Shri Girishbhai R Patel, Mumbai V. ITO, International Taxation, Surat, Surat

ITA 758/SRT/2018

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 5347 (ITAT-SURAT)
• Duration Of Justice: 2 year(s) 8 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-09-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 06-12-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANUPAMA SINGLA
• Keywords: Unexplained investment; TDS
• Section: 142(1); 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER ITA NO.758/SRT/2018 (AY 2010-11) (H EARING IN VIRTUAL COURT) SHRI GIRISHBHAI R PATEL, A-93, PL-A, PRANEK GARDEN, PANCHASHEEL ENCL. DAHANUKARWADI OFF. M.G. ROAD, MUMBAI PAN : AXNPP 4064 B VS. THE INCOME TAX OFFICER, INTERNATIONAL TAXATION, ANAVIL BUSINESS CENTRE, ADAJAN, SURAT. APPLICANT RESPONDENT ASSESSEE BY SHRI SAPNESH R SHETH, C.A REVENUE BY MS. ANUPAMA SINGLA SR.DR DATE OF HEARING 03.09.2021 DATE OF PRONOUNCEMENT 03.09.2021 ORDER UNDER SECTION 254(1) OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER : 1. THIS APPEAL BY ASSESSEE IS DIRECTED AGAINST THE ORDERS OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-13, AHMEDABAD DATED 19.09.2018 FOR THE ASSESSMENT YEAR (AY) 2010-11.THE ASSESSEE RAISED THE FOLLOWING GROUNDS OF APPEAL: 1) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AS WELL AS LAW ON THE SUBJECT, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) HAS ERRED IN PASSING EX-PARTE ORDER ALTHOUGH AR OF THE ASSESSEE HAS DULY FIELD SUBMISSION IN THE FIRST HEARING BEFORE LD.CIT(A)& ALSO AS PER THE KNOWLEDGE OF ASSESSEE, MATTER WAS REMANDED TO THE FILE OF ASSESSING OFFICER. 2) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AS WELL AS LAW ON THE SUBJECT, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) HAS ERRED IN CONFIRMING THE ACTION OF ASSESSING OFFICE IN REOPENING ASSESSMENT BY ISSUING NOTICE U/S148 OF THE OF THE I.T. ACT, 1961 3) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AS WELL AS LAW ON THE SUBJECT, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN CONFIRMING THE ACTION OF ASSESSING OFFICE IN PASSING ADDITION EX-PARTE ORDER U/S 144 OF THE I.T. ACT, 1961. ITA NO.758/SRT/2018 SHRI GIRISHBHAI R PATEL (A.Y2010-11) 2 4) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AS WELL AS LAW ON THE SUBJECT, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN CONFIRMING THE ACTION OF ASSESSING OFFICE IN MAKING OF RS.10,00,000/- U/S 69 OF THE I.T. ACT, 1961 AS UNEXPLAINED INVESTMENT IN MUTUAL FUNDS. 5) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AS WELL AS LAW ON THE SUBJECT, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN CONFIRMING THE ACTION OF ASSESSING OFFICE IN NOT ALLOWING DEDUCTION OF TDS AMOUNTING TO RS.41,121/- FROM TOTAL TAX DEMAND. 6) IT IS THEREFORE PRAYED THAT ABOVE ADDITION MADE BY ASSESSING OFFICER AND CONFIRMED BY COMMISSIONER OF INCOME-TAX (APPEALS) MAY PLEASE BE DELETED 2. BRIEF FACTS OF THE CASE ARE THAT ASSESSEE IS NON-RESIDENT INDIAN. THE CASE OF THE ASSESSEE WAS REOPENED UNDER SECTION 147. THE CASE WAS REOPENED ON THE BASIS OF INFORMATION THAT DURING THE RELEVANT FINANCIAL YEAR THE ASSESSEE INVESTED RS. 10 LAKHS FOR PURCHASING MUTUAL FUNDS AND ALSO PURCHASED IMMOVABLE PROPERTY OF RS. 50 LAKHS. ON VERIFICATION OF ITD PORTAL IT WAS NOTED BY THE ASSESSING OFFICER (AO) THAT NO RETURN OF INCOME WAS FILED BY THE ASSESSEE. THE AO AFTER RECORDING THE REASONS OF REOPENING ISSUED NOTICE UNDER SECTION 148 TO THE ASSESSEE. THE AO RECORDED THAT NO RETURN OF INCOME WAS FILED BY THE ASSESSEE IN RESPONSE TO THE NOTICE UNDER SECTION 148. THE AO ALSO SERVED NOTICE UNDER SECTION 142(1) FOR SEEKING CERTAIN DETAILS. THE AO FURTHER NOTED THAT DESPITE SERVICE OF SAID NOTICE NO RESPONSE WAS MADE BY THE ASSESSEE. THE AO PROCEEDED TO COMPLETE THE ASSESSMENT AND MADE ADDITION OF RS. 10.00 LAKHS ON ACCOUNT OF INVESTMENT IN MUTUAL FUNDS AS UNEXPLAINED INVESTMENT AND ADDITIONS OF RS. 51.00 LAKHS ON ACCOUNT OF PURCHASED OF ITA NO.758/SRT/2018 SHRI GIRISHBHAI R PATEL (A.Y2010-11) 3 PROPERTY AS UNEXPLAINED INVESTMENT. THE AO FURTHER MADE ADDITION OF RS. 319396/- ON THE BASIS STATEMENT ON FORM-26AS THAT THE ASSESSEE RECEIVED SUCH INCOME FROM BANK OF BARODA. ON APPEAL BEFORE THE LD. CIT(A), THE ADDITION WAS UPHELD. THE LD. CIT(A) UPHELD THE ADDITION IN AN EX PARTE ORDER. THUS, FURTHER AGGRIEVED, THE ASSESSEE HAS FILED PRESENT APPEAL BEFORE THIS TRIBUNAL. 3. WE HAVE HEARD THE SUBMISSION OF LD. AUTHORIZED REPRESENTATIVE (AR) FOR THE ASSESSEE AND LD. SENIOR DEPARTMENTAL REPRESENTATIVE (DR) FOR THE REVENUE AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE LD. AR OF THE ASSESSEE SUBMITS THAT HE HAS RAISED SPECIFIC GROUNDS OF APPEAL THAT THE LD. CIT(A) ERRED IN PASSING EX-PARTE ORDER AND NOT ADJUDICATED THE GROUNDS OF APPEAL ON MERIT. THE LD. AR FOR THE ASSESSEE FURTHER SUBMITS THAT THE ASSESSEE HAS GOOD CASE ON MERIT AND IS LIKELY TO SUCCEED IF ONE MORE OPPORTUNITY IS GRANTED TO THE ASSESSEE TO EXPLAIN THE FACTS BEFORE LD CIT(A). THE LD. AR FOR THE ASSESSEE FURTHER SUBMITS THAT HE UNDERTAKES ON BEHALF OF THE ASSESSEE TO CO-OPERATE AND NOT TO MAKE DEFAULT IN ATTENDING PROCEEDINGS BEFORE THE LD. CIT(A) IN FUTURE. 4. ON THE OTHER HAND THE LD. SR. DR FOR THE REVENUE SUBMITS THAT THE ASSESSEE WAS GIVEN SEVERAL OPPORTUNITIES BY THE LD CIT(A) AS RECORDED IN PARA 2 OF THE ORDER PASSED BY THE LD.CIT(A). THE ASSESSEE FAILED TO COMPLY WITH THE NOTICE ISSUED BY THE LD. CIT(A), THEREFORE, THE LD. CIT(A) LEFT WITH NO OPTION, EXCEPT TO PROCEED TO DECIDE THE ISSUE ON THE ITA NO.758/SRT/2018 SHRI GIRISHBHAI R PATEL (A.Y2010-11) 4 BASIS MATERIAL AVAILABLE ON RECORD. THE ASSESSEE DOES NOT DESERVE ANY FURTHER LENIENCY. IN ALTERNATIVE SUBMISSION, THE LD.SR.DR FOR THE REVENUE SUBMITS THAT IN CASE THE HONBLE TRIBUNAL DEEM APPROPRIATE, RESTORE THE APPEAL TO THE FILE OF LD.CIT(A). THE ASSESSEE BE DIRECTED TO BE VIGILANT IN FUTURE AND NOT TO DEFAULT IN ATTENDING THE PROCEEDINGS AND TO WASTE THE TIME OF PUBLIC AUTHORITIES/LD.CIT(A). 5. WE HAVE CONSIDERED THE RIVAL SUBMISSION OF BOTH THE PARTIES AND HAVE GONE THROUGH THE ORDERS OF LOWER AUTHORITIES. WE FIND THAT THE LD.CIT(A) FIXED THE HEARING ON 21.08.2018 AND IT IS RECORDED BY LD.CIT(A) THAT NO COMPLIANCE WAS MADE BY THE ASSESSEE AS NONE ATTENDED ON BEHALF OF ASSESSEE. HOWEVER, WE FIND THAT THE LD.CIT(A) HAS NOT RECORDED HIS SATISFACTION THAT THE NOTICE WAS SERVED ON THE ASSESSEE OR NOT. WE INSTEAD OF GOING INTO CONTROVERSY, WHETHER THE ASSESSEE DEFAULTED IN ATTENDING THE PROCEEDINGS DESPITE SERVICE OF NOTICE OR NOT, BEFORE THE LD.CIT(A). WE FIND THAT THE ORDER OF THE LD.CIT(A) IS NOT IN ACCORDANCE WITH MANDATE OF SECTION 250(6) OF THE INCOME TAX ACT. SECTION 250(6) OF THE ACT MANDATES THAT THE LD.CIT(A) WHILE DECIDING THE APPEAL IS REQUIRED TO PASS ORDER ON POINTS OF DETERMINATION (GROUNDS OF APPEALS), DECISION THEREIN ON AND REASONS FOR SUCH DECISION. THEREFORE, CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE, THE APPEAL OF THE ASSESSEE IS RESTORED BACK TO THE FILE OF THE LD.CIT(A) TO DECIDE ALL THE GROUNDS OF APPEAL ON MERIT IN ACCORDANCE WITH LAW. NEEDLESS TO ORDER THAT BEFORE ITA NO.758/SRT/2018 SHRI GIRISHBHAI R PATEL (A.Y2010-11) 5 PASSING THE ORDER THE LD.CIT(A) SHALL GRANT FAIR OPPORTUNITY OF HEARING TO THE ASSESSEE. THE ASSESSEE IS ALSO DIRECTED TO APPEAR BEFORE THE LD.CIT(A) AS AND WHEN THE DATE OF HEARING AND TO PROVIDE ALL NECESSARY EVIDENCE AND INFORMATION WITHOUT ANY FURTHER DELAY AND NOT TO SEEK THE ADJOURNMENT WITHOUT ANY VALID REASONS. ACCORDINGLY THE GROUNDS OF APPEAL BY ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSE. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. ORDER ANNOUNCED ON 3 RD SEPTEMBER 2021AT THE TIME OF HEARING IN VIRTUAL COURT HEARING. SD/- SD/- (DR ARJUN LAL SAINI) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER SURAT, DATED: 03/09/2021 / SGR* COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR 6. GUARD FILE BY ORDER / / TRUE COPY / / SR. PVT. SECRETARY, ITAT, SURAT