ITO 20(3)-1, MUMBAI v. FAIZAL A KHAN, MUMBAI

ITA 2491/MUM/2011 | 2005-2006
Pronouncement Date: 24-07-2013 | Result: Partly Allowed

Appeal Details

RSA Number 249119914 RSA 2011
Assessee PAN AIFPK1248K
Bench Mumbai
Appeal Number ITA 2491/MUM/2011
Duration Of Justice 2 year(s) 3 month(s) 24 day(s)
Appellant ITO 20(3)-1, MUMBAI
Respondent FAIZAL A KHAN, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 24-07-2013
Appeal Filed By Department
Order Result Partly Allowed
Bench Allotted F
Tribunal Order Date 24-07-2013
Date Of Final Hearing 10-07-2013
Next Hearing Date 10-07-2013
Assessment Year 2005-2006
Appeal Filed On 30-03-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH F MUMBAI BEFORE SHRI RAJENDRA SINGH ACCOUNTANT MEMBER AND DR. S.T.M. PAVALAN JUDICIAL MEMBER ITA NO. 2491/MUM/2011 ASSESSMENT YEAR: 2005-06 ITO 20(3)-1 ROOM NO. 605 6 TH FLOOR PIRAMAL CHAMBERS LALBAUG MUMBAI 400012 VS. SHRI FAIZAL A KHAN A-1201 BROOK HILL TOWERS LOKHANDWALA COMPLEX 3 RD LANE ANDHERI (W) MUMBAI 53 PAN: AIFPK 1248 K (APPELLANT) (RESPONDENT) REVENUE BY : MR. C.V.K. NAIR ASSESSEE BY : MR. R.S. MODI DATE OF HEARING : 10.07.2013 DATE OF PRONOUNCEMENT : 24.07.2013 O R D E R PER DR. S.T.M. PAVALAN JM: THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAIN ST THE ORDER OF THE LD.CIT(A) -31 MUMBAI DATED 14.01.2011 FOR THE ASS ESSMENT YEAR 2005-06. 2. GROUND NO. 1 RELATES TO THE DISALLOWANCE/ADDITIO N OF RS.50 56 500/- MADE BY THE AO U/S 68/69 OF THE INCOME TAX ACT AND THE SAME DELETED BY THE LD.CIT(A) TO THE EXTENT OF RS.36 74 500/-. 2.1 BRIEFLY STATED THE ASSESSEE AN INDIVIDUAL ENG AGED IN THE BUSINESS OF CONSULTING WHILE DECLARING A TOTAL INCOME OF RS.4 6 6 400/- IN THE CAPITAL ACCOUNT HAD SHOWN A GIFT RECEIVED FROM HIS FATHER AMOUNTING TO RS.50 LACS AND FURTHER SHOWN A PURCHASE OF A NEW FLAT AMOUNTING TO RS.50 56 500/- IN THE BALANCE SHEET. IN THE ASSESSMENT FRAMED U/S 144 OF THE ACT THE AO AFTER NOTING THAT THE ASSESSEE HAD NOT FURNISHED ANY SUPPORTING EVIDENCE FOR THE INVESTMEN T HAD TAKEN THE HIGHER FIGURE OF RS.50 56 500/- AND ADDED THE SAME TO THE TOTAL INCO ME OF THE ASSESSEE U/S 68/69 AS ITA NO. 2491/MUM/2011 SHRI FAIZAL A KHAN ASSESSMENT YEAR: 2005-06 2 BOTH APPLIES IN THE CASE OF ASSESSEE AS UNEXPLAINED CASH CREDIT AND UNEXPLAINED INVESTMENT. 2.1.1 ON APPEAL THE LD.CIT(A) BY RELYING ON THE A DDITIONAL EVIDENCES FILED BY THE ASSESSEE AFTER OBTAINING THE REMAND REPORT FROM TH E AO HAD HELD THAT THE INVESTMENT MADE TO THE EXTENT OF RS.36 74 500/- IS EXPLAINED AND DELETED THE ADDITION TO THE TUNE OF RS.36 74 500/- ( SIC ). AGGRIEVED BY THE IMPUGNED DECISION THE REVENUE HAS RAISED THIS GROUND IN THE APPEAL BE FORE US. 2.2 HAVING HEARD BOTH THE SIDES AND PERUSED THE MAT ERIAL ON RECORD IT IS OBSERVED THAT THE COST OF THE FLAT PURCHASED IS OF RS.50 56 500/- OUT OF WHICH THE RS. RS.36 74 500/- HAVE BEEN MADE THROUGH CHEQUES/DEMAN D DRAFTS ISSUED FROM THE BANK ACCOUNT OF HIS ASSOCIATE CONCERNS. THE SAID PA YMENTS ARE FOUND TO BE EXPLAINED BEFORE THE LD.CIT(A) AND THE DETAILS OF W HICH ARE REPRODUCED BELOW: DATE OF PAYMENT PARTICULAR OF PAYMENTS MADE AMOUNT PAID IN RS. 20.07.2004 DD FOR STAMP DUTY OUT OF BANK ACCOUNT O F ZELIG EXPORTS PVT. LTD. 2 07 500/- 31.01.2005 DD FROM BANK ACCOUNT OF ZELIG EXPORTS PVT LTD. 30 00 000/- 18.02.2005 DD FROM BANK ACCOUNT OF ZELIG EXPORTS PVT LTD. 3 00 000/- 21.02.2005 DD FROM BANK ACCOUNT OF FAUSTINE EXPORTS PVT LTD. 1 47 000/- TOTAL 36 54 500/- THE ASSESSEE HAS ALSO FURNISHED THE CONFIRMATIONS O F HIS ASSOCIATE CONCERNS VIZ M/S ZELIG EXPORTS PVT LTD. AND M/S FAUSTINE EXPORTS PVT LTD. IN WHICH HE IS A MAJOR SHAREHOLDER/DIRECTOR CONFIRMING THE PAYMENTS MADE O F RS.36 74 500/-( SIC ) FOR THIS PURPOSE WHICH IS DULY ADMITTED BY THE AO IN HIS REM AND REPORT. SINCE THE LD.CIT(A) IS JUSTIFIED IN HOLDING THAT THE INVESTMENT MADE TO THE EXTENT OF RS.36 74 500/-( SIC ) IS EXPLAINED BY THE ASSESSEE THE DECISION OF THE L D.CIT(A) ON THIS COUNT IS UPHELD. GROUND NO. 1 IS DISMISSED. 3. GROUND NO.2 RELATES TO THE ADDITION OF RS. 23 LA CS MADE BY THE AO U/S 69 OF THE ACT IN RESPECT OF PURCHASE OF NEW MOTOR CAR AND THE SAME REDUCED BY THE LD.CIT(A) TO THE EXTENT OF RS.4 50 000/-. 3.1 HAVING HEARD BOTH THE SIDES ON THIS GROUND AND PERUSED THE MATERIAL ON RECORD IT IS OBSERVED THAT THE ASSESSEE HAS AVAILE D A CAR LOAN OF RS.16 47 000/- FROM ITA NO. 2491/MUM/2011 SHRI FAIZAL A KHAN ASSESSMENT YEAR: 2005-06 3 ABN-AMRO BANK FOR THE PURCHASE OF THE NEW CAR AND T HE LD.CIT(A) HAS PROPERLY DELETED THE IMPUGNED ADDITION MADE BY THE AO U/S 69 OF THE ACT. AS REGARDS THE CLAIM OF THE ASSESSEE THAT A PAYMENT OF RS.4 50 000 /- HAS BEEN RECEIVED ON EXCHANGE OF OLD VEHICLE THE LD.CIT(A) HAS ARRIVED AT A CONCLUSION THAT THE SAME REMAIN UNEXPLAINED AS NO EVIDENCE REGARDING THE SAL E OF OLD VEHICLE AND THE RECEIPT THEREOF HAS BEEN PRODUCED BEFORE HIM. EXCEPT CONFIR MING THE ADDITION ON ACCOUNT OF THIS IMPUGNED AMOUNT OF RS.4 50 000/- THE LD.CIT(A ) HAS DELETED THE REMAINING AMOUNT OF RS.18 50 500/- WHEREAS THE ASSESSEE COUL D EXPLAIN ONLY THE INVESTMENT RS.16 47 000/- WHICH IS BY WAY OF LOAN AVAILED FROM ABN-AMRO BANK. IT IS PERTINENT TO NOTE THAT THE LD.CIT(A) HAS DELETED THE REMAININ G AMOUNT OF RS.2 03 000/- IN THE SAID ADDITION MADE BY THE AO AMOUNTING TO RS23 LACS WITHOUT ANY DISCUSSION AS HOW THE ASSESSEE HAS EXPLAINED THE SAID INVESTMENT OF R EMAINING AMOUNT OF RS.2 03 000/. CONSIDERING THIS OMISSION/INADVERTENT ERROR IN THE ORDER OF THE LD.CIT(A) WE ARE OF THE VIEW THAT IT IS JUST AND P ROPER TO SEND THE LIMITED ISSUE OF DECIDING THE MATTER ON THE LEFT OUT AMOUNT OF RS.2 03 000/- TO THE FILE OF THE LD.CIT(A) TO PASS A REASONED AND SPEAKING ORDER. IT IS NEEDLESS TO EXPLAIN THAT IN THE PROCESS THAT THE LD.CIT(A) SHALL GIVE AN OPPORT UNITY OF BEING HEARD TO THE ASSESSEE. WE DIRECT AND ORDER ACCORDINGLY. GROUND N O.2 IS ALLOWED FOR STATISTICAL PURPOSE. 4. GROUND NO.3 RELATES TO THE ADDITION OF RS.12 81 950/- MADE BY THE AO ON ACCOUNT OF CASH DEPOSIT IN CITY BANK SAVING ACCOUNT AND THE SAME DELETED BY THE LD.CIT(A) TO THE EXTENT OF RS.8 72 000/-. 4.1 HAVING HEARD BOTH THE SIDES AND PERUSED THE MAT ERIAL ON RECORD IT IS NOTED THAT THE LD.CIT(A) HAS ELABORATELY DISCUSSED THE IS SUE FROM PARA 6.4 TO 6.4.3 OF HIS ORDER. IT IS FOUND THAT THE ASSESSEE HAS NOT PRODUC ED ANY EVIDENCE BEFORE THE LD.CIT(A) AS REGARDS HIS CLAIM THAT PETTY CASH WITH DRAWALS MADE FROM THE ATM IS THE SOURCE OF CASH DEPOSIT TO THE EXTENT OF RS.4 09 450/-. HOWEVER AS REGARDS THE REMAINING CASH DEPOSIT TO THE TUNE OF RS.8 72 000/- WHICH THE LD.CIT(A) DELETED THE ASSESSEE HAS EXPLAINED THAT THE WITHDRAWALS FRO M THE ACCOUNT OF HIS ASSOCIATE CONCERN AND THE CORRESPONDING DEPOSITS IN HIS ACCOU NT ARE ON THE SAME DATES AND THE DEPOSITS ARE OUT OF THE WITHDRAWALS MADE FROM H IS ASSOCIATE CONCERN. THIS BEING ITA NO. 2491/MUM/2011 SHRI FAIZAL A KHAN ASSESSMENT YEAR: 2005-06 4 THE FACT THE LD. DR COULD NOT POINT OUT ANY INFIRM ITY IN THE ORDER OF THE LD.CIT(A) AND THEREFORE WE ARE OF THE CONSIDERED OPINION THAT THERE IS NO JUSTIFIABLE REASON TO INTERFERE WITH THE FINDINGS OF THE LD.CIT(A) ON THI S COUNT AND THE SAME IS UPHELD. GROUND NO. 3 IS DISMISSED. 5. IN THE RESULT THIS APPEAL FILED BY THE REVENUE IS PARTLY ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 24 TH DAY OF JULY 2013. SD/- SD/- (RAJENDRA SINGH) (DR. S.T.M. PAVALAN) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI DATED: 24.07.2013. *SRIVASTAVA COPY TO: THE APPELLANT THE RESPONDENT THE CIT CONCERNED MUMBAI THE CIT (A) CONCERNED MUMBAI THE DR F BENCH //TRUE COPY// [ BY ORDER DY/ASSTT. REGISTRAR ITAT MUMBAI.