Utsav Parekh, Kolkata v. ACIT, CIR-31, KOLKATA, Kolkata

ITA 1093/KOL/2016 | 2006-2007
Pronouncement Date: 07-10-2016

Appeal Details

RSA Number 109323514 RSA 2016
Assessee PAN AGHPP4467H
Bench Kolkata
Appeal Number ITA 1093/KOL/2016
Duration Of Justice 4 month(s) 19 day(s)
Appellant Utsav Parekh, Kolkata
Respondent ACIT, CIR-31, KOLKATA, Kolkata
Appeal Type Income Tax Appeal
Pronouncement Date 07-10-2016
Appeal Filed By Assessee
Bench Allotted SMC
Tribunal Order Date 07-10-2016
Assessment Year 2006-2007
Appeal Filed On 19-05-2016
Judgment Text
I.T.A. NO. 1093/KOL./2016 ASSESSMENT YEAR: 2006-2007 PAGE 1 OF 7 IN THE INCOME TAX APPELLATE TRIBUNAL B BENC H KOLKATA BEFORE SHRI K. NARASIMHA CHARY JM & DR. ARJUN LA L SAINI AM ./ ITA NO.1093/KOL/2016 ( / ASSESSMENT YEAR :2006-2007) UTSAV PAREKH 2/3 SARAT BOSE ROAD KOLKATA-700020 VS. ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE-31 KOLKATA 10 MIDDLETOWN ROW KOLKATA ./ ./PAN/GIR NO. : AGHPP 4467 H ( /APPELLANT ) .. ( / RESPONDENT ) /ASSESSEE BY : S/SHRI ANKIT JALAN & K.K.GOSW AMI A.R. /REVENUE BY : SHRI RAJAT KUMAR KUREEL JCIT D.R . / DATE OF HEARING : 03/10/2016 /DATE OF PRONOUNCEMENT 07/10/2016 / O R D E R PER SHRI K. NARASIMHA CHARY J.M.: THIS IS AN APPEAL BY ASSESSEE CHALLENGING THE ORDER DATED 30-3-2016 IN APPEAL NO.373/CIT(A)-9/CIR-31/2014-15/KOL PASSE D BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-9 KOLKATA [HE REINAFTER CALLED AS CIT(A)] WHILE DISMISSING THE APPEAL CONFIRMED TH E ADDITIONS MADE BY THE ASSESSING OFFICER (HEREINAFTER CALLED AS AO). I.T.A. NO. 1093/KOL./2016 ASSESSMENT YEAR: 2006-2007 PAGE 2 OF 7 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE I S AN INDIVIDUAL. HE FILED THE RETURN OF INCOME ON 26-10-2006 FOR THE ASSESSMENT Y EAR 2006-07 DECLARING NET TAXABLE INCOME OF RS.13 01 840/-. ASSESSMENT U/ S.143(3) WAS COMPLETED BY 29-3-2008. HOWEVER NOTICES U/S.148 143(2) AND 142(1) WERE ISSUED ON 28-3-2013 19-9-2013 AND 21-11-2013 RESPECTIVELY AN D THE ASSESSEE FURNISHED ALL THE DETAILS AS REQUIRED BY THE AO. TH E AO OBSERVED THAT THE JEWLLERY AND ORNAMENTS WERE VALUED AT RS.41 14 623/ - IN THE WEALTH TAX RETURN WHEREAS IN THE INCOME TAX RETURN IT WAS SHOWN AS ON LY RS.27 59 915/- AT PURCHASE PRICE. ASSESSEE SUBMITTED THAT HE ADOPTED FAIR MARKET VALUE FOR THE PURPOSE OF WEALTH TAX RETURN WHEREAS THE HISTORICAL COST FOR INCOME TAX PURPOSE AND BOTH ARE NOT COMPARABLE SO AS TO MAKE ANY ADDITION. HOWEVER THE AO NOT BEING SATISFIED WITH THE SAME BY WAY OF ORDER DATED 31-1-2014 THE LD. AO DETERMINED THE INCOME OF THE ASSESSEE AS RS.43 52 618/- AND MADE ADDITION OF RS.13 44 708/- TOWARDS THE VALUE O F JEWELLERY AND ORNAMENTS UNDERVALUED IN THE BOOKS OF THE ASSESSEE. LD. AO OB SERVED THAT THE ASSESSEE COULD NOT PRODUCE THE VALUATION REPORT OF THE APPRO VED JEWELLER AND NO ANY DETAILS OF THE JEWELLERY AND ORNAMENTS ARE FURNISHE D AS SUCH. 3. AGGRIEVED BY THE ADDITION THE ASSESSEE CARRIED T HE MATTER IN APPEAL TO LD. CIT(A). LD. CIT(A) OBSERVED THAT THE ASSESSEE W AS NON-COOPERATIVE AND THERE WAS NO APPEARANCE ON BEHALF OF THE ASSESSEE. THOUGH THERE WAS APPEARANCE ON 04.11.2015 SUBSEQUENT TO THE RECEIPT OF REMAND REPORT NONE APPEARED HENCE HOLDING THAT THERE WAS NO NEW FACT OR DETAILS AVAILABLE FOR CONSIDERATION HE CONFIRMED THE ORDER OF THE AO. I.T.A. NO. 1093/KOL./2016 ASSESSMENT YEAR: 2006-2007 PAGE 3 OF 7 4. AGGRIEVED BY THE IMPUGNED ORDER THE ASSESSEE CA ME IN APPEAL BEFORE US ON THE FOLLOWING GROUNDS :- 1. FOR THAT UNDER THE FACTS AND CIRCUMSTANCES OF T HE CASE THE ORDER PASSED BY LD. CIT(APPEALS) IS WRONG BAD IN LAW AND UNJUSTI FIED AND SHOULD BE DELETED REVERSED OR MODIFIED. 2. FOR THAT UNDER THE FACTS AND CIRCUMSTANCES OF T HE CASE THE LD. CIT(APPEALS) WAS GROSSLY WRONG AND UNJUSTIFIED IN C ONFIRMING THE ADDITION TO THE TUNE OF RS. 13 44 708/- ON ACCOUNT OF VALUAT ION OF JEWELLERY EVEN WHEN NO DEFECT WAS HIGHLIGHTED IN THE METHOD OF VAL UATION ADOPTED BY THE APPELLANT. 3. FOR THAT UNDER THE FACTS AND CIRCUMSTANCES OF T HE CASE THE LD. CIT(APPEALS) WAS BAD IN LAW AND UNJUSTIFIED IN NOT APPRECIATING THE REMAND REPORT PROVIDED BY THE ASSESSING OFFICER AND ERRED IN CONFIRMING THE ADDITION MADE TO THE TUNE OF RS. 13 44 708/ -. RELIEF CLAIMED RS. 13 44 708/-. 4. FOR THAT UNDER THE FACTS AND CIRCUMSTANCES OF T HE CASE THE LD. CIT(APPEALS) WAS VEHEMENTLY WRONG AND UNJUSTIFIED I N CONFIRMING THE FINDINGS MADE BY THE LD. A.0. WHICH IS CONTRADICTO RY IPSO FACTO. 5. IT IS THE ARGUMENT OF THE LD. AR THAT HAVING OBS ERVED THE DIFFERENCE IN THE VALUATION OF THE JEWELLERY AS MENTIONED IN THE WEALTH TAX RETURNS AND INCOME TAX RETURNS THE AO CALLED FOR THE DETAILS A ND IT WAS EXPLAINED TO THE AO THAT FOR THE PURPOSE OF WEALTH TAX FAIR MARKET V ALUE IS TAKEN WHEREAS FOR INCOME TAX PURPOSE THE HISTORICAL COST WAS TAKEN A ND SINCE BOTH ARE NOT COMPARABLE NO ADDITION CAN BE MADE ON THAT ACCOUNT . HOWEVER THE AO PROCEEDED TO ADD THE AMOUNT STATING THAT NO RECORD WAS PRODUCED BEFORE HIM TO SUBSTANTIATE THE CONTENTION OF THE ASSESSEE. IN APPEAL WRITTEN SUBMISSIONS WERE MADE BEFORE THE LD. CIT(A) ON 30-11-2015 AND I T IS ONLY AFTER GOING THROUGH SUCH WRITTEN SUBMISSIONS THE LD. CIT(A) CAL LED FOR A REMAND REPORT ON 2-12-2015 AND SUCH REMAND REPORT WAS RECEIVED ON 15 -12-2015. HOWEVER I.T.A. NO. 1093/KOL./2016 ASSESSMENT YEAR: 2006-2007 PAGE 4 OF 7 SINCE THE ASSESSEE COULD NOT APPEAR ON 22-3-2016 T HE LD. CIT(A) PROCEEDED EX-PARTE BUT IGNORED THE EVIDENCE AVAILABLE ON RECORD IN SU PPORT OF THE CONTENTION OF THE ASSESSEE. IT IS THEREFORE PRAYE D THAT THE ORDERS OF AUTHORITIES BELOW MAY BE QUASHED AND THE ADDITIONS MADE BE DELETED. 6. LD. DR ON THE OTHER HAND VEHEMENTLY RELIED UPO N THE ASSESSMENT ORDER AND SUBMITTED THAT IN SPITE OF SEVERAL OPPORT UNITIES GRANTED THE ASSESSEE FAILED TO AVAIL THE SAME AND SINCE THERE W AS NO NEW FACTS THAT BROUGHT TO THE LIGHT DURING THE APPELLATE PROCEEDI NGS LD. CIT(A) JUSTIFIED IN CONFIRMING THE ADDITIONS MADE BY THE AO. FOR THIS R EASON HE PRAYED TO DISMISS THE APPEAL. 7. IN VIEW OF THE ABOVE CONTENTIONS AND FACTUAL POS ITION THE POINT THAT ARISES FOR OUR CONSIDERATION IS AS TO WHETHER THE L D. CIT(A) IS JUSTIFIED IN CONFIRMING THE ASSESSMENT ORDER IN WHICH ADDITION M ADE ON ACCOUNT OF THE DIFFERENCE OBSERVED IN RESPECT OF VALUATION OF THE JEWELLERY AND ORNAMENTS UNDER WEALTH TAX RETURNS AND INCOME TAX RETURNS? POINT: 8. AS COULD BE SEEN FROM THE PROCEEDINGS THE BONE O F CONTENTIONS OF THIS MATTER IS THAT THERE IS A DIFFERENCE IN RESPECT OF VALUATION OF THE JEWELLERY AND ORNAMENTS POSSESSED BY THE ASSESSEE AS MENTIONED BY HIM IN THE WEALTH TAX RETURNS AND INCOME TAX RETURNS. WHEN THE ASSESSEE W AS CALLED UPON TO EXPLAIN THIS THE ASSESSEE EXPLAINED THAT FOR WEALT H TAX RETURNS THE FAIR MARKET VALUE OF THE JEWLLERY AND ORNAMENTS WERE CONSIDERED WHEREAS FOR INCOME TAX I.T.A. NO. 1093/KOL./2016 ASSESSMENT YEAR: 2006-2007 PAGE 5 OF 7 PURPOSE A HISTORICAL COST WAS TAKEN AND SINCE BOTH ARE NON-COMPARABLE NO ADDITION COULD BE MADE ON THIS SCORE. HOWEVER THE AO OBSERVED THAT NO MATERIAL WAS PLACED BEFORE HIM IN SUPPORT OF THIS C ONTENTION OF THE ASSESSEE AND ON THAT SCORE DISBELIEVING THE VERSION OF THE A SSESSEE THE AO MADE ADDITIONS TO A TUNE OF RS.13 44 708/-. 8. LD. CIT(A) CALLED FOR REMAND REPORT AND RECEIVED THE SAME BY 15-12- 2015. IT IS SO RECORDED IN THE ORDER OF THE LD. CIT (A). THE COPY OF THE REMAND REPORT IS PRODUCED BY THE ASSESSEE VIDE ANNEXURE-E IN THE PAPER BOOK FURNISHED BY HIM. ANNEXURE-E CLEARLY SHOWS THE REPR ESENTATION OF THE ASSESSEE BEFORE THE AO IN REMAND PROCEEDINGS AND I N THE CONCLUDING PARAGRAPHS THE AO RECORDED THAT THERE WAS NO MALAF IDE INTENTION OF AVOIDING ANY INCOME TAX NOR THERE HAS BEEN ANY CASES OF INCO ME ESCAPING ASSESSMENT. THE AO FURTHER OBSERVED THAT ALL THE DO CUMENTS AND PAPERS SUBMITTED BY ASSESSEE WERE PERUSED AND IT WAS FOUND THAT THE ASSESSEES VALUE OF JEWELLERY AND ORNAMENTS AS PER VALUATION D ATE 31.03.2006 WHICH WAS TAKEN AT AS PER REGISTERED VALUERS REPORT AND IN T HE BALANCE SHEET AS ON 31- 03-2006 JEWELLERY AND ORNAMENTS WERE ACCOUNTED FOR ON ACTUAL COST BASIS. 9. IN SPITE OF THE FACT OF AVAILABILITY OF THIS REM AND REPORT ON RECORD LD. CIT(A) FAILED TO TAKE INTO ACCOUNT WHILE DISPOSING OF THE APPEAL BEFORE HIM. HE SIMPLY RECORDED THAT THE ASSESSEE FAILED TO ENTER A NY APPEARANCE AND MAKE ANY REPRESENTATION. WE FIND THAT THERE IS NO BASIS FOR THE LD. CIT(A) TO OBSERVE THAT THERE IS NO NEW FACT OR DETAILS AVAILABLE FOR CONSIDERATION DURING THE I.T.A. NO. 1093/KOL./2016 ASSESSMENT YEAR: 2006-2007 PAGE 6 OF 7 APPELLATE PROCEEDINGS INASMUCH AS IN THE REMAND RE PORT IT IS WELL BROUGHT OUT THAT IN THE REMAND PROCEEDINGS THE ASSESSEE PRODUCE D SO MANY DOCUMENTS AND THE AO CONVINCED HIMSELF THAT VALUATION OF THE JEWELLERY AND ORNAMENTS FOR WEALTH TAX PURPOSE AND INCOME TAX PURPOSE ARE P ROPER AND GENUINE AND THERE WAS NO MALAFIDE INTENTION TO AVOID ANY TAX NO R THERE HAS BEEN ANY CASE OF INCOME ESCAPING ASSESSMENT. THUS A VITAL NEW FA CT THAT WAS BROUGHT BY WAY OF REMAND REPORT MISSED THE CONTENTION OF THE L D. CIT(A). 10. IN VIEW OF THIS FACTUAL POSITION WE ARE UNABLE TO AGREE WITH THE LD. DR THAT THE AO IS JUSTIFIED IN MAKING ANY ADDITION BEC AUSE IN THE REMAND PROCEEDINGS ALL THE REQUIRED DOCUMENTS WERE PRODUCE D TO THE SATISFACTION OF THE AO AND AO RECORDED A FINDING THAT THERE WAS NO INCOME ESCAPING ASSESSMENT AT ALL. WE THEREFORE FIND THAT IT IS F IT CASE TO ALLOW THE APPEAL AND DELETE THE ADDITIONS MADE BY THE LD. AO AND CONFIRM ED BY THE LD. CIT(A). WE ANSWER THE POINT ACCORDINGLY. 11. IN THE RESULT THE APPEAL OF ASSESSEE IS ALLOWE D . ORDER PRONOUNCED IN THE OPEN COURT ON 07/10/2016 . SD/ - (DR. ARJUN LAL SAINI) SD/ - (NARASIMHA CHARY) #$ / ACCOUNTANT MEMBER $ / JUDICIAL MEMBER /KOLKATA ; $% DATED 07/10/2016 & ()* /PRAKASH MISHRA . / PS I.T.A. NO. 1093/KOL./2016 ASSESSMENT YEAR: 2006-2007 PAGE 7 OF 7 %&' (' / COPY OF THE ORDER FORWARDED TO : / BY ORDER / ( ASSTT. REGISTRAR) / ITAT 1. / THE APPELLANT 2. / THE RESPONDENT. 3. 4 ( ) / THE CIT(A) KOLKATA. 4. 4 / CIT 5. 56 7 8 8 / DR ITAT KOLKATA 6. 7 9 / GUARD FILE. 5 //TRUE COPY//