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Income Tax Appellate Tribunal, MUMBAI BENCH “G” MUMBAI
Before: SHRI OM PRAKASH KANT & MS. KAVITHA RAJAGOPAL
PER OM PRAKASH KANT, AM
This appeal has been preferred by the assessee against order dated 06.12.2022 passed by the Ld. Commissioner of Income-tax (Appeals) – National Faceless Appeal Centre, Delhi [in short ‘the Ld. CIT(A)’] for assessment year 2016-17, raising following grounds:
On the facts and circumstances of the case and law, the Ld. CIT(A) erred in confirming disallowing of business loss of Rs. 89,461.
Sunil Mohanlal Lahori Sunil Mohanlal Lahori 2 ITA No. No. 283/M/2023
On the facts and circumstances of the case and law, the Ld. 2. On the facts and circumstances of the case and law, the Ld. 2. On the facts and circumstances of the case and law, the Ld. CIT(A) erred in dismissing the appeal without adjudicating the CIT(A) erred in dismissing the appeal without adjudicating the CIT(A) erred in dismissing the appeal without adjudicating the grounds of appeal related to addition of sundry creditors grounds of appeal related to addition of sundry creditors grounds of appeal related to addition of sundry creditors under under under section section section 68, 68, 68, disallowance disallowance disallowance of of of Brokerage Brokerage Brokerage and and and disallowance of deduction under section 54F of Income Tax e of deduction under section 54F of Income Tax e of deduction under section 54F of Income Tax Act, 1961. 3. On the facts and circumstances of the case and law, the Ld. 3. On the facts and circumstances of the case and law, the Ld. 3. On the facts and circumstances of the case and law, the Ld. CIT(A) erred in confirming addition of Rs.2,54,47473/ CIT(A) erred in confirming addition of Rs.2,54,47473/ CIT(A) erred in confirming addition of Rs.2,54,47473/- on account of increase of sundry creditors under section 68 of account of increase of sundry creditors under section 68 of account of increase of sundry creditors under section 68 of Income Tax Act, Income Tax Act, 1961. 4. On the facts and circumstances of the case and law, the 4. On the facts and circumstances of the case and law, the 4. On the facts and circumstances of the case and law, the CIT(A) erred in confirming disallowance of brokerage of Rs. CIT(A) erred in confirming disallowance of brokerage of Rs. CIT(A) erred in confirming disallowance of brokerage of Rs. 11,00,000/- under section 48 of Income Tax Act, 1961. under section 48 of Income Tax Act, 1961. 5. On the facts and circumstances of the case and law, the Ld. 5. On the facts and circumstances of the case and law, the Ld. 5. On the facts and circumstances of the case and law, the Ld. CIT(A) erred i CIT(A) erred in confirming restriction of deduction under n confirming restriction of deduction under section 54F to Rs. 1,36,50,000 as against claimed by section 54F to Rs. 1,36,50,000 as against claimed by section 54F to Rs. 1,36,50,000 as against claimed by appellant at Rs. 2,41,73,404. appellant at Rs. 2,41,73,404. 2. Briefly stated, facts of the case are that the assessee filed his Briefly stated, facts of the case are that the assessee filed his Briefly stated, facts of the case are that the assessee filed his return of income for the year under consideration on 17.10.2016 return of income for the year under consideration on 17.10.2 return of income for the year under consideration on 17.10.2 declaring total income declaring total income at Rs.63,13,880/-. The return of income filed . The return of income filed by the assessee was selected for scrutiny and statutory notices by the assessee was selected for scrutiny and statutory notices by the assessee was selected for scrutiny and statutory notices under the Income-tax Act, 1961 (in short ‘the Act’) were issued and tax Act, 1961 (in short ‘the Act’) were issued and tax Act, 1961 (in short ‘the Act’) were issued and complied with. In the assessment completed u/s 143(3) of the Act complied with. In the assessment completed u/s 143( complied with. In the assessment completed u/s 143( on on on 28.12.2018, 28.12.2018, 28.12.2018, the the the Assessing Assessing Assessing Officer Officer Officer made made made certain certain certain disallowance/additions to the returned income. disallowance/additions to the returned income.
On further appeal, the Ld. CIT(A) allowed the appeal partly. On further appeal, the Ld. CIT(A) allowed the appeal partly. On further appeal, the Ld. CIT(A) allowed the appeal partly. However, in view of non However, in view of non-compliance by the assessee, he assessee, he decided few issues on ex-parte basis basis invoking the decision of the Tribunal invoking the decision of the Tribunal in the case of CIT v. Multiplan India Ltd. reported in 38 v. Multiplan India Ltd. reported in 38-ITD-320. The v. Multiplan India Ltd. reported in 38 relevant finding of the Ld. CIT(A) is reproduced as under: relevant finding of the Ld. CIT(A) is reproduced as under: relevant finding of the Ld. CIT(A) is reproduced as under:
Sunil Mohanlal Lahori Sunil Mohanlal Lahori 3 ITA No. No. 283/M/2023
“8. Finding on Ground of Appeal No. 2,3 and 6 8. Finding on Ground of Appeal No. 2,3 and 6 8. Finding on Ground of Appeal No. 2,3 and 6 The aforesaid non compliances The aforesaid non compliances reveals beyond doubt that the reveals beyond doubt that the appellant has nothing to say in the matter of these Grounds of appellant has nothing to say in the matter of these Grounds of appellant has nothing to say in the matter of these Grounds of Appeal in the present appeal. Thus, it appears that the Appeal in the present appeal. Thus, it appears that the Appeal in the present appeal. Thus, it appears that the assessee is not interested in prosecution of these Grounds of assessee is not interested in prosecution of these Grounds of assessee is not interested in prosecution of these Grounds of Appeal in the present appeal and Appeal in the present appeal andthese grounds of appeal are s of appeal are liable to be dismissed on this ground itself.The law assists liable to be dismissed on this ground itself.The law assists liable to be dismissed on this ground itself.The law assists those who are vigilant and not those who sleep over their those who are vigilant and not those who sleep over their those who are vigilant and not those who sleep over their rights. This principle is embodied in the well known rights. This principle is embodied in the well known rights. This principle is embodied in the well known dictum"VIGILATIBUS, dictum"VIGILATIBUS, dictum"VIGILATIBUS, NON NON NON DORMENTIBUS,JURASUBVENIUNT"Considering, the DORMENTIBUS,JURASUBVENIUNT"Considering, the DORMENTIBUS,JURASUBVENIUNT"Considering, the facts and relying on the decision of the Hon'ble, ITAT, Delhi Bench, in relying on the decision of the Hon'ble, ITAT, Delhi Bench, in relying on the decision of the Hon'ble, ITAT, Delhi Bench, in the case of CIT vs Multiplan India It. reported in 38 the case of CIT vs Multiplan India It. reported in 38 the case of CIT vs Multiplan India It. reported in 38-ITD-320 and the judgment of the Hon'ble Madhya Pradesh High Court and the judgment of the Hon'ble Madhya Pradesh High Court and the judgment of the Hon'ble Madhya Pradesh High Court in the case of Estate of Late Tukoji Rao Holker vs. CWT (1997) in the case of Estate of Late Tukoji Rao Holker vs. CWT (1997) in the case of Estate of Late Tukoji Rao Holker vs. CWT (1997) reported in223 eported in223-ITR-480, the Grounds of Appeal No. 2,3 & 6 480, the Grounds of Appeal No. 2,3 & 6 are are are hereby hereby hereby dismissed.Thus, dismissed.Thus, dismissed.Thus, the the the below below below mentionedadditions/disallowances made by the AO are mentionedadditions/disallowances made by the AO are mentionedadditions/disallowances made by the AO are hereby confirmed. hereby confirmed. • Addition of Sundry Creditors us 68 • Addition of Sundry Creditors us 68 - Rs.2,54,47,473/ Rs.2,54,47,473/- (GOA- 2) • Disallowance of brokerage/ • Disallowance of brokerage/Commission - Rs.11,00,000/ Rs.11,00,000/- (GOANo.3) • Disallowance of deduction u/s 54F • Disallowance of deduction u/s 54F - Rs. 1,36,50,000/ Rs. 1,36,50,000/- (GOA-6)” 4. Before us, the Ld. Counsel of the Before us, the Ld. Counsel of the assessee filed a Paper Book filed a Paper Book containing pages 1 to 51 and also filed an affidavit submitting the containing pages 1 to 51 and also filed an affidavit containing pages 1 to 51 and also filed an affidavit reasons for non-compliance before the Ld. CIT(A). The relevant part compliance before the Ld. CIT(A). The relevant part compliance before the Ld. CIT(A). The relevant part of the affidavit filed by the authorized representative of the assessee of the affidavit filed by the authorized representative of the assessee of the affidavit filed by the authorized representative of the assessee is reproduced as under: is reproduced as under:
“I Himanshu Gandhi (Authorized Presentative of Mr. Sunil I Himanshu Gandhi (Authorized Presentative of Mr. Sunil I Himanshu Gandhi (Authorized Presentative of Mr. Sunil Mohan Lahori, age Mohan Lahori, age-31, having office address at 16th Floor, D office address at 16th Floor, D
Sunil Mohanlal Lahori Sunil Mohanlal Lahori 4 ITA No. No. 283/M/2023
Wing, Trade World Tower, kamala mills, compound, Lower Wing, Trade World Tower, kamala mills, compound, Lower Wing, Trade World Tower, kamala mills, compound, Lower Parel (W), Mumbai Parel (W), Mumbai-400013 would like to state as under: 400013 would like to state as under: a) Originally appeal was filed before the CIT(A) a) Originally appeal was filed before the CIT(A)- -33, Mumbai and case was fixed for hearing in February 2020. That and case was fixed for hearing in February 2020. That and case was fixed for hearing in February 2020. That time I personally appeared before the Ld. CIT(A) personally appeared before the Ld. CIT(A) -33 Mumbai office 33 Mumbai office at Kautilya Bhavan, BKC, Mumbai. But due to COVID the at Kautilya Bhavan, BKC, Mumbai. But due to COVID the at Kautilya Bhavan, BKC, Mumbai. But due to COVID the hearing was not heard. hearing was not heard. b) Family of Mr. Sun Mohan Lahori was staying in UAE. And amily of Mr. Sun Mohan Lahori was staying in UAE. And amily of Mr. Sun Mohan Lahori was staying in UAE. And during COVID lockdown we faces various issue due to tr during COVID lockdown we faces various issue due to tr during COVID lockdown we faces various issue due to travel restriction as being a Senior restriction as being a Senior Citizen. So, on 291 September . So, on 291 September 2020 he also left for UAK. 2020 he also left for UAK. c) But unfortunately, on 06th December, 2020 he tested But unfortunately, on 06th December, 2020 he tested But unfortunately, on 06th December, 2020 he tested positive for COVID positive for COVID-19 in UAE. So, he was quarantine in UAE 19 in UAE. So, he was quarantine in UAE for 45 days as per UAE norms. Thereafter he come b for 45 days as per UAE norms. Thereafter he come b for 45 days as per UAE norms. Thereafter he come back to India on 03.01.2021. But after that Second Wave of COVID India on 03.01.2021. But after that Second Wave of COVID India on 03.01.2021. But after that Second Wave of COVID come back in India. come back in India. d) Again Mr. Sunil Mohan Lahori faces health issue in second d) Again Mr. Sunil Mohan Lahori faces health issue in second d) Again Mr. Sunil Mohan Lahori faces health issue in second wave of COVID and could attend the office being a Senior wave of COVID and could attend the office being a Senior wave of COVID and could attend the office being a Senior Citizen. In that duration the Faceless appeal hearing Citizen. In that duration the Faceless appeal hearing Citizen. In that duration the Faceless appeal hearing notices was issued and he was not aware. was issued and he was not aware. e) Further Mr. Anand, accountant of appellant firm has left the e) Further Mr. Anand, accountant of appellant firm has left the e) Further Mr. Anand, accountant of appellant firm has left the job due to late payment of salary as Mr. Sunil Mohan Lahori job due to late payment of salary as Mr. Sunil Mohan Lahori job due to late payment of salary as Mr. Sunil Mohan Lahori was under financial crises and therefore, he has not informed was under financial crises and therefore, he has not informed was under financial crises and therefore, he has not informed about hearing notices to me. about hearing notices to me. f) Due to above facts the assessee was prevented from ) Due to above facts the assessee was prevented from ) Due to above facts the assessee was prevented from reasonable cause for non reasonable cause for non-furnishing the written submission furnishing the written submission before the National Faceless Appeal Centre, Delhi. before the National Faceless Appeal Centre, Delhi. before the National Faceless Appeal Centre, Delhi. g) Under the aforesaid circumstances, the we submits that the g) Under the aforesaid circumstances, the we submits that the g) Under the aforesaid circumstances, the we submits that the non-filling of submission was filling of submission was unintentional. In view of above and in the interest of justice, We request your In view of above and in the interest of justice, We request your In view of above and in the interest of justice, We request your honour to kindly restore the Ground No. 2, 3 and 6 raised honour to kindly restore the Ground No. 2, 3 and 6 raised honour to kindly restore the Ground No. 2, 3 and 6 raised before CIT(A) to NAFC for fresh adjudication in the interest of before CIT(A) to NAFC for fresh adjudication in the interest of before CIT(A) to NAFC for fresh adjudication in the interest of justice and equity as the issue are not adiudicated on justice and equity as the issue are not adiudicated on justice and equity as the issue are not adiudicated on merit by the Ld. CIT(A). We shall remain grateful for this act of the Ld. CIT(A). We shall remain grateful for this act of the Ld. CIT(A). We shall remain grateful for this act of kindness.”
Sunil Mohanlal Lahori Sunil Mohanlal Lahori 5 ITA No. No. 283/M/2023
4.1 Before us, the Ld. Counsel of the assessee submitted that Before us, the Ld. Counsel of the assessee submitted that Before us, the Ld. Counsel of the assessee submitted that assessee was prevented from furnishing the written submission assessee was prevented from furnishing the written submission assessee was prevented from furnishing the written submission before the Ld. CIT(A) due to unavoidable circumstances and before the Ld. CIT(A) due to unavoidable circumstances and before the Ld. CIT(A) due to unavoidable circumstances and therefore matter might be restored back to the file of the Ld. therefore matter might be restored back to the file of the Ld. therefore matter might be restored back to the file of the Ld. Assessing Officer.
The Ld. Departmental Representative (DR) did not seriously The Ld. Departmental Representative (DR) did not seriously The Ld. Departmental Representative (DR) did not seriously object to the plea of the assessee. object to the plea of the assessee.
In the facts and circumstances of the case, the Ld. CIT(A) has In the facts and circumstances of the case, the Ld. CIT(A) has In the facts and circumstances of the case, the Ld. CIT(A) has not adjudicated the issues on merits and only dismissed for default not adjudicated the issues on merits and only dismissed for default not adjudicated the issues on merits and only dismissed for default on the part of the assessee.The Ld. Counsel of the assessee has assessee.The Ld. Counsel of the assessee has assessee.The Ld. Counsel of the assessee has expressed willingness of the assessee for appearing before the Ld. expressed willingness of the assessee for appearing before the Ld. expressed willingness of the assessee for appearing before the Ld. CIT(A) and making submissions before him, CIT(A) and making submissions before him, therefore, we feel it therefore, we feel it appropriate to restore the issue back to the file of the Ld. CIT(A) for appropriate to restore the issue back to the file of the Ld. CIT(A) for appropriate to restore the issue back to the file of the Ld. CIT(A) for deciding afresh after considering submission of the ng afresh after considering submission of the assessee. The ng afresh after considering submission of the grounds of appeal of the grounds of appeal of the assessee are accordingly allowed for are accordingly allowed for statistical purposes.
In the result, the appeal of the assessee is allowed for In the result, the appeal of the assessee is allowed for In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Order pronounced in the open Court on 11/05/2023. /05/2023. Sd/ Sd/- Sd/ Sd/- (KAVITHA RAJAGOPAL KAVITHA RAJAGOPAL) (OM PRAKASH KANT OM PRAKASH KANT) JUDICIAL MEMBER JUDICIAL MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER Mumbai;
Sunil Mohanlal Lahori Sunil Mohanlal Lahori 6 ITA No. No. 283/M/2023
Dated: 11/05/2023 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. BY ORDER, BY ORDER, //True Copy// (Assistant Registrar) (Assistant Registrar) ITAT, Mumbai ITAT, Mumbai