Dr. Suresh Manjibhai Prajapti, Palanpur V. The ACIT, B.K.Circle, Palanpur

ITA 1357/AHD/2014

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 2003 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 6 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-11-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 27-07-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 07-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VINOD TALWANI
• Section: 143(3); 133A

Judgement Text

ITA NO. 1357/AHD/2014 DR. SURESH MANJIBHAI PRAJAPATI VS. ACIT ASSESSMENT YEAR: 2010-11 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH, AHMEDABAD [CORAM: JUSTICE P P BHATT, PRESIDENT AND PRAMOD KUM AR, VICE PRESIDENT] ITA NO. 1357/AHD/2014 ASSESSMENT YEAR: 2010-11 DR SURESH MANJIBHAI PRAJAPATI .............. ....APPELLANT DHARTI HOSPITAL, SHANTI SADAN COMPLEX, NR. PATALESHWAR TEMPLE, PALANPUR-385001 [PAN : AHBPP 9381 M] VS. ASSTT. COMMISSIONER OF INCOME-TAX ............................ RESPONDENT B K CIRCLE, PALANPUR APPEARANCES BY: ARTI N SHAH, FOR THE APPELLANT VINOD TALWANI, FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : 30.10.2018 DATE OF PRONOUNCING THE ORDER : 16.11.2018 O R D E R 1. BY WAY OF THIS APPEAL, THE ASSESSEE-APPELLANT HA S CHALLENGED CORRECTNESS OF THE ORDER DATED 3 RD MARCH 2014, PASSED BY THE LEARNED CIT(A)-XX, AHMED ABAD, IN THE MATTER OF ASSESSMENT UNDER SECTION 143(3) OF THE IN COME-TAX ACT, 1961, FOR THE ASSESSMENT YEAR 2010-11. 2. GRIEVANCES RAISED BY THE APPELLANT ARE AS FOLLOW S:- 1. THE CIT (APPEALS)-XX, AHMEDABAD HAS ERRED IN LA W AND ON FACTS OF THE CASE IN CONFIRMING THE DISALLOWANCE OF RSBY EXPENSES AND RSBY MEDICINES OF RS.20,14,867/- THOUGH SUCH EXPENSES ARE DULY SUPPOR TED BY BILLS AND VOUCHERS AND THE PAYMENT WITH REGARD THERETO HAS BEEN MADE T HROUGH CHEQUES ONLY AND THE APPELLANT HAS MAINTAINED VARIOUS PRESCRIBED REG ISTERS UNDER RULE 6F(3). 2. THE CIT (APPEALS)-XX, AHMEDABAD HAS ERRED IN LA W AND ON FACTS OF THE CASE IN CONFIRMING THE RELIANCE PLACED BY THE ASSESSING OFFICER ON STATEMENT RECORDED U/S 133A THOUGH THE SAME HAS NO EVIDENTIARY VALUE. 3. TO ADJUDICATE ON THIS APPEAL ONLY A FEW MATERIAL FACTS NEED TO BE TAKEN NOTE OF. THE ASSESSEE BEFORE US IS A MEDICAL PROFESSIONAL AN D HE HAS RENDERED SERVICES TO ITA NO. 1357/AHD/2014 DR. SURESH MANJIBHAI PRAJAPATI VS. ACIT ASSESSMENT YEAR: 2010-11 PAGE 2 OF 3 PATIENTS UNDER RASHTRIYA SWASTHYA BIMA YOJNA (RSBY) AS WELL. ON 13 TH OCTOBER 2009, HIS PREMISES WAS SUBJECTED TO SURVEY UNDER SECTION 133A, AND, DURING THIS SURVEY, HIS STATEMENT WAS ALSO RECORDED. IN RESPONSE TO ONE OF THE QUESTIONS ASKED DURING THESE PROCEEDINGS, THE ASSESSEE HAD STATED THAT OUT OF TH E RECEIPTS UNDER RSBY, THE ACTUAL EXPENDITURE IS ABOUT 30% OF GROSS RECEIPTS. HOWEVER , IN THE PROFIT AND LOSS ACCOUNTS FILED BY THE ASSESSEE ALONGWITH HIS RETURN OF INCOM E, THE ASSESSEE HAD SHOWN EXPENDITURE OF RS.35,16,770/- AS AGAINST THE GROSS RECEIPTS OF RS.50,06,343/- UNDER RSBY. ON THESE FACTS, THE ASSESSING OFFICER RESTRI CTED THE DEDUCTION OF EXPENSES TO 30% OF RECEIPTS, AND DISALLOWED THE BALANCE AMOUNT OF RS.20,14,867/-. AGGRIEVED, ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CI T(A) BUT WITHOUT ANY SUCCESS. THE ASSESSEE IS NOT SATISFIED AND IS IN FURTHER APPEAL BEFORE US. 4. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF THE AP PLICABLE LEGAL POSITION. 5. WE FIND THAT THE AUTHORITIES BELOW HAVE REJECTED THE DETAILS OF EXPENSES, AND EVIDENCES IN SUPPORT THEREOF, MERELY ON THE GROUND THAT THE ASSESSEE HIMSELF HAD ACCEPTED THAT EXPENDITURE INCURRED UNDER RSBY IS ON LY 30% OF RECEIPTS. THIS APPROACH IS FALLACIOUS AND UNTENABLE IN LAW FOR SEVERAL REAS ONS. IT IS ONLY ELEMENTARY THAT A STATEMENT RECORDED UNDER SECTION 133A HAS NO EVIDEN TIARY VALUE. HONBLE MADRAS HIGH COURT HAS HELD SO IN THE CASE OF CIT VS. S KHADER K HAN SON [(2008) 300 ITR 157 (MAD)] AND HONBLE SUPREME COURT HAS, VIDE JUDGMENT REPORTED AS CIT VS. KHADER KHAN SON [(2012) 254 CTR 228 (SC)], HAS DISMISSED A PPEAL AGAINST THE SAME. IN ANY EVENT, WHAT WAS STATED BY THE ASSESSEE WAS ONLY EST IMATED EXPENDITURE AGAINST RSBY RECEIPTS BUT THEN IT IS NOT REALLY NECESSARY THAT E NTIRE EXPENDITURE MUST BE INCURRED IN THE SAME PERIOD IN WHICH RECEIPTS ARE ACCOUNTED, AN D THEREFORE WHEREVER CASH METHOD OF ACCOUNTING IS FOLLOWED AS IN THIS CASE, THE DI RECT CORRELATION BETWEEN THE PROFIT AND LOSS ACCOUNT INCOME AND EXPENDITURE FIGURES IS NOT ALWAYS NECESSARY. WHAT IS ALSO IMPORTANT IS THAT WHEN ASSESSEE MAKES A CLAIM FOR E XPENDITURE, IT CANNOT BE SUMMARILY DISMISSED, WITHOUT EVEN LOOKING AT THE SUPPORTING E VIDENCES, BY ADOPTING SOME ESTIMATION ON WHATEVER BASIS. THE AUTHORITIES BELO W WERE THUS UNJUSTIFIED IN REJECTING THE CLAIM OF DEDUCTION AT ACTUALS, ON THE BASIS OF SURMISES AND CONJECTURES. SUCH AN ACTION CANNOT MEET ANY JUDICIAL APPROVAL. ITA NO. 1357/AHD/2014 DR. SURESH MANJIBHAI PRAJAPATI VS. ACIT ASSESSMENT YEAR: 2010-11 PAGE 3 OF 3 6. IN VIEW OF THE ABOVE DISCUSSIONS, AS ALSO BEARIN G IN MIND ENTIRETY OF THE CASE, WE DIRECT THE ASSESSING OFFICER TO DELETE THE IMPUGNED DISALLOWANCE OF RS.20,14,867/-. THE ASSESSEE GETS THE RELIEF ACCORDINGLY. 7. IN THE RESULT, THE APPEAL IS ALLOWED. PRONOUNCE D IN THE OPEN COURT TODAY ON THE 16 TH NOVEMBER, 2018 SD/- SD/- JUSTICE P P BHATT PRAMOD KUMAR (PRESIDENT) (VICE PRESIDENT) AHMEDABAD, THE 16 TH DAY OF NOVEMBER, 2018 **BT COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD 1. DATE OF DICTATION: .......4 PAGES MANUSCRIPTS O F HONBLE VP ATTACHED 08.11.2018... 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE T HE DICTATING MEMBER: .. 11.11.2018..... 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR . P.S./P.S.: 16.11.2018... 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE TH E DICTATING MEMBER FOR PRONOUNCEMENT: .. 16.11.2018. 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK : . 16.11.2018. 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK : . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER : . 8. DATE OF DESPATCH OF THE ORDER: ......