Akshay Bhandari, Pune V. Income-tax Officer, Ward - 13(1), Pune

ITA 149/PUN/2019

AI Insights

The case involves Shri Akshay Bhandari appealing against the order of the CIT(A), Pune, which confirmed the additions made to his income by the Income Tax Officer for the assessment year 2012-13. The primary contention was regarding the taxability of Rs.4.33 crores received by the assessee, which included a dishonored cheque of Rs.2.17 crores. The assessee argued that the income should be recognized based on the project completion method of accounting, which was not accepted by the lower authorities. The Tribunal upheld the CIT(A)'s decision, noting that the project was still under construction and the cheque, although dishonored, was eventually received in a subsequent assessment year.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 137026 (ITAT-PUNE)
• Duration Of Justice: 3 year(s) 11 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2023
• Appeal Filed By: Assessee
• Order Result: DismissedDismissed
• Bench Allotted: A
• Next Hearing Date: 19-10-2022
• Assessment Year: 2012-2013
• Appeal Filed On: 24-01-2019
• Laws Referred To: Income Tax Act, 1961, Negotiable Instruments Act, 1881
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “A” : PUNE BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND DR. DIPAK P. RIPOTE, ACCOUNTANT MEMBER ITA.No.149/PUN./2019 Assessment Year 2012-13 Shri Akshay Bhandari, Pune-411 037 PAN AKXPB9206G C/o. Shah Khandelwal Jain & Associates, Level 3, Riverside Business Bay, Wellesley Road, Besides Sangam Bridge RTO, Pune-411001 . vs. The Income Tax Officer, Ward 13 (1), Pune – 411 037. Maharashtra. (Appellant) (Respondent) For Assessee : Shri Rajiv Thakkar For Revenue : Shri Ramnath P. Murkunde Date of Hearing : 20.10.2022 Date of Pronouncement : 09.01.2023 ORDER PER SATBEER SINGH GODARA, J.M. This assessee’s appeal for assessment year 2012-13, arises against the CIT(A), Pune-10, Pune’s order dated 02.11.2018, passed in case No.PN/CIT(A)10/ITO Wd13(1)/181/16-17, involving proceedings under Section 143(3) of the Income Tax Act, 1961 (in short “the Act”). 2. Heard both the parties. Case file perused. 3. The assessee raises the following sole substantive grounds in the instant appeal : 2 ITA.No.149/PUN./2019 Shri Akshay Bhandari, Pune. 1. “On facts and circumstances prevailing in the case and as per the provisions and scheme of the Act, it be held that the Ld. AO erred in making and the Ld CIT(A) erred in confirming an addition of Rs.4,33,00,000/- to the income of the appellant without taking into consideration the facts and method of accounting followed by the appellant. The appellant be granted just and proper relief in this respect. 2. Without prejudice to ground 1 and on facts and circumstances prevailing in the case and as per the provisions and scheme of the Act, it be held that Ld. AO failed to appreciate the fact pertaining to non-receipt of Rs.2,17,00,000/- to due to dishonor of cheque and made an addition of 4,33,00,000/- which includes the said amount and the Ld. CIT(A) erred in not adjudicating the same. The appellant be granted just and proper relief in this respect. 3. Without prejudice to ground 1 and 2 and on facts and circumstances prevailing in the case and as per the provisions and scheme of the Act, it be held that the Ld. AO erred in not allowing the cost for buying the said land under consideration and the expenses incurred by the appellant on the said land and the Ld. CIT(A) erred in not adjudicating the same. The appellant be granted just and proper relief in this respect. 4. The appellant prays to be allowed to add, amend, modify, rectify, delete, raise any grounds of appeal at the time of hearing.” 4. We next note that CIT(A)'s detailed discussion rejecting assessee’s former twin substantive grounds reads as under : 3 ITA.No.149/PUN./2019 Shri Akshay Bhandari, Pune. 4 ITA.No.149/PUN./2019 Shri Akshay Bhandari, Pune. 5 ITA.No.149/PUN./2019 Shri Akshay Bhandari, Pune. 6 ITA.No.149/PUN./2019 Shri Akshay Bhandari, Pune. 5. Both the learned representatives reiterated their respective stands against and in support of the lower authorities action rejecting the assessee’s contentions. 6. Mr. Thakkar vehemently argued that the learned lower authorities have not considered the assessee’s mercantile system of accounting following project completion method. And that they have also not appreciated the clinching 7 ITA.No.149/PUN./2019 Shri Akshay Bhandari, Pune. aspect that the assessee’s cheque involving an amount of Rs.2.17 crores had been dishonoured as per his bank statement and, therefore, the same ought not to have been taxed in the impugned assessment year. All these assessee’s arguments fail to convince us. So far as his case that the consideration money cheque of Rs.2.17 crores had not been honoured by the vendee, learned counsel duly accepted the fact that the same had been received in subsequent assessment year which would go back to the relevant date of the concerned negotiable instrument u/s.118 of the Negotiable Instruments Act, 1881 itself. His further arguments that the learned lower authorities ought to have allowed the assessee to follow project completion method also fails to evoke our concurrence as the developer herein is M/s. AMI Estates LLP’s correspondence dated 14.06.2022 at page-99 makes it clear that the project is still under construction. We fail to consider the instant arguments as this assessee could claim project completion method once it is not even developing the said project. Be that as it may, we express our complete agreement with the CIT(A)'s findings affirming Assessing Officer’s action for assessing this taxpayer for having received the amount in question of Rs.4.33 crores after execution of the corresponding sale deed in the relevant previous year. The assessee’s former twin substantive grounds are rejected with a rider that the Assessing Officer shall ensure that there is no double addition 8 ITA.No.149/PUN./2019 Shri Akshay Bhandari, Pune. on the very issue in any subsequent assessment year. Ordered accordingly. 7. Learned counsel lastly contended that both the lower authorities have not granted the assessee cost of the closing work in progress of Rs.1,75,45,390/- regarding the land in question. We note that the assessee had duly raised the very substantive ground no.4 before the CIT(A). His written submissions reproduced in the CIT(A)'s detailed discussion at page-26 suggest that he had also moved his rectification application before the Assessing Officer to this effect. This is coupled with the clinching fact that the Assessing Officer had rejected the assessee’s rectification on 25.05.2015 as the said order is available at pages-97-98 in the paper book. We thus find no reason to accept the assessee’s instant third substantive ground. Rejected accordingly. 8. This assessee’s appeal is dismissed in above terms. Order pronounced in the open Court on 09.01.2023. Sd/- Sd/- [DR. DIPAK P. RIPOTE] [SATBEER SINGH GODARA] ACCOUNTANT MEMBER JUDICIAL MEMBER Pune, Dated 09 th January, 2023 VBP/- 9 ITA.No.149/PUN./2019 Shri Akshay Bhandari, Pune. Copy to 1. The appellant 2. The respondent 3. The Ld. CIT(A) concerned. 4. The CIT concerned 5. D.R. ITAT, Pune “A” Bench, Pune 6. Guard File. //By Order// Assistant Registrar, ITAT, Pune Benches, Pune.