DCIT CEN CIR 2(3), MUMBAI v. DHAVAL D. SHAH, MUMBAI

ITA 6312/MUM/2016 | 2007-2008
Pronouncement Date: 30-11-2017 | Result: Dismissed

Appeal Details

RSA Number 631219914 RSA 2016
Assessee PAN AAHPS2691E
Bench Mumbai
Appeal Number ITA 6312/MUM/2016
Duration Of Justice 1 year(s) 1 month(s) 4 day(s)
Appellant DCIT CEN CIR 2(3), MUMBAI
Respondent DHAVAL D. SHAH, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 30-11-2017
Appeal Filed By Department
Tags No record found
Order Result Dismissed
Bench Allotted Not Allotted
Tribunal Order Date 30-11-2017
Assessment Year 2007-2008
Appeal Filed On 26-10-2016
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH B MUMBAI BEFORE SHRI G.S. PANNU ACCOUNTANT MEMBER AND SHRI PAWAN SINGH JUDICIAL MEMBER ITA NO. 6312/MUM/2016 : A.Y : 2007 - 08 DY. COMMISSIONER OF INCOME TAX CENTRAL CIRCLE - 2(3) MUMBAI (APPELLANT) VS. SHRI DHAVAL D. SHAH 401 DEEPAK BUILDING 3 RD FLOOR S.V. ROAD OPP. PAWAN HANS VILE PARLE (W) MUMBAI PAN : AA HPS2691E (RESPONDENT) APPELLANT BY : SHRI SUMAN KUMAR RESPONDENT BY : SHRI NIKHIL TIWARI DATE OF HEARING : 08/11/2017 DATE OF PRONOUNCEMENT : 30 /11/2017 O R D E R PER G.S. PANNU AM : THE CAPTIONED APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF CIT(A) - 48 MUMBAI DATED 08.08.2016 PERTAINING TO THE ASSESSMENT YEAR 2007 - 08 WHICH IN TURN HAS ARISEN FROM THE ORDER PASSED BY THE ASSESSING OFFICER MUMBAI DATED 31.03.2015 U/S 153A R.W.S. 143(3) OF THE INCOME TAX ACT 1961 (IN SHORT THE ACT). 2. IN ITS APPEAL REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : - (I) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) ERRED IN DELETING THE ADDITIONS STATING THAT THE ADDITIONS HASNOT BEEN MADE BASED 2 ITA NO. 6312/MUM/2016 DHAVAL D. SHAH ON THE INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH AND ERRED IN RELYING ON THE DECISION IN THE CASE OF CONTINENTAL WAREHOUSING CORPORATION (NHAVA SEVA) (2015) 374 ITR 645 (BOM.) OF HON'BLE BOMBAY HIGH COURT WITHOUT APPRECIATING THE FACT THAT THE SLP HAS BEEN ADMITTED BY THE HON'BLE SUPREME COURT AGAINST THE AFORESAID DECISION. 2. THE APPELLANT CRAVES LEAVE TO ADD TO AMEND AND/OR ALTER ANY GROUNDS OF APPEAL IF NEED TO BE. 3. THE APPELLANT THEREFORE PRAYS THAT ON THE GROUNDS STATED ABOVE THE ORDER OF THE CIT(A) - 48 MUMBAI MAY BE SET ASIDE AND THAT OF THE ASSESSING OFFICER RESTORED. 3. IN B RIEF THE RELEVANT FACTS ARE THAT THE ASSESSEE WAS COVERED IN A SEARCH AND SEIZURE ACTION CARRIED OUT BY THE DEPARTMENT U/S 132(1) OF THE ACT ON 17.02.2012. CONSEQUENTLY A NOTICE U/S 153A(1) OF THE ACT WAS ISSUED TO THE ASSESSEE ON 03.10.2013 IN RESPONSE TO WHICH ASSESSEE FILED HIS RETURN OF INCOME ON 05.12.2013 DECLARING A TOTAL INCOME OF RS.9 19 263/ - AND IN THE ENSUING ASSESSMENT FINALISED U/S 153A(1) R.W.S. 143(3) OF THE ACT DATED 31.03.2015 THE TOTAL INCOME HAS BEEN ASSESSED AT RS.82 54 940/ - . THE ASSESSMENT SO MADE INTER - ALIA INCLUDED DISALLOWANCE OF INTEREST PAID TO THE PARTNERSHIP FIRM IN WHICH ASSESSEE WAS A PARTNER AMOUNTING TO RS.73 35 674/ - . THIS DISALLOWANCE HAS BEEN DELETED BY THE CIT(A) BY NOTICING THAT IT WAS NOT SUPPORTED BY ANY INCR IMINATING MATERIAL FOUND IN THE COURSE OF SEARCH AND SINCE ON THE DATE OF THE SEARCH THE ORIGINAL ASSESSMENT DID NOT ABATE SUCH AN ADDITION COULD NOT HAVE BEEN MADE IN THE IMPUGNED ASSESSMENT IN VIEW OF THE JUDGMENT OF THE HON'BLE BOMBAY HIGH COURT IN TH E CASE OF CONTINENTAL WAREHOUSING CORPORATION (NHAVA SEVA) [2015] 374 ITR 645 (BOM.) . AGAINST SUCH A DECISION OF THE CIT(A) REVENUE IS IN APPEAL BEFORE US. 3 ITA NO. 6312/MUM/2016 DHAVAL D. SHAH 4. FROM THE RECORDS IT IS EMERGING THAT ON THE DATE OF SEARCH I.E. 17.02.2012 THE ASSESSMENT FOR ASSESSMENT YEAR 2007 - 08 HAD ATTAINED FINALITY IN VIEW OF THE ASSESSMENT FINALISED U/S 143(3) DATED 24.12.2009. ACCORDINGLY IN TERMS OF SECOND PROVISO TO SEC. 153A(1) OF THE ACT SUCH AN ASSESSMENT DID NOT ABATE. IN THIS FACTUAL BACKGROUND THE RATIO OF THE JUDGMENT OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CONTINENTAL WAREHOUSING CORPORATION (NHAVA SEVA) (SUPRA) COMES INTO OPERATION WHICH PRESCRIBES THAT THE IMPUGNED ADDITION COULD HAVE BEEN MADE BY THE ASSESSING OFFICER ONLY IF ANY INCRIMINAT ING MATERIAL WAS FOUND IN THE COURSE OF SEARCH RELATING TO SUCH AN ADDITION. THE DISCUSSION IN THE ASSESSMENT ORDER DOES NOT REFER TO ANY INCRIMINATING MATERIAL RELATING TO THE DISALLOWANCE MADE BY THE ASSESSING OFFICER OUT OF INTEREST PAID TO THE PARTNER SHIP FIRM IN WHICH THE ASSESSEE IS A PARTNER. THE CIT(A) HAS CONCLUDED THAT THERE WAS NO INCRIMINATING MATERIAL REVEALED IN THE COURSE OF SEARCH AND THEREFORE THE ASSESSING OFFICER WAS NOT COMPETENT TO MAKE THE IMPUGNED ADDITION IN THE ASSESSMENT FINALI SED U/S 153A R.W.S. 143(3) OF THE ACT. 5. BEFORE US THE FACTUAL FINDINGS OF THE CIT(A) HAVE NOT BEEN DISPUTED BUT THE ONLY POINT WHICH IS SOUGHT TO BE CANVASSED AS IS EVIDENT FROM THE GROUNDS OF APPEAL RAISED IS THAT THE DECISION OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CONTINENTAL WAREHOUSING CORPORATION (NHAVA SEVA) (SUPRA) HAS NOT BEEN ACCEPTED BY THE DEPARTMENT AS AN SLP HAS BEEN FILED IN THE HON'BLE SUPREME COURT. IN OUR CONSIDERED OPINION THE ORDER OF THE CIT(A) DESERVES TO BE CONFIRMED INASMUCH AS IT IS BASED ON A SUBSISTING DECISION OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CONTINENTAL 4 ITA NO. 6312/MUM/2016 DHAVAL D. SHAH WAREHOUSING CORPORATION (NHAVA SEVA) (SUPRA). MERELY BECAUSE A SLP HAS BEEN FILED BY THE REVENUE AGAINST THE JUDGMENT OF THE HON'BLE BOMBAY HIGH C OURT DOES NOT SHOW ANY ERROR ON THE PART OF THE CIT(A) IN APPLYING THE SUBSISTING JUDGMENT OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CONTINENTAL WAREHOUSING CORPORATION (NHAVA SEVA) (SUPRA). THEREFORE IN THE ABSENCE OF ANY INCRIMINATING MATERIAL T HE IMPUGNED ADDITION WAS RIGHTLY DELETED BY THE CIT(A) AS BEING LACKING IN JURISDICTION WHICH IS HEREBY AFFIRMED. 6. IN THE RESULT APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 3 0 T H NOVEMBER 2017 SD/ - SD/ - ( PAWAN SINGH ) JUDICIAL MEMBER (G.S. PANNU) ACCOUNTANT MEMBER MUMBAI DATE : 3 0 T H NOVEMBER 201 7 *SSL* COPY TO : 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT(A) CONCERNED 4) THE CIT CONCERNED 5) THE D.R B BENCH MUMBAI 6) GUARD FILE BY ORDER DY./ASSTT. REGISTRAR I.T.A.T MUMBAI