Shri Narayanbhai R.Patel, Ahmedabad V. The ACIT.,Cent.Circle-1(2), Ahmedabad

ITSSA 501/AHD/2012

• Counselvise Citation: [2012] 121 COUNSELVISE.COM (IT) 8559 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 month(s) 3 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 14-12-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2004-2005
• Appeal Filed On: 11-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: Y P VERMA
• Keywords: Income from undisclosed sources; Search and seizure; Documents seized
• Section: 143(3); 153A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD B BENCH BEFORE: SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER AND SHRI T.R. MEEN A, ACCOUNTANT MEMBER NARAYANBHAI R. PATEL 118, TAPOVAN SOCIETY AMBAWADI, AHMEDABAD- 380015 PAN ACOPP 9208 R (APPELLANT) VS. ACIT, CENT. CIR 1(2) AHMEDABAD (RESPONDENT) REVENUE BY : SRI Y.P. VERMA, SR. D.R. ASSESSEE BY : SRI VIVEK CHAVDA, A.R. DATE OF HEARING : 11-12-2012 DATE OF PRONOUNCEMENT : 14-12-2012 / ORDER PER : T.R. MEENA, ACCOUNTANT MEMBER:- THIS IS THE APPEAL OF THE ASSESSEE EMANATING FROM T HE ORDER OF THE LD. CIT(A)-I AHMEDABAD DATED 13-08-2012 FOR THE PERIOD OF A.Y. 04-05. IT(SS)A NO. 501/AHD/2012 A.Y.:-2004-05 IT(SS)A NO.501 /AHD/2012 A.Y. 2004-05 PAGE N O NARAYANBHAI R. PATEL VS. ACIT 2 2. THE SOLE GROUND OF APPEAL IS AGAINST CONFIRMING THE PENALTY OF RS. 3,54,750/- IMPOSED U/S 271(1)(C) OF THE I.T. ACT. 3. THE AO MADE ADDITION ON ACCOUNT OF UNACCOUNTED INCOME ON THE BASIS OF SEIZED MATERIAL AT RS. 10,75,000/- U/S 153 A READ WITH 143(3) OF THE I.T. ACT. THERE WAS A SEARCH AND SEIZURE OPERATION . THE AO OBSERVED THAT ON PERUSAL OF THE PAGE NO. 101 AND 111 OF LOOSE PAP ER FILE A-241 FOUND AND SEIZED FROM VEHICLE NO. GJ1 HF 251 (STATIONED VAN T OYOTA VEHICLE OWNED AND CLAIMED BY VIKAS A. SHAH) IT IS NOTICED THAT AN AMOUNT OF RS. 20,00,000/- SHOWN TO HAVE RECEIVED BY SHRI NARAYANB HAI R. PATEL FROM SHRI VIKAS A SHAH DURING THE ASSESSMENT YEAR 2004-05. T HE SAME WAS ALSO CONFIRMED BY SHRI VIKAS A. SHAH IN HIS STATEMENT (A NS. NO. 12 & 85) RECORDED U/S. 131(1)(A) OF THE ACT DURING THE COURS E OF POST SEARCH INVESTIGATION. SHRI NARAYANBHAI R. PATEL WAS ALSO EXAMINED U/S 131(1)(A) OF THE ACT ON 04.04.2005 BY ADIT (INV.) MEHSANA. IN H IS STATEMENT ASSESSEE HIMSELF ADMITTED THAT HE HAD ARGUED THAT CASES RELA TED TO THE LAND AT SURVEY NO. 188 AND 189 VASNA IN THE CIVIL COURT, AHMEDABAD ON BEHALF OF SHRI VIKAS A. SHAH. 3.1 HE FURTHER ADMITTED THAT HE RECEIVED FEES OF RS . 5,00,000/- AND RS. 3,00,000/- FROM CHHATRA CHHAYA CO-OP. HOUSING SOCI ETY AND NEW CHHAYA CO-OP. HOUSING SOCIETY RESPECTIVELY. HE ALSO ADMIT TED TO RECEIVED RS. 50,000/-AND RS. 75,000/- FROM THESE TWO CO-OP. HOUS ING SOCIETIES FOR GETTING THE TITLE CLEARANCE CERTIFICATE AND DRAFTIN G OF THE SALE DEED. THUS, HE ADMITTED TO HAVE RECEIVED TOTAL OF RS. 9.25 LAKHS A ND AGAINST RS. 20,00,000/- RECORDED ON PAGE NO. 111 AND RS. 16.25 LAKHS RECORD ED ON PAGE NO. 109 OF A-241. THE AO HAS GIVEN REASONABLE OPPORTUNITY ON THESE SEIZED IT(SS)A NO.501 /AHD/2012 A.Y. 2004-05 PAGE N O NARAYANBHAI R. PATEL VS. ACIT 3 DOCUMENTS. THE APPELLANT ALSO REPLIED VIDE VARIOUS LETTERS BEFORE THE AO BUT THE LD. AO HAD NOT CONVINCED WITH THE REPLY OF THE APPELLANT. THUS, HE MADE ADDITION OF RS.10,75000/- IN THE INCOME OF THE ASSESSEE AS UNACCOUNTED INCOME. THE AO ALSO INITIATED PENALTY PROCEEDING U/S 271(1)(C) FOR CONCEALMENT OF INCOME. THE ORIGINAL ADDITION WAS CHALLENGED BY THE APPELLANT BEFORE THE LD. CIT(A) WHO HAD CONF IRMED THE ADDITION. THE APPELLANT FILED SECOND APPEAL BEFORE THE HONBLE CO -ORDINATE BENCH OF ITAT IN ITA NO. 1468/A/2009 FOR A.Y. 04-06 WHEREIN THE FOLLOWING ADDITIONAL GROUND WAS RAISED BY THE APPELLANT. THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE, A S WELL AS IN LAW, THE NOTICE ISSUED U/S 153A OF THE ACT AND THE PROCEEDINGS INITIATED THERE UNDER BY AO WERE INVALID AND WITHOU T JURISDICTION. THAT BOTH THE LOWER AUTHORITIES HAVE FAILED TO APPR ECIATE THAT PROCEEDINGS U/S 153A OR 153C OF THE ACT COULD NOT B E INITIATED, UNLESS THE MONEY, BULLION OR OTHER VALUABLE ARTICLE OR BOO KS OF ACCOUNT OR DOCUMENTS SEIZED BELONG TO THE ASSESSEE AGAINST WHO M SUCH NOTICE WAS TO BE ISSUED. 4. THE CO-ORDINATE B BENCH VIDE ITS ORDER DATED 2 1-09-2012 HAS QUASHED THE ORDER PASSED BY THE AO U/S 153A READ WI TH 143(3) OF THE I.T. ACT. THE OPERATIVE PAT IS AS UNDER:- WE FIND THAT IN THE INSTANT CASE ALSO PAGE NOS. 10 9 AND 111 FOUND AND SEIZED FROM THE VEHICLE OF VIKAS A SHAH W ERE NOT IN THE HANDWRITING OF THE ASSESSEE. THROUGH IT WAS MENTIO NED ON THESE PAPERS THAT SOME AMOUNT WAS SHOWN TO HAVE BEEN RECE IVED BY THE ASSESSEE, IT CANNOT BE SAID THAT THESE DOCUMENTS BE LONGED TO THE ASSESSEE. THE FACTS OF THE CASE LAWS RELIED BY THE REVENUE ARE NOWHERE NEAR TO THE FACTS OF THE INSTANT CASE. THE REFORE, RESPECTFULLY FOLLOWING THE DECISION OF HONBLE GUJRAT HIGH COURT (SUPRA) THE NOTICE ISSUED U/S 153A OF THE ACT AND THE PROCEEDIN GS INITIATED THERE IT(SS)A NO.501 /AHD/2012 A.Y. 2004-05 PAGE N O NARAYANBHAI R. PATEL VS. ACIT 4 UNDER BY THE A.O. ARE HEREBY HELD TO BE INVALID AND WITHOUT JURISDICTION AND THE ORDER PASSED BY THE A.O. U/S 1 53A READ WITH SECTION 143(3) OF THE ACT IS HEREBY QUASHED. 5. THE LD. AO HAD IMPOSED THE PENALTY ON ADDITION O F RS. 10,75,000/- AFTER GIVING A REASONABLE OPPORTUNITY OF BEING HEA RD AT RS. 3,54,750/- ON 15- 03-2010 WHICH WAS ALSO CHALLENGED BY THE APPELLANT BEFORE THE LD. CIT(A) AHMEDABAD WHO HAD DISMISSED THE APPEAL AND HELD THA T SHRI. VIKAS A SHAH HAD CONFIRMED HAVING PAID AND THE APPELLANT HIMSELF ADMITTED HAVING RECEIVED PAYMENTS BUT CHANGED STAND ABOUT THE AMOUN T RECEIVED. THE ADDITION OF RS. 10,75,000/- STAND UPHELD IN FIRST A PPEAL AND RELYING UPON THE DETAILED FINDINGS OF THE ORDER DATED 30-03-2009 OF PREDECESSOR AND POINT SUMMARIZED IN PARA 7 OF THE APPEAL ORDER, THE PENAL TY U/S 271(1)(C) LEVIED AT RS. 3,54,750/- BY THE ACIT, CENTRAL CIRCLE 1(2) WAS UPHELD. 6. NOW, THE ASSESSEE IS BEFORE US. LD. COUNSEL FOR THE ASSESSEE CONTENDED THAT WHEN THE ORDER PASSED U/S 153(A) REA D WITH SECTION 143(3) OF THE I.T. ACT BY THE LD. AO HAD BEEN QUASHED TO THE EXTENT OF ADDITION MADE OF RS. 10,75,000/- WHEN MAIN ADDITION HAS BEEN DELE TED BY THE HONBLE ITAT C BENCH VIDE ITA NO. 1468/A/2009 A.Y. 2004-0 5. THEREFORE, THE PENALTY DOES NOT SURVIVE IN ABSENCE OF ORIGINAL ADD ITION. THUS, HE REQUESTED TO DELETE THE PENALTY. THE LD. D.R. FAIRLY ACCEPTE D THE FACT. 7. WE HAVE PERUSED THE ORDER OF THE AUTHORITIES BEL OW AND GONE THROUGH THE B BENCH DECISION FOR QUANTUM WHERE MAIN ADDI TION THE ORDER PASSED U/S 153A READ WITH RULE 143(3) HAS BEEN QUASHED BY THE CO-ORDINATE BENCH. THUS, THE PENALTY IMPOSED BY THE AO IS NOT SURVIVED . THUS, THE APPEAL OF THE ASSESSEE IS ALLOWED IN HIS FAVOUR. IT(SS)A NO.501 /AHD/2012 A.Y. 2004-05 PAGE N O NARAYANBHAI R. PATEL VS. ACIT 5 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE AT CAPTION PAGE SD/- SD/- (MUKUL KR. SHRAWAT) (T.R.MEEN A) JUDICIAL MEMBER ACC OUNTANT MEMBER AHMEDABAD : DATED 14 /12/2012 AK / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT 2. / RESPONDENT 3. / CONCERNED CIT 4. - / CIT (A) 5. , ! , '# / DR, ITAT, AHMEDABAD 6. $% &' / GUARD FILE. BY ORDER/ , ( / ' ) ! , '#