Bimal Kishore Sharma, Secunderabad, Hyderabad V. DCIT, Circle-16(2), Hyderabad, Hyderabad

ITA 1572/HYD/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 2428 (ITAT-HYDERABAD)
• Duration Of Justice: 11 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-11-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 26-07-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 24-11-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: B KURMI NAIDU
• Keywords: Unexplained investment; Retraction
• Section: 143(3); 133A; 147; 148

Judgement Text

ITA NO 1572 OF 2016 BIMAL KISHOR E SHARMA HYDERABAD. PAGE 1 OF 5 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER ITA NO. 1572/HYD/2016 (ASSESSMENT YEAR: 2010-11) SHRI BIMAL KISHORE SHARMA SECUNDERABAD PAN: AJVPS 7657 K VS DY. COMMISSIONER OF INCOME TAX, CIRCLE 16(2) HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI K.C. DEVDAS FOR REVENUE : SHRI B. KURMI NAIDU, DR O R D E R PER SMT. P. MADHAVI DEVI, J.M. THIS IS ASSESSEES APPEAL FOR THE A.Y 2010-11. THIS APPEAL IS AGAINST THE ORDER OF THE CIT (A)-4, HYDER ABAD, DATED 15.09.2016. FOR THE SAKE OF CLARITY AND READY REFER ENCE, THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE REPROD UCED AS UNDER: 1. THE ORDER OF THE HON'BLE CIT (A) IS ERRONEOUS IN LAW AS WELL AS FACTS OF THE CASE. 2. THE HON'BLE CIT (A) ERRED IN UPHOLDING THE ADDI TION OF RS.6,24,763 TOWARDS UNEXPLAINED INVESTMENT AND THEREFORE, THE SAME IS LIABLE TO BE DELETED. 3. THE HON'BLE CIT (A) ERRED IN SUSTAINING THE ADD ITION TO THE EXTENT OF RS.1.00 LAKHS IGNORING THE FACT TH AT THE SAME WAS INCURRED FOR THE PURPOSE OF BUSINESS . DATE OF HEARING: 18.10.2017 DATE OF PRONOUNCEMENT: 15 . 1 1 .2017 ITA NO 1572 OF 2016 BIMAL KISHOR E SHARMA HYDERABAD. PAGE 2 OF 5 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE, A N INDIVIDUAL, ENGAGED IN THE BUSINESS OF LOGISTIC SER VICES, FILED HIS RETURN OF INCOME FOR THE A.Y 2010-11 ON 15.10.2010 ADMITTING INCOME OF RS.12,95,890. THE SAME WAS INITIALLY PROC ESSED U/S 143(1) AND SUBSEQUENTLY THE CASE WAS REOPENED U/S 1 47 BY ISSUANCE OF A NOTICE U/S 148 DATED 26.03.2013. DURI NG THE ASSESSMENT PROCEEDINGS U/S 143(3) R.W.S. 147 OF THE ACT, THE AO OBSERVED THAT DURING THE COURSE OF SURVEY OPERATION U/S 133A CONDUCTED IN THE BUSINESS PREMISES OF M/S MERIDIAN CARGO LINES PVT LTD HYDERABAD, CERTAIN INCRIMINATING MATERIAL W AS IMPOUNDED AND IT IS NOTICED THEREFROM THAT VIDE AGREEMENT OF SALE DATED 18.09.2009 BETWEEN M/S. SWARNA BHOOMI DEVELOPERS PV T. LTD (VENDOR) AND THE ASSESSEE, THE ASSESSEE HAS PURCHAS ED PLOT NO.389 ADMEASURING 267 SQ. YARDS IN SWARNA KUTIR PH ASE-II, VITYALA VILLAGE, MAHABOOBNAGAR DISTRICT FOR A TOTAL SALE CONSIDERATION OF RS.7,58,263 BUT THAT THE VENDOR AN D THE ASSESSEE HAVE EXECUTED A REGISTERED SALE DEED BEARING NO.685 /2010, DATED 10.02.2010 MENTIONING THE SALE CONSIDERATION AT RS. 1,33,500 ONLY. THE ASSESSEE WAS THEREFORE, ASKED TO EXPLAIN THE DIFFERENCE OF RS.6,24,763 BETWEEN THE AGREEMENT OF SALE DATED 18.09.2009 AND THE REGISTERED SALE DEED, DATED 10.02.2010. IN HIS SWORN STATEMENT DATED 28.07.2010, THE ASSESSEE ADMITTED T O HAVE PAID A SUM OF RS.7,58,263 AND AGREED THAT THE DIFFERENCE OF RS.6,24,763 STANDS UNEXPLAINED AND VOLUNTEERED TO OFFER THIS IN COME IN HIS INDIVIDUAL HANDS FOR THE FINANCIAL YEAR 2010-11. AC CORDINGLY, THE ASSESSEE OFFERED THE SAID INCOME TO TAX AND PAID TH E REQUISITE TAX. HOWEVER, DURING THE COURSE OF ASSESSMENT PROCEEDING S, THE ASSESSEE, VIDE HIS LETTER DATED NIL SUBMITTED THA T THE TOTAL CONSIDERATION FOR THE PROPERTY INCLUDING THE REGIST RATION CHARGES ITA NO 1572 OF 2016 BIMAL KISHOR E SHARMA HYDERABAD. PAGE 3 OF 5 WORKED OUT TO RS.7,22,963 AND THAT ALL THE AMOUNTS WERE WITHDRAWN FROM THE BOOKS OF BKS GLOBAL SOLUTIONS, A PROPRIETARY CONCERN OF THE ASSESSEE. THE ACCOUNT COPY SHOWING T HE LAND AND BUILDING FOR THE PERIOD 1.4.2009 TO 31.03.2010 AS A PPEARING IN THE LEDGER A/C WAS ENCLOSED AND ALSO IT WAS SUBMITT ED THAT THE SURVEY OPERATION HAD TAKEN PLACE ON 28.07.2010 AND BY THAT TIME THE ACCOUNT BOOKS OF THE CONCERN WERE CLOSED AND AL L THE WITHDRAWALS WERE DULY RECORDED IN THE ACCOUNT BOOKS OF THE CONCERN AND SINCE IT WAS RECORDED IN THE BOOKS, SOU RCES FOR THE DIFFERENCE OF AMOUNT IS EXPLAINED, IT SHOULD NOT BE BROUGHT TO TAX. THE AO HOWEVER, DID NOT ACCEPT THE ASSESSEES CONTE NTION AND HELD THAT THE ASSESSEE FAILED TO EXPLAIN WITH REQUI RED EVIDENCE REGARDING THE SOURCE FOR THE DIFFERENCE IN THE SALE CONSIDERATION MENTIONED IN THE AGREEMENT OF SALE AND IN THE REGIS TERED SALE DEED AND THAT THE RETRACTION DURING THE COURSE OF ASSESS MENT PROCEEDINGS IS AN AFTERTHOUGHT. HE THEREFORE, REJEC TED THE ASSESSEES EXPLANATION AND MADE THE ADDITION OF RS. 6,24,763 TO THE RETURNED INCOME OF THE ASSESSEE. 3. FURTHER, THE AO ALSO CONSIDERED THAT THERE ARE UNVOUCHED EXPENDITURE CLAIMED BY THE ASSESSEE. IN T HE ABSENCE OF GENUINE BILLS/VOUCHERS IN SUPPORT OF SUCH EXPEND ITURE, THE AO DISALLOWED THE ENTIRE LORRY HIRE CHARGES OF RS.5,74 ,056 AND BROUGHT IT TO TAX. 4. AGGRIEVED BY THESE ADDITIONS, THE ASSESSEE PREFE RRED AN APPEAL BEFORE THE CIT (A). THE CIT (A) CONFIRMED TH E REJECTION OF ASSESSEES EXPLANATION OF SOURCES OF UNEXPLAINED IN VESTMENT AND ITA NO 1572 OF 2016 BIMAL KISHOR E SHARMA HYDERABAD. PAGE 4 OF 5 RESTRICTED THE DISALLOWANCE OF UNVOUCHED EXPENDITUR E TO RS.1.00 LAKH. AGGRIEVED BY THE ORDER OF THE CIT (A), THE AS SESSEE IS IN FURTHER APPEAL BEFORE US. 5. THE LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BY THE ASSESSEE BEFORE THE AUTHORI TIES BELOW AND SUBMITTED THAT THE ASSESSEE HAD OFFERED THE DIF FERENCE IN RECORDING OF INVESTMENT OF RS.6,24,763 TO TAX AND H AS PAID TAXES THEREON AND FURTHER ADDITION BY THE AO AMOUNTS TO D OUBLE TAXATION. 6. THE LEARNED DR, ON THE OTHER HAND, SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 7. HAVING REGARD TO THE RIVAL CONTENTIONS AND THE M ATERIAL ON RECORD, WE FIND THAT THE ASSESSEE DURING THE SUR VEY PROCEEDINGS, ADMITTED TO THE INVESTMENT OF RS.7,58, 263 AS AGAINST RS.1,33,500 REFLECTED IN THE SALE DEED AND HAS ALSO OFFERED THE DIFFERENCE TO TAX IN HIS RETURN OF INCOME AND PAID TAX THEREON, BUT DURING THE ASSESSMENT PROCEEDINGS, TRIED TO EXPLAIN THE SOURCE FOR THE SAID INVESTMENT. THE SOURCE FOR THE INVESTMENT IS EXPLAINED FROM THE RECORDS OF THE PROPRIETARY CONCERN. THE AO AND THE CIT (A) HAVE BOTH FAILED TO SEE THAT THE ASSESSEE HAS O FFERED THE DIFFERENCE BEING UNACCOUNTED INVESTMENT AS HIS INCO ME OF THE YEAR AND HAS PAID TAX THEREON AND FURTHER ADDITION WILL ONLY AMOUNT TO DOUBLE ADDITION WHICH IS NOT PERMISSIBLE UNDER LAW AND THEREFORE, IS LIABLE TO BE DELETED. GROUND OF A PPEAL NO.2 IS ACCORDINGLY ALLOWED. ITA NO 1572 OF 2016 BIMAL KISHOR E SHARMA HYDERABAD. PAGE 5 OF 5 8. WITH REGARD TO GROUND NO. 3, THE LEARNED COUNSEL FOR THE ASSESSEE HAS VEHEMENTLY REITERATED THE SUBMISSI ONS MADE BEFORE THE AUTHORITIES BELOW. HOWEVER, WE FIND THAT NO EVIDENCE WHATSOEVER, HAS BEEN FILED BEFORE THE AUTHORITIES B ELOW OR BEFORE EITHER TO SUBSTANTIATE HIS CLAIM. WHILE THE AO HAS MADE THE ADDITION OF THE ENTIRE EXPENDITURE CLAIMED BY THE A SSESSEE, THE CIT (A) RESTRICTED THE ADDITION TO RS.1.00 LAKH WHI CH IS QUITE REASONABLE. THEREFORE, WE DO NOT SEE ANY REASON TO INTERFERE WITH THE ORDER OF THE CIT (A) ON THIS ISSUE. THIS GROUND OF APPEAL IS ACCORDINGLY REJECTED. 9. IN THE RESULT, ASSESSEES APPEAL IS PARTLY ALLOW ED. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH NOVEMBER, 2017. SD/- SD/- (B. RAMAKOTAIAH) ACCOUNTANT MEMBER (P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD, DATED 15 TH NOVEMBER, 2017. VINODAN/SPS COPY TO: 1 B. NARSING RAO & CO. CAS, PLOT NO.554, ROAD NO.92 JUBILEE HILLS, HYDERABAD 500096 2 DCIT CIRCLE 16(2) HYDERABAD 3 CI T (A) - 4 HYDERABAD 4 PR. CIT 4 HYDERABAD 5 THE DR, ITAT HYDERABAD 6 GUARD FILE BY ORDER