M/s. Gulam Hussain Moulbi Ismail Imam, Nani Daman v. The Income tax Officer,Vapi Ward-4,, Daman

ITA 2036/AHD/2010 | 2006-2007
Pronouncement Date: 09-09-2010 | Result: Allowed

Appeal Details

RSA Number 203620514 RSA 2010
Bench Ahmedabad
Appeal Number ITA 2036/AHD/2010
Duration Of Justice 2 month(s) 29 day(s)
Appellant M/s. Gulam Hussain Moulbi Ismail Imam, Nani Daman
Respondent The Income tax Officer,Vapi Ward-4,, Daman
Appeal Type Income Tax Appeal
Pronouncement Date 09-09-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted SMC
Tribunal Order Date 09-09-2010
Date Of Final Hearing 09-09-2010
Next Hearing Date 09-09-2010
Assessment Year 2006-2007
Appeal Filed On 10-06-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH SMC AHMEDABAD BEFORE SHRI MAHAVIR SINGH JUDICIAL MEMBER ITA NO.2036/AHD/2010 ASSESSMENT YEAR:2006-07 DATE OF HEARING:9.9.10 DRAFTED:14.9.1 0 MS.GULAM HUSAIN MOULBI ISMAIL IMAM SHOP NO.1 MAYUR APT. KHARIWAD NANI DAMAN PAN NO.AAJPI9223J V/S . INCOME TAX OFFICER VAPI WARD-4 DAMAN (APPELLANT) .. (RESPONDENT) APPELLANT BY :- SHRI TUSHAR P HEMANI AR RESPONDENT BY:- SHRI S.K. JHA SR-DR O R D E R THIS APPEAL BY ASSESSEE IS ARISING OUT OF THE ORDE R OF COMMISSIONER OF INCOME-TAX (APPEALS)-VALSAD IN APPEAL NO.CIT(A)VLS/ 174/08-09 DATED 22-01-2010. THE ASSESSMENT WAS FRAMED BY ITO VAPI WARD-4 DAMAN U/S.143(3) OF THE INCOME- TAX ACT 1961 (HEREINAFTER REFERRED TO AS THE ACT ) VIDE HIS ORDER DATED 20-11-2008 FOR ASSESSMENT YEAR 2006-07. 2. THE FIRST ISSUE IN THIS APPEAL OF ASSESSEE IS AG AINST THE ORDER OF CIT(A) IN CONFIRMING AD HOC DISALLOWANCE OF RS.1 23 610/- OUT OF VARIOUS EXPENSES FOR NON- MAINTENANCE OF BUSINESS VOUCHERS. 3. THE BRIEF FACTS LEADING TO ABOVE ISSUE ARE THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER REQUIR ED THE PRODUCE THE BILLS & VOUCHERS OF EXPENSES DEBITED AT RS.6 70 360/- BUT ASSESSEE FAILED TO PRODUCE ANY SUPPORTING VOUCHERS TO THE BOOKS OF ACCOUNT. IN THE ABSENCE OF THE SAME THE AO MADE DISALLOWANCE OF 20% AT RS.1 23 610/-. AGGRIEVE D ASSESSEE PREFERRED APPEAL ITA NO2036/AHD/2010 A.Y.2006-07 MS GULAM HUSAIN MOULBI ISMAIL IMAM V. ITO VAPI WD -3 DAMAN PAGE 2 BEFORE CIT(A) AND CIT(A) CONFIRMED THE DISALLOWANCE BY GIVING FOLLOWING FINDING IN PARA-6.1 AND 6.2 OF IS APPELLATE ORDER:- 6.1 DURING THE ASSESSMENT PROCEEDINGS ON PERUSAL O F THE PROFIT & LOSS A/C THE LD. AO OBSERVED THAT THE ASSESSEE HAS DEBITED RS.6 70 360/- OUT OF WHICH RS.52 310/- PAID FOR BANK INTEREST AND RS.6 18 050/ - IS BALANCE EXPENSE. DURING THE PROCEEDINGS THE LD. AO ASKED TO PRODUCE BILLS AND VOUCHERS FROM VERIFICATION. THE ASSESSEE COULD NOT PRODUCE ANY VO UCHERS OR BILLS IN SUPPORT OF THE CLAIM OF EXPENSES. AS THE ASSESSEE FAILED TO PRODUCE SUPPORTING VOUCHERS AND BILLS FOR VERIFICATION THEREFORE 20% OF THESE EXPENSES WERE DISALLOWED WHICH COMES TO RS.1 23 610/-. FINDINGS 6.2. AS THE LD. AR OF THE APPELLANT EXPRESS HIS INA BILITY TO EXPRESS ANYTHING IN SUPPORT OF THEIR CLAIM OF EXPENSES IT IS CRYSTAL C LEAR THAT THEY HAVE NO OBJECTION FOR SUCH DISALLOWANCE. ON THE BASIS OF MY FINDINGS AND FACTS OF THE CASE I INCLINE TO HOLD THAT THE ACTION TAKEN BY TH E LD. AO IS FULLY JUSTIFIED. THE APPEAL ON THIS GROUND IS DISMISSED. AGGRIEVED ASSESSEE PREFERRED SECOND APPEAL BEFORE TRIBUNAL. 4. AFTER HEARING BOTH THE SIDES I FIND THAT THE AS SESSEES MAIN PLEA IS THAT ONLY A REASONABLE DISALLOWANCE SHOULD BE MADE AND THE LD. COUNSEL FOR THE ASSESSEE HAS NOT DENIED THE PERSONAL ELEMENT IN USER OF SOME OF THE ASSETS AS WELL AS FOR THE NON- BUSINESS PURPOSES. ACCORDINGLY I AM OF THE VIEW TH AT THE DISALLOWANCE OF 1/10 TH OF THE EXPENSES WILL MEET THE ENDS OF JUSTICE THAT AL SO ON ACCOUNT OF PERSONAL USER. ACCORDINGLY THIS ISSUE OF THE ASSESSEES APPEAL IS PARTLY ALLOWED. 5. THE NEXT ISSUE IN THIS APPEAL OF ASSESSEE IS AGA INST THE ORDER OF CIT(A) IN CONFIRMING THE ADDITION MADE BY ASSESSING OFFICER U /S.68 OF THE ACT ON ACCOUNT OF UNSECURED LOANS OF RS.1.25 LAKH. 6. THE BRIEF FACTS LEADING TO THE ABOVE ISSUE ARE T HAT THE ASSESSEE HAS TAKEN A LOAN OF RS.1.25 LAKH FROM SHRI MAULB ISMAIL EMAMAM. THE ASSESSING OFFICER REQUIRED THE ASSESSEE TO FURNISH CONFIRMATION FROM THE DEPOSITOR WITH DOCUMENTARY EVIDENCES PROVING CREDITWORTHINESS IDENTITY GENUI NENESS OF TRANSACTION OF THE CREDITOR. THE ASSESSEE HAS RECEIVED LOAN OF RS.50 0 00/- RS.25 000/- AND RS.50 000/- IN CASH ON 01-04-2005 10-04-2005 AND 1 5-05-2005 RESPECTIVELY FROM THE CREDITOR SHRI MAULB ISMAIL EMAMAM. BEFORE THE AO THE ASSESSEE STATED THAT THE ITA NO2036/AHD/2010 A.Y.2006-07 MS GULAM HUSAIN MOULBI ISMAIL IMAM V. ITO VAPI WD -3 DAMAN PAGE 3 CREDITOR WHO IS THE FATHER OF THE ASSESSEE IS NOT DOING ANY WORK SINCE LAST 8-10 YEARS. ACCORDINGLY AO TREATED THE LOAN OF RS.1.25 LAKH AS UNEXPLAINED U/S.68 OF THE ACT AS THE ASSESSEE COULD NOT EXPLAIN ANYTHING ABOU T THE SOURCE AND CREDITWORTHINESS. AGGRIEVED ASSESSEE PREFERRED APP EAL BEFORE CIT(A). 7. THE CIT(A) CONFIRMED THE ADDITION BY GIVING FOLL OWING FINDINGS IN PARA-5.1 AND 5.2 OF HIS APPELLATE ORDER:- 5.1 DURING THE ASSESSMENT PROCEEDINGS ON PERUSAL O F THE BALANCE SHEET THE LD. AO OBSERVED THAT THE ASSESSEE HAS TAKEN UNSECU RED LOAN OF RS.1 25 000/-. THE ASSESSEE WAS ASKED TO FURNISH TH E CONFIRMATION OF THE BALANCE FROM THE DEPOSITORS WITH DOCUMENTARY EVIDEN CES PROVING CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTION . ON VERIFICATION OF THE CONFIRMATION SUBMITTED IT WAS OBSERVED THAT LOAN O F RS.50 000/- RS.25 000/- AND RS.50 000/- WERE RECEIVED IN CASH IN ONE MONTH ONLY AND IT IS ALSO TO BE NOTED THAT THE DEPOSITOR IS NOT ASSESSED TO TAX. TH E LD. AO ASKED TO FURNISH COPY OF THE RETURN OF INCOME FOR VERIFYING THE CRED IT WORTHINESS OF THE DEPOSITOR AND ADJOURNED THE HARING. BUT THE ASSESSEE COULD NO T PRODUCE ANY DOCUMENTARY EVIDENCE FOR PROVING THE CREDITWORTHINE SS OF THE DEPOSITOR EXCEPT THE ORAL EXPLANATION THAT THE DEPOSITOR IS H IS FATHER. ON ASKING THE SOURCE OF INCOME OF THE ASSESSEES FATHER THE ASSE SSEE EXPRESS HIS INABILITY TO EXPLAIN ANY THING ON THE MATTER. ON THE BASIS OF THE ABOVE THE LD. AO SATISFIED THAT THE SAID UNSECURED LOAN IS NOTHING B UT UNEXPLAINED CASH U/S./68 AND SAME HAS BEEN ADDED TO THE TOTAL INCOME. FINDINGS 5.2 THE LD. AR OF THE APPELLANT COULD NOT PROVE THE CREDITWORTHINESS OF THE DEPOSITOR AND COULD NOT PROVE THE GENUINENESS OF TH E TRANSACTION. BY NOT SUBMITTING ANYTHING HE PROVED HIS INABILITY TO EXPR ESS ANYTHING IN SUPPORT OF THE CLAIM. SO ON THE BASIS OF THE ABOVE I INCLINE D TO HOLD THAT THE ACTION TAKEN BY THE LD. AO IS JUSTIFIED. THE APPEAL ON THIS GROU ND IS DISMISSED. AGGRIEVED ASSESSEE CAME IN SECOND APPEAL BEFORE TR IBUNAL. 8. AT THE OUTSET LD. COUNSEL FOR THE ASSESSEE FAIRL Y STATED THAT THE ASSESSING OFFICER HAS NOT EXAMINED THE AFFIDAVIT FILED BY THE CREDITOR AND HE STATED THAT EVEN THE CIT(A) HAS NOT GONE INTO THE DETAILS OF AFFIDAV IT. HE CATEGORICALLY ADMITTED THAT THIS AFFIDAVIT WAS FILED BEFORE BOTH THE LOWER AUTH ORITIES. HE NOW FIELD THE COPY OF AFFIDAVIT BEFORE ME WHICH IS DATED 24-08-2009. IN VIEW OF THESE FACTS THE LD. COUNSEL FOR THE ASSESSEE STATED THAT LET THE MATTER BE RESTORED BACK TO THE FILE OF ASSESSING OFFICER TO VERIFY THE CONTENTS OF THE AFF IDAVIT AND THEN DECIDE ABOUT THE ITA NO2036/AHD/2010 A.Y.2006-07 MS GULAM HUSAIN MOULBI ISMAIL IMAM V. ITO VAPI WD -3 DAMAN PAGE 4 CREDITWORTHINESS OF THE CREDITOR. THE LD. SR-DR HAS NOT OBJECT TO THE REMITTANCE OF THIS MATTER BACK TO THE FILE OF ASSESSING OFFICER. 9. IN VIEW OF THE ABOVE FACTS I AM OF THE VIEW THA T THIS AFFIDAVIT WAS NOT EXAMINED BY THE LOWER AUTHORITIES HENCE THIS REQU IRES VERIFICATION AT THE LEVEL OF ASSESSING OFFICER. THE AO AFTER EXAMINING THE VERAC ITY AND THE CONTENTS OF THE AFFIDAVIT WILL GIVE FINDINGS IN RESPECT OF CREDITW ORTHINESS OF THE CREDITOR. ACCORDINGLY THIS ISSUE OF THE ASSESSEES APPEAL IS SET ASIDE TO THE FILE OF ASSESSING OFFICER FOR FRESH ADJUDICATION. 10. IN THE RESULT ASSESSEES APPEAL IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 09/09/2010 SD/- (MAHAVIR SING H) (JUDICIAL MEMBER) AHMEDABAD DATED : 09/09/2010 *DKP COPY OF THE ORDER FORWARDED TO :- 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT(APPEALS)-VALSAD 4. THE CIT CONCERNS. 5. THE DR ITAT AHMEDABAD 6. GUARD FILE. BY ORDER /TRUE COPY/ DEPUTY / ASSTT.REGISTRAR ITAT AHMEDABAD