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IN THE INCOME TAX APPELLATE TRIBUNAL "F" BENCH, MUMBAI
BEFORE HON'BLE S/SHRI D. MANMOHAN , VICE-PRESIDENT
AND B.R.BASKARAN (AM)
, . , .. ,
./I.T.A. No.3674/Mum/2013
( / Assessment Year : 2009-10)
Income Tax Officer-20(3)(4), / Vivek V Sharma,
5th floor, Piramal Chambers, Vs. C-18, Uttarayan CHS,
Lalbaug, Mahakali Caves Road,
Mumbai-400012 Andheri(E),
Mumbai.
( /Appellant) .. ( / Respondent)
. / . /PAN/GIR No. : BEUPS9312C
/ Appellant by : Shri Sunil Kumar Singh
/Respondent by : None
/ Date of Hearing
: 18.8.2014
/Date of Pronouncement : 28.8.2014
/ O R D E R
Per B.R.BASKARAN, Accountant Member:
The appeal filed by the revenue is directed against the order dated 05-02-
2013 passed by Ld CIT(A)-13, Mumbai and it relates to the assessment year
2009-10. The revenue is aggrieved by the decision of Ld CIT(A) in deleting the
addition of Rs.27,68,900/- made by the AO u/s 68 of the Act. None appeared on
behalf of the assessee and hence we proceed to dispose of this appeal ex-parte,
without the presence of the assessee.
2. The facts relating thereto are state in brief. During the course of
assessment proceeding, the AO noticed that the assessee has deposited cash
aggregating to Rs.29,18,900/- in his bank account maintained with Punjab
2 ITA 3674/Mum/2013
Maharashtra Co-op Bank Ltd. Since no explanation was forthcoming from the
assessee, the AO assessed the same as the income of the assessee u/s 68 of the
Act. It is to be mentioned here that the AO has completed the assessment to
the best of his judgment u/s 144 of the Act, since the assessee did not appear
before him at all during the course of assessment proceeding. However, the AO
has wrongly mentioned in the assessment order that the assessment has been
completed u/s 143(3) of the Act.
3. Before Ld CIT(A), the assessee submitted all the details pertaining to the
bank deposits. Hence, the Ld CIT(A) called for a remand report from the
assessing officer. In the remand report, the AO reported that the cash deposits
made into the bank account are duly reflected in the cash book / books of
account and are supported by the documentary evidences except for a sum of
Rs.1,50,000/-. For the sake of convenience, we extract below the observations
made in the remand report, which are extracted by Ld CIT(A) in para 5.2 of his
order:-
"5.2 In response to the same, the Assessing Officer has
submitted his remand report vide letter dated 18-01-2013 and the
contents thereof are reproduced below:
"2. In this case, assessment was completed u/s 144 as no details
were furnished. In the assessment order, addition was made for
cash deposits in Punjab Maharashtra Co-op Bank, Andheri(E),
Mumbai, by the assessee treated as unexplained cash credit u/s 68
of the Income Tax Act, 1961 of Rs.29,18,900/-. The addition was
made as the AIR information of cash deposits was not explained. In
appellate proceedings, the assessee claimed that the cash deposits
in bank account are explained and submitted that the addition is
not called for.
3. In appellate proceedings, a paper book containing various
documents in support of the above claimed was filed as additional
evidences under Rule 46A by the assessee. Copy of the same was
sent to this office for verification. In order to verify these
3 ITA 3674/Mum/2013
documentary evidences filed by the assessee, the books of
accounts and other supporting documents were called for.
4. In response to the above, Shri Ashok Ladha, FCA from M/s
Laddha & Laddha, Chartered Accountants and representative of the
assessee company attended and explained the case. It is seen that
cash deposits in bank account are duly reflected in the cash book /
books of account and are supported by the documentary evidence
except Rs.1,50,000/. The assessee has claimed that he deposited
cash in bank account on 5.6.2008 out of the sum belonging to his
grand father amounting to Rs. 1,50,000/- which was temporarily
lying with him. On being asked, the assessee furnished the
confirmatory letter for the same. It is seen that the grandfather of
the assessee is not assessed to tax and he retired from service long
back and is a senior citizen aged more than 75 years old. The claim
of the assessee is not substantiated for Rs.1,50,000/- and therefore
the addition for this amount needs to be upheld".
The Ld CIT(A) supplied a copy of the remand report to the assessee and sought
for his explanations/ objections. After considering the explanations / objections
of the assessee, the Ld CIT(A) sustained the addition to the extent of
Rs.1,50,000/- and deleted the balance amount of addition. Aggrieved by the
order passed by Ld CIT(A), the revenue has filed this appeal before us.
4. We have heard Ld D.R and perused the record. We have already noticed
that the Ld CIT(A) has followed the view expressed by the assessing officer in
the remand report given to him and accordingly confirmed the addition to the
extent of Rs.1,50,000/- and deleted the balance amount of addition. The AO has
made the addition of Rs.27,68,900/- only for want of evidences / sources for
making the deposits. In fact, the assessment was completed to the best of
judgement of the assessing officer u/s 144 of the Act. However, in the appellate
proceedings before ld CIT(A), the assessee has explained the sources of the
deposits and the assessing officer has also examined the said explanations and
accordingly gave the remand report by expressly stating that the above said
4 ITA 3674/Mum/2013
amounts, except for a sum of Rs.1,50,000/-, are duly reflected in the cash book /
books of account. Under these set of facts, we are unable to understand as to
how the revenue is aggrieved by the decision rendered by Ld CIT(A), when he
has simply followed the view expressed by the assessing officer in the remand
report. Hence, we do not find any merit in the grounds urged by the revenue.
5. We have already noticed that the assessment was completed u/s 144 of the
Act, but it was wrongly mentioned as se. 143(3) in the assessment order. We
notice that the Registry has sent a defect memo to the revenue pointing out this
defect, but till date the revenue has taken no step to rectify the same. Hence,
on this count also, this appeal deserves to be dismissed.
6. The foregoing discussions would show that the impugned appeal falls in the
category of "frivolous appeal". We have been reading in the news papers that
the Government of India is discouraging filing of such frivolous appeals, since it
is causing unwarranted harassment to the assessees and also over burdens the
judiciary, which is already hard pressed for time and resources for disposing of
long pending appeals. Before us, the Ld D.R submitted the Government of India
has already formed a committed to identify the ways and means to reduce /
weed out such kind of frivolous appeals and accordingly submitted that such kind
of frivolous appeals shall be avoided in future.
7. Various benches of this Tribunal is noticing that the revenue has been
filing such kind of frivolous appeals before the Tribunal in a routine manner
without properly appreciating the facts available in each cases. A Co-ordinate
bench of Tribunal consisted of Hon'ble Vice President as one of the parties, has
already expressed its displeasure over the conduct of the revenue by making
5 ITA 3674/Mum/2013
following observations in its order dated 13.06.2014 passed in the case of ITO
Vs. M/s Growel Energy Co. Ltd in ITA No.338/Mum/2011(AY-2007-08) (para 2
and 28 (pgs.1 and 14 of the order):
"2. At the outset it may be mentioned that the Income Tax Officer, who is
the appellant herein, as well as the Commissioner of Income Tax, who has
authorised the AO to prefer an appeal, did not apply their mind in the
correct perspective and in a very lacklustre and routine manner filed the
appeal which, in turn, resulted in wastage of time of the court which would
be highlighted at appropriate places.
28. As we have already mentioned, on account of improper action on
the part of the Commissioner of Income Tax as well as the AO, the
assessee had to engage a counsel and incur substantial expenditure to
defend its case. Therefore we award a token cost of `5,000/- upon the
Commissioner of Income tax who has given the authorisation and cost of
Rs.10,000/- upon the AO who has filed this appeal."
8. It is unfortunate that the assessing officer, after expressing satisfaction
over the explanations / information furnished by the assessee during the remand
proceedings with regard to the sources of the impugned deposits, has chosen to
file the present appeal. The authorisation given by the Ld Commissioner of
Income tax, a top level officer of the department, only shows that he has not
applied his mind at all in the impugned matter. From the facts prevailing in the
instant case, it can be seen that the issue contested before us does not involve
any substantial question of law, which may some times compel the revenue to
file appeals in order to keep the issue alive. It is high time that the revenue
should take this matter seriously and may consider withdrawing frivolous appeals
filed by them, which will benefit all the concerned. Further it would also save the
time and resources of revenue, which can be utilized in a meaningful and
profitable manner.
6 ITA 3674/Mum/2013
9. Hence, it is regrettable that both the officers have lost sight of the fact that
their action would put the assessee in a uncomfortable situation and would also
compel him to spend money and time in defending the appeal. Therefore, in
order to discourage the revenue from filing the frivolous appeals, that too
without proper application of mind, we award a token cost of Rs.1,000/- (One
thousand) upon the revenue.
10. The said payment should be made to the assessee within one month from
the date of receipt of this order.
11. Accordingly, the appeal filed by the revenue is dismissed with costs.
The above order was pronounced in the open court on 28th Aug, 2014.
28 th Aug, 2014
Sd sd
(. /D. MANMOHAN) (.. ,/ B.R. BASKARAN)
/VICE- PRESIDENT /ACCOUNTANT MEMBER
Mumbai: 28th Aug,2014.
. ../ SRL , Sr. PS
/Copy of the Order forwarded to :
1. / The Appellant
2. / The Respondent.
3. () / The CIT(A)- concerned
4. / CIT concerned
5. , , /
DR, ITAT, Mumbai concerned
6. / Guard file.
/ BY ORDER,
True copy
(Asstt. Registrar)
, /ITAT, Mumbai
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