADY DISCLOSED A SUM OF RS.1.25 CRORES WHICH IS NOT DISP UTED BY THE LOWER AUTHORITIES. THEREFORE, THERE WAS NO FURTHER POSSI BILITY OF ANY ADDITION. IT WAS AGAIN RE-EMPHASISED THAT THIS LETTER CANNOT BE TAKEN AS SACROSANCT TO BE USED AGAINST THE ASSESSEE IN ABSENCE OF ANY OTHE R CORROBORATING EVIDENCE. IT WAS SUBMITTED THAT THE LOWER AUTHORIT IES HAVE MADE THIS ADDITION IN A HIGHLY UNJUSTIFIED MANNER AND IN VIOL ATION OF PRINCIPLES OF NATURAL JUSTICE. OUR ATTENTION WAS ALSO DRAWN ON P AGE 13 OF ORDER OF LD. CIT(A) WHEREIN IT IS CLEARLY COMING OUT THAT AN AGG REGATE AMOUNT OF RS.1,25,21,500 HAS BEEN DISCLOSED BY THE ASSESSEE I N HIS BOOKS OF ACCOUNT. 7 EZRA VICTOR THUS, TO THAT EXTENT, THE EXPENDITURE CAN BE SAID T O BE MADE FROM DISCLOSED SOURCES AND NO ADDITION CAN BE MADE UNDER ANY CIRCUMSTANCE. 14. PER CONTRA, THE LD. DR SUBMITTED THAT THIS LETTER H AS NEVER BEEN REJECTED OR RETRACTED BY THE ASSESSEE. FURTHER, TH E AFORESAID AMOUNT OF RS.1,25,21,500 HAS NOT BEEN PROVED TO BE FROM DISCL OSED SOURCES BY THE ASSESSEE. THE AO AND THE LD. CIT(A) COULD NOT VERI FY THE FACTS PROPERLY SINCE THE ENTIRE ADDITION OF RS.1.50 CRORES WAS MAD E ON THE BASIS OF THE SAID LETTER. 15. WE HAVE GONE THROUGH THE FACTS OF THE CASE. IT IS AN ADMITTED FACT THAT THE SAID LETTER WAS WRITTEN BY THE ASSESSEE AT THE TIME OF DISTRESS WHEN HE WAS IN DIRE NEED OF HELP. IT IS ALSO AN AD MITTED FACT THAT THE LETTER WAS WRITTEN TO A LOCAL POLITICIAN FOR SEEKING REQUI SITE HELP. IT IS ALSO CLEAR FROM THE PERUSAL OF THE LETTER THAT NO PRECISE FACT S AND FIGURES HAVE BEEN MENTIONED WITH REGARD TO INCURRING OF THE EXPENDITU RE. TWO FIGURES HAVE BEEN CASUALLY MENTIONED AT PARAS 8 AND 9 OF THE LET TER FOR RS.50 LAKHS AND RS.1 CRORE RESPECTIVELY. IN OUR VIEW, ON THE BASIS OF THIS LETTER, NO PRECISE FACTS CAN BE ASCERTAINED. THE POSSIBILITY OF INCRE ASING OR MAGNIFYING THE FIGURES ALSO CANNOT BE RULED OUT SINCE THE ASSESSEE WAS IN DIRE NEED OF MAXIMUM HELP. IN ANY CASE, IN OUR CONSIDERED VIEW, NO FINAL ACTION CAN BE TAKEN AGAINST THE ASSESSEE SOLELY ON THE BASIS OF T HIS LETTER AS FAR AS DETERMINATION OF HIS TAXABLE INCOME IS CONCERNED. ON THE OTHER HAND, IT HAS BEEN CONTENDED THAT A SUM OF RS.1,25,21,500/- H AS ALREADY BEEN DISCLOSED BY THE ASSESSEE IN ITS BOOKS OF ACCOUNT. THIS AMOUNT IS QUITE CLOSE TO THE FIGURES MENTIONED IN THE LETTER. UNDE R THESE, CIRCUMSTANCES, IN OUR CONSIDERED VIEW, IN CASE THE ASSESSEE IS ABL E TO SATISFY THE AO THAT THE AFORESAID AMOUNT HAS ALREADY BEEN DISCLOSED IN THE BOOKS OF ACCOUNT, THEN NO FURTHER ADDITION IS REQUIRED TO BE MADE IN THE HANDS OF THE 8 EZRA VICTOR ASSESSEE. THUS, KEEPING IN VIEW THE FACTS AND CIRC UMSTANCES OF THE CASE, WE FIND IT APPROPRIATE TO SEND THIS ISSUE BACK TO T HE FILE OF THE AO. THE ASSESSEE SHALL SUBMIT REQUIRED DETAILS AND DOCUMENT S TO ESTABLISH THAT A SUM RS.1,25,21,500/- HAS BEEN MADE FROM DISCLOSED S OURCES. IN CASE, ASSESSEE IS ABLE TO SATISFY THE AO, THEN NO FURTHER ADDITION SHALL BE MADE. HOWEVER, AO SHALL BE FREE TO MAKE ADDITION TO THE E XTENT AS THE ASSESSEE IS NOT ABLE TO SHOW FROM DISCLOSED SOURCES OUT OF TOTA L AMOUNT OF RS.1,25,21,500/-, WHICH IS CLAIMED TO HAVE BEEN SPE NT WAS FROM DISCLOSED SOURCES. THE ASSESSEE SHOULD BE GIVEN ADEQUATE OPP ORTUNITY OF HEARING TO FURNISH REQUISITE DETAILS AND DOCUMENTARY EVIDENCES IN SUPPORT OF ITS CLAIM. THE AO SHALL DECIDE THIS ISSUE AFRESH AFTER CONSIDERING THE MATERIAL AS MAY BE PLACED ON RECORD BY THE ASSESSEE. THIS GR OUND IS ALLOWED FOR STATISTICAL PURPOSES. 16. GROUND 4 IS CONSEQUENTIAL AND DISMISSED. 17. NOW WE SHALL TAKE UP REVENUES APPEAL IN ITA NO.6203/MUM/2012: DURING THE COURSE OF HEARING IT WAS JOINTLY STATED BY BOTH THE PARTIES THAT TAX EFFECT IN THIS APPEAL FIL ED BY THE REVENUE IS LESS THAN RS.10 LAKHS, THEREFORE, THIS APPEAL IS NOT MAI NTAINABLE IN VIEW OF CBDT CIRCULAR NO.21 OF 2015 DATED 10-12-2015. 18. WE HAVE GONE THROUGH THE WORKING SUBMITTED BY THE L D. COUNSEL, SHOWING THAT TAX EFFECT IN THIS APPEAL IS LESS THAN RS.10 LAKHS. THUS, IN VIEW OF THE AFORESAID CIRCULAR OF THE BOARD, THE AP PEAL FILED BY THE REVENUE IS NOT MAINTAINABLE AND THEREFORE DISMISSED AS WITHDRAWN. OUR ORDER SHALL HAVE NO BEARING ON THE MERITS OF THE CA SE. 19. NOW WE SHALL TAKE UP THE APPEAL FILED BY THE ASS ESSEE IN ITA NO.5939/MUM/2012 FOR A.Y.2004-05. 9 EZRA VICTOR 20. GROUNDS 1 & 2 : THESE GROUNDS ARE IDENTICAL TO GROUNDS 1 & 2 OF ASSESSEES APPEAL FOR A.Y. 2003-04. NONE OF THE PA RTIES MADE ANY DISTINCTION BETWEEN FACTS OF A.YS 2003-04 AND 2004- 05. THEREFORE, FOLLOWING OUR ORDER, IT IS HELD THAT THE AO SHOULD ALLOW 50% OF THE EXPENSES IN THE SIMILAR MANNER AS DIRECTED IN AY. 2 003-04. THE AO SHOULD FOLLOW OUR ORDER FOR AY. 2003-04 AND ALLOW RELIEF A CCORDINGLY. THESE GROUNDS ARE ALLOWED PARTLY. 21. GROUND 3: IN THIS REGARD, AS STATED ABOVE ALSO, AN AGGREGATE ADDITION OF RS.1.50 CORE WAS MADE BY THE AO, I.E. R S.50 LAKHS IN AY. 2003- 04 AND BALANCE RS. 1 CRORE IN AY. 2004-05. IN OUR O RDER OF AY 2003-04, WE HAVE SENT THIS ISSUE BACK TO THE FILE OF THE AO WIT H CERTAIN DIRECTIONS. THE AO IS DIRECTED TO FOLLOW THE DIRECTIONS CONTAINED I N OUR ORDER FOR AY. 2003- 04 AND ALLOW RELIEF ACCORDINGLY. THIS GROUND MAY B E TREATED AS ALLOWED, FOR STATISTICAL PURPOSE. 22. GROUND 4 IS CONSEQUENTIAL AND, THEREFORE, DISMISSED . 23. AS A RESULT, APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. 24. NOW WE SHALL TAKE UP APPEAL FILED BY THE REVENU E IN ITA NO.6204/MUM/2012 FOR AY 2004-05, ON THE FOLLOWING GRO UNDS: 1. 'WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN ALLOWING THE DISAL LOWANCE OF THE MAINTENANCE CHARGES OF RS. 5, 95, 000/- BY OBSERVIN G THAT THE ASSESSING OFFICER HAS NOT GIVEN ANY REASONS FOR SUC H DISALLOWANCE WITHOUT APPRECIATING THE FACT THAT THE ASSESSING OFFICER WHILE MAKING THE DISALLOWANCE CLEARLY STATE D THAT THE ASSESSEE DID NOT PRODUCE ANY SUPPORTING EVIDENCE IN RESPECT OF EXPENDITURE DISALLOWED. ' 2. 'WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDIT ION OF RS. 42, 00, 000/- AS UNEXPLAINED CASH CREDIT WHEN THE IDENT ITY, CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTION WHICH ARE 10 EZRA VICTOR BASIC REQUIREMENTS TO ALLOW INTRODUCTION OF CASH IN THE BOOKS OF ACCOUNTS REMAINED UNCOMPLIED WITH. ' 3. 'THE APPELLANT PRAYS THAT THE ORDER OF THE A. O. SHOULD BE RESTORED AND ORDER OF THE CIT(A) SHOULD BE SET ASID E.' 25. GROUND 1: THE REVENUE HAS CHALLENGED THE ACTION OF CIT(A) IN ALLOWING THE DISALLOWANCE OF MAINTENANCE CHARGES OF RS.5,95,000. THE FACTS AND CIRCUMSTANCES FOR MAKING THE DISALLOWANCE ARE IDENTICAL TO AY. 2003-04. THE AO DISALLOWED THE MAINTENANCE CHARGES PAID BY THE ASSESSEE DISREGARDING THE EVIDENCES SUBMITTED BY TH E ASSESSEE MERELY ON THE GROUND THAT BOOKS OF ACCOUNT OF THE ASSESSEE HA VE BEEN REJECTED. LD. CIT(A) CONSIDERED THE EVIDENCES SUBMITTED BY THE AS SESSEE AND ALSO ALL THE FACTS AND CIRCUMSTANCES OF THE CASE AND ALLOWED THE CLAIM OF THE ASSESSEE WITH THE FOLLOWING OBSERVATIONS: 5.3 THE ASSESSING OFFICER'S ORDER, SUBMISSIONS MAD E FOR THE APPELLANT AND MATERIALS ON RECORD HAVE BEEN CONSIDE RED. AS STATED IN THE FOREGOING PARAGRAPHS, THE APPELLANT H AD NOT MAINTAINED BOOKS OF ACCOUNT AND COULD NOT FURNISH S UPPORTING EVIDENCES FOR MOST OF HIS EXPENSES. NO FURTHER DETAILS/EXPLANATIONS/SUPPORTING FOR EXPENSES OTHER THAN GENERAL SUBMISSIONS AS MENTIONED ABOVE AND P&L ACCOUNT (UNA UDITED) WERE FILED EVEN IN APPEAL PROCEEDINGS. THE ASSESSING OFFICER HAS ALLOWED RENT AND LEAVE AN D LICENSE FEE AS PER AGREEMENT. THERE IS THUS NO REASON WHY THE M AINTENANCE CHARGES AGREEMENT ALSO FILED BEFORE THE ASSESSING O FFICER WERE NOT ACCEPTED AND ALLOWED. THE ASSESSING OFFICER HAS NOT GIVEN ANY REASON FOR THE SAME. SINCE THE ASSESSING OFFICE R HAS ALREADY ALLOWED THE LEAVE AND LICENSE FEES, HE IS ALSO DIRE CTED TO ALLOW THE MAINTENANCE CHARGES AS PER AGREEMENT. 26. DURING THE COURSE OF HEARING, THE LD. DR WAS NOT AB LE TO POINT OUT ANYTHING WRONG IN THE FINDINGS OF LD. CIT(A). THE LD. COUNSEL SUBMITTED 11 EZRA VICTOR THAT PROPER EVIDENCES WERE PLACED IN THIS REGARD BE FORE THE LOWER AUTHORITIES AND AFTER TAKING INTO ACCOUNT THE SAME, THE LD. CIT(A) HAS ALLOWED THE RELIEF. 27. WE FIND THAT THE LD. CIT(A) HAS GIVEN THE RELIEF AF TER CONSIDERING THE EVIDENCES BROUGHT BEFORE HIM. NOTHING WRONG COULD BE POINTED OUT BY THE LD. DR IN THIS REGARD AND, THEREFORE, NO INTERF ERENCE IS CALLED FOR IN THE ORDER OF THE LD. CIT(A) ON THIS ISSUE. AS A RESULT , GROUND 1 OF THE REVENUE IS DISMISSED. 28. GROUND 2: IN THIS GROUND, THE REVENUE HAS CHALLENGED THE ACTI ON OF THE LD. CIT(A) IN DELETING THE ADDITION OF RS.42 LA KHS WHICH WAS MADE BY THE AO AS UNEXPLAINED CASH CREDIT. 29. THE BRIEF BACKGROUND OF THE CASE IS THAT THE AO MAD E AGGREGATE ADDITION OF RS.82 LAKHS ON THE GROUND THAT IN THE B ANK ACCOUNT OF THE ASSESSEE VARIOUS ENTRIES REMAINED UNEXPLAINED. DUR ING THE COURSE OF PROCEEDINGS BEFORE LD. CIT(A), THE ASSESSEE FURNISH ED COMPLETE EVIDENCES TO ESTABLISH THE IDENTITY, CREDITWORTHINESS AND GEN UINENESS OF THE AMOUNTS RECEIVED BY THE ASSESSEE WHICH WERE DEPOSIT ED IN THE BANK ACCOUNT. ALL THESE EVIDENCES WERE SENT BY THE LD. CIT(A) TO THE AO FOR EXAMINATION IN THE REMAND PROCEEDINGS AND FOR SENDI NG REMAND REPORT. COPY OF THE REMAND REPORT WAS RECEIVED FROM THE AO IN WHICH THE AO HAD EXAMINED THE COMPLETE EVIDENCES AND IT WAS CONFIRME D BY THE AO IN THE REMAND REPORT THAT AMOUNT OF RS.42 LAKHS WAS GIVEN TO THE ASSESSEE BY MRS. EVA ABOODI, PROPRIETOR OF M/S ALLIANCE PHOTOTY PESETTERS. AFTER CONSIDERING THE REMAND REPORT OF THE AO AS WELL AS THE SUBMISSIONS OF THE ASSESSEE, LD. CIT(A) DELETED THE ADDITION MADE BY T HE AO WITH FOLLOWING OBSERVATIONS: ON MERITS, IN VIEW OF THE EVIDENCE FILED BY THE AP PELLANT, THE IDENTITY OF THE LENDER, THE NARRATION AS PER BALANC E SHEET OF THE LENDER WHO IS ASSESSED TO INCOME TAX, AND THE CERTI FICATE OF THE CHARTERED ACCOUNTANT, THE FACT THAT MONEYS HAVE COM E INTO THE APPELLANT'S BOOKS FROM MLS ALLIANCE PHOTOTYPESETTER S IS CONFIRMED. THE ASSESSING OFFICER'S OBJECTION THAT T HE NAME IS SHOWN AS ZRA ABOODY AND NOT AS EZRA ABOODY APPEARS TO BE A TYPOGRAPHICAL ERROR AND NEEDS TO BE OVERLOOKED. THE BANK 12 EZRA VICTOR ACCOUNT OF ALLIANCE PHOTOTYPESETTERS IS NOT THE ONL Y EVIDENCE WHICH COULD SUPPORT THE TRANSFER OF FUNDS, CORROBOR ATION IS PROVIDED BY THE AUDITOR'S CERTIFICATE AND THE FACT THAT THE SAME IS REFLECTED IN THE BALANCE SHEET OF THE LENDER. THE A DDITION AS REGARDS AMOUNTS RECEIVED FROM SMT. EVA ABOODY OF RS . 42,00,000/- IS ACCORDINGLY DELETED. 30. DURING THE COURSE OF HEARING BEFORE US, THE LD. DR WAS NOT ABLE TO PINT OUT ANYTHING WRONG IN THE FACTUAL FINDINGS REC ORDED BY LD. CIT(A). IT IS NOTED THAT THE AMOUNT RECEIVED BY THE ASSESSEE STAN DS DULY CONFIRMED. THE AMOUNT WAS GIVEN BY ASSESSEES MOTHER FROM HER BANK ACCOUNT, WHO WAS ASSESSED TO INCOME-TAX. IN OUR CONSIDERED OPIN ION, NO INTERFERENCE IS CALLED FOR IN THE ORDER OF LD. CIT(A), AND THEREFOR E, THE SAME IS CONFIRMED. AS A RESULT, GROUND 2 OF THE REVENUES APPEAL IS DI SMISSED. 31. NOW WE SHALL TAKE UP ASSESSEES APPEALS IN ITA NO. 5940/MUM/2012 FOR A.Y. 2005-06; ITA NOS 5941/MUM/201 2 FOR A.Y 2006-07, ITA NO.5942/MUM/2012 FOR A.Y. 2007-08 AND ITA NO.5943/MUM/2012 FOR AY 2008-09. IT IS NOTED THAT GROUNDS RAISED IN THESE APPEALS A RE IDENTICAL. GROUNDS RAISED IN A.Y. 2005-06 ARE REPRODUCED BELOW: THE GROUNDS OF APPEAL RAISED HEREIN ARE ALL WITHOU T PREJUDICE TO ONE ANOTHER: THE LEARNED CIT (APPEALS) WAS NOT JUSTIFIED IN: 1. HOLDING THAT THE REASSESSMENT PROCEEDINGS WERE V ALID AND JUSTIFIED. SHE HAS ERRED IN REJECTING THE SUBMISSIO NS MADE BY THE APPELLANT IN THIS REGARD. 2. CONFIRMING THE REJECTION OF THE BOOKS OF ACCOUNT . THE REASONS GIVEN BY HER IN THIS REGARD ARE UNJUSTIFIED AND UNW ARRANTED. 3. NOT ALLOWING THE ENTIRE EXPENSES CLAIMED BY THE APPELLANT AS A DEDUCTION. SHE HAS ERRED IN ALLOWING ONLY A PART OF THE SAME. 13 EZRA VICTOR 32. IN THESE APPEALS, THE ASSESSEE HAS MAINLY CONTENDED FOR ALLOWING FULL EXPENSES AS WERE CLAIMED BY THE ASSESSEE. IT IS STATED THAT GROUNDS RAISED IN THESE APPEALS ARE IDENTICAL TO GROUNDS 1 & 2 OF ASSESSEES APPEAL FOR A.Y. 2003-04. THUS, THE AO IS DIRECTED TO FOLL OW OUR ORDER FOR A.Y. 2003-04 AND ALLOW 50% OF EXPENSES IN ACCORDANCE WIT H OUR DIRECTIONS AS HAVE BEEN GIVEN IN AY. 2003-04. AS A RESULT, THESE APPEALS ARE PARTLY ALLOWED. 33. IN THE RESULT, REVENUES APPEALS ARE DISMISSED; ASSE SSEES APPEALS ARE PARTLY ALLOWED. ORDER PRONOUNCED IN THE COURT ON THIS _21STH DAY OF DECEMBER, 2016. SD/- SD/- (MAHAVIR SINGH) (ASHWANI TANEJA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DT: 21 ST DECEMBER, 2016 PK/- COPY TO : THE APPELLANT THE RESPONDENT THE CIT(A) THE CIT THE LD. DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE , G-BENCH (TRUE COPY) BY ORDER ASSTT.REGISTRAR, ITAT, MUMBAI BENCHES