V.Gurunathan, CHENNAI V. ITO, CHENNAI

ITA 1212/CHNY/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 5700 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 6 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-11-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 22-06-2017
• Assessment Year: 2005-2006
• Appeal Filed On: 20-05-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SAILENDRA MAMMIDI
• Assessee Lawyers: T BANUSEKAR
• Keywords: Peak credit

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH: CHENNAI , ! . , ' BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER , AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ ITA NO.661/MDS/2015 /ASSESSMENT YEAR: 2005-06 SHRI V.G.RAJENDRAN, NO.19, OLD NO.4B, GOVINDAN STREET, AYYAVOO COLONY, AMINJIKARAI, CHENNAI-600 029. VS. THE ASST. COMMISSIONER OF INCOME TAX, BUSINESS CIRCLE- XIII, CHENNAI-600 034. [PAN: AABPR 8106 R ] ( & /APPELLANT) ( '(& /RESPONDENT) ./ ITA NO.1351/MDS/2015 /ASSESSMENT YEAR: 2005-06 THE INCOME TAX OFFICER, NON-CORPORATE WARD-20(2), CHENNAI. VS. SHRI V.GURUNATHAN, NO.6/189, Z-BLOCK, AP-970, 5 TH STREET, ANNA NAGAR, CHENNAI-600 040. [PAN: AAMPG 9705 E ] ( & /APPELLANT) ( '(& /RESPONDENT) ./ ITA NO.1212/MDS/2015 /ASSESSMENT YEAR: 2005-06 SHRI V.GURUNATHAN, NO.6/189, Z-BLOCK, AP-970, 5 TH STREET, ANNA NAGAR, CHENNAI-600 040. [PAN: AAMPG 9705 E] VS. THE INCOME TAX OFFICER, SALARY WARD-II(1), CHENNAI. ( & /APPELLANT) ( '(& /RESPONDENT) ITA NO.661/MDS/2015 ITA NO.1351/MDS/2015 ITA NO.1212/MDS/2015 & CO NO.134/MDS/2015 :- 2 -: CROSS - OBJECTION NO.134 /MDS/20 15 /ASSESSMENT YEAR: 2005-06 SHRI V.GURUNATHAN, NO.6/189, Z-BLOCK, AP-970, 5 TH STREET, ANNA NAGAR, CHENNAI-600 040. VS. THE INCOME TAX OFFICER, NON-CORPORATE WARD-20(2), CHENNAI. [PAN: AAMPG 9705 E ] ( & /APPELLANT) ( '(& /RESPONDENT) ASSESSEE BY : MR.T.BANUSEKAR, CA DEPARTMENT BY : MR.SAILENDRA MAMMIDI, CIT * /DATE OF HEARING : 23.11.2017 * /DATE OF PRONOUNCEMENT : 23.11.2017 / O R D E R PER GEORGE MATHAN , JUDICIAL MEMBER : ITA NO.661/MDS/2015 IS AN APPEAL FILED BY THE ASSE SSEE SHRI V.G.RAJENDRAN AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-12, CHENNAI, IN ITA NO.1843/2013-14 DATED 22.12.2014 FOR THE AY 2005-06. ITA NO.1351/MDS/2015 IS AN APPEAL FILED BY THE REVENUE, ITA NO.1212/MDS/2015 IS AN APPEAL FILED BY THE ASSE SSEE & CO NO.134/MDS/2015 IS A CROSS-OBJECTION FILED BY THE A SSESSEE IN THE REVENUES APPEAL NO.1351/MDS/2015 IN THE CASE OF SH RI V.GURUNATHAN, AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-11, CHENNAI, IN ITA NO.104/2013-14 DATED 12.11.2014 FOR THE AY 2005-06. 2. MR. SAILENDRA MAMMIDI, CIT, REPRESENTED ON BEHAL F OF THE REVENUE AND MR. T.BANUSEKAR, CA, REPRESENTED ON BEHALF OF T HE ASSESSEE. ITA NO.661/MDS/2015 ITA NO.1351/MDS/2015 ITA NO.1212/MDS/2015 & CO NO.134/MDS/2015 :- 3 -: 3. IT WAS SUBMITTED BY THE LD.AR THAT SHRI V.GURUNA THAN IS THE FATHER AND SHRI V.G.RAJENDRAN IS THE SON. BOTH THE ASSESS EES ARE DOING REAL- ESTATE BUSINESS. AS THE ISSUES IN ALL THE APPEALS WERE INTERCONNECTED, THE APPEALS ARE BEING DISPOSED OFF BY THIS COMMON ORDER . 4. IT WAS SUBMITTED AT THE TIME OF HEARING THAT THE ASSESSEE DID NOT WISH TO PRESS THE CROSS-OBJECTION NO.134/MDS/2015. CONSEQUENTLY, THE CROSS-OBJECTION FILED BY THE ASSESSEE IS DISMISSED AS WITHDRAWN. 5. IT WAS SUBMITTED BY THE LD.AR THAT THERE WAS A S URVEY ON THE PREMISES OF BOTH THE ASSESSEES ON 09.03.2012. ON T HE BASIS OF THE EVIDENCES FOUND IN THE COURSE OF THE SURVEY, THE AS SESSMENTS FOR THE AYS 2005-06 AND 2006-07 WERE RE-OPENED AND COMPLETED BY BRINGING TO TAX VARIOUS PEAK CREDITS APPEARING IN THE VARIOUS UNACC OUNTED BANK ACCOUNTS THAT THE ASSESSEES OPERATED. IT WAS A SUBMISSION T HAT NINE UNACCOUNTED BANK ACCOUNTS HAD BEEN FOUND. IT WAS A SUBMISSION THAT IDENTICAL ADDITIONS HAD BEEN MADE IN BOTH THE HANDS. IT WAS A SUBMISSION THAT FOR THE AY 2006-07, AN ADDITION OF RS.2,99,50,700/- HAD BEEN MADE IN THE ASSESSMENT IN THE CASE OF SHRI V.G.RAJENDRAN VIDE A N ORDER DATED 21.03.2014. IT WAS A SUBMISSION THAT THIS WAS MAD E ON THE BASIS OF DDIT INVESTIGATION, UNIT-IV(2), CHENNAI-34, REPORT, WHEREIN AFTER ANALYZING OF THE BANK ACCOUNTS, THE PEAK CREDITS WA S WORKED OUT TO ITA NO.661/MDS/2015 ITA NO.1351/MDS/2015 ITA NO.1212/MDS/2015 & CO NO.134/MDS/2015 :- 4 -: RS.2,72,46,400/-. IT WAS A SUBMISSION THAT AS THE PEAK CREDITS IN RESPECT OF THE BANK ACCOUNTS HAVING BEEN BROUGHT TO TAX IN THE HANDS OF SHRI V.G.RAJENDRAN FOR THE AY 2006-07, NO FURTHER ADDITI ONS WERE CALLED FOR IN THE HANDS OF THE ASSESSEES. IT WAS A SUBMISSION THA T THE ASSESSEE HAD NO OBJECTION IF THE SAME WAS VERIFIED BY THE AO. 6. IN REPLY, THE LD.DR SUBMITTED THAT THE ISSUES IN ALL THE APPEALS COULD BE RESTORED TO THE FILE OF THE AO WITH SPECIFIC DIR ECTIONS. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. AS IT IS NOTICED THAT THE ASSESSEE HAS FILED ASSESSMENT ORDER IN THE CASE OF SHRI V.G.RAJENDRAN FOR THE AY 2006-07, WHEREIN THE ANALYSIS OF THE BANK AC COUNTS FOUND IN THE COURSE OF THE SURVEY HAS BEEN DONE BY THE DDIT INVE STIGATION AND THE SAME HAS BEEN CONSIDERED WHILE MAKING THE ADDITION OF RS.2,99,57,700/- AND IT HAS BEEN CLAIMED BY THE ASSESSEE THAT THE SA ME HAS REACHED FINALITY, THE ISSUES IN ALL THE THREE APPEALS BEING THE APPEAL IN THE CASE OF SHRI V.G. RAJENDRAN IN ITA NO.661/MDS/2015, THE APP EAL OF THE REVENUE IN THE CASE OF SHRI V.GURUNATHAN IN ITA NO.1351/MDS /2015 AND THE APPEAL OF THE ASSESSEE SHRI V.GURUNATHAN IN ITA NO.1212/MD S/2015 ARE RESTORED TO THE FILE OF THE AO FOR RE-ADJUDICATION AFTER VER IFYING AS TO WHETHER THE ADDITION OF RS.2.99 CR. INCLUDES, THE PEAK CREDITS IN RESPECT OF THE UNDISCLOSED BANK ACCOUNTS FOUND IN THE COURSE OF SE ARCH IN THE CASE OF SHRI V.G.RAJENDRAN AND SHRI V.GURUNATHAN, THE FATHE R AND THE SON. ITA NO.661/MDS/2015 ITA NO.1351/MDS/2015 ITA NO.1212/MDS/2015 & CO NO.134/MDS/2015 :- 5 -: 8. AO HAS TO VERIFY AS TO WHETHER THE AMOUNT OF RS. 53,74,548/- ADDED IN THE HANDS OF SHRI V.G.RAJENDRAN IS IN RESPECT OF BANK ACCOUNT NO.5679 WITH KARNATAKA BANK AND AS TO WHETHER THE SAME HAS BEEN INCLUDED WHEN COMPUTING THE PEAK CREDITS ADDITION OF RS.2.99 CR. IF THE SAME IS NOT INCLUDED IN THE ADDITION OF RS.2.99 CR., THE PRE-CR EDIT IN RESPECT OF THE SAID BANK ACCOUNT IS TO BE ADDED IF THE SAME IS INCLUDED , NO FURTHER ADDITION IS TO BE MADE. THE AO HAS TO VERIFY WHETHER THE AMOUN T OF RS.75.00 LAKHS ADDED IS IN RESPECT OF ANY OF THE UNDISCLOSED BANK ACCOUNT WHICH HAVE BEEN FOUND IN THE COURSE OF SEARCH AND THE PEAK CRE DITS ADDED REPRESENTING RS.2.99 CR. IF THE ANSWER IS YES, NO FURTHER ADDITION IS CALLED FOR, IF THE ANSWER IS NO, THEN THE ADDITI ON ON THIS ACCOUNT IS TO BE RESTRICTED TO RS.7.50 LAKHS AS CONFIRMED BY THE ASS ESSEE IN HIS LETTER DATED 05.10.2012 ADDRESSED TO THE ACIT, UNIT-IV(2), CHENN AI. IF THE ADDITION OF RS.2.99 CR. INCLUDES THE PEAK CREDITS IN RESPECT OF THE BANK ACCOUNTS CONSIDERED IN THE HANDS OF SHRI V.GURUNATHAN THEN N O FURTHER ADDITION ON THE SAME IS LIABLE TO BE MADE IN THE HANDS OF SHRI V.GURUNATHAN. WITH THESE DIRECTIONS, THE APPEALS IN BOTH THE ASSESSEES CASES ARE RESTORED TO THE FILE OF THE AO FOR RE-ADJUDICATION. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE SHRI V.G.RAJENDRAN IN ITA NO.661/MDS/2015, THE REVENUES APPEAL IN THE CA SE OF SHRI V.GURUNATHAN IN ITA NO.1351/MDS/2015 AND THE ASSESS EES APPEAL IN THE CASE OF SHRI V.GURUNATHAN IN ITA NO.1212/MDS/2015 S TANDS PARTLY ALLOWED ITA NO.661/MDS/2015 ITA NO.1351/MDS/2015 ITA NO.1212/MDS/2015 & CO NO.134/MDS/2015 :- 6 -: FOR STATISTICAL PURPOSES. THE CROSS-OBJECTION NO.1 34/MDS/2015 FILED BY THE ASSESSEE IN THE CASE OF SHRI V.GURUNATHAN STAND S DISMISSED AS WITHDRAWN. ORDER PRONOUNCED IN THE OPEN COURT ON NOVEMBER 23, 2017, AT CHENNAI. SD/- SD/- ( . ) ( A. MOHAN ALANKAMONY ) ! /ACCOUNTANT MEMBER ( ) (GEORGE MATHAN) ! /JUDICIAL MEMBER /CHENNAI, 0 /DATED: NOVEMBER 23, 2017. TLN * '12 32 /COPY TO: 1. & /APPELLANT 4. 4 /CIT 2. '(& /RESPONDENT 5. 2 ' /DR 3. 4 ( ) /CIT(A) 6. /GF