Shri Prahlad Nathalal Patel, Mehsana v. The ACIT.,Cent.Circle-1(3),, Ahmedabad

ITA 804/AHD/2008 | 2003-2004
Pronouncement Date: 16-09-2011 | Result: Allowed

Appeal Details

RSA Number 80420514 RSA 2008
Assessee PAN ABIPP8891P
Bench Ahmedabad
Appeal Number ITA 804/AHD/2008
Duration Of Justice 3 year(s) 6 month(s) 12 day(s)
Appellant Shri Prahlad Nathalal Patel, Mehsana
Respondent The ACIT.,Cent.Circle-1(3),, Ahmedabad
Appeal Type Income Tax Appeal
Pronouncement Date 16-09-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted B
Tribunal Order Date 16-09-2011
Date Of Final Hearing 13-09-2011
Next Hearing Date 13-09-2011
Assessment Year 2003-2004
Appeal Filed On 04-03-2008
Judgment Text
. .. . . .. . . .. . . .. .!'#$ !'#$ !'#$ !'#$ % % % % & & & & IN THE INCOME TAX APPELLATE TRIBUNAL : B BENCH : AHMEDABAD (BEFORE HONBLE SHRI T.K. SHARMA J.M. & HONBLE SHRI A.K.GARODIA A.M.) . ITA NO. 804/AHD./2008 : ' ()- 2003-2004 SHRI PRAHLAD NATHALAL PATEL MEHSANA VS- A.C.I.T. CENT.CIR-1(3) ABAD (PAN : ABIPP 8891P) ( - /APPELLANT) ( ./ - /RESPONDENT ) - 0 1 / APPELLANT BY : SHRI S.N.DIVATIA A.R. ./ - 0 1 / RESPONDENT BY : SHRI A.TIRKEY SR.D.R. 2'3 0 4% / DATE OF HEARING : 13/09/2011 5'( 0 4% / DATE OF PRONOUNCEMENT : 16/09/2011 / ORDER PER SHRI T.K. SHARMA JUDICIAL MEMBER : THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE O RDER DATED 14-12-2007 OF LEARNED COMMISSIONER OF INCOME TAX(APPEALS)-III AH MEDABAD FOR THE ASSESSMENT YEAR 2003-2004. 2. BRIEFLY STATED THE FACTS ARE THAT THE ASSESSEE IS AN INDIVIDUAL CARRYING ON PROPRIETARY BUSINESS IN THE NAME OF MUKHI TEXTILES AT KALAL. DURING THE COURSE OF SEARCH IN BATA GROUP OF CASES ON 04.09.2003 AT THE RESIDENCE OF SHRI KIRIT B. MODI BHUBH COMPLEX HIGHWAY KALOL MEHSANA WAS ALSO COV ERED AND LOOSE PAPERS FILE CONTAINING 56 PAGES WAS FOUND AND SEIZED AS PER ITE M NO.147 OF ANNEXURE A-2 WHICH CONTAINED COPIES OF PAY IN SLIPS FOR CASH/CHEQUES D EPOSITED IN THE BANK ACCOUNT OF THE VITHALNAGAR CO.OP. HOUSING SOCIETY COPIES OF MONEY RECEIPTS ISSUED BY AUDA AND CORRESPONDENCE WITH AUDA. DETAILS WERE ALSO OBTAINE D FROM MEHSANA DIST. CO.OP. BANK KALAL WHICH SHOW THAT THE ASSESSEE PURCHASED DEMAND DRAFTS FOR RS.10 00 000/- AS UNDER : ITA NO. 804-AHD-08 2 DD NO. DATE AMOUNT NAME OF THE PURCHASER 74863 22-4-2002 10 00 000 PRAHLADBHAI N. PATEL PAY IN SLIPS FOR DEPOSITING CASH ON 25-1-2003 WAS A LSO SEIZED AS PER PAGE-44 OF ITEM NO.147 OF ANNEX. A-2 FROM THE RESIDENTIAL PREMISES OF SHRI KIRIT B. MODI WHICH SHOW THAT CASH OF RS.5 LACS WAS DEPOSITED IN THE BANK AC COUNT OF THE VITHALNAGAR C.OP. HOUSING SOCIETY FOR THE PURCHASE OF DEMAND DRAFT IN FAVOUR OF AUDA IS MENTIONED. THIS PAYMENT OF RS.5 00 000 WAS ALSO MADE BY SHRI P RAHLAD NATHALAL PATEL. 2.1 ON THE BASIS OF ABOVE PROCEEDINGS UNDER CHAPTE R XIV WERE INITIATED UNDER SECTION 153C OF THE ACT FOR WHICH NOTICE UNDER SECT ION 153C WAS ISSUED. NO RETURN OF INCOME WAS FILED IN RESPONSE TO THE SAID NOTICE. T HEREAFTER ONE MORE SHOWCAUSE NOTICE WAS ISSUED TO THE ASSESSEE ON 23.01.2006 AND IN RESPONSE TO THIS THE ASSESSEE FILED RETURN ON 13.02.2006 SHOWING TOTAL INCOME OF RS.1 41 461/-. THE AO FRAMED THE ASSESSMENT UNDER SECTION 153A(B) ON 14.03.2006 AT A TOTAL INCOME OF RS.16 41 461/- WHEREIN HE MADE ADDITION UNDER SECTION 153A(B) AMOU NTING TO RS.15 LAKHS AS UNDER: ADD: ADDITION U/S.153A(B) I) IN RESPECT OF CASH DEPOSITED ON 22-4-2002 AS DISCUSSED ABOVE RS.10 00 000 II) CASH DEPOSITED IN BANK THROUGH PAY IN SLIPS AS DISCUSSED ABOVE RS. 5 00 000 3. ON APPEAL IN THE IMPUGNED ORDER THE LD. CIT(A) CONFIRMED BOTH THE ADDITIONS FOR THE DETAILED REASON GIVEN IN PARA 9 WHICH READ S AS UNDER: 9 THE CONTENTS WERE CAREFULLY CONSIDERED. THE DOCU MENTS (SUCH AS PAY IN SLIPS) PERTAINING TO THE APPELLANT WHICH WERE SEIZ ED FROM KIRIT MODI ARE NOT IN DISPUTE. ALSO THE OFFICE BEARER OF THE HOUSING SOCI ETY SHRI BHARAT RAO WAS THE SON OF THE APPELLANT. HENCE THE STATED DENIAL OF O PPORTUNITY TO THE APPELLANT FOR CROSS-EXAMINING KIRIT AND BHARAT HAS LITTLE REL EVANCE. THE SOURCE OF THE DEPOSIT OF RS.5 LAKHS IN BANK ACCOUNT OF THE SOCIET Y ON 25/1/2003 (AS PER PAGE 44 OF ITEM 147 OF ANNEXURE A-2) IS NOT SPECIFICALLY EXPLAINED AND THE APPELLANT HAD ADMITTED (U/S.131(1A) ON 26/4/2004) THAT IT WAS UNACCOUNTED. THE SOURCE OF RS.10 LAKHS FOR DD PURCHASED IS STATED TO BE TH E MONEY GIVEN BY SHRI BHARAT RAO. IT IS NOT EXPLAINED AS TO WHY BHARAT RA O DID NOT HIMSELF GOT THE DRAFT MADE IF HE HAD THE MONEY. EVEN THE SOURCE OF THE MONEY ASCRIBED TO THE CONTRIBUTION OF SOCIETY MEMBERS IS NOT ESTABLISHED SINCE THE CONFIRMATIONS OF MEMBERS ARE NOT ESSENTIALLY TO THIS EFFECT. THE A.O . THEREFORE HAD VALID DOUBTS. ITA NO. 804-AHD-08 3 THE A.O. ALSO LAID BARE THE MODUS OPERANDI FOLLOWED BY INDIVIDUALS TO FORM POST FACTO HOUSING SOCIETIES. THE INITIAL AMOUNT OF RS.5 LAKHS AND RS.10 LAKHS WAS THUS CONTRIBUTED BY THE APPELLANT FROM OUT OF H IS UNDISCLOSED INCOME. THUS THERE IS NO INFIRMITY IN THE FINDINGS OF THE A.O. A ND THE ADDITIONS MADE BY HIM ARE CONFIRMED. 4. AGGRIEVED WITH BOTH THE ADDITIONS CONFIRMED BY T HE LD. CIT(A) THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 5. AT THE TIME OF HEARING ON BEHALF OF THE ASSESSE E SHRI S.N.DIVATIA APPEARED AND FILED AN APPLICATION FOR ADMISSION OF THE FOLLOWING ADDITIONAL GROUND UNDER RULE 11 OF INCOME TAX (APPELLATE TRIBUNAL) RULES 1963. THE NOTICE ISSUED U/S.153C R.W.S. 153A OF THE ACT O N THE BASIS OF LOOSE PAPERS FOUND ON THE SEARCHED PREMISES WHICH DO NOT BELONG TO THE APPELLANT IS WITHOUT JURISDICTION AND VOID AB INITI O SO THAT THE SAME DESERVES TO BE QUASHED . 5.1 FOR ADMISSION OF THE AFORESAID GROUND OF APPEAL THE COUNSEL OF THE ASSESSEE POINTED OUT THAT BEFORE THE LD. CIT(A) THE AFORESA ID GROUND WHICH IS PURELY A LEGAL GROUND RELATING TO THE VALIDITY OF NOTICE ISSUED UN DER SECTION 153C R.W.S. 153A WAS LEFT OUT THROUGH OVERSIGHT AND INADVERTENCE. THEREF ORE HE SUBMITTED THAT OMISSION TO RAISE THIS GROUND OF APPEAL IS NEITHER WILLFUL NOR DELIBERATE AS THIS GROUND IS RAISED ON THE BASIS OF THE DECISION OF THE HONBLE GUJARAT HI GH COURT IN THE CASE OF VIJAYBHAI N. CHANDRANI VS- ACIT REPORTED IN 333 ITR 436 (GUJ) W HICH WAS DELIVERED ON 30.03.2010. HE POINTED OUT THAT THE APPEAL BEFORE T HE LD. CIT(A) WAS FILED ON 07.04.2006 AND IT WAS DECIDED BY THE LD. CIT(A) ON 14.12.2007. THIS ADDITIONAL GROUND HAS BEEN RAISED ON THE BASIS OF JUDGEMENT OF THE HONBLE GUJARAT HIGH COURT IN THE CASE OF VIJAYBHAI N. CHANDRANI ( SUPRA ) AND THIS GROUND IS PURELY A LEGAL GROUND ALL THE FACTS NECESSARY FOR THE SAME ARE ON RECORD. THEREFORE IT MAY BE ADMITTED. FOR ADMISSION OF THIS ADDITIONAL GROUND COUNSEL OF THE ASSESSEE PLACED RELIANCE ON THE JUDGMENT OF HONBLE SUPREME COURT I N THE CASE OF JUTE CORPORATION OF INDIA LTD. VS- CIT REPORTED IN 187 ITR 688 (SC) AN D NATIONAL THERMAL CO. LTD. VS- CIT REPORTED IN 229 ITR 383 (SC). THE COUNSEL OF TH E ASSESSEE ALSO DREW OUR ATTENTION TO PAGE 1 OF THE ASSESSMENT ORDER WHEREIN THE AO HI MSELF HAS MENTIONED THAT SEARCH ITA NO. 804-AHD-08 4 HAS BEEN CONDUCTED IN BATA GROUP OF CASES ON 04.07. 2003. THE COUNSEL OF THE ASSESSEE ALSO POINTED OUT THAT NO SEARCH HAS BEEN CONDUCTED EITHER AT THE RESIDENCE OR THE BUSINESS PREMISES OF THE ASSESSEE. THEREFORE THE A SSESSMENT FRAMED BE QUASHED. 6. ON THE OTHER HAND SHRI A. TIRKEY SR.D.R. APPE ARING ON BEHALF OF THE REVENUE POINTED OUT THAT ADDITIONAL GROUND RAISED SHOULD NOT BE ADMITTED BECAUSE IT NEEDS INVESTIGATION OF FACTS AND VERIFICATION FROM THE ASSESSMENT RECORDS. THE LD. D.R. ALSO POINTED OUT THAT BEFORE THE AO THE ASSESSEE H AS FURNISHED THE RETURN OF INCOME IN RESPONSE TO NOTICE UNDER SECTION 153C WHICH WAS IS SUED AND SERVED ON 26.02.2005. IT WAS ALSO SUBMITTED THAT THE ASSESSEE HAS ALSO PARTI CIPATED IN ASSESSMENT AND APPELLATE PROCEEDINGS BEFORE THE FIRST APPELLATE AUTHORITY. T HEREFORE NOW HE CANNOT RAISE THIS ADDITIONAL GROUND. 6.1 WITHOUT PREJUDICE TO THE ABOVE THE LD. D.R. SU BMITTED THAT IN CASE THIS ADDITIONAL GROUND IS ADMITTED THEN FOLLOWING THE D ECISION OF THE HONBLE M.P. HIGH COURT IN THE CASE OF CIT-VS- TOLLARAM HASSOMAL REPO RTED IN 298 ITR 22 (MP) THE TRIBUNAL SHOULD REMAND THE CASE TO COMMISSIONER (AP PEALS). 7. HAVING HEARD BOTH THE SIDES WE HAVE CAREFULLY G ONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. IT IS PERTINENT TO NOTE THAT ADD ITIONAL GROUND RAISED NOW BEFORE US IS ON THE BASIS OF RATIO OF THE JUDGMENT OF THE HON BLE GUJARAT HIGH COURT IN THE CASE OF VIJAYBHAI N. CHANDRANI ( SUPRA ). WHEN THE ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A) THIS JUDGMENT OF THE HONBLE GUJARAT HIGH C OURT WAS NOT AVAILABLE. BE THAT IT MAY BE THIS IS A PURE ADDITIONAL GROUND. WE THERE FORE ADMIT THE SAME. AT THE SAME TIME WE FIND CONSIDERABLE FORCE IN THE SUBMISSIONS MADE BY THE LD. SR.D.R. THAT AS PER JUDGMENT OF THE HONBLE M.P.HIGH COURT THE TRI BUNAL HAVING PERMITTED ADDITIONAL GROUND TO BE RAISED FOR THE FIRST TIME SHOULD REMAND THE CASE TO COMMISSIONER (APPEALS). WE THEREFORE FOLLOWING TH IS JUDGMENT OF THE HONBLE M.P. HIGH COURT IN THE CASE OF CIT-VS- TOLLARAM HASSOMAL ( SUPRA ) SET ASIDE THE ORDER OF THE LD. CIT(A) AND DIRECT THE LD. CIT(A) TO FIRST D ECIDE THE ADDITIONAL GROUND THEREAFTER IF NECESSARY HE WILL READJUDICATE THE OTHER GROUND RAISED BEFORE HIM ITA NO. 804-AHD-08 5 AFRESH IN ACCORDANCE WITH LAW AFTER GIVING OPPORT UNITY OF BEING HEARD TO BOTH THE SIDES. 8. IN THE RESULT FOR STATISTICAL PURPOSES THE APP EAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED. 6 0 5'( #' ) 16 / 09 /2011 ' 7 0 !3 8 THIS ORDER PRONOUNCED IN COURT ON 16/09/2011. SD/- SD/- (A.K.GARODIA) (T.K. SHARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 16/09/2011 0 00 0 .49 .49 .49 .49 :9(4) :9(4) :9(4) :9(4)- -- - 1. - 2. ./ - 3. 4 2> 4. 2>- - 5. 9A! .4' 8 6. !$ C6 D/ F 8 TALUKDAR/ SR. P.S.