I T O WD - 3(1), DHULE, Dhule V. SHRI GOPAL BHABANLAL AGARWAL, Dhule

ITA 620/PUN/2009

• Counselvise Citation: 62024514 RSA 2009
• Duration Of Justice: 2 year(s) 5 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 13-10-2011
• Assessment Year: 2001-2002
• Appeal Filed On: 21-05-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Reopening of assessment; Unexplained cash credit; Unexplained investment; Difference of opinion; Change of opinion
• Section: 143(3); 147; 68; 69; 148; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE SHRI I.C. SUDHIR, JUDICIAL MEMBER AND SHRI G.S. PANNU, ACCOUNTANT MEMBER SL. NO ITA NO. ASSTT. YEAR APPELLANT RESPONDENT 1. 620/PN/09 2001- 02 INCOME-TAX OFFICER, WD.3(1) DHULE SHRI GOPAL BABANLAL AGRAWAL, J.B. ROAD, DHULE 2. 621/PN/09 2001- 02 INCOME-TAX OFFICER, WD. 3(1) DHULE SHRI SURESH HIRALAL AGRAWAL, SHIRPUR, DHULE 3. 622/PN/09 2001- 02 INCOME-TAX OFFICER, WD. 3(1) DHULE -DO- APPELLANT AT S. NO. 1 BY : SHRI SUNIL GANO O APPELLANTS AT S.NO. 2 & 3 BY: SHRI M R BHAGWAT RESPONDENT BY : SHRI S K AMBASTHA DATE OF HEARING : 13.10.2011 DATE OF PRONOUNCEMENT : 21.10.2011 ORDER PER G. S. PANNU, A.M : THE CAPTIONED PROCEEDINGS RELATE TO TWO ASSESSEES BELONGI NG TO ONE FAMILY AND THE ISSUE INVOLVED IS COMMON. THEREFORE, THE Y WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY A CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE AND BREVITY. 2 2. THE FIRST COMMON ISSUE IN THE REVENUES APPEALS, VID E ITA NO 620 & 622/PN/09 IS THAT THE COMMISSIONER OF INCOME-TAX (APPEA LS) ERRED IN TREATING THE REOPENING OF THE ASSESSMENT AS BAD IN LAW. AS THE FACTS A RE COMMON IN BOTH THE APPEALS, WE SHALL TAKE ITA NO 620/PN/09 IN THE CASE OF SHRI GOPAL BABANLAL AGRAWAL AS A LEAD CASE. THE RELEVANT FACTS, IN BRIEF, A RE THAT IN THIS CASE THE ASSESSEE FILED A RETURN OF INCOME ON 3.10.2001 DECLARING TOTAL INCOME AT RS 84,328/- FOR THE ASSESSMENT YEAR 2001-02. THE SAID RET URN WAS PROCESSED UNDER SECTION 143(1) OF THE INCOME-TAX ACT, 1961 (IN SHORT TH E ACT). IT APPEARS THAT DURING THE COURSE OF ASSESSMENT OF M/S AGRASEN NAGARI SAHAK ARI PATSANSTHA, DHULE FOR THE ASSESSMENT YEARS 1999-2000 AND 2001-02, I T WAS NOTICED BY THE ASSESSING OFFICER THAT THERE WERE CERTAIN BANAMI DEPOSITS I N THE SAID PATSANSTHA IN THE NAMES OF VARIOUS FICTITIOUS PERSONS. THE SAID DEPO SITS WERE RECORDED IN TWO SEPARATE REGISTERS R1 AND R2, WHICH WERE IMPOUNDED BY THE DEPARTMENT. THE SAID PATSANSTHA VIDE ITS LETTER DATED 15.3.2004 IN FORMED THE DY. COMMISSIONER OF INCOME-TAX CIR. 3(1), DHULE, THAT SHRI GOPAL B AGRAWAL, HAD DEPOSITED AN AMOUNT OF RS 20 LAKHS IN THE NAMES OF FICT ITIOUS PERSONS AND WAS PAID RS 20,63,876/- ON 24.7.2000. ON THE BASIS OF THI S INFORMATION, THE ASSESSING OFFICER ISSUED NOTICE UNDER SECTION 148 TO THE ASSESSEE ON 10.3.2006. THE ASSESSEE SUBMITTED THAT THE RETURN OF INCOME FILED BY HI M ON 3.10.2001 DECLARING TOTAL INCOME OF RS 84,328/- MAY BE TREATED AS FILED IN RESPONSE TO THE NOTICE UNDER SECTION 148 OF THE ACT. THE ASSESSMENT WAS FINALIZED ON 29.12.2006 ON TOTAL INCOME OF RS 21,84,204/- MAKING ADDITION OF RS 2 0,63,876/- ON ACCOUNT OF UNDISCLOSED FDS AND INTEREST THEREON. 3. IN APPEAL, THE COMMISSIONER OF INCOME-TAX (APPEALS) DELETED THE WHOLE ADDITION. THE COMMISSIONER OF INCOME-TAX (APPEALS) TR EATED THE REOPENING OF ASSESSMENT BY THE ASSESSING OFFICER AS BAD IN LAW. ACCORDING T O THE COMMISSIONER OF INCOME-TAX (APPEALS), THE ENTIRE FACTS W ERE AVAILABLE WITH THE ASSESSING OFFICER AND IT WAS A MERE CHANGE OF OPINION ON SA ME FACTS TO REOPEN 3 THE ASSESSMENT UNDER SECTION 148 OF THE ACT.. AGAINST THIS FINDING OF THE COMMISSIONER OF INCOME-TAX (APPEALS), REVENUE IS IN APPE AL BEFORE US. 4. THE NEXT ISSUE RELATES TO THE DELETION OF THE ADDIT ION OF RS 20,63,876/- MADE BY THE COMMISSIONER OF INCOME-TAX (APPEALS). THE ASSESSING OFFICER TAXED THE DEPOSITS IN THE HANDS OF THE ASSESSEE AS UNEXPLA INED INVESTMENT UNDER SECTION 69 OF THE ACT. IN APPEAL, THE COMMISSIONER OF INCOME-TAX (APPEALS) DELETED THE SAID ADDITION HOLDING THAT THE ASSESSING OFFICER HAS NOT BEEN ABLE TO ESTABLISH THAT THE ACTUAL INVESTMENT IN F IXED DEPOSITS WAS MADE BY THE ASSESSEE. ACCORDINGLY, HE DELETED THE ADDITION OF R S 20,63,576/- AGAINST WHICH THE REVENUE IS IN APPEAL BEFORE US. 5. IN THIS BACKGROUND, WE HAVE CONSIDERED THE RIVAL STAND S. THE LEARNED COUNSEL FOR THE RESPONDENT-ASSESSEE REFERRED TO THE ASSESSM ENT ORDER DATED 31.3.2004 IN THE CASE OF SHREE AGRASEN SAHAKARI PATSANSTH A MARYADIT, DHULE , PERTAINING TO THE ASSESSMENT YEAR 2001-02 WHEREIN THE CORRESPONDING FDRS HAS BEEN ASSESSED AS UNEXPLAINED CASH CREDITS. IT WAS, THEREFORE , CONTENDED THAT ONCE SAME AMOUNT HAS BEEN ASSESSED IN THE HANDS OF THE PA TSANSTHA, THE SAME WOULD NOT SUFFER ADDITION IN THE HANDS OF THE ASSESSEE IN DIVIDUALS. IN THIS REGARD, REFERENCE WAS ALSO MADE TO THE DECISION OF THE TRIBUNAL IN THE CASE OF SHRI AGRASEN SAHAKARI PATSANSTHA MARYADIT, DHULE, VIDE ITA NOS 1459 & 1460/PN/05 DATED 30.6.2011, WHEREIN THE ADDITION MADE IN THE H ANDS OF THE PATSANSTHA UNDER SECTION 68 OF THE ACT WAS UPHELD AND, THE SAME WAS HELD ENTITLED FOR DEDUCTION UNDER SECTION 80P OF THE ACT. IN SUM AND SUBSTA NCE, THE PLEA SET-UP IS THAT INCOME CORRESPONDING TO THE IMPUGNED AMOUNTS HAS AL READY SUFFERED TAXATION AND THE SAME WOULD NOT BE LIABLE TO BE ASSESSE D IN THE HANDS OF THE ASSESSEE. THE AFORESAID FACTUAL MATRIX BROUGHT OUT BY TH E RESPONDENT-ASSESSEE HAS NOT BEEN CONTROVERTED BY THE LEARNED DEPARTMENTAL REPRESENTATIVE; SO, HOWEVER, IT IS SOUGHT TO JUSTIFY THE ADDITION MADE BY THE ASSESSING OFFICER IN THE IMPUGNED ORDER. 4 6. IN VIEW OF THE AFORESAID FACTUAL MATRIX, WHICH IS U NCONTROVERTED, WE THEREFORE FIND NO JUSTIFICATION TO DIFFER WITH THE UL TIMATE CONCLUSION DRAWN BY THE COMMISSIONER OF INCOME-TAX (APPEALS) TO THE EFFECT THA T THE ADDITION OF RS 20,63,576/- MADE BY THE ASSESSING OFFICER AS UNEXPLAINED INVESTMENT UNDER SECTION 69 IS UNTENABLE, ALBEIT ON A DIFFERENT GROUND INASMUCH AS THE SAME HAS BEEN ASSESSED IN THE HANDS OF THE PATSANSTHA. IN THIS VIE W OF THE MATTER, WE, THEREFORE, DISMISS THE APPEAL FILED BY THE REVENUE AS THE ADDITION IN QUESTION IS HELD TO BE UNSUSTAINABLE. IN DOING SO, THE OTHER ISSUES R AISED IN THE APPEAL OF THE REVENUE ARE RENDERED ACADEMIC, SINCE THE APPEAL OF THE REVENUE HAS BEEN DISMISSED IN THE AFORESAID MANNER. RESULTANTLY, THE APPE AL OF THE REVENUE IS DISMISSED. 7. THE FACTS AND CIRCUMSTANCES IN THE CASE OF SHRI SURESH H AGRAWAL, VIDE ITA NO 622/PN/09 BEING IDENTICAL, THE AFORESAID DECISI ON WOULD MUTATIS MUTANDIS APPLY TO THIS CASE ALSO. ON THE PARITY OF REASONING, TH EREFORE, THE APPEAL OF THE REVENUE IS DISMISSED. 8. THE FACTS RELATING TO THE ISSUE RAISED BY THE REVENU E IN ITA NO 621/PN/09 IN THE CASE OF SHRI SURESH H AGRAWAL ARE THE ASSESSING O FFICER NOTICED THAT INTEREST RECEIVED ON FDS ON 12.2.2001 REMAINED TO BE A DDED TO THE TOTAL INCOME OF THE ASSESSEE WHILE FINALIZING THE ORDER UNDER SECTION 143(3) READ WITH SECTION 147 ON 29.12.2006. THE ASSESSING OFFICER ACCORDINGLY PASSED AN ORDER UNDER SECTION 154 AND TAXED THE INTEREST INCOME OF RS 16,86,8 84/- UNDER SECTION 69 OF THE ACT. IN APPEAL, THE COMMISSIONER OF INCOME-TAX (APP EALS) DELETED THE ADDITION MADE BY THE ASSESSING OFFICER IN VIEW OF HIS FIN DING IN THE ORIGINAL APPELLATE PROCEEDINGS AGAINST THE ORDER UNDER SECTION 14 3(3) READ WITH SECTION 147 THAT THE REOPENING WAS BAD IN LAW AND CONSEQUENTLY , ASSESSEE HAS NOT MADE ANY UNEXPLAINED INVESTMENT IN FDRS WITH SHRI AG RASEN NAGARI SAHAKARI PATSANSTHA. BEING AGGRIEVED, REVENUE IS IN APPEAL BEFO RE US. 5 9. CONSEQUENT TO OUR DECISION IN ITA NO 620/PN/09 AND 622/PN/09, THE IMPUGNED ADDITION IS ALSO HELD UNSUSTAINABLE. RESULTANT LY, THIS APPEAL OF THE REVENUE IS DISMISSED. 10. IN THE RESULT, ALL THE CAPTIONED APPEALS OF THE R EVENUE ARE DISMISSED. PRONOUNCED IN THE OPEN COURT ON THIS 21 ST DAY OF OCTOBER, 2011. SD/- SD/- (I.C. SUDHIR) (G.S. PAN NU) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE, DATED: 21 ST OCTOBER, 2011 B COPY TO:- 1) THE ASSESSEES 2) ITO, WD 3(1) DHULE 3) THE CIT-(A)-I, NASHIK 4) THE CIT-I, NASHIK 5) THE D R, A BENCH, ITAT, PUNE 6) GUARD FILE BY ORDER TRUE COPY ASST. REGISTRAR, I.T.A.T., PUNE