ITO 24(1), MUMBAI V. SHAMA CONSTRUCTIONS, MUMBAI

ITA 8326/MUM/2010

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1658 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 1 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-01-2013
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2006-2007
• Appeal Filed On: 01-12-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: DEEPAK KUMAR SINHA
• Keywords: Business income; Opportunity of being heard; Additional evidence
• Section: 143(3); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH E, MUMBAI BEFORE SHRI D.K. AGARWAL, JUDICIAL MEMBER AND SHRI D. KARUNAKARA RAO, ACCOUNTAT MEMBER I.T.A. NO.8326/M/2010 ASSESSMENT YEAR: 2006-2007 ACIT-24(1), C-13, ROOM NO. 503, PRATYAKSH KAR BHAVAN, BANDRA KURLA COMPLEX, BANDRA (E), MUMBAI-51. VS. M/S. SHAMA CONSTRUCTIONS, 12/6, VALCHAND APARTMENTS, OSHIWARA, JOGESHWARI (W), MUMBAI 400 102. PAN: AABFS6499Q (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI DEEPAK KUMAR SINHA, DR RESPONDENT BY : SHRI K. GOPAL DATE OF HEARING: 31.12.12 DATE OF ORD ER: 4.1.2013 O R D E R PER D. KARUNAKARA RAO, AM: THIS APPEAL FILED BY THE REVENUE ON 1.12.2010 IS A GAINST THE ORDER OF CIT (A)- 34, MUMBAI DATED 29.9.2010 FOR THE ASSESSMENT YEAR 2006-2007. 2. IN THIS APPEAL, REVENUE RAISED THE FOLLOWING GROU NDS WHICH READ AS UNDER: 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE AND IN LAW, THE LD CIT (A) ERRED IN DELETING THE ADDITIONS MADE IN THE ASSESSMENT ORDER TO THE TUNE OF RS. 23,46,625/- ON ACCOUNT OF UNEXPLAINED SUNDRY CREDITORS BY IGNORING THE FACTS THAT THE ASSESSEE HAD NOT FIL ED ANY DETAILS BEFORE AO. 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT (A) ERRED IN ADMITTING THE ADDITIONAL EV IDENCES IN CONTRAVENTION OF RULE 46A OF THE I.T. ACT, WITHOUT PROVIDING AN OPPO RTUNITY TO THE AO. 3. WHETHER THE LD CIT (A) IS JUSTIFIED IN HOLDING T HAT THE ADDITION HAS BEEN MADE WITHOUT ANY ENQUIRY BY THE AO KNOWING FUL LY WELL THAT THE ASSESSEE HAD NOT FILED DETAILS OF SUNDRY CREDITORS AT ALL IN SPITE OF REPEATED OPPORTUNITIES GIVEN TO THE ASSESSEE AND IN THE CIRC UMSTANCES, THE AO WAS NOT IN A POSITION TO MAKE ANY ENQUIRY. 4. THE APPELLANT PRAYS THAT THE ORDER OF CIT (A) ON THE ABOVE GROUNDS BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE R ESTORED. 3. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT TH E ASSESSEE IS A CIVIL CONTRACTOR, FILED ITS RETURN DECLARING LOSS OF RS. 9,13,197/-. THE SAME WAS PROCESSED U/S 143(3) OF THE IT ACT. AFTER MAKING SOME DISALLOWANCES AO DETERMINED THE BUSINESS INCOME OF THE ASSESSEE AT RS. 14,43,450/-. ACCORDING TO AO , DURING THE COURSE OF 2 ASSESSMENT PROCEEDINGS, ASSESSEE COULD NOT SUBSTANT IATE THE GENUINENESS OF THE CREDIT ENTRIES AND OUTSTANDING BALANCES OF ITS TWO PARTNERS (OUT OF THREE PARTNERS) NAMELY M/S. PARIKH SALES CORPORATION, M/S. PARIKH E NTERPRISES AMOUNTING TO RS.23,46,625/-. AGGRIEVED WITH THE DECISION OF THE AO, ASSESSEE WENT ON APPEAL BEFORE THE FIRST APPELLATE AUTHORITY. 4. DURING THE COURSE OF PROCEEDINGS, CIT (A) ALLOWE D THE APPEAL OF THE ASSESSEE AND DELETED THE ADDITION MADE BY THE AO U/S 68 OF THE ACT AND ASSESSEE GOT RELIEF OF RS. 23,46,625/-. AGGRIEVED, REVENUE FILED AN AP PEAL BEFORE THE TRIBUNAL. 5. BEFORE US, LD DR ARGUED THAT WHILE PROCEEDINGS B EFORE THE FIRST APPELLATE AUTHORITY, CIT (A) ERRED IN ADMITTING THE ADDITIONAL EVIDENCES IN CONTRAVENTION OF RULE 46A OF THE INCOME TAX ACT, 1961 WITHOUT PROVID ING AN OPPORTUNITY TO THE AO AND PRAYED THE BENCH TO SEND BACK THE ISSUE TO THE FILES OF THE AO FOR FRESH ADJUDICATION. 6. ON THE OTHER HAND, SHRI K. GOPAL, LD COUNSEL FOR THE ASSESSEE HAS FAIRLY CONSENTED AND SHOWED NO OBJECTION TO THE PRAYER OF LD DR TO REMIT THE MATTER TO THE FILE OF AO. 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE BEFORE US. BOTH THE PARTIES AGREED FOR SETING ASIDE THE FINDIN G OF THE CIT(A) AND REMIT THE SAME TO THE FILES OF THE AO FOR FRESH ADJUDICATION. THE REFORE, WE ARE OF THE CONSIDERED OPINION THAT THE ISSUE NEEDS TO BE REMITTED TO THE FILES OF THE AO FOR FRESH ADJUDICATION OF THE ISSUE RASIED IN THE GROUND AFTE R AFFORDING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. ACCORDINGLY, GROUNDS RAISED BY THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES. 8. IN THE RESULT, THE APPEAL OF THE REVENUE IS ALLOW ED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 4 TH DAY OF JANUARY, 2013. SD/- SD/- (D.K. AGARWAL) (D. KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE : 4.1.2013 3 AT :MUMBAI OKK COPY TO : 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (A), CONCERNED. 4. THE CIT CONCERNED. 5. THE DR E, BENCH, ITAT, MUMBAI. 6. GUARD FILE. // TRUE COPY// BY ORDER ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI