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

ITA 6580/MUM/2016

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 9063 (ITAT-MUMBAI)
• Duration Of Justice: 11 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-10-2017
• 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: Reasonable cause
• Section: 153A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA, A M AND SHRI PAWAN SINGH, JM ./ I.T.A. NO. 6580/MUM/2016 ( / ASSESSMENT YEAR: 2007 - 08 ) MR. BHAVESH P. GANDHI C/O. SKIL HOUSE, 209, BANK STREET CROSS LANE, FORT, MUMBAI - 400 023 / VS. ACIT, CENTRAL CIRCLE 38, NOW DCIT - CC - 6(3), 19 TH FLOOR, AIR INDIA BUILDING, NARIMAN POINT, MUMBAI - 400 021 ./ ./ PAN/GIR NO. AABPG 9515 D ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI S. K. MUTSADDI / RESPONDENT BY : SHRI B. PRUSETH / DATE OF HEARING : 04.10.2017 / DATE OF PRONOUNCEMENT : 11.10. 2017 / O R D E R PER SHAMIM YAHYA , A. M.: T HIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST ORDER OF LEARNED CIT - A DATED 08.07.2016 AND PERTAINS TO ASSESSMENT YEAR 2007 - 08. T HE GROUNDS OF APPEAL READ AS UNDER : 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 RS,4,62,909/ - UNDER THE HEAD INCOME FROM HOUSE PROPERTY IN RESPECT OF THE FLAT AT SAGAR VILLA, WHICH WAS ESTIMATED BY THE AO. THE CIT(A) FURTHER ERRED IN REJEC TING THE APPELLANT'S ARGUMENT THAT SINCE THE PROPERTY WAS CO - OWNED AND THE CO - OWNER HAVING 2 ITA NO. 6580/MUM/2016 (A.Y. 2007 - 08) MR. BHAVESH P. GANDHI VS. ACIT OCCUPIED THE SAME, THE ALV OF THE PROPERTY WAS RS.NIL. WITHOUT PREJUDICE TO THE ABOVE, THE ALV ESTIMATED BY THE AO IN RESPECT OF THE APPELLANT'S SHARE IN SAGAR VILLA 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 ADDITION MADE OF RS.4.62 LAKHS AS STATED IN THE ABOVE GROUND IS BAD IN LAW. 2. THE ASSESSEE HAS ALSO RAISED AN ADDITIONAL GROUND OF APPEAL WHICH READS AS UNDER: 1. ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS.4,62,909/ - IN THE ASSESSMENT U/S. 153A OF THE INCOME TAX ACT, AS NO RELEVANT OR INCRIMINATI NG MATERIAL OR EVIDENCE WAS FOUND OR SEIZED DURING THE COURSE OF THE SEARCH REFLECTING THE INCOME OF RS.4,62,909/ - . 3. FOR ADMISSION OF THIS ADDITIONAL GROUND, THE ASSESSEE HAS MADE FOLLOWING PRAYER : GROUND NOS. 1 & 2 ARE ADDITIONAL LEGAL GROUNDS, WHICH GO TO THE ROOT OF THE APPEAL AND IT IS HUMBLY PRAYED THAT BY FOLLOWING THE DECISIONS IN JUTE CORPORATION OF INDIA V. CIT 187 ITR 688 (SUPREME COURT), AHMEDABAD ELECTRICITY CO. LTD. V. CIT 199 ITR 351 (BOM.) & CIT V. PRITHVI BROKERS & SHAREHOLDERS PVT. LTD. 349 ITR 336 (BOM.), THE SAME BE ADMITTED. 4. A T THE OUTSET IT IS NOTED THAT THERE IS A DELAY OF NINE DAYS IN FILING THE APPEAL. THE REASONABLE CAUSE FOR THE DELAY HAS BEEN ATTRIBUTED TO THE ILLNESS OF THE LD. C OUNSEL. 5 . UPON HEARING BOTH THE C OUNSEL S AND PE R USING THE RECORDS , WE CONDONE THE DELAY. 6 . AT THE OUTSET WE DEAL WITH THE ADDITIONAL GROUND. THIS GROUND IS A LEGAL GROUND AND GOES TO THE ROOT OF THE MATTER . THE CASE LAWS RELIED UPON BY THE LD . C OUNSEL OF THE ASSESSEE FOR ADMISSION OF A DDITIONAL GROUND AND GERMANE . ACCORDINGLY , WE ADMIT THE ADDITION AL GROUND. SINCE THE ADDITIONAL GROUND GOES TO THE ROOT OF THE MATTER, WE DEAL WITH THE SAME AT THE OUTSET. 3 ITA NO. 6580/MUM/2016 (A.Y. 2007 - 08) MR. BHAVESH P. GANDHI VS. ACIT 7 . IN T HE ADDITIONAL GROUND , IT HAS BEEN URGED THAT NO RELEVANT INCRIMINATING MATER IAL OR EVIDENCE WAS FOUND AND SEIZED DURING THE COURSE OF SEARCH REFLECTING THE INCOME OF RS.4, 62 , 909 / - , WHICH HAS BEEN ADDED BY THE ASSESSING OFFICER (A.O.) . HENCE , IT HAS BEEN PLEADED THAT NO SUCH ADDITION IS PERMISSIBLE , S INCE IT IS AN ASSESSMENT U /S. 1 53 A AND ORIGINAL ASSESSMENT IN THIS CASE WAS DULY COMPLETED U /S. 143(3). T HUS IT IS THE A SSESSEE'S PLEA THAT BECAUSE NO INCRIMINATING MATERIAL FOUND DURING SEARCH , THIS ADDITION IS NOT SUSTAINABLE. IN THIS REGARD , THE LD. C OUNSEL OF THE ASSESSEE HAS PLACED RELIANCE UPON SEVERAL CASE LAWS INCLUDING THAT FROM THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. CONTINENTAL WAREHOUSING CORPORATION (NHAVA SHEVA) LTD. [2015] 58 TAXMANN.COM 78 (BOM), ORDER DATED 21.04.2015. 8 . P ER CONTRA, THE LD. DEPARTMENTAL R EPRESENTATIVE (DR) C OULD NOT POINT OUT THAT ANY INCRIMINATING MATERIAL FOR THE ADDITION MADE WAS FOUND DURING SEARCH. 9 . WE FIND THAT HON'BLE BOMBAY HIGH COURT IN THE CASE OF CONTINENTAL WAREHOUSING CORPORATION (NHAVA SHEVA) LTD. (SUPRA) HAS EXPOUNDED T HAT IN CASE OF AN UNABATED ASSESSMENT WHICH HAS BECAME FINAL, NO ADDITION CAN BE MADE WHEN NO INCRIMINATING MATERIAL IS FOUND. THUS , WE FIND WHEN THE ASSESSMENT HAD BEEN DULY COMPLETED U/S. 143(3), ADDITION IN ASSESSMENT U/S. 153A CANNOT BE MADE DEHORS ANY INCRIMINATING MATERIAL FOUND IN S EARCH . IT IS AN ADMITTED POSITION IN THIS CASE THAT NO INCRIMINATING MATERIAL QUA THE ADDITION MADE IN THIS CASE WAS FOUND. HENCE , RESPECTFULLY FOLLOWING THE PRECEDENT AS ABOVE , WE HOLD THAT THE ADDITION IN THIS CASE IS NO T SUSTAINABLE. 10 . SINCE WE HAVE ALREADY ALLOWED THE APPEAL ON THE ADDITION GROUND THAT THE ADDITION IS NOT SUSTAINABLE DEHORS ANY SEIZED MATERIAL, WE ARE NOT ENGAGING INTO THE ADJUDICATION O N THE MERITS OF THE CASE, AS THE SAME IS NOW ONLY OF A CADEMY INT EREST. 4 ITA NO. 6580/MUM/2016 (A.Y. 2007 - 08) MR. BHAVESH P. GANDHI VS. ACIT 1 1 . IN T HE RESULT , THIS APPEAL FILED BY THE ASSESSEE STANDS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 11.10.2017 SD/ - SD/ - ( PAWAN SINGH ) (S HAMIM YAHYA ) / J UDICIAL MEMBER / A CCOUNTANT MEMBER MUMBAI ; DATED : 11.10.2017 . . ./ ROSHANI , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT - CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD F ILE / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI