I.T.O. 22(2)1, NAVI MUMBAI vs. KOKILABEN N. PATEL, MUMBAI

The present Appeal filed by the revenue is against the order of Ld. CIT (Appeal) – 33, Mumbai dated 21.02.2012 for AY 2007-08 on the grounds mentioned herein below:-

"The appellant prays that the order of the CIT(A) on the above grounds bereversed and that of the Assessing Officer be restored."

"The appellant craves leave to amend or alter any ground or add a newground which may be necessary".

The brief facts of the case are thatthe return of income was filed on 31st of October 2007 declaring total income at Rs. 2, 78, 850 and the assessment was completed U/S 144 of the income tax act determining total income at Rs. 1, 63, 56, 710/- on 21st of December 2009.

Since all the grounds raised by the revenue are inter- related and inter-connected and relates to challenging the order of Ld. CIT(A) in concluding that the appeal was allowed in relation to Ground No 5 of the Grounds of Appeal, though the Ld. CIT(A) has concurred with the findings of the Assessing Officer in respect of the addition of Rs. 59,38,723/- being amount payable to Shri V.H. Patel, thereby rendering the order of the Ld CIT(A) inconsistent and incompatible with its own findings. Therefore, we thought it fit to decide all the above grounds of the present consolidated order.

We have heard the counsel for both the parties and we have also perused the material placed on record as well as orders 5 Kokilaben N. Patel passed by the revenue authorities. From the records, we find that the Ld. CIT(A) has recorded contradictory findings in its order. Basically the additions were made by Assessing Officer on account of businesses receipts, loans, sundry creditors and the Ld. CIT(A) during appellate proceedings had categorically mentioned that there was no resolution the public designation certificate or supporting of documents and the entire case of the assessee is based on decoration which has been submitted by one Mr Miller operative, claimed to be authorized representative of the assessee shimmer the Cadila main pertain and the said statement of Mr Mull Milla Patel has no significance and therefore assessee failed to support the plea that all the unsecured loans and sundry creditors are carried forward from the earlier years. We have considered the facts of the present case and also heard the Ld. AR and after hearing the arguments and of the records we also find that there are contradictory findings recorded by Ld. CIT(A) as on the one hand the Ld. CIT(A) appeal has categorically mentioned that the books of account maintained by the assessee are not reliable and thus agreed with the findings recorded by the assessing officer. Ld. CIT(A) has 6 I.T.A. No. 144/Mum/2012 Kokilaben N. Patel also categorically mentioned that the sundry creditors, the figures as reflected to the opening balance at zero, meaning thereby that all the creditors have never been in existence as that of proprietorship concern for this, the assessee has taken a plea that additions cannot be made in section 68 for bench the Ld. CIT(A) had agreed. The Ld. CIT(A) has on the one side agreed the findings recorded by AO that there was no longer missions from the pertain but on the other hand held that since the amount payable to retired partner and the final benefits therefore the same cannot be taken as unsecured loan of Section 68 of I.T. Act. Please contradictory findings leads us to believe that Ld. CIT(A) has misdirected itself while reaching to the conclusion Therefore under these circumstances We Are of the considered view that the findings recorded by Ld. CIT(A) are bad in law and is stands set aside.Resultantly, these grounds raised by the revenue stands allowed for statistical purposes.