SHRI PARESH H GUDHAKA,MUMBAI vs. ITO WARD 1(3), KALYAN

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ITA 4269/MUM/2018Status: DisposedITAT Mumbai12 June 2019AY 2013-143 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the Assessing Officer had not examined whether the assessee had actually booked any such loss in their books. Therefore, the matter was remitted back to the Assessing Officer for fresh examination.

What were the facts?

The Assessing Officer made an addition of Rs. 26,65,396/- to the assessee's income, treating it as undisclosed income based on information about accommodation entries for commodity losses. The broker denied any transactions with the assessee.

What were the issues?

Whether the addition made by the Assessing Officer was justified without examining the assessee's books of account for actual booking of losses, and if a prior concession by counsel bars raising factual aspects.

Which sections of the Income-tax Act were involved?

Section 133(6)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” Bench, Mumbai

Before: Shri Shamim Yahya (AM)

For Appellant: Shri Virag H. Shah
For Respondent: Shri Chaitanya Anjaria
Hearing: 11.6.2019Pronounced: 12.6.2019

This appeal by the assessee is directed against the order of learned CIT(A) dated 6.3.2018 and pertains to A.Y. 2013-14. The issue raised is that learned CIT(A) erred in confirming the Assessing Officer’s order making addition of Rs. 26,65,396/-.

2.

Brief facts of the case are that the Assessing Officer in the assessment proceedings noted that information has been received that the assessee is a beneficiary of accommodation entry for loss in commodities through broker M/s. HRIM Comtrade. The Assessing Officer issued notice u/s. 133(6) to M/s. HRIM Comtrade. M/s. HRIM Comtrade informed the Assessing Officer that the assessee is not a client and no transaction has been entered. However, the Assessing Officer treated Rs. 26,65,396/- as undisclosed income of the assessee.

3.

Before learned CIT(A), the assessee, inter alia, submitted that the assessee has not done any transaction through M/s. HRIM Comtrade and that it has not taken any such entry. However, earlier learned counsel of the assessee has agreed to the addition. Taking this into account, learned CIT(A)

2 Shri Paresh H. Gudhaka conformed the addition. Against the above order the assessee is in appeal before the ITAT.

4.

We have heard both the counsel and perused the record. Learned counsel submitted that the assessee has not done any transaction through the said broker. He submitted that in the accounts of the assessee there is no such bogus loss accounted for. Hence, he submitted that without examining the facts, this addition has been made. Hence, learned counsel submitted that mere concession of earlier counsel of the assessee, cannot be taken as bar on the assessee to raise factual aspect which has never been examined by the Assessing Officer.

5.

Upon careful consideration, I am of the opinion that it is the assessee’s claim that assessee has not taken any such bogus accommodation entries for loss. The Assessing Officer has only referred to the receipt of information and has not given any findings as to whether actually there is any such loss booked by the assessee or not. In these circumstances, in my considered opinion interest of justice will be served if the issue is remitted to the file of the Assessing Officer. The Assessing Officer shall examine as to whether there is any such entry of bogus loss in the books of account of the assessee and thereafter he shall decide the issue as per law after giving proper opportunity of being heard. Both the counsel fairly agreed to the above proposition.

6.

In the result, assessee’s appeal is allowed for statistical purposes.

Order has been pronounced in the Court on 12.6.2019.

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