HARBANS B THAPAR,MUMBAI vs. ITO WARD 26(1)(5), MUMBAI

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ITA 1299/MUM/2020Status: DisposedITAT Mumbai08 April 2022AY 2010-114 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that technicalities should not override substantial justice and restored the appeal to the CIT(A) for fresh adjudication. The CIT(A) was directed to admit the additional evidence and provide a reasonable opportunity of hearing.

What were the facts?

The assessee did not file a return for AY 2010-11, leading to a notice under Section 148. The reasons for reopening were allegedly not provided, and the Assessing Officer made an addition as unexplained cash credit. The CIT(A) rejected additional evidence due to a lack of formal application.

What were the issues?

Whether the reopening of assessment was valid without providing reasons and whether the CIT(A) erred in rejecting additional evidence without considering substantial justice.

Which sections of the Income-tax Act were involved?

Section 148,Section 147,Section 144,Section 143(2)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “ SMC”, MUMBAI

Before: SHRI PRAMOD KUMAR, VICE- & SHRI VIKAS AWASTHY

Hearing: 14/01/2022Pronounced: 08/04/2022

आदेश/ ORDER

PER VIKAS AWASTHY, JM:

1.

This appeal by the assessee is directed against the order of Commissioner of Income Tax(Appeals)-38 Mumbai [in short 'the CIT(A)’] dated 13/02/2019 for the assessment year 2010-11.

2.

The assessee in appeal has assailed reopening of assessment as well as addition on merits. The assessee has also raised a ground assailing that the additional evidences filed by the assessee were not accepted by the CIT(A).

3.

The brief facts of the case as emanating from records are: The assessee had not filed any return of income for the Assessment Year 2010-11. Notice u/s. 148 of the Income Tax Act,1961 ( in short 'the Act') was issued to the assessee on 30/03/2017. In response to the notice the assessee filed return of income and also asked for the reasons for reopening the assessment u/s. 147 of the Act. The reasons for reopening were allegedly not provided to the assessee. The Assessing Officer in the assessment order reproduced the reasons for reopening the assessment u/s. 147 of the Act and thereafter, passed the assessment order invoking the provision of section 144 r.w.s. 147 of the Act. The reasons for reopening reveal that the provisions of Section 147 of the Act have been invoked as the assessee has failed to disclose transaction of sale of immovable property wherein the assessee is a co-owner to the extent of ½ share, however, the Assessing Officer made addition of Rs.21,51,802/- i.e. assessee’s share in sale consideration as unexplained cash credit. Aggrieved by the assessment order dated 08/12/2017, the assessee filed appeal before the CIT(A) assailing reopening of assessment, inter-alia, on the following grounds:

(i) The reasons for reopening were not provided to the assessee.

(ii) Mandatory notice issued u/s. 143(2) of the Act after filing of the return was not served on the assessee.

3.1 The assessee had also filed some additional evidences in the form of purchase agreement dated 04/09/2009 to substantiate his case. The additional evidence field by the assessee was not accepted by the First Appellate Authority for the reason that there was no formal application/prayer for admitting additional evidence u/r. 46A of the Rules.

4.

Both sides heard. The CIT(A) has rejected assessee’s request to consider additional evidence by taking a pedantic view. When technicalities are pitted against substantial justice, the later has to be given precedence. Taking into consideration entirety of fact and documents on record we deem it appropriate to restore this appeal back to the file of CIT(A) for denovo adjudication after admitting additional evidence tendered by the assessee. The CIT(A) shall grant reasonable opportunity of hearing to the assessee before deciding the issue afresh, in accordance with law.

5.

In the result, appeal by assessee is allowed for statistical purpose in the terms aforesaid.

Order pronounced in the open court on Friday the 08th day of April, 2022.

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