ALKESH NARENDRA MEHTA, MUMBAI V. ITO WD 1(1), KALYAN

ITA 7061/MUM/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 4553 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-01-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 08-12-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 20-11-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K DHONDIAL J
• Assessee Lawyers: M DARSHAN GANDHI
• Section: 68

Judgement Text

, - , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC, MUMBAI , ! ' , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, ITA NO.7061/MUM/2014 ASSESSMENT YEAR: 2009-10 SHRI AKILESH NARENDRA MEHTA 403, C-WING, PREM SMURTI, 6 TH ROAD, RAJAWADI, GHATKOPAR, EAST, MUMBAI-400077 / VS. ITO, WARD-1(1), KALYAN / ASSESSEE / REVENUE P.A. NO. AAEPM1012E $ % & / ASSESSEE BY SHRI M. DARSHAN GANDHI $ % & / REVENUE BY SHRI A.K.DHONDIAL JCIT-DR / DATE OF HEARING 07/01/2016 & / DATE OF ORDER: 07/01/2016 & / O R D E R THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER DA TED 19/05/2014 OF THE LD. FIRST APPELLATE AUTHORITY, MU MBAI. THE ONLY GROUND RAISED IN THIS APPEAL PERTAINS TO C ONFIRMING ITA NO.7061/MUM/2014 SHRI ALKESH NARENDRA MEHTA 2 THE ADDITION OF RS.5 LAKH MADE BY THE ASSESSING OFF ICER U/S 68 OF THE INCOME TAX ACT, 1961. 2. DURING HEARING, IT IS NOTED THAT THE APPEAL IS TIME BARRED BY 79 DAYS. THE ASSESSEE EXPLAINED THE REASO NS OF DELAY. THE LD. DR THOUGH CONTENDED THAT THE ASSESSE E HAS TO EXPLAIN THE DELAY OF EACH DAY. NO DOUBT FILING OF A N APPEAL IS A RIGHT GRANTED UNDER THE STATUTE TO THE ASSESSEE A ND IS NOT AN AUTOMATIC PRIVILEGE, THEREFORE, THE ASSESSEE IS EXPECTED TO BE VIGILANT IN ADHERING TO THE MANNER AND MODE IN W HICH THE APPEALS ARE TO BE FILED IN TERMS OF THE RELEVANT PR OVISIONS OF THE ACT. NEVERTHELESS, A LIBERAL APPROACH HAS TO BE ADOPTED BY THE APPELLATE AUTHORITIES, WHERE DELAY HAS OCCURRED FOR BONA FIDE REASONS ON THE PART OF THE ASSESSEE OR THE REV ENUE IN FILING THE APPEALS. IN MATTERS CONCERNING THE FILI NG OF APPEALS, IN EXERCISE OF THE STATUTORY RIGHT, A REFU SAL TO CONDONED THE DELAY CAN RESULT IN A MERITORIOUS MATT ER BEING THROWN OUT AT THE THRESHOLD, WHICH MAY LEAD TO MISC ARRIAGE OF JUSTICE. THE JUDICIARY IS RESPECTED NOT ON ACCOU NT OF ITS POWER TO LEGALIZE IN JUSTICE ON TECHNICAL GROUNDS B UT BECAUSE IT IS CAPABLE OF REMOVING INJUSTICE AND IS EXPECTED TO DO SO. 2.1. THE HONBLE APEX COURT IN A CELEBRATED DECISI ON IN COLLECTOR, LAND ACQUISITION VS MST. KATIJI & ORS. 1 67 ITR 471 OPINED THAT WHEN TECHNICAL CONSIDERATION AND SUBSTA NTIAL JUSTICE ARE PITTED AGAINST EACH OTHER, THE COURTS A RE EXPECTED TO FURTHER THE CAUSE OF SUBSTANTIAL JUSTICE. THIS IS FOR THE REASON THAT AN OPPOSING PARTY, IN A DISPUTE, CANNOT HAVE A ITA NO.7061/MUM/2014 SHRI ALKESH NARENDRA MEHTA 3 VESTED RIGHT IN INJUSTICE BEING DONE BECAUSE OF A N ON- DELIBERATE DELAY. THEREFORE, IT FOLLOWS THAT WHILE CONSIDERING MATTERS RELATING TO THE CONDONATION OF DELAY, JUDIC IOUS AND LIBERAL APPROACH IS TO BE ADOPTED. IF SUFFICIENT C AUSE IS FOUND TO EXIST, WHICH IS BONA-FIDE ONE, AND NOT DUE TO NE GLIGENCE OF THE ASSESSEE, THE DELAY NEEDS TO CONDONED IN SUCH C ASES. THE EXPRESSION SUFFICIENT CAUSE IS ADEQUATELY ELASTIC TO ENABLE THE COURTS TO APPLY LAW IN A MEANINGFUL MANNER, WHI CH SUB- SERVES THE END OF JUSTICE- THAT BEING THE LIFE PURP OSE OF THE EXISTENCE OF THE INSTITUTION OF THE COURTS. WHEN S UBSTANTIAL JUSTICE AND TECHNICAL CONSIDERATION ARE PITTED AGAI NST EACH OTHER, THE CAUSE OF SUBSTANTIAL JUSTICE DESERVES TO BE PREFERRED. THE HONBLE APEX COURT IN VEDABHAI VS SA NTARAM 253 ITR 798 OBSERVED THAT INORDINATE DELAY CALLS OF CAUTIOUS APPROACH. THIS MEANS THAT THERE SHOULD BE NO MALAF IDE OR DILATORY TACTICS. SUFFICIENT CAUSE SHOULD RECEIVE LIBERAL CONSTRUCTION TO ADVANCE SUBSTANTIAL JUSTICE. THE H ONBLE APEX COURT IN 167 ITR 471 OBSERVED AS UNDER:- 3. THE LEGISLATURE HAS CONFERRED THE POWER TO COND ONE DELAY BY ENACTING SECTION 51 OF THE LIMITATION ACT OF 1963 I N ORDER TO ENABLE THE COURTS TO DO SUBSTANTIAL JUSTICE TO PART IES BY DISPOSING OF MATTERS ON DE MERITS. THE EXPRESSION SUFFICIENT CAUSE EMPLOYED BY THE LEGISLATURE IS ADEQUATELY EL ASTIC TO ENABLE THE COURTS TO APPLY THE LAW IN A MEANINGFUL MANNER WHICH SUBSERVES THE ENDS OF JUSTICE THAT BEING THE LIFE-PURPOSE OF THE EXISTENCE OF THE INSTITUTION OF COURTS. IT IS C OMMON KNOWLEDGE THAT THIS COURT HAS BEEN MAKING A JUSTIFI ABLY LIBERAL APPROACH IN MATTERS INSTITUTED IN THIS COURT. BUT T HE MESSAGE ITA NO.7061/MUM/2014 SHRI ALKESH NARENDRA MEHTA 4 DOES NOT APPEAR TO HAVE PERCOLATED DOWN TO ALL THE OTHERS COURTS IN THE HIERARCHY. FURTHERMORE, THE HON'BLE SUPREME COURT IN THE CASE OF VEDABAI ALIA VAIJAYANATABAI BABURAO PATIL VS. SHANT ARAM BABURAO PATIL 253 ITR 798 HELD THAT THE COURT HAS T O EXERCISE THE DISCRETION ON THE FACTS OF EACH CASE KEEPING IN MIND THAT IN CONSTRUING THE EXPRESSION SUFFICIENT CAUSE, TH E PRINCIPLE OF ADVANCING SUBSTANTIAL JUSTICE IS OF PRIME IMPORT ANCE. THE COURT HELD THAT THE EXPRESSION SUFFICIENT CAUSE S HOULD RECEIVE LIBERAL CONSTRUCTION. IN VIEW OF THE FOREGO ING DISCUSSION, THE DELAY IS CONDONED. 2.2. SO FAR AS, SUSTAINING THE ADDITION OF RS.5 LA KH IS CONCERNED, THE LD. COUNSEL FOR THE ASSESSEE EXPLAIN ED THAT THE ASSESSEE PURCHASED ONE RESIDENTIAL HOUSE FOR WHICH LOAN OF RS.32 LAKH WAS OBTAINED FROM SIX PARTIES AND ON SAT ISFACTORILY EXPLANATION BY THE ASSESSEE, THE ADDITION TO THE TU NE OF RS.27 LAKH WAS GRANTED BY THE ASSESSING OFFICER ITSELF AN D THE REMAINING AMOUNT OF RS.5 LAKH WAS GIVEN BY THE IN-L AWS OF THE ASSESSEE (RS.2.5 LAKH EACH BY MOTHER IN-LAW AND FATHER IN-LAW). THE ASSESSEE GAVE THE PAN NUMBER, BANK STA TEMENT OF IN-LAWS AND PAYMENT WAS EXPLAINED TO BE MADE THR OUGH ACCOUNT PAYEE CHEQUE AND FURTHER CONFIRMATION WAS A LSO FILED FROM THEM. IT WAS POINTED OUT THAT THE ENTIRE AMOUN T OF RS.5 LAKH WAS REPAID IN ASSESSMENT YEAR 2011-12 FOR WHIC H MY ATTENTION WAS INVITED TO PAGES 8 AND 9 OF THE PAPER BOOK. ITA NO.7061/MUM/2014 SHRI ALKESH NARENDRA MEHTA 5 RELIANCE WAS PLACED UPON THE DECISION IN THE CASE O F CIT VS VRINDAVAN FARMS PVT. LTD. (ITA NO.71 & 72 OF 2015 O RDER DATED 12/08/2015) FROM HONBLE DELHI HIGH COURT AND CIT VS MARK HOSPITALS PVT. LTD. (2015) 373 ITR 115 (MADRAS ). ON THE OTHER HAND, THE LD. DR, DEFENDED THE CONCLUSION ARRIVED AT IN THE IMPUGNED ORDER BY SUPPORTING THE ADDITION MADE BY THE LD. ASSESSING OFFICER AND SUSTAINED BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS). 2.3. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. UNDER THE FACTS NARRATED HEREINABOVE, THERE IS NO DISPUTE TO THE FA CTS THAT THE AMOUNT OF RS.2.5 LAKH EACH WAS PAID TO THE ASSESSEE (SON-IN- LAW) BY THE IN-LAWS THROUGH ACCOUNT PAYEE CHEQUE AN D THE AMOUNT WAS RETURNED THROUGH CHEQUE IN A.Y. 2011-12 AS IS EVIDENT FROM RECORD. IN SUCH A SITUATION, QUESTION ARISES WHETHER ADDITION WAS RIGHTLY MADE BY THE ASSESSING OFFICER. NO DOUBT, ONUS OF PROVING THE SOURCE SATISFACTORILY , UNDER SECTION 68 OF THE ACT, IS UPON THE ASSESSEE. IN TH E PRESENT APPEAL, THE IDENTITY OF THE IN-LAWS, THEIR CREDITWO RTHINESS, GENUINENESS OF THE TRANSACTION, PAYMENT THROUGH CHE QUE IS NOT IN DISPUTE, THEREFORE, IN MY OPINION, NO ADDITI ON U/S 68 OF THE ACT WAS WARRANTED. IF THE EXPLANATION MADE BY T HE ASSESSEE IS FOUND UNACCEPTABLE BY THE ASSESSING OFF ICER ONUS SHIFTS TO HIM TO PROVE OTHERWISE. THE GENUINENESS O F THE ASSESSEE IS FORTIFIED BY THE FACT THAT THE REMAININ G AMOUNT OF RS.27 LAKH WAS DELETED BY THE LD. ASSESSING OFFICER HIMSELF AS THE ASSESSEE FURNISHED PLAUSIBLE EXPLANATION ALONG WITH ITA NO.7061/MUM/2014 SHRI ALKESH NARENDRA MEHTA 6 NECESSARY EVIDENCE. IN THE PRESENT APPEAL, THE AMO UNT OF RS.2.5 LAKH EACH WAS PAID THROUGH CHEQUE BY THE IN -LAWS TO THE ASSESSEE FOR SPECIFIC PURPOSES OF PURCHASING A RESIDENTIAL HOUSE. IN SUCH A SITUATION, I AM SATISFIED THAT IT IS A FIT CASE, WHERE THE ADDITION HAS TO BE DELETED, MORE SPECIFIC ALLY, WHEN THE ONUS CAST UPON THE ASSESSEE HAS BEEN DISCHARGED , THEREFORE, THE IMPUGNED ADDITION IS DELETED. FINALLY, THE APPEAL OF THE ASSESSEE IS ALLOWED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN T HE PRESENCE OF LD. REPRESENTATIVE FROM BOTH SIDES AT T HE CONCLUSION OF THE HEARING ON 07/01/2016. SD/- (JOGINDER SINGH) ! ' / JUDICIAL MEMBER MUMBAI; DATED : 07/01/2016 F{X~{T? P.S / ! & $ )!*+ ,&+-* / COPY OF THE ORDER FORWARDED TO : 1. '#$%& / THE APPELLANT 2. '(%& / THE RESPONDENT. 3. ) ) * ( '#$ ) / THE CIT, MUMBAI. 4. ) ) * / CIT(A)- , MUMBAI 5. -./ ' , ) '#$ ' 1 , / DR, ITAT, MUMBAI 6. /2 3$ / GUARD FILE. & / BY ORDER, (-# ' //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI