SITU SHASTRI, MUMBAI V. ACIT 20(3), MUMBAI

ITA 8065/MUM/2010

• Counselvise Citation: 806519914 RSA 2010
• Duration Of Justice: 3 year(s) 5 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-05-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 05-05-2014
• Assessment Year: 2001-2002
• Appeal Filed On: 23-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PITAMBAR DAS
• Keywords: Unexplained cash credit
• Section: 143(3); 68

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUMBAI BEFORE S/SHRI P.M.JAGTAP (AM) AND DR. S. T. M.PAVALAN (JM) ./I.T.A.NO.8065/MUM/2010 ( / ASSESSMENT YEAR: 2001-02) SITU SHASTR I, 1 ST FLOOR, SILVER LINE, S B MARG, J B NAGAR, ANDHERI (E), MUMBAI-400059, MAHARASHTRA. / VS. ASSTT. COMMISSIONER OF INCOME TAX, 20(3) C-10, 7TH FLOOR, PRATYAKSHAKAR BHAVAN, BANDRA-KURLA COMPLEX, BANDRA (E), MUMBAI-400051. ( / APPELLANT) ( / RESPONDENT) ./ ./PAN/GIR NO. : AAEPS6130M / APPELLANT BY : SHRI MADHUR AGARWAL /RESPONDENT BY SHRI PITAMBAR DAS # / DATE OF HEARING : 8.5.2014 # /DATE OF PRONOUNCEMENT : 21.5.2014 / O R D E R PER P.M.JAGTAP,AM: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF LD. CIT(A)-31, MUMBAI DATED 27.8.2010 WHEREBY HE CONFIRMED THE PEN ALTY OF RS.33,02,910/- IMPOSED BY THE AO U/S 271 (1)( C) OF THE INCOME TAX ACT, 19 61 (THE ACT). 2. THE ASSESSEE IN THE PRESENT CASE IS AN INDIVIDU AL WHO FILED HIS RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION ON 31.10.2001 DECL ARING TOTAL INCOME AT RS.12,11,248/-. IN THE ASSESSMENT COMPUTED U/S 14 3(3) OF THE ACT, THE TOTAL INCOME OF THE ASSESSEE WAS COMPUTED BY AO AT RS.3,24,62,340/- AFTER MAKING VARIOUS ADDITIONS ITA 8065/MUM/2010 2 INCLUDING THE MAJOR ADDITIONS OF RS.2,51,90,000/- MADE UNDER SECTION 68 OF THE ACT ON ACCOUNT OF UNEXPLAINED CASH CREDITS. ON APPEAL, THE LD. CIT(A) SUSTAINED THE ADDITION MADE BY AO U/S 68 TO THE EXTENT OF RS.94,10,000/-. THEREAFTER, A SHOW CAUSE NOTICE WAS ISSUED BY THE AO TO THE ASSESSEE CALLING UPON HIM TO EXPLAIN AS TO WHY THE PENALTY U/S 271(1)(C) OF THE ACT SHOULD NOT BE IMPOSED IN RESPECT OF ADDITION MADE U/S 68 OF THE ACT AS SUSTAINED BY THE LD. CIT(A) TO THE EXT ENT OF RS.94,10,000/-. THE EXPLANATION OFFERED BY THE ASSESSEE IN RESPONSE T O THE SHOW CAUSE NOTICE WAS NOT FOUND ACCEPTABLE BY THE AO AND HE PROCEEDED TO IMPO SE A PENALTY OF RS.33,02,910/- U/S 271 (1)( C ) BEING 100% OF THE TAX SOUGHT TO BE EVADED BY THE ASSESSEE IN RESPECT OF ADDITION OF RS.94,10,000/- MADE U/S 68 OF THE ACT. ON APPEAL, THE LD. CIT(A) CONFIRMED THE SAID PENALTY IMPOSED BY THE AO U/S 2 71(1)( C ) OF THE ACT. AGGRIEVED BY THE ORDER OF LD. CIT(A), THE ASSESSEE HAS PREFERRE D THIS APPEAL BEFORE THE TRIBUNAL. 3. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. AS SUBMITTED BY THE LD. COUN SEL FOR THE ASSESSEE, THE ISSUE RELATING TO ADDITION OF RS.94,10,000/- AS SUSTAINED BY THE L D. CIT(A) WAS RAISED BY THE ASSESSEE IN AN APPEAL FILED BEFORE THE TRIBUNAL AND THE TRI BUNAL VIDE ITS ORDER DATED 6.7.2011 PASSED IN ITA NO.3387/MUM/2006 HAS RESTORED THE S AME TO THE FILE OF THE AO FOR DECIDING IT AFRESH. THE LD. COUNSEL OF THE AS SESSEE HAS FURTHER SUBMITTED THAT THE AO HAS ALREADY PASSED AN ORDER AS PER THE DIRECTI ONS OF THE TRIBUNAL AND HAS DECIDED THE ISSUE RELATING TO ADDITION U/S 68 OF THE ACT B Y HIS ORDER DATED 28.3.2013 PASSED U/S 143(3) READ WITH SECTION 254 OF THE ACT ACCEPTING THE EXPLANATION OF THE ASSESSEE IN RESPECT OF CASH CREDITS TO THE EXTENT OF RS.14 LAK HS AND MAKING THE ADDITION U/S 68 ON ACCOUNT OF BALANCE CASH CREDIT OF RS.80,10,000/-. A COPY OF THE SAID ORDER IS ALSO PLACED ON RECORD BEFORE US BY THE LD. COUNSEL FOR THE ASSESSEE WHICH CLEARLY SHOWS THAT THE PENALTY PROCEEDINGS U/S 271(1)( C ) R.W.SECTION 274 HAVE BEEN REINITIATED BY THE AO IN RESPECT OF THE ADDITION OF RS.80,10,000/- MADE U/S 68 OF THE ACT IN THE FRESH ITA 8065/MUM/2010 3 ASSESSMENT MADE AS PER THE DIRECTION OF THE TRIBUNA L. AS RIGHTLY CONTENDED BY THE LD. COUNSEL FOR THE ASSESSEE AND EVEN AGREED BY THE L D. DR, THE BASIS OF IMPUGNED PENALTY IMPOSED BY THE AO IN RESPECT OF ADDITION OF RS.94,10,000/-, THUS NO MORE SURVIVES AS A RESULT OF FURTHER DEVELOPMENT TAKEN P LACE IN THE QUANTUM PROCEEDINGS AND THE PENALTY SO IMPOSED BY THE AO AND CONFIRMED BY L D. CIT(A) IS LIABLE TO BE CANCELLED HAVING NO LEGS TO STAND. WE ORDER ACCORDINGLY AND ALLOW THIS APPEAL OF THE ASSESSEE. 4. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 21 ST MAY, 2014 ( * + MAY, 2014 SD SD ( DR. S. T. M.PAVALAN) (P .M.JAGTAP) ( / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI: ON THIS 21ST DAY OF MAY, 2014 . . ./ SRL , SR. PS ! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT /APPLICANT 2. / THE RESPONDENT. 3. 0 ( ) / THE CIT(A)- 4. 0 / CIT 5. 1 3 , # 3 , / DR, ITAT, MUMBAI 6. / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) # 3 , /ITAT, MUMBAI