KISHOR DEOMAL GAMBANI, MUMBAI V. INCOME TAX OFFICER WARD 2(3)(3), MUMBAI

ITA 8/MUM/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 4237 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-03-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2013-2014
• Appeal Filed On: 02-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M RAJAN
• Assessee Lawyers: DAMODAR KABRA
• Keywords: Unexplained expenditure; Capital asset; Opportunity of being heard
• Section: 54F; 54

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL H BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY , JUDICIAL MEMBER AND SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER ITA NO. 8 / MUM . /2018 ( ASSESSMENT YEAR : 20 1 3 14 ) KISHOR DEOMAL GAMBANI 15, REX CHAMBERS BALLARD ESTATE, MUMBAI 400 038 PAN AABPG3169P . APPELLANT V/S INCOME TAX OFFICER WARD 2 ( 3 )( 3 ), MUMBAI . RESPONDENT ASSESSEE BY : SHRI DAMODAR KABRA REVENUE BY : SHRI M. RAJAN DATE OF HEARING 05 .0 3 .201 9 DATE OF ORDER 13.03.2019 O R D E R PER SAKTIJIT DEY, J.M. A FORESAID APPEAL HA S BEEN FILED BY THE ASSESSEE CHALLENGING THE ORDER DATED 3 RD NOVEMBER 2017, PASSED BY THE LEARNED COMMISSIONER (APPEALS) 6 , MUMBAI, PERTAINING TO THE ASSESSMENT YEAR 20 13 14 . 2 . THE ASSESSEE HAS RAISED TWO ISSUES IN THIS APPEAL. THE FIRST ISSUE IS IN RESPECT OF DISALLOWANCE OF CLAIM OF DEDUCTION UNDER SECTION 54F OF 2 KISHOR DEOMAL GAMBANI THE INCOME - TAX ACT, 1961 (FOR SHORT 'THE ACT' ) AND THE SECOND ISSUE RELATES TO THE ADDITION OF EXPENDITURE UNDER SECTIO N 115BBE OF THE ACT. 3 . BRIEF FACTS ARE, THE ASSESSEE IS AN INDIVIDUAL. FOR THE ASSESSMENT YEAR UNDER DISPUTE, THE ASSESSEE FILED HIS RETURN OF INCOME ON 31 ST JULY 2013, DECLARING INCOME OF ` 3,49,33,220. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFI CER NOTICED THAT AGAINST THE LONG TERM CAPITAL GAIN DERIVED FROM SALE OF SHARES, THE ASSESSEE HAS CLAIMED DEDUCTION UNDER SECTION 54F OF THE ACT TOWARDS INVESTMENT MADE IN RESIDENTIAL HOUSE. AS OBSERVED BY THE ASSESSING OFFICER, ON A PERUSAL OF THE DETAILS , HE FOUND THAT, THOUGH, THE ASSESSEE HAD MADE PAYMENT TOWARDS INVESTMENT IN THE RESIDENTIAL HOUSE PRIOR TO SALE OF CAPITAL ASSET BUT TILL THE DATE OF COMPLETION OF ASSESSMENT THE HOUSE HAS NOT BEEN PURCHASED BY THE ASSESSEE. STATING THAT THE CONDITIO N OF SECTION 54F OF THE ACT HAS NOT BEEN SATISFIED , THE ASSESSING OFFICER DISALLOWED ASSESSEES CLAIM OF DEDUCTION UNDER SECTION 54F OF THE ACT AMOUNTING TO ` 63,92,824. FURTHER, O N VERIFICATION OF AIR INFORMATION AVAILABLE ON RECORD, THE ASSESSING OFFICER FOUN D THAT THE ASSESSEE HAS INCURRED EXPENDITURE OF ` 13,50,541, AGAINST CREDIT CARD HELD BY HIM. HOWEVER, THE ASSESSEE COULD FURNISH EVIDENCE WITH REGARD TO PAYMENT OF ` 9,61,737 ONLY. WHEREAS, THE ASSESSEE COULD NOT EXPLAIN/ CLARIFY REGRDING THE BALANCE AMOUN T OF ` 3,89,804. ACCORDINGLY, HE TREATED THE AMOUNT OF ` 3,89,804, AS UNEXPLAINED EXPENDITURE UNDER SECTION 3 KISHOR DEOMAL GAMBANI 115BBE OF THE ACT AND BROUGHT IT TO TAX @ 30%. BEING AGGRIEVED WITH THE AFORESAID ADDITION, THE ASSESSEE PREFERRED APPEAL BEFORE THE FIRST APPELLATE AUTHORITY. 4 . L EARNED COMMISSIONER (APPEALS) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE CONCURRED WITH THE VIEW EXPRESSED BY THE ASSESSING OFFICER ON THE REASONING THAT THE ASSESSEE COULD NOT FURNISH THE RELEVANT DOCUMENTARY EVIDENCE TO JUSTIFY ITS CLAIM OF DEDUCTION UNDER SECTION 54F OF THE ACT. AS REGARDS THE ADDITION UNDER SECTION 115BBE OF THE ACT, LEARNED COMMISSIONER (APPEALS) SUSTAINED THE ADD ITION ALLEGING LACK OF EVIDENCE/ EXPLANATION FURNISHED BY THE ASSESSEE. 5 . T HE LEARNED AUTHORISED REPRESE NTATIVE SUBMITTED , ALL EVIDENCE S AVAILABLE WITH THE ASSESSEE WERE FURNISHED BEFORE THE DEPARTMENTAL AUTHORITIES. IF THE DEPARTMENTAL AUTHORITIES HAD ANY FURTHER DOUBT WITH REGARD TO ASSESSEES CLAIM AND REQUIRED MORE EVIDENCES, THEY SHOULD HAVE DISCLOSED T HEIR MIND TO THE ASSESSEE. HE SUBMITTED , WITHOUT AFFORDING REASONABLE OPPORTUNITY TO THE ASSESSEE TO JUSTIFY HI S CLAIM , DISALLOWANCE MADE IS IMPROPER. THEREFORE, HE SUBMITTED , THE ISSUE S MAY BE RESTORED BACK TO THE ASSESSING OFFICER FOR FRESH ADJUDICATION AFTER CONSIDERING THE EVIDENCE S FILED BY THE ASSESSEE. 4 KISHOR DEOMAL GAMBANI 6 . THE LEARNED DEPARTMENTAL REPRESENTATIVE, THOUGH, RELIED UPON THE OBSERVATIONS OF THE ASSESSING OFFICER, HOWEVER, HE DID NOT EXPRESS ANY SERIOUS OBJECTION IF ONE MORE OPPORTUNITY IS GRANTED TO THE ASSESSEE TO PROVE HIS CLAIM BEFORE THE ASSESSING OFFICER. 7 . WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSED MATERIAL ON RECORD. IT IS EVIDENT FROM THE FA C T AND MATERIAL ON RECORD, BOTH THE DISALLOWANCES DISPUTED IN THE PR ESENT APPEAL WERE MADE PRIMARILY ON THE ALLEGATION THAT THE ASSESSEE FAILED TO FURNISH PROPER DOCUMENTARY EVIDENCE TO JUSTIFY HIS CLAIM. HOWEVER, LEARNED AUTHORISED REPRESENTATIVE HAS SUBMITTED BEFORE US THAT ALL NECESSARY DOCUMENTARY EVIDENCES ARE AVAILAB LE WITH THE ASSESSEE TO JUSTIFY HIS CLAIM AND GIVE N AN OPPORTUNITY, ASSESSEE WOULD BE ABLE TO PROVE ITS CLAIM BOTH WITH REGARD TO THE DEDUCTION UNDER SECTION 54 F OF THE ACT AS WELL AS CREDIT CARD EXPENSES. CONSIDERING THE SUBMISSIONS OF THE LEARNED AUTHORI SED REPRESENTATIVE, WE ARE INCLINED TO RESTORE BOTH THE ISSUES DISPUTED BEFORE US TO THE FILE OF THE ASSESSING OFFICER FOR DE NOVO ADJUDICATION AFTER DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE MUST OBSERVE , IT IS THE DUTY OF THE ASSESSEE TO JUSTIFY ITS CLAIM THROUGH PROPER DOCUMENTARY EVIDENCE S . WE ALSO MAKE IT CLEAR , WE HAVE EXPRESSED NO OPINION WITH REGARD TO THE MERITS OF THE ISSUE S RAISED IN THE PRESENT APPEAL. GROUNDS RAISED ARE ALLOWED FOR STATISTICAL PURPOSES. 5 KISHOR DEOMAL GAMBANI 8 . IN THE RESULT, APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 13.03.2019 SD/ - MANOJ KUMAR AGGARWAL ACCOUNTANT MEMBER SD/ - SAKTIJIT DEY JUDICIAL MEMBER MUMBAI, DATED: 13.03.2019 COPY OF THE ORDER FORWARDED TO : ( 1 ) THE ASSESSEE; ( 2 ) THE REVENUE; ( 3 ) THE CIT(A); ( 4 ) THE CIT, MUMBAI CITY CONCERNED; ( 5 ) THE DR, ITAT, MUMBAI; ( 6 ) GUARD FILE . TRUE COPY BY ORDER PRADEEP J. CHOWDHURY SR. PRIVATE SECRETARY (SR. PRIVATE SECRETARY) ITAT, MUMBAI