Chakrapani Appanaboina, Hyderabad, Hyderabad V. ITO, Ward-7(1), Hyd, Hyderabad

ITA 1395/HYD/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 2579 (ITAT-HYDERABAD)
• Duration Of Justice: 11 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-09-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 17-10-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: L R AMJI RAO
• Assessee Lawyers: N MOHAN KUMAR
• Keywords: Salary income

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD SMC - B BENCH : HYDERABAD BEFORE SHRI D. MANMOHAN, VICE PRESIDENT ITA.NO. 1395/H/2016 ASSESSMENT YEAR 2008 - 2009 CHAKRAPANI APPANABOINA, HYDERABAD. PAN: ADGPA9217L VS. ITO, WARD - 7(1), HYDERABAD. (APPELLANT) (RESPONDENT) FOR ASSESSEE: SHRI N. MOHAN KUMAR FOR REVENUE : SHRI L RAMJI RAO, CIT - DR DATE OF HEARING : 20 .09.2017 DATE OF PRONOUNCEMENT : 22 .09.2017 ORDER PER D. MANMOHAN, VP. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY LD. CIT(A) - 10, HYDERABAD AND IT PERTAINS TO ASSESSMENT YEAR 2008 - 2009. 2. ASSESSEE RAISED THE FOLLOWING GROUNDS OF APPEAL BEFORE THE TRIBUNAL: 1. THE ORDER OF THE LD. CIT(A) IS BAD IN LAW AND ON FACTS. 2. THE LD. CIT(A) ERRED IN DISPOSING OF THE APPEAL WITHOUT ADJUDICATING ON THE FOLLOWING ISSUES: - (I) W HETHER THE REMUNERATION RECEIVED BY THE APPELLANT AS THE PRESIDING OFFICER OF ANDHRA PRADESH LEGISLATIVE COUNCIL IS INCOME FROM SALARIES AS CLAIMED BY THE APPELLANT OR INCOME FROM OTHER SOURCES AS PER THE ASSESSMENT ORDER AND (II) WHETHER THE SALARIES OF THE APPELLANTS OFFICE SUBORDINATES, VIZ., RS. 81,900/ - REIMBURSED TO THE APPELLANT IS AN OFFICE EXPENSE AS CLAIMED BY THE APPELLANT OR INCOME TAXABLE IN HIS HANDS A S PER THE ASSESSMENT ORDER. 3. IN VIEW OF THE AFORESAID GROUNDS INCLUDING ANY OTHER GROUND OR GROUNDS THAT MAY BE RAISED AT THE TIME OF HEARING, IT IS HUMBLY PRAYED THAT THE ISSUES AS AFORESAID MAY BE ADJUDICATED AND THE ADDITION OF RS. 81,900/ - WRONGLY MA DE BY THE ASSESSING OFFICER BE DELETED IN THE INTEREST OF JUSTICE. 2 3. THE MAIN ISSUE FOR CONSIDERATION IS WHETHER THE REMUNERATION RECEIVED BY THE ASSESSEE, IN HIS CAPACITY AS CHAIRMAN OF THE AN DHRA PRADESH LEGISLATIVE COUNCIL , IS ASSESSABLE TO TAX UNDER THE HEAD SALARIES AND WHETHER CERTAIN EXPENDITURE REIMBURSED TO THE ASSESSEE IS TO BE INCLUDED AS PART OF THE SALARY. FACTS NECESSARY FOR THE DISPOSAL OF APPEAL ARE STATED IN BRIEF. FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE DECLARED TOTAL INCOME OF RS.7,91,200/ - . RETURN WAS SELECTED FOR SCRUTINY UNDER CASS. DURING THE COURSE OF EXAMINATION OF THE RETURN, THE A.O. NOTICED THAT THE ASSESSEE HAD DEC LARED SALARY INCOME OF RS. 7,71,700/ - AND INTEREST INCOME ON FD OF RS. 19,500/ - AND INCOME TAX RETURN WAS FILED ALONG WITH FORM NO.16. THE ASSESSING OFFICER CALLED FOR BIFURCATION OF THE SALARY. IN RESPONSE THEREOF, IT WAS STATED THAT HONORARIUM TO THE TUNE OF RS. 6,69,347/ - WAS RECEIVED AND TH E BALANCE OF DETAILS WAS GIVEN AS UNDE R: ARREARS OF HRA (CREDITED ON 4.4.2008) RS. 1,05,000/ - REIMBURSEMENT OF OFFICIAL TELEPHONE EXPENSES RS. 5,104/ - REIMBURSEMENT OF OFFICIAL TRAVELLING EXPENSES RS. 3,69.762/ - FURNITURE & FITTINGS AT CAMP OFFICE RS. 4,50,000/ - INTEREST EARNED ON SB A /C RS. 6,601/ - 4. THE A.O. OBSERVED THAT THE ASSESSEE CANNOT BE CONSIDERED AS AN EMPLOYEE OF THE GOVERNMENT SINCE HE IS AN ELECTED REPRESENTATIVE OF THE PEOPLE AND HENCE THE AMOUNT RECEIVED BY HIM SHOULD NOT BE CONSIDERED UNDER THE HEAD SALARY. IN THIS REGARD , HE REFERRED TO THE CIRCULAR ISSUED BY THE CBDT DATED 22.05.1967 . HE WAS THEREFORE OF THE VIEW THAT THE AMOUNT RECEIVED BY THE ASSESSEE IS TAXABLE UNDER THE HEAD INCOME FROM OTHER SOURCES. 5. THE ASSESSEES AR SUBMITTED THAT THE ASSESSEES CASE IS COVERED UNDER THE PROVISIONS OF SECTION 195A OF THE ACT. IN OTHER WORDS, THE TAX C HARGEABLE ON THE INCOME RECEIVED BY THE ASSESSEE IS TO BE BORNE BY THE GOVERNMENT . ACCORDING TO THE A.O., THE INCOME SHOULD BE INCREASED TO THE EXTENT OF TAX PAID BY THE GOVERNMENT ON BEHALF OF THE ASSESSEE. THE ASSESSMENT WAS ACCORDINGLY COMPLETED ON A TOTAL INCOME OF RS. 18,18,567/ - . 6. AGGRIEVED, ASSESSEE CONTENDED BEFORE THE LD. CIT(A) THAT THE AMOUNTS REIMBURSED BY THE GOVERNMENT , WHICH ARE INCURRED FOR FURNISHING THE CAMP OFFICE , SHOULD NOT BE TREATED AS FORMING PART OF SALARY INCOME AS THE SAME IS EXEMPT. IN 3 OTHER WORDS, A SUM OF RS. 4,50,000/ - REIMBURSE D BY GAD IS NOT LIABLE TO BE TAXED. ASSESSEE FILED MODIFIED GROUNDS OF APPEAL WHEREIN IT WAS CO NTENDED THAT THE A.O. ERRED IN ASSESSING THE HONORARIUM UNDER THE HEAD INCOME FROM OTHER SOURCES OVERLOOKING THE FACT THAT IT WAS RECEIVED FOR SERVICES RENDERED BY THE ASSESSEE AND HENCE ASSESSABLE UNDER THE HEAD SALARY. IT WAS ALSO SUBMITTED THAT THE A.O. ERRED IN TREATING THE ENTIRE SUM OF RS. 3 LAKHS AS HIS INCOME, WHICH WAS SANCTIONED TO THE ASSESSEE BY THE GOVERNMENT FOR ACQUIRING FU RNITURE AND FIXTURE S AT HIS RESIDENCE, OVERLOOKING THE FACT THAT THE SAME IS RETURNABLE AT THE TIME OF DEMITTING OFFICE. AT BEST, THE SAME IS ASSESSABLE UNDER THE HEAD PERQUISITE AND 10% THEREOF OUGHT TO HAVE BEEN ASSESSED. IT WAS ALSO SUBMITTED THAT T HE A.O. ERRED IN TREATING A SUM OF RS. 81,900/ - , REPRESENTING SALARIES OF SUBORDINATES, AS INCOME OF THE ASSESSEE. HERE ALSO IT WAS CONTENDED THAT THE SALARY TO THE SUBORDINATES CAN BE TREATED AS PERQUISITE AND 10% THEREOF OUGHT TO HAVE BEEN CHARGED. G ROSSING UP OF INCOME @ 30% INSTEAD OF RATE S APPLICABLE IN ACCORDANCE WITH SECTION 195A OF THE ACT WAS ALSO CHALLENGED BEFORE THE LD. CIT(A) AND THUS CONTENDED THAT AN ADDITION OF RS. 3,81,900/ - WAS WRONGLY MADE BY THE ASSESSING OFFICER. IT WAS ALSO SPECIF IED THAT THE ASSESSEE HAS WRONGLY MENTIONED THE COST OF FURNITURE AT RS. 4,50,000/ - AS AGAINST RS. 3 LAKHS. 7 . BEFORE THE LD. CIT(A) IT WAS CONTENDED THAT THE ASSESSEE IS THE CHAIRMAN OF ANDHRA PRADESH LEGISLATIVE COUNCIL . DURING THE PREVIOUS YEAR RELEVAN T TO THE ASSESSM ENT YEAR UNDER CONSIDERATION THE HONORARIUM PAID TO THE ASSESSEE WAS SUPPORTED BY SALARY CERTIFICATE DATED 28.06.2008. IT WAS ALSO CONTENDED THAT THE ASSESSEE HOLDS A CONSTITUTIONAL OFFICE AND ENJOYS A TAX FREE SALARY INCOME WHICH WAS WRON GLY GROSSED UP U/S 195A OF THE ACT ON THE GROUND THAT THE INCOME TAX WAS DIRECTLY PAID BY THE GAD OF ANDHRA PRADESH. THERE WAS A DEFECT IN FORM NO.16 ORIGINALLY ISSUED AND A REVISED FORM NO.16 DATED 26.02.2011 WAS ISSUED TO HIM AFTER RECTIFYING A MISTAKE. STILL SOME ERRORS , WHICH WERE NOT RECTIFIED , SUBSIST IN FORM NO.16. FOR INSTANCE, THE SAL ARY INCOME WAS SHOWN AT RS. 7,70 ,100/ - BEFORE TAKING PERQUISITES INTO ACCOUNT WHEREAS THE SAID AMOUNT CON SISTS OF SUBORDINATE S SALARIES AMOUNTING TO RS. 81,900/ - AND THUS THE NET SALARY WAS ONLY RS. 6,88,200/ - , THE BREAKUP OF WHICH IS HO NORARIUM OF RS. 5,83,200/ - AND HRA ARREARS AMOUNTING TO RS. 1,05,000/ - . 8 . IT WAS ALSO SUBMITTED THAT THE ASSESSEE WAS SANCTIONED A SUM OF RS. 3 LAKHS BY THE GOVERNMENT OF ANDHRA PRADESH FOR PURCHASE OF FURNITURE AT HIS OFFICIAL RESIDENCE 4 WHICH IS RETURNABLE AT THE TIME OF DEMITTING OFFICE AND AT BEST 10% OF THE SAME I.E., RS. 30,000/ - IS ASSESSABLE TO TAX AS PERQUISITE. IT WAS STATED THAT THE ASS ESSEE HAS ALREADY OFFERED A SUM OF RS. 30,000/ - AS PERQUISITE . SIMILAR CONTENTION WAS RAISED WITH REGARD TO THE SALARIES PAID TO SU BORDINATE STAFF. IT WAS ALSO STATED THAT A FURTHER SUM OF RS. 1,50,000/ - WAS SANCTIONED / REIMBURSED BY THE STATE GOVERNM ENT FO R PURCHASE OF SOME GOODS LIKE CURTAINS, CROCKERY ETC., WHICH NEED NOT BE RETURNED AT THE TIME OF DEMITTING OFFICE AND THEREFORE, IT WAS ALREADY OFFERED TO TAX BY THE ASSESSEE. ACCORDING TO THE ASSESSEE, THE A.O. ERRED IN ADDING SUBORDINATES SALARIE S AND THE COST OF FURNITURE AND FITTINGS AS INCOME OF THE ASSESSEE. 9 . WITH REGARD TO THE BOARD CIRCULAR DATED 22.05.1967 IT WAS CLARIFIED THAT THE CBDT WAS CONCERNED WITH THE AMOUNT RECEIVABLE BY MEMBERS OF PARLIAMENT SINCE THEY ARE ELECTED REPRESENTATIVES AND THEY ARE NOT EMPLOYEES OF THE GOVERNMENT WHEREAS THE CIRCULAR HAS NO APPLICATION TO THE MLCS AND IN PARTICULAR THE AMOUNT RECEIVED IN THE FORM OF HONORARIUM BY A CHAIRMAN OF LE GISLATIVE COUNCIL. IN FACT, A MEMBER, AS PER SECTION 2(B) OF THE MEMBERS ACT, 1954, MEANS A MEMBER OF EITHER HOUSE OF PARLIAMENT WHICH DOES NOT INCLUDE A MINISTER, LEADER OF OPPOSITION AND OFFICER OF PARLIAMENT. IT WAS THUS STATED THE OFFICERS ARE COVE RED UNDER SEPARATE ENACTMENT WHO WERE NOT DEALT WITH IN THE CIRCULAR. THE AMOUNTS PAID TO THE CHAIRMAN (PRESIDING OFFICERS) ARE DEALT WITH SEPARATELY UNDER THE SALARIES & ALLOWANCES OF OFFICERS OF PARLIAMENT ACT, 1953. SIMILARLY, UNDER ARTICLE 182 OF THE CONSTITUTION OF INDIA THE LEGISLATIVE COUNCIL OF EVERY STATE CAN CHOOSE TWO MEMBERS OF THE COUNCIL TO ACT AS CHAIRMAN AND DEPUTY CHAIRMAN AND THEY ARE PAID SALARY FOR RENDERING SERVICES AS CHAIRMAN, WHICH IS A FULL - TIME OCCUPATION UNLIKE OTHER CONSTITUTIO NAL BODIES AND THUS EMOLUMENTS RECEIVED BY CHAIRMAN IS ASSESSABLE TO TAX AS SALARY. WITH REGARD TO THE AMOUNT REIMBURSED TO THE ASSESSEE TOWARDS PURCHASE OF FURNITURE AT HIS RESIDENCE , IT WAS CONTENDED THAT ONLY THE PERQUISITE AMOUNT WAS TAKEN INTO CONS IDERATION AND NOT THE FULL AMOUNT OF REIMBURSEMENT. 10 . LD CIT (A) CALLED FOR REMAND REPORT OF THE ASSESSING OFFICER AND THEREAFTER IT WAS PUT TO THE ASSSESSEE BUT, NO REJOINDER WAS FILED EVEN THOUGH TWO OPPORTUNITIES WERE GIVEN. THE LD CIT (A) ACCORDINGLY PROCEEDED WITH THE MATTER. HE OBSERVED THAT AS PER THE PROVISIONS OF SECTION 250(5) OF THE ACT ADDITIONAL GROUND CAN BE ADMITTED 5 IF THE ASSESSEE ESTABLISH ES THAT THERE EXISTED SUFFICIENT REASON FOR NOT RAISING THE GROUND AT THE TIME OF FILING OF APPEAL AND SUCH OMISSION IS NOT WILFUL OR UNREASONABLE. 11 . LD. CIT(A) OBSERVED THAT THE ASSESSEE HAD ORIGINALLY NOT CLAIMED THE ISSUE AS TO WHETHER THE HONORARIUM IS A SALARY INCOME OR NOT AND IT WAS ONLY VIDE LETTER DATED 4.11.2015 ASSESSEE MODIFIED T HE GROUNDS. THESE GROUNDS WERE AGAIN MODIFIED, WHEREIN NINE GROUNDS OF APPEAL WERE TAKEN, WHEREIN IT WAS STATED THAT AS PER FORM NO. 16 ONLY RS. 7,70,100/ - WAS THE SALARY BEFORE TAKING INTO ACCOUNT PERQUISITES WHEREAS THE ASSESSING OFFICER HAD TAKEN INTO A SUM OF RS.7,74,347/ - BY MISTAKE. 12. IT WAS STATED THAT THOUGH THE ASSESSEE HAS RAISED GROUNDS ON TWO OCCASIONS, IN THE FORM OF REVISED GROUNDS, NO MENT ION WAS MADE ABOUT THE CIRCUMSTANCES UNDER WHICH THESE GROUNDS ARE MODIFIED. THEREFORE, THE GROUNDS CONCERNING THE HEAD UNDER WHICH THE HONORARIUM IS TAXABLE WAS NOT ADMITTE D BY THE LD CIT (A). SINCE THE ADDITIONAL GROUNDS / MODIFIED GROUNDS INCLUDE THE CORRECT AMOUNT OF PERQUISITE TOWARDS SALARIES PAID TO THE SUBORDINATE STAFF AND APPLICABILITY OF PROVISIONS OF SECTION 195A OF THE ACT, THE LD. CIT(A) HAS NOT TAKEN INTO CONSIDERATION THOSE ADDITIONAL GROUNDS ALSO AND CONFINED HIMSELF TO THE TAXABILITY OF A SUM OF RS. 3 LAKHS RECEIVED TOWARDS COST OF FURNISHING THE OFFICE CUM RESIDENCE AND IN THIS REGARD HE OBSERVED THAT ONLY 10% OF THE TOTAL VALUE IS ASSESSABLE TO TAX AND THE A.O. WAS DIRECTED ACCORDINGLY. 13 . AGGRIEVED, ASSESSEE PREFERRED SECOND APPEAL B EFORE THE TRIBUNAL CONTESTING ONLY THE FOLLOWING ISSUES I.E., (A) REMUNERATION RECEIVED BY THE ASSESSEE AS PRESIDING OFFICER OF ANDHRA PRADESH LEGISLATIVE COUNCIL IS INCOME FROM SALARIES AND (B) SALARIES PAID TO THE OFFICE SUBORDINATES, REIMBURSED TO THE ASSESSEE, IS AN OFFICE EXPENDITURE . 14 . I HAVE HEARD THE LD COUNSEL FOR THE ASSESSEE AS WELL AS THE SR. DR AND CAREFULLY PERUSED THE RECORD. AT THE OUTSET, IT MAY BE NOTICED THAT THE LD COUNSEL FOR THE ASSESSEE APPEARS TO BE NOT WELL VERSED WITH THE PR OCEDURE AND THE MATTER WAS NOT PROPERLY REPRESENTED BEFORE THE A.O / LD. CIT(A) AND EVEN THE ORIGINAL GROUNDS, MODIFIED GROUNDS AND FURTHER MODIFIED GROUNDS ARE NOT EVEN DATED TO INDICATE WHEN IT WAS FILED. NO REASONS WERE ASSIGNED AS TO WHY THE GROUNDS W ERE TO BE MODIFIED WHICH CAN BE TAKEN A S AN INDICATOR THAT THE PERSON REPRESENTING THE ASSESSEE IS NOT WELL VERSED WITH THE PROCEDURE PRESCRIBED AT THE APPELLATE STAGE. EVEN BEFORE THE 6 TRIBUNAL, THE ASSESSEE DID NOT CHOOSE TO FURNISH ANY REASONS AS TO WHY THE MODIFIED GROUNDS WERE FILED BELATEDLY , DESPITE THE FACT THAT THE MODIFIED GROUNDS WERE NOT ADMITTED BY THE LD. CIT(A) BY APPLYING THE PROVISIONS OF SECTION 250(5) OF THE ACT , WHICH SPEAKS OF LACK OF EXPERTISE ON THE PART OF THE COUNSEL, WHO IS REPRESENTING THE ASSESSEE. THE WRITTEN SUBMISSIONS FILED BEFORE THE LD. CIT(A) CONTAIN MORE OF THE CONSTITUTIONAL PROVISIONS RATHER THAN EXPLAINING THE SIMPLE FACT AS TO WHY THE UNDATED GROUNDS OF APPE AL COULD NOT BE MODIFIED AT THE EARLIEST AND WHY SECOND SET OF MODIFIED GROUNDS WERE NOT SIGNED BY THE ASSESSEE HIMSELF. 15. HOWEVER, THE FACT REMAINS THAT TAX PROCEEDINGS CANNOT BE TREATED ON PAR WITH THE CIVIL PROCEEDINGS OR A LIS BETWEEN TWO PARTIES B U T IT SHOULD BE TREATED AS A TAX ADJUSTMENT BETWEEN THE INCOME TAX DEPARTMENT ON ONE HAND AND THE ASSESSEE , ON THE OTHER HAND [140 ITR 705 (MAD.)] ; UNDER ARTICLE 265 OF THE INCOME TAX ACT, 1961 NO TAX SHALL BE LEVIED OR COLLECTED EXCEPT BY THE AUTHORITY OF LAW AND EVEN IF THE ASSESSEE IS NOT ABLE TO PROPERLY PRESENT HIS CASE, ONLY SUCH INCOME , WHICH IS ASSESSABLE TO TAX , HAS TO BE TAKEN INTO CONSIDERATION AND IN THIS REGARD THE CBDT HAS ISSUED A CIRCULAR (NO. 14 OF 1955, DATED 11.4.1955) WHICH REQUIRES THE OFFICERS OF THE DEPARTMENT TO ASSIST THE TAX PAYER IN EVERY REASONABLE WAY, PARTICULARLY IN THE MATTER OF CLAIMING AND SECURING RELIEF... IN OTHER WORDS, THE OFFICERS OF THE DEPARTMENT MUST NOT TAKE ADVANTAGE OF IGNORANCE OF AN ASSESSEE TO COLLECT MORE TAX THAN WHAT IS LEGITIMATELY DUE. BEARING THIS OBJECTIVE IN MIND, ONE HAS TO SEE AS TO WHETHER THE HONORARIUM RECEIVED BY THE ASSESSEE IS TAXABLE UNDER THE HEAD INCOME FROM OTHER SOURCES O R UNDER THE HEAD SALARY. 16. IT IS NOT IN DISPUTE THAT THE ASSESSEE ALREADY CLAIMED THE SAID INCOME UNDER THE HEAD SALARY AND THOUGH THE MODIFIED GROUND WAS FILED BELATEDLY, THE ISSUE WAS PRESENTED BEFORE THE LD. CIT(A), BASED ON THE DECISION OF THE HONBLE SUPREME COURT (CIVIL APPEAL NO.411 OF 1982 IN THE CASE OF JUSTICE DEOKI NANDAN AGARWALA VS. UNION OF INDIA) AND ALSO THE DECISION OF THE HONBLE PATNA HIGH COURT IN THE CASE OF LALU PRASAD VS. CIT (JUDGMENT DATED 11.11.2008). IN THE FIRST CASE, TH E COURT OBSERVED THAT TH OUGH A JUDGE OF A HIGH COURT OR THE SUPREME COURT HAS NO EMPLOYER AND, THEREFORE, WHAT HE RECEIVES IS NOT SALARY, THE REMUNERATION RECEIVED CAN ONLY BE TERMED AS SALARY. IN FACT ARTICLES 125 AND 221 OF THE CONSTITUTION DEAL WITH THE SALARIES OF SUPREME COURT AND HIGH COURT JUDGES AND THUS IT WAS CONCLUDED THAT THE 7 REMUNERATION RECEIVED SHOULD BE TAXABLE UNDER THE HEAD SALARY. SIMILARLY, THE HONBLE PATNA HIGH COURT OBSERVED THAT THOUGH THE CHIEF MINISTE R IS A CONSTITUTIONAL AUTH ORITY, T HE INCOME RECEIVED BY HIM IS ASSESSABLE TO TAX UNDER THE HEAD SALARY. IN THIS REGARD, THEY HAVE OBSERVED THAT AS PER ARTICLE 164(5) OF THE CONSTITUTION, THE AMOUNT PAYABLE TO THE CHIEF MINISTER IS TERMED AS SALARY AND THEREFORE, THE OBSERVATIO NS OF THE HONBLE SUPREME COURT ARE APPLICABLE IN THIS CASE ALSO. 17 . SAME LOGIC APPLIES TO THE CASE ON HAND. THE AMOUNT PAYABLE TO THE CHAIRMAN OF ANDHRA PRADESH LEGISLATIVE COUNCIL WAS TERMED AS SALARY AND IN FACT FORM NO. 16 WAS ISSUED BY THE GOVERNMENT OF ANDHRA PRADESH. THEREFORE, IN THE INTEREST OF SUBSTANTIAL JUSTICE, THE LD. CIT(A) OUGHT TO HAVE ADMITTED THE CLAIM OF THE ASSESSEE TO ARRIVE AT THE CORRECT TAXABLE INCOME UNDER A PROPER HEAD. HAVING REGARD TO T HE CIRCUMSTANCES OF THE CASE, I AM OF THE FIRM VIEW THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN REJECTING THE ADDITIONAL GROUNDS URGED FOR THE FIRST TIME BEFORE HIM SINCE THE ISSUES RAISED THEREIN ARE PURE LEGAL ISSUES, WHICH WERE ALREADY URGED BEFORE THE ASS ESSING OFFICER BUT BECAUSE OF IMPROPER ASSISTANCE IT COULD NOT BE RAISED AT THE EARLIEST BEFORE THE LD. CIT(A). ON A CONSPECTUS OF THE MATTER, I DEEM IT FAIR AND REASONABLE TO SET ASIDE THE MATTER TO THE FILE OF THE LD. CIT(A) TO RECONSIDER THE MATTER IN ACCORDANCE WITH THE LAW. THOUGH THE MAIN ISSUE I.E., WHETHER THE REMUNERATION RECEIVED BY THE ASSESSEE, IN HIS CAPACITY AS CHAIRMAN OF THE ANDHRA PRADESH LEGISLATIVE COUNCIL, IS ASSESSABLE T O TAX UNDER THE HEAD SALARIES APPEARS TO BE PRIMA FACIE COVERED IN FAVOUR OF THE ASSESSEE, THE MATTER HAVING BEEN SET ASIDE TO THE FILE OF THE LD. CIT(A), NO DECISION IS TO BE TAKEN AT OUR END. LD. CIT(A) MAY CONSIDER THE A DDITIONAL GROUNDS AS WELL AS OTHER GROUNDS RAISED AT THE TIME OF HEARING AND DISPOSE OF T HE APP EAL IN ACCORDANCE WITH LAW LAW. 18 . IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCE D IN THE OPEN COURT ON 22 ND SEPTEMBER, 2017. S D / - (D. MANMOHAN) VICE PRESIDENT HYDERABAD, DATED: 22 ND SEPTEMBER, 2017 8 OKK, SR.PS COPY TO 1. N. MOHAN KUMAR & COMPANY, CHARTERED ACCOUNTANTS, 401, ROHIWAL WINDSOR APARTMENT, HILL FORT ROAD, SAIFABAD, HYDERABAD - 4. 2. ITO, WARD - 7(1), IT TOWERS, A C GUARDS, HYDERABAD. 3. CIT (A) - 10 , MUMBAI. 4. PR. CIT - 3 , HYDERABAD. 5. D.R. ITAT B - SMC BENCH, HYDERABAD. 6. GUARD FILE