Akula Rajaiah, Hyderabad V. DCIT, Central Circle-9, Hyderabad

ITA 1043/Hyd/2016

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 4820 (ITAT-HYDERABAD)
• Duration Of Justice: 5 year(s) 2 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB-B
• Next Hearing Date: 25-08-2021
• Assessment Year: 2008-2009
• Appeal Filed On: 21-07-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: T CHAITANYA KUMAR
• Section: 40A(3); 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B : HYDERABAD (THROUGH VIDEO CONFERENCE) BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER I.T.A. NO. 1043/HYD/2016 ASSESSMENT YEAR: 2008-09 AKULA RAJAIAH, HYDERABAD [PAN: AEZPA5824R] VS DY.COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-9, HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI T.CHAITANYA KUMAR, AR FOR REVENUE : SHRI ROHIT MUJUMDAR, DR DATE OF HEARING : 25-08-2021 DATE OF PRONOUNCEMENT : 30-09-2021 O R D E R PER S.S.GODARA, J.M. : THIS ASSESSEES APPEAL FOR AY.2008-09 ARISES FROM TH E CIT(A)-12, HYDERABADS ORDER DATED 21-01-2016 PASSED IN CASE NO.1053/2010-11, IN PROCEEDINGS U/S.143(3) OF THE IN COME TAX ACT, 1961 [IN SHORT, THE ACT]. HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. THE ASSESSEES SOLE SUBSTANTIVE GRIEVANCE PRESSED DURING THE COURSE OF HEARING SEEKS TO REVERSE BOTH THE LOWER AUTHORITIES ACTION DISALLOWING HIS CLAIM OF RS.72 LA KHS TO HAVE BEEN PAID TO THE FARMERS/VENDORS; IN THE COURSE OF ITA NO. 1043/HYD/2016 :- 2 -: ASSESSMENT DT.30-12-2010 AND AFFIRMED IN THE CIT(A)S LOWER APPELLATE ORDER READING AS UNDER: 5.5 COMING TO THE ISSUE OF RECEIPT OF RS. 90,00,00 0/- AND PAYMENT OF RS.72,00,000/- TO THE PURPORTED CLAIMANTS AS LAN D OWNERS, IT MAY BE RELEVANT TO OBSERVE THAT THOUGH IT HAS BEEN CONF IRMED BY THE 4 COMPANIES/PARTIES THAT THE AMOUNTS THAT WERE PAID T O ASSESSEE WERE REPRESENTED THE AMOUNTS TOWARDS GETTING PHYSICAL PO SSESSION OF LANDS, BUT IT WAS NOT ELABORATED AS TO THE DETAILS OF LANDS, THE TRANSACTIONS AND THE NAMES OF THE PARTIES, INTENDED TO BE PAID WITH THE AMOUNTS. THE APPELLANT COULD NOT PROVE THE BASI S/BACKGROUND FOR RECEIPT OF SUCH AMOUNTS FROM 4 PARTIES, SUCH AS THE SALE DEEDS, THE DETAILS OF LANDS, DETAILS OF LITIGATION, CORRESPOND ENCE ETC., INDICATING THE NATURE OF THE PAYMENTS, SO AS TO CLASSIFY THEM AS CAPITAL OR REVENUE RECEIPTS. NO EVIDENCE TOWARDS THE LIABILITY ON THE PART OF THE PARTIES WHO PAID THE AMOUNTS AND THE RIGHTS OR BASI S FOR THE LANDLORDS/LAND OWNERS TO RECEIVE SUCH AMOUNTS, WHIL E INDICATING THE LOCUS STANDI OF THE ASSESSEE IN THIS REGARD, WERE F URNISHED EITHER BY THE CONFIRMING PARTIES OR THE ASSESSEE, EITHER AT T HE STAGE OF ASSESSMENT OR THE APPELLATE PROCEEDINGS. THE ANALYS IS OF THE SAID ISSUE, FURTHER REVEAL THAT THE AMOUNTS SHOWN TO HAV E BEEN PAID BY THE ASSESSEE THROUGH HIS BANK ACCOUNTS ARE IN CASH, AND THE AMOUNTS SHOWN AGAINST THE NAMES OF THE LAND OWNERS/ LAND LORDS AND LANDS STANDING AGAINST THEIR NAMES DO NOT REPRE SENT ANY BASIS. WHILE SHOWING THE PAYMENTS TO LAND OWNERS, THE ASSE SSEE USED BEARER CHEQUES, WITH EACH CHEQUE USED FOR MAKING PA YMENTS TO 3 PERSONS TO 22 PERSONS AT A TIME AND THE AMOUNTS SHO WN TO HAVE BEEN PAID TO EACH OF THE LAND OWNER, DO NOT MATCH WITH L AND HOLDINGS SHOWN AGAINST THEIR NAMES. FURTHER, THERE IS NO REA SON FOR THE CONFIRMING PARTIES TO PAY THE ASSESSEE, HAVING BROU GHT THE LANDS FROM HIM AS A GPA HOLDER. FURTHER, THE AMOUNTS WERE SHOW N TO HAVE BEEN PAID THROUGH BEARER CHEQUES, THROWING THE VERIFIABL E NATURE OF INFORMATION IN DOUBT. IT IS ALSO RELEVANT TO OBSERV E THAT, THE 'RECEIPTS AND PAYMENTS ACCOUNT' PREPARED FOR THE PERIOD 01.04 .2007 TO 31.03.2008, INDICATE THE PAYMENTS OF RS.30,00,000/- ON 07.04.2007, FROM M/S.MITI GREEN LANDS PVT. LTD, RS. 35,00,000/- 02.05.2007 FROM M/S. RANGEETH AGRO FARMS PVT. LTD., RS. 12,50,000/- ON 15.06.2007 FROM NAGAGIRI AGRO FARMS PVT. LTD. AND RS. 12,50,00 0/- ON 15.06.2007 FROM M/S. PANCHAPADL AGRO FARMS PVT. LTD ., AS 'DEVELOPMENT CHARGES', BUT NOT AS CHARGES FOR PHYSI CAL POSSESSION OF LANDS. CONSIDERING ALL THESE FACTS, IT IS REASONABL E TO HOLD THE AMOUNTS OF RS. 90,00,000/RECEIVED BY THE ASSESSEE, CREDITED THROUGH THE BANK ACCOUNTS, CERTAINLY REPRESENTED BUSINESS R ECEIPTS FOR THE ASSESSEE. HAVING TREATED THE AMOUNTS AS BUSINESS RE CEIPTS, THE ONUS WAS ON THE ASSESSEE TO PAY THE CLAIMS OF EXPENSES/T HE AMOUNTS SET ITA NO. 1043/HYD/2016 :- 3 -: OFF AGAINST THE RECEIPTS, THROUGH CROSSED CHEQUES T O COMPLYING WITH THE PROVISIONS OF SEC. 40A(3) AND ALSO BY MAKING TD S. HAVING FAILED TO COMPLY WITH THE SAME, AND HAVING FAILED TO PROVE THE GENUINENESS OF THE AMOUNTS INCURRED AS PAYMENTS/EXPENSES, AGAIN ST SUCH RECEIPTS, THE CLAIM OF THE ASSESSEE HAVE BECOME DIS ALLOWABLE CLAIM. THUS, THE ENTIRE RECEIPTS BECOME THE INCOME OF THE ASSESSEE AND HAVING CONSIDERED RS. 18,00,000/- AS CONSULTANCY CH ARGES IN PROFIT & LOSS ACCOUNT, THE BALANCE OF RS. 72,00,000/- ( RS. 90,00,000- RS.18, 00,000) IS TREATED AS THE ADDITIONAL INCOME IN THE HANDS OF THE ASSESSEE FOR THE YEAR UNDER REFERENCE AND THE ADDIT ION MADE BY THE AO, UNDER THIS HEAD TO THE EXTENT OF RS. 72,00,000/ - TO THE INCOME RETURNED IS HELD AS SUSTAINABLE. THE GROUNDS RELATA BLE TO THIS ISSUE ARE TREATED AS DISMISSED. 3. LEARNED COUNSEL VEHEMENTLY CONTENDED BEFORE US TH AT BOTH THE LOWER AUTHORITIES HAVE ERRED IN LAW AND ON FAC TS IN MAKING THE IMPUGNED DISALLOWANCE. HE REITERATES THE ASSESSEES STAND THROUGHOUT THAT HE HAD RECEIVED AN AMO UNT OF RS.90 LAKHS FROM VARIOUS COMPANIES, INTER ALIA ARRANGED LAND TRANSACTIONS FOR THEM AND PAID THE CONSIDERATION M ONEY ON THEIR BEHALF TO THE LAND OWNERS. AND THAT THE IMPUGN ED SUM OF RS.72 LAKHS ALSO INVOLVES THE VERY NATURE OF PAYMENTS ONLY. MR.CHAITANYA KUMAR FURTHER INVITED OUR ATTENTION TO THE ASSESSEES PETITION SEEKING TO ADMIT ADDITIONAL EVIDEN CE AS WELL AS A HARD DISK. LEARNED COUNSEL STATED THAT THE ASSESSE ES FOREGOING HARD DISK AND DOCUMENTARY EVIDENCE(S) SUFF ICIENTLY PROVE HIS CASE TO HAVE OBTAINED THE MONEY(IES) IN QUES TION FROM VARIOUS COMPANIES TO BE PASSED ON TO THE VENDORS CONCERNED. HE EMPHASISED THAT THE FOREGOING HARD DIS K DULY CONTAINS THE PHOTOGRAPHS OF THE VENDORS AS WELL. HE LAS TLY PIN- POINTED THAT THE DEPARTMENT HAD TAKEN TIME ON 12-06-2018 F OR VERIFICATION OF THE FOREGOING HARD DISK AND THEREFORE , INSTANT ITA NO. 1043/HYD/2016 :- 4 -: ISSUE DESERVES TO BE DECIDED IN ASSESSEES FAVOUR ON ACCOUNT OF NO REMAND REPORT COMING FROM THE LATTERS SIDE. 4. MR.MUJUMDAR HAD STRONGLY SUPPORTED THE IMPUGNED DISALLOWANCE MADE IN BOTH THE LOWER PROCEEDINGS. 5. WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO RIVAL PLEADINGS AND FIND NO FORCE IN ASSESSEES STAND. TH IS IS INTER ALIA FOR THE REASON THAT ALTHOUGH HE HAS DULY EXPLAINED THE SOURCE OF SUM OF RS.90 LAKHS COMING FROM VARIOUS COMPANIES/VENDEES, THERE IS NO RECONCILIATION FILED BEFORE QUA THE IMPUGNED SUM OF RS.72 LAKHS HAVING BEEN PASSED O VER TO THE VENDORS. WE MAKE IT CLEAR LEARNED COUNSEL HAS RE LIED UPON THE ASSESSEES ALLEGED HARD DISK AS WELL AS ADDITIONA L DOCUMENTARY EVIDENCE, THE SAME ARE FOUND TO BE LACKING THE CLINCHING THREE FOLDED NEXUS BETWEEN VENDORS/FARMER S, VENDEES/COMPANIES AND HIMSELF AS THE CASE MAY BE. IT WAS VERY MUCH INCUMBENT ON HIM TO FILE THE DETAILED RECONCI LIATION OF THE AMOUNT RECEIVED VIZ AMOUNT INVOLVING THE COMPAN IES AND THE LAND OWNERS; RESPECTIVELY ALONGWITH THE CORRE SPONDING SALE DEEDS AS WELL WHICH HE HAS FAILED TO DO SO. WE THUS SEE NO REASON TO ACCEPT THE ASSESSEES FOREGOING CONTENTION S SEEKING A REMAND REPORT AS WELL FROM THE DEPARTMENT IN ABSENCE OF A VALID ADMISSION OF HIS ADDITIONAL EVIDE NCE AS PER RULES 29 TO 31 OF THE APPELLATE TRIBUNAL RULES, 1963. AND MORE SO, WHEN THERE IS NO CERTIFICATION ON THE PART OF A SSESSEE THAT HIS HARD DISK IN ISSUE SATISFIES THE BASIC PARAMETE RS OF AN ELECTRONIC RECORD OR DATA; AS THE CASE MAY BE U/S.2(T) OF THE INFORMATION TECHNOLOGY ACT. WE THUS SEE NO REASON TO ITA NO. 1043/HYD/2016 :- 5 -: INTERFERE WITH BOTH THE LEARNED LOWER AUTHORITIES HAVI NG BEEN MAKING THE IMPUGNED DISALLOWANCE OF RS.72 LAKHS IN ASSESSEES HANDS. THE SAME STANDS CONFIRMED. NO OTHER ARGUMENT/GROUND HAS BEEN PRESSED BEFORE US. 6. THIS ASSESSEES APPEAL IS DISMISSED IN ABOVE TERM S. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH SEPTEMBER, 2021 SD/- SD/- (LAXMI PRASAD SAHU) (S.S.G ODARA) ACCOUNTANT MEMBER JUDICIAL MEM BER HYDERABAD, DATED: 30-09-2021 TNMM ITA NO. 1043/HYD/2016 :- 6 -: COPY TO : 1.AKULA RAJAIAH, C/O.SHRI T.CHAITANYA KUMAR, ADVOCA TE, FLAT NO.102, GOU RI APARTMENT, URDU LANE, HIMAYATNAGAR, HYDERABAD. 2.DY.COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-9, HYDERABAD. 3.CIT(APPEALS)-12, HYDERABAD. 4.PR.CIT(CENTRAL)-HYDERABAD. 5.D.R. ITAT, HYDERABAD. 6.GUARD FILE.