SUMIT A. BASU, MUMBAI V. ITO-25(2)(3), MUMBAI

ITA 6166/MUM/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 88048 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 4 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-01-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 14-01-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 06-09-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: LOVE KUMAR
• Assessee Lawyers: SUMIT BASU
• Keywords: Condonation of delay

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUM BAI , , BEFORE SHRI JOGINDER SINGH, JM AND SHRI SANJAY ARO RA, AM ./ I.T.A. NO.6166/MUM/2011 ( / ASSESSMENT YEAR: 2008-09) SUMIT A. BASU ROOM NO. 205, DHEERAJ ENCLAVE, W. E. HIGHWAYS, BORIVALI, MUMBAI-400 006 / VS. ITO-25(2)(3), PRATYAKSHAKAR BHAVAN, BANDRA KURLA COMPLEX, BANDRA (E), MUMBAI-400 051 ./! ./PAN/GIR NO. AFBPB 9295 C ( ' /APPELLANT ) : ( #$ ' / RESPONDENT ) ' % & / APPELLANT BY : SHRI SUMIT BASU #$ ' % & / RESPONDENT BY : SHRI LOVE KUMAR ' ()* % +, / DATE OF HEARING : 14.01.2015 DATE OF ORDER : 15.01.2015 - / O R D E R PER SANJAY ARORA, A. M.: THIS IS AN APPEAL BY THE ASSESSEE DIRECTED AGAINST THE ORDER BY THE COMMISSIONER OF INCOME TAX (APPEALS)-35, MUMBAI (CIT(A) FOR SH ORT) DATED 11.07.2011, DISMISSING THE ASSESSEES APPEAL CONTESTING ITS ASSESSMENT U/S .144 OF THE INCOME TAX ACT, 1961 (THE ACT HEREINAFTER) FOR THE ASSESSMENT YEAR (A. Y.) 2008-09 VIDE ORDER DATED 29.12.2010. 2. WE HAVE HEARD THE PARTIES, AND PERUSED THE MATER IAL ON RECORD. WE OBSERVE THAT THE ASSESSMENT IN THE INSTANT CASE STANDS MADE AT AN IN COME OF RS.32.79 LACS, AS AGAINST THE RETURNED INCOME OF RS.6.42 LACS. THE PRINCIPAL ADDI TIONS ARE TOWARD CONTRACT RECEIPTS (RS.17.65 LACS) AND DISALLOWANCE OF PURCHASE/EXPENS ES CHARGED TO THE TRADING ACCOUNT 2 ITA NO. 6166/MUM/2011 (A.Y. 2008-09) SUMIT A. BASU VS. ITO (RS.5.76 LACS). THE CONTRACT RECEIPTS WERE ADDED ON THE BASIS OF THE ANNUAL INFORMATION REPORT (AIR); IT BEING NOT KNOWN WHETHER THE SAME S TOOD INCLUDED BY THE ASSESSEE IN HIS DISCLOSED TURNOVER OF RS.404.53 LACS, I.E., AS A CL EARING AND FORWARDING (C & F) AGENT, OR NOT. THE DISALLOWANCE OF PURCHASE/TRADING EXPENSES IS BY DISTURBING THE ASSESSEES GROSS PROFIT RATE OF 4.57%, ASSESSING IT AT 6%. AS A READ ING OF THE ASSESSMENT ORDER WOULD SHOW, THERE IS NO DEFINITE INFORMATION OR MATERIAL AND, T HUS, BASIS WITH THE REVENUE TO SHOW OR EVEN INDICATE THAT THE ASSESSEE HAD NOT DISCLOSED T HE TURNOVER FINDING MENTION IN THE AIR. RATHER, IN-AS-MUCH AS THE TAX STANDS DEDUCTED AT SO URCE THEREON, AND PRESUMABLY CLAIMED, THE SAME CAN ONLY BE EXPECTED TO BE ACCOUNTED FOR. AGAIN, THE QUESTION WOULD BE, IF THE GROSS RECEIPT, OR ONLY THE GROSS MARGIN THEREON, I. E., ASSUMING IT TO BE UNDISCLOSED, IS LIABLE TO BE BROUGHT TO TAX AS INCOME. SIMILARLY, T HERE IS NO REFERENCE TO THE ASSESSEES GROSS PROFIT RATE FOR THE EARLIER OR SUBSEQUENT YEA RS, OR ANY OTHER COMPARABLE CASE, TO JUSTIFY THE ENHANCED RATE OF 6%. AGAIN, THE ADDITIO N ON ACCOUNT OF UNDISCLOSED TURNOVER, IN-AS-MUCH AS THE ENTIRE RECEIPT STANDS ASSESSED AS INCOME, WOULD ALSO POSITIVELY IMPACT THE GROSS PROFIT RATIO. IN OUR VIEW, THESE FACTS AN D CIRCUMSTANCES ARE REASONS SUFFICIENT AND COMPELLING ENOUGH FOR THE LD. CIT(A) TO HAVE, IN TH E INTEREST OF JUSTICE, CONDONED THE DELAY OF 40 DAYS IN THE FILING OF THE APPEAL BY THE ASSESSEE BEFORE HIM. AS EXPLAINED IN COLLECTOR, LAND ACQUISITION VS. MST. KATIJI AND OTH ERS [1987] 167 ITR 471 (SC), WHEN SUBSTANTIAL JUSTICE AND TECHNICAL CONSIDERATIONS AR E PITTED AGAINST EACH OTHER, THE CAUSE OF SUBSTANTIAL JUSTICE DESERVES TO BE PREFERRED, FOR T HE OTHER SIDE CANNOT CLAIM TO HAVE A VESTED RIGHT IN INJUSTICE BEING DONE BECAUSE OF A N ON-DELIBERATE DELAY. THAT IS, IN THE ABSENCE OF LACHES, WHICH WE DO NOT OBSERVE IN THE I NSTANT CASE, THE CONDONATION OF DELAY SHOULD ALMOST ALWAYS BE GUIDED OR DECIDED ON THE AN VIL OF THE CAUSE OF JUSTICE, WHICH WE OBSERVE AS IMPELLING IN THE INSTANT CASE. THE LD. C IT(A), THEREFORE, IN THE EXERCISE OF HIS JUDICIAL DISCRETION OUGHT TO HAVE IN OUR VIEW CONDO NED THE SAID DELAY. WE, ACCORDINGLY, ALLOWING THE ASSESSEES GROUND # 3 BEFORE US, CHALL ENGING THE SAME, RESTORE THE MATTER BACK TO THE FILE OF THE LD. CIT(A) TO DECIDE THE AS SESSEES APPEAL ON MERITS, I.E., IN ACCORDANCE WITH THE LAW AND AFTER HEARING THE PARTI ES BEFORE HIM. WE DECIDE ACCORDINGLY. 3 ITA NO. 6166/MUM/2011 (A.Y. 2008-09) SUMIT A. BASU VS. ITO 3. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED ON THE AFORE-SAID TERMS. ORDER PRONOUNCED IN THE OPEN COURT ON JANUARY 14, 2 015 SD/- SD/- (JOGINDER SINGH) (SANJAY ARORA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER ' .* MUMBAI; /( DATED : 15.01.2015 ).(. ./ ROSHANI , SR. PS ! ' #$%& ' &$ / COPY OF THE ORDER FORWARDED TO : 1. ' / THE APPELLANT 2. #$ ' / THE RESPONDENT 3. ' 0+ ( ) / THE CIT(A) 4. ' 0+ / CIT - CONCERNED 5. 3)4 #+(5 , , 57 , ' .* / DR, ITAT, MUMBAI 6. 89 :* / GUARD FILE ! ( / BY ORDER, )/(* + (DY./ASSTT. REGISTRAR) , ' .* / ITAT, MUMBAI