JAYESH VINODKUMAR TANNA,MUMBAI vs. ACIT-25(3), MUMBAI

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ITA 1152/MUM/2023Status: DisposedITAT Mumbai23 October 2023AY 2007-084 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that since the addition made under Section 143(3) was already included in the total income computed by the Settlement Commission, sustaining the addition by the CIT(A) was not justified.

What were the facts?

The Assessing Officer made an addition of Rs. 13,60,000/- under Section 68 for unexplained cash deposits. Subsequently, a search action was conducted, and the assessee filed an application before the Income Tax Settlement Commission.

What were the issues?

Whether the addition made by the AO under Section 68 is justified when the same income was subsequently offered and accepted by the Settlement Commission.

Which sections of the Income-tax Act were involved?

Section 68,Section 143(3),Section 153A,Section 245C,Section 245D(4)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” BENCH, MUMBAI

Hearing: 10.10.2023Pronounced: 23.10.2023

आदेश / O R D E R Per Amarjit Singh (AM): This appeal filed by the assesse is directed against the order passed by the ld. CIT(A) NFAC, dated 15.03.2023 for A.Y. 2007-08. The assessee has raised the following grounds before us: “1. On the facts and circumstances of the Appellant's case and in law the Ld. Commissioner of Income Tax (Appeals) erred in confirming the addition of Rs.13,60,000/- made by invoking the provisions of Section 68 of the Income Tax Act, 1961 without appreciating the fact that the appellant has offered the said amount as income in application filed and accepted u/s 245C(1) of the Act before the Hon'ble Income Tax Settlement Commission.

1.

2. On the facts and circumstances of the Appellant's case and in law the Ld. Commissioner of Income Tax (Appeals) erred in not accepting the appeal filed before him as infructuous due to the fact that addition P a g e | Jayesh Vinodkumar Tanna Vs. ACIT-25(3) made in the order u/s 143(3) of the Act was offered as income in application filed and accepted u/s 245C(1) of the Act before the Hon'ble Income Tax Settlement Commission, thereby lending the appeal filed before the Hon'ble Commissioner of Income Tax (Appeal) as infructuous.

3.

The Appellant craves leaves to add, to amend, alter, modify and / or withdraw any or all of the above grounds of appeal, each of which are without prejudice to one another.

2.

Fact in brief is that return of income declaring total income of Rs.15,34,792/- was filed on 30.10.2007. During the course of assessment the assessing officer noticed that there was cash deposit transaction of Rs.13,60,000/- in the bank account of the assessee maintained with KapalCo-operative Bank on 31.03.2007. Since the assessee has not filed any reply therefore, the assessing officer has treated the amount as undisclosed income u/s 68 of the Act.

3. The assessee filed the appeal before the ld. CIT(A). The ld. CIT(A) has dismissed the appeal of the assessee. 4. During the course of appellate proceedings before us the ld. Counsel submitted that a search action u/s 132 of the Act was carried in the case of the assesseeand his group concerns on 10.09.2009. Since, search action was carried out, therefore, assessment proceedings initiated u/s 143(3) get abatedhowever, the AO has made invalid assessment u/s 143(3) of the Act on 23.12.2009 and made addition of Rs.13,60,000/-. The assessing officer has also issued noticed u/s 153A of the Act and against the proceedings initiated u/s 153A of the Act the assessee has filed application before the settlement commission. The settlement commission has passed order u/s 245D(4) of the Act on 20.06.2022 and computed the total income at Rs.31,61,182/- including the income which has been assessed u/s 143(3) of the Act to the amount of Rs.28,94,792/-.The ld. Counsel submitted that impugned addition made by the AO u/s 143(3) has been included in the income determined by the settlement commission P a g e | Jayesh Vinodkumar Tanna Vs. ACIT-25(3) therefore the decision of the ld. CIT(A) for sustaining such addition is not justified. On the other hand, the ld. D.R supported the order of lower authorities.

5.

Heard both the sides and perused the material on record. Before completion of assessment proceedings u/s 143(3) of the Act a search and seizure action u/s 132 of the Act has been carried out in the case of the assessee on 10.09.2009. However, the AO has passed order u/s 143(3) of the Act on23.12.2009 in respect of pending assessment proceedings and made addition of Rs.13,60,000/- u/s 68A of the Act on account of cash deposit reflected in the saving bank of the assessee maintained with the Co-operative Bank. As discussed against the assessment proceedings initiated because of search action the assessee has made application before the Income Tax Settlement Commission and the settlement commission has passed order u/s 245D(4) of the Act and determined total income at Rs.31,61,182/- including the income assessed u/s 143(3) of the Act. Considering the above facts that same income has been taxed as per the order of the Settlement Commission therefore, the decision of the ld. CIT(A) in sustaining the impugned addition made u/s 143(3) of the Act is not justified. Accordingly, the grounds of appeal

of the assessee are allowed.

6. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 23.10.2023 Sd/- Sd/- (KuldipSingh) (Amarjit Singh) Judicial Member Accountant Member Place: Mumbai Date 23.10.2023 P a g e | Jayesh Vinodkumar Tanna Vs. ACIT-25(3)

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