ALKESH S. PAREKH, MUMBAI V. ITO WD 13(3)(3), MUMBAI

ITA 7432/MUM/2016

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 9952 (ITAT-MUMBAI)
• Duration Of Justice: 8 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-09-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2006-2007
• Appeal Filed On: 19-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V JANARDHANAN
• Assessee Lawyers: RUSHABH SHAH
• Keywords: Unexplained investment; Opportunity of being heard; Source of fund; Additional evidence; Reassessment proceedings
• Section: 69; 2

Judgement Text

, SMC , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC, MUMBAI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER ITA NO.7432/MUM/2016 : ASST.YEAR 2006-2007 SHRI ALKESH S. PAREKH 1, GANESH CHHAYA, R.B.MEHTA MARG GHATKOPAR (EAST) MUMBAI 400 077. PAN : AADPP3668E. / VS. THE INCOME TAX OFFICER WARD 13(3)(3) MUMBAI. ( / APPELLANT) ( / RESPONDENT) /APPELLANT BY : SHRI RUSHABH SHAH /RESPONDENT BY : SHRI V.JANARDHANAN / DATE OF HEARING : 06.07.2017 / DATE OF PRONOUNCEMENT : 01.09.2017 / O R D E R THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LEARNED CIT(A) DATED 05.10.2016 AND PERTAINS TO ASSESSMENT YEAR 2006-2007. 2. THE GROUNDS OF APPEAL READ AS UNDER:- 1) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS IN LAW, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ACTION OF LEARNED ASSESSING OFFICER IN REOPENING THE CASE, WITHOUT CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE. 2) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS IN LAW, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ACTION OF LEARNED ASSESSING OFFICER IN NOT DISPOSING THE OBJECTION RAISED BY THE APPELLANT FOR REASSESSMENT PROCEEDING BY PASSING THE SPEAKING ORDER, WITHOUT CONSIDERING THE FACT AND CIRCUMSTANCES OF THE CASE. 3) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS IN LAW, THE LEARNED CIT(A) AS WELL AS THE LEARNED ASSESSING OFFICER HAS ERRED IN PASSING THE ORDER WITHOUT GRANTING SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE APPELLANT. ITA NO.7432/MUM/2016. SHRI ALKESH S. PAREKH. 2 4) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS IN LAW, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ACTION OF LEARNED ASSESSING OFFICER IN MAKING AN ADDITION OF RS.34,44,340/- AS ALLEGED UNEXPLAINED INVESTMENTS U/S. 69 OF THE INCOME TAX ACT, 1961, WITHOUT CONSIDERING THE FACT AND CIRCUMSTANCES OF THE CASE. 5) THE APPELLANT CRAVES LEAVE TO ADD, AMEND, ALTER OR DELETE THE SAID GROUND OF APPEAL. 2. IN THIS CASE THE ASSESSING OFFICER REQUESTED THE ASSESSEE TO EXPLAIN THE SOURCE OF INVESTMENT OF RS.31,37,150 FOR PURCHASE OF TWO FLATS AT H2 BELVEDERE, AUNTH, PUNE ON 30.08.2005. IN THE ABSENCE OF ANY DOCUMENTARY PROOF CORROBORATING THE ABOVE, THE A.O. HELD THAT THERE WAS NO EXPLANATION. ACCORDINGLY, HE MADE THE IMPUGNED ADDITION. 3. BEFORE THE LEARNED CIT(A), THE ASSESSEE CHALLENGED BOTH THE REOPENING AS WELL AS MERITS OF THE CASE. THE ISSUE OF REOPENING WAS DISMISSED BY THE LEARNED CIT(A). HE INTER ALIA, PLACED RELIANCE UPON THE DECISION OF THE HONBLE APEX COURT IN THE CASE OF ACIT V. RAJESH JHAVERI STOCK BROKERS (P.) LTD. 291 ITR 500 (SC). ON THE ISSUE OF MERITS, THE LEARNED CIT(A) NOTED THAT ASSESSEE HAS ALSO SOUGHT TO FILE ADDITIONAL EVIDENCE. THE LEARNED CIT(A) NOTED THAT THIS ADDITIONAL EVIDENCE WAS IN THE FORM OF SALE DEED, MUNICIPAL CORPORATION DOCUMENTS ETC., BUT NO DOCUMENTATION REGARDING SOURCE WAS GIVEN. HENCE, THE LEARNED CIT(A) DID NOT ADMIT THE ADDITIONAL EVIDENCE. THE LEARNED CIT(A) FURTHER NOTED THAT INSPITE OF NUMBER OF NOTICES FOR PERSONAL HEARING, THE AR HAS CHOSE TO FILE WRITTEN SUBMISSION. THAT FURNISHING A BANK ACCOUNT STATEMENT CAN ONLY PROVE THE GENUINENESS OF THE TRANSACTION, BUT NOT THE SOURCE. HENCE, HE DISMISSED THE ASSESSEES APPEAL. ITA NO.7432/MUM/2016. SHRI ALKESH S. PAREKH. 3 4. AGAINST THE ABOVE ORDER, THE ASSESSEE IS IN APPEAL BEFORE THE ITAT. 5. I HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. I FIND THAT ASSESSEES GROUNDS RELATING TO REOPENING INCLUDED THE OBJECTION THAT A.O. HAS ERRED IN NOT DISPOSING THE OBJECTION RAISED BY THE ASSESSEE FOR REASSESSMENT PROCEEDINGS BY PASSING A SPEAKING ORDER. THE LEARNED CIT(A) IN HIS ENTIRE ORDER HAS REFERRED TO CERTAIN CASE LAWS AND THEREAFTER REJECTED THE ASSESSEES GRIEVANCE ON REOPENING. I FIND THAT MERELY CITING CERTAIN CASE LAWS CANNOT ENTITLE THE LEARNED CIT(A) TO DISMISS THE IMPORTANT ISSUE OF REOPENING INCLUDING THE ISSUE THAT A.O. HAS NOT DISPOSED OFF THE OBJECTION TO REASSESSMENT. FURTHERMORE, I NOTE THAT THE LEARNED CIT(A) HAS ALSO DRAWN ANY ADVERSE INFERENCE THAT ASSESSEE HAS NOT PERSONALLY APPEARED BUT HAS ONLY SUBMITTED WRITTEN SUBMISSION. I FIND THAT DRAWING ADVERSE INFERENCE ON THIS GROUND ALSO IS NOT SUSTAINABLE. FURTHER, WHILE REJECTING THE ADDITIONAL EVIDENCE THE LEARNED CIT(A) HAS MENTIONED THAT THE ADDITIONAL EVIDENCE DID NOT DISCLOSE THE SOURCE OF FUND AND THE SAME COMPRISED OF ONLY REGISTRATION DEED ETC. BUT ON THE OTHER HAND IN ANOTHER PART OF THE ORDER, THE LEARNED CIT(A) HAS HIMSELF MENTIONING THAT ASSESSEE HAS SUBMITTED BANK STATEMENT. 6. IN THE BACKGROUND OF ABOVE DISCUSSION I FIND THAT THE LEARNED CIT(A)S ORDER IS NOT SUSTAINABLE IN LAW INASMUCH AS IT DOES NOT ADDRESS THE MERITS OF THE ASSESSEES SUBMISSION. THE DISMISSAL OF ADDITIONAL EVIDENCE IS ALSO CONTRADICTORY. HENCE IN THE INTEREST OF JUSTICE, I REMIT THE ISSUES RAISED IN THIS APPEAL TO THE FILE OF THE LEARNED CIT(A). THE LEARNED CIT(A) IS DIRECTED TO CONSIDER THE ISSUE AFRESH AND PASS A SPEAKING ORDER ON THE ISSUES RAISED. ITA NO.7432/MUM/2016. SHRI ALKESH S. PAREKH. 4 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THIS 01 ST DAY OF SEPTEMBER, 2017. SD/- ( SHAMIM YAHYA ) ACCOUNTANT MEMBER MUMBAI; DATED : 01 ST SEPTEMBER, 2017. DEVDAS* / COPY OF THE ORDER FORWARDED TO : / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT, MUMBAI. 4. / CIT(A), MUMBAI 5. , , / DR, ITAT, MUMBAI 6. [ / GUARD FILE.