Income Tax Appellate Tribunal - Ahmedabad
Late Shri Bholidas T. Patel, Legal Heir ... vs The Acit, Central Circle-1(2),, ... on 27 January, 2021
IN THE INCOME TAX APPELLATE TRIBUNAL
AHMEDABAD "C" BENCH
(Virtual Court)
Before: Shri Rajpal Yadav, Vice President
And Shri Amarjit Singh, Accountant Member
M.A. No. 226, 227 & 228/Ahd/2018
(In IT(SS)A Nos. 299 to 301 /Ahd/2016)
Assessment Year 2009-10 & 2010-11
Late Shri Bholidas T The ACIT,
Patel, Legal Heir Central Circle-1(2),
Shri Rupesh B. Patel, Vs Ahmedabad
B-26, Ishwarkrupa (Respondent)
Society, Panchvati
Highway, Kalol-382721
PAN: ABIPP7554M
(Appellant)
Revenue by: Shri L.P. Jain, Sr. D.R.
Assessee by: Shri S.N. Soparkar, A.R.
Date of hearing : 04-12-2020
Date of pronouncement : 27-01-2021
आदे श/ORDER
PER : AMARJIT SINGH, ACCOUNTANT MEMBER:-
The assessee has filed all the three Miscellaneous Applications in respect of common order of the ITAT vide IT(SS)A Nos. 299, 300 & 301/Ahd/2016 dated 19-06-2018.
2. Since similar facts and issues involved in all the Miscellaneous Applications, therefore, for the sake of convenience all these MAs are M.A. Nos. 226, 227 228/Ahd/2018 A.Y. 2009-10 & 2010-11 Page No 2 Late Shri Bholidas T Patel vs. ACIT adjudicated together by taking M.A. No. 226/Ahd/2018 as lead case and its finding will be applicable to the remaining two M.A.s. i.e. 227/Ahd/2018 & 228/Ahd/2018
3. In the Miscellaneous Application, the assessee has mainly stated that the ld. CIT(A) has allowed the appeal of the assessee on the technical ground that no incriminating material was found during the search. The ld. CIT(A) has not adjudicated the appeal of the assessee on merit. The revenue has filed the appeal against the order of the ld. CIT(A) before the ITAT. The ITAT vide order dated 19-06-2018 vide IT(SS)A Nos. 299, 300 & 301/Ahd/2016 has allowed the appeal of the Revenue holding that un- registered banakhat found and seized during the search was as incriminating material on the basis of which the Assessing Officer has made assessment. The Miscellaneous Application filed by the assessee is reproduced as under:-
"1. The present application is filed by the applicant/appellant above named for setting aside the order dated 19/06/2018 passed by this Hon'ble ITAT by allowing the appeal filed by the respondent (Original Applicant). It is most respectfully submitted that in the said order of the Hon'ble TTAT, there are errors apparent on the record.
2. There was a search in case of Kalol - Prajapati Group on 6lh Nov. 2012. A search warrant u/s 132 of the Act was also issued in the case of the assessee. AO proceeded to make assessment u/s 153A of the Act that was challenged by the assessee before Id. CIT (A) firstly on the grounds of jurisdiction u/s 153A of the Act and secondly on merits. Ld. CIT (A) deleted addition made by AO holding that no addition can be made in absence of any incriminating material found during search when the assessment proceedings for the year under consideration are not pending following ratio of jurisdictional ITAT & High Court without commenting on the merits of the issue as in Para 8 of appellate order as below:
"8. It was an undisputed fact that on the date of initiation of the search no assessment proceedings were pending in this assessment year. Therefore, the proceedings were not abated in the case as mentioned in the second proviso to section 153A(1) of the Act. It seems that the AO lost sight of the fact that he was not making an assessment under section 153A (1) of the Act read with its second proviso. As discussed hereinabove, there is no indication in the contents of the assessment order that addition was made on the basis of any seized material. The sole basis of addition was copy of banakhat seized in the course of search which was already disclosed in the return of income for the year under consideration as discussed in the forgoing paras. Therefore, after the facts of the case, the position of law on the issue and respectfully following the decisions of the jurisdictional ITAT and the Hon'ble High Courts, in my considered opinion, the action of the AO was not justified. Accordingly, the ground of appeal is allowed.
Since the issue related to the addition, which was not based on any seized incriminating material and the proceedings in the assessment year were not abated on the date of initiation of search, has been adjudicated, there is no need to comment on the merits of the case."
3. The Hon'ble Bench reversed decision of Id. CIT (A) to hold seized banakhat as incriminating material & held that AO had jurisdiction to proceed u/s 153A of the Act. However thereafter Hon'ble Bench also adjudicated the issue of addition made by AO u/s 50C of the Act not appreciating that Id. CIT (A) had not adjudicated the issue on merits.
4. During the course of hearing of the appeal before the Hon'ble Bench also the parties addressed the Hon'ble Bench only on the issue of jurisdiction to pass order u/s 1 53A of the Act. Merits of addition were not argued by either party before the Hon'ble Bench.
5. It is therefore submitted that there is an error apparent on record in the order of the Hon'ble Bench proceeding to adjudicate the merits of addition considering that the said issue did not arise out of the order of Id. CIT (A) and in absence of any arguments before the Hon'ble Bench.
M.A. Nos. 226, 227 228/Ahd/2018 A.Y. 2009-10 & 2010-11 Page No 3 Late Shri Bholidas T Patel vs. ACIT
6. The Applicant therefore, respectfully submits that in the larger interest of justice the Hon'ble Tribunal be pleased to accept the prayer of the applicant/appellant and recall the order passed allowing the appeal filed by the Revenue to hear the appeal on merits & grant justice to the applicant."
4. Heard both the sides and perused the material on record. The power of rectification u/s. 254(2) of the Income Tax Act can be exercised only when the mistake which is sought to be rectified is an obvious and patent mistake which is apparent from the record and not a mistake which requires to be established by arguments and long drawn process of reasoning on points of which there may conceivably two opinions. A perusal of the record would indicate that Assessing Officer has passed the assessment order u/s. 143(3) r.w.s. 153A(1)(b) of the Income Tax Act on 25th Feb, 2011. He made an addition of Rs. 52,92,985/- u/s. 50C of the Income Tax Act after taking full value of consideration as per the seized banakhat. The ld. CIT(A) has deleted the addition on technical ground holding that no incriminating material was found and seized during the search. This order was challenged before the Tribunal in the above appeal and Tribunal after hearing both the parties found that there was an incriminating material found during the search in the shape of un-registered banakhat (agreement). In the opinion of the Tribunal, this was a seized material and it is sufficient to take cognizance u/s. 153A of the Income Tax Act against the assessee. The Tribunal did not agree with the conclusions of the ld. CIT(A) that no material was found during the course of search. Thus, Tribunal has reversed the finding of the ld. CIT(A) and restored that of Assessing Officer. In the Miscellaneous Application, it has been contended by the assessee that Tribunal has restored the addition on merit without adjudicating the issue. It is pertinent to observe that scope of the appeal before the Tribunal was with regard to the correctness of the finding of the ld. CIT(A) whether any incriminating M.A. Nos. 226, 227 228/Ahd/2018 A.Y. 2009-10 & 2010-11 Page No 4 Late Shri Bholidas T Patel vs. ACIT material was found during the course of search. The ld. CIT(A) did not comment on merit as discernable at page no. 12 of his order. The ITAT has drawn the conclusion after taking into consideration the material on record that banakhat was an incriminating material found and seized during search action on the basis of which the Assessing Officer has made addition u/s. 50C of the Act. The assessee has neither filed cross objection nor filed application with the aid of Rule 27 of the ITAT before challenging this finding. Thus, there is no occasion for the Tribunal to record a finding on the quantification of the addition. If there is any grievance at the end of the assessee then such grievance ought to be raised before ld. CIT(A) who has not adjudicated the issue on merit by observing that it does not call for adjudication. The assessee either ought to have filed appeal before the Tribunal challenging this finding or should have filed an application for rectification before the first appellate authority. With the above observations for statistical purposes, we do not find any merit in these Miscellaneous Applications. They are disposed off. Accordingly, we do not find any apparent error in the order of the Tribunal. Hence, Miscellaneous Applications are rejected.
5. In the result, all the three Miscellaneous Applications filed by the assessee are dismissed.
Order pronounced in the open court on 27-01-2021
Sd/- Sd/-
(RAJPAL YADAV) (AMARJIT SINGH)
VICE PRESIDENT ACCOUNTANT MEMBER
Ahmedabad : Dated 27/01/2021
M.A. Nos. 226, 227 228/Ahd/2018 A.Y. 2009-10 & 2010-11 Page No 5
Late Shri Bholidas T Patel vs. ACIT
आदे श क त ल प अ े षत / Copy of Order Forwarded to:-
1. Assessee
2. Revenue
3. Concerned CIT
4. CIT (A)
5. DR, ITAT, Ahmedabad
6. Guard file.
By order/आदे श से,
उप/सहायक पंजीकार
आयकर अपील य अ धकरण,
अहमदाबाद