ACIT, Ernakulam V. M/s Doric Con, Cochin

ITSSA 51/COCH/2008

• Counselvise Citation: [2012] 121 COUNSELVISE.COM (IT) 8386 (ITAT-COCHIN)
• Duration Of Justice: 4 year(s) 2 month(s) 24 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 24-08-2012
• Appeal Filed By: Department
• Bench Allotted: DB
• Next Hearing Date: 09-08-2012
• Assessment Year: misc
• Appeal Filed On: 30-05-2008
• Court: TRIBUNAL
• Department Lawyers: A S BINDHU
• Assessee Lawyers: P K SASIDHARAN
• Keywords: Search and seizure; Opportunity of being heard
• Section: 142(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE S/SHRI N.R.S.GANESAN, JM AND B.R.BASKAR AN, AM I.T.(SS)A NO.51/COCH/2008 BLOCK PERIOD: 1991-92 TO 2001-02(PART) THE ASSISTANT COMMISSIONER OF INCOME-TAX,CIRCLE-1(2), ERNAKULAM VS. M/S. DORCI-CON, C/O SHRI V.H. YAHIA, VANIYAPARAMBIL, MAR ROAD, COCHIN-2. [PAN: D-301] (REVENUE-APPELLANT) (ASSESSEE-RESP ONDENT) C.O. NO. 58/COCH/2008 (ARSG. OUT OF I.T.(SS)A NO.51/COCH/2008) BLOCK PERIOD: 1991-92 TO 2001-02(PART) M/S. DORCI-CON, C/O SHRI V.H. YAHIA, VANIYAPARAMBIL, MAR ROAD, COCHIN-2. [PAN: D-301] VS. THE ASSISTANT COMMISSIONER OF INCOME-TAX,CIRCLE-1(2), ERNAKULAM (ASSESSEE -APPELLANT) (REVENUE- RESPONDENT) REVENUE BY SMT. A.S. BINDHU, SR. DR ASSESSEE BY SHRI P.K.SASIDHARAN, CA DATE OF HEARING 09/08/2012 DATE OF PRONOUNCEMENT 24/08/2012 O R D E R PER B.R.BASKARAN, ACCOUNTANT MEMBER: THE APPEAL OF THE REVENUE AND THE CROSS OBJECTION FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER DATED 28.1.2008 PASSED B Y LD CIT(A)-I, KOCHI AND THEY RELATE TO THE BLOCK PERIOD ENDING 06-09-2000. I.T.(SS)A. NO. 51/COCH/2008 & C.O. NO. 58/COCH/2008 2 2. THE REVENUE IS ASSAILING THE DECISION OF LD CIT(A) IN DELETING THE ADDITION OF RS.18,26,622/- AND RS.28,323/- BEING THE PROFITS MA DE IN PURCHASE AND SALE OF LAND DURING THE ASSESSMENT YEARS 1995-96 AND 1994-95 RES PECTIVELY. IN THE CROSS OBJECTION, THE ASSESSEE IS AGGRIEVED BY THE ACTION OF LD CIT(A ) IN NOT DISPOSING VARIOUS GROUNDS RAISED BEFORE HIM. 3. THE FACTS RELATING TO THE CASE ARE STATED IN BRIEF. THE ASSESSEE IS A PARTNERSHIP FIRM IN WHICH SHRI V.H.YAHIA IS THE MANAGING PARTNE R. THE DEPARTMENT CARRIED OUT SEARCH AND SEIZURE OPERATIONS IN THE HANDS OF SHRI V.H.YAHIA ON 06.9.2000, DURING THE COURSE OF WHICH CERTAIN DOCUMENTS RELATING TO THE A SSESSEE FIRM WAS UNEARTHED. ACCORDINGLY THE AO INITIATED PROCEEDINGS U/S 158BD OF THE ACT IN THE HANDS OF THE ASSESSEE. THE ASSESSEE FIRM DID NOT FILE ANY BLOCK RETURN BEFORE THE AO, DESPITE THE ISSUE OF FURTHER NOTICES U/S 142(1) OF THE ACT. TH OUGH THE THEN AUTHORISED REPRESENTATIVE OF THE ASSESSEE NAMED SHRI V.C.JAMES , CHARTERED ACCOUNTANT APPEARED BEFORE THE AO IN THE ASSESSMENT PROCEEDINGS, YET HE EXPRESSED HIS INABILITY TO PROVIDE ANY FURTHER INFORMATION/EXPLANATIONS FOR WANT OF CO -OPERATION FROM THE ASSESSEE. HENCE THE AO PROCEEDED TO COMPLETE THE ASSESSMENT B Y DETERMINING THE UNDISCLOSED INCOME AS UNDER:- PROFIT FROM DORIC-DALE PROJECT (AY 1994-95) 2,50, 000 PROFIT FROM LAND DEALINGS (AY 1994-95) 28,323 PROFIT FROM LAND DEALINGS (AY 1995-96) 1 8,26,622 ----------------- 21,04,945 ======== 4. THE ASSESSEE CARRIED THE MATTER IN APPEAL BE FORE LD CIT(A) AND THE FIRST APPELLATE AUTHORITY CONFIRMED THE ADDITION OF RS.2,50,000/- R ELATING TO THE PROFIT FROM DORIC-DALE BUILDING PROJECT. THE LD CIT(A) DELETED THE REMAI NING TWO ADDITIONS ON THE GROUND THAT THERE IS NO MATERIAL TO LINK THE LAND DEALINGS WITH THE ASSESSEE FIRM. AGGRIEVED, THE REVENUE IS IN APPEAL BEFORE US WITH THE CONTENT ION THAT THE MANAGING PARTNER SHRI V.H.YAHIA HAD ADMITTED IN HIS SWORN STATEMENT THAT THE PROFIT FROM LAND DEALINGS WAS EARNED BY THE FIRM. I.T.(SS)A. NO. 51/COCH/2008 & C.O. NO. 58/COCH/2008 3 5. WHILE COMPLETING THE ASSESSMENT, THE AO TOOK THE STATUS OF THE ASSESSEE AS INDIVIDUAL. HENCE THE ASSESSEE HAD RAISED GROUND S RELATING TO THE ABOVE POINT AND ALSO RAISED GROUNDS ABOUT THE VALIDITY OF ASSESSMEN T PROCEEDINGS CARRIED OUT U/S 158BD R.W.S. 158BC. HOWEVER, THE LD CIT(A) DID NOT DISPO SE OF THOSE GROUNDS AND HENCE THE ASSESSEE HAS RAISED THESE ISSUES IN THE CROSS OBJEC TION FILED BY IT. 6. WE HAVE THE PARTIES AND PERUSED THE RECORD. WE NOTICE THAT THE ASSESSEE DID NOT CO-OPERATE WITH THE AO BY FILING THE BLOCK RETURN A ND ALSO DID NOT FURNISH ANY OTHER INFORMATION. HENCE THE AO WAS CONSTRAINED TO COMPL ETE THE ASSESSMENT TO THE BEST OF HIS JUDGEMENT. HOWEVER, IT IS NOT DISCERNIBLE AS T O WHY THE AO TOOK THE STATUS AS INDIVIDUAL. THE REVENUE CONTENDS THAT THE MANAGI NG PARTNER SHRI YAHIYA HAD ADMITTED IN HIS SWORN STATEMENT THAT THE PROFIT FRO M LAND DEALINGS BELONG TO THE FIRM. HOWEVER THE ASSESSEE DISPUTES THE SAID CONTENTION. HOWEVER, BOTH THE PARTIES HAVE FAILED TO PRODUCE A COPY OF THE SWORN STATEMENT BEF ORE US. HENCE, WE ARE UNABLE TO APPRECIATE THE CONTENTIONS OF THE BOTH THE PARTIES. 7. WE ALSO NOTICE THAT THE DETAILS OF THE PARTNE RS OF THE ASSESSEE FIRM ARE NOT AVAILABLE ON RECORD. THE AO HAS STATED THAT THE PR OFITS FROM LAND DEALINGS WERE SHARED EQUALLY BY SHRI YAHIHA, SHRI K.K.NAIR AND SHRI ALI BASHEER, THOUGH THE LAND DEALINGS WERE CONDUCTED BY THESE THREE PERSONS ALONG WITH SH RI V.M.FAIZAL. HOWEVER, IT IS NOT KNOWN WHETHER ALL THESE PERSONS ARE ALSO PARTNERS O F THE ASSESSEE FIRM OR NOT. WE NOTICE THAT THE LD CIT(A) HAS TAKEN DECISION IN FAV OUR OF THE ASSESSEE WITHOUT EXAMINING THE PARTNERSHIP DEED, WHICH IN OUR VIEW, IS VERY MUCH NECESSARY BEFORE TAKING ANY DECISION ON THIS ISSUE. 8. BESIDES THE ABOVE, THE LD CIT(A) HAS FAILED TO DISPOSE OF VARIOUS LEGAL GROUNDS RAISED BY THE ASSESSEE. 9. IN VIEW OF THE FOREGOING DISCUSSIONS, WE ARE OF THE VIEW THAT ALL THE ISSUES CONTESTED IN THE APPEAL OF THE REVENUE AND THE CROS S OBJECTIONS OF THE ASSESSEE REQUIRE FRESH EXAMINATION AT THE END OF LD CIT(A). ACCORDI NGLY, WE SET ASIDE THE ORDER OF LD I.T.(SS)A. NO. 51/COCH/2008 & C.O. NO. 58/COCH/2008 4 CIT(A) IN RESPECT OF THE ISSUES CONTESTED BEFORE US BY BOTH THE PARTIES AND RESTORE ALL OF THEM TO HIS FILE WITH THE DIRECTION TO ADJUDICATE T HEM AFRESH AFTER AFFORDING NECESSARY OPPORTUNITY OF BEING HEARD TO THE PARTIES. 10. IN THE RESULT, THE APPEAL OF THE REVENUE AN D THE CROSS OBJECTIONS FILED BY THE ASSESSEE ARE TREATED AS ALLOWED FOR STATISTICAL PUR POSES. PRONOUNCED ACCORDINGLY ON -08-2012 (N.R.S.GANESAN) (B.R.BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE: KOCHI DATED: AUGUST, 2012 GJ COPY TO: 1. M/S. DORCI-CON, C/O SHRI V.H. YAHIA, VANIYAPARAM BIL, MAR ROAD, COCHIN-2. 2. THE ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE -1(2), ERNAKULAM 3. THE COMMISSIONER OF INCOME-TAX (APPEALS)-I, KOCH I. 4. THE COMMISSIONER OF INCOME-TAX, KOCHI. 5. D.R., I.T.A.T., COCHIN BENCH, COCHIN. 6. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR) ITAT, COCHIN