Income Tax Appellate Tribunal - Mumbai
Cheryl J Patel, Mumbai vs Acit Cc13, Mumbai on 7 July, 2020
आयकर अपीलीय अधिकरण "C" न्यायपीठ मुंबई में । IN THE INCOME TAX APPELLATE TRIBUNAL " C" BENCH, MUMBAI श्री महावीर स हिं , उपाध्यक्ष एविं श्री मनोज कुमार अग्रवाल, लेखा दस्य के मक्ष । BEFORE SRI MAHAVIR SINGH, VP AND SRI MANOJ KUMAR AGGARWAL, AM आयकर अपील .िं / ITA No.5544/Mum/2012 ( ननर्ाा र ण वर्ा / Assessment Years 2003-04) Mr. Punit J Patel The Asst. Commissioner of B/27, Clifton Society Near Centuar Income Tax, Central Circle-13 Hotel, Juhu Vile Parele (W), बनाम/ Mumbai Mumbai-49 Vs. (अपीलार्थी / Appellant) (प्रत्यर्थी/ Respondent) स्र्थायी लेखा िं./PAN No. AGRPP9056G आयकर अपील .िं / ITA No .5540/Mum/2012 ( ननर्ाा र ण वर्ा / Assessment Year s 2003-04) आयकर अपील .िं / ITA No.5541/Mum/2012 ( ननर्ाा र ण वर्ा / Assessment Years 2004-05) Mrs. Cheryl J Patel The Asst. Commissioner of B/27, Clifton Society Near Centuar Income Tax, Central Circle-13 Hotel, Juhu Vile Parele (W), बनाम/ Mumbai Mumbai-49 Vs. (अपीलार्थी / Appellant) (प्रत्यर्थी/ Respondent) स्र्थायी लेखा िं./PAN No. AACPP6413A अपीलार्थी की ओर े/ Appellant by : Shri Nishit Gandhi, AR प्रत्यर्थी की ओर े/ Respondent by : Shri Sreekar, CIT DR ुनवाई की तारीख / Date of hearing: 07.07.2020 घोर्णा की तारीख / Date of pronouncement: 07.07.2020 आदे श / O R D E R Page | 2 ITA Nos. 5540, 5541 & 5544/Mum/2012 Mr. Punit J Patel & Mrs. Cheryl J Patel; AYs: 03-04 & 04-05 PER BENCH:
These matters were taken up for hearing through Video Conferencing mode. These three appeals by the two different assessees are arising out of the orders of Commissioner of Income Tax (Appeals)-37, Mumbai in Appeal Nos. CIT(A)- 37/I.T.483 to 489/ACCC-13/11-12 & CIT(A)-37/I.T. 504 to 508/ACCC-13/11-12 even date 27.06.2012. The Assessments were framed by the Asst. Commissioner of Income Tax, Circle 13, Mumbai (in short ACIT/ITO/ AO) for AYs 2003-04, 2004-05 vide dated 16.12.2011, under section 143(3) read with section 153A of the Income-tax Act, 1961 (hereinafter 'the Act').
2. At the outset, the learned Counsel for the assessee stated that he is pressing only ground No. 4.1 to 4.3 and 5 and not pressing the rest of the grounds. On this, the learned CIT Departmental Representative Shri V. Sreekar has not raised any objection.
3. First of all it is stated by the learned counsel that identical issue of jurisdiction is therein in all the three appeals and issue is arising out of the same search conducted. The facts and circumstances are exactly identical in all the appeals i.e. in ITA Nos. 5544,5540 & 5541/Mum/2012 except quantum, hence, we will take the facts from ITA No.5544/Mum/2012 for Assessment Year 2003-04 and decide the issue.
Page | 3 ITA Nos. 5540, 5541 & 5544/Mum/2012 Mr. Punit J Patel & Mrs. Cheryl J Patel; AYs: 03-04 & 04-05 In ITA No.5544/Mum/2012
4. The only issue remains for adjudication in ITA No.5544/Mum/2018 for Assessment Year 2003-04, before us is as regards to the addition made on account of bogus gift received from various parties amounting to ₹14,09,555/-. The relevant ground No.4.1 to 4.3 raised as under: -
"4.1 The ld. CIT(A) erred in confirming the action of the Assessing Officer in making the addition of ₹14,09,555/- to the income of the Appellant on account of alleged bogus gift.
4.2 While doing so, the CIT(A) failed to appreciate that:
(i) the Appellant had duly/ fully explained the source of the gifts received by hi, by placing on record all the relevant documentary evidences;
(ii) all the gifts received by the
Appellant were genuine gifts; and
(iii) the action of the Assessing Officer
in making the alleged addition was based purely on surmises, suspicion and conjectures.
Page | 4 ITA Nos. 5540, 5541 & 5544/Mum/2012 Mr. Punit J Patel & Mrs. Cheryl J Patel; AYs: 03-04 & 04-05 4.3 It is submitted that in the facts and the circumstances of the case, and in law, no such addition was called for."
5. Briefly stated facts are that a search under section 132 of the Act was conducted in the case of Shri Jayant B. Patel and connected persons including assessee on 10.01.2007, consequent to this search, certain materials were found and additions were made which were subject matter challenged before but not challenged by assessee rather these grounds are withdrawal as noted above.
6. The only issue before us remains is of unexplained gifts received by assessee and addition made by Assessing Officer of ₹15,59,555/-, whereas CIT(A) confirmed the addition of ₹14,09,555/- after allowing relief of ₹1.5 lacs.
7. Before us the learned Counsel for the assessee stated that assessee has shown this gift of ₹15,59,555/- in his computation of income filed along with return of income for Assessment Year 2003-04 filed originally on 30.09.2003. Subsequently in response to notice under section 153A of the Act, the assessee filed its return of income on 19.05.2008. In the original return of income, the assessee specifically filed name and address and PAN No. of the person giving gifts. The learned Counsel for the assessee before us now stated and took us through the assessment order and argued that no incriminating material was found during the course of search in respect to these unexplained gifts rather these gifts are declared in the return of Page | 5 ITA Nos. 5540, 5541 & 5544/Mum/2012 Mr. Punit J Patel & Mrs. Cheryl J Patel; AYs: 03-04 & 04-05 income filed originally by the assessee on 30.09.2003 before the date of search i.e. 10.01.2007. The learned Counsel for the assessee stated that once there is no incriminating material, the issue is squarely covered by the decision of Hon'ble Bombay High Court in the case of CIT vs Continental Warehousing Corporation (Nhava Sheva) Ltd. (2015) 374 ITR 645 (Bom) and moreover, the issue is squarely covered in assessee's group case i.e. Jayant B. Patel in ITA Nos.5549 to 5552, 5554/Mum/2012 & 7524/Mum/2013 for AYs :2001-02 to 2007- 08 order dated 10.08.2016, wherein the Tribunal has considered this issue in great detail in Paras 17 to 26. Finally, Tribunal held as under: -
"Respectfully following the proposition of law discussed in the above judicial pronouncements, we do not find any merit for the addition made by the AO with respect to gifts received by assessee in A.Y.2003-04 & 2004-05, which were not pending on the date of search and no incriminating material was found during search with regard to these gifts. Accordingly, addition of gifts made by AO when no incriminating materials was found during the course of search is not sustainable. The AO is directed to delete the same. Since we have already decided the legal issues in favour of the assessee, we Page | 6 ITA Nos. 5540, 5541 & 5544/Mum/2012 Mr. Punit J Patel & Mrs. Cheryl J Patel; AYs: 03-04 & 04-05 are not going into merit of the addition made on account of gifts"
8. When this was pointed out to the learned CIT Departmental Representative Shri V. Sreekar, he could not controvert the above argument made by the leaned Counsel for the assessee nor could produce or made a statement that any incriminating material is available in the record of the Assessing Officer. Therefore, once there is no incriminating material, the issue is squarely covered in favour of assessee and against Revenue by the decision of Hon'ble Bombay High court in the case of Continental Warehousing Corporation (supra). Resultantly, this issue of assessee's appeal is allowed.
9. Similarly, in ITA Nos 5540 & 5541/Mum/2012 for Assessment Years 2003-04 & 2004-05, the facts and circumstances are exactly identical and the grounds are also the same as regards bogus gift. Taking a consistent view, we allow these grounds raised by the assessee.
10. Coming to Ground No.5, in ITA No. 5544/Mum/2012 is as regards to the order of CIT(A) in charging of interest under section 234A and 234B of the Act.
11. This is being a consequential ground, the Assessing Officer will consider the argument of the assessee afresh and then will decide this issue. Hence, we remand the matter back to the file of the Assessing Officer for fresh adjudication.
Page | 7 ITA Nos. 5540, 5541 & 5544/Mum/2012 Mr. Punit J Patel & Mrs. Cheryl J Patel; AYs: 03-04 & 04-05
12. Similar are the facts in ITA No.5540 & 5541/Mum/2012 for Assessment Years 2003-04 & 2004-05, the facts and circumstances are exactly identical and taking a consistent view, we restore this issue of interest in these appeals to the file of the learned AO.
13. In the result, the appeals of assessee are partly allowed.
Order pronounced in the open court on 07.07.2020 Sd/- Sd/-
(मनोज कुमार अग्रवाल / MANOJ KUMAR AGGARWAL) (महावीर स ह िं /MAHAVIR SINGH) (लेखा दस्य / ACCOUNTANT MEMBER) (उपाध्यक्ष / VICE PRESIDENT) मुिंबई, ददनािंक/ Mumbai, Dated: 07. 07.2020 ुदीप रकार, व. ननजी चिव/ Sudip Sarkar, Sr.PS आदे श की प्रतिललपप अग्रेपिि/Copy of the Order forwarded to :
1. अपीलार्थी / The Appellant
2. प्रत्यर्थी / The Respondent.
3. आयकर आयक् ु त(अपील) / The CIT(A)
4. आयकर आयुक्त / CIT
5. ववभागीय प्रनतननचर्, आयकर अपीलीय अचर्करण, मुिंबई / DR, ITAT, Mumbai
6. गार्ा फाईल / Guard file.
आदे शानसार/ BY ORDER, त्यावपत प्रनत //True Copy// उप/सहायक पुंजीकार (Asstt. Registrar) आयकर अपीलीय अधिकरण, मिंब ु ई / ITAT, Mumbai