Shri Mukesh Babubhai Patel, Vadodara V. The Income Tax Officer, Ward-1(2)(1), Vadodara

ITA 758/AHD/2017

• Counselvise Citation: [2018] 112 COUNSELVISE.COM (IT) 5563 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-11-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 28-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHIV SEWAK
• Keywords: Unexplained investment; Business income; Additional evidence; Set aside
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER & MS. MADHUMITA ROY, JUDICIAL MEMBER I.T.A. NO.758/AHD/2017 (ASSESSMENT YEAR : 2013-14) SHRI MUKESH BABUBHAI PATEL, B- 8, GOKUL, LALBAUG SOCIETY, MANJALPUR, VADODARA 390 010. VS. THE ITO, WARD 1(2)(1), VADODARA [PAN NO. AAQPP 6537 M] ( APPELLANT ) .. ( RESPONDENT ) APPELLANT BY : SHRI MUKUND BAKSHI, A.R. RESPONDENT BY : SHRI SHIV SEWAK, SR. D.R. DATE OF HEARING 24/08/2018 DATE OF PRONOUNCEMENT 12/11/2018 O R D E R PER MS. MADHUMITA ROY - JM: THE INSTANT APPEAL HAS BEEN FILED BEFORE US BY THE ASSESSEE AGAINST THE ORDER DATED 19.01.2017 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS)-2, VADODARA UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 (T HE ACT) ARISING OUT OF THE ORDER DATED 27.01.2016 FOR THE ASSESSMENT YEAR 2013-14 WI TH THE FOLLOWING GROUNDS: 1) THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-2, VADODARA HAS ERRED IN FACTS AND IN LAW IN CONFIRMING THE ADDITION OF AN A MOUNT OF RS. 8,00,000/- ALLEGED AS UNEXPLAINED INVESTMENT IN THE PURCHASE O F LAND. IT IS PRAYED THAT THE ABOVE ADDITIONS MADE BY LD. A.O. AND CONFIRMED BY LD. CIT(A) MAY PLEASE BE DELETED. 2) YOUR APPELLANT CRAVES THE LIBERTY TO ADD, AL TER, AMEND OR DELETE ANY OR ALL THE GROUND(S) OF APPEAL STATED ABOVE. 2. THE BRIEF FACT LEADING TO THE CASE IS THIS THAT THE ASSESSEE HAS PURCHASED THE LAND LOCATED AT MOJE MANJALPUR, VADODARA ON 26.12.2012 F OR CONSIDERATION OF RS. 37,00,000/-. - 2 - ITA NO.758/AHD/2017 SHRI MUKESH B PATEL VS. ITO ASST.YEAR 2013-14 3. THE SAID SALE CONSIDERATION WAS PAID THROUGH ACC OUNT PAYEE CHEQUES OUT OF WHICH 2 CHEQUES OF RS.5,50,000/- AND RS.5,00,000/- WERE N OT CLEARED. 4. THE ASSESSEE WAS ASKED TO EXPLAIN THE SAME BY TH E LEARNED AO UPON WHICH THE ASSESSEE FURNISHED FURTHER DETAILS OF PAYMENT OF RS .2,50,000/- MADE ON 15.11.2013 VIDE CHEQUE NO 60201. THE BALANCE AMOUNT OF RS.8,00,000/ - REMAINED UNPAID. THE ASSESSEES CASE IS THIS THAT CERTAIN DOCUMENTS RELATING TO THE PROPERTY WHICH WERE SUPPOSED TO BE HANDED OVER BY THE VENDER NAMELY MR. PARESH SHAH WA S NOT GIVEN TO THE ASSESSEE AT THE TIME OF EXECUTION OF SALE DEED AND THUS THE AMOUNT HAS BEEN REMAINED DUE TO BE PAID TO THE VENDER TILL THE DOCUMENTS ARE MADE AVAILABLE TO THE ASSESSEE. HE, HOWEVER, COULD NOT PRODUCE ANY CONFIRMATION TO THAT EFFECT FROM THE SA ID PARESH SHAH BECAUSE OF THE PARTICULAR REASON THAT THE SAID MR. PARESH SHAH WAS OUT OF COUNTRY IN USA DURING THE RELEVANT PERIOD OF TIME. THE ASSESSEE FURTHER ADDED THAT IT WAS A MUTUAL UNDERSTANDING BETWEEN THE PARTIES THAT AS AND WHEN THE DOCUMENTS WOULD BE MADE AVAILABLE TO THE ASSESSEE BY THE VENDER, THE BALANCE AMOUNT OF RS.8, 00,000/- WOULD BE PAID TO THE SAID VENDER. HOWEVER, THE CONTENTION MADE BY THE ASSESSE E WAS THOUGH TAKEN INTO CONSIDERATION BUT NOT ACCEPTED BY THE LEARNED ASSES SING OFFICER. ACCORDING TO THE LEARNED ASSESSING OFFICER WHEN THE TRANSACTION HAVE BEEN COMPLETED THE SAID SUM COULD NOT HAVE BEEN KEPT DUE AND THUS ACCORDING TO HIM TH E SAID AMOUNT HAS ALREADY BEEN PAID BY THE ASSESSEE WHICH REMAINED UNDISCLOSED BEFORE H IM. THOUGH, IN THE ABSENCE OF ANY CONCLUSIVE EVIDENCE ON THE BASIS OF PRESUMPTION AND PERSONAL BELIEF ADDITION OF THE SAID AMOUNT HAS BEEN MADE AS UNEXPLAINED INVESTMENT. 5. IN APPEAL, THE LEARNED CIT(A) REITERATED THE SAM E VIEW TAKEN BY THE LEARNED AO AND CONFIRMED THE SAME UNDER THE INSTANT APPEAL. 6. AT THE TIME OF HEARING OF THE INSTANT APPEAL, TH E LEARNED REPRESENTATIVE OF THE ASSESSEE CONTENDED BEFORE US THAT THE ASSESSEE COUL D OBTAIN THE CONFIRMATION OF MR. - 3 - ITA NO.758/AHD/2017 SHRI MUKESH B PATEL VS. ITO ASST.YEAR 2013-14 PARESH SHAH DULY STATING THAT THE SUM OF RS.8,00,00 0/- IS STILL OUTSTANDING AS PER MUTUAL UNDERSTANDING AND PERSONAL RELATIONS BETWEEN THEM H AS BEEN PLACED BEFORE THE LEARNED CIT(A) BY WAY OF AN ADDITIONAL EVIDENCE SATISFYING THE CONDITION OF RULE 46A; THE SAID ADDITIONAL EVIDENCE WAS NOT TAKEN INTO CONSIDERATIO N BY THE LEARNED CIT(A). HE, THEREFORE, PRAYS BEFORE US TO CONSIDER THAT PARTICU LAR EVIDENCE BEING PART OF THE RECORD FOR KIND CONSIDERATION OF THE MATTER. HE, THUS PRAYS FO R DELETING OF ADDITION OF RS.8,00,000/- ON THE BASIS OF SUCH ADDITIONAL DOCUMENTS PLACED BE FORE THE LEARNED CIT(A). ON THE OTHER HAND, THE LEARNED DEPARTMENT REPRESENTATIVE R ELIES UPON THE ORDER PASSED BY THE AUTHORITIES BELOW. 7. WE HAVE HEARD THE LEARNED COUNSEL APPEARING FOR THE PARTIES, WE HAVE PERUSED THE RELEVANT MATERIALS AVAILABLE ON RECORD. WE FIND FRO M THE ORDER PASSED BY THE LEARNED AO THAT THE PLEA TAKEN BY THE ASSESSEE THAT THE BALANC E AMOUNT OF RS.8,00,000/- WAS NOT PAID TO THE VENDER SINCE THE DOCUMENTS RELATING TO THE P ROPERTY WAS NOT HANDED OVER TO HIM AT THE TIME OF ACQUISITION OF SALE DEED AND THE SAME W OULD BE MADE AVAILABLE AT THE TIME DELIVERY OF THOSE DOCUMENTS TO THE ASSESSEE WAS THO UGH TAKEN INTO CONSIDERATION BY THE LEARNED ASSESSING OFFICER, THE SAME WAS REJECTED IN THE ABSENCE OF COGENT DOCUMENT BEING CONFIRMATION OF SUCH FACT BY THE VENDER. AS A RESULTANT EFFECT THE ADDITION HAS BEEN MADE. WE FIND THAT THE SAID CONFIRMATION HAS NOT BE EN TAKEN INTO CONSIDERATION IN ITS PROPER PROSPECTIVE AND THE LEARNED CIT(A) REITERATE D THE STAND TAKEN BY THE LEARNED AO AND CONFIRMED THE SAID ADDITION WITHOUT ANY BASIS W HATSOEVER. IT IS NEEDLESS TO MENTION THAT IT IS THE DUTY OF LEARNED CIT(A) TO TAKE INTO CONSIDERATION OF THE ADDITIONAL EVIDENCE SO PLACED BY THE ASSESSEE IN TERMS OF THE SPECIFIC PROVISION U/S 46A OF THE ACT. IN THIS PARTICULAR CASE, THE ASSESSEE SOUGHT TO JUSTIFY HIS STAND THAT THE SAID DOCUMENT BEING THE CONFIRMATION WAS NOT MADE AVAILABLE WITH HIM SINCE THE VENDER WAS OUT OF THE COUNTRY AND HE THEREFORE, WAS PREVENTED BY SUFFICIENT CAUSE FROM PRODUCING THE SAME BEFORE THE LEARNED ASSESSING OFFICER AS ASKED FOR. IT IS THE D UTY INCUMBENT UPON THE AUTHORITIES BELOW TO TAKE INTO CONSIDERATION ADDITIONAL EVIDENC ES SO PLACED BEFORE IT IF IT SATISFIES THE - 4 - ITA NO.758/AHD/2017 SHRI MUKESH B PATEL VS. ITO ASST.YEAR 2013-14 CONDITIONS MENTIONED ABOVE. COPY OF THE SAID CONFIR MATION IS ALSO A PART OF THE PAPER BOOK FILED BY THE ASSESSEE BEFORE US WHICH SPEAKS A S FOLLOWS: I HAVE RECEIVED A SUM OF RS.29,00,000/- (RS. TWENT Y NINE LACS) AGAINST THE TOTAL SALES CONSIDERATION OF RS.37,00,000/- TILL 15.11.20 13 FROM MR. MUKESH PATEL OF SANKALP DEVELOPERS. BALANCE OF RS.8,00,000/- (RS. E IGHT LACS) IS STILL OUTSTANDING AS PER OUR MUTUAL UNDERSTANDING AND PERSONAL RELATI ONS WITH EACH OTHER. 8. WE, THEREFORE, FIND NO REASON TO MAKE SUCH ADDIT ION OF RS.8,00,000/- BY THE AUTHORITIES BELOW IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND FIND IT FIT AND PROPER TO MEET THE ENDS OF THE JUSTICE TO SET ASIDE THE ORDER TO THE FILE OF THE LEARNED ASSESSING OFFICER TO TAKE INTO CONSIDERATION THE CONFIRMATION MADE BY THE VENDER NAMELY MR. PARESH SHAH FOR ADJUDICATION OF THE MATTER AFRESH I N THE LIGHT OF THE OBSERVATION MADE HEREINABOVE. WE, HOWEVER, MAKE IT CLEAR THAT AT THE TIME OF ADJUDICATION OF THE MATTER THE ASSESSEE MUST BE GIVEN OPPORTUNITY OF HEARING BY TH E LEARNED ASSESSING OFFICER AND FURTHER THAT THE LEARNED ASSESSING OFFICER WILL ALS O TAKE INTO CONSIDERATION ANY FURTHER DOCUMENT WHICH THE ASSESSEE MAY RELY UPON AT THE TI ME OF HEARING OF THE MATTER. 9. IN THE RESULT, THE ASSESSEES APPEAL IS HEREBY A LLOWED FOR STATISTICAL PURPOSES. THIS ORDER PRONOUNCED IN OPEN COURT ON 12/11/2018 SD/- SD/- ( WASEEM AHMED ) ( MS. MADHUMITA ROY ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 12/11/2018 PRITI YADAV, SR.PS - 5 - ITA NO.758/AHD/2017 SHRI MUKESH B PATEL VS. ITO ASST.YEAR 2013-14 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. () / THE CIT(A)-2, VADODARA. 5. , ! ' , #$%% / DR, ITAT, AHMEDABAD 6. &' () / GUARD FILE. / BY ORDER, //TRUE COPY// / ( DY./ASSTT.REGISTRAR) !, #$ / ITAT, AHMEDABAD