Sri Mukti Roy , Hooghly V. ITO, Ward - 23(3), Hooghly , Hooghly

ITA 119/KOL/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 5701 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 25-01-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: KALYAN NATH CITSRDR
• Assessee Lawyers: MIRAJ D. SHAH
• Keywords: Bogus purchase; Business income
• Section: 44AD; 40A(3); 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH SMC KOLKATA BEFORE SHRI S.S, GODARA, JUDICIAL MEMBER ITA NO.119/KOL/2018 ASSESSMENT YEAR:2010-11 SR MUKTI ROY 27A, BHATTACHARJEE GARDEN LANE, P.O. SERAMPORE, HOOGHLY, PIN-712203 [ PAN NO.ADUPR 0648 E ] / V/S . INCOME TAX OFFICER, WARD-23(3), AAYAKAR BHAWAN, KHADINAMORE, CHINSURAH, HOOGHLY- 712101 /APPELLANT .. /RESPONDENT /BY APPELLANT SHRI MIRAJ D SHAH, ADVOCATE /BY RESPONDENT SHRI KALYAN NATH, ADDL. CIT-SR-DR /DATE OF HEARING 24-01-2019 /DATE OF PRONOUNCEMENT 31-01-2019 /O R D E R THIS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2010-11 , ARISES AGAINST THE COMMISSIONER OF INCOME-TAX (APPEALS)-6, KOLKATAS O RDER DATED 19.09.2017 PASSED IN CASE NO. 272/CIT(A)-6/KOL/2013-14 INVOLVING PROCEED INGS U/S. 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. THE ASSESSEES FIRST SUBSTANTIVE GROUND SEEKS TO DELETE BOGUS PURCHASE DISALLOWANCE / ADDITION OF 4 LAC. BOTH THE LOWER AUTHORITIES HAVE DECLINED TH E ABOVE EXPENDITURE UNDER THE HEAD RIGHT TO SALE OF LAND PAID TO VARIOUS LAND OWNERS. THE ASSESSEE IS ADMITTEDLY ENGAGED IN SALE-PURCHASE OF LAND AND BUILDING MATERIALS BUSINESS. THE CIT(A) IS OF THE VIEW THAT SINCE THE ASSESSEE HAS NOT GOT THE RELEVANT PURCHASE REGISTERED, THE IMPUGNED SUM IS NOT ALLOWA BLE. LEARNED DEPARTMENTAL REPRESENTATIVE FAILS TO DISPUTE THAT THIS ASSESSEE IS ENGAGED IN LAND PULLING BUSINESS AND HIS CORRESPONDING SALES HAVE BEEN ALREADY TREAT ED AS BUSINESS INCOME. I CONCLUDE IN THIS PECULIAR FACTS THAT BOTH THE LOWER AUTHORITIES HAVE ERRED IN DISALLOWING ITA NO.119/KOL/2018 A.Y. 2010-1 1 SRI MUKTI ROY VS. ITO WD-23(3) HGY PAGE 2 ASSESSEES LAND PURCHASES OF 4 LAC IN ISSUE. I THEREFORE DELETE THIS DISALLOWA NCE AMOUNT KEEPING IN MIND THESE PECULIAR FACTS AND CIR CUMSTANCES. 3. THE ASSESSEE DOES NOT PRESS FOR HIS SECOND SUBST ANTIVE GROUND CHALLENGING CORRECTNESS OF ACTUAL LEGAL EXPENSE DISALLOWANCE/ A DDITION OF 50,202/-. THE SAME STAND CONFIRMED ACCORDINGLY. 4. LASTLY COMES SEC. 40A(3) DISALLOWANCE OF 6,42,451/-. IT TRANSPIRES DURING THE COURSE OF HEARING THAT THE ASSESSEE HAD MADE CASH P URCHASES IN BUILDING MATERIAL BUSINESS ALREADY ASSESSED IS PRESUMPTIVE RATE OF TA XATION U/S. 44AD OF THE ACT AS A SEPARATE BUSINESS. THIS TRIBUNAL CO-ORDINATE BENCH S DECISION IN ACIT VS. RAMESHCHANDRA R PATEL (2005) 94 TTJ 361 (AHD) HOLDS THAT 40A(3) DOES NOT APPLY IN CASE OF PRESUMPTIVE SCHEME OF TAXATION U/S 44AD OF THE ACT. I THEREFORE ACCEPT ASSESSEES INSTANT THIRD SUBSTANTIVE GROUND TO DELE TE THE AMOUNT THE SEC. 40A(3) OF THE ACT. 5. THIS ASSESSEES APPEAL IS PARTLY ALLOWED IN TERM S OF ABOVE TERMS. ORDER PRONOUNCED IN OPEN COURT ON 31/01/2019 SD/- (S.S. GODARA) JUDICIAL MEMBE R KOLKATA, *DKP/SR.PS - 31/01/2019 / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-SRI MUTI ROY, 27A, BHATTACHARJEE GARDEN LANE, PO. SERAMPORE, HOOGHLY, PIN-712203 2. /RESPONDENT-ITO WD-23(3), AAYAKAR BHAWAN, KHADINAMO RE, CHINSURAH HOOGHLY-712101 3. ' % / CONCERNED CIT 4. % - / CIT (A) 5. & ))' , ' / DR, ITAT, KOLKATA 6. + / GUARD FILE. BY ORDER/ , /TRUE COPY/ / ',