DCIT, CHENNAI V. Shri K.Ponnusamy, Trichy

ITA 1479/CHNY/2008

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 57912 (ITAT-CHENNAI)
• Duration Of Justice: 3 year(s) 6 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2012
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 31-01-2012
• Assessment Year: 1994-1995
• Appeal Filed On: 04-07-2008
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: K E B RENGARAJAN JR
• Assessee Lawyers: K SANTHANAKRISHNAN
• Keywords: Gift
• Section: 143(3)

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL CHENNAI C BENCH, CHENNAI. BEFORE SHRI N.S. SAINI, ACCOUNTANT MEMBER & SHRI GEORGE MATHAN, JUDICIAL MEMBER I.T.A. NOS. 1479, 1703 AND 1480/MDS/2008 ASSESSMENT YEARS: 1994-95, 95-96 & 1996-97 & G.T.A. NOS. 02 AND 03/MDS/2008 ASSESSMENT YEARS: 1994-95 & 95-96 THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE II(3), 46, M.G. ROAD, CHENNAI 34. VS. SRI K. PONNUSAMY, 1A, KAZA MIAN STREET, TRICHY 620 006. [PAN: AAEPP9377K] (APPELLANT) (RESPONDENT) REVENUE BY : SHRI K.E.B. RENGARAJAN, JR. STANDING COUNSEL ASSESSEE BY : SHRI K. SANTHANAKRISHNAN, C.A. DATE OF HEARING : 31.01.2012 DATE OF PRONOUNCEMENT : 31.01.2012 ORDER PER N.S. SAINI, ACCOUNTANT MEMBER I.T.A. NOS. 1479, 1703 AND 1480/MDS/2008 ARE THE A PPEALS FILED BY THE REVENUE AGAINST SEPARATE ORDERS OF THE LD. CIT( A) IV, CHENNAI DATED 26.03.2008, 28.05.2008 AND 26.03.2008 IN ASSESSMENT YEARS 1994-95, 95- I.T.A. I.T.A. I.T.A. I.T.A. NO NONO NOS SS S. .. .1479, 1703 & 1480 1479, 1703 & 1480 1479, 1703 & 1480 1479, 1703 & 1480/ // /M/ M/M/ M/08 & 08 & 08 & 08 & G.T.A.NOS. 02 & 03/M/08 G.T.A.NOS. 02 & 03/M/08 G.T.A.NOS. 02 & 03/M/08 G.T.A.NOS. 02 & 03/M/08 2 96 AND 96-97 UNDER INCOME TAX ACT, 1961. APPEALS IN G.T.A. NOS. 02 AND 03/MDS/2008 ARE THE APPEALS FILED BY THE REVENUE AG AINST SEPARATE ORDERS OF LD. CGT(A) IV, CHENNAI BOTH DATED 27.06.2008 IN ASSESSMENT YEARS 1994- 95 AND 95-96 UNDER GIFT TAX ACT, 1958. SHRI K.E.B. RENGARAJAN, JR. STANDING COUNSEL REPRESENTED ON BEHALF OF THE REVENUE AND SH RI K. SANTHANAKRISHNAN, C.A. REPRESENTED ON BEHALF OF THE ASSESSEE. 2. THE GRIEVANCE OF THE REVENUE IN ALL THE INCOME TAX APPEALS IS THAT THE LD. CIT(A) ERRED IN DELETING THE ADDITION OF ` .10,55,000/- IN THE ASSESSMENT YEAR 1994-95, ` . 47,75,000/- IN THE ASSESSMENT YEAR 1995-96 AND ` .5,20,000/- IN THE ASSESSMENT YEA 1996-97 MADE ON A CCOUNT OF VDIS DECLARATION OF SHRI G. VENKATESAN TREATED AS ASSESS EES UNDISCLOSED INCOME. 3. THE BRIEF FACTS LEADING TO THE APPEALS ARE THAT THE ASSESSING OFFICER MADE THE IMPUGNED ADDITION ON THE PRESUMPTION THAT THE ENTIRE AMOUNT DECLARED BY SHRI G. VENKATESAN,1 B, KAJAMIYAN STREE T, KAJA NAGAR, TRICHY HAVING PAN/GI NO. AACPV2412K/26788-V UNDER VDIS IS UNDISCLOSED INCOME OF THE ASSESSEE. HE NOTED THAT SHRI G. VENKA TESAN, EVEN THOUGH MADE DECLARATION OF INCOME UNDER VDIS, DID NOT HAVE THE FUND WITH HIM, WHICH WAS REFLECTED IN THE DECLARATION UNDER VDIS. THEREFORE, THE ASSESSING OFFICER WAS OF THE VIEW THAT THE AMOUNT DECLARED BY SHRI G. VENKATESAN IN HIS DECLARATION UNDER VDIS IN ASSESSMENT YEAR 1994- 95 BELONGS TO THE ASSESSEE AND MADE THE ADDITION OF ` .10,55,000/-. I.T.A. I.T.A. I.T.A. I.T.A. NO NONO NOS SS S. .. .1479, 1703 & 1480 1479, 1703 & 1480 1479, 1703 & 1480 1479, 1703 & 1480/ // /M/ M/M/ M/08 & 08 & 08 & 08 & G.T.A.NOS. 02 & 03/M/08 G.T.A.NOS. 02 & 03/M/08 G.T.A.NOS. 02 & 03/M/08 G.T.A.NOS. 02 & 03/M/08 3 4. SIMILARLY, IN THE ASSESSMENT YEAR 1995-96, THE ASSESSING OFFICER MADE THE IMPUGNED ADDITION ON THE PRESUMPTION THAT THE AMOUNT DECLARED BY SHRI G. VENKATESAN AND SHRI K. RAJAPPA UNDER VDI S WAS UNDISCLOSED INCOME OF THE ASSESSEE. THE ASSESSING OFFICER ALSO NOTED THAT SHRI G. VENKATESAN AND SHRI K. RAJAPPA, THOUGH MADE DECLARA TION OF THE INCOME UNDER VDIS, DID NOT HAVE THE FUNDS WITH THEM, WHICH WERE REFLECTED IN THE DECLARATION MADE UNDER VDIS. THE ASSESSING OFFICER WAS OF THE VIEW THAT THE AMOUNTS DECLARED BY THESE TWO PERSONS IN THE DE CLARATION UNDER VDIS FOR THE ASSESSMENT YEAR 1995-96 BELONG TO THE ASSES SEE AND MADE THE ADDITION OF ` .43,25,000/- AND ` .4,50,000/- RESPECTIVELY. 5. SIMILARLY, IN THE ASSESSMENT YEAR 1996-97, THE ASSESSING OFFICER MADE THE ADDITION OF ` .5,20,000/- TO THE INCOME OF THE ASSESSEE, WHICH WA S DISCLOSED BY SHRI G.VENKATESAN IN HIS DECLARATION U NDER VDIS IN THE ASSESSMENT YEAR 1996-97 FOR SIMILAR REASONS STATED ABOVE. 6. ON APPEAL, THE LD. CIT(A), OBSERVED THAT THE LD . CIT(A) IN THE CASE OF THE SAID SHRI G. VENKATESAN HAS CONFIRMED THE PROTE CTIVE ADDITION IN RESPECT OF THE SAME AMOUNT IN THAT CASE AND TAXES HAVE BEEN COLLECTED THEREON AS A RESULT OF THE ASSESSMENT ORDER UNDER SECTION 143(3) R.W.S. 263 DATED 26.02.2004 AND ALSO AS INFORMED BY THE ASSESSING OF FICER VIDE HIS LETTER DATED 19.11.2004. HE OBSERVED THAT THE ASSESSMENT I N THE CASE OF SHRI G. VENKATESAN HAS BECOME FINAL AND THE ASSESSMENT IN R ESPECT OF THE DISPUTED INCOME HAS BEEN UPHELD IN THE HANDS OF SHRI G. VENK ATESAN AND DELETED THE I.T.A. I.T.A. I.T.A. I.T.A. NO NONO NOS SS S. .. .1479, 1703 & 1480 1479, 1703 & 1480 1479, 1703 & 1480 1479, 1703 & 1480/ // /M/ M/M/ M/08 & 08 & 08 & 08 & G.T.A.NOS. 02 & 03/M/08 G.T.A.NOS. 02 & 03/M/08 G.T.A.NOS. 02 & 03/M/08 G.T.A.NOS. 02 & 03/M/08 4 ADDITION OF ` .10,55,000/- MADE IN THE ASSESSMENT YEAR 1994-95 RE LYING ON THE DECISION OF HONBLE ALLAHABAD HIGH COURT IN THE CASE OF SMT. DURGAVATHI SINGH 234 ITR 249, WHERE IT HAS BEEN HELD THAT THER E IS NO DOUBT AS TO WHICH PERSON AMONGST THE TWO WAS LIABLE TO BE TAXED, PARA LLEL PROCEEDINGS MAY BE TAKEN AGAINST BOTH AND ALTERNATIVE ASSESSMENTS MAY ALSO BE FRAMED. IT IS ALSO EQUALLY TRUE THAT WHILE A PROTECTIVE ASSESSMEN T IS PERMISSIBLE, IT IS NOT OPEN TO THE INCOME TAX APPELLATE AUTHORITIES CONSTI TUTED UNDER THE ACT TO MAKE A PROTECTIVE ORDER. THE LAW DOES NOT PERMIT AS SESSMENT OF THE SAME INCOME SUCCESSIVELY IN DIFFERENT HANDS. THE TAX CAN ONLY BE LEVIED AND COLLECTED IN THE HANDS OF THE PERSON WHO HAS REALLY EARNED THE INCOME AND IS LIABLE TO PAY TAX THEREON. 7. SIMILARLY, IN THE ASSESSMENT YEAR 1995-96, THE LD. CIT(A) DELETED THE ADDITION OF ` .43,25,000/- AND ` .4,50,000/- ON THE GROUND THAT THE LD. CIT(A) IN THE CASE OF THE SAID SHRI G. VENKATESAN HAS CONFIRM ED THE PROTECTIVE ADDITION IN RESPECT OF THE SAME AMOUNT AND THAT THE CASE OF SHRI G VENKATESAN HAD BECOME FINAL. 8. SIMILARLY, IN THE ASSESSMENT YEAR 1996-97, FOR THE SIMILAR REASON, DELETED THE ADDITION OF ` .5,20,000/-. 9. THESE APPEALS WERE FIXED FOR HEARING ON 24.01.2 012. ON THAT DATE, THE LD. AR OF THE ASSESSEE WAS DIRECTED TO PRODUCE THE LD. CIT(A)S ORDERS IN THE CASE OF SHRI G. VENKATESAN AND SHRI K. RAJAPPA FOR THE ASSESSMENT YEARS 1994-95, 95-96 AND 96-97. THE LD. AR COULD FILE CIT (A)S ORDERS IN THE I.T.A. I.T.A. I.T.A. I.T.A. NO NONO NOS SS S. .. .1479, 1703 & 1480 1479, 1703 & 1480 1479, 1703 & 1480 1479, 1703 & 1480/ // /M/ M/M/ M/08 & 08 & 08 & 08 & G.T.A.NOS. 02 & 03/M/08 G.T.A.NOS. 02 & 03/M/08 G.T.A.NOS. 02 & 03/M/08 G.T.A.NOS. 02 & 03/M/08 5 ASSESSMENT YEARS 1994-95 AND 95-96. HOWEVER, HE HAS NOT FILED THE CIT(A)S ORDER IN THE CASE OF SHRI G. VENKATESAN AN D SHRI K. RAJAPPA FOR THE ASSESSMENT YEAR 1996-97. 10. THUS, THE ENTIRE FACTS THAT THE IMPUGNED INCOM E HAS BEEN FINALLY ASSESSED IN THE HANDS OF SHRI G. VENKATESAN AND SHR I K. RAJAPPA ARE NOT AVAILABLE BEFORE US TO DECIDE THE APPEAL. FURTHER, THE LD. DR HAS ALSO FILED THE STATEMENT OF SHRI V. JAYARAMAN, S/O LATE M. VEN KATASALAM DATED 23.10.1997 AS ALSO THE RELEVANT EXTRACT OF THE STAT EMENT OF SHRI G. VENKATESAN GIVEN TO THE ENFORCEMENT OFFICER ON 06.0 1.1998. WE FIND THAT THE LD. CIT(A) HAS NOT CONSIDERED THESE STATEMENTS WHILE DELETING THE IMPUGNED ADDITIONS. FURTHER, BOTH THE PARTIES ALSO COULD NOT INFORM WHETHER THE ORDER OF THE LD. CIT(A) IN THE CASE OF SHRI G. VENKATESAN AND SHRI K. RAJAPPA WAS APPEALED AGAINST TO THE TRIBUNAL AND IF SO, WHAT WAS THE FINDING OF THE TRIBUNAL. THUS, ALL THE MATERIALS NE CESSARY TO DECIDE THESE PRESENT APPEALS ARE NOT BEING PLACED BEFORE US, WE ARE NOT IN A POSITION TO ADJUDICATE THE ISSUE COMPLETELY. THUS, WE HAVE NO O PTION, BUT TO RESTORE THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER FO R READJUDICATION IN THE LIGHT OF THE OBSERVATIONS MADE HEREIN ABOVE. 11. FURTHER, THE ISSUE IN GIFT TAX APPEAL IN GTA N OS.02 AND 03/MDS/2008 ALSO BEING INCIDENTAL TO THE FINDINGS OF THE ABOVE INCOME TAX APPEALS ARE ALSO RESTORED BACK TO THE FILE OF THE ASSESSING OFF ICER FOR READJUDICATION AFRESH. I.T.A. I.T.A. I.T.A. I.T.A. NO NONO NOS SS S. .. .1479, 1703 & 1480 1479, 1703 & 1480 1479, 1703 & 1480 1479, 1703 & 1480/ // /M/ M/M/ M/08 & 08 & 08 & 08 & G.T.A.NOS. 02 & 03/M/08 G.T.A.NOS. 02 & 03/M/08 G.T.A.NOS. 02 & 03/M/08 G.T.A.NOS. 02 & 03/M/08 6 12. IN THE RESULT, ALL THE APPEALS OF THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED AT THE CLOSE OF THE HEARING IN T HE PRESENCE OF THE PARTIES ON 31.01.2012. SD/ - SD/ - (GEORGE MATHAN) JUDICIAL MEMBER (N.S.SAINI) ACCOUNTANT MEMBER CHENNAI, DATED, THE 31.01.2012 VM/- TO: THE ASSESSEE//A.O./CIT(A)/CIT/D.R.