MUDASSIR RASHID AHMED BAKHLA, MUMBAI V. ITO 17(2)(3), MUMBAI

ITA 7420/MUM/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 7643 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2013-2014
• Appeal Filed On: 26-12-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JYOTILAKSHMI NAYAK
• Keywords: Unexplained investment
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D, BENCH MUM BAI BEFORE SHRI SAKTIJIT DEY, JUDICIAL MEMB ER & SHRI G. MANJUNATHA, ACCOUNTANT MEMB ER ITA NO.7420/MUM/2018 ( ASSESSMENT YEAR :2013-14 ) MUDASSIR RASHID AHMED BAKHLA MAKKER & CO. SHOP NO.7/B, SHAMJI MORARJI BUILDING CHAMPSI BHIMJI ROAD MAZGAON MUMBAI-400 010 VS. ITO-17(2)(4) AAYKAR BHAWAN MUMBAI-400 020 PAN/GIR NO.AELPB9504K APPELLANT ) .. RESPONDENT ) REVENUE BY SMT. JYOTILAKSHMI NAYAK, DR ASSESSEE BY MS. NEHA PARANJPE, AR DATE OF HEARING 21 /01/2020 DATE OF PRONOUNCEME NT 29 /01/2020 / O R D E R PER G.MANJUNATHA (A.M) : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGA INST ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS)58, MU MBAI, DATED 16/10/2018 AND IT PERTAINS TO ASSESSMENT YEAR 2013- 14. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL. 1. THE ORDER OF THE ASSESSING AUTHORITY PASSED ON 2 2/02/2016 AND ON DATED 03/03/2016, THE APPEAL BEFORE THE CIT(A) WAS FILED. THE SAID APPEAL WAS FILED IN PROPER TIME I.E ON 03/03/2016. 2. DURING THE COURSE OF HEARING THE CIT(APPEAL) RAI SED THE ISSUE THAT THE APPEAL WAS NOT E-FILED ON TIME AS PER CBDT GUIDELIN ES WHICH IS IN CORRECT. IT HAS REQUESTED THAT SAME SHOULD BE ACCEPTED AS THE M ANURE LINE THE APPEAL IS IN IN PROPER TIME BUT THE CIT(APPEAL) REJECT THE SAME ON TECHNICAL GROUND ITA NO.7420/MUM/2018 MUDASSIR RASHID AHMED BAKHLA 2 AND NO MERIT WAS DISCUSSED. THE ORDER FOR REJECTION WAS FILED AS INADMISSIBLE ON THE GROUND THAT SAME IS NOT E-FILED. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E HAS FILED HIS RETURN OF INCOME FOR AY 2013-14 ON 05/01/2014, DECL ARING TOTAL INCOME AT RS. 9,44,630/-. THE CASE WAS SELECTED FOR SCRUTINY AND THE ASSESSMENT HAS BEEN COMPLETED U/S 143(3) OF THE I.T .ACT, 1961, ON 22/02/2016, DETERMINING THE TOTAL INCOME AT RS. 13, 08,590/- BY MAKING ADDITIONS TOWARDS ADHOC DISALLOWANCES OF 10% BUSINESS PROMOTION EXPENSES AND TRAVELLING EXPENSES OF RS. 6 3,960/- AND ADDITIONS OF RS. 3 LACS TOWARDS INVESTMENT IN LAND AT KARJAT, AS UNEXPLAINED INVESTMENTS. THE ASSESSEE CARRIED THE M ATTER IN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY. THE LD.CIT(A) FOR THE REASONS RECORDED IN HIS APPELLATE ORDER, DISMISSED APPEAL FILED BY THE ASSESEE FOR NON FILING APPEAL IN ELECTRONIC FORM, A S REQUIRED UNDER RULES 45 & 46 OF I.T.RULES, 1962. AGGRIEVED BY THE LD.CIT(A) ORDER, THE ASSESEE IS IN APPEAL BEFORE US. 4. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATE RIAL AVAILABLE ON RECORD AND GONE THROUGH ORDERS OF THE AUTHORITIE S BELOW. WE FIND THAT AN IDENTICAL ISSUE HAS BEEN CONSIDERED BY US I N ITA NO. 6781/MUM2018, IN THE CASE OF DEEPAK RAHEJA, WHERE U NDER IDENTICAL SET OF FACTS, THE ISSUE HAS BEEN SET ASID E TO THE FILE OF THE LD.CIT(A) AND DIRECT HIM TO ADMIT APPEAL FILED BY T HE ASSESEE AND TO DECIDE THE ISSUES INVOLVED IN APPEAL ON MERITS IN A CCORDANCE WITH LAW. THE RELEVANT FINDINGS OF THE TRIBUNAL ARE AS U NDER;- 5. NONE APPEARED FOR THE ASSESSEE. WE HAVE HEARD T HE LD. DR AND PERUSED THE MATERIALS AVAILABLE ON RECORD ALONG WIT H ORDERS OF THE LD.CIT(A). WE FIND THAT THE LD.CIT(A) HAS DISMISSED APPEAL FILED BY THE ASSESSEE IN-LUMINE ON TECHNICAL GROUND FOR NOT FIL ING APPEAL IN ELECTRONIC ITA NO.7420/MUM/2018 MUDASSIR RASHID AHMED BAKHLA 3 FORM AS PER AMENDED RULE 45 OF THE I.T.RULES,1962, AS WELL AS CBDT CIRCULAR NO. 11/2016, DATED 01/03/2016 AND 20/2016 DATED 26/05/2016, ALTHOUGH, THE ASSESSEE HAS FILED APPEAL WITHIN THE PRESCRIBED TIME ALLOWED UNDER THE ACT IN MANUAL FORM. THE ASSESSEE HAS EXPLAINED THE REASONS FOR NOT FILING APPEAL IN ELECTRONIC FORM BE FORE THE LD.CIT(A), AS PER WHICH THE ASSESSEE WAS NOT AWARE OF THE AMENDED RULE 45 OF THE I.T.RULES, 1962, WHICH MANDATES FILING OF APPEALS I N ELECTRONIC FORM. FURTHER, WHEN THE SAID LAPSES HAS BEEN BROUGHT TO T HE NOTICE OF THE ASSESSEE, IT HAS FILED APPEAL IN ELECTRONIC FORM ON 29/08/2018. BUT THE LD.CIT(A) HAS DISMISSED APPEAL FILED BY THE ASSESS EE, ON THE GROUND THAT SAID APPEAL IS NOT MAINTAINABLE, AS PER THE PR OVISION OF SECTION 249(1) OF THE ACT. NO DOUBT, THE LAW HAS BEEN AMEND ED, SO AS TO FILE APPEAL IN ELECTRONIC FORM AFTER CERTAIN DATES AND A S PER WHICH, ALL APPEALS ARE REQUIRED TO BE FILED IN ELECTRONIC FORM ONLY. B UT, WHEN THE ASSESSEE HAS EXPLAINED THE REASONS FOR NOT FILING APPEAL IN ELECTRONIC FORM AND SAID REASONS ARE BONAFIDE, THEN THE LD.CIT(A) OUGHT TO H AVE CONSIDERED THE EXPLANATION OF THE ASSESSEE, CONDONE THE DELAY IN FILING OF APPEAL AND DISPOSE-OFF THE APPEAL ON MERITS IN ACCORDANCE WITH LAW, BECAUSE, THE ASSESSEE HAS FILED APPEAL IN MANUAL FORM WITHIN THE DUE DATE PRESCRIBED UNDER THE ACT. THEREFORE, WE ARE OF THE CONSIDERED VIEW THAT WHEN, THE ASSESSEE HAS FILED AN APPEAL IN MANUAL FORM WITHIN THE PRESCRIBED TIME ALLOWED UNDER THE ACT AND ALSO, RECTIFIED THE LAPSE S, AS AND WHEN SAID LAPSES HAS BEEN BROUGHT TO HIS NOTICE, THE APPEAL O F THE ASSESSEE CANNOT BE DISMISSED ON TECHNICAL GROUNDS THAT TOO DURING TRANSITION PERIOD. 6. WE FURTHER NOTICED THAT THE CO-ORDINATE BENCH OF ITAT, MUMBAI G BENCH, IN THE CASE OF M/S. ASTERIX REINFORCED LTD., VS ITO IN ITA NO. 426/MUM/2018 HAD CONSIDERED AN IDENTICAL ISSUE AND AFTER CONSIDERING RELEVANT FACTS HAS RESTORED THE APPEAL TO THE FILE OF THE LD. CIT(A) AND DIRECT HIM TO CONDONED DELAY IN FILING APPEAL IN EL ECTRONIC FORM AND TO DECIDE THE ISSUE ON MERITS IN ACCORDANCE WITH LAW. THE RELEVANT FINDINGS OF THE TRIBUNAL ARE AS UNDER:- 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IT IS AN UNDISPUTED FACT THAT THE CBDT HAS MANDATED FILING OF APPEAL IN ELECTRONIC FORM AFTER A CERTAIN DATE BY ISSUING NOTIFICATION VIDE NOTIFICATION NO.SO 637(E) [NO.11/2016 (F. NO.149/150/2015-TPL)] DATED 01.03.16 AS PER WHICH T HE ASSESSEE IS REQUIRED TO FILE FORM NO.35 ELECTRONICALLY. IT I S ALSO AN ADMITTED FACT THAT THE CBDT HAS EXTENDED SUCH DUE DATE OF FI LING OF APPEAL IN ELECTRONIC MODE UP TO 15.06.16 CONSIDERING THE HARDSHIPS/TECHNICAL GLITCHES IN FILING THE APPEAL E LECTRONICALLY. ADMITTEDLY, THE ASSESSEE HAS FILED ITS APPEAL IN PA PER FORM ON 29.04.16. THE ASSESSEE CLAIMS THAT IT IS UNAWARE OF THE NOTIFICATION ISSUED BY THE CBDT FOR FILING APPEALS IN ELECTRONIC FORMAT, THEREFORE, IT HAS FILED ITS APPEAL IN MANUAL FORM O N 29.04.16. THE ASSESSEE FURTHER CLAIMS THAT DURING TRANSITION PERI OD THE PROVISIONS OF NOTIFICATION SHOULD NOT BE APPLIED STRICTLY. ITA NO.7420/MUM/2018 MUDASSIR RASHID AHMED BAKHLA 4 7. HAVING HEARD BOTH THE SIDES, WE FIND MERITS IN T HE ARGUMENTS OF THE ASSESSEE FOR THE REASON THAT DURING TRANSITION PERIOD THE PROVISIONS OF ANY NOTIFICATION OR CIRCULARS MANDATI NG THE ASSESSEES TO FOLLOW CERTAIN INSTRUCTIONS SHOULD NOT BE STRICT LY APPLIED. WE FURTHER NOTICED THAT THE ASSESSEE HAS FILED ITS APP EAL IN MANUAL FORM AND SUCH APPEAL HAS BEEN FILED WITHIN THE PRES CRIBED TIME UNDER THE ACT. THEREFORE, WE ARE OF THE CONSIDERED VIEW THAT MERELY BECAUSE THE ASSESSEE HAS NOT FILED THE APPEA L IN ELECTRONIC FORM, THE ASSESSEE'S APPEAL CANNOT BE DISMISSED ON TECHNICAL GROUNDS THAT TOO DURING TRANSITION PERIOD. WE, FURT HER, NOTICED THAT THE HON'BLE SUPREME COURT AND VARIOUS HIGH COURTS H AVE ALREADY CATEGORICALLY STATED THAT WHEN TECHNICALITIES AND S UBSTANTIAL JUSTICE IS PITTED AGAINST EACH OTHER, THE SUBSTANTIAL JUSTI CE DESERVES TO BE PREVAILED OVER TECHNICALITIES. THEREFORE, WE ARE OF THE CONSIDERED VIEW THAT THE LD. CIT(A) WAS ERRED IN DISMISSING TH E APPEAL FILED BY THE ASSESSEE AS NOT MAINTAINABLE, HENCE, WE SET ASI DE THE ISSUE TO THE FILE OF THE LD. CIT(A) AND DIRECT HIM TO ADM IT THE APPEAL FILED BY THE ASSESSEE BY DIRECTING THE ASSESSEE TO FILE I TS APPEAL IN ELECTRONIC FORMAT AND ALSO TO CONDONE DELAY IN FILI NG SUCH APPEAL IN ELECTRONIC FORMAT. WE ALSO DIRECT THE LD. CIT(A) TO DECIDE THE ISSUES ON MERITS. 7. IN THIS VIEW OF THE MATTER AND RESPECTFULLY FOLL OWING THE DECISION OF CO-ORDINATE BENCH OF MUMBAI IN THE CASE OF M/S. AST ERIX REINFORCED LTD.,VS ITO IN ITA NO. 426/MUM/2018, WE RESTORED TH E ISSUE BACK TO THE FILE OF THE LD.CIT(A) AND DIRECT HIM TO ADMIT THE A PPEAL FILED BY THE ASSESEE AND DECIDE THE ISSUE ON MERITS IN ACCORDANC E WITH LAW. 5. IN THIS VIEW OF THE MATTER AND RESPECTFULLY F OLLOWING THE DECISION OF CO-ORDINATE BENCH OF ITAT, IN THE CASE OF DEEPAK RAHEJA IN ITA NO. 6781/MUM/2018, WE RESTORED THE ISSUE TO THE FIL E OF THE LD.CIT(A) AND DIRECT THE LD.CIT(A) TO DECIDE THE IS SUES ON MERITS IN ACCORDANCE WITH LAW. THE ASSESSEE SHALL FILE, THE A PPEAL IN ELECTRONIC FORM WITHIN 10 DAYS FROM THE DATE OF RECEIPT OF THIS ORDER, IF APPEAL IS NOT FILED IN ELECTRONIC FORM. 6. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSE. ITA NO.7420/MUM/2018 MUDASSIR RASHID AHMED BAKHLA 5 ORDER PRONOUNCED IN THE OPEN COURT ON THIS 29 /01/ 2020 SD/- (SAKTIJIT DEY) SD/- (G. MANJUNATHA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED : 29/01/2020 THIRUMALESH SR.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//