MOTILAL PNACHALAL GALA, MUMBAI V. ITO 22(1)(3), MUMBAI

ITA 6550/MUM/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 1384 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-04-2017
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 29-10-2014
• Court: TRIBUNAL
• Department Lawyers: JOTILAKSHMI NAYAK
• Assessee Lawyers: RAHUL K HAKANI; NEELAM C JADHAV
• Keywords: Opportunity of being heard; Principle of natural justice; Additional evidence
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER AND SHRI RAVISH SOOD, JUDICIAL MEMBER ITA NO.6550/M/2014 (2009 - 2010) MOTILAL PNACHALAL GALA, M/S. PANCHALAL BHIMJI RATNACHANDRAJI JAIN BLDG, SHOP NO.9, CAMA LANE, GHATKOPAR (W), MUMBAI - 400086. / VS. ITO - 22(1)(3), MUMBAI. ./ PAN : AAKPG1384R ( / APPELLANT) .. ( / RESPONDENT ) / APPELLANT BY : SHRI RAHUL K HAKANI & MS. NEELAM C JADHAV / RESPONDENT BY : MS. JOTILAKSHMI NAYAK, DR / DATE OF HEARING : 15.03.2017 / DATE OF PRONOUNCEMENT : 07 .04.2017 / O R D E R PER D. KARUNAKARA RAO, AM: THIS APPEAL FILED BY THE ASSESSEE ON 29.10.2014 IS AGAINST THE ORDER OF THE CIT (A) - 33, MUMBAI DATED 14.8.2014 FOR THE ASSESSMENT YEAR 2009 - 2010. 2. BEFORE US, LD COUNSEL FOR THE ASSESSEE BROUGHT OUR ATTENTION TO THE GROUNDS OF APPEAL AND THE FACTS OF TH E CASE AND SUBMITTED THAT THE ASSESSEE IS A TRADER IN COTTON FABRIC AND MANUFACTURER OF SCHOOL BAGS. ASSESSEE MAINTAINS A BANK ACCOUNT IN ICICI BANK. DURING THE ASSESSMENT PROCEEDINGS, AO NOTED THE CASH DEPOSITS IN THE SAID BANK ACCOUNT AND THEY TOTALLED TO RS. 35,18,669/ - . IN THE ASSESSMENT, AO MADE ADDITION U/S 68 OF THE ACT. FURTHER, AO ALSO ADDED ANOTHER SUM OF RS. 2 LAKHS OF LOAN CREDITS FROM BHAVANA J SHAH AND SUMATILALA H MODI (HUF) U/S 68 OF THE ACT. MATTER TRAVELLED TO THE FIRST APPELLATE AUTH ORITY. 3. DURING THE PROCEEDINGS BEFORE THE FIRST APPELLATE AUTHORITY, AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, CIT (A) CONFIRMED THE ADDITIONS MADE BY THE AO. AGGRIEVED, ASSESSEE IS IN FURTHER APPEAL BEFORE THE TRIBUNAL. 2 4. ON THE FIRST ADDITION OF RS. 35,18,669/ - , DEVIATING FROM THE GROUND NO.1, LD AR SUBMITTED THAT AO MAY RESIST THIS ADDITION AND ALLOW THE BENEFIT OF TELE SCOPY AND MADE ADDITION, IF ANY. LD AR HIGHLIGHTED THAT THE TELESCOPY IS NOT A LION TO THE INCOME TAX PROCEEDINGS. AFTER HEARING BOTH THE PARTIES ON THIS ISSUE, WE APPROVE THE ARGUMENTS OF THE LD AR. ACCORDINGLY WE ORDER. IN THE SET ASIDE PROCEEDINGS, AO IS DIRECTED TO EXAMINE THE CASH WITHDRAWAL AND DEPOSIT POSITION FROM ALL THE BANK ACCOUNTS OF THE ASSESSEE WITH IC ICI AND OTHER BANKS, IF ANY, AND REWORK AT THE ADDITION. ASSESSEE IS ALSO DIRECTED TO EXPLAIN THE ABOVE AND FILE RELEVANT DETAILS / STATEMENT. AO IS FURTHER DIRECTED TO UNDERTAKE COMPREHENSIVE STUDY INTO THE WITHDRAWALS AND DEPOSITS IN CASH. ACCORDINGLY , ALL ADDITIONAL EVIDENCES ARE ADMITTED AND THE MATTER IS REMANDED TO THE FILE OF THE AO WITH ABOVE DIRECTIONS. ASSESSEE SHALL BE GRANTED A REASONABLE OPPORTUNITY OF BEING HEARD AS PER THE SET PRINCIPLES OF NATURAL JUSTICE. THUS, THE RELEVANT GROUND IS AL LOWED FOR STATISTICAL PURPOSES. 5. REGARDING THE ADDITION OF RS. 2 LAKHS, WE ARE OF THE VIEW THAT BOTH THE LOAN CREDITORS ARE TAX PAYERS AND FILED THEIR RETURN OF INCOME TO THE IT DEPARTMENT. ON THIS ISSUE, IT IS THE PRAYER OF THE LD AR THAT THIS ISSUE SH OULD ALSO BE REMANDED TO THE FILE OF THE AO FOR FRESH ADJUDICATION AND DECISION. ACCORDINGLY WE ORDER AND THE MATTER IS REMANDED TO THE AOS FILE WITH IDENTICAL DIRECTIONS. THUS, RELEVANT GROUND RAISED BY THE ASSESSEE IS ALLOWED. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRO NOUNCED IN THE OPEN COURT ON 0 7 T H APRIL, 2017. S D / - S D / - ( RAVISH SOOD) (D. KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; 07.04.2017 . . ./ OKK , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 3 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI