Income Tax Appellate Tribunal - Pune
Rajesh Madanlal Partani, Pune vs Acit Cent. Cir. 1(2),, Pune on 6 September, 2019
IN THE INCOME TAX APPELLATE TRIBUNAL
PUNE BENCH "B", PUNE
BEFORE SHRI R.S. SYAL, VICE PRESIDENT AND
SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER
आयकर अपील सं. / ITA Nos.1016 & 1017/PUN/2012
िनधा रण वष / Assessment Years : 2001-02 & 2002-03
Rajesh Madanlal Partani Vs. ACIT, Central Circle-1(2),
Plot No.25/6 Pune
New Mangalwar Peth
Pune - 411 011
PAN : AIMPP 1592L
आयकर अपील सं. / ITA Nos.850 to 855/PUN/2012
िनधा रण वष / Assessment Years : 2003-04 to 2008-09
Rajesh Madanlal Partani Vs. ACIT, Central Circle-1(2),
Plot No.25/6 Pune
New Mangalwar Peth
Pune - 411 011
PAN : AIMPP 1592L
आयकर अपील सं. / ITA Nos.504 to 506/PUN/2012
िनधा रण वष / Assessment Years : 2001-02, 2002-03 & 2005-06
Rajesh Madanlal Partani (HUF) Vs. ACIT, Central Circle-1(2),
Final Plot No.25/6 Pune
New Mangalwar Peth
Pune - 411 011
PAN : AAGHP4475A
आयकर अपील सं. / ITA Nos.1761 to 1763/PUN/2012
िनधा रण वष / Assessment Years : 2006-07 to 2008-09
Rajesh Madanlal Partani, Vs. ACIT, Central Circle-1(2),
Plot No.25/6 Pune
New Mangalwar Peth
Pune - 411 011
PAN : AIMPP1592L
2
Partani group cases
आयकर अपील सं. / ITA Nos.507 & 508/PUN/2012
िनधा रण वष / Assessment Years : 2001-02 & 2002-03
Madanlal Gangadhar Partani Vs. ACIT, Central Circle-1(2),
(HUF), Pune
Final Plot No.25/6
New Mangalwar Peth
Pune - 411 011
PAN : AAGHP4477C
आयकर अपील सं. / ITA Nos.509 & 510/PUN/2012
िनधा रण वष / Assessment Years : 2001-02 & 2002-03
Nitin Madanlal Partani (HUF), Vs. ACIT, Central Circle-1(2),
Final Plot No.25/6 Pune
New Mangalwar Peth
Pune - 411 011
PAN : AAGHP4476D
आयकर अपील सं. / ITA Nos.1018 to 1025/PUN/2012
िनधा रण वष / Assessment Years : 2001-02 to & 2008-09
Madanlal Gangadhar Partani, Vs. ACIT, Central Circle-1(2),
Final Plot No.25/6 Pune
New Mangalwar Peth
Pune - 411 011
PAN : AAVPP4480E
आयकर अपील सं. / ITA Nos.499 to 503/PUN/2012
िनधा रण वष / Assessment Years : 2002-03, 2004-05 to 2007-08
Partani Udyog Pvt. Ltd. Vs. ACIT, Central Circle-1(2),
Final Plot No.25/6 Pune
New Mangalwar Peth
Pune - 411 011
PAN : AADCP2787
Assessee by Shri Hari Krishan
Revenue by Shri Pankaj Garg
Date of hearing 05-09-2019
Date of pronouncement 06-09-2019
3
Partani group cases
आदेश / ORDER
PER BENCH:
This batch of 31 appeals contains 28 quantum appeals and 3 appeals against penalty imposed u/s.271B of the Income-tax Act, 1961 (hereinafter called 'the Act') by different but connected assessees for the years captioned above. As some common issues are involved in these appeals, we are, therefore, proceeding to dispose them off by this consolidated order.
2. The first legal ground raised in lead appeal by Sh. Rajesh Madanlal Partani for the assessment year 2005-06 (ITA No.852/PUN/2012), which is common in almost all the quantum appeals, is against failure to issue and service notice upon the assessee u/s.143(2) of the Act within the time prescribed. On an earlier occasion, this ground was not pressed on behalf of the assessee. However, the assessee has again chosen to press this ground of appeal. The ld. Counsel submitted that notice u/s.143(2) was not issued within the stipulated period of six months before completing the assessment u/s.153A r.w.s. 143(3) of the Act. This was factually controverted by the ld. DR who submitted that the first notice u/s.143(2) was issued in time.
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Partani group cases
3. We have briefly heard the parties on this issue. The ld. AR fairly pointed out that the Third Member bench of the Mumbai Tribunal in Smt. Sumanlala Bansal vs. ACIT (TM) vide its order dt. 20.5.2015 (ITA no. 525-530/Mum/2008), following the direct judgment of the Hon'ble Delhi High Court in Ashok Chaddha vs. ITO (2011) 337 ITR 399 (Del), has held that non-issuance of notice u/s 143(2) is not a requirement for completing assessment u/s 153A. However, relying on another judgment in CIT VS. N.S. Software (Firm) (2018) 403 ITR 0259 (Delhi), the ld. AR contended that the provisions of section 143(2) apply to the proceedings u/s 153A as well, even though it was not a direct issue before the Hon'ble High Court. In view of the fact that the ld. DR contended that the first notice u/s 143(2) of the Act was, in fact, issued within the stipulated period and further that the ld. AR also evinced interest in keeping the issue alive to be taken up before the higher forums rather than extensively arguing before the Tribunal, we decide this issue against the assessee without going further deep into it.
ITA Nos.850-855/PUN/2012 and 1016-17/PUN/2012 -Shri Rajesh Madanlal Partani
4. Briefly stated, the facts of the lead year 2005-06 (in ITA No.852/PUN/2012) which are mutatis mutandis similar to the other seven quantum appeals are that the assessee is a member of Partani 5 Partani group cases group in which a survey was initially conducted u/s.133A of the Act on 04-07-2007, which was converted into search u/s.132 on the same day. The Partani group is engaged in doing business on commission agency and financing of auto rickshaw vehicles through personal finance as well as finance through Shree Gangadhar Nagari Sahakari Pat Sanstha. Sixteen diaries were found during the course of search and seizure containing details regarding old and new vehicles arranged by the assessee. It had further details of the commission received from each transaction, finances made to the borrowers and interest etc. Statement of the assessee was recorded on 04-07-2007. The assessee made a surrender of Rs.2.00 crore spread over certain years in his individual hands, however the same was not fully offered in the returns filed pursuant to the search. The assessee filed his return for the lead year at total income of Rs.31,55,980/- including the amount surrendered for the year at Rs.26,02,000/-, but the assessment was completed at a total income of Rs.1,63,73,720/- making additions on account of suppressed commission income of Rs.83.78,812/-; interest income of Rs.55,87,963/-; suppressed profit of Rs.14,63,000/-; and suppressed interest of Rs.3,88,967/-. The assessee appealed before the ld. CIT(A) but remained unrepresented, as a result of which this appeal and host of other appeals came to be decided ex parte qua the 6 Partani group cases respective assesses. This is how, the assessee has approached the Tribunal.
5. We have heard the rival submissions and considered the relevant material on record. It is seen that the ld. CIT(A) fixed the appeal of the assessee for hearing on 14-10-2010. Adjournment was sought, which was granted for 22-11-2010. Series of adjournments were taken by the assessee as has been recorded in para 3 of the impugned order. Since the assessee could not represent himself before the ld. CIT(A), the ld. first appellate authority was left with no alternate option but to proceed with the material available on record. That is how, most of the additions came to be countenanced by the ld. CIT(A). The ld. AR contended that the assessee's father was not keeping good health during the course of relevant proceedings which prevented him from putting in appearance before the ld. CIT(A).
6. The ld. DR vehemently argued that the assessee was given proper opportunity by the ld. CIT(A) but the assessee failed to avail the same. It was thus prayed that the appeals of the assessee be dismissed. It was further pointed out by him that the assessment was getting time barred but the assessee failed to adduce the evidence in time enabling the AO to embark upon proper enquiry. It was thus prayed that the additions so made and sustained be confirmed. 7
Partani group cases
7. Both the sides admitted that the facts and circumstances of the other seven appeals are almost similar on merits.
8. In view of the fact that the assessee was prevented by reasonable cause from appearing before the ld. CIT(A) as his father was not well and the fact that the AO could not properly appreciate the evidence because of limitation period setting in, both the sides fairly agreed that it would be in the interest of justice if the impugned orders are set- aside and the matter is restored to the file of AO. Considering the totality of the facts and circumstances of the instant case, we are satisfied that the assessee deserves to be given one more chance to present his case before the AO. We order accordingly. Setting aside the impugned orders, we direct the AO to frame the assessments for the years under consideration afresh as per law after allowing reasonable opportunity of hearing to the assessee.
9. In the result, all the eight appeals are allowed for statistical purposes.
ITA Nos. 499 to 503/PUN/2012 - Partani Udyog Pvt. Ltd., ITA Nos. 504 & 505/PUN/2012 - Rajesh M. Partani (HUF) ITA Nos. 507 & 508/PUN/2012 - Madanlal Gangadhar Partani (HUF) ITA Nos. 509 & 510/PUN/2012 - Nitin Madanlal Partani (HUF) ITA Nos. 1018 & 1019/PUN/2012 - Madanlal Gangadhar Partani 8 Partani group cases
10. Apart from the legal issue which we have discussed herein above, the only issue raised in these appeals is against the estimation of commission income.
11. Both the sides are in agreement that the commission income has been estimated in the same way as has been done in the case of Sh. Rajesh Madanlal Partani in the lead case as discussed supra. Following the same view, we set-aside the impugned orders and remit the matter to the file of the respective AOs for fresh decision. Needless to say, the assessee will be allowed reasonable opportunity of hearing to the assessee.
12. In the result, all the above appeals are allowed for statistical purposes.
ITA Nos. 506/PUN/2012 - Rajesh M. Partani (HUF)
13. This appeal was not pressed by the ld. AR. The same is, therefore, dismissed.
ITA Nos. 1020 to 1025/PUN/2012 - Madanlal G. Partani
14. These six appeals by Sh. Madanlal Gangadhar Partani relate to the A.Yrs. 2003-04 to 2008-09. A common issue raised in all these six 9 Partani group cases appeals is against the confirmation of addition on account of cash deposited in the bank account.
15. Briefly stated, the facts for the A.Y. 2003-04 are that the AO, on perusal of statement of S.B. A/c. No.8166 maintained by the assessee with Mahesh Sahkari Bank, Raviwar Peth, Pune observed that the assessee deposited cash of Rs.52,000/-, Rs.11,500/-, Rs.11,500/-, Rs.11,500/-, Rs.12,000/-, Rs.12,000/-, Rs.11,500/- on 13-05-2002, 15-07-2002, 06-08-2002, 16-08-2002, 16-09-2002, 17-09-2002 and 16-10-2002 respectively. Total of such cash deposits came at Rs.1,22,000/-. In the absence of the assessee furnishing any explanation about the source of such cash deposits, the AO made addition, which came to be confirmed in the first appeal.
16. The ld. AR submitted that the said bank account is a part of the assessee's regular books of account maintained prior to search and has been properly reflected in the Balance sheet as well. The ld. AR submitted that all the entries of cash deposits find place in the regular books of account.
17. Having heard both the sides and gone through the relevant material on record, it is seen that the AO made the addition simply by considering the amounts of cash deposits on different dates in the 10 Partani group cases bank account. Addition on account of cash deposits can be made only if the source of the deposits remains unexplained. If, on the other hand, the cash deposits in the bank are from the regular books of account maintained by the assessee, then such transactions cannot be said to be unexplained. The ld. AR has taken the argument that the said bank account is part of the assessee's regular books of account which was reflected in the balance sheet prior to the date of search. Under these circumstances, we set-aside the impugned order and remit the matter to the file of AO for examining if all the transactions, for which the addition has been made, were reflected in the assessee's regular books of account maintained prior to the date of search. In case such entries find their place in the regular books of account maintained prior to the date of search, then obviously no addition can be made. In the otherwise scenario, the AO will consider the issue afresh as per law.
18. Facts and circumstances of the other five appeals are stated to be mutatis mutandis similar.
19. In the result, all these appeals are allowed for statistical purposes.
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Partani group cases ITA Nos.1761 to 1763/PUN/2012 -Shri Rajesh Madanlal Partani
20. These appeals are directed against the confirmation of penalty u/s.271B of the Act in relation to the A.Ys. 2006-07 to 2008-09.
21. We have heard both the sides and gone through the relevant material on record. It is a common submission by both the sides that the quantum of penalty in these appeals is dependent upon the gross receipts in the quantum assessment, which issue we have restored above for fresh adjudication. Consequently, the impugned orders are set aside and the penalty matters are also sent back to the AO for considering the amount of gross receipts to be finally includible in the fresh determination of income of the assessee and then ascertaining the correct amount of penalty leviable, if any.
22. In the result, these three appeals are allowed for statistical purposes.
Order pronounced in the Open Court on 06th September, 2019.
Sd/- Sd/-
(PARTHA SARATHI CHAUDHURY) (R.S.SYAL)
JUDICIAL MEMBER VICE PRESIDENT
पुणे Pune; दनांक Dated : 06th September, 2019 सतीश 12 Partani group cases आदेश क ितिलिप अ िे षत/Copy षत of the Order is forwarded to:
1. अपीलाथ / The Appellant;
2. यथ / The Respondent;
3. The CIT(A) Central, Pune
4. The CIT (Central), Pune
5. िवभागीय ितिनिध, आयकर अपीलीय अिधकरण, पुणे "बी" / DR 'B', ITAT, Pune;
6.
गाड फाईल / Guard file.
आदेशानुसार/ ार BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण ,पुणे / ITAT, Pune Date
1. Draft dictated on 05-09-2019 Sr.PS
2. Draft placed before author 06-09-2019 Sr.PS
3. Draft proposed & placed JM before the second member
4. Draft discussed/approved JM by Second Member.
5. Approved Draft comes to Sr.PS the Sr.PS/PS
6. Kept for pronouncement on Sr.PS
7. Date of uploading order Sr.PS
8. File sent to the Bench Clerk Sr.PS
9. Date on which file goes to the Head Clerk
10. Date on which file goes to the A.R.
11. Date of dispatch of Order.
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