M/s. THAKKAR FAMILY TRUST, MUMBAI v. ITO - 12(3)(2), MUMBAI

CO 100/MUM/2006 | misc
Pronouncement Date: 21-05-2010 | Result: Partly Allowed

Appeal Details

RSA Number 10019923 RSA 2006
Assessee PAN AAAAT4076G
Bench Mumbai
Appeal Number CO 100/MUM/2006
Duration Of Justice 4 year(s) 1 month(s) 30 day(s)
Appellant M/s. THAKKAR FAMILY TRUST, MUMBAI
Respondent ITO - 12(3)(2), MUMBAI
Appeal Type Cross Objection
Pronouncement Date 21-05-2010
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted J
Tribunal Order Date 21-05-2010
Date Of Final Hearing 10-03-2010
Next Hearing Date 10-03-2010
Assessment Year misc
Appeal Filed On 22-03-2006
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH J : MUMBAI BEFORE SHRI D.K. AGARWAL (JM) AND SHRI B. RAMAKOT AIAH (AM) C.O. NO.100/MUM/2006 ARISING OUT OF ITA NO.6142/MUM/2005 (ASSESSMENT YEAR :1989-90) M/S. THAKKAR FAMILY TRUST L/H YASMIN B. THACKER 517 MAKER CHAMBERS VI NARIMAN POINT MUMBAI-400 021. ..( CROSS OBJECTOR ) P.A. NO. (AAAAT 4076 G) VS. INCOME TAX OFFICER WARD 12(3)(2) ROOM NO.102 AAYAKAR BHAVAN M.K. MARG MUMBAI-400 020. ( APPELLANT IN APPEAL ) ITA NO.3680/MUM/2008 ASSESSMENT YEAR : 1989-90 INCOME TAX OFFICER WARD 12(3)(2) MUMBAI-400 020. ( APPELLANT ) VS. M/S. THAKKAR FAMILY TRUST L/H YASMIN B. THACKER MUMBAI-400 021. ..( RESPONDENT ) ASSESSEE BY : SHRI VIJAY MEHTA DEPARTMENT BY : SHRI S.M . KESHKAMAT O R D E R PER D.K. AGARWAL (JM). THE CROSS OBJECTION FILED BY THE ASSESSEE ARISES AS A RESULT O F ORDER PASSED BY THE TRIBUNAL IN M.A. NO.30/MUM/2009 A RISING OUT OF C.O. NO.100/MUM/2006 IN ITA NO.6142/M/05 FOR THE ASSESSMENT YEAR 1989-90 ORDER DATED 23.3.2009 WHEREIN THE TRIBUNAL HAS RECALLED ITS ITA NO.3680/MUM/2008& C.O.100/06 A.Y:89-90 2 ORDER DATED 29.9.2008 FOR LIMITED PURPOSE OF DISPOSING OF GROUND NO.6 TAKEN BY THE ASSESSEE IN ITS C.O. THE APPEAL IN ITA NO. 3680/M/2008 PREFERRED BY THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 26.3.2008 PASSED BY THE LD. CIT(A) FOR THE ASSESSMENT YEAR 1989-90. SINCE FACTS ARE IDENTICAL AND ISSUES INVOLVED ARE INTERCONNECTED THE ASSESSEE'S C.O. AND REVENUES APPEAL ARE DISPOSED OF BY THI S COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE ASSESSEE A FAMILY TRUST HAD PURCHASED BUNGALOW IN AN INCOME-TAX AUCTION A T ROOP LEELA JUHU TARA ROAD BOMBAY FOR RS.1 11 50 000/-. IT HAD ALSO PURCHASED ANOTHER BUNGLOW ON 6.4.1988 IN JUHU VILLAGE BOMBAY. WHILE VERIFYING THE SOURCE OF FUNDS FOR THESE TRANSACTION S ASSESSING OFFICER FOUND CERTAIN CREDITS AND DEPOSITS IN ITS BANK ACCO UNTS FOR THE PREVIOUS YEAR RELEVANT TO ASSESSMENT YEAR 1988-89 ONWARD S WHICH NEEDED FURTHER EXPLANATION. SINCE IT WAS NOT FILING A TAX RETURN NOTICE U/S.148 OF THE INCOME TAX ACT 1961 (THE ACT) WAS ISSUED. IN RESPONSE THE ASSESSEE FILED RETURN DECLARING INCOME OF RS. 2 41 459/-. HOWEVER THE ASSESSMENT WAS COMPLETED AT AN INCOME OF RS.1 54 87 400/- INCLUDING THE UNEXPLAINED INVESTMENT IN THE CAR RS.12 58 541/- VIDE ORDER DATED 24.3.1992 PASSED U/S.1 43(3) R.W.S.147 OF THE ACT. ON APPEAL THE LD. CIT(A) VIDE ORDER DATED 19.1.1996 WHILE CONFIRMING THE ADDITIONS MADE BY THE ASSESSING ITA NO.3680/MUM/2008& C.O.100/06 A.Y:89-90 3 OFFICER DISMISSED THE ASSESSEE'S APPEAL. ON FURTHER APPEA L TO THE TRIBUNAL THE TRIBUNAL IN ASSESSEE'S APPEAL IN ITA NO .7077 & 7088/MUM/98 FOR ASSESSMENT YEARS 1989-90 AND 1988-89 VID E ORDER DATED 6.2.2004 WHILE PARTLY ALLOWING THE APPEAL SET ASIDE THE IMPUGNED ISSUE TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO VERIFY AND IF THE AMOUNT OF RS.15.00 LACS HAS BEEN RECE IVED BY THE ASSESSEE FROM ASSESSEE'S CAR PURCHASER BEFORE ASSESSEE PURCHASED THE CAR AND IF SO THEN TO DELETE THIS ADDITION AND IN AN OTHERWISE POSITION THIS ADDITION SHALL STAND. PURSUANT TO THE ORDER OF TH E TRIBUNAL THE ASSESSING OFFICER IN THE ABSENCE OF ANY EVIDENCE FURNISHED B Y THE ASSESSEE IN SUPPORT OF ITS CLAIM ONCE AGAIN MADE THE ADDITI ON ON ACCOUNT OF UNEXPLAINED INVESTMENT IN THE CAR RS.12 58 54 1/-. THE ASSESSING OFFICER AFTER MAKING SOME OTHER ADDITIONS COMPLET ED THE ASSESSMENT AT AN INCOME OF RS.1 54 67 390/- VIDE ORDER DA TED 29.3.2005 PASSED U/S.143(3) R.W.S. 254 OF THE ACT. ON A PPEAL THE LD. CIT(A) WHILE GIVING SUBSTANTIAL RELIEF TO THE ASSESSEE CO NFIRMED THE ADDITION OF RS.12 58 541/- ON THE GROUND THAT THE ASSE SSEE HAS FAILED TO PROVE THE SOURCE OF INVESTMENT IN THE CAR VIDE ORDE R DATED 29.7.2005. ON FURTHER APPEAL TO THE TRIBUNAL BY TH E ASSESSEE AND THE REVENUE THE TRIBUNAL IN ITA NO.6141 & 6142/M/05 AN D C.O. NO.99 & 100 M/2006 FOR THE ASSESSMENT YEARS 1988-89 AND 1989-90 VIDE ORDER DATED 29.9.2008 WHILE UPHOLDING THE ORDER OF THE LD. CIT(A) ITA NO.3680/MUM/2008& C.O.100/06 A.Y:89-90 4 DISMISSED THE ASSESSEES AND REVENUES APPEALS AND ASSESSEE'S C.O . THEREAFTER THE TRIBUNAL VIDE ITS ORDER IN M.A NO.30/ M/2009 SUPRA RECALLED ITS ORDER FOR LIMITED PURPOSE TO DECIDE GROUND NO.6 OF THE ASSESSEE'S C.O. WHICH READS AS UNDER :- ON THE FACTS AND CIRCUMSTANCES OF THE CASE LD. INCOME TAX OFFICER 12(3)(2) MUMBAI (ITO) ERRED IN CONFIRMING THE ADDITION MADE BY ASSESSING OFFICER U/S.69C AMOUNTING TO RS.12 58 541/- IN RESPECT OF PURCHASE OF CAR BY TREATING IT AS UNEXPLAINED INVES TMENT. 3. AT THE TIME OF HEARING THE LD. COUNSEL FOR THE A SSESSEE AFTER GIVING BRIEF FACTS/HISTORY OF THE CASE MADE A REQUEST TO THE TRIBUNAL TO ADMIT ADDITIONAL EVIDENCE CONTAINING CONFIRMATION LETT ER OF THE PURCHASER OF THE CAR P.A. NO. OF THE CONCERNED DIRECTOR ASSESSEE'S LETTERS DATED 22.7.2009 AND 9.7.2009 AND COPY OF CAR R EGISTRATION PAPERS. AT THIS STAGE THE LD. COUNSEL FOR THE ASSESSEE DR AWS OUR ATTENTION TO PART OF PARA (J) APPEARING AT INTERNA L PAGE-9 (PAGE 118 OF ASSESSEE'S PAPER BOOK) OF THE ORDER OF THE LD. CIT(A) DA TED 29.7.2005 WHEREIN IT HAS BEEN MENTIONED THAT SHE (MRS. YASMIN T HAKKAR) HERSELF AND HER HUSBAND MR. BHARAT THACKER WERE COMPLE TELY ABSOLVED FROM THE ALLEGATIONS UNDER COFEPOSA AND THE ORDER U NDER FERA DATED 28.9.99 AND 11.3.2002 WERE ALSO REVOKED AS THERE WAS N O CONNECTION FOUND (AS THERE WAS NONE) WITH ACTIVITIES OF SHRI HANSRA J THACKER WHO IS NOW DECEASED. ASPERSIONS CAST BY ASSESSING OFFICER ABOUT COFEPOSA & FERA INVOLVEMENTS HAVE BEEN ALSO CLEARLY RE FUTED ITA NO.3680/MUM/2008& C.O.100/06 A.Y:89-90 5 DELINKING OUR ACTIVITIES WITH THOSE OF HANSRAJ THAKKAR. HANSRAJ THAKKAR WAS DETAINED AND ARRESTED FOR 18 MONTHS. WHILE INVESTIG ATIONS WERE CARRIED OUT HIS BUSINESSES AND ACCOUNTS WERE FROZEN. HIS PASSP ORT WAS TAKEN AWAY. IN THIS STATE HE PASSED AWAY. HER HUSBAND AND SHE HAD BEEN OUT OF INDIA MUCH PRIOR TO THIS INVESTIGATION AN D DID NOT RETURN FOR YEARS THEREAFTER. HER HUSBAND BHARAT THAKAR FINA LLY PASSED AWAY IN SINGAPORE. HE FURTHER SUBMITS THAT IN VIEW OF THE ABOVE REASONS THE ASSESSEE AFTER MUCH PERSUASION COULD OBTAIN THE CONFIRMA TION LETTER FROM THE PURCHASER WHO PURCHASED THE CAR FROM THE ASSESSEE AFTER MAKING ADVANCE PAYMENT SUPPORTED BY CAR REGISTRAT ION PAPERS THEREFORE THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE I N NOT FILING THE ABOVE DOCUMENTARY EVIDENCE EITHER BEFORE THE ASSESSIN G OFFICER OR BEFORE THE LD. CIT(A) OR BEFORE THE TRIBUNAL IN PR IOR PROCEEDINGS . HE THEREFORE SUBMITS THAT IN THE INTEREST OF JUSTICE THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE BE ADMITTED AND HE HAS NO OBJECTION IF THE ISSUE IS AGAIN RESTORED BACK TO THE FILE OF THE ASSESSI NG OFFICER FOR HIS EXAMINATION. AT THIS STAGE HE ALSO SUBMITS THAT THE A SSESSEE WILL GIVE FULL COOPERATION TO THE ASSESSING OFFICER IN THIS RE GARD. 4. ON THE OTHER HAND THE LD. DR WHILE STRONGLY OPPOSI NG THE ADMISSION OF ADDITIONAL EVIDENCE SUBMITS THAT DESPITE GI VING VARIOUS OPPORTUNITIES TO THE ASSESSEE THE ASSESSEE HAS FAILED TO FIL E DOCUMENTARY EVIDENCE TO PROVE THE SOURCE OF INVESTMENT I N THE CAR ITA NO.3680/MUM/2008& C.O.100/06 A.Y:89-90 6 THEREFORE THE LD. CIT(A) WAS FULLY JUSTIFIED IN CONF IRMING THE ADDITION MADE BY THE ASSESSING OFFICER IN THIS REGARD AND HIS ORDE R BE UPHELD. 5. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE RI VAL PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE FACTS ARE NOT IN DISPUTE INASMUCH AS IT IS NOT THE CASE OF THE REVENUE THAT THE ASSESSEE HAS NOT COOPERATED AT ANY STAGE. WE FURTHER FIND THAT IT IS ALSO NOT IN DISPUTE THAT THE ASSESSEE IS CONSISTENTLY CONTEN DING THAT THE CAR WAS PURCHASED OUT OF THE ADVANCE RECEIVED FROM T HE PURCHASER OF THE CAR. WE ALSO FIND MERIT IN THE PLEA OF THE LD . COUNSEL FOR THE ASSESSEE THAT DUE TO EXCEPTIONAL CIRCUMSTANCES BEYOND THE CONT ROL OF THE ASSESSEE AS MENTIONED ABOVE THE ASSESSEE WAS PREVENTED BY REASONABLE CAUSE IN NOT FILING THE SUPPORTING MATERIAL TO PROVE THE SOURCE OF INVESTMENT IN THE CAR THAT THE CAR WAS PURCHASED OUT OF THE ADVANCE RECEIVED FROM THE PURCHASER. SINCE THE ADDITION AL EVIDENCE NOW PLACED ON RECORD BY THE ASSESSEE GOES TO THE ROOT OF T HE MATTER AND THE SAME WAS NOT MADE AVAILABLE TO THE ASSESSING OFF ICER THEREFORE WE ARE OF THE VIEW THAT IN THE INTEREST O F JUSTICE THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE AT THIS STAGE SHO ULD BE ADMITTED AND ACCORDINGLY WE AFTER ADMITTING THE SAME CO NSIDER IT FAIR AND REASONABLE THAT THE MATTER SHOULD GO BACK TO THE F ILE OF THE ASSESSING OFFICER AND ACCORDINGLY WE SET ASIDE THE ORDER PASSE D BY THE REVENUE AUTHORITIES ON THIS ACCOUNT AND SEND BACK THE M ATTER TO THE ITA NO.3680/MUM/2008& C.O.100/06 A.Y:89-90 7 FILE OF THE ASSESSING OFFICER WHO SHALL DECIDE THE SAME AF RESH AFTER CONSIDERING ALL MATERIAL EVIDENCE WHICH THE ASSESSEE MAY LI KE TO FILE AND ACCORDING TO LAW AFTER PROVIDING REASONABLE OPPORT UNITY OF BEING HEARD TO THE ASSESSEE. THE GROUND TAKEN BY THE ASSESSEE I S THEREFORE PARTLY ALLOWED FOR STATISTICAL PURPOSES. ITA NO. 3680/M/2008 (A.Y.1989-90) (REVENUES APPEA L):- 6. IN THIS APPEAL THE ASSESSING OFFICER ON THE ADDITION OF RS.15.00 LACS IN RESPECT OF PURCHASE OF CAR AND ITS SALE HAS IMPOSED PE NALTY AMOUNTING TO RS.7 87 500/- VIDE ORDER DATED 30.3.200 7 PASSED U/S.271(1)(C) OF THE ACT. ON APPEAL THE LD. CIT(A) W HILE OBSERVING THAT THE APPELLANT HAD DISCLOSED THE ENTIRE TRANSACTION S IN ITS RETURN DELETED THE PENALTY IMPOSED BY THE ASSESSING OFFICER. 7. BEING AGGRIEVED BY THE ORDER OF THE LD. CIT(A) T HE REVENUE IS IN APPEAL BEFORE US TAKING FOLLOWING GROUNDS OF APPEAL:- 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) HAS ERRED IN DELETI NG THE PENALTY LEVIED U/S.271(1)(C) OF THE INCOME TAX ACT 1961 AMOUNTING TO RS.7 87 500/- IGNORING THE FACT THAT T HE CIT(A) HAD HIMSELF CONFIRMED THE QUANTUM APPEAL TO THE EXTENT OF RS.15 00 000/- BEING UNEXPLAINED INVESTME NT IN MOTOR CAR AND PROFIT ON SALE OF CAR. 2. WHILE DOING SO THE LD. CIT(A) HAS IGNORED HIS OWN FINDING IN THE QUANTUM APPEAL THAT NO MATER IAL HAS BEEN BROUGHT ON RECORD BY THE ASSESSEE TO PROVE THAT HE HAD RECEIVED RS.15 LACS FROM THE PURCHASER BEFOR E THE PURCHASE OF CAR. HIS OWN FINDING THAT THE SOURCE OF ITA NO.3680/MUM/2008& C.O.100/06 A.Y:89-90 8 INVESTMENT OF RS.15 LACS IN THE CAR IS NOT PROVED A T ALL HAS BEEN IGNORED BY THE CIT(A). 8. AFTER HEARING THE RIVAL PARTIES AND PERUSING THE M ATERIAL AVAILABLE ON RECORD AND KEEPING IN VIEW OF O UR FINDING RECORDED IN PARA - 5 OF THIS ORDER WE ARE OF THE VIEW THAT SINCE IN THE QUANTUM PROCEEDING WE HAVE RESTORED BACK THE MATTER TO THE FIL E OF THE ASSESSING OFFICER THEREFORE IN THE INTEREST OF JUSTICE W E CONSIDER IT FAIR AND REASONABLE THAT THE IMPUGNED MATTER OF PENALTY SH OULD ALSO GO BACK TO THE FILE OF THE ASSESSING OFFICER AND ACCORDINGLY W E SET ASIDE THE ORDERS PASSED BY THE REVENUE AUTHORITIES ON THIS ACCO UNT AND SEND BACK THE MATTER TO THE FILE OF THE ASSESSING OFFICER WHO SHALL DECIDE THE SAME AFRESH IN THE LIGHT OF OUR OBSERVATION HEREIN ABOVE AND ACCORDING TO LAW AFTER PROVIDING REASONABLE OPPORTUNIT Y OF BEING HEARD TO THE ASSESSEE. THE GROUNDS TAKEN BY THE REVENUE ARE TH EREFORE PARTLY ALLOWED FOR STATISTICAL PURPOSES. 9. IN THE RESULT THE ASSESSEE'S C.O. AND REVENUES APPEAL STAND PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 21.5.2010. SD/- SD/- (B. RAMAKOTAIAH) ( D.K. AGARWAL ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI DATED: 21.5.2010. JV. ITA NO.3680/MUM/2008& C.O.100/06 A.Y:89-90 9 COPY TO: THE APPELLANT THE RESPONDENT THE CIT CONCERNED MUMBAI THE CIT(A) CONCERNED MUMBAI THE DR BENCH TRUE COPY BY ORDER DY/ASSTT. REGISTRAR ITAT MUMBAI. DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 13.5.10 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 14.5.10 SR.PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6. KEPT FOR PRONOUNCEMENT ON 21.5.10 SR.PS/PS 7. FILE SENT TO THE BENCH CLERK 24.5.10 SR.PS/PS 8 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER