Sailesh Kumar Agarwal, Hyd, Hyderabad V. ITO, Ward-5(2),Hyd, Hyderabad

ITA 1081/HYD/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 6204 (ITAT-HYDERABAD)
• Duration Of Justice: 6 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-02-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 12-08-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: A SITARAMA RAO
• Assessee Lawyers: P MURALI MOHAN RAO

Judgement Text

1 ITA.NO.1081/HYD/2016 SRI SAILESH KUMAR AGARWAL, HYDERABAD. IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A (SMC) : HYDERABAD BEFORE SHRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER ITA.NO.1081/HYD/2016 ASSESSMENT YEARS 2010-2011 SRI SAILESH KUMAR AGARWAL HYDERABAD. PAN AAYPA8954F VS. THE INCOME TAX OFFICER WARD-5(2) HYDERABAD. (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI P. MURALIMOHAN RAO FOR REVENUE : SHRI A. SITARAMA RAO DATE OF HEARING : 14.02.2017 DATE OF PRONOUNCEMENT : 14.02.2017 ORDER THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-4 ON THE FOLLOWING GROUNDS : 1. THE ORDER OF THE CIT(A)-4, HYDERABAD IS ERRONEOUS BOTH ON FACTS AND IN LAW. 2. THE LD. CIT (A) ERRED IN SUSTAINING THE DISALLOWANC E OF RS.47,101 CLAIMED AS STANDARD DEDUCTION IN THE COMPUTATION OF INCOME FROM HOUSE PROPERTY, WHICH IS CALCULATED @ 30% OF RENT R ECEIVED OF RS.1,57,004/ -. 3. THE LD. CIT(A) OUGHT TO HAVE APPRECIATED THE FACT T HAT LAND GIVEN TO TENANT WAS NOT AN OPEN LAND, A STRUCTURE WAS BUILT ON THE LAND AND ELIGIBLE FOR STANDARD DEDUCTION. 4. THE LD. CIT (A) OUGHT TO HAVE APPRECIATED THE CERTI FICATE GIVEN BY THE TENANT I.E. M/ S RAMCOR MARKETING PVT. LTD WHIC H IS CLEARLY STATED THAT THERE IS A STRUCTURE BUILT AT THE PLOT. 2 ITA.NO.1081/HYD/2016 SRI SAILESH KUMAR AGARWAL, HYDERABAD. 5. THE LD. CIT (A) ERRED IN NOT ADJUDICATING ON THE GR OUND TAKEN IN RESPECT OF DISALLOWANCE OF STANDARD DEDUCTION OF RS .9,540 FROM CHARGES OF RS.31,800. 6. THE LD. CIT(A) ERRED IN SUSTAINING THE DISALLOWANCE OF RS.9,540 CLAIMED AS STANDARD DEDUCTION @ 30% OF AMENITIES OF RS.31,800 WHICH IS PART OF RENTAL INCOME ONLY . 7. THE LD. CIT (A) OUGHT TO HAVE APPRECIATED THE FACT THAT ASSESSEE HAS RECEIVED RENT OF RS.84,800 FOR THE BUILDING AS PER LEASE DEED WHICH INCLUDES RENT OF RS. 53,000 AND AMENITIES OF RS.31,800 AND BOTH THE COMPONENT ARE ELIGIBLE FOR STANDARD DEDUCT ION. 8. THE LD. CIT(A) ERRED IN CONFIRMING THE ADDITION MAD E OF RS.20,29,499 UNDER SECTION 69A OF THE ACT. 9. THE LD. CIT(A) OUGHT TO HAVE APPRECIATED THE FACT T HAT ASSESSEE HAS MADE CASH DEPOSIT IN BANK ACCOUNT OUT OF GROSS RECE IPTS FROM THE FATHERS GUNNY BAG BUSINESS. 10. THE LD. CIT(A) OUGHT TO HAVE APPRECIATED THAT THE A .O. HAS ADDED TOTAL AMOUNT OF RS.20,29,499 WHICH IS GROSS RECEIPT FROM GUNNY BAG BUSINESS AND EVEN THOUGH IF ADDITION IS MADE IT SHO ULD BE AT REASONABLE PROFIT PERCENTAGE WHICH IS BETWEEN 3% OR 4% IN SAME LINE OF BUSINESS. 11. THE ASSESSEE MAY ADD, ALTER OR MODIFY OR SUBSTITUTE ANY OTHER POINT TO THE GROUNDS OF APPEAL AT ANY TIME BEFORE OR AT T HE TIME OF HEARING OF THE APPEAL. 2. AFTER HEARING RIVAL CONTENTIONS, I FIND THAT THE ASSES SEE SUBMITTED THAT THEY ARE IN THE BUSINESS OF PURCHASE AND SALE OF O LD AND NEW GUNNY BAGS FOR THE LAST 50 YEARS AND THAT THE DEPARTMENT HAS AC CEPTED THE SAME IN THE EARLIER YEAR. THE DEPOSITS IN THE BANK ACC OUNTS WERE THE TRANSACTIONS I.E., PURCHASE AND SALE TRANSACTIONS OF O LD AND NEW GUNNY BAGS. THIS EXPLANATION WAS ACCEPTED BY THE VERY SAME A.O. I.E., ITO, WARD-5(2), HYDERABAD FOR THE PREVIOUS A.Y. 2009-2010 AND THE DEPOSITS FROM THIS BANK ACCOUNT WERE CONSIDERED AS TURNOVER OF THE ASSESSEE AND PROFIT ON THE SAME WAS TAXED AT 8%. 3 ITA.NO.1081/HYD/2016 SRI SAILESH KUMAR AGARWAL, HYDERABAD. 3. DURING THE IMPUGNED A.Y. THE A.O. HAS NOT COMPUTED TH E INCOME IN THE SAME MANNER AS IN THE PREVIOUS YEAR. HE HAS AD DED THE PEAK DEPOSITS BY REJECTING THE CLAIM OF THE ASSESSEE THAT THE D EPOSITS IN THE BANK ACCOUNT IS TURNOVER OF THE ASSESSEE. 4. IN VIEW OF THE ABOVE, I AM OF THE VIEW THAT, THERE SH OULD BE CONSISTENCY ON THE PART OF THE A.O. THE DEPOSITS IN THE B ANK ACCOUNT SHOULD BE TAKEN AS THE TURNOVER OF THE ASSESSEE FROM PU RCHASE AND SALE OF OLD AND NEW GUNNY BAGS. THE INCOME SHOULD BE ASS ESSED TO TAX AT 8% OF SUCH TURNOVER AS WAS DONE IN THE PREVIOUS YEAR. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLO WED. ORDER PRONOUNCED IN THE OPEN COURT ON 14.02.2017. SD/- (J. SUDHAKAR REDDY) ACCOUNTANT MEMBER HYDERABAD, DATED 14 TH FEBRUARY, 2017 VBP/- COPY TO 1. SHRI SAILESH KUMAR AGARWAL, HYDERABAD. C/O. P. MURALI & CO., CHARTERED ACCOUNTANTS, 6-3-655/ 2/3, 1 ST FLOOR, SOMAJIGUDA, HYDERABAD 82. 2. THE INCOME TAX OFFICER, WARD-5(2), HYDERABAD. 3. CIT(A)-4, 2 ND FLOOR, A BLOCK, I.T. TOWERS, A.C. GUARDS, MASAB TANK, HYDERABAD 500 004. 4. PR. CIT-4, HYDERABAD. 5. D.R. ITAT A (SMC) BENCH, HYDERABAD. 6. GUARD FILE.