Smt. Ravipati Indusree, Hyderabad V. ACIT, Hyderabad

ITA 1247/HYD/2010

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 61914 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 8 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-06-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 27-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B V PRASAD REDDY
• Assessee Lawyers: A V RAGHURAM
• Keywords: Income from undisclosed sources; Additional evidence
• Section: 143(3); 68; 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B, HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER ITA NO. 1247HYD/2010 ASSESSMENT YEAR: 2006-07 RAVIPATI INDUSREE, ASSESSEE HYDERABAD. (PAN ACIPR2847N)) VS. ASSTT. COMMISSIONER OF INCOME-TAX, RESPOND ENT CENTRAL CIRCLE 5, HYDERABAD. ASSESSEE BY : MR. A.V. RAGHURAM RESPONDENT BY : MR. B.V. PRASAD REDDY DATE OF HEARING : 09/05/2012 DATE OF PRONOUNCEMENT : 06/06 /2012 ORDER PER ASHA VIJAYARAGHAVAN, J.M.: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF THE CIT(A)-IV, HYDERABAD, PASSED ON 15/07/2010 FOR THE ASSESSMENT YEAR 2006-07. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT DURING T HE YEAR, THE ASSESSEE DERIVED INCOME FROM HOUSE PROPERTY & OTHER SOURCES. THE DETAILS AS CALLED FOR WERE FILED AND EXAMINED . DURING THE COURSE OF ASSE SSMENT PROCEEDINGS IN THE CASE OF SHRI P. KALESHWAR RAO, INDIVIDUAL THE ASSES SEE HAS GIVEN A CONFIRMATION THAT SHE HAD GIVEN CASH FOR SHARES OF SHREE PAPERS LTD., OF RS 7,50,000/- THE ABOVE PERSON. IN THE BALANCE SHEET FILED WITH THE RETURN OF INCOME IT WAS SEEN THAT THE ABOVE ADVANCE IS NOT SHOWN. THE COUNSEL O F THE ASSESSEE EXPLAINED THAT IT IS COVERED IN THE ADVANCE SHOWN AS PAID FOR LAND. ITA NO. 1247/HYD/2010 RAVIPATI INDUSREE 2 3. THE AO OBSERVED THAT IN THE BALANCE SHEET THE ASSESSEE HAS SHOWN ADVANCE FOR LAND AT RS 48 LACS BUT NO DETAILS WERE FILED AND WHEN THE ASSESSEE WAS CONFRONTED WITH THE CONFIRMATION SHE HAD GIVEN FOR RS 7.5 LACS FOR SHARES, IT WAS EXPLAINED BY THE ASSESSEE THAT IT INCLUDED I N ADVANCE FOR LAND. THE AO HELD THAT FROM THE DETAILS OF ADVANCE GIVEN FOR LAN D IT CAN BE SEEN THAT THEY ARE HASTILY MADE AND CANNOT BE RELIED AS THE DETAILS DO NOT CONTAIN ANY DATE OR ADDRESS OF PERSON TO WHOM LOANS ARE STATED TO HAVE BEEN GIVEN. THEREFORE, THE AO BEING SATISFIED THAT THE CASH OF RS 750,000/- GI VEN FOR SHARES DOES NOT FORM PART OF THE BALANCE SHEET OF THE ASSESSEE AND TREAT ED THE SAME AS INCOME FROM UNDISCLOSED SOURCES. 4. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN AP PEAL BEFORE THE CIT(A) AND THE CIT(A) CONFIRMED THE ORDER OF THE AO HOLDIN G THE SUM OF RS 750,000/- AS INCOME OF THE ASSESSEE FROM UNDISCLOSED SOURCES. 5. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US R AISING THE FOLLOWING GROUNDS OF APPEAL:- THE ASSESSMENT ORDER DATED 30.12.2008 FOR THE ASSE SSMENT YEAR 2006-07 PASSED UNDER SECTION 143(3) OF THE I.T. ACT 1961 BY THE LEARNED ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE -5 HYDER ABAD IS CONTRARY TO THE LAW AND FACTS OF THE CASE. 1. THE LEARNED ASSISTANT COMMISSIONER OF INCOME-TAX, C ENTRAL CIRCLE-5, HYDERABAD OUGHT NOT TO HAVE REJECTED THE PARTY WISE PARTICULARS FURNISHED BY ME WHEREIN THE AMOUNT OF RS 750,000 PAID TO SRI. P. KALESWARA TOWARDS ADVANCE FOR PURCHASE OF SHARES OF SREE PAPERS LIMI TED IS INCLUDED. 2. THE REASONS PUT FORTH BY LEARNED ASSISTANT COMMISSI ONER OF INCOME TAX, CENTRAL CIRCLE -5, HYDERABAD FOR REJECTING THE PART ICULARS OF ADVANCES FURNISHED BY ME ARE NOT TENABLE AND DEVOID OF MERIT S. 3. THE LEARNED ASSISTANT COMMISSIONER OF INCOME TAX, C ENTRAL CIRCLE-5, HYDERABAD OUT TO HAVE SPECIFIED THE PARTICULAR PROV ISIONS OF THE INCOME TAX ACT, 1961 UNDER WHICH THE ADDITION IS MADE AND IN THE ABSENCE THEREOF THE ADDITION MADE BY HIM WOULD BE RENDERED UNLAWFUL AND BEYOND THE PROVISIONS OF THE ACT. 4. THE LEARNED ASSISTANT COMMISSIONER OF INCOME TAX, C ENTRAL CIRCLE -5, HYDERABAD OUGHT TO HAVE CONSIDERED THE FACT THAT TH E ADVANCE OF RS 750,000/- PAID FOR PURCHASE OF SHARES IN INCLUDED I N THE TOTAL ADVANCES OF RS 48,00,000 DISCLOSED IN THE BALANCE SHEET AS AT M ARCH 31, 2006 AND HENCE IT IS NOT A CASE THAT NO ADVANCES ARE APPEARI NG IN THE BALANCE SHEET. ITA NO. 1247/HYD/2010 RAVIPATI INDUSREE 3 5. ANY OTHER GROUND THAT MAY BE URGED AT THE TIME OF H EARING OF THE PRESENT APPEAL. 6. BEFORE US, THE LEARNED COUNSEL FOR THE ASSESSEE SHRI A.V. RAGHURAM REITERATED THE SUBMISSIONS MADE BEFORE THE CIT(A) THAT ASSESSEE HAD FILED A LIST SHOWING PARTY WISE DETAILS OF ADVANCES GIVEN BY HER FOR PURCHASE OF LAND AS WELL AS SHARES BEFORE THE ASSESSING OFFICER WHICH TOTALL ED TO RS 48 LACS. HE SUBMITTED THAT DUE TO OVERSIGHT THE ADVANCE PAID TO SRI.P. KALESWARA RAO, TOWARDS PURCHASE OF SHARES HAD ALSO BEEN INCLUDED I N THE TOTAL AMOUNT OF RS 48 LACS SHOWN AS ADVANCE FOR LAND IN HER BALANCE SHEET AS ON 31.3.2006. FURTHER, THE LEARNED COUNSEL FOR THE ASSESSEE CONTENDED THA T THE ASSESSING OFFICER NEVER ASKED FOR THE PARTICULARS OF DATES AND ADDRESSES OF THE PERSONS TO WHOM SUCH ADVANCES WERE GIVEN AT ANY TIME. HE AVERRED THAT I T IS NOT THE CASE OF THE ASSESSING OFFICER THAT THERE ARE NO ADVANCES EXISTI NG IN HER BALANCE SHEET BUT THE ADDITION WAS MADE ONLY ON THE GROUND THAT THE P ARTICULARS FURNISHED BY THE ASSESSEE WERE INCOMPLETE. IT WAS ALSO SUBMITTED THA T WHILE MAKING ADDITION NEITHER THE ASSESSING OFFICER NOR THE CIT(A) SPECI FY THE PARTICULAR SECTION OF THE ACT UNDER WHICH SUCH ADDITION WAS BEING MADE. HE AV ERRED THAT THE SAID ADDITION DOES NOT FIT INTO THE PROVISIONS OF EITHER SEC 68 OR 69 AND COULD NOT HAVE BEEN MADE IN A ROUTINE MANNER. 7. IT WAS FURTHER SUBMITTED THAT ONLY LIST CONTAINI NG NAMES OF PERSONS TO WHOM THE ADVANCES WERE MADE WAS FURNISHED BEFORE TH E AO AND OTHER DETAILS WERE NOT FURNISHED AS THE ASSESSMENT WAS TIME BOUN D. IT WAS POINTED OUT BY THE LEARNED COUNSEL THAT CIT(A)-1 VIDE HIS LETTER DATED 09/10/2009 DIRECTED THE ACIT, CENTRAL CIRCLE 5, HYDERABAD TO SUBMIT A REPOR T IN RESPECT OF ADDITIONAL EVIDENCE SOUGHT TO BE ADMITTED. HOWEVER, NO REPORT HAS BEEN SUBMITTED BY THE AO AND THE APPEAL WAS DECIDED BY THE CIT(A) WITH TH E MATERIAL AVAILABLE ON RECORD. 8. THE LEARNED DR SHRI B.V. PRASAD REDDY RELIED UPO N THE ORDERS OF THE LOWER AUTHORITIES. ITA NO. 1247/HYD/2010 RAVIPATI INDUSREE 4 9. WE HAVE HEARD THE ARGUMENTS OF BOTH THE PARTIES AND PERUSED THE RECORD AS WELL AS GONE THROUGH THE ORDERS OF THE AUTHORITI ES BELOW. THOUGH THERE IS SOME MERIT IN THE ARGUMENT OF DR WHILE RELYING UPON THE ORDER OF THE CIT(A) THAT THE ASSESSEE HAS NOT BEEN ABLE TO PRODUCE ANY DOCUMENTARY EVIDENCE, ETC. SUCH AS RECEIPTS ETC. FROM SHRI P. KALESWARA RAO TO THE EFFECT THAT THE SAID AMOUNTS WERE RECEIVED FROM THE ASSESSEE FOR PURCHAS E OF SHARES ON DIFFERENT DATES IN PART SUMS, THE FACT REMAINS THAT THE AO H AS NOT GIVEN THE REMAND REPORT TILL DATE. THE ASSESSEES SUBMISSION THAT IT IS NOT THE CASE OF THE AO THAT THERE ARE NO ADVANCES EXISTING IN THE ASSESSSEES B ALANCE SHEET BUT THE ADDITION WAS MADE ONLY ON THE GROUND THAT THE PARTICULARS FU RNISHED BY THE ASSESSEE ARE IN COMPLETE. THEREFORE, IN OUR CONSIDERED OPINION, IN THE ABSENCE OF REMAND REPORT FROM THE AO IN THE INTEREST OF JUSTICE, THE ASSESSEE SHOULD GET AN OPPORTUNITY TO PRODUCE THE DETAILS OF THE ADVANCES AND HENCE, WE SET ASIDE THE ORDER OF THE CIT(A) AND RESTORE THE ISSUE TO THE FI LE OF THE AO WITH A DIRECTION TO GIVE AN OPPORTUNITY TO THE ASSESSEE AND DECIDE THE ISSUE IN ACCORDANCE WITH LAW. WHILE DOING SO, THE AO SHALL SPECIFY THE SECTI ON UNDER WHICH THE ADDITION IS MADE. 10. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 06/06/2012. SD/- SD/- (CHANDRA POOJARI) (ASHA VIJ AYARAGHAVAN) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DATED: 6 TH JUNE, 2012 KV ITA NO. 1247/HYD/2010 RAVIPATI INDUSREE 5 COPY TO:- 1) SMT. RAVIPATI INDUSREE, C/O A.V. RAGHU RAM, FLAT NO. 610, 6 TH FLOOR, BABUKHAN ESTATE, BASHEER BAGH, HYDERABAD 500 001. 2) ACIT, CENTRAL CIRCLE -5, HYDERABAD 3) THE CIT (A)-IV, HYDERABAD 4) THE CIT-III, HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYD ERABAD