SHREE APSARA JEWELLERS, MUMBAI V. ITO 23(1)(2), MUMBAI

ITA 7721/MUM/2014

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 1768 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-12-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 26-12-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K RAVIKIRAN
• Keywords: Source of fund
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC, MUMBAI BEORE SHRI G.S.PANNU, ACCOUNTANT MEMBER ITA NO. 7721/MUM/2014 (ASSESSMENT YEAR : 2009-10) SHREE APSARA JEWELLERS, SHOP NO.4, ISHWAR NIWAS, STATION ROAD, BHANDUP WEST, MUMBAI 400 078 PAN: ABDFS 2223D ... APPELLANT VS. THE ITO 23(1)(2) MUMBAI. .... RESPONDENT APPELLANT BY : SHRI MEHUL SHAH RESPONDENT BY : SHRI K. RAVI KIRAN DATE OF HEARING : 12/10/2015 DATE OF PRONOUNCEMENT : 30/10/2015 ORDER PER G.S. PANNU,AM: THE CAPTIONED APPEAL IS PREFERRED BY THE ASSES SEE AND IS DIRECTED AGAINST THE IMPUGNED ORDER DATED 27/06/ 2014 OF CIT(A)-7, MUMBAI, PERTAINING TO THE ASSESSMENT YEAR 2009-10, WHICH IN-TURN HAS ARISEN FROM AN ORDER PASSED BY THE ASSESSING OFFICE R DATED 21/12/2011 UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961( I N SHORT THE ACT). 2. IN THIS APPEAL THE SOLITARY GRIEVANCE OF THE AS SESSEE IS WITH REGARD TO AN ADDITION OF RS.2.00 LACS MADE BY THE ASSESSIN G OFFICER ON ACCOUNT OF LOW WITHDRAWALS BY THE PARTNERS. 2 ITA NO. 7721/MUM/2014 (ASSESSMENT YEAR : 2009-10) 3. AT THE TIME OF HEARING, IT WAS NOTED THAT APP EAL OF THE ASSESSEE WAS BELATED BY 90 DAYS AND LD. REPRESENTATIVE FOR T HE ASSESSEE SUBMITTED THAT THE DELAY BE CONDONED AS IT WAS ON ACCOUNT OF REASONS BEYOND THE CONTROL OF THE ASSESSEE. THE APPELLANT HAS ALSO PLACED ON RECORD AN AFFIDAVIT DATED 24/12/2014 OF MR. ANIL S.CHORDIA, PARTNER OF THE ASSESSEE FIRM AVERRING THE REASONS FOR THE DELA Y IN FILING OF THE APPEAL. 4. I HAVE PERUSED THE REASONS FOR THE DELAY, CONTAI NED IN THE AFFIDAVIT, WHICH READ AS UNDER:-- 7. THE ORDER WAS SERVED UPON YOUR APPELLANT ON JUL Y 28, 2014. AT THIS POINT OF TIME, MANAGING PARTNER MR. ANIL S CHORDIA WAS O UT OF STATION. THE ORDER WAS KEPT IN ONE OF HIS DRAWERS BY HIS STAFF M EMBERS; AND WAS NEVER COMMUNICATED TO HIM AS TO RECEIPT OF THIS ORDER. 8.DURING MID DECEMBER WHEN YOUR APPELLANT WAS SEARC HING FOR SOME OTHER PAPERS, HE CAME ACROSS THE ORDER OF LEARNED COMMISS IONER OF INCOME-TAX (APPEAL). HE IMMEDIATELY SENT A COPY THIS ORDER TO HIS CHARTERED ACCOUNTANT WHO IN TURN ADVISED HIM TO FILE THIS APPEAL WITH A PRAYER FOR CONDONATION OF DELAY. 9. WHATEVER HAS HAPPENED IS OWING TO MISCOMMUNICATI ON IN OFFICE OF YOUR APPELLANT AND WAS NOT INTENTIONAL FOR WHICH YOUR A PPELLANT COULD NOT FILE THE APPEAL WITHIN THE PRESCRIBED AND NOW IS FACED WITH THE EMBARRASSING SITUATION 5. LD. DEPARTMENTAL REPRESENTATIVE APPEARING FOR THE REVENUE HAS NOT ASSAILED THE BONAFIDES OF THE REASONS AND, THER EFORE, I DEEM IT FIT AND PROPER TO CONDONE THE DELAY IN FILING OF THE AP PEAL. 6. THE BACKGROUND OF THE DISPUTE IS THAT THE APPELL ANT IS A PARTNERSHIP FIRM, WHICH IS ENGAGED IN THE BUSINESS OF TRADING IN GOLD AND SILVER JEWELLERY. FOR THE ASSESSMENT YEAR 2009-10, IT FILED A RETURN OF INCOME DECLARING NIL INCOME, WHICH WAS SUBJECT T O SCRUTINY ASSESSMENT, WHEREBY THE TOTAL INCOME WAS ASSESSED AT RS.5,71,930/- 3 ITA NO. 7721/MUM/2014 (ASSESSMENT YEAR : 2009-10) ONE OF THE ADDITIONS MADE TO THE RETURNED INCOME I S AN AMOUNT OF RS.2.00 LACS ON ACCOUNT OF LOW WITHDRAWALS BY THE P ARTNERS. ON THIS ASPECT, THE ASSESSING OFFICER NOTED THAT THE CUMULA TIVE WITHDRAWAL OF THE PARTNERS FROM THE ASSESSEE FIRM WAS QUITE LOW I N COMPARISON TO THEIR LIVING STANDARDS AND STATUS. THEREFORE, HE A DDED BACK AN AMOUNT OF RS.2.00 LACS ON ACCOUNT OF LOW WITHDRAWAL BY THE PARTNERS FOR FOR THEIR HOUSEHOLD EXPENSES. THE SAID ADDITION HAS A LSO BEEN UPHELD BY THE CIT(A). 7. AFTER CONSIDERING THE ORDERS OF AUTHORITIES BELO W AS WELL AS SUBMISSIONS PUT FORTH BEFORE ME, I FIND THAT THE AC TION OF THE LOWER AUTHORITIES IS COMPLETELY MISCONCEIVED. EVEN IF IT HAS TO BE ACCEPTED THAT THERE WAS INSUFFICIENCY OF WITHDRAWALS BY THE PARTNERS TO MEET THEIR HOUSEHOLD EXPENDITURE, THERE WAS NO JUSTIFICA TION TO MAKE ANY ADDITION IN THE HANDS OF THE ASSESSEE FIRM BECAUSE IT IS UPTO TO THE INDIVIDUAL PARTNERS TO JUSTIFY AND SUBSTANTIATE THE HOUSEHOLD EXPENSES INCURRED BY THEM. FURTHER, THE LD. REPRESENTATIVE FOR THE ASSESSEE ALSO POINTED OUT THAT ON FACTS ALSO, THERE WAS NO JUSTIF ICATION FOR SUCH ADDITION BECAUSE FAMILY MEMBERS OF THE TWO PARTNERS ALSO HAVE INDIVIDUAL SOURCES OF INCOME, WHICH HAVE BEEN USED TO DEFRAY THE HOUSEHOLD EXPENDITURE OF THE CONCERNED PARTNERS. B E THAT AS IT MAY, IN MY OPINION, SUCH ADDITION IS WHOLLY UNWARRANTED IN THE HANDS OF THE ASSESSEE FIRM. AS A CONSEQUENCE, I SET ASIDE THE O RDER OF CIT(A) AND DIRECT THE ASSESSING OFFICER TO DELETE THE ADDITION OF RS.2.00 LACS MADE TO THE INCOME OF THE ASSESSEE FIRM. 4 ITA NO. 7721/MUM/2014 (ASSESSMENT YEAR : 2009-10) 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED AS ABOVE ORDER PRONOUNCED IN THE OPEN COURT ON 30/10/2015. SD/- (G.S. PANNU) ACCOUN TANT MEMBER MUMBAI, DATED 30/10/2015 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT , 2. THE RESPONDENT. 3. THE CIT(A)- 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI VM , SR. PS