M/s Ashim Kumar Chatterjee, Kolkata V. ITO, WD-WD-54(4), KOLKATA, Kolkata

ITA 1023/KOL/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 9302 (ITAT-KOLKATA)
• Duration Of Justice: 9 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-03-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 12-01-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 12-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P K AGARWAL FCA SHRI TA
• Keywords: Unexplained investment; Additional evidence; Non-deduction of tax
• Section: 143(3); 194C; 69; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH D KOLKATA BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI S.S.VISWANETHRA RAVI, JUDICIAL MEMBER ITA NO.1023/KOL/2016 ASSESSMENT YEAR:2010-11 M/S ASHIM KUMAR CHATTERJEE, 169B, RAJA DINENDRA STREET, MANICKTALA, KOLKATA-04 [ PAN NO.ABYPC 5107 D ] / V/S . INCOME TAX OFFICR,WARD-54(4), 3 NO. GOVT PLACE WEST, 1 ST FLOOR, KOLKATA-69 /APPELLANT .. /RESPONDENT /BY APPELLANT SHRI P.K. AGARWAL, FCA /BY RESPONDENT SHRI TANUJ NEOGI, JCIT-DR /DATE OF HEARING 12-01-2017 /DATE OF PRONOUNCEMENT 03-03-2017 /O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER:- THIS APPEAL BY THE ASSESSEE IS AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-6, KOLKATA DATED 22.02.2016. ASSESSME NT WAS FRAMED BY ITO WARD- 54(4), KOLKATA U/S 143(3) OF THE INCOME TAX ACT, 19 61 (HEREINAFTER REFERRED TO AS THE ACT) VIDE HIS ORDER DATED 25.03.2013 FOR ASSESSMEN T YEAR 2010-11. SHRI P.K. AGARWAL, LD. AUTHORIZED REPRESENTATIVE AP PEARED ON BEHALF OF ASSESSEE AND SHRI TANUJ NEOGI, LD. DEPARTMENTAL REPRESENTATIVE R EPRESENTED ON BEHALF OF REVENUE. 2. BRIEFLY, THE FACTS ARE THAT THE ASSESSEE, AN IND IVIDUAL ENGAGED PROFESSION OF ADVOCACY. THE ASSESSEE FOR THE YEAR UNDER CONSIDERA TION FILED ITS RETURN OF INCOME DECLARING TOTAL INCOME OF 12,34,963/- COMPRISING INCOME FROM PROFESSION AND O THER SOURCE. SUBSEQUENTLY, THE CASE WAS SELECTED FOR SCR UTINY AND NOTICE U/S. 143(2)/142(1) ITA NO.1023/KOL/2016 A.Y. 2010-11 M/S ASHIM KR. CHATTERJEE VS. ITO WD-54(4) K OL. PAGE 2 OF THE ACT WAS ISSUED UPON ASSESSEE. ASSESSMENT WAS FRAMED U/S. 143(3) OF THE ACT AT A TOTAL INCOME OF 26,31,610/- AFTER MAKING CERTAIN ADDITIONS / DISALL OWANCES TO THE TOTAL INCOME OF THE ASSESSEE. 3. FIRST ISSUE RAISED BY ASSESSEE IN GROUND NO.1 T O 4 ARE THAT LD. CIT(A) ERRED IN CONFIRMING THE ORDER OF ASSESSING OFFICER BY SUSTAI NING THE ADDITION OF 4,27,330/- ON ACCOUNT OF NON-DEDUCTION OF TDS. 4. THE ASSESSEE IN THE YEAR UNDER CONSIDERATION HAS MADE THE PAYMENTS TO COUNSELS AND ADVOCATES AS DETAILED BELOW:- SL.NO NAME AMOUNT (RS) 1 A. CHATTERJEE 1,30,000 2 P.K.DAS 34,000 3 RAJA BASU CHOUDHURY 2,29,330 4 PRATAP CHATTRJEE 34,000 THE AO OBSERVED THAT IN EACH CASE PAYMENT IS EXCEED ING THE LIMIT OF RS.20,000/- AND ASSESSEE WAS UNDER OBLIGATION TO DEDUCT THE TDS ON AFORESAID PAYMENTS UNDER SECTION 194J OF THE ACT. IT WAS ALSO OBSERVED THAT THE ACC OUNTS OF THE ASSESSEE WERE ALSO SUBJECT TO AUDIT U/S 44AB OF THE ACT IN THE IMMEDIA TE PRECEDING ASSESSMENT YEAR. ON QUESTION BY AO FOR THE NON-DEDUCTION OF TAX, THE AS SESSEE SUBMITTED THAT THE ACCOUNTANT HAS MADE A MISTAKE FOR NON-DEDUCTION OF TDS INADVERTENTLY AND EXPRESSED NO OBJECTION FOR THE PROPOSED ADDITION AS PER LAW. ACCORDINGLY, AO HAS DISALLOWED THE SAME AND ADDED TO THE TOTAL INCOME OF ASSESSEE. 5. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE L D. CIT(A). THE ASSESSEE BEFORE THE LD. CIT-A SUBMITTED THAT FEES TO THE COU NSEL AND ADVOCATES WERE REIMBURSED BY THE CLIENT OF ASSESSEE. THE ACCOUNTING ENTRIES S HOWN IN THE FORM OF EXPENSE CANNOT CHANGE THE CHARACTER OF THE PAYMENTS MADE BY ASSESS EE. AS SUCH, THE ACCOUNTING ENTRIES ARE NOT DECISIVE IN TAXATION ISSUES. HOWEVE R, LD. CIT(A) DISREGARDED THE CLAIM OF ASSESSEE AND CONFIRMED THE ORDER OF AO BY OBSERV ING AS UNDER:- 3.3 I HAVE CONSIDERED THE FACTS OF THE CASE AND THE APPELLANTS SUBMISSIONS. IT IS NOT DISPUTED THAT TAX HAD NOT BEEN DEDUCTED BY THE APPE LLANT. THE APPELLANT ALSO RELIED UPON OTHER CASE TO STATE THAT REIMBURSEMENT OF EXPE NSES DOES NOT ATTRACT THE ITA NO.1023/KOL/2016 A.Y. 2010-11 M/S ASHIM KR. CHATTERJEE VS. ITO WD-54(4) K OL. PAGE 3 PROVISIONS REQUIRING DEDUCTION OF TAX AT SOURCE BUT THE FACTS OF THOSE CASES ARE DISTINGUISHABLE. IN THOSE CASES, THE ASSESSEE HAD R EIMBURSED EXPENSES TO THE PAYEE WHEREAS IN THE INSTANT CASE, IT IS THE APPELLANTS CLAIM THAT EXPENSES INCURRED BY HIM IN THE FORM OF PAYMENTS TO OTHER ADVOCATES AND COUN SELS ON BEHALF OF HIS CLIENTS WERE REIMBURSED BY THE CLIENT. AS REGARDS, THE RELIANCE ON THE DECISION IN OF HON'BLE ITAT, KOLKATA IN THE CASE OF SHARMA KAJORIA & CO. VS DCIT (SUPRA), THE BILLS HAVE BEEN PRODUCED BY THE APPELLANT FOR THE FIRST TIME DURING THE APPELLATE PROCEEDINGS AND ARE CONTRARY TO SUBMISSIONS MADE DURING THE ASSESSMENT PROCEEDINGS. FURTHER, IN THAT CASE, THE APPELLANT HAD NOT DEBITED THE RELEVANT EX PENSES TO THE PROFIT AND LOSS AMOUNT BUT IN THE PRESENT CASE THE ADVOCATE PAYMENTS AND C OUNSEL PAYMENTS HAVE BEEN DEBITED TO THE PROFIT AND LOSS ACCOUNT BY THE APPEL LANT. HENCE, I HOLD THAT THE APPELLANT SHOULD HAVE DEDUCTED TAX AT SOURCE ON THE IMPUGNED COUNSEL PAYMENT AND ADVOCATE PAYMENTS. THEREFORE, THE DISALLOWANCE OF A DVOCATE PAYMENTS OF RS.2,97,330/- AND COUNSEL PAYMENTS OF RS.1,30,000/- U/S 40(A)(IA) OF THE ACT IS CONFIRMED. AGGRIEVED BY THIS, ASSESSEE HAS COME UP IN APPEAL B EFORE US ON THE FOLLOWING GROUNDS:- (1) FOR THAT LD. ASSESSING OFFICER AS WELL AS LD. C IT(APPEALS) BOTH HAD ERRED IN LAW AND IN FACT IN MAKING ADDITION OF RS.1,30,000/- AS COUNSELS PAYMENT AND RS.2,97,330/- AS ADVOCATES PAYMENTS U/S. 40(A)(IA) OF THE INCOME TAX ACT, 1961, (IN SHORT ACT) UNDER THE FACTS AND CIRCUMSTANCES. (2) FOR THAT THE PAYMENTS MADE BY THE APPELLANT ASS ESSEE ENGAGED IN LEGAL PROFESSION AS SOLICITOR AND ADVOCATES WERE REIMBURSEMENTS BY A PPELLANT ASSESSEES CLIENTS AND DISALLOWANCE U/S. 40(A)(IA) OF THE ACT IN RESPECT O F REIMBURSEMENT EXPENSES WERE DEVOID OF ANY SUBSTANTIAL BASIS. (3) FOR THAT THE ACCOUNTING ENTRIES MADE IN THE BOO KS OF ACCOUNT ARE NOT DECISIVE OF NATURE OF PAYMENT WHICH IS A SETTLED PRINCIPLE OF L AW AND THE SAME HAS BEEN IGNORED BY LD. CIT(APPEALS). (4). FOR THAT THE DISALLOWANCES U/S 40(A)(IA) WERE DELETED BY HON'BLE ITAT KOLKATA BENCH IN THE CASE OF SHARMA KAJARIA & CO. VS. DEPU TY COMMISSIONER OF INCOME TAX, CIRCLE-54-LOL. (2012)50 SOT 282 (KOL) AND LD. CIT(A PPEALS)HAD ERRED IN NOT FOLLOWING THE SAME ALTHOUGH THE SAID CASE WAS BROUG HT TO HIS NOTICE IN APPEAL PROCEEDINGS. 6. BEFORE US LD. AR FOR THE ASSESSEE FILED PAPER BO OK WHICH IS RUNNING PAGES FROM 1 TO 40 AND REITERATED SAME SUBMISSIONS AS MAD E BEFORE LD. CIT(A). HE ALSO DREW OUR ATTENTION ON PAGES 5 TO 9 WHERE THE COPIES OF SAMPLE BILLS WERE PLACED. IN THOSE SAMPLE BILLS, THE PAYMENTS COLLECTED ON BEHAL F OF COUNSEL AND ADVOCATES WERE SHOWN SEPARATELY. ON THE OTHER HAND, LD. DR SUBMITTED THAT ADDITIONAL EVIDENCES ARE SUBMITTED AND ACCORDINGLY PRAYED BEFORE THE BENCH TO RESTORE THE ISSUE TO THE FILE OF AO. ITA NO.1023/KOL/2016 A.Y. 2010-11 M/S ASHIM KR. CHATTERJEE VS. ITO WD-54(4) K OL. PAGE 4 7. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE ISSUE IN THE CASE RELATES TO THE DISALL OWANCES MADE BY THE AO ON ACCOUNT OF NON-DEDUCTION OF TAX ON THE PAYMENT OF PROFESSIO NAL FEES AS SPECIFIED UNDER SECTION 194J OF THE ACT. THE DISALLOWANCE MADE BY THE AO HA S BEEN SUBSEQUENTLY CONFIRMED BY THE LEARNED CIT-A. THE PROVISIONS OF SECTION 40(A)(IA) OF THE ACT, UND ER WHICH THE IMPUGNED DISALLOWANCES HAS BEEN MADE, PROVIDES AS UNDER. AMOUNTS NOT DEDUCTIBLE. 40. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN SECTIO NS 30 TO 88 [38], THE FOLLOWING AMOUNTS SHALL NOT BE DEDUCTED IN COMPUTING THE INCO ME CHARGEABLE UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION, (A) .. (IA) ANY INTEREST, COMMISSION OR BROKERAGE, 91 [RENT, ROYALTY,] FEES FOR PROFESSIONAL SERVICES OR FEES FOR TECHNICAL SERVICES PAYABLE TO A RESIDENT, OR AMOUNTS PAYABLE TO A CONTRACTOR OR SUB-CONTRACTOR, BEING RESIDENT, FOR CARRYING OUT ANY WORK (INCLUDING SUPPLY OF LABOUR FOR CARRYING OUT ANY WO RK), ON WHICH TAX IS DEDUCTIBLE AT SOURCE UNDER CHAPTER XVII-B AND SUCH TAX HAS NOT BEEN DEDUCTED OR, AFTER DEDUCTION, 92 [ HAS NOT BEEN PAID ON OR BEFORE THE DUE DATE SPECIFI ED IN SUB-SECTION (1) OF SECTION 139 : ] 93 [PROVIDED THAT WHERE IN RESPECT OF ANY SUCH SUM, TAX HAS BEEN DEDUCTED IN ANY SUBSEQUENT YEAR, OR HAS BEEN DEDUCTED DURING TH E PREVIOUS YEAR BUT PAID AFTER THE DUE DATE SPECIFIED IN SUB-SECTION (1) OF SECTION 139 , SUCH SUM SHALL BE ALLOWED AS A DEDUCTION IN COMPUTING THE INCOME OF T HE PREVIOUS YEAR IN WHICH SUCH TAX HAS BEEN PAID. ] EXPLANATION.FOR THE PURPOSES OF THIS SUB-CLAUSE, (I) COMMISSION OR BROKERAGE SHALL HAVE TH E SAME MEANING AS IN CLAUSE (I) OF THE EXPLANATION TO SECTION 194H ; (II) FEES FOR TECHNICAL SERVICES SHALL HAVE THE SAME MEANING AS IN EXPLANATION 2 TO CLAUSE (VII) OF SUB-SECTION (1) OF SECTION 9 ; (III) PROFESSIONAL SERVICES SHALL HAVE THE S AME MEANING AS IN CLAUSE (A) OF THE EXPLANATION TO SECTION 194J ; (IV) WORK SHALL HAVE THE SAME MEANING AS IN EXPLANATION III TO SECTION 194C ; 94 [(V) RENT SHALL HAVE THE SAME MEANING AS IN CLAU SE (I) TO THE EXPLANATION TO SECTION 194-I ; (VI) ROYALTY SHALL HAVE THE SAME MEANING AS IN EXPLANATION 2 TO CLAUSE (VI) OF SUB-SECTION (1) OF SECTION 9;] A PLAIN READING OF THE ABOVE STATUTORY PROVISION MA KES IT CLEAR THAT THIS PROVISION SEEKS TO RESTRICT THE DEDUCTIONS WHICH ARE OTHERWIS E PERMISSIBLE UNDER SECTION 30 TO 38 OF THE ACT. IN OTHER WORDS A DISALLOWANCE CAN BE MA DE ONLY IN RESPECT OF AN AMOUNT WHICH IS SOUGHT TO BE DEDUCTED BY VIRTUE OF THE PRO VISIONS OF THESE SECTIONS. ITA NO.1023/KOL/2016 A.Y. 2010-11 M/S ASHIM KR. CHATTERJEE VS. ITO WD-54(4) K OL. PAGE 5 IN THE INSTANT CASE BEFORE US THE CONTENTION OF THE ASSESSEE IS THAT THE PAYMENT MADE TO THE LAWYERS IS NOTHING BUT THE REIMBURSEMENT OF EXP ENSES THEREFORE THERE CANNOT BE ANY OCCASION TO INVOKE THE PROVISIONS OF SECTION 40 (A)(IA) OF THE ACT. HOWEVER THE LEARNED CIT-A OBSERVED THAT THE PAYMENT TO THE COUN SELS HAS BEEN DEBITED IN THE PROFIT AND LOSS ACCOUNT. THE ARGUMENT OF THE LEARNE D AR IS THAT THE TREATMENT GIVEN TO A TRANSACTION IN THE BOOKS OF ACCOUNTS OR PROFIT AN D LOSS ACCOUNT IS NOT DECISIVE OF THE TRUE NATURE OF THE TRANSACTION. ON PERUSAL OF THE PAGES 1 TO 4 OF PAPER BOOK WHERE THE BILLS RAISED TO THE PARTIES ARE PLACED, WE FIND THAT THE ASSESSEE HAS CLAIMED THE P AYMENT FOR SENIOR COUNSEL FROM ITS CLIENT SEPARATELY. THE SAMPLE BILLS PRODUCED BEFORE US FOR OUR CONSIDERATION JUSTIFY THAT THE ASSESSEE IS CHARGING THE FEES FROM ITS CLI ENTS FOR THE COUNSELS SEPARATELY. THUS THE AMOUNT OF FEES COLLECTED FROM THE CLIENTS IN TH E NAME OF THE SENIOR COUNSEL AMOUNTS TO REIMBURSEMENT OF EXPENSES. ACCORDINGLY T HE CLAIM OF THE ASSESSEE IS THAT HE HAD NO SHARE OF INCOME OUT OF THESE COUNSEL PAYM ENTS AND ACCORDINGLY NOT LIABLE FOR THE TDS DEDUCTION. WE FIND FORCE IN THE ARGUMEN T OF THE LD AR BUT AT THE SAME TIME THE GAMUT OF THE FACTS OF THE CASE NEEDS VERIF ICATION. ON THIS PROPOSITION THE LEARNED DR FAIRLY DID NOT DISPUTE THE SAME BUT PRAY ED TO RESTORE THE MATTER TO THE FILE OF THE ASSESSING OFFICER FOR THE NECESSARY VERIFICA TION ON THIS ASPECT. IN VIEW OF THESE DISCUSSIONS AND BEARING IN MIND ENTIRETY OF THE CAS E WE DEEM IT FIT AND PROPER TO RESTORE THE MATTER TO THE FILE OF THE ASSESSING OFF ICER FOR ADJUDICATION DE NOVO IN THE LIGHT OF OUR ABOVE OBSERVATION AND IN ACCORDANCE WI TH THE LAW. WHILE DOING SO THE ASSESSING OFFICER SHALL GIVE A DUE AND FAIR OPPORTU NITY OF HEARING TO THE ASSESSEE AND SHALL DECIDE THE MATTER BY WAY OF SPEAKING ORDER IN ACCORDANCE WITH THE LAW. HENCE THIS GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED FO R THE STATISTICAL PURPOSES. 8. NEXT ISSUE RAISED BY ASSESSEE IN GROUND NO. 5 & 6 ARE THAT LD. CIT(A) ERRED IN CONFIRMING THE ORDER OF AO BY SUSTAINING THE DISAL LOWANCE OF R.9.50 LAKH AS UNEXPLAINED INVESTMENT U/S 69 OF THE ACT. 9. THE ASSESSEE IN THE YEAR UNDER CONSIDERATION HAS MADE PAYMENT TO GITA GANESH PROMOTERS LTD. (GGPL FOR SHORT) FOR THE PURCHASE OF FLATS AND PAYMENT WAS MADE THROUGH BANKING CHANNEL AS DETAILED AS UNDER:- ITA NO.1023/KOL/2016 A.Y. 2010-11 M/S ASHIM KR. CHATTERJEE VS. ITO WD-54(4) K OL. PAGE 6 SL. NO. DATE OF PAYMENT AMOUNT (RS) 1. 26.03.2010 9.86 LAKH 2. 31.12.2009 9.50 LAKH HOWEVER, DURING THE COURSE OF ASSESSMENT PROCEEDING S, AO OBSERVED THAT PAYMENT OF 9.86 LAKH HAS BEEN SHOWN IN THE BALANCE SHEET OF AS SESSEE. THEREFORE, AO TREATED THE PAYMENT OF 9.50 LAKH AS UNDISCLOSED INVESTMENT AND ADDED TO TH E TOTAL INCOME OF ASSESSEE. 10. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE LD. CIT(A). THE ASSESSEE BEFORE LD. CIT(A) SUBMITTED THAT PROVISION OF SEC. 69 OF THE ACT ATTRACTS ON UNEXPLAINED INVESTMENT BUT IN THE INSTANT CASE, THE PAYMENT WAS MADE THROUGH BANK ACCOUNT. THEREFORE, THE ACTION OF AO TREATING THE P AYMENT OF 9.50 LAKH AS UNDISCLOSED INVESTMENT IS WITHOUT ANY BASE, HOWEVER , LD. CIT(A) CONFIRMED THE ACTION OF AO BY OBSERVING AS UNDER:- 4.3 I HAVE CONSIDERED THE FACTS OF THE CASE AND THE APPELLANTS SUBMISSIONS. THE APPELLANTS EXPLANATION REGARDING THE PAYMENT OF RS .9,50,00/- MADE BY HIM TO M/S GEETA GANESH PROMOTERS LTD. ON 31.12.2009 IS THAT A LTHOUGH IT WAS NOT REFLECTED IN THE BOOKS OF ACCOUNT, THE PAYMENT HAD BEEN MADE OUT OF A DISCLOSED BANK ACCOUNT. HOWEVER, THE APPELLANT HAS NOT EXPLAINED AS TO HOW THE BOOKS OF ACCOUNT BALANCED UNDER THE DOUBLE-ENTRY METHOD OF BOOK-KEEPING IN TH E ABSENCE OF ENTRY REGARDING THE PAYMENT OF RS.9,50,000/-. THIS SHOWS THAT BOOKS ARE UNRELIABLE AND THE DISCREPANCY OF RS.9,50,000/- WHICH WOULD ARISE IF THE PAYMENT OF R S.9,50,000/- IS TAKEN INTO ACCOUNT IN THE BOOKS OF ACCOUNT REMAINS UNEXPLAINED . IN TH E LIGHT OF THE GAPS IN THE EXPLANATION OF THE A./R, THE ADDITION OF RS.9,50,00 0/- IS CONFIRMED. BEING AGGRIEVED BY THIS ORDER OF LD. CIT(A) ASSESSE E CAME IN SECOND APPEAL BEFORE US. 11. BEFORE US LD. AR FOR THE ASSESSEE HAS REITERATE D SAME SUBMISSIONS AS MADE BEFORE LD. CIT(A) WHEREAS LD. DR FOR THE REVENUE VE HEMENTLY RELIED ON THE ORDER OF AUTHORITIES BELOW. 12. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE ISSUE IN THE CASE RELATES TO THE DISALL OWANCES MADE BY THE AO ON ACCOUNT OF PAYMENT TO GGPL FOR RS. 9.50 LAKH WHICH HAS NOT BEEN DISCLOSED IN THE BALANCE SHEET OF THE ASSESSEE. THE AO HAS TREATED THE IMPUG NED PAYMENT AS UNEXPLAINED INVESTMENT U/S 69 OF THE ACT DUE TO NON-DISCLOSURE OF THE SAME IN THE BALANCE SHEET OF ITA NO.1023/KOL/2016 A.Y. 2010-11 M/S ASHIM KR. CHATTERJEE VS. ITO WD-54(4) K OL. PAGE 7 THE ASSESSEE. THE DISALLOWANCES MADE BY THE AO WAS SUBSEQUENTLY CONFIRMED BY THE LD CIT(A). THE PROVISIONS OF SECTION 69 OF THE ACT, UNDER WHIC H THE IMPUGNED ADDITION HAS BEEN MADE READS AS UNDER : UNEXPLAINED INVESTMENTS. 69. WHERE IN THE FINANCIAL YEAR IMMEDIATELY PRECEDI NG THE ASSESSMENT YEAR THE ASSESSEE HAS MADE INVESTMENTS WHICH ARE NOT RECORD IN THE BOA, IF ANY, MAINTAINED BY HIM FOR ANY SOURCE OF INCOME, AND THE ASSESSEE OFFE RS NO EXPLANATION ABOUT THE NATURE AND SOURCE OF THE INVESTMENTS OR THE EXPLANATION OF FERED BY HIM IS NOT, IN THE OPINION OF THE [ASSESSING] OFFICER, SATISFACTORY, THE VALUE OF THE INVESTMENTS MAY BE DEEMED TO BE THE INCOME OF THE ASSESSEE OF SUCH FINANCIAL Y EAR. A PLAIN LOOK AT THE ABOVE PROVISIONS REVEALS THAT T HE PROVISIONS ARE ATTRACTED WHERE THE ASSESSEE HAS MADE INVESTMENTS WHICH ARE NOT RECORDE D IN THE BOOKS OF ACCOUNTS AND AT THE SAME TIME THE ASSESSEE EITHER DOES NOT OFFER AN Y EXPLANATION ORDER THE EXPLANATION IS NOT SATISFACTORY. ADMITTEDLY THE PAYMENT WAS MADE THROUGH BANKING CHA NNEL AND THE RELEVANT BANK WAS DISCLOSED BY THE ASSESSEE IN ITS RETURN OF INCO ME. BUT STILL THE QUESTION/ ISSUE REMAINS UNANSWERED I.E. ONCE THE PAYMENT HAS BEEN M ADE FROM THE DISCLOSED BANK ACCOUNT THEN WHERE THE EFFECT OF SUCH TRANSACTION H AS GONE IN THE BALANCE SHEET OF THE ASSESSEE. ON PERUSAL OF THE AO ORDER WE FIND THAT T HE ASSESSEE HAS MADE THE PAYMENT TO THE GGPL 2 TIMES IN THE YEAR UNDER CONSIDERATION FOR THE PURCHASE OF THE FLATS. THE 1 ST PAYMENT WAS OF RS. 9.86 LAKH WHICH HAS BEEN DULY D ISCLOSED IN THE BALANCE SHEET BUT THE 2 ND PAYMENT FOR RS.9.50 LAKH TO THE SAME PARTY AND FOR THE SAME TRANSACTION HAS NOT BEEN SHOWN IN THE NAME OF THE GGPL IN THE B ALANCE SHEET. NON-DISCLOSURE OF THE 2 ND PAYMENT HAS CREATED SUSPICION IN THE MIND OF THE A O AND IN THE ABSENCE OF ANY SATISFACTORY REPLY FROM THE ASSESSEE IN THIS REGARD , THE AO HAD RESORTED TO TREAT THE SAME AS UNEXPLAINED INVESTMENT U/S69 OF THE ACT. TH ERE IS NO DISPUTE THAT THE PAYMENT WAS MADE TO THE GGPL FOR RS.9.50 LAKH THOUGH BANK W HICH WAS DISCLOSED IN THE RETURN OF THE ASSESSEE. HOWEVER, THE PERTINENT ISSU E IS THAT THE SAME ENTRY IS NOT REFLECTING IN THE BALANCE SHEET OF THE ASSESSEE. TH EREFORE, IN OUR CONSIDERED VIEW THE INSTANT ISSUE NEEDS TO BE RE-EXAMINED BY THE AO. TH EREFORE, IN THE INTEREST OF JUSTICE AND FAIR PLAY WE ARE INCLINED TO REMIT THE ISSUE TO THE FILE OF AO FOR FRESH ADJUDICATION IN ACCORDANCE WITH THE LAW AND IN THE LIGHT OF ABOV E OBSERVATIONS. IT IS NEEDLESS TO ITA NO.1023/KOL/2016 A.Y. 2010-11 M/S ASHIM KR. CHATTERJEE VS. ITO WD-54(4) K OL. PAGE 8 MENTION THAT THE ASSESSEE SHOULD CO-OPERATE IN THE ASSESSMENT PROCEEDINGS BEFORE THE AO. HENCE, THIS GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED FOR THE STATISTICAL PURPOSES. 13. IN THE RESULT, ASSESSEES APPEAL STANDS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN OPEN COURT ON 03/03/2017 SD/- SD/- (S.S.VISWANETHRA RAVI) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER *DKP, SR.P.S ! - 03/03/2017 / KOLKATA / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-M/S ASHIM KUMAR. CHATTERJEE, 169B, RAJA DINENDRA STREET MANICKTALA , KOLKATA-700 004 2. /RESPONDENT-ITDO, WARD-54(4), 3 NO. GOVT. PLACE WES T, 1 ST FL, KOL-69 3. '# % / CONCERNED CIT 4. % - / CIT (A) 5. &'( ))'# , '# / DR, ITAT, KOLKATA 6. (*+ / GUARD FILE. BY ORDER/ , /TRUE COPY/ / '#,