RUPALI BHAVESH GANDHI, MUMBAI V. ACIT CEN CIR 38, MUMBAI

ITA 6574/MUM/2016

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 9226 (ITAT-MUMBAI)
• Duration Of Justice: 10 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 31-05-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 09-11-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B PRUSETH
• Assessee Lawyers: S K MUTSADDI
• Keywords: Search and seizure; Rule of consistency; Period of limitation; Condonation of delay
• Section: 143(3); 153A; 14A; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH D,MUM BAI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER AND SHRI PAWAN SINGH, JUDICIAL MEMBER ITA NO.6574 TO 6576/MUM/2016 (ASSESSMENT YEAR- 2007 -08 TO 2009-10) MRS. RUPALI BHAVESH GANDHI C/O SKIL HOUSE, 209, BANK STREET CROSS LANE, FORT, MUMBAI-400023 PAN: AEIPG4028E VS. DCIT-CC-6(3), 19 TH FLOOR, AIR INDIA BUILDING, NARIMAN POINT, MUMBAI-400021. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI S.K. MUTSADDI (AR) REVENUE BY : SHRI B. PRUSETH (DR) DATE OF HEARING : 04.10.2017 DATE OF PRONOUNCEMENT : 04.10.2017 ORDER UNDER SECTION 254(1) OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER : 1. THIS SET OF THREE APPEALS BY ASSESSEE UNDER SECTIO N 253 OF INCOME TAX ACT (THE ACT) ARE DIRECTED AGAINST THE SEPARATE ORDER O F LD. COMMISSIONER OF INCOME-TAX-54, MUMBAI [HEREINAFTER REFERRED AS LD. CIT(A)] DATED 8 TH JULY 2016 FOR ASSESSMENT YEARS (AY) 2007-08, 2008-09 & 2 009-10. THE ASSESSEE HAS RAISED THE IDENTICAL GROUNDS OF APPEAL , FACTS ARE ALSO SIMILAR FOR ALL AYS. THUS, ALL APPEALS WERE HEARD TOGETHER AND ARE DECIDED BY A COMMON ORDER. 2. THE PERUSAL OF RECORD REVEALS THAT ALL THE APPEALS WERE FILED AFTER NINE DAYS OF PRESCRIBED PERIOD OF LIMITATION. THE ASSESSEE HA S FILED A COMBINED 2 ITA NO. 6574 TO 6576/M/2016 - MRS. RUPALI BHAVESH G ANDHI APPLICATION FOR CONDONATION OF DELAY OF 9 DAYS IN A LL APPEALS. IN SUPPORT OF APPLICATION THE AFFIDAVIT OF SHRI MUTSADDI, LD. AU THORIZED REPRESENTATIVE (AR) OF THE ASSESSEE IS FILED. IN THE AFFIDAVIT, TH E DEPONENT HAS STATED THAT HE IS PRACTICING AS CHARTERED ACCOUNTANT (CA) AND P ARTNER OF GPS & ASSOCIATES AND THE DELAY IN FILING THE APPEALS OCC URRED AS HE WAS HOSPITALISED AND OPERATED ON 10.10.2016 FOR BILATER AL INGUNIAL HARNIA AND WAS DISCHARGED ON 12.10.2016. IT WAS ARGUED THAT TH E IMPUGNED ORDER WAS RECEIVED ON 01.09.2016 AND THE ASSESSEE WAS REQUIRE D TO FILE APPEAL ON OR BEFORE BY 31 ST OCTOBER 2016. SINCE, HE WAS NOT ATTENDING THE OFFI CE DUE TO POST OPERATIVE CARE WHICH RESULTED DELAY OF NINE DA YS IN FILING THE APPEALS. THE LD. DR FOR THE REVENUE NOT OBJECTED FOR CONDONI NG THE DELAY. CONSIDERING THE CONTENTS OF APPLICATION AND THE AFF IDAVIT, THE DELAY OF NINE DAYS IN FILING THE APPEAL IS CONDONED. 3. FOR APPRECIATION OF FACT, WE ARE REFERRING THE FACT FOR AY 2007-08. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. ON FACTS & CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT(A) HAS ERRED IN UPHOLDING THE ADDITION MADE BY THE AO OF R S.5,04,987/- IN RESPECT OF UNDER THE HEAD INCOME FROM HOUSE PROPERTY IN RESPEC T OF THE APPELLANT'S SHARE OF 50% IN THE FLAT AT H-3 BREACH CANDY APARTMENTS, WHICH WAS ESTIMATED BY THE AO. THE CIT(A) FURTHER ERRED IN REJECTING THE A PPELLANT'S ARGUMENT THAT SINCE THE PROPERTIES WERE CO-OWNED AND THE CO-OWNER HAVING OCCUPIED THE SAME, THE ALV OF THE PROPERTY WAS RS.NIL. WITHOUT P REJUDICE TO THE ABOVE, THE ALVS ESTIMATED BY THE AO IN RESPECT OF THE APPE LLANT'S SHARE IN THE PROPERTIES IS EXCESSIVE. 2. ON FACTS & CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT(A) HAS ERRED IN REJECTING THE APPELLANT'S PLEA THAT THE AD DITION MADE OF RS.5.04 LAKHS AS STATED IN THE ABOVE GROUND IS BAD IN LAW. 3 ITA NO. 6574 TO 6576/M/2016 - MRS. RUPALI BHAVESH G ANDHI 4. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED RETURN OF INCOME FOR RELEVANT AY ON 02.11.2007 DECLARING TOTAL INCOME OF RS. 2,258/-. THE ASSESSMENT WAS COMPLETED UNDER SECTION 143(3) OF TH E ACT ON 07.12.2009 ASSESSING THE TOTAL INCOME OF RS. 3,563/-. SUBSEQUE NTLY, A SEARCH UNDER SECTION 132 WAS CONDUCTED AT THE PREMISES OF M/S PI PAVAV DEFENCE AND OFFSHORE ENGINEERING CO. LTD. ON 12.10.2011. CONSE QUENT UPON THE SEARCH NOTICE UNDER SECTION 153A DATED 21.08.2012 WAS SERVED UPON THE ASSESSEE. IN RESPONSE TO THE SAID NOTICE, THE ASSES SEE FILED HER RETURN OF INCOME ON 18.10.2012 DECLARING TOTAL INCOME OF RS. 2260/- AS DECLARED ORIGINALLY. THE ASSESSMENT WAS COMPLETED UNDER SECT ION 143(3) R.W.S. 153A ON 26.03.2014. THE ASSESSING OFFICER (AO) WHIL E FRAMING THE ASSESSMENT ORDER BESIDES MAKING THE ADDITION UNDER SECTION 14A OF RS.5413/- MADE AN ADDITION OF RS. 5,04,987/- UNDER THE HEAD INCOME FROM HOUSE PROPERTY. THE AO ESTIMATED THE ANNUAL VALUE OF HOUSE PROPERTY BEING 50% SHARE OF ASSESSEE IN FLAT NO. H-3, BREACH CANDY APARTMENTS. ON APPEAL BEFORE THE LD. CIT(A), THE ACTION OF AO W AS SUSTAINED. THUS, FURTHER AGGRIEVED BY THE ORDER OF LD. CIT(A), THE A SSESSEE HAS FILED THE PRESENT APPEAL BEFORE US. 5. WE HAVE HEARD LD. AR OF THE ASSESSEE AND LEARNED DR FOR THE REVENUE AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE LD. A R OF THE ASSESSEE ARGUED THAT DURING THE SEARCH OPERATION, NO INCRIMINATING MATERIAL QUA THE INCOME 4 ITA NO. 6574 TO 6576/M/2016 - MRS. RUPALI BHAVESH G ANDHI FROM HOUSE PROPERTY FOR THE RELEVANT ASSESSMENT WA S FOUND OR SEIZED. THUS, NO ADDITION CAN BE MADE AGAINST THE ASSESSEE IN RESPECT OF ASSESSMENT WHICH HAS ALREADY BEEN FINALISED. IT WAS ARGUED THAT THE ASSESSMENT UNDER SECTION 143(2) WAS COMPLETED ON 07 .12.2009. IT IS SETTLED LAW THAT NO ADDITION IN THE CONCLUDED ASSESSMENT IN ABSENCE OF INCRIMINATING MATERIAL SEIZED. IN SUPPORT OF HIS SU BMISSION, THE LD. AR OF THE ASSESSEE RELIED UPON THE DECISION OF CIT VS MU RLI AGRO PRODUCTS LTD. [2014] 49 TAXMANN.COM 172 (BOMBAY), CIT VS CONTINE NTAL WHAREHOUSING CORPORATION NAVA SHEVA LTD. 374 ITR 64 5 (BOMBAY HC), CIT VS KABUL CHAWLA (61 TAXMAN.COM 412 (DELHI HC), PARAG M. SANGHVI VS ACIT (63 TAXMAN.COM 118 (MUMBAI ITAT), RAWAL DA S JASWANI VS ACIT (61 TAXMAN.COM 343 (RAIPUR ITAT), ACIT VS JAY ENDRA P. JHAVERI (46 TAXMAN.COM 457 (MUMBAI ITAT) AND BERMACO ENERGY SYSTEMS LTD. VS DCIT (ITA NO. 2198/2199 & 2022/MUM/2013). ON TH E OTHER HAND, THE LD. DR FOR THE REVENUE SUPPORTED THE ORDER OF A UTHORITIES BELOW. IT WAS ARGUED THAT INCRIMINATING MATERIAL WAS SEIZED DURIN G THE SEARCH ACTION ON 12.10.2011. ON SPECIFIC QUERY FROM LD. DR FOR THE R EVENUE THAT IF ANY INCRIMINATING MATERIAL RELATED TO INCOME FROM HOUSE PROPERTY FOR RELEVANT ASSESSMENT YEAR, FOUND OR SEIZED IN SAID SEARCH AC TION. THE LD. DR FOR THE REVENUE FAIRLY CONCEDED THAT NO INCRIMINATING MATER IAL RELATED TO INCOME FROM HOUSE PROPERTY FOR THE YEAR UNDER CONSIDERATI ON WAS SEIZED. 5 ITA NO. 6574 TO 6576/M/2016 - MRS. RUPALI BHAVESH G ANDHI 6. WE HAVE CONSIDERED THE RIVAL SUBMISSION OF THE PART IES AND HAVE GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. IT IS AN A DMITTED FACT THAT ASSESSMENT FOR RELEVANT AY WAS COMPLETED UNDER SECT ION 143(3) ON 07.12.2009. A SEARCH AND SEIZURE ACTION WAS CONDUCT ED ON 12.10.2011. ADMITTEDLY, THERE IS NOTHING ON RECORD WHICH MAY SU GGEST THAT ANY INCRIMINATING MATERIAL WAS UNEARTHED FOR THE ASSESS MENT YEAR UNDER CONSIDERATION DURING THE SAID SEARCH RELATED WITH I NCOME FROM HOUSE PROPERTY. THE HONBLE JURISDICTIONAL HIGH COURT IN CASE OF CIT VS. CONTINENTAL WHAREHOUSING CORPORATION NAVA SHEVA LTD . (SUPRA) HELD THAT NO ADDITION CAN BE MADE IN RESPECT OF ASSESSMENT WH ICH HAS BECOME FINAL, IF NOT INCRIMINATING MATERIAL IS FOUND DURING THE S EARCH. SIMILARLY, THE HONBLE DELHI HIGH COURT IN CIT VS. KABUL CHAWLA (S UPRA) HELD THAT COMPLETED ASSESSMENT CAN BE INTERFERED BY AO WHILE PASSING THE ASSESSMENT ORDER UNDER SECTION 153A ONLY ON THE BAS IS OF INCRIMINATING MATERIAL UNEARTHED DURING THE COURSE OF SEARCH WHIC H WAS NOT PRODUCED OR NOT ALREADY DISCLOSED DURING THE ORIGINAL ASSESSMEN T. THUS, CONSIDERING THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT AND H ONBLE DELHI HIGH COURT, NO ADDITION ON ACCOUNT OF INCOME FROM HOUSE PROPERTY COULD BE MADE IN THE ASSESSMENT ORDER COMPLETED UNDER SECTIO N 143(3) WAY BACK ON 107.12.2009. HENCE, THE GROUNDS OF APPEAL RAISED BY ASSESSEE ARE ALLOWED. ITA NO. 6575/MUM/2016 AY-2008-09 6 ITA NO. 6574 TO 6576/M/2016 - MRS. RUPALI BHAVESH G ANDHI 7. THE ASSESSEE HAS RAISED THE IDENTICAL GROUNDS OF AP PEAL AS RAISED IN APPEAL FOR AY 2007-08. THE ASSESSMENT FOR THE YEAR UNDER C ONSIDERATION WAS COMPLETED UNDER SECTION 143(3) OF THE ACT ON 27.10. 2010. FURTHER, NO INCRIMINATING MATERIAL WAS FOUND IN THE SEARCH COND UCTED ON 12.10.2011. CONSIDERING THE PRINCIPLE OF CONSISTENCY THE GROUN D OF APPEAL RAISED BY ASSESSEE IS ALLOWED. ITA NO. 6576/MUM/2016 AY-2009-10 8. THE ASSESSEE HAS RAISED THE IDENTICAL GROUNDS OF AP PEAL AS RAISED IN APPEAL FOR AY 2007-08 & 2008-09. THE ASSESSMENT FOR THE YE AR UNDER CONSIDERATION WAS COMPLETED UNDER SECTION 143(3) OF THE ACT ON 30.08.2010 ACCEPTING THE TOTAL INCOME OF RS. 6,35,2 50/-. A SEARCH AND SEIZURE ACTION WAS CONDUCTED ON 12.10.2011 UNDER SE CTION 132 OF THE ACT. NO INCRIMINATING MATERIAL RELATED WITH INCOME FROM HOUSE PROPERTY WAS FOUND OR SEIZED. CONSIDERING THE FACT THAT WE HAVE ALREADY ALLOWED THE APPEAL FOR AY 2007-08 & 2008-09. THUS, FOLLOWING TH E PRINCIPLE OF CONSISTENCY WHEN THE ASSESSEE HAS RAISED IDENTICAL GROUND. THUS, THIS GROUND OF APPEAL RAISED BY ASSESSEE IS ALSO ALLOWED . 9. IN THE RESULT, APPEALS FILED BY ASSESSEE FOR ALL AY S ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 4 TH OCTOBER, 2017. SD/-/ - SD/- (SHAMIM YAHYA) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI; DATED 04/10/2017 7 ITA NO. 6574 TO 6576/M/2016 - MRS. RUPALI BHAVESH G ANDHI S.K.PS COPY OF THE ORDER FORWARDED TO : BY ORDER, (ASSTT.REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY/