Jai Jinendra, Mehsana V. The Income tax Officer, Mehsana

CO 74/AHD/2007

• Counselvise Citation: [2010] 122 COUNSELVISE.COM (IT) 4418 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 9 month(s) 17 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 03-02-2010
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 02-02-2010
• Assessment Year: 2002-2003
• Appeal Filed On: 16-04-2007
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: S N DIVETIA
• Keywords: Source of fund; Tax effect; Revised return
• Section: 143(3); 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH AHMEDABAD (BEFORE S/SHRI BHAVNESH SAINI, JM AND A. N. PAHUJA, AM) C. O. NO.74/AHD/2007 (IN ITANO.521/AHD/2007 A. Y.: 2002-03) JAI JITENDRA, AZAD CHOWK, MEHSANA PA NO. AAEFJ 1516G VS INCOME TAX OFFICER, 2 ND FLOOR, APPOLLO ENCLAVE, OPP. SIMANDHAR JAIN HIGH WAY MEHSANA (CROSS OBJECTOR) (RESPONDENT) CROSS OBJECTOR BY SHRI S. N. DIVETIA, AR RESPONDENT BY SHRI SANJEEV KASHYAP, DR O R D E R PER BHAVNESH SAINI: THE ABOVE CROSS OBJECTION BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE CIT(A )-XXI, AHMEDABAD DATED 03-11-2006 FOR ASSESSMENT YEAR 2002-03 ON TH E FOLLOWING GROUNDS: 1. THE LD. CIT(A) HAS ERRED IN LAW AND/OR ON FACTS IN CONFIRMING THE ADDITION TO THE EXTENT OF RS.5 LACS 2. THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) OUGHT TO HAVE HELD THAT THE INCOME OFFERED IN THE R EVISED RETURN FILED ON 10.1.2003 RELATED TO THE EXCESS STO CK FOUND DURING THE SURVEY SO THAT ADDITION OF RS.5 LACS AS SEPARATE AND INDEPENDENT INCOME WAS UNCALLED FOR. 3. THE LD. CIT(A) HAS ERRED IN LAW AND/OR ON FACTS IN HOLDING THAT THE IMPUGNED ADDITION MADE BY AO OF RS.7 LACS WAS C.O. NO.74/AHD/2007 (IN ITA NO.521/AHD/2007) JAI JITENDRA 2 SEPARATE AND DISTINCT INCOME FROM THE EXCESS STOCK OFFERED BY THE APPELLANT IN THE REVISED RETURN. 2. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED T HAT THE DEPARTMENTAL APPEAL IN ITANO.521/AHD/2007 HAS BEEN DISMISSED BECAUSE OF LAW TAX EFFECT VIDE ORDER DATED 05-04-20 07. COPY OF THE ORDER IS PLACED ON RECORD. 3. THE LEARNED COUNSEL FOR THE ASSESSEE WHILE REFE RRING TO THE ASSESSMENT ORDER SUBMITTED THAT ORIGINAL RETURN OF INCOME WAS FILED SHOWING TOTAL INCOME OF RS.5,53,806/- AND ASSESSMEN T WAS FINALIZED U/S 143(3) (I) OF THE IT ACT ON 07-01-2003 ON AN INCOME OF RS.15,54,630/-. IN APPEAL BEFORE THE LEARNED CIT(A) VIDE ORDER DATED 2 0-09-2004 THE ADDITION OF RS.9,.52,511/- ON ACCOUNT OF CLOSING ST OCK DIFFERENCE WAS DELETED AND THE APPEAL OF THE ASSESSEE WAS PENDING. THE PRESENT PROCEEDINGS ARE INITIATED U/S 147 OF THE IT ACT AND THE ASSESSEE FILED REVISED RETURN OF INCOME ON 10-01-2003 SHOWING TOTA L INCOME OF RS.10,29,050/-. IN THIS RETURN, ADDITIONAL INCOME O F RS.4,75,958/- WAS DISCLOSED. ACCORDINGLY, RE-ASSESSMENT PROCEEDINGS W ERE INITIATED. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE AO DID NOT ACCEPT THE ADDITIONAL INCOME OF RS.4,75,958/- BECAUSE OF A BSENCE OF SOURCES OF INCOME. THE AO, THEREFORE, ESTIMATED THE ADDITIONAL INCOME AT RS.7,00,000/- AS AGAINST RS.4,75,958/- DECLARED BY THE ASSESSEE ON ACCOUNT OF CLOSING STOCK AND TREATED THE SAME AS UN ACCOUNTED INCOME OF THE ASSESSEE. HE HAS SUBMITTED THAT THE AO AS PER T HE APPEAL EFFECT TO THE ORDER OF THE LEARNED CIT(A) DATED 18-11-2004 TA KEN INCOME AT RS.6,02,120/- AND MADE ADDITION OF RS.7,00,000/- AN D COMPUTED THE INCOME AT RS.13,02,120/-. THE LEARNED COUNSEL FOR T HE ASSESSEE FURTHER SUBMITTED THAT THE LEARNED CIT(A) ULTIMATELY ESTIMA TED ADDITIONAL INCOME AT RS.5,00,000/- AGAINST RS.7,00,000/- ESTIMATED BY THE AO. HE HAS SUBMITTED THAT SINCE NOW IN THE DEPARTMENTAL APPEAL THE ISSUE OF C.O. NO.74/AHD/2007 (IN ITA NO.521/AHD/2007) JAI JITENDRA 3 RS.2,00,000/- WAS INVOLVED, THEREFORE, IT WAS DISMI SSED BEING NOT MAINTAINABLE ON ACCOUNT OF LOW TAX EFFECT. THE LEAR NED COUNSEL FOR THE ASSESSEE IN VIEW OF THE ABOVE FACTS SUBMITTED THAT SINCE THE ASSESSEE HAS ALREADY DECLARED RS.4,75,958/- IN THE REVISED RETUR N OF INCOME ON 10-01- 2003 AND THE LEARNED CIT(A) ULTIMATELY CONFIRMED TH E ADDITION OF RS.5,00,000/-, THEREFORE, THE ASSESSEE IS NOT AGGRI EVED AGAINST THE ABOVE FINDINGS GIVEN BY THE LEARNED CIT(A). HE HAS HOWEVE R, SUBMITTED THAT DIRECTION MAY BE ISSUED TO THE AO TO TAKE INTO CONS IDERATION THE AMOUNT ALREADY DECLARED IN THE RETURN OF INCOME AT RS.4,75 ,958/- AND THE TAXES ALREADY PAID THEREON MAY BE ADJUSTED AGAINST THE TA X CALCULATED BY THE AO. THE LEARNED DR HAS NOT OBJECTED TO THE SAME. 4. ON CONSIDERATION OF THE ABOVE, WE ARE OF THE VIE W THAT THE CROSS OBJECTION OF THE ASSESSEE HAS NO MERIT BECAUSE THE ASSESSEE IS NOT AGGRIEVED AGAINST THE ADDITION OF RS.5,00,000/- RES TRICTED BY THE LEANED CIT(A) AGAINST THE ADDITION OF RS.7,00,000/- MADE B Y THE AO. THE ASSESSEE HAS ALREADY SURRENDERED ADDITIONAL INCOME OF RS.4,75,958/- IN THE REVISED RETURN OF INCOME AND ULTIMATELY THE LEA RNED CIT(A) HAS SUSTAINED THE ADDITION OF RS.5,00,000/- ON THIS HEA D. THEREFORE, ADDITION OF RS.5,00,000/- MADE BY THE LEARNED CIT(A) IS CONF IRMED. HOWEVER, THE AO IS DIRECTED TO TAKEN INTO CONSIDERATION THE ADDI TIONAL INCOME DECLARED BY THE ASSESSEE FOR A SUM OF RS.4,75,958/- IN THE R EVISED RETURN OF INCOME AND THE TAXES PAID THEREON FOR THE PURPOSE O F GIVING APPEAL EFFECT TO THE ORDER OF THE LEARNED CIT(A). 5. WITH THE ABOVE OBSERVATION, THE CROSS OBJECTION OF THE ASSESSEE IS DISMISSED. C.O. NO.74/AHD/2007 (IN ITA NO.521/AHD/2007) JAI JITENDRA 4 6. AS A RESULT, THE CROSS OBJECTION OF THE ASSESSEE STANDS DISMISSED. ORDER PRONOUNCED ON 03-02-2010 SD/- SD/- (A. N. PAHUJA) ACOUNTANT MEMBER (BHAVNESH SAINI) JUDICIAL MEMBER DATE : 03-02-2010 LAKSHMIKANT/- COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) CONCERNED 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE BY ORDER D Y. REGISTRAR, ITAT, AHMEDABAD