MAHESH RAMESHWAR MISTRY,MUMBAI vs. ITO WARD 25(30), MUMBAI

PDF · subscribers
ITA 1191/MUM/2023Status: DisposedITAT Mumbai27 July 2023AY 2012-20133 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 the AO made an addition for unexplained expenditure without issuing a fresh notice under Section 148 of the Act, which was necessary for assessing other income. Therefore, the addition was deleted.

What were the facts?

The assessee's case was reopened based on information that they borrowed Rs. 58,00,000/- in cash. The Assessing Officer (AO) did not add the loan amount but instead added Rs. 96,000/- as unexplained expenditure.

What were the issues?

Whether the AO could make an addition for unexplained expenditure without issuing a fresh notice under Section 148 when the original reason for reopening was different. The validity of addition made without proper notice.

Which sections of the Income-tax Act were involved?

Section 69C,Section 148

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

Detected automatically from the text. Citations are also linked where they appear in the judgment. The count shows how many other judgments on BharatTax rely on the same authority.

Income Tax Appellate Tribunal, “ SMC ” BENCH, MUMBAI

Before: SHRI B R BASKARAN , AM & SHRI N. K. CHOUDHRY, JM

For Appellant: Shri. Vinod Bindal & Satish
For Respondent: Shri. Naganath B. Pasale Ld
Hearing: 17.07.2023Pronounced: 27.07.2023

The Assessee/Appellant herein has preferred this appeal against the order dated 03.03.2023 impugned herein, passed by the Ld. Commissioner of Income Tax (Appeal)/NFAC {in short ‘Ld. Commissioner)’} u/s 250 of the Income Tax Act 1961 (in short ‘the Act’) for the AY 2012-13.

M/s Mahesh Rameshwar Mistry 2. In this case, the case of the Assessee was reopened by recording reasons for re-opening dated 05.07.2019, mainly on the reason that as per information received from the Deputy Directorate of Income Tax (inv) (1) unit-5(4) Mumbai dated 19.03.2019 to the effect that DGIT investigation Mumbai, on the basis of search action u/s 132 of the Act carried out in the case of M/s Evergreen enterprises that undisclosed activity on money lending and borrowing in unaccounted cash loan and interest thereon has arisen. As per the information received, the Assessee has borrowed cash loan of Rs. 58,00,000/- in FY 2011- 12.

3.

In the Assessment order, the AO though has not made any addition on account of the alleged cash loan borrowed amounting to Rs. 58,00,000/- from M/s Evergreen enterprises/Mr. Nilesh Bharani, however, made the addition of Rs. 96,000/- i.e. 12% of Rs. 58,00,000/- the alleged loan borrowed, on the ground that no such expenditure was debited by Assessee in its books of account and consequently, added the same in the total income of the Assessee as unexplained expenditure u/s 69C of the Act. On appeal, the Ld. Commissioner more or less on the same reasoning, confirmed the said addition.

4.

Admittedly, the case of the Assessee was reopened on the reason that the Assessee has taken cash loan of Rs. 58,00,000/- from Ms/ Evergreen Enterprises, however, no addition on that account has been made by the assessing officer but infact the AO assessed some other income without issuing any fresh notice u/s 148 of the Act, which was necessary for assessing other income, therefore in view of the dictum laid down by the Hon’ble High Court of Bombay in the case of CIT-5 Mumbai vs. Jet Airways (I) Ltd. (2010) 195 Taxmann 117 (Bom), We are inclined to delete the addition under consideration hence, the same is deleted. M/s Mahesh Rameshwar Mistry 5. In the result appeal filed by the assessee stands allowed.

Orders pronounced in the open court on 27- 07-2023.

More judgments on Section 69C

All 8,217 judgments and leading authorities on Section 69C →

Recent GST High Court judgments

Search GST case law →