JAYESH MEHTA, MUMBAI v. ITO 25(2)(1), MUMBAI

ITA 4075/MUM/2012 | 2004-2005
Pronouncement Date: 22-10-2013 | Result: Partly Allowed

Appeal Details

RSA Number 407519914 RSA 2012
Assessee PAN AABCJ2982J
Bench Mumbai
Appeal Number ITA 4075/MUM/2012
Duration Of Justice 1 year(s) 4 month(s) 11 day(s)
Appellant JAYESH MEHTA, MUMBAI
Respondent ITO 25(2)(1), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 22-10-2013
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted J
Tribunal Order Date 22-10-2013
Date Of Final Hearing 22-10-2013
Next Hearing Date 22-10-2013
Assessment Year 2004-2005
Appeal Filed On 11-06-2012
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL J BENCH MUMBAI BEFORE SHRI H.L.KARWA JM & SHRI N.K.BILLAIYA AM ITA NO. 4075 / MUM/ 20 12 ( ASSESSMENT YEAR : 20 0 4 - 20 0 5 ) SHRI JAYESH VASANTRAI MEHTA 202 NAVNATH APARTMENT M.G.CROSS ROAD NO. 4 KANDIVALI (WEST) MUMBAI - 400 067 VS. ITO WARD 25(2)(1) MUMBAI PAN/GIR NO. : A ABCJ 2982 J ( APPELLANT ) .. ( RESPONDENT ) /ASSESSEE BY : MR. N.C.MOHANTY /REVENUE BY : MR. SHISHIR SRIVASTAVA DATE OF HEARING : 22 ND DATE OF PRONOU NCEMENT : 22 ND OCTOBER 2013 O R D E R PER N.K.BILLAIYA AM : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE CIT(A) - 3 5 MUMBAI DATED 27 - 04 - 2012 PERTAINING TO ASSESSMENT YEAR 20 04 - 2005 . 2 . THE SUM AND SUBSTANCE OF THE FIRS T GRIEVANCE OF THE ASSESSEE IS THAT THE CIT(A) ERRED IN UPHOLDING THE ADDITION OF RS. 26 53 300/ - BEING ALLEGED UNEXPLAINED CASH CREDIT UNDER SECTION 68 OF THE ACT. THE OTHER GRIEVANCE OF THE ASSESSEE RELATES TO THE INITIATION OF PENALTY UNDER SECTION 271( 1)(C) OF THE ACT. ITA NO. 4075 /12 2 3 . AT THE VERY OUTSET LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE FACTS AND ISSUES INVOLVED IN THE PRESENT APPEAL ARE IDENTICAL TO THE FACTS AND ISSUES INVOLVED IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2005 - 06 WHICH WAS DECI DED BY THE TRIBUNAL IN ITA NO. 5142/M UM /2009 VIDE ORDER DATED. 29 - 06 - 2012. 4 . ON THE OTHER HAND LEARNED DR HAS NOT OBJECTED TO THE ABOVE SUBMISSION MADE BY THE LEARNED COUNSEL FOR THE ASSESSEE. 5 . WE HAVE CAREFULLY PERUSED THE ASSESSMENT ORDER AND ORDE R OF THE CIT(A) VIS - - VIS THE ORDER OF THE TRIBUNAL PASSED IN ITA NO. 5142 /M UM /2012 DATED 29 - 06 - 2012. WE FIND THAT THE FACTS IN THE PRESENT APPEAL AND THE APPEAL DECIDED BY THE TRIBUNAL FOR THE ASSESSMENT YEAR 2005 - 06 IN ASSESSEES OWN CASE ARE IN PARI MA TERIA THE SAME IN AS MUCH AS IN THAT YEAR ALSO THE ASSESSEE WAS ASKED TO EXPLAIN THE SOURCE OF DEPOSITS IN BANK ACCOUNTS. IN THE PRESENT YEAR ALSO THE DISPUTE RELATES TO THE DEPOSIT IN THE FOUR BANK ACCOUNTS WITH AXIS BANK. THE TRIBUNAL IN ASSESSEES OWN C ASE FOR THE ASSESSMENT YEAR 2005 - 06 AFTER CONSIDERING TH E ENTIRE FACTS THUS HELD IN PARA 11 AT PAGE 6 AS UNDER : - 11. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE PERUSED THE ORDERS OF LOWER AUTHORITIES AND ALSO THE PAPER BOOK SUBMITTED BY THE ASSESSEE IN THE APPELLATE PROCEEDINGS. THE FACTS. WHICH ARE NOT IN DISPUTE IS THAT THE CASH WAS ACTUALLY DEPOSITED IN ALL THE BANK ACCOUNTS AS MENTIONED HEREINABOVE. IT IS ALSO NOT IN DISPUTE THAT THE ASSESSEE WAS PROVIDING ACCOMMODATION ENTRIES. IT IS ALSO AN ADM ITTED FACT THAT THE ASSESSEE COULD NOT PRODUCE SHRI JATIN SHAH OR ANY OF THE BENEFICIARIES TO WHOM HE WAS PROVIDING 'ACCOMMODATION' AND AT THE SAME TIME THE ASSESSEE HAS NOT DISCHARGED THE INITIAL ONUS CAST UPON HIM AND THEREFORE FAILS IN SUCCEEDING IN THI S GROUND OF APPEAL. HOWEVER IN ALTERNATIVE THE ITA NO. 4075 /12 3 ASSESSEE'S COUNSEL AGREED THAT HE HAS NO OBJECTION IN ESTIMATION OF PROFIT FROM HAWALA BUSINESS AND ADDITION OF PEAK DEPOSIT WHICH PLEA IS ALSO IN THE THIRD GROUND OF APPEAL AND HAS BEEN ACCEPTED BY THE DEPA RTMENT IN A.Y. 2002 - 03 IN ASSESSEE'S OWN CASE WHEREIN THE CIT ( A) HAS ENHANCED THE INCOME OF THE ASSESSEE ON THE BASIS OF THE PEAK CREDIT STATEMENT SUBMITTED BY THE ASSESSEE DURING THE COURSE OF THE APPELLATE PROCEEDINGS. CONSIDERING THE ABOVE THE ENTIRE C ASH DEPOSIT FOR THE YEAR UNDER CONSIDERATION AT RS. 4 81 91 420/ - CANNOT BE ADDED AS DEEMED INCOME OF THE ASSESSEE. WE FIND SOME FORCE IN THE ARGUMENT OF THE COUNSEL THAT AT THE MOST THE PEAK DEPOSIT IN ALL THE BANK ACCOUNTS TAKEN TOGETHER SHOULD BE TAKEN FOR THE ADDITION U/S. - 68OF THE ACT. AFTER CONSIDERING THE FACTS IN TOTALITY AND THE RIVAL SUBMISSIONS AND IN THE INTEREST OF NATURAL JUSTICE AND FAIR PLAY WE RESTORE THIS ISSUE BACK TO THE FILE OF THE AO. THE ASSESSEE IS DIRECTED TO FILE A PEAK DEPOSIT S TATEMENT OF ALL THE BANK ACCOUNTS TAKEN TOGETHER AND THE AO IS DIRECTED TO VERIFY THE PEAK DEPOSITS OF ALL THE BANK ACCOUNTS TOGETHER AND AFTER VERIFYING THE AO IS DIRECTED TO MAKE THE ADDITION OF THE PEAK DEPOSITS SO DETERMINED AFTER GIVING REASONABLE OP PORTUNITY OF BEING HEARD TO THE ASSESSEE. 12. HOWEVER IN ALL FAIRNESS WE DIRECT THE AO TO COMPUTE THE PROFIT OF THE ASSESSEE FROM SUCH HAWALA BUSINESS AT THE RATE OF 0.5% OF THE ENTIRE CASH DEPOSITED I.E. RS. 4 81 91 420/ - DURING THE YEAR UNDER CONSIDE RATION AS BEFORE ADIT (INV) THE ASSESSEE HAS STATED THAT 'HE HAS RECEIVED ONLY RS. 1 50 000/ - FOR PROVIDING ACCOMMODATION TRANSACTIONS TO THE EXTENT OF RS. 5.12 CRORES. HOWEVER THIS APPEARS TO BE MINIMUM AMOUNT AS COMPARED TO THE VOLUME OF TRANSACTIONS. T HEREFORE THE AO MAY ASSESS THE CORRECT INCOME ACCORDINGLY. AS MENTIONED HEREINABOVE FACTS BEING IDENTICAL FOLLOWING THE DECISION OF THE TRIBUNAL IN ITA NO. 5142/MUM/2012 (SUPRA) THE AO IS DIRECTED TO DECIDE THE ISSUE IN THE LIGHT OF THE AFORE STATED DEC ISION OF THE TRIBUNAL IN ASSESSEES OWN CASE . T HE FIRST GRIEVANCE OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. 6 . THE SECOND GRIEVANCE OF THE ASSESSEE IS RELATING TO THE INITIATION OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT WHICH IS PR EMATURE AND THEREFORE THE SAME IS HEREBY DISMISSED. ITA NO. 4075 /12 4 7 . RESULTANTLY THE APPEAL OF THE ASSESSEE IS ALLOWED PARTLY FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 2 2 /10/ 2013 . SD/ - ( ) ( H.L.KARWA ) SD/ - ( ) ( N.K.BILLAIYA ) / PRESIDENT / ACCOUNTANT MEMBER MUMBAI ; DATED : 2 2 /10 /2013 /PKM PS COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / THE CIT(A) MUMBAI. 4. / CIT 5. / DR ITAT MUMBAI 6. GUARD FILE. //TRUE COPY// / BY ORDER ( ASSTT. REGISTRAR) / ITAT MUMBAI