SAYERMAL JAIN, MUMBAI v. DCIT (OSD) II CEN RG VII, MUMBAI

ITA 3402/MUM/2009 | 1998-1999
Pronouncement Date: 22-07-2011 | Result: Allowed

Appeal Details

RSA Number 340219914 RSA 2009
Assessee PAN ABOPJ4136H
Bench Mumbai
Appeal Number ITA 3402/MUM/2009
Duration Of Justice 2 year(s) 1 month(s) 27 day(s)
Appellant SAYERMAL JAIN, MUMBAI
Respondent DCIT (OSD) II CEN RG VII, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 22-07-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted E
Tribunal Order Date 22-07-2011
Date Of Final Hearing 16-05-2011
Next Hearing Date 16-05-2011
Assessment Year 1998-1999
Appeal Filed On 25-05-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH MUMBAI. BEFORE SHRI PRAMOD KUMAR ACCOUNTANT MEMBER AND SHRI V. DURGA RAO JUDICIAL MEMBER I.T.A NO.3402/ MUM/2009 ASSESSMENT YEAR: 1998-99 SH. SAYERMAL JAIN .. APPELLANT 13A DURGADAS BUILDING ARDHESIR DADAY X LANE MUMBAI-400 004 PA NO.ABOPJ 4136 H VS DCIT(OSD)-II CENTRAL RANGE . RESPONDEN T VII MUMBAI. APPEARANCES: V.K.TULSIAN FOR THE APPELLANT K.RAVIKIRAN FOR THE RESPONDENT O R D E R PER PRAMOD KUMAR: 1. BY WAY OF THIS APPEAL THE ASSESSEE-APPELLANT HAS CALL ED INTO QUESTION CORRECTNESS OF CIT(A)S ORDER DATED 26.3.2009 PASSED BY THE CIT(A) UNDER SECTION 250 R.W.S. 154 OF THE INCOME TAX ACT 1961 SEEKING T O RECTIFY HIS PREDECESSORS ORDER DATED 31.1.2005 FOR THE ASSESSMENT YEAR 1998-99. 2. THE GRIEVANCES OF THE ASSESSEE ARE AS FOLLOWS: 1. WHETHER THE CIT(A) IS JUSTIFIED BY RECTIFYING HIS ALLOWED APPELLATE ORDER DT.31.1.2005 U/S.154 JUST BY SUO-MOTO APPLYING THE HON BLE TRIBUNALS ORDER ON BLOCK PERIOD DT.30.9.08. 2. WHETHER THE CI(A) IS JUSTIFIED TO DRAW AN ADVERSE R EFERENCE IN PURSUANCE OF THE HONBLE TRIBUNALS ORDER DT.30.9.08 IN WHICH THE HONBLE TRIBUNAL NEVER SAYS AS PRESUMED BY THE CIT(A). I.T.A NO.3402/ MUM/2009 ASSESSMENT YEAR: 1998-99 2 3. WHETHER THE CIT(A) IS JUSTIFIED BY NOT AFFORDING A REASONABLE OPPORTUNITY ALTHOUGH THE REQUIREMENTS WERE COMPLIED WITH BY LETT ER DT.23.3.09 SENT THROUGH COURIER. WITHOUT PREJUDICE: 4. WHETHER THE CIT(A) IS JUSTIFIED TO EXERCISE THE JUR ISDICTION WHICH IS EXCLUSIVELY EITHER CIT(A)S OR AOS EVEN IF SOMETHING A DVERSE ARISES FROM THE DIFFERENT LEGAL FORUM APPELLATE ORDER. 3. BRIEFLY STATED THE RELEVANT MATERIAL FACTS ARE LIK E THIS. A COORDINATE BENCH OF THIS TRIBUNAL WHILE ADJUDICATING UPON THE CROSS APPEAL S IN THE MATTER OF BLOCK ASSESSMENT FOR THE PERIOD ENDING 4.3.1999 IN THE CASE OF THIS ASSESSEE VIDE ORDER DATED 30.9.2008 INTER ALIA OBSERVED AS FOLLOWS: IN REGARD TO THE ADDITION ON ACCOUNT OF CASH CREDI TS WE FIND THAT THE ASSESSING OFFICER HAS MADE SEPARATE ADDITIONS IN REGULAR ASSE SSMENT. ONCE THE ADDITION HAS BEEN MADE IN REGULAR ASSESSMENT THERE IS NO JU STIFICATION FOR MAKING THE SAME ADDITION IN THE BLOCK ASSESSMENT. THE ASSESSEE IS A REGULAR TAX PAYER AND HAD FILED THE RETURN FOR THE RESPECTIVE ASSESSMENT YEARS. IN REGULAR ASSESSMENT THE ADDITIONS HAVE BEEN MADE AND THEREFORE THERE WAS NO SCOPE FOR ADDITIONS IN THE BLOCK ASSESSMENT FOR THE SAME AMOUNTS. WHER EAS THE CIT(A) WAS JUSTIFIED IN DELETING THE ADDITIONS MADE IN THE HAN DS OF THE ASSESSEE ON PROTECTIVE BASIS HE WAS NOT IN OUR VIEW JUSTIFIE D IN SUSTAINING THE ADDITION ON ACCOUNT OF UNEXPLAINED DEPOSITS IN THE BANK ACCOUNT S WHEN THE ADDITION IN RESPECT OF SUCH AMOUNTS HAD BEEN MADE IN THE REGULA R ASSESSMENT. WITHOUT GOING INTO THE MERITS OF THE ADDITIONS IN REGULAR A SSESSMENT WE HOLD THAT THE ADDITION ON ACCOUNT OF CASH CREDITS NOT BASED ON A NY MATERIAL FOUND IN THE COURSE OF THE SEARCH IS NOT JUSTIFIED IN THE CASE OF BLOCK ASSESSMENT. WE ACCORDINGLY DELETE THE ADDITION OF ` .37 15 000 FOR THE ASSESSMENT YEAR 1998-99 AND ` .4 50 000 FOR THE ASSESSMENT YEAR 1999-2000. 4. BASED ON THE ABOVE OBSERVATIONS THE CIT(A) SOUGHT T O RECTIFY HIS PREDECESSORS ORDER IN THE MATTER OF REGULAR ASSESSMENT FO R THE ASSESSMENT YEAR 1998-99 BY OBSERVING AS FOLLOWS:- APPEAL IN THE ABOVE CASE WAS PASSED VIDE ORDER DT.3 1.1.2005. IN THIS ORDER WHILE DECIDING THE ADDITION OF ` .40 15 000 MADE ON PROTECTIVE BASIS ON ACCOUNT OF UNEXPLAINED CREDITS IN THE BANK ACCOUNTS THE AD DITION WAS DELETED BECAUSE THEY HAD BEEN CONFIRMED IN THE ASSESSMENT ORDER FOR THE BLOCK PERIOD. SUBSEQUENTLY VIDE ITS ORDER DTD.30.9.2008 THE HON BLE ITAT B BENCH MUMBAI HAS FORMED A VIEW THAT THIS ADDITION CANNOT BE MADE IN THE BLOCK ASSESSMENT AND THAT IT SHOULD BE MADE IN THE REGULAR ASSESSMEN T. IN VIEW OF THIS THE I.T.A NO.3402/ MUM/2009 ASSESSMENT YEAR: 1998-99 3 APPEAL ORDER DTD.31.1.2005 DELETING THE ADDITION RE QUIRES RECTIFICATION. ACCORDINGLY VIDE LETTER DT.20.3.2009 NOTICE U/S.1 54 WAS ISSUED TO THE APPELLANT TO GIVE HIM AN OPPORTUNITY TO PRESENT HIS VERSION I N THE MATTER. THE CIRCUMSTANCES REQUIRING THE RECTIFICATION WERE ALSO EXPLAINED IN DETAIL IN THE LETTER. THE APPELLANT WAS REQUESTED TO SUBMIT HIS VERSION EITHER IN WRITING OR BY PERSONAL ATTENDANCE OR THROUGH AN AUTHORIZED REPRES ENTATIVE. THE VERSION IN WRITING WAS CALLED FOR LATEST BY 25.3.2009 AND IN C ASE OF PERSONAL ATTENDANCE OR ATTENDANCE BY AN AUTHORIZED REPRESENTATIVE HEARING WAS FIXED ON 25.3.2009 AT 11.00 AM. THERE WAS NO RESPONSE TO THIS NOTICE EIT HER IN WRITING OR BY PERSONAL ATTENDANCE OR THROUGH AUTHORIZED REPRESENTATIVE. I N VIEW OF THIS IT IS PRESUMED THAT THE APPELLANT HAS NOTHING TO PRESENT IN THE MATTER. ACCORDINGLY IN THE LIGHT OF THE ORDER DT.30.9.2008 OF THE HONB LE ITAT THE DELETION OF THE ADDITION OF ` .40 15 000 MADE IN THE APPEAL ORDER DT. 31.1.2005 I S WITHDRAWN. THE ADDITION IS NOW CONFIRMED. THE ORDER DTD.31.1. 2005 STANDS MODIFIED TO THIS EXTENT. 5. THE ASSESSEE IS AGGRIEVED AND IS IN APPEAL BEFORE US. 6. WE HAVE HEARD THE RIVAL CONTENTIONS PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTUAL MATRIX OF THE CASE AS ALSO THE APPLI CABLE LEGAL POSITION. 7. A PLAIN READING OF THE ORDER DATED 30.9.2008 PASSE D BY A COORDINATE BENCH IN ASSESSEES OWN CASE RELATING TO BLOCK ASSESSMENT SHOWS THAT THE TRIBUNAL HAS NOT GIVEN ANY CATEGORICAL FINDINGS AS TO WHETHER OR NOT THIS ADDITION DESERVES TO BE ADDED IN THE HANDS OF THE ASSESSEE DURING REGULAR ASSESSMEN T PROCEEDINGS. AS A MATTER OF FACT THE COORDINATE BENCH HAS CATEGORICA LLY OBSERVED THAT . WITHOUT GOING INTO THE MERITS OF THE ADDITIONS IN REGULAR ASSESSM ENT WE HOLD THAT THE ADDITION ON ACCOUNT OF CASH CREDITS NOT BASED ON ANY MATERIAL FOUND IN THE COURSE OF THE SEARCH IS NOT JUSTIFIED IN THE CASE OF BLOCK ASSESSMENT IN THIS VIEW OF THE MATTER BY NO STRETCH OF LOGIC THE OBSERVATIONS MADE BY THE TRIBUNAL CAN B E SEEN TO POINT OUT THAT THE ADDITIONS SO DELETED BY THE TRIBUNAL IN THE BLOCK ASSESSM ENT PROCEEDINGS WERE REQUIRED ON MERITS TO BE ADDED IN THE REGULAR ASSESSME NT PROCEEDINGS. AT THE COST OF REPETITION WE MAY POINT OUT THAT THERE ARE NO F INDINGS BY THE TRIBUNAL TO THE EFFECT THAT WHAT HAS BEEN DELETED IN THE COURSE OF BL OCK ASSESSMENT PROCEEDINGS DESERVES TO BE ADDED IN THE REGULAR OF REGULAR ASSESSMENT PROCEEDINGS. THE CIT(A) WAS THEREFORE CLEARLY IN ERROR IN LEANING UPON TH E OBSERVATION MADE BY THE COORDINATE BENCH TO COME TO THE CONCLUSION THAT THESE ADDITIONS DESERVE TO BE I.T.A NO.3402/ MUM/2009 ASSESSMENT YEAR: 1998-99 4 CONFIRMED ON MERITS IN THE REGULAR ASSESSMENT PROCEED INGS. IN THIS VIEW OF THE MATTER WE VACATE THE IMPUGNED RECTIFICATION ORDER. THE ASSESSEE GETS RELIEF ACCORDINGLY. 8. IN THE RESULT APPEAL IS ALLOWED. PRONOUNCED IN THE OPEN COURT ON 22 ND JULY 2011 SD/- (V. DURGA RAO) JUDICIAL MEMBER SD/- (PRAMOD KUMAR) ACCOUNTANT MEMBER MUMBAI DATED 22 ND JULY 2011 PARIDA COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER OF INCOME TAX (APPEALS) C-V MUMBAI 4. COMMISSIONER OF INCOME TAX C-II MUMBAI 5. DEPARTMENTAL REPRESENTATIVE BENCH E MUMBAI //TRUE COPY// BY ORDER ASSTT. REGISTRAR ITAT MUMBAI