MANIBEN CHHADWA, MUMBAI V. ACIT CEN CIR 8, MUMBAI

ITA 8574/MUM/2010

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9294 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 3 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-03-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 12-01-2015
• Assessment Year: 2003-2004
• Appeal Filed On: 09-12-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S J SINGH
• Keywords: Gift; Search and seizure
• Section: 153A; 14A; 68; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUM BAI . . , , BEFORE SHRI B. R. BASKARAN, AM AND SHRI SANJAY GAR G, JM ./ I.T.A. NO. 8574/MUM/2010 ( / ASSESSMENT YEAR: 2003-04) MRS. MANIBEN CHHADWA 602/B, 3 RD FLOOR, CAPTAIN HOUSE, DR. AMBEDKAR ROAD, MATUNGA (CR), MUMBAI-400 019 / VS. ASST. CIT, CENTRAL CIRCLE-8, MUMBAI ./! ./PAN/GIR NO. AACPC 9095 K ( ' /APPELLANT ) : ( #$ ' / RESPONDENT ) ' % & / APPELLANT BY : SHRI VIJAY MEHTA #$ ' % & / RESPONDENT BY : SHRI S. J. SINGH ' () % *+ / DATE OF HEARING : 13.01.2015 ,-./ % *+ / DATE OF PRONOUNCEMENT : 11.03.2015 0 / O R D E R PER SANJAY GARG, JUDICIAL MEMBER : THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSESS EE AGAINST THE ORDER OF THE LD. CIT(A) DATED 14.09.2010. THE ASSESSEE INTER ALIA HAS CONTESTED THE VALIDITY OF THE ADDITIONS MADE BY THE ASSESSING OFFICER (A.O.) PURS UANT TO THE ASSESSMENT U/S.143(3) R/W S. 153A OF THE INCOME TAX ACT, 1961 (THE ACT HERE INAFTER). 2. THE FACTS IN BRIEF ARE THAT A SEARCH AND SEIZURE ACTION U/S. 132(1) OF THE ACT WAS CARRIED OUT IN THE GROUP CASES OF M/S. SEA LIFESTYL ES PVT. LTD. INCLUDING RESIDENTIAL 2 ITA NO. 8574/MUM/2010 (A.Y. 2003-04) MRS. MANIBEN CHHADWA VS. ASST. CIT PREMISES OF THE ASSESSEE ON 11.04.2007. NOTICE U/S. 153A WAS ISSUED AND SERVED UPON THE ASSESSEE AND THEREAFTER THE REASSESSMENT WAS DONE U /S.143(3) R/W S. 153A OF THE ACT. THE A.O. ADDED A SUM OF RS.13,08,326/- BEING GIFT RECEI VED BY THE ASSESSEE BY WAY OF SBI RESURGENT INDIA BONDS WORTH US # 20,000/- FROM ONE MR. MINESH SHAH. THE ASSESSEE HAD CONTENDED BEFORE THE LD. CIT(A) THAT THE ABOVE SAID ADDITION WAS NOT BASED UPON ANY INCRIMINATING MATERIAL FOUND DURING THE COURSE OF S EARCH AND THAT THE REASSESSMENT OF ALREADY CONCLUDED ASSESSMENT IN THE ABSENCE OF ANY INCRIMINATING MATERIAL COULD NOT BE DONE UNDER LAW. HOWEVER, THE SAID CONTENTION OF THE ASSESSEE WAS REJECTED. THE A.O. HELD THAT THE ASSESSEE COULD NOT PROVE WITH COGENT AND C ONVINCING EVIDENCE, THE RECEIPT OF THE SAID AMOUNT OF RS.13,08,326/- AND MADE THE ADDITION U/S.68 OF THE ACT. THE LD. CIT(A) ALSO CONFIRMED THE ADDITION SO MADE BY THE A.O. THE ASSESSEE HAS THUS CAME IN APPEAL BEFORE US. 3. AT THE OUTSET, THE LD. AR OF THE ASSESSEE HAS SU BMITTED THAT NO INCRIMINATING MATERIAL WAS FOUND DURING THE SEARCH ACTION, HENCE THE REASSESSMENT IN THIS CASE OF THE ALREADY CONCLUDED ASSESSMENT WAS NOT VALID. HE HAS ALSO RELIED UPON THE DECISION OF THE TRIBUNAL IN THE CASE OF FAMILY MEMBER OF THE ASSESS EE, NAMELY MRS. RAKESHA CHADDWA, WHEREIN THE ADDITIONS WERE MADE ON IDENTICAL FACTS AND PURSUANT TO THE SAME SEARCH ACTION AND ALSO IN RESPECT OF THE GIFT OF SBI RESURGENT IN DIA BONDS, VALUING AT RS.6,54,138/-. HE HAS CONTENDED THAT THE TRIBUNAL IN THE CASE OF FAMI LY MEMBER OF THE ASSESSEE, ON IDENTICAL FACTS AND IN RELATION TO THE SAME SEARCH ACTION HAS DELETED THE ADDITION ON THE GROUND THAT NO INCRIMINATING MATERIAL WAS FOUND AGAINST THE ASS ESSEE DURING THE SEARCH ACTION. 4. WE HAVE GONE THROUGH THE DECISION OF THE TRIBUNA L PASSED IN ITA NOS. 8576 AND 8577/MUM/2010 ORDER DATED 17.10.2014. THE TRIBUNAL ON THE IDENTICAL FACTS HAS DELETED THE ADDITION IN THE CASE OF FAMILY MEMBER OF THE AS SESSEE MRS. RAKESHA CHADDWA, OBSERVING AS UNDER: 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND CAREFU LLY PERUSED THE RECORD. THERE IS NO DISPUTE WITH REGARD TO THE FACT THAT BOTH THE ASSESSMENT YEARS UNDER CONSIDERATION FALL IN THE CATEGORY OF 'CONCLUDED AS SESSMENTS'. IN THE VARIOUS CASE 3 ITA NO. 8574/MUM/2010 (A.Y. 2003-04) MRS. MANIBEN CHHADWA VS. ASST. CIT LAW RELIED UPON BY THE ID. AR OF THE ASSESSEE, IT H AS BEEN HELD THAT THE AO WOULD BE ENTITLED TO MAKE ANY ADDITION IN THE CASE OF CON CLUDED ASSESSMENTS ONLY ON THE BASIS OF INCRIMINATING MATERIALS FOUND DURING THE C OURSE OF SEARCH, SINCE THE CONCLUDED ASSESSMENTS DO NOT ABATE BY VIRTUE OF SEC TION 153A OF THE ACT. THE SAID VIEW IS ALSO SUPPORTED BY THE DECISION OF MUMBAI SP ECIAL BENCH OF IT AT RENDERED IN THE CASE OF ALL CARGO GLOBAL LOGISTICS LTD (ITA NO.5108 TO 5022/MUM/2010 DATED 06-07-2012). FURTHER, IN THE CA SE OF SHRI GOVIND AGARWAL (SUPRA) RELIED UPON BY THE ASSESSEE, WE NOTICE THAT THE TRIBUNAL HAS PLACED RELIANCE ON THE DECISION RENDERED BY THE HON'BLE RAJASTHAN H IGH COURT IN THE CASE OF JAI STEEL (INDIA), JODHPUR VIS ACIT [2013] 36 TAXMANN.C OM 523, WHEREIN THE HON'BLE RAJASTHAN HIGH COURT HAS HELD THAT 'IN CASE, NOTHIN G INCRIMINATING IS FOUND ON ACCOUNT OF SUCH SEARCH OR REQUISITION, THEN THE QUE STION OF REASSESSMENT OF THE CONCLUDED ASSESSMENTS DOES NOT ARISE, WHICH WOULD R EQUIRE MORE REITERATION AND IT IS ONLY IN THE CONTEXT OF THE ABATED ASSESSMENT UND ER SECOND PROVISO WHICH IS REQUIRED TO BE ASSESSED'. FOR THE SAKE OF CONVENIEN CE, WE EXTRACT BELOW THE RELEVANT OBSERVATIONS MADE BY THE CO- ORDINATE BENC H OF THE TRIBUNAL IN THE CASE OF SHRI GOVIND AGARWAL (SUPRA): '17. RAJASTHAN HIGH COURT JUDGMENT IN THE CASE OF J AI STEEL (INDIA) (SUPRA), VIDE PARA 18, IT IS CATEGORICALLY MENTIONED THAT 'T HE REQUIREMENT OF ASSESSMENT OR REASSESSMENT UNDER THE SAID SECTION ( 153A) HAS TO BE READ IN THE CONTEXT OF SECTIONS 132 OR 132A OF THE ACT, INA SMUCH AS, IN CASE NOTHING INCRIMINATING IS FOUND ON ACCOUNT OF SEARCH OR REQUISITION, THEN THE QUESTION OF REASSESSMENT OF THE CONCLUDED ASSESSMEN TS DOES NOT ARISE, WHICH WOULD MORE REITERATION ..'. THUS, THE JUDG MENT OF HONBLE HIGH COURT IN THE CASE OF JAI STEEL LTD, SUPRA AND ABOVE DECISIONS OF THE TRIBUNAL ARE CATEGORICAL IN CONCLUDING THAT, IN CAS E OF THE CONCLUDED ASSESSMENTS LIKE THE PRESENT ONE, THE ADDITIONS ARE MADE ONLY BASED ON THE INCRIMINATING MATERIAL DISCOVERED DURING THE SEARCH ACTION. HE FACTS OF THE JAI STEEL LTD (SUPRA) ARE IDENTICAL TO THE PRESENT ONE I.E., AO MADE ADDITIONS BY REASSESSING U/S 153A ON THE COMPLETED ASSESSMENT U/S 143(1) OF THE ACT. THUS, CONSIDERING THE JUDGMENT IN THE CASE OF THE J AI STEEL LTD (SUPRA), THE ARGUMENTS ON THE LEGAL ISSUE RAISED BEFORE US STAND S COVERED. THEREFORE, CONSIDERING THE RAJASTHAN HIGH COURT'S JUDGMENT IN THE CASE OF JAI STEELS LTD, SUPRA, WE HAVE NO DIFFICULTY IN (I) UPHOLDING THE ISSUE OF NOTICE U/S 153A OF THE ACT AND (2) IN DISAPPROVING THE MAKING OF THE IMPUGNED ADDITIONS U/S 68 AND 14A OF THE ACT, WHICH ARE NOT BACKED BY THE INCRIMINATING MATERIALS. IN THE ABSENCE OF INCRIMIN ATING MATERIAL, THE ROLE OF THE AO IS ONLY TO REITERATE THE RETURNED INCOME FIL ED IN RESPONSE TO THE NOTICE U/S 153A OF THE ACT. ACCORDINGLY, IN SUBSTAN CE, THE COMMON LEGAL ISSUE RAISED IN THE GROUNDS FOR BOTH THE APPEALS OF THE ASSESSEE (ITA NOS. 3389 & 3390/M/2011) IS ALLOWED' 4 ITA NO. 8574/MUM/2010 (A.Y. 2003-04) MRS. MANIBEN CHHADWA VS. ASST. CIT 6. IN THE INSTANT CASES ALSO, THERE IS NO DISPUTE WITH REGARD TO THE FACT THAT THE ADDITIONS MADE BY THE AO IN ASSESSMENT YEARS 2003-0 4 AND 2005-06 ARE NOT BASED UPON ANY INCRIMINATING MATERIAL FOUND DURING THE CO URSE OF SEARCH. FURTHER, BOTH THE ABOVE SAID ASSESSMENT YEARS FALL IN THE CATEGOR Y OF CONCLUDED ASSESSMENTS. HENCE, BY FOLLOWING THE CONSISTENT VIEW TAKEN BY TH E VARIOUS BENCHES OF TRIBUNAL, WE HOLD THAT THE IMPUGNED ADDITIONS MADE IN BOTH TH E YEARS UNDER CONSIDERATION ARE LIABLE TO BE DELETED. ACCORDINGLY, WE SET ASIDE THE ORDERS PASSED BY THE ID. CIT(A) IN BOTH THE YEARS AND DIRECT THE AO TO DELET E THE IMPUGNED ADDITIONS MADE IN BOTH THE YEARS. 7. IN THE RESULT, THE APPEALS FILED BY THE ASSESSEE ARE ALLOWED. 5. THE FACTS OF THE CASE IN HAND ARE IDENTICAL. ADD ITIONS IN THIS CASE HAVE ALSO BEEN MADE IN RELATION TO GIFT OF SBI RESURGENT INDIA BON DS FOR THE IDENTICAL REASONS. ADMITTEDLY NO INCRIMINATING MATERIAL WAS FOUND DURI NG THE SEARCH ACTION AGAINST THE ASSESSEE. HENCE, THE REASSESSMENT IN THIS CASE IN T HE ABSENCE OF ANY INCRIMINATING MATERIAL LEGALLY COULD NOT HAVE BEEN DONE OF THE AL READY CONCLUDED ASSESSMENT. BEING IN AGREEMENT AND RESPECTFULLY FOLLOWING THE DECISION O F THE TRIBUNAL ON IDENTICAL FACTS IN THE CASE OF FAMILY MEMBER OF THE ASSESSEE, WE DO NOT FI ND ANY JUSTIFICATION IN THE ACTION OF THE LOWER AUTHORITIES IN MAKING THE IMPUGNED ADDITI ONS. THE REASSESSMENT IN THIS CASE IS HELD TO BE INVALID AND THE SAME IS SET ASIDE. THE A DDITIONS SO MADE PURSUANT TO THE REASSESSMENT U/S.153A IN THIS CASE ARE, THEREFORE, ORDERED TO BE DELETED. 6. IN THE RESULT, THE ASSESSEES APPEAL IS HEREBY A LLOWED. 1/*2 31* % ( 4 * % * 56 ORDER PRONOUNCED IN THE OPEN COURT ON MARCH 11, 201 5 SD/- SD/- (B. R. BASKARAN) (SANJAY GARG) / ACCOUNTANT MEMBER / JUDICIAL MEMBER ' ) MUMBAI; 7 DATED : 11.03.2015 (. ../ ROSHANI , SR. PS 5 ITA NO. 8574/MUM/2010 (A.Y. 2003-04) MRS. MANIBEN CHHADWA VS. ASST. CIT ! ' #$%& ' &$ / COPY OF THE ORDER FORWARDED TO : 1. ' / THE APPELLANT 2. #$ ' / THE RESPONDENT 3. ' 8* ( ) / THE CIT(A) 4. ' 8* / CIT - CONCERNED 5. ;( #* <3 , + <3 / , ' ) / DR, ITAT, MUMBAI 6. = >) / GUARD FILE ! ( / BY ORDER, )/(* + (DY./ASSTT. REGISTRAR) , ' ) / ITAT, MUMBAI