Dr. Gaba & Associates Medicare Pvt. Ltd, New Delhi V. ACIT, New Delhi

ITA 1484/DEL/2009

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 1272 (ITAT-DELHI)
• Duration Of Justice: 7 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-11-2009
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 17-11-2009
• Assessment Year: 2005-2006
• Appeal Filed On: 15-04-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SUKHBIR CHAUDHARY
• Assessee Lawyers: ALOK MATHUR
• Keywords: Wrong claim; Set aside

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH : C NEW DELHI) BEFORE SHRI C.L. SETHI, J UDICIAL MEMBER AND SHRI K.D. RANJAN, ACCOUNTANT MEMBER I.T.A. NO.1484/DEL./2009 (ASSESSMENT YEAR : 2005-06) DR. GABA & ASSOCIATES MEDICARE PVT. LTD., VS. ACIT, CIRCLE 10(1), 100, SHEIKH SARAI, PHASE 1, NEW DELHI. RPS,DDA FLATS, NEW DELHI. (PAN/GIR NO.AACCG1211E) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI ALOK MATHUR REVENUE BY : SHRI SUKHBIR CHAUDHARY, DR ORDER PER K.D. RANJAN, AM THIS APPEAL BY THE ASSESSEE FOR ASSESSMENT YEAR 20 05-06 ARISES OUT OF THE ORDER OF COMMISSIONER OF INCOME-TAX(APPEALS)-XIII, NEW DELHI . 2. THE ASSESSEE HAS RAISED TWO GROUNDS IN RESPECT O F DISALLOWANCE OF RS.79,369/- ON ACCOUNT OF HOUSE TAX AND RS.75,000/- PAID TO MRS. A LKA GABA. THE FACTS OF THE CASE STATED IN BRIEF ARE THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF OPERATING HOSPITAL UNDER THE NAME AND STYLE OF AAKASH HOSPITAL. FROM THE PE RUSAL OF P&L A/C, THE ASSESSING OFFICER FOUND THAT HOUSE TAX OF RS.79,369.80 WAS DE BITED TO IT. ON ENQUIRY, IT WAS FOUND THAT THE HOUSE TAX RECEIPT WAS IN THE NAME OF DR. A JIT GABA, THE OWNER OF THE PROPERTY. THERE WAS NO RENT AGREEMENT WITH THE ASSESSEE. THE ASSESSING OFFICER, THEREFORE, DERIVED THE DEDUCTION OF PROPERTY TAX. AS REGARDS THE PAYM ENT MADE TO DR. ALKA GABA, THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAD SHOWN PAYMENT OF RENT FOR THE HOSPITAL TO DR. AJIT GABA, DR. VIMRASH RAINA, DR. ALKA GABA AND ALSO MADE PAYMENT OF RENT FOR HOSPITAL OF STAFF NURSE TO NEELAM SAINI, J.B. SAINI , SATYA PRAKASH, ZAHEER, SATENDER KUMAR. FROM THE DETAILS FURNISHED, THE ASSESSING O FFICER FOUND THAT THE PROPERTY CONSISTING OF BASEMENT AND GROUND FLOOR WAS OWNED B Y DR. VIMRASH RAINA. THE FIRST AND SECOND FLOOR WAS OWNED BY DR. AJIT GABA AND NONE OF THE PORTION OF THE PROPERTY WAS I.T.A. NO.1484/DEL./2009 (A.Y. : 2005-06) 2 TAKEN BY THE ASSESSEE ON RENT AND USED FOR THE PURP OSES OF HOSPITAL. THE ASSESSEE CLAIMED EXPENDITURE OF RS.75,000/- ON ACCOUNT OF RENT PAID TO DR. ALKA GABA IN SPITE OF THE FACTS THAT SHE WAS NOT THE OWNER OF THE HOUSE PROPERTY. THE ASSESSING OFFICER DISALLOWED THE EXPENDITURE OF RS.75,000/-. 3. ON APPEAL, THE COMMISSIONER OF INCOME-TAX (APPEA LS) UPHELD THE DISALLOWANCE OF RS.79,369/- ON THE GROUND THAT THERE WAS NO DOCUMEN T TO JUSTIFY THE PAYMENT OF HOUSE TAX FOR THE PREMISES USED BY THE ASSESSEE. IT WAS ALSO NOT EXPLAINED AS TO WHAT WERE THE TERMS ON WHICH THE PROPERTY HAD BEEN LET OUT TO THE ASSES SEE. AS REGARDS THE PAYMENT MADE TO DR. ALKA GABA, IT WAS SUBMITTED THAT RENT PAYMENT T O DR. ALKA GABA WAS RELATED TO PREMISES OF SHEIKH SARAI PROPERTY. DR. ALKA GABA H AD ALSO OFFERED THE AMOUNT FOR TAXATION. THE CIT(A) AFTER CONSIDERING THE SUBMISS IONS MADE BY THE ASSESSEE OBSERVED THAT THE WRONG CLAIM HAD BEEN MADE BY THE ASSESSEE AND THERE WAS NO JUSTIFICATION FOR PAYING ANY RENT TO DR. ALKA GABA. THERE WAS NO EVI DENCE OR DOCUMENT OR ANY RENT AGREEMENT TO ESTABLISH THAT THE ASSESSEE COMPANY WA S UTILIZING ANY PROPERTY BELONGING TO DR. ALKA GABA. THEREFORE, THE ASSESSEE HAD MADE A FALSE CLAIM. HE FURTHER NOTED THAT THE ASSESSEE HAS DEVISED A MECHANISM TO REDUCE THE INCO ME OF THE ASSESSEE AND SIPHON OFF THE FUNDS FROM THE COMPANY TO ANOTHER INDIVIDUAL. HE A CCORDINGLY UPHELD THE ADDITION OF RS.75,000/- ALSO. 4. BEFORE US, LD.AR OF THE ASSESSEE SUBMITTED THAT HOUSE TAX WAS PAID BY THE COMPANY AND, THEREFORE, THE SAME WAS ALLOWABLE AS E XPENDITURE. HOWEVER, HE COULD NOT ANSWER TO A QUERY AS TO WHETHER DR. AJIT GABA HAD C LAIMED THE DEDUCTION IN RESPECT OF HOUSE TAX WHILE COMPUTING HIS INCOME FROM HOUSE PRO PERTY. AS REGARDS THE PAYMENT MADE TO DR. ALKA GABA, IT WAS SUBMITTED THAT THE P AYMENT RELATED TO SHEIKH SARAI PROPERTY AND THE AMOUNT HAS BEEN OFFERED FOR TAXATI ON. ON THE OTHER HAND, LD.SR.DR SUPPORTED THE ORDER OF THE CIT(A). 5. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. FROM THE ABOVE FACTS, IT IS NOT CLEAR WHETHER DR. A JIT GABA HAD CLAIMED DEDUCTION OF PROPERTY TAX PAID WHILE COMPUTING HIS INCOME FROM H OUSE PROPERTY. LIKEWISE, THE CONTENTION OF THE ASSESSEE IS THAT PAYMENT HAS BEEN MADE TO DR. ALKA GABA IN RESPECT OF I.T.A. NO.1484/DEL./2009 (A.Y. : 2005-06) 3 SHEIKH SARAI PROPERTY. HOWEVER, NO EVIDENCE HAS BE EN FILED BEFORE US. IT HAS ALSO BEEN SUBMITTED THAT DR. ALKA GABA HAS ADMITTED THE INCOM E IN HER HANDS. ON CONSIDERATION OF ABOVE FACTS, WE FEEL IT PROPER TO SET ASIDE THE MAT TER TO THE FILE OF THE ASSESSING OFFICER WITH THE DIRECTIONS TO EXAMINE WHETHER DR. AJIT GAB A HAD CLAIMED THE DEDUCTION IN HIS CASE WHILE COMPUTING THE HOUSE TAX PROPERTY INCOME. IF HE HAS CLAIMED THE DEDUCTION ON ACCOUNT OF TAXES PAID TO MCD, THE SAME WILL NOT BE ALLOWABLE AS DEDUCTION IN THE CASE OF THE ASSESSEE. THE ASSESSING OFFICER WILL DECIDE TH E ISSUE ON MERIT AFTER HEARING THE ASSESSEE. AS REGARDS PAYMENT OF RS.75,000/-, THE ASSESSING OFFICER WILL EXAMINE THE CONTENTION OF THE ASSESSEE WHETHER PROPERTY OF SHEI KH SARAI BELONGING TO DR. ALKA GABA WAS LET OUT TO THE HOSPITAL ON RENT. HE WILL EXAMIN E THE RELEVANT EVIDENCE FOR USE OF THE PROPERTY FOR THE PURPOSES OF BUSINESS AND DECIDE TH E ISSUE ON MERITS AFTER HEARING THE ASSESSEE. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 6. ORDER PRONOUNCED IN OPEN COURT ON 17.11.2009 AFT ER THE CONCLUSION OF THE HEARING OF THE APPEAL. SD/- SD/- (C.L. SETHI) (K.D. RANJAN) JUDICIAL MEMBER. ACCOUNTANT MEMBER DATED, NOV. 17, 2009. *SKB* COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A)-XIII,NEW DELHI. 5. THE DR, ITAT, LOKNAYAK BHAWAN, KHAN MARKET, NEW DELHI. BY ORDER (ITAT, NEW DELHI). I.T.A. NO.1484/DEL./2009 (A.Y. : 2005-06) 4