SMT. KASHMIRA MODI, MUMBAI V. INCOME TAX OFFICER-21(2)(1), MUMBAI

MA 502/MUM/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 5074 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 5 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 10-02-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2014-2015
• Appeal Filed On: 04-09-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KUMAR PADMA
• Keywords: Opportunity of being heard; Principle of natural justice; Set aside; Capital Gains

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH H MUMBAI BEFORE SHRI C.N. PRASAD (JUDICIAL MEMBER) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) M.A. NO. 502/MUM/2019 (ITA NO. 2107/MUM/2018) ASSESSMENT YEAR: 2014 - 15 SMT . KASHMIRA MODI, 1002 , SHEEL, MARIE CO - OP HOUSING SOCIETY LTD., ABDUL GAFFAR KHAN ROAD, WORLI, MUMBAI - 400018. VS. ITO 21(2)(1), PIRAMAL CHAMBERS, MUMBAI - 400012. PAN NO. AAFPM7124E APPELLANT RESPONDENT ASSESSEE BY : MR. BHUPENDRA SHAH, AR REVENUE BY : MR. KUMAR PADMAPANI BORA, DR DATE OF HEARING : 15/11/2019 DATE OF P RONOUNCEMENT : 10/02/2020 ORDER PER N.K. PRADHAN, A.M. BY MEANS OF THIS MISCELLANEOUS APPLICATION (MA), THE APPLICANT SEEKS CLARIFICATION ON THE ORDER DATED 12.04.2019 PASSED BY THE ITAT H BENCH MUMBAI (ITA NO. 2107/MUM/2018) FOR THE ASSESSMENT YEAR (AY) 2014 - 15. 2. BEFORE US, THE LD. COUNSEL SUBMITS THAT THE APPLICANT APPROACHED THE COMMISSIONER OF INCOME TAX (APPEALS) - 33, MUMBAI [IN SHORT CIT (A)] FOR GIVING EFFECT TO THE ORDER OF THE ITAT. HOWEVER, THE CIT(A) INFORMED THE APPLICANT THAT THE ORDER OF THE TRIBUNAL IS NOT CLEAR ON THE FOLLOWING POINTS : SMT KASHMIRA MODI MA NO. 502/MUM/2019 2 A) THERE IS NO DECISION ON GROUND NO. 1, 2, 3(A), 3(B), 3(C), 4, 5 RAISED BEFORE THE ITAT, B) THE RE IS NO DECISION ON ADDITIONAL GROUNDS NO. 8 AND 9 OF APPEAL RAISED BY THE APPELLANT BEFORE THE ITAT, C) THERE IS NO DIRECTION TO THE CIT(A) TO DECIDE THE WHOLE MATTER ON MERIT. THUS THE LD. COUNSEL SUBMITS THAT THE TRIBUNAL MAY CLARIFY THE ABOVE. 3. ON T HE OTHER HAND, THE LD. DEPARTMENTAL REPRESENTATIVE (DR) SUBMITS THAT THERE BEING NO MISTAKE APPARENT FROM RECORD, THE PRESENT MA BE DISMISSED. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIALS ON RECORD. IN THE IMPUGNED ORDER, WE HAVE MENTIONED AT PARA 3 THAT THE APPELLANT HAD RAISED ISSUES ON NATURAL JUSTICE IN THE 3 RD GROUND OF APPEAL. THE APPELLANT HAD STATED DURING THE COURSE OF HEARING ON 25.01.2019 THAT THE LD. CIT(A) ERRED IN CONFIRMING THE ASSESSMENT ORDER IN WHICH THE ASS ESSING OFFICER (AO) FOLLOWED THE DIRECTION OF THE JOINT COMMISSIONER OF INCOME TAX (JCIT) U/S 144A, WITHOUT PROVIDING OPPORTUNITY TO THE ASSESSEE TO REBUT THE DIRECTIONS OF THE JCIT U/S 144A. BEING AN ISSUE ON QUESTION OF NATURAL JUSTICE, WE ADVERTED TO TH E SAID GROUND OF APPEAL IMMEDIATELY. IN THE ORDER DATED 14.03.2018, THE LD. CIT(A) HAS MENTIONED AT PAGE 2 THE SAME GROUND OF APPEAL (AS 7 TH GROUND OF APPEAL) WHICH IS REPRODUCED BELOW: IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE AO HAS ER RED IN FOLLOWING DIRECTIONS OF JCIT U/S 144A AND ALSO NOT PROVIDING OPPORTUNITY TO THE APPELLANT TO REBUT THE DIRECTIONS OF JCIT U/S 144A. SMT KASHMIRA MODI MA NO. 502/MUM/2019 3 HOWEVER, WHILE PASSING THE ORDER, THE LD. CIT(A) HAS NOT ADJUDICATED THE ABOVE GROUND OF APPEAL. WE HAVE ALSO STATED IN THE IMPUGNED ORDER THAT SECTION 144A HAS BEEN INSERTED BY THE TAXATION LAWS (AMENDMENT) ACT, 1975 AND IT AUTHORIZES THE JCIT W.E.F. 01.10.1998 TO CALL FOR RECORDS OF A CASE EITHER ON HIS OWN MOTION OR ON A REFERENCE MADE BY THE AO OR AN APPLICATI ON MADE BY THE ASSESSEE, BEFORE THE ASSESSMENT IS FINALIZED, AND TO ISSUE SUCH DIRECTIONS AS HE CONSIDERS FIT IN THE CIRCUMSTANCES OF THE CASE FOR COMPLETION OF THE ASSESSMENT. OPPORTUNITY TO THE ASSESSEE IS TO BE PROVIDED FOR IF THE DIRECTIONS PROPOSED TO BE ISSUED ARE PREJUDICIAL TO HIM. IT HAS BEEN MADE CLEAR THAT THE DIRECTIONS WHICH MERELY LAY DOWN THE LINES ON WHICH AN INVESTIGATION IS TO BE MADE ARE NOT TO BE TREATED AS PREJUDICIAL TO THE ASSESSEE. SECTION 144A IS OPERATIVE W.E.F. 01.01.1976 . A PER USAL OF THE ORDER DATED 26.12.2016 PASSED BY THE JCIT BEING DIRECTION U/S 144A WITH REGARD TO THE REQUEST DATED 06.12.2016 SUBMITTED BY THE AO CLEARLY INDICATES THAT IT DEALS WITH THE FOLLOWING TWO ADDITIONS : 1) SHORT TERM CAPITAL GAIN OF RS.4,26,37,990/ - O N ACCOUNT OF TRANSFER OF RESIDENTIAL PROPERTY WHICH HAS UNDERGONE FOR RE - DEVELOPMENT FOR THE REASON THE ASSESSEE HAS HELD THIS FLAT FOR LESS THAN 36 MONTHS ; 2) TAXING OF AMOUNT OF RS.1,12,54,817/ - RECEIVED FROM THE DEVELOPER IN THE FORM OF CORPUS OF RS.1.12 CRORE OVER AND ABOVE THE NEW FLAT. IN THE ASSESSMENT ORDER DATED 28.12.2016, THE AO BROUGHT TO TAX THE SHORT TERM CAPITAL GAINS OF RS.4,26,37,991/ - . FURTHER IN THE ORDER DATED 14.03.2018, THE LD. CIT(A) MADE AN ENHANCEMENT OF RS.1,12,54,817/ - . SMT KASHMIRA MODI MA NO. 502/MUM/2019 4 THUS TH E ABOVE ADDITIONS FORM THE BEDROCK OF THE DIRECTION U/S 144A DATED 26.12.2016 PASSED BY THE JCIT. TO CLARIFY IT FURTHER, THE WHOLE MATTER IS TO BE DECIDED ON MERIT. IN VIEW OF THE ABOVE FACTS, WE THUS CLARIFY THAT WE SET ASIDE THE APPELLATE ORDER DATED 14.03.2018 PASSED BY THE LD. CIT(A) AND RESTORE THE MATTER TO HIM TO PASS A DE NOVO ORDER, AFTER GIVING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 5. IN THE RESULT, THE PRESENT MA IS ALLOWED WITH THE ABOVE CLARIFICATIONS. ORDER PRONOUNCED I N THE OPEN COURT ON 10/02/2020. S D/ - S D/ - ( C.N. PRASAD ) (N.K. PRADHAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED: 10/02/2 020 RAHUL SHARMA, SR. P.S. 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 . BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI