ACIT, Pune V. Dr. Umesh Ankush Phalke, Pune

ITA 1277/PUN/2012

• Counselvise Citation: 127724514 RSA 2012
• Duration Of Justice: 1 year(s) 3 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-09-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 19-09-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 11-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Onus to prove

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER AND SHRI R.K. PANDA, ACCOUNTANT MEMBER ITA NO. 1277/PN/2012 (ASSESSMENT YEAR 2008-09) ASST. CIT, CIRCLE-9, PUNE .. APPELLANT VS. DR. UMESH ANKUSH PHALKE, C/O. KADAM KRISHNA S. SARATHI, VIVEKNAGAR, AKURDI, PUNE 411035 PAN NO. AKCPP9310L .. RESPONDENT APPELLANT BY : SHRI RAJESH DAMOR RESPONDENT BY : NONE DATE OF HEARING : 19-09-2013 DATE OF PRONOUNCEMENT : 24-09-2013 ORDER PER R.K. PANDA, AM : THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER DATED 22-03-2012 OF THE CIT(A)-V, PUNE RELATING TO ASSESSMENT YEAR 2008-09. 2. DESPITE SERVICE OF NOTICE NONE APPEARED ON BEHAL F OF THE ASSESSEE. HENCE, THIS APPEAL IS BEING DECIDED ON THE BASIS OF MATERIAL AVAILABLE ON RECORD AND AFTER HEARING THE LD. DEPARTMENTAL REPRE SENTATIVE. 3. GROUNDS OF APPEAL NO. 1 TO 3 BY THE REVENUE READ AS UNDER : 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD. CIT(A) WAS JUSTIFIED IN ALLOWING RS.8, 49,081/- OUT OF TOTAL DISALLOWANCE OF RS.11,49,081/- MADE OUT OF AG RICULTURAL INCOME, MERELY BECAUSE IN THE 7/12 EXTRACT THERE IS A MENTION OF AGRICULTURAL OPERATION BEING CARRIED OUT. 2 2. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) WAS JUSTIFIED IN ALLOWING THE A BOVE AMOUNTS OF RS.8,49,081/- AS AGRICULTURAL INCOME WHEN THE CIT(A ) HIMSELF HELD THAT 'BUT THE APPELLANT HAS FAILED TO PRODUCE ANY D ETAILS REGARDING EXPENDITURE RELATING TO AGRICULTURAL OPERATIONS'. 3. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) WAS JUSTIFIED IN ALLOWING THE A BOVE AMOUNT OF RS.8,49,081/- AS AGRICULTURE INCOME INSPITE OF HOLD ING THAT 'THE ALLOCATION WHICH HAS BEEN MARKED AS ANNEXURE-II IS NOTHING BUT AN AFTERTHOUGHT AND THE AUTHENTICITY OF THE SAME CA NNOT BE ACCEPTED'. 3.1 FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSES SEE IS A NEURO SURGEON AND CONSULTANT DOCTOR. HE FILED HIS RETURN OF INCO ME ON 29-09-2008 DECLARING TOTAL INCOME OF RS.19,66,580/-. DURING T HE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAS SHOWN AGRICULTURAL INCOME OF RS.11,49,081/-. ON PE RUSAL OF THE BALANCE SHEET FOR LAST 3 YEARS THE ASSESSING OFFICER NOTED THAT THERE IS NO AGRICULTURAL LAND HOLDING IN THE NAME OF THE ASSESS EE FOR ANY OF THESE YEARS. STILL THE ASSESSEE IS REGULARLY SHOWING AGR ICULTURAL INCOME YEAR AFTER YEAR AS UNDER : ASSESSMENT YEAR AGRICULTURAL INCOME RS. 2006-07 6,90,984/- 2007-08 9,38,940/- 2008-09 11,49,081/- 3.2 THE ASSESSING OFFICER THEREFORE ASKED THE ASSES SEE TO EXPLAIN THE BASIS OF SHOWING SUCH AGRICULTURAL INCOME WHEN HE D OES NOT HOLD ANY AGRICULTURAL LAND. IT WAS EXPLAINED BY THE ASSESSE E THAT THE SAID INCOME WAS RECEIVED FROM HIS NATIVE VILLAGE BARGEWADI WHER E THE AGRICULTURE IS ACTUALLY BEING CARRIED OUT ON HIS BEHALF. SINCE TH E ASSESSEE COULD NOT 3 SUBSTANTIATE THE CLAIM WITH ANY PROOF OF EXPENSES F OR AGRICULTURE DONE THE ASSESSING OFFICER DISBELIEVED THE CLAIM OF THE ASSESSEE. IT WAS EXPLAINED BY THE ASSESSEE THAT THOUGH THE LAND SHAR E WAS ALLOTTED TO THE ASSESSEE ON PARTITION OF HUF, ON PAPER, THERE IS NO AGRICULTURAL LAND IN THE NAME OF THE ASSESSEE AND THEREFORE NO AGRICULTU RAL LAND WAS SHOWN IN THE BALANCE SHEET. REJECTING THE VARIOUS EXPLANATI ONS GIVEN BY THE ASSESSEE AND OBSERVING THAT THE ASSESSEE COULD NOT DISCHARGE THE ONUS OF ESTABLISHING THE GENUINENESS OF SUCH AGRICULTURAL I NCOME, THE ASSESSING OFFICER MADE ADDITION OF RS.11,49,081/- BY DISALLOW ING THE AGRICULTURAL INCOME SHOWN BY THE ASSESSEE. 4. BEFORE THE CIT(A) IT WAS SUBMITTED THAT THIS AGR ICULTURAL INCOME WAS WRONGLY SHOWN BY THE ASSESSEE WHEREAS THE SAME ACTUALLY PERTAINS TO PART OF HUF AGRICULTURAL INCOME. IT WAS ONLY TH E SHARE WHICH THE ASSESSEE HAS RECEIVED FROM THE HUF. IT WAS SUBMITT ED THAT THE FACT OF AGRICULTURAL ACTIVITY BEING CARRIED OUT IN THE SAID LAND WHICH WAS RECEIVED ON ACCOUNT OF PARTITION OF HUF IN 2001 AFTER THE DE MISE OF HIS FATHER IS EVIDENT FROM 7/12 EXTRACT PERTAINING TO THE SAID LA ND. IT WAS SUBMITTED THAT THE LAND WAS FERTILE AND THE NET AGRICULTURAL INCOME OF THE FAMILY WAS RS.20 LAKHS ON 3.9 HECTARES OF LAND. THE ASSESSEE ALSO FILED DATE-WISE ANALYSIS OF THE AGRICULTURAL INCOME. 5. BASED ON THE ARGUMENTS ADVANCED BY THE ASSESSEE THE LD.CIT(A) DETERMINED THE SHARE OF AGRICULTURAL INCOME OF THE ASSESSEE AT RS.3 LAKHS AND SUSTAINED DISALLOWANCE TO THE TUNE OF RS.8,49,0 81/- AS AGAINST RS.11,49,081/- DISALLOWED BY THE ASSESSING OFFICER BY HOLDING AS UNDER: 4 13. AFTER CAREFULLY CONSIDERING THE REPLY OF THE A PPELLANT AS WELL AS FACTS OF THE CASE, IT IS SEEN THAT THERE ARE SO MANY CONTRADICTIONS IN THE VERSION OF THE APPELLANT REGA RDING AGRICULTURE INCOME. WHILE IN THE RETURN OF INCOME, THE AMOUNT OF RS.11,49,081/- HAS BEEN SHOWN AS AGRICULTURAL INCOM E AND WHEN THE APPELLANT WAS CONFRONTED DURING THE COURSE OF A SSESSMENT PROCEEDINGS, THE APPELLANT CAME OUT WITH ANOTHER TH EORY THAT IT WAS PART OF HUF AGRICULTURAL INCOME, WHICH HE HAS R ECEIVED AS A MEMBER OF HUF. THE APPELLANT ALSO SUBMITTED THAT HU F LAND WAS PARTITIONED IN 2001 BUT MUTATION WAS NOT DONE AND, THEREFORE, THE APPELLANT'S NAME WAS NOT ENTERED IN THE LAND REVENU E RECORDS. IF THIS IS THE CASE THEN THE INCOME FROM THE AGRICULTU RAL LAND CANNOT BE SAID TO BE SHARE OF HUF AS HUF LAND HAD BEEN PAR TITIONED WAY BACK IN 2001. THEREFORE, LAND HAS TO BE TREATE D AS APPELLANTS LAND IRRESPECTIVE OF THE FACT THAT REVE NUE RECORDS WERE UPDATED OR NOT. THEREAFTER, THE QUESTION REMAINS AS TO WHETHER AGRICULTURAL OPERATION WAS CARRIED OUT IN THE LAND OR NOT AND IN CASE THE AGRICULTURAL OPERATION WAS CARRIED OUT, WH AT COULD BE THE REASONABLE INCOME FROM THE SAID LAND. FROM THE 7/1 2 EXTRACT, IT CAN BE SEEN THAT THE RECORDS DO SHOW CULTIVATION OF CROPS. BUT THE APPELLANT HAS FAILED TO PRODUCE ANY DETAILS REGARDI NG EXPENDITURE RELATING TO AGRICULTURAL OPERATIONS. IT CAN BE SEEN THAT AGRICULTURAL ACTIVITY HAS BEEN CLAIMED TO BE CARRIED OUT BY THE BROTHER OF THE APPELLANT WHO STAYS IN THE VILLAGE BUT THE ALLOCATI ON OF AGRICULTURAL INCOME AS STATED IN ANNEXURE-II CANNOT BE SAID TO BE PROPER. IN THE AGRICULTURAL LAND, THERE ARE 3 STAK E HOLDERS, THE APPELLANT, HIS MOTHER AND HIS BROTHER AND THEREFORE , IT IS IMPERATIVE THAT THE EXPENSES AND RECEIPTS RELATING TO AGRICULTURAL OPERATIONS ARE RECORDED PROPERLY AND NET INCOME IS APPORTIONED THEREON AMONGST 3 STAKE HOLDERS. FROM THE ANALYSIS OF AGRICULTURAL INCOME, IT IS SENT THAT THE ONLY SHARE ALLOTTED TO THE APPELLANT HAS BEEN SHOWN AND THERE IS NO REFERENCE TO ALLOTMENT OF INCOME IN RESPECT OF APPELLANT'S MOTHER AS WELL AS HIS BROTHER. THEREFORE, THIS ALLOCATION WHICH HAS BEEN MARKED AS ANNEXURE-II IS NOTHING BUT AN AFTERTHOUGHT AND THE AUTHENTICITY OF THE SAME CANNOT BE ACCEPTED. HOWEVER, CONSIDERING THE FACT T HAT IN 7/12 EXTRACT RECORDS, THERE IS MENTION OF AGRICULTURAL O PERATION BEING CARRIED OUT, IT CANNOT BE SAID THAT NO AGRICULTURAL OPERATIONS WERE CARRIED OUT. THEREFORE TO MEET THE ENDS OF JUSTICE, IT WILL BE REASONABLE TO ESTIMATE THE APPELLANT'S SHARE OF AGR ICULTURAL INCOME AT RS.3 LAKHS. ACCORDINGLY, RELIEF IS ALLOWE D AT RS.3 LAKHS AND THE BALANCE AMOUNT OF RS.8,49,081/- IS CONFIRME D. ACCORDINGLY, THE GROUND IS TREATED AS PARTLY ALLOWE D. 5 5.1 AGGRIEVED WITH SUCH ORDER OF THE CIT(A) THE REV ENUE IS IN APPEAL BEFORE US. 6. WE HAVE CONSIDERED THE ARGUMENTS OF THE LD. DEPA RTMENTAL REPRESENTATIVE AND PERUSED THE ORDERS OF THE ASSESS ING OFFICER AND THE CIT(A). THE LD. DEPARTMENTAL REPRESENTATIVE COULD NOT CONTROVERT THE FINDINGS GIVEN BY THE LD.CIT(A) THAT THE 7/12 EXTRA CT SHOW CULTIVATION OF CROPS. IN OUR OPINION, THE ORDER OF THE CIT(A) ON THIS ISSUE WHICH HAS ALREADY BEEN REPRODUCED IN THE PRECEDING PARAS IS A REASONED ONE WHICH REQUIRES NO INTERFERENCE FROM OUR SIDE. FURTHER, W E FIND ALTHOUGH THE CIT(A) HAD GIVEN RELIEF OF RS.3 LAKHS AND SUSTAINED ADDITION OF RS.8,49,081/- THE REVENUE HAS TAKEN THE GROUNDS CHA LLENGING THE RELIEF OF RS.8,49,081/-. GROUNDS RAISED BY THE REVENUE AR E ACCORDINGLY DISMISSED. 7. GROUNDS OF APPEAL NO.4 AND 5 BY THE REVENUE READ AS UNDER : 4. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD. CIT(A) WAS JUSTIFIED IN DELETING THE D ISALLOWANCE OF RS.2,90,402/- WHERE SELF MADE VOUCHERS WERE MADE AV AILABLE, WHEN THE ONUS TO PROVE THE GENUINENESS OF THE EXPEN SES WAS NOT DISCHARGED BY THE ASSESSEE INSPITE OF SEVERAL OPPOR TUNITIES ALLOWED BY THE A.O. 5. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) WAS JUSTIFIED IN DELETING THE D ISALLOWANCE OF RS.5,00,649/- MADE ON ACCOUNT OF MEDICAL AND SURGIC AL EQUIPMENTS, WHEN THE ONUS TO PROVE THE GENUINENESS OF THE EXPENSES WAS NOT DISCHARGED BY THE ASSESSEE INSPITE OF SEVERAL OPPORTUNITIES ALLOWED BY THE AO. 7.1 FACTS OF THE CASE, IN BRIEF, ARE THAT THE AO DU RING THE COURSE OF ASSESSMENT PROCEEDINGS NOTED THAT OUT OF TOTAL PROF ESSIONAL FEES RECEIPT OF RS.41,51,734/-, THE ASSESSEE HAS RECEIVED RS.39, 63,646/- FROM VARIOUS 6 HOSPITALS LEAVING THE BALANCE OF RS.1,88,088/- PROB ABLY RECEIVED OUT OF HIS OWN OPD/OPP CLINIC. THE ASSESSING OFFICER FURTH ER OBSERVED THAT AGAINST THIS INCOME THE ASSESSEE HAS CLAIMED EXPENSES OF RS.21,83,592/. THE ASSESSING OFFICER ANALYSED THE EXPENSES AND FOU ND THAT OUT OF TOTAL EXPENDITURE OF RS.21,83,592/-, VOUCHERS AND BILLS W ERE AVAILABLE FOR RS.13,38,776/- WHILE IN RESPECT OF RS.2,90,402/- SE LF MADE VOUCHERS WERE AVAILABLE. THE ASSESSING OFFICER FURTHER NOTIC ED THAT THERE WERE NO VOUCHERS WHATSOEVER IN RESPECT OF THE BALANCE RS.5, 54,413/-. THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAS SHO WN MEDICAL AND SURGICAL PURCHASES WHICH DO NOT JUSTIFY IN VIEW OF THE FACT THAT MAJOR PORTION OF HIS RECEIPT HAS BEEN SHOWN AS RECEIVED F ROM VARIOUS HOSPITALS. AFTER ANALYZING THE ISSUE, THE ASSESSING OFFICER ADDED THE FOLLOWING AMOUNTS: 1. MEDICAL PURCHASES RS.4,94,246/- 2. SURGICAL PURCHASE RS.6,403/- ------------------ TOTAL RS.5,00,649/- ----------------- 7.2 THEREAFTER, HE FURTHER DISALLOWED THE AMOUNT OF RS.2,90,402/- FOR WHICH ONLY SELF MADE VOUCHERS WER E AVAILABLE ALONG WITH AMOUNT OF RS.5,54,413/- FOR WHICH NO VOUCHERS WERE AVAILABLE MAKING TOTAL ADDITION OF RS.13,45,463/- (5,00.649/- + 5,54,413/-). 8. BEFORE CIT(A) IT WAS SUBMITTED THAT ASSESSEE IS A NEUROSURGEON AND DEALS WITH ACCIDENT AND TRAUMA CASES. FOR THE T REATMENT OF PATIENTS IN TIME, IT IS IMPERATIVE THAT EMERGENCY KIT IS REA DY, WHICH IS CARRIED BY THE DOCTOR WITH HIM AND USED FOR IMMEDIATE TREATMEN T. IT WAS SUBMITTED THAT DUE TO EMERGENCY NATURE OF THE JOB, IT WAS NOT POSSIBLE FOR HIM TO 7 PRESERVE THE BILLS FOR EACH AND EVERY PURCHASE AS T IME IS ESSENCE IN TREATING THE TRAUMA PATIENTS. HE ALSO SUBMITTED THAT MAJORIT Y OF THE PURCHASES WERE MADE FROM LOKMANYA MEDICAL STORES SI TUATED AT LOKMANYA HOSPITAL. IT WAS FURTHER SUBMITTED THAT DUE TO ABSENCE OF PROPER ACCOUNTANT, THE ASSESSEE COULD NOT MAINTAIN AND KEEP THE BILLS IN PROPER MANNER AND THEREFORE, IT WAS NOT POSSIBLE TO PRODUCE BILLS AND VOUCHERS IN RESPECT OF EACH AND EVERY PURCHASE. 9. IN APPEAL THE LD.CIT(A) SUSTAINED AN AMOUNT OF R S.5,54,413/- FOR WANT OF DETAILS. HE, HOWEVER, DELETED THE ADDITION OF RS.2,90,402/- AND RS.5,00,649/- RESPECTIVELY BY OBSERVING AS UNDER : 10. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . HOWEVER, THE DISALLOWANCE OF RS.2,90,402/- ON ACCOU NT OF SELF MADE VOUCHERS CANNOT BE SUSTAINED CONSIDERING THE B ACKGROUND OF THE APPELLANT AS WELL AS CONSIDERING THE EMERGENCY NATURE OF HIS JOB. THE ASSESSING OFFICER HAS ALSO M ADE ADDITION OF RS.4,94,246/- AS WELL AS RS.6,403/- ON ACCOUNT OF M EDICAL AND SURGICAL EQUIPMENTS TAKING A VIEW THAT THE USE OF T HE SAME IN VARIOUS HOSPITALS COULD NOT BE CONFIRMED BY THE APP ELLANT. THIS VIEW OF THE ASSESSING OFFICER APPEARS TO APPEARS TO BE UNREALISTIC IN VIEW OF THE FACT THAT CERTAIN SURGICAL EQUIPMEN TS ARE REQUIRED TO BE CARRIED BY THE DOCTOR IN HIS TOOL-KIT IRRESPE CTIVE OF THE FACT WHETHER THE SAME ARE USED OR NOT. IT IS NOT THE CA SE OF THE ASSESSING OFFICER THAT PURCHASE IN RESPECT OF ITS M EDICAL AND SURGICAL EQUIPMENTS ARE BOGUS. THEREFORE, DISALLOWA NCE OF RS.4,94,246/- AND RS.6,403/- ON ACCOUNT OF MEDICAL AND SURGICAL PURCHASE CANNOT BE SUSTAINED. ACCORDINGLY, THE ADD ITION IS RESTRICTED TO RS.5,54,413/- AND THE GROUNDS ARE TRE ATED AS PARTLY ALLOWED. 9.1 AGGRIEVED WITH SUCH ORDER OF THE CIT(A) THE REV ENUE IS IN APPEAL BEFORE US. 8 10. WE HAVE HEARD THE LD. DEPARTMENTAL REPRESENTATI VE AND PERUSED THE ORDERS OF THE AO AND THE CIT(A). THERE IS NO DISPUTE TO THE FACT THAT THE ASSESSEE IS A BUSY DOCTOR HANDLING TRAUMA CASES. WE FIND MERIT IN THE OBSERVATIONS OF THE LD.CIT(A) THAT CERTAIN S URGICAL EQUIPMENTS ARE REQUIRED TO BE CARRIED OUT BY THE DOCTOR IN HIS TO OL KIT IRRESPECTIVE OF THE FACT WHETHER THE SAME ARE USED OR NOT. IN OUR OPI NION, KEEPING METICULOUS DETAILS OF BILLS AND VOUCHERS FOR MEDICA L/SURGICAL EQUIPMENTS FOR A DOCTOR LIKE IN THE PRESENT CASE IS NOT POSSIB LE SINCE TIME IS ESSENCE FOR SAVING THE LIVES OF PATIENTS. SINCE THE ORDER O F THE CIT(A) ON THESE 2 ISSUES APPEAR TO BE REASONABLE AND JUSTIFIED UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE, THEREFORE, THE SAME IN O UR OPINION REQUIRES NO INTERFERENCE FROM OUR SIDE. WE ACCORDINGLY UPHOLD THE SAME. GROUNDS RAISED BY THE REVENUE ARE ACCORDINGLY DISMISSED. 11. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON THIS THE 24 TH DAY OF SEPTEMBER 2013 SD/- SD/- (SHAILENDRA KUMAR YADAV) (R.K. PAN DA) JUDICIAL MEMBER ACCOUNT ANT MEMBER PUNE DATED: 24 TH SEPTEMBER 2013 SATISH COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE 2. DEPARTMENT 3. CIT(A)-V, PUNE 4 CIT-V, PUNE 5. THE D.R, B PUNE BENCH 6. GUARD FILE BY ORDER // TRUE COPY // SENIOR PRIVATE SECRETARY ITAT, PUNE BENCHES, PUNE