SHAKEEL M. OSMAN, MUMBAI v. DY CIT 13(1), MUMBAI

ITA 3396/MUM/2008 | 1997-1998
Pronouncement Date: 10-03-2010 | Result: Allowed

Appeal Details

RSA Number 339619914 RSA 2008
Bench Mumbai
Appeal Number ITA 3396/MUM/2008
Duration Of Justice 1 year(s) 9 month(s) 26 day(s)
Appellant SHAKEEL M. OSMAN, MUMBAI
Respondent DY CIT 13(1), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 10-03-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted J
Tribunal Order Date 10-03-2010
Date Of Final Hearing 03-03-2010
Next Hearing Date 03-03-2010
Assessment Year 1997-1998
Appeal Filed On 15-05-2008
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH J MUMBAI BEFORE SHRI PRAMOD KUMAR AM & SMT. P.MADHAVI DEVI JM I.T.A.NO.3396/MUM/2008 - A.Y 1997-98 MR. SHAKEEL M. OSMAN 20 SAFEENA PATEL COMPOUND NEPEANSEA ROAD MUMBAI 400 036 PAN NO.AAAPD 1084 E VS. DY. COMMISSIONER OF I.T. 13(1) MUMBAI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI N.S.PORWAL. REVENUE BY : SHRI L.K.AGARWAL. O R D E R PER P.MADHAVI DEVI JM: THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST CI T(A)S ORDER DATED 8/2/2008 FOR A.Y 1997-98. 2. THE ONLY GRIEVANCE OF THE ASSESSEE IN THIS APPEA L IS AGAINST THE ORDER OF THE CIT[A] CONFIRMING ADDITION OF RS.7 89 000/- U/S.68 OF THE INCOME TAX ACT. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE I S AN INDIVIDUAL. A SURVEY WAS CONDUCTED AT THE BUSINESS PREMISES OF TH E ASSESSEE ON 17-10-06 DURING WHICH A BANK A/C. NO.250708 WITH HD FC BANK WARDEN ROAD BRANCH WAS FOUND. IT WAS FOUND THAT THE BANK ACCOUNT WAS OPENED IN THE NAME OF THE ASSESSEE I.E. SHRI SH AKEEL OSMAN AND HIS WIFE MRS. NAZIA M. OSMAN AND THERE WERE CASH DE POSITS TO THE TUNE OF RS.7 89 000/- FROM 4-5-1996 TO 4-10-1996. A STAT EMENT OF THE ASSESSEE WAS ALSO RECORDED DURING THE COURSE OF SUR VEY WHEREIN HE 2 SUBMITTED THAT AN AMOUNT OF RS.3 30 000/- WAS AN AD VANCE RECEIPT AGAINST THE EXPORT ORDER RECEIVED FROM TANZANIA AND THE BALANCE AMOUNT IS DEPOSITED OUT OF WITHDRAWALS FROM M/S NOO RMOHAMMED INTERIORS PVT. LTD. IT WAS ALSO STATED THAT THE CAS H BOOK OF M/S NOORMOHAMMED INTERIORS PVT. LTD. WAS NOT WRITTEN S O FAR. DEPOSITS OF RS.11 36 000/- WERE ALSO FOUND IN ANOTHER BANK ACCO UNT MAINTAINED WITH UNION BANK OF INDIA AND THE ASSESSEE COULD NOT EXPLAIN THE DEPOSIT OF RS.5 50 000/-. THE ASSESSEE THEREFORE OFFERED RS.6 00 000/- FOR TAXATION DURING THE COURSE OF SUR VEY. HOWEVER ASSESSEE FILED RETURN OF INCOME ON 28-11-1997 DECLA RING THE TOTAL INCOME OF RS.55 850/- ONLY AND THERE WAS NO MENTION OF THE DECLARATION OF RS.6 00 000/- MADE DURING THE COURSE OF SURVEY. AO THEREFORE CALLED FOR THE ASSESSEES EXPLANATION. T HE ASSESSEE VIDE LETTER DATED 15-3-2000 SUBMITTED THAT A/C.NO.250708 WITH HDFC BANK BELONGED TO M/S NOORMOHAMMED INTERIORS PVT. LTD. A ND THAT HE AGREED TO SURRENDER RS.5 50 000/- AS THE ITO CONDUC TING THE SURVEY WANTED TO DECLARE SOME AMOUNT TO JUSTIFY THE SURVEY . HOWEVER AO WAS NOT CONVINCED WITH THE ASSESSEES EXPLANATION A ND TREATED THE AMOUNT OF RS.7 89 000/- AS UNEXPLAINED CASH CREDITS . 4. AGGRIEVED ASSESSEE FILED AN APPEAL BEFORE THE C IT[A] REITERATING THE SUBMISSIONS MADE BEFORE THE AO. BUT THE CIT[A] CONFIRMED THE ORDER OF THE AO AND AGGRIEVED ASSESSE E FILED AN APPEAL BEFORE THE TRIBUNAL. THE TRIBUNAL VIDE ORDERS DATED 24-2-2005 OBSERVED THAT IT IS NECESSARY TO EXAMINE THE NATURE AND SOURCE OF 3 DEPOSITS IN THE SAID BANK AND THEREAFTER TO DETERMI NE WHETHER THOSE DEPOSITS BELONGED TO THE ASSESSEE IN HIS INDIVIDUAL CAPACITY OR PERTAINED TO THE SAID COMPANY. SINCE INVESTIGATIONS REQUIRED EXAMINING THE FACTS AND APPRECIATING THE SAME THE TRIBUNAL R EMANDED THE MATTER TO THE FILE OF THE AO WITH A DIRECTION TO EXAMINE T HE ISSUE AFRESH AND ALSO TO VERIFY THE ACCOUNTS OF THE ASSESSEE AS WELL AS THE ACCOUNTS OF THE SAID COMPANY. WHILE GIVING EFFECT TO THE ORDER OF THE TRIBUNAL AO RE-APPRECIATED THE EVIDENCE FILED BEFORE HIM AND CA ME TO THE CONCLUSION THAT THERE WAS NO DOCUMENTARY OR ANY OTH ER CIRCUMSTANTIAL EVIDENCE TO PROVE THE CONTENTIONS OF THE ASSESSEE T HAT THE CASH FOUND AT THE TIME OF SURVEY OPERATION PERTAINED TO M/S NO ORMOHAMMED INTERIORS PVT. LTD. AND ALSO THAT M/S NOORMOHAMMED INTERIORS PVT. LTD. ALREADY HAD A BANK ACCOUNT IN BANK OF BARODA CRAWFORD MARKET BRANCH WHICH WAS IN OPERATION AT THE TIME OF SURVE Y AND HENCE THERE WAS NO PROBABLE REASON FOR TAKING CASH ON BEHALF O F THE COMPANY TO BE DEPOSITED IN THE BANK ACCOUNT OF THE COMPANY. TH US HE MADE ADDITION OF RS.7 89 000/- U/S.68 OF THE ACT. 5. AGGRIEVED ASSESSEE AGAIN WENT IN APPEAL BEFORE T HE CIT[A] WHO CONFIRMED THE ORDER OF THE AO AND THE ASSESSEE IS IN SECOND APPEAL BEFORE US IN SECOND ROUND OF LITIGATION. 6. THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW WHILE THE LD. DR SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 4 7. HAVING HEARD BOTH THE PARTIES AND HAVING CONSID ERED THEIR RIVAL CONTENTIONS AND ALSO THE MATERIAL PLACED ON RECORD WE FIND THAT RIGHT FROM THE DATE OF SURVEY ASSESSEES CONTENTION HAS BEEN THAT AN AMOUNT OF RS.3.30 LAKHS WAS AN ADVANCE RECEIPT AGAI NST THE EXPORT ORDER RECEIVED FROM TANZANIA AND THE BALANCE AMOUNT BELONGED TO M/S NOORMOHAMMED INTERIORS PVT. LTD. ONE OF THE REASONS FOR THE AO FOR NOT ACCEPTING THE SAID CONTENTION IS THAT THE CASH BOOK OF THE SAID COMPANY I.E. M/S NOORMOHAMMED INTERIORS PVT. LTD. W AS NOT PREPARED AS ON THE DATE OF SURVEY. THE TRIBUNAL IN ITS ORDER DATED 25-2-2005 HAD DIRECTED THE AO TO VERIFY THE NATURE AND SOURCE OF THE DEPOSITS AND ALSO THE BOOKS OF ACCOUNTS OF THE ASSESSEE AS WELL AS THE COMPANY I.E. M/S NOORMOHAMMED INTERIORS PVT. LTD. NEITHER THE A O NOR THE CIT[A] HAS DONE THIS EXERCISE. EVEN IN REMAND PROCEEDINGS AO HAS NOT CONSIDERED THE BOOKS OF THE COMPANY ON THE GROUND T HAT THEY WERE NOT AVAILABLE AT THE TIME OF SURVEY. THIS FACT ALON E CANNOT BE A BASIS FOR THE PRESUMPTION THAT THE BOOKS OF ACCOUNTS ARE INCORRECT OR ARE NOT RELIABLE. IT IS ADMITTED BY THE AO THAT THE BOOKS O F ACCOUNTS OF THE COMPANY ARE AUDITED. IN SUCH A CASE THE AO COULD H AVE VERIFIED WHETHER THE ENTRIES IN THE BOOKS OF ACCOUNTS ARE SU PPORTED BY NECESSARY EVIDENCE. THE AO HAS FAILED TO DO SO. IT ALSO NOT KNOWN AS TO WHAT HAPPENED IN THE CASE OF THE COMPANY WHETHE R THE SAID ENTRIES WERE ACCEPTED OR NOT DURING THE RELEVANT ASSESSMENT YEAR. THEREFORE IN OUR OPINION THE AO AND THE CIT[A] HAVE NOT PRO PERLY APPRECIATED THE EVIDENCE AS DIRECTED BY THE TRIBUNAL. IN VIEW O F THE SAME WE 5 DEEM IT FIT AND PROPER TO REMIT THE ISSUE TO THE FI LE OF THE AO WITH A DIRECTION TO RECONSIDER THE SAME IN THE LIGHT OF TH E BOOKS OF ACCOUNTS OF THE ASSESSEE AND ALSO THE COMPANY AND IF THE ENT RIES ARE FOUND TO BE DULY ENTERED INTO THE BOOKS OF ACCOUNTS OF THE C OMPANY THEN TO DELETE THE ADDITION MADE IN THE HANDS OF THE ASSESS EE. FURTHER THE ASSESSEES CONTENTION ABOUT THE RECEIPT OF RS.3.30 LAKHS AS ADVANCE FOR AN EXPORT ORDER ALSO HAS NOT BEEN VERIFIED BY THE A UTHORITIES. AO IS DIRECTED TO VERIFY THE SAME AND ALLOW IT IF FOUND T O BE CORRECT. ACCORDINGLY THE GROUND OF APPEAL RAISED BY THE ASS ESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 8. IN THE RESULT ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THIS 10 TH DAY OF MARCH 2010. SD/- SD/- (PRAMOD KUMAR) (P.MADHAVI DEVI) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI: 10 TH MARCH 2010. P/-*