ITO WD 3(1), THANE V. SUR ISLAM SAEED KHAN, THANE

ITA 7693/MUM/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 1497 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-12-2016
• Appeal Filed By: Department
• Bench Allotted: E
• Assessment Year: 2010-2011
• Appeal Filed On: 26-12-2014
• Court: TRIBUNAL
• Department Lawyers: T A KHAN
• Assessee Lawyers: SANJAY R PARIKH
• Keywords: Principle of natural justice; Peak credit
• Section: 143(3)

Judgement Text

, , E, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E, MUMBAI BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER, AND SHRI ASHWANI TANEJA, ACCOUNTANT MEMBER ITA NO.7693/MUM/2014 ASSESSMENT YEAR: 2010-11 ITO WD 3(1) R.NO.02, 6 TH FLOOR, ASHAR IT PARK MIDC WAGLE INDL. ESTATE RD. NO.16Z THANE(W) / VS. N UR ISLAM SAEED KHAN, 304, 3 RD FLOOR, EBRAHIM MANZIL, BOMBAY COLONY DIST-THANE ( REVENUE ) (RESPONDENT ) P.A. NO. AAPPK1233L REVENUE BY SHRI T.A KHAN (DR) RESPONDENT BY SHRI SANJAY R. PARIKH (AR) / DATE OF HEARING: 29/11/2016 / DATE OF ORDER: 21/12/2016 / O R D E R PER ASHWANI TANEJA (ACCOUNTANT MEMBER): THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST ORDER OF LD. COMMISSIONER OF INCOME TAX(APPEALS), MUMBAI- I (IN SHORT CIT(A)}, DATED 12.09.2014 PASSED ORDER AGAI NST U/S 143(3) OF THE ACT, DATED 28.03.2013 FOR ASSESSMENT YEAR 2010- 11 ON THE FOLLOWING GROUNDS: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, AND IN LAW, THE ID. C1T(A)-I, THANE HAS NOT APPRECI ATED THE FACT THAT THE ASSESSEE COULD NOT FILE ANY EVIDE NCE IN SUPPORT OF DISTRIBUTION OF MONEY AND THEREFORE THE NUR ISLAM S.KHAN 2 SOURCE OF CASH DEPOSITS REMAINS UNEXPLAINED. 2. THE APPELLANT PRAYS THE ORDER OF THE LD. CIT(A)- I, THANE, MAY BE VACATED AND THAT OF THE ASSESSING OFFICER BE RESTORED. 3. THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR ALTE R ANY GROUND/GROUNDS, WHICH MAY BE NECESSARY. 2. DURING THE COURSE OF HEARING, ARGUMENTS WERE MADE BY SHRI SANJAY R. PARIKH, AUTHORISED REPRESENTATIVES ( AR) ON BEHALF OF THE ASSESSEE AND BY SHRI T.A KHAN, DEPART MENTAL REPRESENTATIVE (CIT-DR) ON BEHALF OF THE REVENUE. 3. THE ONLY EFFECTIVE GROUND RAISED IN THIS APPEAL BY THE REVENUE IS WITH REGARD TO ADDITION DELETED BY THE L D. CIT(A) WHICH WAS MADE BY THE AO ON ACCOUNT OF CASH DEPOSIT ED BY THE ASSESSEE IN ITS BANK ACCOUNT WHICH REMAINED UNE XPLAINED AS PER VIEWS OF THE AO. 3.1. THE BRIEF FACTS IN THIS REGARD ARE THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS, IT WAS NOTED BY THE AO THAT THE ASSESSEE HAD MADE DEPOSIT OF CASH IN ITS BANK ACCOU NTS AT VARIOUS OCCASIONS AGGREGATING TO RS.64,51,000/- WHI CH REMAINED UNEXPLAINED AND UNSUBSTANTIATED BY THE ASS ESSEE. 3.2. IN THE APPEAL BEFORE THE LD. CIT(A), THOUGH HE PRI NCIPALLY AGREED WITH THE VERSION OF THE AO THAT THE CASH DEP OSITED WAS UNEXPLAINED AND UNSUBSTANTIATED, BUT HE RECOMPUTED THE AMOUNT OF ADDITION BY RESTRICTING THE ADDITION TO T HE AMOUNT OF PEAK CREDIT. 3.3. BEING AGGRIEVED, THE REVENUE FILED AN APPEAL BEFOR E THE TRIBUNAL, WHEREAS THE ASSESSEE ACCEPTED THE ADDITIO N SUSTAINED BY THE LD. CIT(A). 3.4. DURING THE COURSE OF HEARING BEFORE US, IT WAS SUB MITTED BY THE LD. DR THAT NO PLEADING OF ADDITION ON THE B ASIS OF PEAK NUR ISLAM S.KHAN 3 CREDIT WAS EVER RAISED BY THE ASSESSEE BEFORE THE A O. IT WAS RAISED FOR THE FIRST TIME BEFORE THE LD. CIT(A) WHO ACCEPTED THE SUBMISSIONS OF THE ASSESSEE WITHOUT GIVING ANY BASI S OF WORKING OUT THE PEAK CREDIT IN THE APPEAL ORDER PAS SED BY THE LD. CIT(A). FURTHER, LD. CIT(A) DID NOT CONFRONT TH E WORKING OF PEAK CREDIT TO THE AO AND THUS VIEWS OF THE AO WERE NOT OBTAINED WITH REGARD TO THE FRESH PLEADING TAKEN BY THE ASSESSEE FOR THE FIRST TIME BEFORE THE LD. CIT(A). THUS, THE ORDER PASSED BY THE LD. CIT(A) IS IN VIOLATION OF P RINCIPLES OF NATURAL JUSTICE AND THEREFORE, THIS MATTER SHOULD B E SENT BACK TO THE FILE OF THE AO. 3.5. PER CONTRA, LD. COUNSEL OF THE ASSESSEE VEHEMENTLY SUPPORTED THE ORDER OF THE LD. CIT(A) AND DREW OUR ATTENTION ON VARIOUS EVIDENCES FILED IN THE PAPER BOOK AND RE QUESTED FOR UPHOLDING THE ORDER OF LD. CIT(A). 3.6. WE HAVE GONE THROUGH THE ORDER PASSED BY THE LOWER AUTHORITIES AS WELL AS SUBMISSIONS MADE BY BOTH THE SIDES BEFORE US. IT IS NOTED THAT THE PLEADING WITH REGAR D THE ADDITION OF PEAK CREDIT WAS MADE BY THE ASSESSEE FOR THE FIR ST TIME BEFORE THE LD. CIT(A). BUT HE HAS NOT GIVEN IN THE APPEAL ORDER ANY BASIS OF COMPUTATION WITH REGARD TO WORKING OUT COMPUTATION OF PEAK CREDIT. FURTHER, THE SUBMISSION S AND EVIDENCES WITH REGARD TO ADDITION ON THE BASIS OF P EAK CREDIT WERE NEITHER FORWARDED TO AO BY LD. CIT(A) NOR THE VIEWS OF AO WERE CONSIDERED ON THIS ASPECT. EVEN DURING THE COU RSE OF HEARING BEFORE US, NOTHING WAS SHOWN WITH REGARD TO BASIS OF COMPUTATION OF PEAK CREDIT. IN THESE PECULIAR FACTS AND CIRCUMSTANCES, WE FIND THAT THE ORDER PASSED BY THE LD. CIT(A) NUR ISLAM S.KHAN 4 IS IN VIOLATION OF PRINCIPLES OF NATURAL JUSTICE AN D WITHOUT THE SUPPORT OF ANY MATERIAL. THUS, WE FIND FORCE IN THE SUBMISSIONS MADE BY THE LD. DR AND FIND IT APPROPRI ATE TO SEND THIS ISSUE BACK TO THE FILE OF THE AO. THE ASS ESSEE SHALL SUBMIT REQUISITE DETAILS AND EVIDENCES BEFORE THE A O TO SHOW THE BASIS OF COMPUTING PEAK CREDIT. THE AO SHALL GI VE ADEQUATE OPPORTUNITY OF HEARING TO THE ASSESSEE AND SHALL PA SS FRESH ORDER AFTER CONSIDERING ENTIRE MATERIAL AS MAY BE P LACED ON RECORD BY THE ASSESSEE. THUS, WITH THESE DIRECTIONS THE ISSUES RAISED BY THE DEPARTMENT IN ITS APPEAL ARE SENT BAC K TO THE FILE OF THE AO. 4. IN THE RESULT, THE APPEAL OF THE REVENUE IS TREATE D AS ALLOWED FOR STATISTICAL PURPOSES. ORDER WAS PRONOUNCED IN THE OPEN COURT AT THE CONCL USION OF THE HEARING. SD/- (MAHAVIR SINGH ) SD/- (ASHWANI TANEJA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 21 /12/2016 CTX? P.S/. .. !'#$%&%'# / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT, MUMBAI. 4. / CIT(A)- , MUMBAI 5. #$% &' , &' ) , / DR, ITAT, MUMBAI 6. %*+ , / GUARD FILE. NUR ISLAM S.KHAN 5 / BY ORDER, # //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI