Patel Rajeshkumar Maganlal & Co., Surat V. The Dy.CIT, Central Circle-1(2), Ahmedabad

ITSSA 338/AHD/2014

• Counselvise Citation: [2017] 122 COUNSELVISE.COM (IT) 3518 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 3 month(s) 16 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 19-12-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 15-06-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 02-09-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SU RENDRA KUMAR
• Assessee Lawyers: R K JINDAL
• Keywords: Income from undisclosed sources; Corroborative evidences
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH BEFORE: SHR I RAJPAL YADAV , JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER M/S. PATEL RAJESHKUMAR MAGANLAL & CO. 2, POOJA PARK APARTMENT, DHOBI SHERI, HARIPURA, SURAT - 395003 PAN: AAFFP7560F (APPELLANT) VS THE DCIT, CIR.1(2), AHMEDABAD (RESPONDENT) REVENUE BY : S H RI SURENDRA KUMAR , SR. D . R. ASSESSEE BY: S H RI R.K. JINDAL , A.R. DATE OF HEARING : 23 - 11 - 2 017 DATE OF PRONOUNCEMENT : 19 - 12 - 2 017 / ORDER P ER : AMARJIT SINGH, ACCOUNTANT MEMBER : - THIS ASSESSEE S APPEAL FOR A.Y. 2010 - 11 , AR IS ES FROM ORDER OF THE CIT(A) - I, AHMEDABAD DATED 25 - 06 - 201 , IN PROCEEDINGS UNDER SECTION 143(3) R.W.S. 153C R.W.S. 153A(1)(B) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . I T (SS) A NO . 338 / A HD/20 14 A SS ESSMENT YEAR 2010 - 11 IT(SS)A NO. 338/AHD82014 A.Y. 2010 - 11 PAGE NO PATEL RAJESHKUMA R MAGANLAL & CO. 2 2. THE ASSESSEE HAS RAISED FOLL OWING GROUNDS OF APPEAL: - BEING AGGRIEVED BY THE ORDER PASSED BY THE LEARNED CIT (APPEAL) U/S. 250(6) OF THE INCOME - TAX ACT, YOUR APPELLANT FIRM SUBMITS FOLLOWING GROUNDS OF APPEAL AMONGST OTHERS FOR YOUR HONOUR'S KIND CONSIDERATIONS AND JUSTICE. 1 THE LEARNED ASSESSING OFFICER HAS GROSSLY AND GRIEVOUSLY ERRED IN LAW AND ON FACTS BY MAKING AN UNWARRANTED ADDITION OF RS.20.00 LACS U/S.69A OF THE INCOME - TAX ACT TREATING THE SAME AS UNDISCLOSED INCOME WITHOUT CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE IN ITS RIGHT PERSPECTIVE AND SPIRIT BY TWISTING THE FACTS JUST FOR THE SAKE OF MAKING THE ADDITION. FURTHER THE LD. CIT (A) CONFIRMED THE ADDITION MADE BY THE AO AND HENCE, YOUR APPELLANT FIRM PRAYS FOR DELETION OF THE ADDITION IN TOO. 2. (A) THE LEARNED CIT (A) HAS GROSSLY AND GRIEVOUSLY, ERRED IN LAW AND ON FACTS BY REJECTING THE BOOKS OF ACCOUNTS UNDER CONFUSION AND MISUNDERSTANDING WITHOUT ASSIGNING ANY VALID REASON. THE ID. CIT APPEAL SHOULD HAVE ACCEPTED THE BOOKS OF ACCOUNTS AS ACCEPTED BY LD. AO (B)THE LEARNED CIT (A) HAS FURTHER GROSSLY AND GRIEVOUSLY, ERRED IN LAW AND ON FACTS BY REJECTING THE BOOKS OF ACCOUNTS WITHOUT ANY MATERIAL IN THE HAND. (C)THE LEARNED CIT (A) HAS FURTHER GROSSLY AND GRIEVOUSLY, ERRED IN LAW AND ON FACTS BY REJ ECTING THE BOOKS OF ACCOUNTS BY HER WHILE THE LD. AO HAS ACCEPTED THE BOOK RESULT WHILE MAKING THE ADDITION OF RS. 20 LACS. (D) WITHOUT PREJUDICE TO ABOVE THE LD. CIT (A) HAS FURTHER GROSSLY AND GRIEVOUSLY, ERRED IN LAW AND ON FACTS THAT AFTER REJECTING TH E BOOKS OF ACCOUNTS LD. CIT (A) OMITTED TO ESTIMATE THE REASONABLE PROFIT AND FURTHER LD. CIT (A) WRONGLY CONFIRMED THE ADDITION OF RS. 20 LACS., 3. THE LEARNED CIT (A) HAS GROSSLY AND GRIEVOUSLY, ERRED IN LAW AN D ON FACT S BY NOT ADJUDICATING ON THE ADD ITION OF RS. 20,00,000 MADE BY THE AO INSTEAD OF THAT THE LD. CIT SUMMARILY DISMISSED THE APPEAL WITHOUT ANY BASIS. 4. THE LEARNED CIT (A) HAS GROSSLY AND GRIEVOUSLY, ERRED IN LAW AND ON FACTS BY NOT ADJUDICATING THE GROUNDS OF APPEAL FOR WRONGLY INITIATI NG THE PENALTY PROCEEDING U/S. 271(1)(C) OF THE INCOME - TAX ACT WITHOUT CONSIDERING THE FACTS AND CIRCUMSTANCE - S IN ITS RIGHT PERSPECTIVE AND SPIRIT AND HENCE, IT IS PRAYED TO CANCEL THE INITIATION OF THE PENALTY PROCEEDINGS AND OBLIGE. THE GROUNDS NUMBER 1 TO 3 OF THE ASSESSEE ARE INTERCONNECTED THEREFORE THEY ARE ADJUDICATED TOGETHER AS UNDER IN THIS ORDER. 3. THE BRIEF FACTS OF THE CASE IS THAT ASSESSEE IS A FIRM. THE POLICE AUTHORITY HAS SEIZED A CASH OF RS. 20 LACS AT INDORE FROM SHRI RAKESHBHA I RANCHHODBHAI AN EMPLOYEE OF THE ASSESSEE . I T WAS ADMITTED BY HIM T HAT THE CASH WAS BELONGED THE THE ASSESSEE FIRM. IT(SS)A NO. 338/AHD82014 A.Y. 2010 - 11 PAGE NO PATEL RAJESHKUMA R MAGANLAL & CO. 3 THEREFORE, PROCEEDINGS U/S. 153C R.W.S. 153A(1)(A) OF THE ACT WAS INITIATED BY ISSUING OF NOTICE U/S. 153C OF THE ACT ON 21 ST SEPTEMBER, 2012 . IN RESPONSE TO THE NOTICE , THE ASSESSEE HAS FILED NIL RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION. I T WAS CLAIMED THAT THE SEIZED CASH WAS REPRESENTED T HE BALANCE OF THE FIRM WHIC H WAS TRANSFERRED TO INDORE ON 9 TH MARCH 2010 FOR PURCHASE OF I MMOVABLE PROPERTY. THE ASSESSING OFFICER HAS STATED IN THE SHOW CAUSED NOTICE THAT NO PARTNER WAS PRESENT AT INDORE TO FINALIZE THE PURCHASE OF PROPERTY AND NO COLLABORATED EVIDENCE FOUND TO INDICATE THAT THE SOURCE OF SEIZE D CASH OF RS. 15 L ACS WAS BORROWED FROM SHRI DAVAL EXPORT S ON 1 ST DECEMBER, 2007 . T HE ASSESSING OFFICER HAS STATED THAT IN RESPONSE TO SHOW CAUSE NOTICE THE ASSESS EE HAS FI L ED SUBMISSION WHICH WAS NOT ACCEPTABLE . W E HAVE NOTICED THAT ASSESSING OFFICER HAS NOT GIVEN ANY D ETAILS OF SUBMISSION FILED BY THE ASSESSEE IN RESPONSE TO THE SHOW CAUSED NOTICE . THE ASSESSING OFFICER HAS CONCLUDED WITH REASONS MENTIONED AT PARA 6 OF THE ASSESSMENT ORDER THAT THE AMOUNT OF RS.20 LAKHS REPRESENT THE UNACCOUNTED INCOME OF THE ASSESSEE U/S 69A OF THE ACT. 4. AGGRIEVED ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A). THE LD. CIT(A) HAS REJECTED THE APPEAL OF T HE ASSESSEE ON THE GROUND THAT NO SUPPORTING EVIDENCES WERE PRODUCED TO VERIFY THE ENTRY IN THE BOOKS OF ACCOUNTS. 5. DURING T HE COURSE OF APPELLATE PROCEEDINGS BEFORE US, THE LD. COUNSEL HAS SUBMITTED PAPER BOOK CONTAINING WRITTEN SUBMISSION IT(SS)A NO. 338/AHD82014 A.Y. 2010 - 11 PAGE NO PATEL RAJESHKUMA R MAGANLAL & CO. 4 MADE BEFORE THE LD. CIT(A), COPY OF REPLY GIVEN TO SHOW CAUSE NOTICE, COPY OF SUBMISSION, COPY OF BANK STATEMENT, COPY OF CASH BOOK ETC. HE F URTHER CONTENDED THAT LD. CIT(A) HAS NOT TAKEN IN TO CONSIDERATION THE RELEVANT INFORMATION AND DETAILS IN RESPECT OF SOURCE OF CASH SEIZED FROM THE EMPLOYEE OF THE ASSESSEE. O N THE OTHER HAND, LD. DEPARTMENTAL REPRESENTATIVE RELIED ON THE ORDER OF THE LD. CIT(A). 6 . WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD CAREFULLY. WE OBSERVED THAT THE ASSESSING OFFICER IN HIS ASSESSMENT ORDER AT PAGE NO. 3 HAS SI MPLY S TATED THAT SUBMISSION FILED BY T H E ASSESSEE IS NOT ACCEPTABLE WITHOUT ELABORATING THE SUBMISSION OF THE ASSESSEE . SIMILARLY, THE LD. CIT(A) H AS ALS O NOT E LABORATED IN THE DETAILS AND SUPPORTING EVIDENCES FURNISHED BY THE ASSESSEE IN RESPECT OF SOURCE OF RS. 20 LACS SEIZED FROM THE EMPLOYEE OF THE ASSESSEE . B EFORE US, THE LD. COUNSEL HAS CONTENDED THAT THE ASSESSEE WAS HAVING CASH IN HAND OF THE BRANCHES WHICH WAS TRANSFERRED FROM ONE BRANCH TO ANOTHER BRANCH . HE FURTHER CONTENDED THAT THE SUPPORTING LEDGER ACCOUNT, BILL VOUCHER , WERE MAINTAINED WHICH WAS NOT CONSIDERED BY THE LOWER AUTHORITIES. AFTER CONSIDERING THE ABOVE FACTS AND FINDINGS, WE ARE OF THE CONSIDERED OPINION THAT IN T H E INTEREST OF JUSTICE, IT WILL BE APPROPRIATE TO RESTORE THIS CASE TO THE ASSESSING OFFICER TO DECIDE THE ISSUE DE NOVO AFTER VERIF ICATION OF THE INFORMATION / DETAIL AND EVIDENCES FILED BY THE ASSESS EE AFTER AFFORDING ADEQUATE OPPORTUNITIES TO THE ASSESSEE. ACCORDINGLY , THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PUR POSES. IT(SS)A NO. 338/AHD82014 A.Y. 2010 - 11 PAGE NO PATEL RAJESHKUMA R MAGANLAL & CO. 5 7. THE GROUNDS NUMBER 4 OF THE ASSESSEE REGARDING INITIATING OF PENALTY IS NOT REQUIRED ANY ADJUDICATION AS THE ASSESSING OFFICER CAN INITIATE IT AT THE ASSESSMENT STAGE. 8 . IN THE RESULT, THE APPEAL OF T HE ASSESSEE IS ALLOWED FOR STATISTICAL PUR POSE. ORDER PR ONOUNCED IN THE OPEN C OURT ON 19 - 12 - 201 7 SD/ - SD/ - ( RAJPAL YADAV ) ( AMARJIT SINGH ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD : DATED 19 /12 /2017 / COPY OF ORDER FORWARDED TO: - 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,