Tsurphu Labrang, New Delhi V. ITO, New Delhi

ITA 1510/DEL/2017

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 8530 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 9 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2008-2009
• Appeal Filed On: 14-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: V RAJ KUMAR
• Keywords: Tangible material; Reason to believe; Capital expenditure
• Section: 12A; 12AA; 143(2); 147; 148; 12; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G, NEW DELHI BEFORE SH. H. S. SIDHU, JUDICIAL MEMBER DR. B. R. R. KUMAR, ACCOUNTANT MEMBER (THROUGH VIDEO CONFERENCING) ITA NO. 1509/DEL/2017 : ASSTT. YEAR : 2007-08 ITA NO. 1510/DEL/2017 : ASSTT. YEAR : 2008-09 TSURPHU LABRANG, E-59, GROUND FLOOR, GRATER KAILASH - II, NEW DELHI - 110048 VS INCOME TAX OFFICER, WARD-2(3), NEW DELHI - 110002 (APPELLANT) (RESPONDENT) PAN NO. AABTT9161A ASSESSEE BY : SH. K. SAMPATH, ADV. & SH. V. RAJ KUMAR, ADV. REVENUE BY : SH. APOORVA BHARDWAJ, SR. DR DATE OF HEAR ING: 0 7 . 01 .20 2 1 DATE OF PRONOUNCEMENT: 08 .01 .20 2 1 ORDER PER DR. B.R.R. KUMAR, ACCOUNTANT MEMBER: THE PRESENT APPEALS HAVE BEEN FILED BY THE ASSESSE E AGAINST THE ORDERS OF LD. CIT (A)-40, NEW DELHI DAT ED 07.02.2017. 2. SINCE, THE ISSUES INVOLVED IN BOTH THE APPEALS A RE COMMON, THEY WERE HEARD TOGETHER. 3. IN ITA NO. 1509/DEL/2017, FOLLOWING GROUNDS HAVE BEEN RAISED BY THE ASSESSEE: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CTT (A) HAS ERRED IN UPHOLDING THE INITIATION OF PROCEEDINGS UNDER SECTION 147 OF THE I.T ACT, 1961 BY THE LEARNED A.O AND THE REASSESSMENT ORDER PASSED BY TH E ITA NOS. 1509 & 1510/DEL/2017 TSURPHU LABRANG 2 LEARNED A.O IN CULMINATION THERETO. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT (A) HAS ERRED IN HOLDING THAT RUPEE EQUIVALENT OF INTENDED OFFERING OF FOREIGN CURRENCI ES BY THE DEVOTEES AMOUNTING TO RS.98,99,491/- IN THE PRE VIOUS YEAR IS INCOME OF THE APPELLANT AND CONSEQUENTLY CONFIRMING ADDITION OF RS.98,99,491/- TO THE TOTAL INCOME. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT (A) HAS ERRED IN CONFIRMING THE DISALLO WANCE AND CONSEQUENT ADDITION OF RS. 7,91,659/- TO THE TO TAL INCOME OUT OF EXPENSES ON ACCOUNT OF HELP, CHARITY AND DONATIONS. 4. THE REASONS RECORDED BEFORE ISSUE OF THE NOTICE U/S 148 FOR THE ASSESSMENT YEARS 2007-08 AND 2008-09 IS REPRODUCED BELOW: THIS OFFICE IS IN POSSESSION OF CREDIBLE INFORMATI ON THAT THE ASSESSEE TSUPHU LABRANG IS NOT REGISTERED U/S 12A O F THE INCOME TAX ACT 1961 FOR THE YEAR UNDER CONSIDERATION. THE ASSESSEE HAS FILED BELATED RETURN FOR A.Y. 2008-09 ON 24.06.2011 IN FORM NO. ITR7 MEANT FOR ASSESSEE CLAIMING BENEFITS OF EXEMPT ION U/S 11 AND 12 OF THE ACT. WHILE GOING THROUGH THE INCOME A ND EXPENDITURE ACCOUNT, FOR THE YEAR UNDER CONSIDERATI ON IT REVEALS THAT THE ASSESSEE HAS CLAIMED EXPENSES ON ACCOUNT O F DONATION AMOUNTING TO RS.53,55,708/-. FURTHER, THE ASSESSEE HAS CLAIMED CAPITAL EXPENDITURE OF RS.4,13,678/- IN ITS COMPUTA TION OF INCOME. SINCE, THE ASSESSEE IS NOT ELIGIBLE FOR BENEFITS OF SECTION 11 AND 12 OF THE ACT, THIS HAS RESULTED IN CLAIM OF EXCESSIVE EXPENDITURE WHICH IS REQUIRED TO BE ADDED BACK TO THE TOTAL INC OME OF THE ASSESSEE. IN VIEW OF THE ABOVE, I HAVE REASON TO BELIEVE THAT AMOUNTS TO THE EXTENT MENTIONED ABOVE CHARGEABLE TO TAX HAS ESCAPE D ASSESSMENT WITHIN THE MEANING OF PROVISION OF SECTI ON 147 OF THE ACT FOR THE ASSESSMENT YEAR 2008-09. THEREFORE, NOTICE U/S 148 OF THE INCOME TAX ACT, 19 61 DATED 30.03.2014 ISSUED FOR ASSESSMENT YEAR 2008-09. SD/- DDIT (E), TRUST CIRCIE-IV, NEW DELHI 5. WE FIND THAT EXCEPT THE CLAIM OF CAPITAL EXPENDI TURE AND DONATION, THE VERBATIM OF NOTICE IS THE SAME FOR BOTH THE YEA RS. ITA NOS. 1509 & 1510/DEL/2017 TSURPHU LABRANG 3 6. HEARD THE ARGUMENTS OF BOTH THE PARTIES AND PERU SED THE MATERIAL AVAILABLE ON RECORD. 7. REGARDING THE GROUNDS IN RELATION TO ISSUE OF NO TICE U/S 148 OF THE INCOME TAX ACT, 1961, THE LD. CIT (A) DISMISSED THE PLEA OF THE ASSESSEE HOLDING THAT THE ASSESSEE IS NOT REGISTERED U/S 12A A AND FILED BELATED RETURNS AND SINCE THE ASSESSEE HAS NOT TAKEN ANY OB JECTION TO THE NOTICE U/S 148 DURING THE ASSESSMENT PROCEEDINGS, THE NOTI CE ISSUED IS VALID. 8. WE HAVE GONE THROUGH THE REASONS RECORDED BY THE REVENUE AND FIND THAT THE ASSESSMENT YEAR 2007-08 AND FOR THE ASSESS MENT YEAR 2008-09 THE ASSESSEE HAS FILED RETURN ON 24.06.2011. THE NO TICE U/S 148 HAS BEEN ISSUED ON 30.03.2014 MUCH AFTER THE DATE OF EXPIRY TO ISSUE NOTICE U/S 143(2) IN THE REGULAR COURSE OF ASSESSMENT PROCEEDI NGS. THE SINE QUA NON FOR ISSUE OF NOTICE U/S 148 FOR REASSESSMENT OF ESC APED INCOME IS THAT THE ASSESSING OFFICER SHOULD HAVE REASONS TO BELIEVE TH AT THE INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. THE REVEN UE AUTHORITIES HAVING LOSS THE OPPORTUNITY TO ISSUE NOTICE U/S 143 (2) HAVE RESORTED TO ISSUE OF NOTICE U/S 148 IN THE ABSENCE OF ANY OTHER TANGIBLE MATERIAL OTHER THAN THE RETURN FILED BY THE ASSESSEE BEFORE THEM. FILING OF A BELATED RETURN AND NON-REGISTRATION OF THE ENTITY U/S 12AA CANNOT BE HELD TO BE VALID REASONS GOOD ENOUGH TO ISSUE NOTICE U/S 148. 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON 08/01/2021. SD/- SD/- (H. S. SIDHU) (DR. B . R. R. KUMAR) JUDICIAL MEMBER ACCOUNTAN T MEMBER DATED: 08/01/2021 *SUBODH*