Meenaben Dharmeshkumar Shah, Bhavnagar v. The Income tax Officer,Ward-2(1),, Bhavnagar

ITA 1858/AHD/2011 | 2008-2009
Pronouncement Date: 26-09-2011 | Result: Allowed

Appeal Details

RSA Number 185820514 RSA 2011
Assessee PAN AFGPS1302G
Bench Ahmedabad
Appeal Number ITA 1858/AHD/2011
Duration Of Justice 2 month(s) 1 day(s)
Appellant Meenaben Dharmeshkumar Shah, Bhavnagar
Respondent The Income tax Officer,Ward-2(1),, Bhavnagar
Appeal Type Income Tax Appeal
Pronouncement Date 26-09-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted SMC
Tribunal Order Date 26-09-2011
Date Of Final Hearing 22-09-2011
Next Hearing Date 22-09-2011
Assessment Year 2008-2009
Appeal Filed On 25-07-2011
Judgment Text
-1- IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'SMC' BEFORE SHRI MUKUL KUMAR SHRAWAT JUDICIAL MEMBER ITA NO.1858/AHD/2011 (ASSESSMENT YEAR:-2008-09) SMT. MEENABEN DHARMESHKUMAR SHAH C/O J. DHANVANTRAI & CO. RANDHANPURI BAZAR BHAVNAGAR V/S THE INCOME-TAX OFFICER WARD-2(1) BHAVNAGAR PAN: AFGPS 1302 G [APPELLANT] [RESPONDENT] APPELLANT BY :- SHRI ANKIT TALSANIA AR RESPONDENT BY:- SHRI S A BOHRA SR. DR DATE OF HEARING:- 22-09-2011 DATE OF PRONOUNCEMENT:- 26-09-2011 O R D E R THIS IS AN APPEAL BY THE ASSESSEE WHICH HAS EMANATE D FROM THE ORDER OF THE LEARNED CIT(A)-XX AHMEDABAD DATED 17-03- 2011. THE RELEVANT GROUNDS RAISED BEFORE ME ARE REP RODUCED BELOW:- [3] THE LEARNED CIT(A) HAS ERRED ON FACTS AND IN LA W IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER OF MAKING THE A DDITION OF RS.2 73 190/- ON A PROTECTIVE BASIS WITHOUT MAKING FULL COMPLETE AND PROPER INQUIRY AS REGARD TO THE REAL R ECIPIENT OF THE INTEREST OF RS.2 73 190/-. [4] BOTH THE LOWER AUTHORITIES HAVE ERRED ON FACTS AND IN LAW IN PASSING THE ORDERS WITHOUT PROPERLY VERIFYING AND A PPRECIATING THE FACTS AND THAT ERRED IN GROSSLY IGNORING THE SU BMISSION 2 ITA NO .1858/AHD/2011 EXPLANATION AND INFORMATION SUBMITTED BY THE APPELL ANT ON 28/07/2010 WHICH OUGHT TO HAVE BEEN CONSIDERED IN I TS RIGHT AND TRUE PERSPECTIVE BEFORE PASSING THE ORDERS. THIS AC TION OF BOTH THE AUTHORITIES IS IN CLEAR AND BALD BREACH OF LAW AND PRINCIPLES OF EQUITY AND NATURAL JUSTICE AND THEREFORE DESERVE S TO BE QUASHED BY DIRECTING THE LOWER AUTHORITY TO DELETE THE ADDITION MADE ON PROTECTIVE BASIS. 2 THE FACTS IN BRIEF AS EMERGED FROM THE CORRESP ONDING ASSESSMENT ORDER PASSED U/S 143(3) OF THE IT ACT 1 961 DATED 14- 12-2010 WERE THAT AN INFORMATION WAS RECEIVED BY TH E ASSESSING OFFICER [AO FOR SHORT] IN RESPECT OF DEDUCTION OF TAX AND ON THAT BASIS A PROTECTIVE ASSESSMENT WAS MADE IN THE FOLLOWING MANNER:- 3. AS PER AIR INFORMATION THE ASSESSEE WAS ASKED W HY INTEREST OF RS.273190/- IS NOT REFLECTED IN THE COMPUTATION OF THE INCOME. IN REPLY VIDE LETTER DATED 28/07/2010 STATED THAT NO DEPOSIT / LOAN IS ADVANCED TO MANIBEN JAIN. NO INTEREST IS RECEIVED. GENERATIN G THE TAX DEDUCTION REPORT IT IS NOTICED THAT DEDUCTOR IS DHYAFAL DEVI CHAND JAIN RESIDING AT CHITRAKOUT SHREE RAM MILL COMPOUND GANPATRAI K ADAM MARG WORLI MUMBAI. A LETTER IS ISSUED BUT RECEIVED UNSER VED FOR VERIFICATION OF TRANSACTION. AT ONE SIDE THE ASSESSEE HAS REFUSED TO RECEIVE THE INTEREST OF RS.273190/- ANOTHER SIDE GENUINENESS OF THE DEPOSI T WITH MANIBEN JAIN IS NOT PROVED CONSIDERING THE USE OF PAN THE AMOUNT OF RS- 273190/- IS ADDED TO THE TOTAL INCOME OF THE ASSESS EE ON 'PROTECTIVE BASIS' TILL THE GENUINENESS OF THE TRANSACTION IS P ROVED. 3 WHEN THE MATTER WAS CARRIED BEFORE THE FIRST APPE LLATE AUTHORITY THE ACTION OF THE AO WAS AFFIRMED BY STA TING THAT PRIMA FACIE THE AO HAD MADE THE SAID ADDITION BECA USE AIR INFORMATION WAS RECEIVED BY HIM. ON THE BASIS OF TH AT INFORMATION THE AO HAD FOUND THAT THE IMPUGNED SUM WAS 3 ITA NO .1858/AHD/2011 RECEIVED AS INTEREST FROM THE SAID DEDUCTOR. THE AC TION OF THE AO WAS THEREFORE HELD AS JUSTIFIED. 4 THE LEARNED AR MR. ANKIT TALSANIA APPEARED AND IN FORMED THAT VIDE SHOW CAUSE NOTICE DATED 20-07-2010 THE A O HAS STATED THAT AN INFORMATION WAS RECEIVED THAT THE ASSESSEE HAD RECEIVED INTEREST FROM SMT. MANIBEN JAIN AND THAT INTEREST W AS NOT REFLECTED IN THE STATEMENT OF INCOME. THERE WAS A C ONTRADICTION IN THE SAID SHOW CAUSE NOTICE AND THE REASON GIVEN BY THE AO FOR THE IMPUGNED PROTECTIVE ASSESSMENT. HE HAS STRONGLY OBJECTED THE MANNER IN WHICH THE PROTECTIVE ASSESSMENT WAS MADE THOUGH THERE WAS NO INDICATION WHERE SUBSTANTIVE ASSESSME NT TO BE MADE. THE LEARNED AR HAS PLACED RELIANCE ON THE D ECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF LALJI HARI DAS VS ITO [43 ITR 387] AND THE DECISION OF THE HONBLE ALLAHA BAD HIGH COURT IN THE CASE OF ASHARFI LAL VS. CIT [66 ITR 62 ]. 5 FROM THE SIDE OF THE REVENUE THE LEARNED DR MR. S A BOHRA APPEARED AND STATED THAT ONCE AN INFORMATION WAS IN POSSESSION OF THE REVENUE DEPARTMENT THEN THE AO HAD NO OPTION BUT TO TAKE APPROPRIATE ACTION IN THE HANDS OF THE PERSON AGAINST WHOM THAT INFORMATION WAS GATHERED. THE AO HAS ACTED ON THE BASIS OF THE SAID INFORMATION AND THEREFORE HIS ACTION DESERVES TO BE AFFIRMED. 6 I HAVE HEARD BOTH THE SIDES AND PERUSED THE ORDER S OF THE AUTHORITIES BELOW. THE WAY THE AO HAS PROCEEDED AP PEARS TO BE CONTROVERSIAL BECAUSE ON ONE HAND THERE WAS A REFER ENCE OF A LOAN 4 ITA NO .1858/AHD/2011 ADVANCED TO ONE SMT. MANIBEN JAIN BUT ON THE OTHER HAND THERE WAS A REFERENCE OF A DEDUCTOR OF TAX ALLEGED TO BE BY ONE SHRI DAHYALAL RAVICHAND JAIN. THE AO WAS NOT SURE WHO H AD DEDUCTED THE TAX AND WHO WAS ACTUAL RECIPIENT OF TH E INTEREST. FROM THE ASSESSMENT ORDER ITSELF IT IS APPARENT THA T HE WAS IN DOUBT HENCE THE IMPUGNED ADDITION WAS MADE PROTEC TIVELY. IT IS ALSO NOT CLEAR FROM THE ASSESSMENT ORDER THAT IN WHOSE H ANDS THE AO HAS PROPOSED TO MAKE SUBSTANTIVE ASSESSMENT . I AM OF THE VIEW THAT THE DECISION OF THE THE HON'BLE SU PREME COURT IN THE CASE OF LALJI HARIDAS VS ITO [43 ITR 387] AS ALSO THE DECISION OF THE HONBLE ALLAHABAD HIGH COURT IN THE CASE OF ASHARFI LAL VS. CIT [66 ITR 62] GIVE GUIDELINES IN RESPECT OF JUDICIOUS APPROACH OF THE AO. MERELY ON DOUBTS A P ROVISIONAL ASSESSMENT WAS HELD AS NOT PERMISSIBLE. UNDER THE T OTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE THE ORDER OF T HE AUTHORITIES BELOW IS HEREBY REVERSED AND THE ADDITION IS THEREF ORE DELETED. 7 IN THE RESULT THE APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE COURT TODAY ON 26-09-2011 SD/- (MUKUL KUMAR SHRAWAT) JUDICIAL MEMBER DATE : 26-09-2011 COPY OF THE ORDER FORWARDED TO: 1. SMT. MEENABEN DHARMESHKUMAR SHAH C/O J. DHANVAN TRAI 5 ITA NO .1858/AHD/2011 & CO. RANDHANPURI BAZAR BHAVNAGAR 2. THE INCOME-TAX OFFICER WARD-2(1) BHAVNAGAR 3. CIT CONCERNED 4. CIT(A)-XX AHMEDABAD 5. DR ITAT AHMEDABAD BENCH-SMC AHMEDABAD 6. GUARD FILE BY ORDER DEPUTY REGISTRAR ASSISTANT REGISTRAR ITAT AHMEDABAD