SUKHRAM R. KANOJIA, MUMBAI V. ITO 24(20(2), MUMBAI

ITA 6271/MUM/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 1411 (ITAT-MUMBAI)
• Duration Of Justice: 7 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-07-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 05-07-2010
• Assessment Year: 2005-2006
• Appeal Filed On: 04-12-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K SINGH
• Keywords: Unexplained cash credit; Income from undisclosed sources
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL 'SMC' BENCH, MUMBAI BEFORE SHRI A.L. GEHLOT, ACCOUNTANT MEMBER ITA NO. 6271/MUM/2009 (ASSESSMENT YEAR: 2005-06) SHRI SUKHRAM R. KANOJIA INCOME TAX OFFICER - 24(2) (2) 409-410, ABUWALA HOUSE C-10, PRATYAKSHA KAR BHAVAN GUNDECHA INDL. ESTATE VS. BANDRA-KURLA COMPLEX KANDIVALI (E). MUMBAI 400101 BANDRA (E), MUMBAI 40 0097 PAN - AQAPK 4738 M APPELLANT RESPONDENT APPELLANT BY: NONE RESPONDENT BY: SHRI S.K. SINGH O R D E R PER A.L. GEHLOT, A.M. THIS APPEAL BY THE ASSESSEE IS AGAINST THE ORDER OF THE CIT(A)- XXIV, MUMBAI DATED 26.06.2008. 2. THE ASSESSEE RAISED THE FOLLOWING GROUNDS: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LEARNED INCOME TAX OFFICER HAS ERRED IN STATING THA T THE ASSESSEE WAS ENGAGED IN RETAIL TRADE OF MEDICINES DURING THE YEAR. THE FACT IS THAT THE ASSESSEE WAS ENGAGED IN THE BUSINESS OF LAUNDRY AND DRY CLEANING. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED INCOME TAX OFFICER HAS ERRED IN MAKING ADDI TION OF RS.2,00,000/- AS UNEXPLAINED CASH CREDIT IN THE BOO KS OF ASSESSEE AND ACCORDINGLY TREAT IT AS INCOME FROM UNDISCLOSED SOURCES OF THE APPELLANT U/S 68 OF THE I.T. ACT, 1961. 3. THE ASSESSEE HAS BEEN VESTED WITH THE RESPONSIBI LITY OF SAFEKEEPING A SUM OF RS.2,00,000 (RECEIVED IN BREAK UPS OF RS.50,000) BY HIS BROTHERS, FOR THEY DO NOT POSSESS A BANK ACCOUNT. THE AMOUNT REMAINED DEPOSITED IN THE BANK UNTIL 23. 01.2007, WHEN THE BROTHERS IS UNISON PURCHASED A SHOP WITH T HE AMOUNT. THE APPELLANT PRAYS THAT UNWARRANTED ADDITION OF RS .2,00,000/- ON ACCOUNT OF THE ABOVE STATED REASON, SHOULD BE DELET ED. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED INCOME TAX OFFICER MADE AD-HOC DISALLOWANCE S OF RS.10,000 ON THE GROUNDS THAT THERE IS ABSENCE OF B ILLS/VOUCHERS AS ITA NO. 6271/MUM/2009 SHRI SUKHRAM R. KANOJIA 2 WELL AS PERSONAL ELEMENT OF THESE EXPENSES, WITHOUT CONSIDERING THE FACT THAT DURING THE ASSESSMENT PROCEEDINGS NO SUCH TYPE OF DETAILS WERE ASKED. THE APPELLANT SUBMITS THAT THE ADDITION BE DELETED. 3. NONE APPEARED ON BEHALF OF THE ASSESSEE. CONSIDERIN G THE FACTS OF THE CASE I PROCEED TO DECIDE THE APPEAL ON MERITS. 4. THE ASSESSEE HAS FILED RETURN OF INCOME DECLARING T OTAL INCOME OF RS.82,260/-. THE CASE WAS SELECTED FOR SCRUTINY. TH E ASSESSEE DID NOT APPEAR BEFORE THE A.O. IN SPITE OF VARIOUS NOTICES. THE A.O. MADE AN ADDITION OF RS.2,00,000/- UNDER SECTION 68 AND RS.10,000/- D ISALLOWANCE OUT OF VARIOUS EXPENSES. THE ASSESSEE FILED APPEAL BEFORE THE CIT(A). THE CIT(A) NOTED THAT THE APPEAL SHOULD HAVE BEEN FILED WITHIN 30 DAYS, I.E. BY 17 TH JANUARY 2008 BUT THE ASSESSEE HAS FILED THE APPEAL ON 25 TH JANUARY 2008. THERE IS 9 DAYS DELAY IN FILING THE APPEAL BEFORE T HE CIT(A). THE ASSESSEE FILED A CONDONATION PETITION WHEREIN IT WAS STATED THAT H E IS UNEDUCATED AND HIS EX-REPRESENTATIVE DID NOT GUIDE HIM PROPERLY, WHICH CAUSED THE DELAY IN FILING THE APPEAL. THE CIT(A) DID NOT ACCEPT THIS C ONDONATION PETITION AND THE SAME WAS REJECTED. THE ASSESSEE FILED APPEAL BEFORE THE ITAT, WHICH IS ALSO LATE BY 86 DAYS. IN THE CONDONATION PETITION THE AS SESSEE SUBMITTED THAT HE IS ENGAGED IN THE BUSINESS OF LAUNDRY AND DRY CLEAN ING AND HE SUFFERED A SERIOUS INJURY TO HIS HANDS. THEREFORE, THE APPEAL WAS NOT FILED IN TIME. HENCE, AFTER CONSIDERING THE FACTS OF THE CASE, IN THE INTEREST OF JUSTICE, I CONDONE THE DELAY IN FILING THE APPEAL. SIMILARLY T HE CIT(A) IS ALSO DIRECTED TO CONDONE THE DELAY ON ACCOUNT OF SUBSISTENCE OF JUST ICE AND DECIDE THE ISSUE ON MERITS IN ACCORDANCE WITH LAW AFTER PROVIDING OP PORTUNITY OF HEARING TO BOTH THE SIDES. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FO R STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 5 TH JULY 2010. SD/- (A.L. GEHLOT) ACCOUNTANT MEMBER MUMBAI, DATED: 5 TH JULY 2010 ITA NO. 6271/MUM/2009 SHRI SUKHRAM R. KANOJIA 3 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) XXIV, MUMBAI 4. THE CIT XXIV, MUMBAI CITY 5. THE DR, SMC BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.