JAYESH D. GORAGANDHI, V. ITO WD 25(2)(1),

MA 264/MUM/2015

• Counselvise Citation: [2017] 124 COUNSELVISE.COM (IT) 5256 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 25 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 11-01-2017
• Appeal Filed By: Assessee
• Bench Allotted: J
• Assessment Year: 2003-2004
• Appeal Filed On: 16-11-2015
• Court: TRIBUNAL
• Department Lawyers: SAURABH DES
• Assessee Lawyers: RAJ KUMAR JAJAO
• Keywords: Business income

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL J BENCH, MUMBAI BEFORE SHRI JOGINDER SINGH , JUDICIAL MEMBER AND SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER M.A. NO. 264/M/2015 (ARISING OUT OF I.T.A. NO. 4835/M/2009 ) (AY: 2003 - 2004) SHRI JAYESH D. GORAGANDHI, PROP. M/S. D.G. BUILDER, A - 1, JAYESH APATS., CHANDAVARKAR LANE, BORIVALI (W), MUMBAI 400 092. / VS. ITO - 25(2)(1), MUMBAI 400 051. M.A. NO. 270/M/2015 (ARISING OUT OF I.T.A. NO. 4290/M/2009 (AY: 2003 - 2004) SHRI JAYESH D. GORAGANDHI, PROP. M/S. D.G. BUILDER, A - 1, JAYESH APATS., CHANDAVARKAR LANE, BORIVALI (W),MUMBAI 400 092. / VS. ITO - 25(2)(1), MUMBAI 400 051. ./ PAN : AAKPG 1389 C ( / APPELLANT) .. ( / RESPONDENT ) M.A. NO. 157/M/2016 (ARISING OUT OF I.T.A. NO. 5245/M/2007 (AY: 2003 - 2004) M/S. KRUPA BUILDERS, D - 4, JAY VIJAY, OFF. L.T.RD, BORIVALI (W), MUMBAI 400 092. / VS. ITO - 25(2)(1), MUMBAI 400 051. ./ PAN : AAEFK 2865 K ( / APPELLANT) .. ( / RESPONDENT ) / ASSESSEE BY : SHRI JITENDRA SINGH ; SHRI PRAKASH JHUNJHUNWALA & MR. RAJ KUMAR JAJAO / REVENUE BY : SHRI SAURABH DESPANDE, DR / DATE OF HEARING : 02.12.2016 / DATE OF PRONOUNCEMENT : 11 .01.2017 / O R D E R PER D. KARUNAKARA RAO, AM: THERE ARE THREE MISCELLANEOUS APPLICATIONS (MAS) UNDER CONSIDERATION. ALL THESE MAS ARE FILED BY T WO ASSESSEES FOR THE AY 2003 - 2004. THE PRESENT THREE MAS AROSE FROM THE COMPOSITE ORDER OF THE TRIBUNAL DATED 22.1.2014 IN ITA NOS. 4385 & 4290/M/2009 IN THE CASE OF SHRI JAYESH D. GORAGANDHI AND ITA NO.5245/M/2007 IN 2 THE CASE OF M/S. KRUPA BUILDERS. SINCE , THESE MAS ARE INTER - CONNECTED, THEREFORE, THEY ARE CLUBBED, H EARD COMBINEDLY AND DISPOSED OF IN THIS CONSOLIDATED ORDER. MA WISE ADJUDICATION IS GIVEN IN THE FOLLOWING PARAS OF THIS ORDER. I. MA NO.264/M/2015 2. THIS MA IS FILED BY THE ASSESSEE AND IT AROSE FROM THE ORDER OF THE TRIBUNAL IN ITA NO.4835/M/2009 IN THE CASE OF JAYESH D. GORAGANDHI . IN CONNECTION WITH THE MA, LD COUNSEL FOR THE ASSESSEE BROUGHT OUR ATTENTION TO PARA 16 OF OUR ORDER DATED 22.1.2014 (SUPRA) AND SUBMITTED THAT IN THE SENTENC E ..... REGARDING RECOGNIZING THE INCOME, THE ISSUE AGGRIEVED BY THE ASSESSEE IN THE APPEAL, WE FIND THE ASSESSEES HAVE NOT RECOGNIZED ANY INCOME EITHER IN AY 2003 - 04 OR IN AY 2004 - 05 AS THE ADVANCES RECEIVED ARE SHOWN AS LIABILITIES ONLY ...., THE WORDS EITHER AND OR IN AY 2004 - 05 ARE REQUIRED TO BE DELETED. ON EXAMINING THE DOCUMENTS WHICH ARE ORIGINALLY AVAILABLE ON THE RECORDS, WE FIND THE REQUEST OF THE ASSESSEE SHOU LD BE ALLOWED AND THE SAID LINE STAND S RECTIFIED. ACCORDINGLY, AO IS DIRECTED TO DELETE THE SAID WORDS AND FIGURES. 3. FURTHER, BRINGING OUR ATTENTION TO THE CONTENTS OF OUR ORDER ON PAGE 5, LD COUNSEL FOR THE ASSESSEE SUBMITTED THAT THERE IS NEED FOR OTHER RECTIFICATION WITH REGARD TO THE CONCLUSIONS ON SALE OF FSI AND TDRS. IT IS TH E ARGUMENT OF THE LD COUNSEL FOR THE ASSESSEE THAT THE SALE PROCEEDS, IF ANY, IN THIS REGARD ARE REQUIRED TO BE TAXED IN AY 2004 - 05 NOT IN AY 2003 - 04. AFTER HEARING BOTH THE PARTIES ON THIS ISSUE, WE FIND, THIS ISSUE HAS ATTRACTED DETAILED DISCUSSION IN P ARA 3 AND ITS SUB - PARAS AND THE TRIB UNAL HAS COME TO THE CONCLUSION CONFIRMING THE ORDER OF THE CIT (A) FOR A DETAILED REASONING GIVEN IN PARAS 7 TO 16 OF THE SAID TRIBUNALS ORD ER (SUPRA). THERE IS A SPECIFIC REFERENCE MADE IN PARAS 3 AND 4 OF THE TRIBUN ALS ORDER AND THE ARGUMENT OF THE LD AR WAS OBVIOUSLY CONSIDERED AS EVIDENT FROM PARA 3. THE FOLLOWING LINES FROM THE SAID PARA 3.2 SUPPORTS THE ABOVE IE ........ AFTER DISCUSSING THE FACTS, CIT (A) DIRECTED THE AO TO TAX THE BUSINESS INCOME FROM SALE OF CLEAR FSI AND TDR DURING THE PERIOD RELEVANT TO THE AY 2003 - 2004 INSTEAD OF AY 2004 - 2005 AS OFFERED BY THE ASSESSEE . IN OUR ORDER DATED 22.1.2014, WE HAVE HELD THAT THE IMPOUNDED PAPERS SHOULD BE READ AS A WHOLE AND THE ONUS IS ON THE ASSESSEE QUA THE D ETAILS ON THE IMPOUNDED / INCRIMINATING PAPERS ETC . T HE CONTENTS OF PARA 7 TO 3 16 OF THE SAID TRIBUNALS ORDER (SUPRA) ARE RELEVANT IN THIS REGARD. CONSIDERING THE DETAILED DISCUSSION GIVEN ON THIS ISSUE, REJECTING THE ASSESSEES CONTENTION ABOUT THE TAXA BILITY OF THE SAME IN THE AY 2003 - 2004, WE ARE OF THE OPINION, THERE IS NO MISTAKE APPARENT FROM THE RECORDS WITHIN THE MEANING OF SECTION 254(2) OF THE ACT. ACCORDINGLY, THIS PART OF THE SUBMISSIONS OF THE ASSESSEE RAISED IN THE MA STAND DISMISSED. 4. IN THE RESULT, MA FILED BY THE ASSESSEE IS PARTLY ALLOWED . II. M.A. NO. 270/M/2015 5. THIS MA IS FILED BY THE ASSESSEE IN CONNECTION WITH THE REVENUES APPEAL ITA NO.4290/M/2009 IN THE CASE OF SHRI JAYESH D GORAGANDHI. IN THE MA, ASSESSEE DESIRES THAT THE CONTENTS ON THE INCRIMINATING DOCUMENTS IMPOUNDED DURING THE SURVEY ACTION ARE IN VARIANCE WITH THAT OF THE REGISTERED DOCUMENTS. DURING THE APPEAL PROCEEDINGS BEFORE THE TRIBUNAL, IT WAS THE ARGUMENT OF THE LD COUNSEL FOR THE ASSESSEE THAT WHEN THERE IS A VARIANCE, THE SAID DOCUMENTS SHOULD NOT BE TAKEN IN CONSIDERATION. WE HAVE DISMISSED THE SAID ARGUMENT OF THE LD AR FOR THE REASONS GIVEN IN PARAS 7 TO 16 OF THE SAID TRIBUNALS ORDER (SUPRA). THERE IS A SPECIFIC REFERENCE TO SUCH ARGUMENTS AND THE CON TENTS OF PARA 11 OF THE TRIBUNALS ORDER (SUPRA) ARE RELEVANT IN THIS REGARD. CONSIDERING THE SAME, WE ARE OF THE OPINION, THIS PART OF THE MA SHOULD BE DISMISSED. WE ORDER ACCORDINGLY. 6. ASSESSEE ALSO RAISED ANOTHER ISSUE REGARDING THE TAXING OF THE CS H PORTION OF THE PAYMENT IN THE AYS 2003 - 04 AND 2004 - 05 IN THE RATIO OF 20% AND 25% . IN OUR ORDER, IT IS HELD THAT THE ENTIRE AMOUNT OF RS. 1,22,95,000/ - SHOULD BE TAXED IN THE AY 2003 - 2004. WE HAVE DISMISSED THESE ARGUMENTS AS THE ASSESSEE FAILED TO DEM ONSTRATE THE SAME WITH EVIDENCE. WE HAVE TAKEN THIS VIEW AFTER DUE DELIBERATIONS . IN OUR OPINION, THE REVISION OF SUCH VIEW IS OUTSIDE THE SCOPE OF PROVISIONS OF SECTION 254(2) OF THE ACT. ACCORDINGLY, THIS PART OF THE OBJECTION IS DISMISSED. WE OR DER ACCORDINGLY. 7. ANOTHER ASPECT OF THE MA RELATES TO THE EXPRESS DENIAL BY THE PARTIES REGARDING THE CONTENTS ON THE INCRIMINATING PAPERS RELATING TO THE PAYMENT OF CASH OUTSIDE BOOKS . DURING SURVEY / SEARCH PROCEEDINGS, WHEN SOME INCRIMINATING 4 INFORMA TION OR DATA ARE UNEARTHED BY THE REVENUE TEAM, THE ASSESSEE OFTEN DENY IN A ROUTINE MANNER. SUCH DENIALS ARE IGNORED CONSIDERING THE ONUS RELATED GROUNDS. THERE IS A PROCEDURE IN THE M ATTERS OF SURVEY OPERATIONS SUCH DENIAL, IF ANY, IS NORMALLY IGNORED BY THE REVENUE FOR WANT OF EVIDENCE AS THE ONUS IS ON THE ASSESSEE . IN SUPPORT OF THE ASSESSEES MA ON THIS ISSUE, LD COUNSEL FOR THE ASSESSEE BROUGHT OUR ATTENTION TO QUESTIONS AND ANSWERS OF A STATEMENT RECORDED DURING THE SURVEY ACTION. IT IS IN THIS SENSE OF THE ISSUE, THE TRIBUNAL HAS GIVEN A CATEGORICAL FINDING THAT THE ASSESSEE HAS NOT EXPRESSLY DENIED THE GENUINENESS OF THE CONTENTS ON THE INCRIMINATING PAPERS. IN OUR OPINION, THIS IS THE CASE WHERE THE ASSESSEE FAILED TO DISCHARGE THE ONUS AND T HEREFORE, THE ARGUMENTS OF THE ASSESSEE IN MA, IN ANY WAY, WILL NOT ALTER THE CONCLUSIONS DRAWN BY US IN THE ORDER WITH REGARD TO THE CONTENTS ON THE SAID INCRIMINATING PAPERS. IT IS THE FINDING OF THE TRIBUNAL THAT THE INCRIMINATING PAPERS, WHICH ARE THE BASIS FOR CO NFIRMING THE ADDITIONS , WERE NOT DUM DOCUMENTS AS PROPOSED BY THE ASSESSEE. ACCORDINGLY, THIS PART OF THE ARGUMENTS IS DISMISSED. 8. THE OTHER ISSUES RAISED IN THE MA RELATE TO NON - CONSIDERATION OF CERTAIN ARGUMENTS WHILE DECIDING THE ISSUE. ON PERUSAL OF THE RECORDS, WE FIND, THERE IS NO EVIDENCE TO SUPPORT THE ASSESSEES CASE. NON - CONSIDERATION OF AN ARGUMENT DOES NOT CONSTITUTE A MISTAKE APPARENT FROM RECORD. ACCORDINGLY THE AO IS ORDERED. 9. IN THE RESULT, MA FILED BY THE ASSESSEE IN THE CASE OF THE REVENUES APPEAL IS DISMISSED. III. M.A. NO. 157/M/2016 10. THIS MA IS FILED BY THE ASSESSEE AND IT AROSE FROM THE REVENUES APPEAL ITA NO.5245/M/2007 IN THE CASE OF M/S. KRUPA BUILDERS. 11. BEFORE US, AT THE OUTSET, LD COUNSEL FOR THE ASSESSEE BROUGHT OUR ATTENTION TO THE 4 TH LINE ON PAGE 1 OF THE TRIBUNALS ORDER DATED 22.1.2014 AND SUBMITTED THAT IT IS ERRONEOUSLY MENTIONED AS APPEAL ITA NO.5245/M/2007 IS FILED BY M/S. KRUPA BUILDERS. IN FACT, THE SAID APPEAL (ITA NO.5245/M/2007) IS FILED BY THE REVENUE IN THE CASE OF M/S. KRUPA BUILDERS. ON PERUSAL OF THE RECORD, WE FIND THE SAID 5 INADVERTENT TYPOGRAPHICAL MISTAKE IS REQUIRED TO BE RECTIFIED. WE ORDER ACCORDINGLY AND THE SAID MISTAKE STANDS RECTIFIED. 12. FURTHER, LD COUNSEL FOR THE ASS ESSEE SUBMITTED THAT THE ASSESSEE IS AGGRIEVED ON FINDING OF THE TRIBUNAL THAT THE CONTENTS OF THE INCRIMINATING DOCUMENTS WERE NOT EXPRESSLY DENIED BY THE ASSESSEE. DRAWING OUR ATTENTION TO QUESTION NO.21 ON PAGE 35 OF THE PAPER BOOK, LD COUNSEL FOR THE ASSESSEE MENTIONED THAT THE ANSWER TO THIS QUESTION SUGGESTS THE DENIAL OF THE CONTENTS OF THE SAME. ON HEARING BOTH THE PARTIES ON THIS ISSUE, WE FIND, THIS ISSUE IS IDENTICAL TO THAT OF THE ISSUE NO.3 RAISED FOR RECTIFICATION BY SHRI JAYESH D. GORAGANDH I IN CONNECTION WITH APPEAL ITA NO.4290/M/2009 (REVENUES APPEAL). WE HAVE DISMISSED THE SAID ARGUMENTS WHILE DEALING WITH THE SAID ISSUE IN MA NO.270/M/2015, WHICH IS ADJUDICATED IN THE ABOVE PARAS OF THIS ORDER. FOR THE IDENTICAL REASONS, THIS PART OF THE MA IS DISMISSED. 13. IN THE RESULT, MA FILED BY THE ASSESSEE IS PARTLY ALLOWED . 14. CONCLUSIVELY, MA NO.270/M/2015 IS DISMISSED AND THE OTHER TWO MAS FILED BY THE ASSESSEE ARE PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 11 TH OF JANUARY, 2017. SD/ - SD/ - (JOGINDER SINGH) (D. KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; 11 .01.2017 . . ./ OKK , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . 6 //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI