Shri Manilal Ravishankar Joshi, Ahmedabad v. The Dy.CIT.,Circle-10,, Ahmedabad

ITA 2929/AHD/2010 | 2003-2004
Pronouncement Date: 11-03-2011 | Result: Partly Allowed

Appeal Details

RSA Number 292920514 RSA 2010
Assessee PAN AAGPJ7954G
Bench Ahmedabad
Appeal Number ITA 2929/AHD/2010
Duration Of Justice 4 month(s) 17 day(s)
Appellant Shri Manilal Ravishankar Joshi, Ahmedabad
Respondent The Dy.CIT.,Circle-10,, Ahmedabad
Appeal Type Income Tax Appeal
Pronouncement Date 11-03-2011
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted SMC
Tribunal Order Date 11-03-2011
Date Of Final Hearing 09-03-2011
Next Hearing Date 09-03-2011
Assessment Year 2003-2004
Appeal Filed On 25-10-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL : SMC BENCH : AHMEDABAD (BEFORE HONBLE SHR I T.K. SHARMA J.M .) I.T.A. NO. 2929/AHD./2010 ASSESSMENT YEAR : 2003-2004 SHRI MANILAL RAVISHANKAR JOSHI AHMEDABAD -VS- DCIT CIRCLE-10 AHMEDABAD (PAN : AAGPJ 7954G) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI PAMIL R. SHAH A .R. RESPONDENT BY : SHRI VIMALENDU VERMA D .R. O R D E R THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE O RDER DATED 05.04.2010 PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-XVI A HMEDABAD FOR THE ASSESSMENT YEAR 2003-2004. 2. BRIEFLY STATED THE FACTS ARE THAT IN THIS CASE THE ORIGINAL ASSESSMENT WAS COMPLETED ON 14.3.2006 DETERMINING TOTAL INCOME AT RS.4 89 750/- . IN THIS ASSESSMENT ORDER THE ASSESSING OFFICER MADE ADDITION OF RS.3 LAKHS ON ACCOUNT OF N ON-GENUINE GIFT CREDITED IN THE CAPITAL ACCOUNT OF THE ASSESSEE. THE LEARNED COMMISSIONER O F INCOME TAX(APPEALS) VIDE ORDER DATED 30.11.2006 DISMISSED THE APPEAL OF THE ASSESSEE. O N FURTHER APPEAL ITAT SMC BENCH AHEMEDABAD VIDE ORDER DATED 21.03.2007 REMANDED T HE ADDITION OF RS.3 LAKHS TO THE FILE OF THE ASSESSING OFFICER TO DECIDE THE ISSUE AFRESH AFTER GIVING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 2.1 IN ORDER TO GIVE EFFECT TO THE ORDER OF THE ITA T SMC BENCH AHMEDABAD DATED 21.03.2007 THE ASSESSING OFFICER FRAMED THE ASSESS MENT UNDER SECTION 143(3) READ WITH SECTION 254 ON 31.12.2008 WHEREIN THE ASSESSING OFFICER ISS UED A SUMMON UNDER SECTION 131 TO DONOR ON 23.10.2007 FOR PERSONAL ATTENDANCE AND TO REMAIN PRESENT ON 02.11.2007. THE DONOR NAMELY SHRI DHIREN RAMANLAL SHAH DID NOT RESPOND AND DID N OT REMAIN PRESENT BEFORE THE ASSESSING 2 ITA NO. 2929-AHD-2010 OFFICER. THEREAFTER THE ASSESSING OFFICER INTIMATE D ABOUT THE NON-COMPLIANCE OF SUMMON AND ALSO ISSUED NOTICE FOR LEVY OF PENALTY FOR NON-COMP LIANCE. IN RESPONSE TO THIS PENALTY NOTICE A SET OF PAPERS WHICH WAS SUBMITTED EARLIER WAS SUBMITT ED AND PERSONAL ATTENDANCE WAS AVOIDED IN ORDER TO AVOID HIS EXAMINATION ON OATH. THEREAFTER THE ASSESSING OFFICER FOR THE DETAILED REASONS GIVEN IN PARA 3 AND 4 IN THE ASSESSMENT ORD ER MADE AN ADDITION OF RS.3 LAKHS UNDER SECTION 68 OF THE I.T. ACT. THE PARA NOS. 3 AND 4 A RE REPRODUCED HEREIN. 3. FACTS OF THE CASE: DURING THE COURSE OF ASSESS MENT PROCEEDINGS ON VERIFICATION OF THE CAPITAL ACCOUNT OF THE ASSESSEE IT WAS NOTICED TH AT A SUM OF RS.1 25 000/-AND RS.1 75 000/- WERE CREDITED ON 13/2/2003 AND 22/2/ 2003. THE NARRATION IN RESPECT OF THESE ENTRIES IN THE CAPITAL ACCOUNT ENCLOSED WITH THE RETURN OF INCOME IS 'GIFT BY MALUBHAI PAY ORDER NO.009484 & 009889 THE KALUPUR COMRCIAL BANK.' THE ASSESSEE WAS ASKED TO FURNISH COMPLETE DETAILS OF SHRI MALUBHAI FROM WHOM GIFT RECEIVED VIDE NOTICE U/S. 142(1) OF THE ACT. IN RE SPONSE THERETO THE ASSESSEE STATED THAT GIFTS WAS RECEIVED FROM DHIREN RAMANLAL SHAH (ALSO KNOWN AS MALUBHAI ) AND FILED COPY OF TWO GIFT DEEDS. THE STAMP PAPERS USED IN PREPAR ING GIFT DEEDS WERE PURCHASED BY NOMINEE NAMELY HITESH PANCHAL ON BEHALF OF THE ASS ESSEE ON 21/7/2003 I.E. FIVE MONTHS AFTER THE TRANSACTION. THE DETAILS OF PAY ORDERS BANK ACCOUNT OF THE DONOR AND OTHER DETAILS WERE CALLED FOR FROM THE BANK. ON EXAMINAT ION OF THE SAME IT WAS NOTICED THAT JUST ON THE DATE OF ISSUANCE OF PAY ORDER EQUIVAL ENT CASH WAS DEPOSITED IN THE BANK ACCOUNT. THE DONOR WAS ALSO REQUIRED U/S. 131 OF T HE ACT TO REMAIN PRESENT BEFORE THE ASSESSING OFFICER FOR EXAMINATION. THE DONOR AVOID ED TO REMAIN PRESENT AND SEND THE RELATED PAPERS THE ASSESSEE WAS GIVEN AN OPPORTUNI TY TO EXPLAIN GENUINENESS OF THE GIFTS BY ESTABLISHING CREDITWORTHINESS OF THE DONOR AND RELATIONSHIP WITH THE DONOR. THE ASSESSEE REITERATED HIS EARLIER SUBMISSION. CONSID ERING THE FACTS AND CIRCUMSTANCES OF THE CASE IT WAS HELD THAT IT WAS NOT A GENUINE GIFTS AND A SUM OF RS.3 00 000/- WAS TREATED AS UNEXPLAINED CREDIT U/S.68 OF THE ACT. RELIANCE IS PLACED ON THE DECISION OF HONORABLE ITAT AHMEDABAD IN THE CASE OF ITO VS JAGDISH J. K ANSAGARA ( 1993) 066 1TD 0381(AHD). 4 IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE CONSIDERING THE ABSOLUTE NON- RESPONSIVENESS OF THE DONOR AND INABILITY OF THE A SSESSEE TO PRODUCE THE DONOR AND TO PROVE GENUINENESS OF HIS CLAIM OF SIFT OF RS. 3 00 .000/- THE SAID AMOUNT IS TREATED AS UNEXPLAINED CREDIT U/S.68 OF THE ACT AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 3. ON APPEAL BEFORE THE LEARNED COMMISSIONER OF INC OME TAX(APPEALS) THE ASSESSEE FILED WRITTEN SUBMISSION. THE LEARNED COMMISSIONER OF INC OME TAX(APPEALS) FORWARDED THE SAME TO THE ASSESSING OFFICER FOR HIS COMMENTS. THE COMMENT S OF THE ASSESSING OFFICER WERE ALSO HANDED OVER TO THE ASSESSEE FOR HIS COMMENTS. AFTER CONSIDERING THE COMMENTS OF BOTH SIDES THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) UPHELD THE ACTION OF THE ASSESSING OFFICER BY OBSERVING THAT THIS ISSUE WAS SET ASIDE BY THE ITAT TO THE FILE OF THE ASSESSING OFFICER WITH A 3 ITA NO. 2929-AHD-2010 DIRECTION TO GIVE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. MORE THAN SUFFICIENT OPPORTUNITIES WERE GIVEN BY THE ASSESSING OFFICER IN REMAND PROCE EDINGS. THE ASSESSEE AS WELL AS HIS COUNSEL COULD NOT PRODUCE THE DONOR BEFORE THE ASSESSING OF FICER. THIS CLEARLY PROVES THAT THE GIFT FROM SHRI DHIREN RAMANLAL SHAH IS NOT GENUINE. HE ACCOR DINGLY HELD THAT THE ASSESSEE HAS MISERABLY FAILED TO PROVE EVEN THE IDENTITY CREDITWORTHINESS AND GENUINENESS OF GIFT. THEREFORE HE CONFIRMED THE ADDITION OF RS. 3 LAKHS. 4. AGGRIEVED WITH THIS ORDER THE ASSESSEE IS IN AP PEAL BEFORE THE TRIBUNAL. 5. AT THE TIME OF HEARING SHRI PAMIL R. SHAH A.R. APPEARED ON BEHALF OF THE ASSESSEE AND POINTED OUT THAT THE ASSESSMENT FRAMED BY THE ASSES SING OFFICER IS BARRED BY LIMITATION. TO THIS THE LD. D.R. POINTED OUT THAT THE ORDER PASSED BY T HE ASSESSING OFFICER ON 31.12.2008 WAS TO EXAMINE ONLY ONE ISSUE. THE D.R. SUBMITTED THAT THI S IS NOT AN ASSESSMENT. THEREFORE LIMITATION IS NOT APPLICABLE. ON MERIT COUNSEL OF THE ASSESSE E SUBMITTED THAT THE ASSESSEE HAS FURNISHED THE COPY OF BANK ACCOUNT AND THE GIFT WAS RECEIVED THRO UGH ACCOUNT PAYEE CHEQUE. THEREFORE GENUINENESS AS WELL AS CREDITWORTHINESS OF THE DONO R ARE PROVED. SHRI VIMALENDU VERMA LD. D.R. DREW OUR ATTENTION TO THE DIRECTION OF THE TRI BUNAL WHEREBY THE ASSESSEE WAS DIRECTED TO PRODUCE THE DONOR. ADMITTEDLY THE DONOR WAS NEVER PRODUCED BEFORE THE ASSESSING OFFICER. THEREFORE THE VIEW TAKEN BY THE LEARNED COMMISSION ER OF INCOME TAX(APPEALS) CONFIRMING THE ADDITION OF RS. 3 LAKHS BE UPHELD. 6. AFTER HEARING BOTH THE SIDES I HAVE CAREFULLY G ONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. IT IS PERTINENT TO NOTE THAT LEARNED COMMISS IONER OF INCOME TAX(APPEALS) FOR THE DETAILED REASONS GIVEN IN PARA 10.1 HELD THAT ASS ESSMENT FRAMED IS NOT BARRED BY LIMITATION. THE SAID PARA IS REPRODUCED HEREUNDER: AS REGARDS THE DEMAND NOTICE I HAVE SEEN THE SOME . IN THE DEMAND NOTICE THE DATE IS MENTIONED AS 31-12-200S / 23-1-2009 AND NOT 31-12- 2008 / 21-1-2009 AS STATED BY THE APPELLANT BEFORE ME ON 25-9-2009. IT IS ACCEPTED B Y THE AUTHORISED REPRESENTATIVE THAT THE DEMAND NOTICE AND THE ASSESSMENT ORDER WERE SE RVED ON HIM ON 22-1-2009 ACCORDING TO HIM SINCE THE DEMAND NOTICE IS PREPA RED ON 23-1-2009 THE ORDER IS TIME BARRED. F DO NOT AGREE WITH THE AUTHORISED REPRESE NTATIVE. IF THE DEMAND NOTICE WAS PREPARED ON 23-1-2009 THEN HOW COULD THE ASSESSEE RECEIVE THE ASSESSMENT ORDER ON 22- 1-2009. IT IS NOT DISPUTED THAT THE APPELLANT RECE IVED THE ASSESSMENT ORDER ALONGWITH THE DEMAND NOTICE ON 22-1-2009. THEREFORE THERE IS NO RELEVANCE OF DATES MENTIONED IN THE DEMAND NOTICE AS 23-1-2009 BECAUSE BEFORE THIS DAT E THE APPELLANT PHYSICALLY RECEIVED 4 ITA NO. 2929-AHD-2010 THE ASSESSMENT ORDER AS WELL DEMAND NOTICE. THEREF ORE THIS GROUND OF THE APPELLANT THAT THE ASSESSMENT ORDER IS TIME BARRED IS NOT CORRECT . 6.1 IN MY CONSIDERED OPINION THE LEARNED COMMISSIO NER OF INCOME TAX(APPEALS) HAS GIVEN COGENT REASON FOR HOLDING THAT ASSESSMENT ORDER IS NOT BARRED BY LIMITATION IS CORRECT. I THEREFORE HOLD THAT THIS PLEA WAS RIGHTLY REJECTED BY THE LEA RNED COMMISSIONER OF INCOME TAX(APPEALS). 6.2 COMING TO THE MERITS IT IS PERTINENT TO NOTE T HAT THE ASSESSING OFFICER HAS ALLOWED SUFFICIENT OPPORTUNITY TO PRODUCE THE DONOR. NEITHE R DURING THE COURSE OF ORIGINAL PROCEEDINGS OR SET ASIDE PROCEEDINGS OR IN REMAND PROCEEDINGS THE ASSESSEE COULD PRODUCE THE DONOR BEFORE THE ASSESSING OFFICER OR BEFORE THE LEARNED COMMISSIONE R OF INCOME TAX(APPEALS). IT WAS MANDATORY FOR THE ASSESSEE TO COMPLY WITH THE DIREC TION OF THE ITAT SMC BENCH AHMEDABAD DATED 21.03.2007. SINCE MORE THAN SUFFICIENT OPPORT UNITIES WERE GIVEN BY THE ASSESSING OFFICER IN THE REMAND PROCEEDINGS THE INABILITY OF THE ASS ESSEE AND HIS A.R. TO PRODUCE THE DONOR BEFORE THE ASSESSING OFFICER CLEARLY PROVES THAT THE GIFT FROM SHRI DHIREN RAMANLAL SHAH IS NOT GENUINE. I AM THEREFORE OF THE VIEW THAT THE VIEW TAKEN BY THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) IN THIS REGARD IS FAIR AND REASONABL E. I THEREFORE DECLINE TO INTERFERE. 7. IN THE RESULT FOR STATISTICAL PURPOSES THE APP EAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE COURT ON 11.03.20 11. SD/- (T.K. SHARMA) JUDICIAL MEMBER DATED : 11/03/2011 COPY OF THE ORDER IS FORWARDED TO : 1) THE ASSESSEE 2) THE DEPARTMENT. 3) CIT(A.) CONCERNED 4) CIT CONCERNED 5) D.R. ITAT AHMEDABAD. TRUE COPY` BY ORDER DEPUTY REGI STRAR ITAT AHMEDABAD TALUKDAR/SR.P.S. 5 ITA NO. 2929-AHD-2010