SHRI. VINOD KUMAR U AGRAWAL, Mumbai V. ITO WARD 17(3)(5), Mumbai

ITA 829/MUM/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 3582 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-03-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 14-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAURABH DESH
• Keywords: Unexplained expenditure; Opportunity of being heard; Accommodation entries; Set aside
• Section: 69C; 133A; 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY , JUDICIAL MEMBER AND SHR I G. MANJUNATH A , ACCOUNTANT MEMBER ITA NO. 829 / MUM . /201 9 ( ASSESSMENT YEAR : 20 13 14 ) SHRI VINOD KUMAR U. AGRAWAL 1 ST FLOOR, BANU MANSIN 16, NADIRSHAW SHUKHIA STREET FORT, MUMBAI 400 020 PAN ADRPA7903L . APPELLANT V/S INCOME TAX OFFICER WARD 17(3)(5), MUMBAI . RESPONDENT ASSESSEE BY : NONE REVENUE BY : S HRI SAURABH DESHPANDE DATE OF HEARING 05 .0 2 .2020 DATE OF ORDER 04.03.2020 O R D E R PER SAKTIJIT DEY. J.M. THE CAPTIONED APPEAL HAS BEEN FILED BY THE ASSESSEE CHALLENGING THE ORDER DATED 13 TH NOVEMBER 2018 , PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) 28 , MUMBAI, PERTAINING TO THE ASSESSMENT YEAR 20 13 14 . 2. WHEN THE APPEAL WAS CALLED FOR HEARING, NO ONE WAS PRESENT ON BEHALF OF THE ASSESSEE TO REPRESENT THE CASE. THERE IS NO APPLICATION 2 SHRI VINOD KUMAR U. AGRAWAL SEEKING ADJOURNMENT EITHER . ACCORDINGLY, WE PROCEED TO DISPOSE OFF THE APPEAL EX PARTE QUA THE ASSESSEE AFTER HEARING THE LEARNED DEPARTMENTAL REPRESENTATIVE AND ON THE BASIS OF MATERIAL AVAILABLE ON RECORD. 3. THE DISPUTE IN THE PRESENT APPEAL IS CONFINED TO THE ADDITION MADE OF ` 21 ,50,000, AS UNEXPLAINED EXPENDITURE UNDER SECTION 69C OF THE INCOME TAX ACT, 1961 (FOR SHORT 'THE ACT' ). 4. BRIEF FACTS ARE, THE ASSESSEE IS AN INDIVIDUAL AND IS ENGAGED IN THE BUSINESS OF TRADING IN TEXTILE. FOR THE ASSESSMENT YEAR UNDER DISPUTE, THE ASSESSEE FILED HIS RETURN OF INCOME ON 4 TH MARCH 2014, DECLARING TOTAL INCOME OF ` 8,56,540. IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTICED THAT AS PER THE INFORMATION RECEIVED FROM THE DGIT (INV.), SURAT, IN THE COURSE OF A SURVEY OPERATION CONDUCTED UNDER SECTION 133A OF THE ACT, IN CASE OF ONE SHRI HARI M. P H ERWANI , ON 10 TH APRIL 2013, IT WAS FOUND THAT THE ASSESSEE HAS TRANSFERRED FUND THROUGH RTGS AGGREGATING TO ` 21,52,100, TO TWO PROPRIETARY CONCERN S OF SHRI HARI M. PHERWANI , AND HAS IMMEDIATELY RECEIVED BACK THE CASH ON CLEARANCE OF THE CHEQUES. WHEN CONFRONTED WITH THE AFORESAID INFORMATION, THE ASSESSEE SUBMITTED THAT THE PAYMENT MADE WAS FOR PURCHASE OF GOODS. ON THE BASIS OF SUBMISSIONS MADE BY THE ASSESSEE, THE ASSESSING OFFICER CALLED UPON THE ASSESSEE 3 SHRI VINOD KUMAR U. AGRAWAL TO FURNISH THE DETAILS OF PURCHASES SUCH AS PURCHASE BILLS, PAYMENT DETAILS, VEHICLE DETAILS, LORRY RECEIPT, GATE PASS, COST INWARD AND OUTWARD NOTE, COST MOVEMENT REGIST ER, BANK STATEMENT, ETC. N OT BEING SATISFIED WITH THE EVIDENCES FILED BY THE ASSESSEE AND RELYING UPON THE INFORMATION AVAILABLE ON RECORD INCLUDING THE STATEMENT RECORDED FROM HARI M. PHERWANI , THE ASSESSING OFFICER ULTIMATELY CONCLUDED THAT THE CLAIM OF THE ASSESSEE THAT PAYMENT MADE WAS TOWARD S PURCHASES IS UNBELIEVABLE AND ASSESSEE HAS OBTAINED ACCOMMODATION ENTRIES. ACCORDINGLY, TREATING THE PURCHASES OF ` 21,50,000, AS BOGUS, THE ASSESSING OFFICER ADDED BACK TO THE INCOME OF THE ASSESSEE AS UNEXPLAINED EXPENDITURE UNDER SECTION 69C OF THE ACT. THOUGH , T HE ASSESSEE CONTESTED THE AFORESAID ADDITION BEFOR E LEARNED COMMISSIONER (APPEALS), HOWEVER, HE WAS UNSUCCESSFUL, AS THE ADDITION MADE WAS SUSTAINED. 5. WE HAVE C ONSIDERED THE SUBMISSIONS OF LEARNED DEPARTMENTAL REPRESENTATIVE AND PERUSED THE MATERIAL ON RECORD. AS COULD BE SEEN FROM THE IMPUGNED OR DER OF LEARNED COMMISSIONER (APPEALS), SINCE THE ASSESSEE FAILED TO APPEAR BEFORE THE FIRST APPE LLATE AUTHORITY TO REPRESENT HIS CASE ON VARIOUS D ATES FIXED FOR HEARING OF APPEAL, HE PROCEEDED TO DISPOSE OFF THE APPEAL EX PARTE BY SUSTAINING THE ADDITION MADE BY THE ASSESS ING OFFICER. WHILE DOING SO, LEARNED COMMISSIONER (APPEALS) HAS OBSERVED THAT THE ASSESSEE FAILED TO LEAD 4 SHRI VINOD KUMAR U. AGRAWAL ANY EVIDENCE TO PROVE T HE GENUINENESS OF PURCHASES, HENCE, THE ADDITION HAS TO BE SUSTAINED. IT IS FURTHER NOTICED , THOUGH , IN P ARA 2.1 OF THE APPEAL ORDER, LEARNED COMMISSIONER (APPEALS) HAS REFERRED TO FOUR OCCASIONS ON WHICH THE APPEAL WAS FIXED FOR HEARING, HOW EVER, IT IS N OT FORTHCOMING WHETHER ANY NOTICE OF HEARING WAS ISSUED TO THE ASSESSEE AND , IF ISSUED , WHETHER THEY WERE SERVED ON THE ASSESSE E. CONSIDERING THE FACT THAT LEARNED COMMISSIONER (APPEALS) HAS SUSTAINED THE ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT O F NON GENUINE PURCHASES DUE TO LACK OF REPRESENTATION BY THE ASSESSEE AND IN THE ABSENCE OF ANY CORROBORATIVE EVIDENCE FILED BY HIM TO PROVE THE PURCHASES, WE ARE INCLINED TO GRANT ONE MORE OPPORTUNITY TO THE ASSESSEE TO PROVE HIS CASE BEFORE LEARNED COMMI SSIONER (APPEALS). FOR ENABLING THE ASSESSEE TO DO SO, WE SET ASIDE THE IMPUGNED ORDER OF LEARNED COMMISSIONER (APPEALS) AND RESTORE THE ISSUE BACK TO HIS FILE FOR FRESH ADJUDICATION AFTER DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. FURTHER, WE MAKE IT CLEAR , THE ASSESSEE SHOULD ACT IN A DILIGENT MANNER IN REPRESENTING HIS CASE BEFORE LEARNED COMMISSIONER (APPEALS) AND CO OPERATE IN FINALIZING THE PROCEEDING . WITH THE AFORESAID OBSERVATIONS, THE GROUNDS ARE ALLOWED FOR STATISTICAL PURPOSES. 5 SHRI VINOD KUMAR U. AGRAWAL 6. IN THE R ESULT, APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN C OURT ON 04.03.2020 SD/ - G. MANJUNATH A ACCOUNTANT MEMBER SD/ - SAKTIJIT DEY JUDICIAL MEMBER MUMB AI, DATED: 04.03.2020 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 ASSISTANT REGISTRAR ITAT, MUMBAI