Smt. Kokilaben Dhirajlal Sanghvi, Ahmedabad V. The Dy.CIT, Central Circle-2(4), Ahmedabad

ITSSA 46/AHD/2015

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 3405 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 1 month(s) 9 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 29-04-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 19-06-2017
• Assessment Year: 2005-2006
• Appeal Filed On: 20-03-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: O P SHARMA
• Assessee Lawyers: P M MEHTA
• Keywords: Unexplained cash credit; Set aside
• Section: 143(3); 142(1); 153A; 131

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH (BEFORE SHRI MAHAVIR PRASAD, JUDICIAL MEMBER & SHRI WASEEM AHMED, ACCOUNTANT MEMBER) IT(SS)A. NOS: 46 TO 48/AHD/2015 (ASSESSMENT YEARS: 2005-06 TO 2007-08) SMT. KOKILABEN DHIRAJLAL SANGHVI A/14/21, TIRTHBHUMI APARTMENT, ELLISBRIDGE, AHMEDABAD- 380006 V/S DCIT, CENTRAL CIRCLE-2(4), AHMEDABAD (APPELLANT) (RESPONDENT) PAN: AEDPS3414B APPELLANT BY : SHRI P.M. MEHTA, A.R. RESPONDENT BY : SHRI O.P. SHARMA, CIT/ D.R. ( )/ ORDER DATE OF HEARING : 25 -04-201 8 DATE OF PRONOUNCEMENT : 29-04-2019 PER MAHAVIR PRASAD, JUDICIAL MEMBER 1. THESE THREE APPEALS FILED BY THE ASSESSEE ARE DIREC TED AGAINST THE ORDER OF THE LD. CIT(A)-12, AHMEDABAD DATED 24.12.2014 PERTAININ G TO A.YS. 2005-06 TO IT(SS)A NOS. 46TO 48/AHD/2015 . A.YS. 2005- 06 TO 2007-08 2 2007-08. IN ALL THREE APPEALS HAVE TAKEN SOLITARY G ROUND THAT LD. A.O. MADE ADDITION U/S. 153A R.W.S. 143(3) WITHOUT ANY INCRIM INATING DOCUMENT WAS FOUND DURING SEARCH. 2. FACTS OF THE CASE ARE THAT THE APPELLANT FILED HER RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION DECLARING INCOME AT RS, 1,94,10 0/- WHICH WAS ASSESSED BY THE ASSESSING OFFICER AT INCOME OF RS, 15,97,100/- BY MAKING ADDITIONS AS UNDER: PARTICULARS AMOUNT INCOME AS PER RETURN OF INCOME RS. 1,94,100 ADD: UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT RS. 14,03,000 INCOME ( ROUNDED OFF) RS. 15,97,100 THE FOLLOWING DISPUTE ARISES OUT OF AFORESAID ORDER PASSED BY ASSESSING OFFICER. 3. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASS ESSING OFFICER OBSERVED THAT THE APPELLANT HAD UNSECURED LOAN TAKEN FROM BA BUBHAI M. DESAI AMOUNTING TO RS, 14,03,000/-. THE ASSESSING OFFICER HAS MADE THE ADDITION SIMPLY ON THE GROUND THAT MR. BABUBHAI M. DESAI WAS NOT AWARE OF THE AMOUNT GIVEN, AND NO INTEREST WAS CHARGED ON THE SA ID LOAN. ACCORDINGLY, THE SAID SENDER HAS NO CREDIT WORTHINESS TO GIVEN SUCH LOAN TO THE APPELLANT RESULTING IN ADDITION OF RS. 14,03,000/-FOR THE PRE SENT ASSESSMENT YEAR. IN THIS CONNECTION, THE APPELLANT SUBMITS AS UNDER; SR. NO. PARTICULARS 1 DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE APP ELLANT HAD PROVIDED THE CONFIRMATION ACCOUNT OF BABUBHAI M. DE SAI IN IT(SS)A NOS. 46TO 48/AHD/2015 . A.YS. 2005- 06 TO 2007-08 3 RESPECT OF LOAN TAKEN FROM HIM. 2 SINCE BABUBHAI M. DESAI HAD APPEARED BEFORE THE ASS ESSING OFFICER, HIS IDENTITY WAS PROVED. 3 IN THE STATEMENT RECORDED OF BABUBHAI M. DESAI, HE HAS NOT DENIED THE FACT THAT A LOAN WAS GIVEN TO THE APPELL ANT AND HE HAS CLEARLY STATED AND ALSO APPRECIATED BY THE ASSESSIN G OFFICER THAT A SUM OF RS. 15 LACS WAS GIVEN TO DHIRUBNAI SANGHVI AND HIS FAMILY MEMBERS FROM F.Y. 2004-05 TO 2010-11. 4 THE ENTIRE SUM OF RS. 14,03,000 WAS RECEIVED THROUG H BANKING CHANNEL WHICH PROVES THE GENUINENESS OF THE TRANSAC TION CARRIED OUT WITH BABUBHAI M. DESAI. 5 WITH REFERENCE TO THE SOURCE OF RS. 14,03,000, BABU BHAI M. DESAI HAD VERY CLEARLY STATED VIDE ANSWER NO. 9 OF HIS ST ATEMENT THAT HE WAS NOT ABLE TO RECOLLECT THE SOURCE OF LOAN GIVEN AND WOULD GIVE AFTER VERIFYING THE SAME, 4. FURTHER, THE APPELLANT SUBMITS THAT THAT THE UNSECU RED LOAN TAKEN FROM BABUBHAI M. DESAI REPAID PARTLY BEFORE THE COMPLE TION OF THE ASSESSMENT PROCEEDINGS THROUGH ACCOUNT PAYEE CHEQUES WHICH PRO VE THE GENUINENESS OF THE TRANSACTIONS ENTERED BY THE APPELLANT. 5. REGARDING THE RETURN FOR THE ASSESSMENT YEAR 2005-0 8 WAS NOT FILED BY BABUBHAI M. DESAI IT IS SUBMITTED, THAT TO THE BEST OF THE KNOWLEDGE OF THE ASSESSES SINCE HIS INCOME DID NOT EXCEEDED MAXIMUM AMOUNT CHARGEABLE TO INCOME TAX, THE RETURN FOR ASSESSMENT YEAR 2005-06 WAS NOT FILED. THE RETURN WHICH WAS FILED WITH THE DEPARTMENT, THE APPELLANT HAD SUBMITTED THE COPY DURING THE COURSE OF PROCEEDINGS. 6. IN VIEW OF WHAT IS STATED HEREIN1 ABOVE, THOUGH ASS ESSING OFFICER IS HEAVILY RELYING ON STATEMENT RECORDED UNDER SECTION 131 OF BABUBHAI M. DESAI, IT IS IT(SS)A NOS. 46TO 48/AHD/2015 . A.YS. 2005- 06 TO 2007-08 4 VERY DEAR FROM HIS STATEMENT THAT THERE IS NO DENIA L OF LOAN GIVEN BY SAID PERSON TO MR. DHIRAJLA! V. SANGHVT & HIS FAMILY MEMBERS (T O WHICH THE APPELLANT BELONGS) NOR THERE IS ANY CIRCUMSTANTIAL EVIDENCE W HICH CAN PROVE THAT LOAN TAKEN BY APPELLANT IS NON-GENUINE. APPELLANT HAS AL SO SUBMITTED ALL THE NECESSARY EVIDENCES AS STATED HEREIN ABOVE TO PROVE THE IDENTITY, GENUINENESS AND CREDITWORTHINESS OF THE TRANSACTION. HENCE, THE RE IS NOTHING EMANATING FROM THE STATEMENT OF BABUBHAI M. DESAI WHICH CAN P ROVE THAT THE LOAN BY APPELLANT IS NON-GENUINE AND AS SUCH RELIANCE PLACE D BY ASSESSING OFFICER ON THIS STATEMENT CANNOT BE CONSIDERED. 7. THEREAFTER, ASSESSEE PREFERRED FIRST STATUTORY APPE AL BEFORE THE LD. CIT(A) WHO CONFIRMED THE ACTION OF THE LD. A.O. 8. NOW APPELLANT HAS COME BEFORE US AGAINST THE ORDER OF LD. CIT(A). 9. WE HAVE GONE THROUGH THE RELEVANT RECORD AND IMPUGN ED ORDER AND HEARD BOTH THE PARTIES. IN THIS CASE, ASSESSEE WAS CARRIED OUT IN THE GROUP CASES OF SANGHVI GROUP ON 09.03.2011. THE LD. A.O. ISSUED NOTICE TO THE ASSESSEE U/S. 153A ON 28.09.2011 REQUIRING TO THE ASSESSEE RETURN WITHIN 30 DAYS FROM THE DATE OF RECEIPT OF NOTICE. 10. IN RESPONSE TO THE NOTICE, ASSESSEE FILED RETURN ON 16.03.2012 DECLARING INCOME OF RS. 3,30,501/-. THE OBJECTION RAISED BY THE ASSE SSEE WITH REGARD TO ISSUANCE OF NOTICE U/S 153A WAS REBUTTED VIDE LETTER DATED 1 0.12.2012. THEREAFTER NOTICES U/S. 142(1) AND 143(2) WERE ISSUED. IT(SS)A NOS. 46TO 48/AHD/2015 . A.YS. 2005- 06 TO 2007-08 5 11. DURING THE COURSE OF ASSESSMENT PROCEEDING, IT IS O BSERVED ASSESSEE HAD TAKEN LOAN OF RS. 20,000/- FROM ONE SHRI MUKTESHAWAR K. V ERMA AND IN ITS STATEMENT BEFORE THE LD. A.O. AND HE COULD NOT GIVE SOURCE AS LOAN ALONG WITH COPIES OF BANK ACCOUNT ETC. THEREAFTER ADDITION OF RS. 20,000 /- WAS MADE IN THE HAND OF ASSESSEE. 12. DURING THE COURSE OF HEARING, LD. A.R. VEHEMENTLY A RGUED THE ADDITION HAVE BEEN MADE WITHOUT ANY INCRIMINATING MATERIAL AND CO NTENDED THAT ASSESSMENT U/S. 153A CANNOT MADE IN COMPLETED ASSESSMENT AND T HAT TO WITHOUT ANY INCRIMINATING MATERIAL. 13. IN SUPPORT OF ITS CONTENTION, LD. A.R. CITED AN ORD ER OF CO-ORDINATE BENCH IN IT(SS)A NOS. 153 TO 156/AHD/2016 WHEREIN SIMILAR CI RCUMSTANCES RELIEF HAS BEEN GRANTED TO THE ASSESSEE AND RELEVANT PARA OF T HE SAID ORDER IS REPRODUCED: 13. NOW, LET US EXAMINE THE AFOREMENTIONED RATIOS L AID DOWN BY THE HON'BLE HIGH COURTS IN THE LIGHT OF THE DOCUMENTS FOUND AT THE TIME OF SEARCH WHICH MAY BE CONSIDERED AS INCRIMINATING FOR MAKING THE IMPUG NED ASSESSMENTS. SURPRISINGLY, THERE IS NOT EVEN A WHISPER OF ANY IN CRIMINATING MATERIAL FOUND AT THE TIME OF SEARCH WHICH COULD BE CONSIDERED AS THE BASIS FOR FRAMING ASSESSMENTS U/S. 153A OF THE ACT. AS, THERE IS NO A LLEGED INCRIMINATING MATERIAL WHICH COULD HAVE PROMPTED THE A.O. TO DISTURB THE C ONCLUDED ASSESSMENT. THEREFORE, WE DO NOT FIND ANY LEGALITY IN THE ASSES SMENTS SO MADE BY THE A.O. WE HAVE NO HESITATION TO SET ASIDE THE FINDINGS OF THE ID. CIT(A) AND DIRECT THE A.O. TO DELETE THE IMPUGNED ADDITIONS FROM THE HANDS OF THE AFOREMENTIONED ASSESSEES MADE U/S. 153A OF THE ACT IN THE RESPECTIVE ASSESSM ENT YEARS MENTIONED HEREINABOVE. IN OUR CONSIDERED OPINION, THE ASSESSM ENTS MADE WITHOUT ANY INCRIMINATING MATERIAL IS ILLEGAL AND BAD IN LAW AN D ARE ACCORDINGLY QUASHED. IT(SS)A NOS. 46TO 48/AHD/2015 . A.YS. 2005- 06 TO 2007-08 6 14. SINCE ADDITION HAVE BEEN MADE IN COMPLETED ASSESSME NT U/S. 153A WITHOUT ANY INCRIMINATING MATERIAL IN SUCH CASE ADDITION CA NNOT BE SUSTAINED. IN PARITY WITH THE CO-ORDINATE BENCH DECISION, WE ALLOW ALL T HREE APPEALS OF THE ASSESSEE. 15. IN THE RESULT, ALL THE APPEALS FILED BY THE ASSESSE E ARE ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 29- 04- 2019 SD/- SD/- (WASEEM AHMED) (MAHAVIR PRASAD) ACCOUNTANT MEMBER TRUE COPY JUDICIAL MEMBER AHMEDABAD: DATED 29/04/2019 RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD