MR. SANTOKUMAR GOGRAJ ADUKIA, MUMBAI V. PR. CIT-17, MUMBAI

ITA 990/MUM/2021

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 8670 (ITAT-MUMBAI)
• Duration Of Justice: 8 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-02-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: misc
• Appeal Filed On: 30-05-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Revision of order; Principle of natural justice
• Section: 147; 263; 69C; 143(3); 69A; 139(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, MUMBAI BEFORE SHRI PRAMOD KUMAR, VP AND SHRI AMARJIT SINGH, JM आयकर अपील सं/ I.T.A. No. 990/Mum/2021 (निर्धारण वर्ा / Assessment Year: 2012-13) Mr. Santosh Kumar Gograj Adukia B-401 Twin Apartment, Marve Road, Opp. Marve NSG. Home,Malad- Mumbai-400064. बिधम/ Vs. PCIT-17 Room No.120, 1 st Floor, Kautilya Bhavan, C-41 to C- 43, G Block, Bandra Kurla Complex, Bandra (E), Mumbai-400051 स्थायी लेखा सं./जीआइआर सं./PAN/GIR No. : AAAPA7459F (अपीलाथी /Appellant) .. (प्रत्यथी / Respondent) सुनवाई की तारीख / Date of Hearing: 15/12/2021 घोषणा की तारीख /Date of Pronouncement: 18/02/2022 आदेश / O R D E R PER AMARJIT SINGH, JM: The assessee has filed the present appeal against the order dated 27.03.2021 passed by the Principal Commissioner of Income Tax - 17 Mumbai [hereinafter referred to as the “PCIT)”] relevant to the A.Y.2012- 13 in which the Principal Commissioner of Income Tax-17 has invoked the provisions u/s 263 of the I.T. Act, 1961. 2. The assessee has raised the following grounds: - “1. On the facts and circumstances of the case and in law, the Ld. Pr. C.I.T, Mumbai-17, has grossly erred in passing an order u/s 263 of the I.T ACT, without providing an opportunity of personal hearing, which is against the principles of natural justice and is bad in law. Assessee by: Shri Shailesh Bandi Revenue by: Shri A. K. Kardam (DR) ITA. No.990/Mum/2021 A.Y. 2012-13 2 2. On the facts and circumstances of the case and in law the order passed by the Ld. Pr.C.I.T, Mumbai 17, u/s 263 dated 27/03/2021 is without Jurisdiction, bad in law & Void –ab-initio. 3. On the facts and circumstances of the case and in law, the Ld. Pr .C.I.T, Mumbai 17, has grossly erred in concluding that an order passed U/S 147 R.W.S 143 (3) is erroneous and prejudicial to the interest of revenue. 4. On the facts and circumstances of the case and in law, the Ld. Pr. C.1.T has failed to point out any error& reason causing prejudicial interest of the Revenue in the order of the Assessing Officer, which is sine qua non for initiation of proceedings u/s 263 of the Act. 5. The appellant craves leave to add, alter or amend or vary any of the above grounds of appeal before or at the time of hearing.” 3. The brief facts of the case are that the assessee filed his return of income u/s 139(1) of the Act declaring total income to the tune of Rs.5,14,150/- for the A.Y.2012-13. The AO reopened the assessment u/s 143(3) r.w.s. 147 of the Act and completed the assessment order assessing the income to the tune of Rs.10,39,150/- by making the addition of Rs.5,25,000/- on account of unexplained Bogus Loan u/s 69A & and Commission paid for bogus entry u/s 69C dated 17.12.2019. Thereafter, it was observed that an information was received from the DDIT, Unit-7(4), Mumbai in which it was submitted that the assessee had traded in penny stock of M/s. Sampada Chemicals Ltd. and the assessee was one of the beneficiaries of the penny stock transaction. The said transaction was disclosed with M/s. Sampada Chemicals Ltd was controlled and operated ITA. No.990/Mum/2021 A.Y. 2012-13 3 by Vipul Vidhur Bhatt. The said transaction was not considered by the AO, therefore, the notice was given and after the reply of the assessee, the PCIT has invoked the power u/s 263 of the Act. 4. We have heard the argument advanced by the Ld. Representative of the parties and perused the record. The Ld. PCIT has invoked the power u/s 263 of the Act on the basis of this fact that an information was received from the DGIT(Inv.), Mumbai to the fact that the assessee has traded in penny stock transaction. The said M/s. Sampada Chemicals Ltd., was controlled and operated by Vipul Vidhur Bhatt whose statement was recorded. Vipul Vidhur Bhatt was providing the entry of bogus LTCG to various clients. The AO failed to enquiry about the transaction of M/s. Sampada Chemicals Ltd. No addition was made. Since no enquiry and verification was done by AO, therefore, the notice u/s 263 was issued. Firstly, we find that the no transaction was ever mentioned by the DDIT, Unit-7(4), Mumbai specifically in the relevant A.Y.2012-13. The assessee‟s contention is that the transaction with M/s. Sampada Chemicals Ltd. has already been examined in the A.Y.2011-12. The assessee claimed the „Long Term Capital Gain‟ (LTCG) of Rs.12,73,188/- derived in the scrip named M/s. Sampada Chemicals Ltd. pertaining to the A.Y.2011-12. Considering the said transaction, the assessment for the A.Y.2011-12 was reopened u/s 148 of the Act and the said amount has already been taxed in the A.Y.2011- 12. The assessment order u/s 143(3) r.w.s. 147 of the Act has been passed by virtue of order dated 30.11.2018. The assessee also avail the scheme of Vivad Se Vishwas Scheme (VSVS) and received the certificate in Form no. 3 and Form no. 4. The said forms have been submitted before the AO as well as PCIT in the relevant assessment year. No transaction with M/s. ITA. No.990/Mum/2021 A.Y. 2012-13 4 Sampada Chemicals Ltd was done in the assessment year under consideration. Nothing came into notice that the order is erroneous in so far as the prejudicial to the interest of the revenue. In the relevant assessment year no Long Term Capital Gain was claimed. Short Term Capital Gain (STCG) was claimed to the tune of Rs.27,897/- and taxed. After reducing the DMAT charges, the said transaction has already been disclosed with. Since the no transaction has been disclosed and the transaction with M/s. Sampada Chemicals Ltd. has already been assessed in the earlier year, therefore, we nowhere found this ground to revise the order in the interest of justice. Further, we noticed that the PCIT issued the notice of hearing to the appellant on 15.03.2021 affixing the date on 18.03.2021 which is very short and nowhere provide justifiable time to explain things. It also seems against the principle of natural justice. Taking into account of all the facts and circumstances, we are of the view that the revisional power invoked the PCIT under section 263 is not justifiable, therefore, we set aside the order and allowed the appeal of the assessee. 5. In the result, the appeal filed by the assessee is hereby allowed. Order pronounced in the open court on 18/02/2022 Sd/- Sd/- (PRAMOD KUMAR) (AMARJIT SINGH) उपधध्यक्ष / VICE PRESIDENT न्यधनिक सदस्य/JUDICIAL MEMBER मुंबई Mumbai; ददनांक Dated : 18/02/2022 Vijay Pal Singh, (Sr. PS) ITA. No.990/Mum/2021 A.Y. 2012-13 5 आदेश की प्रनिनिनप अग्रेनर्ि/Copy of the Order forwarded to : 1. अपीलाथी / The Appellant 2. प्रत्यथी / The Respondent. 3. आयकर आयुक्त(अपील) / The CIT(A)- 4. आयकर आयुक्त / CIT 5. दवभागीय प्रदतदनदध, आयकर अपीलीय अदधकरण, मुंबई / DR, ITAT, Mumbai 6. गार्ड फाईल / Guard file. आदेशधिुसधर/ BY ORDER, सत्यादपत प्रदत //True Copy// उप/सहधिक पंजीकधर /(Dy./Asstt. Registrar) आिकर अपीिीि अनर्करण, मुंबई / ITAT, Mumbai