Shri Anuradha Ajay Deshmukh, Baroda V. The Income tax Officer,Ward-1(2), Baroda

ITA 685/AHD/2011

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 9717 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 10 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 08-12-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 03-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K
• Keywords: Unexplained investment; Salary income; Opportunity of being heard; Bonafide belief; Additional evidence
• Section: 143(3)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ./ ITA NO. 685/AHD/2011 & 971/AHD/2014 / ASSESSMENT YEAR: 2006-07 ANURADHA AJAY DESHMUKH, 62, VRAJ SHANTI, VISHWAS COLONY, ALKAPURI, BARODA .. APPELLANT PAN : AIGPD 3372 C VS INCOME TAX OFFICER, WARD-1(2) BARODA .. RESPONDENT ASSESSEE(S) BY : SHRI TUS HAR P. HEMANI , AR REVENUE BY : SHRI A.K. PANDAY, SR - DR / DATE OF HEARING 08/12/2015 /DATE OF PRONOUNCEMENT 01/02/2016 / O R D E R PER SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER: THE APPEAL IN ITA NO. 685/AHD/2011 FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE CIT(A )-I, BARODA DATED 29.12.2010 FOR ASSESSMENT YEAR 2006-07 AND T HE APPEAL IN ITA NO. 971/AHD/2014 FILED BY THE ASSESSE E IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF I NCOME-TAX (APPEALS)-I, BARODA DATED 27.02.2014 CONFIRMING THE PENALTY U/S 271(1)(C) LEVIED BY THE ASSESSING OFFICER FOR A SSESSMENT YEAR 2006-07. ITA NO. 685/AHD/2011 & 971/AHD/2014 ASSESSEE- ANURADHA AJAY DESHMUKH AY 2006-07 - 2 - 2. AT THE TIME OF HEARING, IT WAS ADMITTED BY BOTH THE PARTIES THAT THE ISSUES RAISED IN THESE APPEALS ARE SIMILAR TO THE ISSUES RAISED IN APPEALS ITA NOS. 686/AHD/2011 & 1117/AHD/ 2013 IN THE CASE OF CHETNA AMIT DESHMUKH VS. ITO FOR ASS ESSMENT YEAR 2006-07. 3. WE HAVE ALREADY CONSIDERED THE ARGUMENTS OF BOTH THE SIDES WHILE DECIDING THE APPEALS IN THE CASE OF CH ETNA AMIT DESHMUKH FOR ASSESSMENT YEAR 2006-07 VIDE ITA NOS.686/AHD/2011 AND 1117/AHD/2013, WHEREIN THE ISS UE WAS SET ASIDE TO THE FILE OF THE ASSESSING OFFICER WITH THE FOLLOWING FINDINGS:- ITA NO. 686/AHD/2011 : AY 2006-07 2. IN THIS APPEAL, THE ASSESSEE HAS RAISED FOLLOWIN G GROUNDS:- 1. THE ORDER PASSED U/S 143(3) R.W.S 144 OF THE ACT IS BAD IN LAW. 1.1 ON THE FACTS AND CIRCUMSTANCES OF YOUR APPELLANTS CASE AS WELL AS IN LAW, THE LD. CIT(A) HAS ERRED IN NOT ADJUDICATING GROUND NO.1 AS PRAYED IN GROUNDS OF APPEAL THAT THE ORDER PASSED U/S 143(3) R.W.S. 144 OF THE ACT IS BAD IN LAW. 1.2 YOUR APPELLANT PRAYS YOUR HONOUR TO HOLD SO NOW AND TREAT THE PROCEEDINGS AS BAD IN LAW. 2. CONFIRMATION OF ADDITION TO THE TUNE OF RS.35,00,000/- AS UNEXPLAINED INVESTMENT. 2.1 ON THE FACTS AND CIRCUMSTANCES OF YOUR APPELLANTS CASE AS WELL AS IN LAW, THE LD. CIT(A) HAS ERRED IN CONFIRMING ADDITION TO THE TUNE OF RS.35,00,000/- AS UNEXPLAINED INVESTMENT ITA NO. 685/AHD/2011 & 971/AHD/2014 ASSESSEE- ANURADHA AJAY DESHMUKH AY 2006-07 - 3 - ALTHOUGH NECESSARY DETAILS THEREOF WERE FURNISHED. 2.2 THE LD. CIT(A) HAS ERRED IN NOT TAKING INTO CONSIDERATION FACT THAT THE INVESTMENT TO THE TUNE OF RS.5,00,000/- IN HDFC MUTUAL FUND, OUT OF TOTAL INVESTMENT TO THE TUNE OF RS.35,00,000/- IS OWNED BY AMIT DESHMUKSH (FAMILY MEMBER) AND YOUR APPELLANT IS ONLY SECOND HOLDER FOR SUCH INVESTMENT. 2.3 YOUR APPELLANT THEREFORE PRAYS YOUR HONOUR TO HOLD SO NOW AND DIRECT THE LD. AO TO DELETE THE ADDITION TO THE TUNE OF RS.35,00,000/- ON ACCOUNT OF UNEXPLAINED INVESTMENT. 3. YOUR APPELLANT CRAVES LEAVE TO ADD, ALTER AND / OR AMEND THE GROUNDS HEREIN ABOVE RAISED. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E HAS FURNISHED RETURN OF INCOME ON 03.07.2006 DECLARING TOTAL INCOME OF RS.96,000/-. THE ASSESSING OFFICER FRAME D ASSESSMENT U/S 143(3) OF THE INCOME-TAX ACT ON 28.11.2008, DETERMINING TOTAL INCOME OF THE ASSESSE E AT RS.35,96,000/-, WHICH INCLUDED THE UNEXPLAINED INVESTMENT IN MUTUAL FUND, AMOUNTING TO RS.35,00,00 0/-, IN THE FOLLOWING INVESTMENTS. NAME OF FUND AMOUNT DATE OF INVESTMENT HDFC MUTUAL FUND RS.5,00 ,000 06.02.2006 FRANKLIN TEMPLETON MUTUAL FUND RS.5,00,000 06.02.2006 P RUDENTIAL ICICI MUTUAL FUND RS.5,00,000 13.02.2006 HDFC MUTUAL FUND RS.5,00,000 06.02.2006 PRUDENTIAL ICICI MUTUAL FUND RS.5,00,000 06.02.2006 FRANKLIN TEMPLETON MUTUAL FUND RS.10 ,00,000 06.02.2006 RS.35,00,000 2.1 THE ASSESSING OFFICER ASKED THE ASSESSEE TO FUR NISH THE COPY OF BANK STATEMENTS AND THE SOURCES OF INVESTMENTS BY A NOTICE DATED 23.10.2008 BUT THE ITA NO. 685/AHD/2011 & 971/AHD/2014 ASSESSEE- ANURADHA AJAY DESHMUKH AY 2006-07 - 4 - ASSESSEE COULD NOT FURNISH ANY DETAILS. SINCE THE ASSESSEE WAS HAVING SALARY INCOME OF RS.96,000/-, T HE ASSESSING OFFICER WAS OF THE VIEW THAT THE SOURCE O F INVESTMENTS WAS NOT EXPLAINED AND HE ACCORDINGLY AD DED RS.35,00,000/- TO THE TOTAL INCOME OF THE ASSESSEE. 4. MATTER WAS CARRIED BEFORE THE FIRST APPELLATE AUTHORITY, WHO AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, CONFIRMED THE ADDITION IN QUESTION ON THE GROUND THAT THE SOURCE OF THE SAID AMOUNT WAS NOT EXPLAINED. BEFORE US, THE AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE FILED AN APPLICATION FOR ADDITIONAL EV IDENCE, INTER ALIA , SUBMITTING THAT THE ASSESSEE IS PLACING 34 PAGES OF DOCUMENTS AS ADDITIONAL EVIDENCES ON RECOR D BEFORE THE ITAT. HE FURTHER CONTENDED THAT AT THE ASSESSMENT STAGE, THE MATTER WAS HANDLED BY SHRI NI TIN C. PARMAR, INCOME TAX PRACTITIONER, ON BEHALF OF AS SESSEE AND THE ASSESSEE WAS UNDER A BONAFIDE BELIEF THAT T HE DETAILS AS REQUIRED FROM TIME TO TIME WERE SUBMITTE D BY HIM. HOWEVER, SUCH DETAILS WERE NOT FILED BY SHRI PARMAR BEFORE THE ASSESSING OFFICER AND THE ASSESSMENT CAM E TO BE FRAMED U/S 143(3) R.W.S. 144 OF THE ACT. HE ALS O SUBMITTED THAT AT THE APPELLANT STAGE, THE ASSESSEE MADE STRENUOUS EFFORTS TO COLLECT THESE EVIDENCES FROM S HRI PARMAR, BUT COULD NOT BE ABLE TO COLLECT THE SAME F ROM HIM; HENCE THESE ADDITIONAL EVIDENCES COULD NOT BE PLACED EVEN BEFORE THE CIT(A). WE FIND FORCE IN THE SUBMI SSIONS OF THE ASSESSEE THAT THE ADDITIONAL EVIDENCES SUBMI TTED BY THE ASSESSEE ARE FOUND TO BE IMPORTANT AND DECISIVE PIECE OF EVIDENCE IN DETERMINING THE CONTROVERSY IN JUST AND EQUITABLE MANNER. IN VIEW OF THE ABOVE AND IN THE INTEREST OF JUSTICE, WE ADMIT THE APPLICATION FOR A DDITIONAL EVIDENCES FILED BY THE ASSESSEE. ACCORDINGLY, WE SE T ASIDE THE ORDER OF THE ASSESSING OFFICER WITH THE DIRECTI ON TO DECIDE THE ISSUE AFRESH, AFTER CONSIDERING THE ADDI TIONAL EVIDENCES SUBMITTED BY HIM, AS PER FACTS AND LAW. WE ALSO DIRECT THE ASSESSEE TO FURNISH NECESSARY EXPLA NATION / EVIDENCES AS DISCUSSED ABOVE BEFORE THE ASSESSING OFFICER. NEEDLESS TO MENTION THAT THE ASSESSING OF FICER WILL ALLOW ADEQUATE OPPORTUNITY OF BEING HEARD TO T HE ASSESSEE WHILE RE-ADJUDICATING THIS MATTER. SINCE W E ARE RESTORING THE MATTER TO THE FILE OF ASSESSING OFFIC ER ON PRELIMINARY ISSUE AS DISCUSSED ABOVE, WE ARE REFRAI NING TO COMMENT ON MERIT OF ISSUE AT HAND. ITA NO. 685/AHD/2011 & 971/AHD/2014 ASSESSEE- ANURADHA AJAY DESHMUKH AY 2006-07 - 5 - 5. IN THE RESULT, THIS APPEAL OF THE ASSESSEE IS A LLOWED FOR STATISTICAL PURPOSES. ITA NO. 1117/AHD/2013 : AY 2006-07 6. IN THIS APPEAL, THE ASSESSEE HAS TAKEN FOLLOWING GROUNDS OF APPEAL:- 1. ON THE FACTS AND CIRCUMSTANCES OF YOUR APPELLANT'S CASE AND IN LAW, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-I, BARODA (LD. CIT(A) IN SHORT) HAS ERRED IN NOT APPRECIATI NG THAT THE PENALTY ORDER WAS PASSED WITHOUT PROVIDING PROPER OPPORTUNITY OF BEING HEARD AND HENCE TO BE TREATED US BAD IN LAW. 2.ON THE FACTS AND IN THE CIRCUMSTANCES OF YOUR APPELLANT'S CASE AND IN LAW, THE LD. CIT(A) HAS ERR ED IN APPRECIATING NECESSARY DOCUMENTARY EVIDENCES FURNISHED JUSTIFYING SOURCE OR INVESTMENT TO THE TU NE OF RS.35,00,000/- AND HENCE, NO PENALTY SHOULD BE IMPOSED. 3. THE LD, CIT(A) HAS FURTHER ERRED IN NOT CONSIDER ING DECISIONS RELIED UPON BY YOUR APPELLANT. 4. YOUR APPELLANT CRAVES LEAVE TO ADD, ALTER AND/OR AMEND THE GROUNDS HEREIN ABOVE RAISED. 7. THIS APPEAL HAS BEEN PREFERRED BY THE ASSESSE E, CHALLENGING THE ORDER OF THE CIT(A) IN CONFIRMING T HE PENALTY OF RS.11,51,000/-, WHICH WAS IMPOSED BY THE ASSESSING OFFICER U/S. 271(1)(C) OF THE ACT. THE IS SUE IN THIS APPEAL IS PENALTY, WHICH IS CONSEQUENTIAL DEPE NDING UPON THE OUTCOME OF THE MAIN ISSUE AS REFERRED HEREINABOVE IN QUANTUM APPEAL, I.E., ITA NO.686/AHD/2011. 8. SINCE WE HAVE RESTORED THE MAIN ISSUE BACK TO TH E FILE OF ASSESSING OFFICER IN THE QUANTUM APPEAL, TH E ISSUE OF PENALTY IS ALSO RESTORED BACK TO THE FILE OF ASS ESSING OFFICER WITH THE DIRECTION TO DECIDE THE SAME AS PE R FINAL OUTCOME IN THE QUANTUM PROCEEDINGS AS WELL AS FACTS AND LAW, AFTER PROVIDING DUE OPPORTUNITY OF HEARING TO THE ASSESSEE. 4. SINCE THE FACTS OF THE CASE UNDER APPEALS BEFORE US AND THE FACTS BEFORE THE ITAT, A BENCH, AHMEDABAD IN THE CASE OF ITA NO. 685/AHD/2011 & 971/AHD/2014 ASSESSEE- ANURADHA AJAY DESHMUKH AY 2006-07 - 6 - CHETNA AMIT DESHMUKH (SUPRA) FOR ASSESSMENT YEAR 20 06-07 ARE IDENTICAL, THE ABOVE DECISION WOULD BE SQUARELY APPLICABLE TO THE CASE OF THE ASSESSEE. THEREFORE, IN VIEW OF TOTALITY OF ABOVE FACTS AND THE DECISION OF THE TRIBUNAL (SUPRA ), WE SET ASIDE THE ORDER OF THE ASSESSING OFFICER WITH THE D IRECTION TO DECIDE THE ISSUE AFRESH, AFTER CONSIDERING THE ADDI TIONAL EVIDENCES SUBMITTED BY ASSESSEE, AS PER FACTS AND L AW, AFTER PROVIDING DUE OPPORTUNITY OF HEARING TO THE ASSESSE E. SINCE WE HAVE RESTORED THE MAIN ISSUE BACK TO THE FILE OF AS SESSING OFFICER IN THE QUANTUM APPEAL, THE ISSUE OF PENALTY IS ALSO RESTORED BACK TO THE FILE OF ASSESSING OFFICER WITH THE DIRECTION TO DECIDE THE SAME AS PER FINAL OUTCOME IN THE QUAN TUM PROCEEDINGS AS WELL AS FACTS AND LAW, AFTER PROVIDI NG DUE OPPORTUNITY OF HEARING TO THE ASSESSEE. 5. IN THE RESULT, BOTH THE APPEALS FILED BY THE ASS ESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 1 ST OF FEBRUARY, 2016 AT AHMEDABAD. SD/- SD/- ( RAJESH KUMAR ) ACCOUNTANT MEMBER ( SHAILENDRA KUMAR YADAV ) JUDICIAL MEMBER AHMEDABAD; DATED 01/02/2016 *BT ITA NO. 685/AHD/2011 & 971/AHD/2014 ASSESSEE- ANURADHA AJAY DESHMUKH AY 2006-07 - 7 - !'# $#! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A), 5. !'# $$ , , / DR, ITAT, AHMEDABAD 6. #() / GUARD FILE. / BY ORDER, //TRUE COPY// / (DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD