GRAND LIVING (INDIA) P. LTD, MUMBAI v. ACIT CEN CIR-45, MUMBAI

ITA 2757/MUM/2009 | 2005-2006
Pronouncement Date: 26-03-2010 | Result: Allowed

Appeal Details

RSA Number 275719914 RSA 2009
Assessee PAN AAACS4566P
Bench Mumbai
Appeal Number ITA 2757/MUM/2009
Duration Of Justice 10 month(s) 27 day(s)
Appellant GRAND LIVING (INDIA) P. LTD, MUMBAI
Respondent ACIT CEN CIR-45, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 26-03-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted SMC
Tribunal Order Date 26-03-2010
Date Of Final Hearing 22-03-2010
Next Hearing Date 22-03-2010
Assessment Year 2005-2006
Appeal Filed On 29-04-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC MUMBAI BEFORE SHRI R.V.EASWAR SENIOR VICE PRESIDENT ITA NO. 2755 AND 2757/MUM/2009 (ASSESSMENT YEARS: 2004-05 AND 2005-06) M/S GRAND LIVING (INDIA) PVT.LTD. 53 HAJI MAHAL MOHAMMED ALI ROAD MUMBAI. APPELLANT (PAN: AAACS4566P) VS ACIT CENTRAL CIRCLE 45 AYAKAR BHAVAN M K ROAD MUMBAI-400020. RESPONDENT APPELLANT BY : SHRI DEEPAK TRALSHWAL A RESPONDENT BY : SHRI MOHD. USMAN O R D E R THESE ARE APPEALS BY THE ASSESSEE RELATING TO ASSE SSMENTS YEARS 2004-05 AND 2005-06. SINCE A SINGLE COMMON ISSUE IS INVOLVED IN THE APPEALS AND SINCE THEY WERE ALSO HEARD TOGETHER TH EY ARE DISPOSED OFF BY A SINGLE ORDER. 2. THE ASSESSEE IS A PRIVATE LIMITED COMPANY ENGAG ED IN DEVELOPING AND CONSTRUCTION OF SERVICE APARTMENTS. THE NATURE OF THE BUSINESS CONSISTS OF BUYING IMMOVABLE PROPERTY DEMOLISH TH E SAME AND BUILD SERVICE APARTMENTS ON THE LAND. 3. IN THE COURSE OF SEARCH CONDUCTED U/S 132 OF TH E ACT ON 21.3.2006 A STATEMENT WAS TAKEN FROM ONE SHRI RE HMATULLAH PATEL THAT TWO CASH PAYMENTS SHOWN BY THE SEIZED MATERIAL VIZ RS.1 56 250/- AND RS.4 22 000/- FOR THE ASSESSMENT YEARS 2004-05 AND 2005-06 RESPECTIVELY FOR THE CONSTRUCTION WORK WERE MET OU T OF UNACCOUNTED ITA NO. 2755 AND 2757/MUM/2009 (ASSESSMENT YEARS: 2004-05 AND 2005-06) 2 INCOME. ON THE BASIS OF THE STATEMENT ADDITIONS W ERE MADE IN THE ASSESSMENTS OVERLOOKING THE ASSESSEES CLAIM THAT THE CASH PAYMENTS WERE EXPLAINABLE. THE ASSESSEE FILED AN APPEAL BE FORE THE CIT(A) AND SUBMITTED THAT THE CASH PAYMENTS WERE EXPLAINABLE A ND THEY WERE MET OUT OF MONIES RECEIVED FROM DEMOLITION OF STRUCTURES B UT THE CLAIM WAS REJECTED BY THE CIT(A) ON THE GROUND THAT NO EVIDEN CE WAS ADDUCED IN SUPPORT OF THE SAME. HE THEREFORE UPHELD THE ADD ITIONS. 4. THE ASSESSEE IS IN FURTHER APPEAL BEFORE TRIBUNA L. A PAPER BOOK WAS FILED CONTAINING A CERTIFICATE DATED 12.12.2007 FROM GLOBAL STRUCTCON CONSULTING ENGINEERS AND FROM ASHCON CONSTRUCTIONS DATED 20.12.2007. IN THE CERTIFICATE ISSUED BY GLOBAL STRUCTCON IT W AS CERTIFIED THAT THE SCRAP VALUE OF THE BUILDING WHICH WAS DEMOLISHED IN THE YEAR 2004 WOULD AMOUNT TO RS.7 00 000/- APPROXIMATELY. IN THE CERT IFICATE GIVEN BY ASHCON CONSTRUCTIONS THEY HAVE CONFIRMED THAT THEY HAD UN DERTAKEN THE DEMOLITION WORK OF THE BUILDING AND HAD PAID THE AS SESSEE RS.6 00 000/- FOR THE KAAT MAAL. IT WAS THE SUBMISSION OF THE LEARNED COUNSEL FOR THE ASSESSEE THAT THESE TWO CERTIFICATES SHOULD BE ADMI TTED AS ADDITIONAL EVIDENCE UNDER RULE 29 OF THE TRIBUNAL RULES. AN A FFIDAVIT DATED 17.3.2010 SWORN TO BY SHRI AFZAL PATEL DIRECTOR OF THE ASSESSEE- COMPANY WAS ALSO FILED EXPLAINING THE REASONS WHY THE ADDITIONAL EVIDENCE COULD NOT BE ADDUCED BEFORE THE INCOME TAX AUTHORITIES. IT HAS BEEN STATED THAT IN APRIL 2007 DISPUTES AROSE W ITHIN THE FAMILY OF THE PERSONS WHO WERE CONTROLLING THE ASSESSEE-COMPANY DUE TO WHICH NEITHER THE REPORT OF THE CONSULTING ENGINEERS EV ALUATING THE SCRAP VALUE NOR THE CERTIFICATE OF DEMOLITION FROM CONTRACTORS WAS MADE AVAILABLE TO THE ASSESSEE-COMPANY DURING THE ASSESSMENT OR APPEL LATE PROCEEDINGS. IT WAS AVERRED FURTHER THAT THE DIRECTORS WHO WERE LOOKING AFTER THE ITA NO. 2755 AND 2757/MUM/2009 (ASSESSMENT YEARS: 2004-05 AND 2005-06) 3 ASSESSEE-COMPANYS AFFAIRS AT THAT TIME DID NOT PAR T WITH THE CERTIFICATES. IT IS FURTHER STATED IN THE AFFIDAVIT THAT IT WAS ONLY FEW MONTHS AGO AFTER AN AMICABLE SETTLEMENT THAT THE ASSESSEE-COMPANY WAS GIVEN COPIES OF THE CERTIFICATES AND THE SAME ARE BEING PLACED AS AN AD DITIONAL EVIDENCE BEFORE THE TRIBUNAL. 5. THE PRAYER FOR ADMISSION OF THE ADDITIONAL EVIDE NCE IS OPPOSED BY THE DEPARTMENT ON THE GROUND THAT IT IS AN AFTER TH OUGHT. 6. I HAVE CONSIDERED THE PRAYER AND ALSO HEARD THE RIVAL SUBMISSIONS. IN THE LIGHT OF THE AFFIDAVIT IT SEEMS TO ME THAT THE INTERESTS OF JUSTICE REQUIRE THAT THE ADDITIONAL EVIDENCE SHOULD BE ADMI TTED. EVEN BEFORE THE CIT(A) IN THE STATEMENT OF FACTS AS WELL AS GROUND NO.2 THE ASSESSEE HAD STATED THAT CERTAIN AMOUNTS WERE RECEIVED FROM THE DEMOLITION CONTRACTOR FROM WHICH THE CASH PAYMENTS WERE MADE. IN THE CO URSE OF SUBMISSIONS MADE BEFORE THE CIT(A) ALSO WHICH ARE RECORDED IN PARAGRAPH 4.6 OF HIS ORDER THE ASSESSEE HAD SUBMITTED THAT THE SOURCE O F THE CASH PAYMENTS WAS EXPLAINABLE AS COMING OUT OF THE MONIES RECEIVE D FROM THE DEMOLITION CONTRACTOR. HOWEVER IN THE ABSENCE OF ANY EVIDENC E THE CIT(A) DID NOT ACCEPT THE PLEA. THE EVIDENCE IS NOW AVAILABLE AND ACCORDING TO THE AFFIDAVIT IT COULD NOT BE ADDUCED BEFORE THE DEPART MENTAL AUTHORITIES ONLY BECAUSE OF THE DISPUTES BETWEEN THE PERSONS HAVING CONTROL OVER THE ASSESSEE-COMPANY AND ASSOCIATE CONCERNS. I HAVE NO REASON TO DISBELIEVE THE AFFIDAVIT. IN THE INTERESTS OF JUST ICE THEREFORE I ADMIT THE ADDITIONAL EVIDENCE UNDER RULE 29 OF THE TRIBUNAL R ULES AND RESTORE THE SAME TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO HIM TO EXAMINE AND VERIFY THE SAME AND TAKE A FRESH DECISI ON ON THE ASSESSEES CLAIM IN ACCORDANCE WITH LAW. NEEDLESS TO ADD THAT THE ASSESSEE SHALL BE ITA NO. 2755 AND 2757/MUM/2009 (ASSESSMENT YEARS: 2004-05 AND 2005-06) 4 GIVEN DUE OPPORTUNITY OF BEING HEARD. I DIRECT ACC ORDINGLY AND ALLOW THE APPEALS OF THE ASSESSEE FOR STATISTICAL PURPOSES WI TH NO ORDER AS TO COSTS . ORDER PRONOUNCED IN THE OPEN COURT ON 26 TH DAY OF MARCH 2010. SD ( R V EASWAR ) SENIOR VICE PRESIDENT MUMBAI DATED 26TH MARCH 2010 SRL:25310 COPY TO: 1. M/S GRAND LIVING (INDIA) PVT.LTD. 53 HAJI MAHAL MOHAMMED ALI ROAD MUMBAI. 2. ACIT CENTRAL CIRCLE 45 AYAKAR BHAVAN M K ROAD MUMBAI-400020 3. CIT- I 4. CIT(A)- CENTRAL -III MUMBAI 5. DR SMC BENCH TRUE COPY BY ORDER ASSTT. 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