Sri. G. Ravikumar, Hospet V. DCIT, Bangalore

ITA 1204/BANG/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 0354 (ITAT-BANGALORE)
• Duration Of Justice: 9 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-06-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 01-06-2016
• Assessment Year: 2005-2006
• Appeal Filed On: 01-09-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: B S BALACHANDRAN; BABUPRASAD S K
• Section: 32

Judgement Text

ITA.1204/BANG/2015 PAGE - 1 IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH 'B', BANGALORE SHRI. ABRAHAM P. GEORGE, ACCOUNTANT MEMBER I.T.A NO.1204/BANG/2015 (ASSESSMENT YEAR : 2005-06) SHRI. G. RAVI KUMAR, SANSKRUTHI 5 TH MAIN CROSS, BASAVESHWARA BADAVANE, HOSAPETE 583 201 .. APPELLANT PAN : ABPPR0135F V. DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE -1(1), BENGALURU .. RESPONDENT ASSESSEE BY : SHRI. BABUPRASAD S. K., ADVOCATE AND SHRI. B. S. BALACHANDRAN, ADVOCATE REVENUE BY : DR. P. K. SRIHARI, ADDL. CIT HEARD ON : 01.06.2016 PRONOUNCED ON : 10.06.2016 O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER : IN THIS APPEAL FILED BY ASSESSEE, FOLLOWING GROUND S HAVE BEEN RAISED : ITA.1204/BANG/2015 PAGE - 2 02. GRIEVANCE RAISED BY THE ASSESSEE IS ON ADDITION OF RS.17,00,000/-, U/S.68 OF THE INCOME-TAX ACT, 1961 (THE ACT IN S HORT). 03. FACTS APROPOS ARE THAT THERE WAS A SEARCH U/S.1 32 OF THE ACT, IN THE CASE OF SHRI. K. M. VISHWANATH, ON 10.12.2010. IT SEEMS AS A PART OF THIS, PREMISES OF THE ASSESSEE WAS ALSO SEARCHED. NOTICE U/S.153A OF THE ACT, WAS ISSUED ON THE ASSESSEE FOR FILING THE RETURN FO R THE IMPUGNED ASSESSMENT YEAR. ASSESSEE FILED A RETURN ON 08.10. 2012 IN PURSUANCE TO SUCH NOTICE DECLARING INCOME OF RS.97,860/-. AO NO TED THAT THE CAPITAL ACCOUNT FILED BY THE ASSESSEE ALONG WITH THIS RETUR N FILED ON 08.10.2012 WAS AT VARIANCE WITH THE CAPITAL ACCOUNT FILED BY THE ASSESSEE ALONG WITH HIS RETURN FILED U/S.139(1) OF THE ACT ON 03.09.2007. AS PER THE AO, OPENING CREDIT BALANCE IN THE CAPITAL ACCOUNT FILED ALONGWI TH THE RETURN ON ITA.1204/BANG/2015 PAGE - 3 08.10.2012 WAS RS.17,19,706/-, WHEREAS SUCH OPENING BALANCE IN THE CAPITAL ACCOUNT FILED ALONG WITH THE ORIGINAL RETUR N ON 03.09.2007 WAS ONLY RS.19,706.07. AO THEREFORE TREATED THE SUM OF RS. 17 LAKHS AS UNEXPLAINED INCOME AND COMPLETED THE ASSESSMENT BY MAKING AN AD DITION. 04. AGGRIEVED, ASSESSEE MOVED IN APPEAL BEFORE THE CIT (A). CIT (A) NOTED THAT IN THE STATEMENT OF AFFAIRS FILED ALONG WITH THE RETURN, PURSUANT TO NOTICE U/S.153A OF THE ACT, ASSESSEE HAD INCREASED ITS SUNDRY DEBTORS TO OFF SET THE INCREASE IN CAPITAL OF RS.17 LAKHS. AS PER THE CIT (A) THE INCREASED CAPITAL AND DEBTORS WERE SHOWN BY THE ASSESSEE IN T HE BALANCE SHEET AND THE CAPITAL ACCOUNTS FILED ALONG WITH THE RETURNS FOR S UBSEQUENT A. YS. 2006-07 AND 2007-08 AS WELL. HE WAS OF THE OPINION THAT TH IS WAS NOT A MISTAKE AS SUCH, BUT ONLY A BACK DOOR INTRODUCTION OF UNEXPLAI NED CAPITAL IN THE BOOKS OF ACCOUNT. HE SUSTAINED THE ADDITIONS MADE BY THE AO. 05. NOW BEFORE US, LD. AR STRONGLY ASSAILING THE OR DERS OF LOWER AUTHORITIES SUBMITTED THAT THE DIFFERENCE IN THE CA PITAL ACCOUNT WAS ONLY A MISTAKE THAT THE ASSESSEE MADE IN THE BALANCE SHEET FILED ALONG WITH THE RETURN ON 08.10.2012. ACCORDING TO HIM THE SUNDRY DEBTORS AS MENTIONED BY THE CIT (A) NEVER EXISTED. THERE WAS NO ENQUIRY CONDUCTED BY THE LOWER AUTHORITIES TO SUBSTANTIATE THEIR FINDING THA T THERE WAS ANY ASSET WHICH ITA.1204/BANG/2015 PAGE - 4 REPRESENTED THE INCREASED CAPITAL. AS PER THE LD. AR ASSESSEE COULD NOT BE PENALISED FOR A MISTAKE COMMITTED BY ITS REPRESENTA TIVE, WHILE FILING THE RETURN. 06. PER CONTRA, LD. DR SUBMITTED THAT THE MATTER CA N BE ONCE AGAIN LOOKED INTO BY THE AO FOR ASCERTAINING THE ACTUAL F ACTS. 07. WE HAVE PERUSED THE ORDERS AND HEARD THE CONTEN TIONS. FINDING OF THE CIT (A) IS THAT THE INCREASED CAPITAL OF RS.17, 00,000/- WAS REPRESENTED BY A SIMILAR INCREASE IN THE SUNDRY DEBTORS AND SUC H INCREASED SUNDRY DEBTORS WAS APPEARING IN THE BALANCE SHEET FOR THE SUBSEQUENT ASSESSMENT YEARS ALSO. THE QUESTION WHETHER THE INCREASED CAP ITAL, AND THE ENHANCED DEBTORS WERE ACTUAL AND WHETHER SUCH SUNDRY DEBTORS WERE THERE OR NOT, HAS NOT BEEN ADDRESSED BY THE LOWER AUTHORITIES. IN SU CH CIRCUMSTANCES, I AM OF THE OPINION THAT THE MATTER REQUIRES A FRESH VISIT BY THE AO. THEREFORE, ORDERS OF THE LOWER AUTHORITIES ARE SET ASIDE AND T HE ISSUE IS REMITTED BACK TO THE AO FOR CONSIDERATION AFRESH. ITA.1204/BANG/2015 PAGE - 5 08. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 10 TH DAY OF JUNE, 2016. SD/- (ABRAHAM P GEORGE) ACCOUNTANT MEMBER MCN COPY TO: 1. THE ASSESSEE 2. THE ASSESSING OFFICER 3. THE COMMISSIONER OF INCOME-TAX 4. COMMISSIONER OF INCOME-TAX(A) 5. DR 6. GF, ITAT, BANGALORE BY ORDER ASSISTANT REGISTRAR