ITO, CHENNAI V. Smt. R.Vasanthalakshmi, CHENNAI

ITA 1611/CHNY/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 64595 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 1 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-11-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 26-11-2012
• Assessment Year: 2008-2009
• Appeal Filed On: 04-10-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K E B RENGARAJAN JR
• Assessee Lawyers: S SRIDHAR
• Keywords: Business income; Revised return
• Section: 143(3); 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH CHENNAI BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI V. DURGA RAO, JUDICIAL MEMBER ------ ITA NO.1611/MDS/2011 ASSESSMENT YEAR : 2008-09 THE INCOME TAX OFFICER, BUSINESS WARD-II(2), CHENNAI. V. SMT. R. VASANTHALAKSHMI, NO.77, GREENWAYS ROAD, RAJA ANNAMALAIPURAM, CHENNAI-28. (PAN :ACFPV0154M) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI K.E.B. RENGARAJAN, JR. STANDING COUNSEL RESPONDENT BY : SHRI S. SRIDHAR, ADVOCATE DATE OF HEARING : 26-1 1-2012 DATE OF PRONOUNCEMENT : 26-11-201 2 O R D E R PER V. DURGA RAO, JUDICIAL MEMBER : THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST TH E ORDER OF THE CIT(APPEALS)-VI, CHENNAI DATED 21-07-2011 FO R THE ASSESSMENT YEAR 2008-09. ITA NO.1611/MDS /2011 2 2. BRIEF FACTS ARE THAT THE ASSESSEE HAD FILED RETU RN OF INCOME DECLARING TOTAL INCOME OF ` 34,709/-. THE RETURN WAS PROCESSED INITIALLY UNDER SECTION 143(1) OF THE INC OME TAX ACT, 1961 ('THE ACT' FOR SHORT). THEREAFTER, ASSESSMENT WAS COMPLETED UNDER SECTION 143(3) OF THE ACT DETERMINI NG THE TOTAL INCOME AT ` 72,61,930/-. IN THE ASSESSMENT ORDER THE ASSESSING OFFICER HAS OBSERVED THAT IN THE RETURN F ILED BY THE ASSESSEE FOR THE ASSESSMENT YEAR 2008-09 SHE HAS CL AIMED AN AMOUNT OF ` 72,27,223/- AS DEDUCTION UNDER SECTION 80-IB OF THE ACT. IN THE RETURN OF INCOME FILED THE ASSESSE E HAS CLAIMED TO HAVE DONE JOINT VENTURE WITH M/S. ARIHAN T HEIRLOOM AND ALSO CLAIMED TO HAVE THEIR LAND AT THAZAMBUR FO R JOINT VENTURE PURPOSE AND STATED THAT THE INCOME WAS DERI VED FROM HOUSE BUILDING AND DEVELOPMENT PROJECT. THE ASSESS EE HAS ALSO STATED THAT DEDUCTION 80-IB OF THE ACT WAS ALSO SUPPORTED BY REPORT AS PER FORM 10CCB. THE ASSESSING OFFICER FURTHER OBSERVED THAT IT IS PERTINENT TO POINT OUT THAT IT WAS ONLY AFTER ALL THE DETAILS IN SUPPORT OF CLAIM OF DEDUCTION U/ S 80-IB WERE CALLED FOR THAT THE ASSESSEE STATED THAT THE CLAIM U/S 80-IB WAS WRONGLY MADE. SO THE ASSESSEE HAS CHOSEN NOT T O FILE A REVISED RETURN TO MAKE ANY FRESH CLAIM. HENCE THE ASSESSEE ITA NO.1611/MDS /2011 3 HAS FALSELY CLAIMED DEDUCTION U/S 80-IB FOR WHICH TH E ASSESSEE IS NOT ELIGIBLE. THE ASSESSING OFFICER COMPLETED T HE ASSESSMENT ACCORDINGLY BY FOLLOWING THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. V. CIT (284 ITR 323) (SC). 3. THEREAFTER THE ASSESSEE CARRIED THE MATTER BEFOR E THE CIT(APPEALS). THE ASSESSEE SUBMITTED BEFORE THE LE ARNED CIT(APPEALS) THAT THE ASSESSEE IS A PARTNER IN THE PARTNERSHIP FIRM CALLED M/S. ARIHANT HEIRLOOM HAVING 21.20% SHA RE. THE SAID PARTNERSHIP FIRM FILED A RETURN WITH ITO, COMP ANY WARD- II(1), CHENNAI AND CLAIMED TOTAL INCOME OF ` 9,99,46,791/- CLAIMING DEDUCTION U/S 80-IB OF THE ACT. IT WAS S UBMITTED BEFORE THE LEARNED CIT(APPEALS) THAT DURING THE COU RSE OF SCRUTINY ASSESSMENT PROCEEDINGS THE ASSESSEE SUBMIT TED BEFORE THE ASSESSING OFFICER THAT THE INCOME RETURN ED BY THE ASSESSEE WAS IN FACT WITHDRAWAL OF SHARE OF PARTNER SHIP INCOME WHICH WAS RETURNED IN THE HANDS OF THE FIRM AND HENCE EXEMPT IN THE HANDS OF THE PARTNER U/S 10(2A) OF TH E ACT AND THE CASE LAW RELIED ON BY THE ASSESSING OFFICER IN THE CASE OF GOETZE (INDIA) LTD. V. CIT (SUPRA) HAS NO APPLICATI ON TO THE ITA NO.1611/MDS /2011 4 FACTS OF THE CASE. THE LEARNED CIT(APPEALS) AFTER CONSIDERING THE SUBMISSIONS MADE BY THE ASSESSEE OBSERVED AS UN DER : IT IS CLEAR THAT THE ASSESSEE HAS BEEN MISGUIDED BY THE EARLIER AR AND HENCE, FILED THE RETURN OF INCOME DISCLOSING PART OF SHARE INCOME FROM M/S. ARIHANT HEIRLOOM AS INCOME FROM BUSINESS. AS INCOME FROM PARTNERSHIP FIRM WHICH IS RETURNED IN THE HANDS OF THE PARTNERSHIP FIRM IS EXEMPT U/S 10(2A), IN THE HANDS OF THE PARTNER, THE SAME CANNOT BE AGAIN ASSESSED WHICH AMOUNTS TO DOUBLE TAXATION OF THE SAME INCOME. THE RELIANCE PLACED BY THE AO IN THE JUDGMENT OF GOETZ INDIA LIMITED ONLY APPLY IN CIRCUMSTANCES UNDER WHICH A FRESH CLAIM OF DEDUCTION IS REQUIRED TO BE MADE, THEN FILING OF REVISED RETURN BECOMES NECESSARY. HOWEVER, IN THIS CASE THE APPELLANT HAS WRONGLY OFFERED EXEMPTED INCOME UNDER THE HEAD BUSINESS AND THEREAFTER FURTHER COMPOUNDED THE MISTAKE BY CLAIMING THE DEDUCTION U/S 80-IB OF THE ACT. THEREFORE, THE DECISION RELIED ON BY THE AO IS NOT APPLICABLE TO THE FACTS OF THE CASE. CONSIDERING THE VARIOUS DECISIONS CITED BY THE AR IN HIS WRITTEN SUBMISSION, I DIRECT THE AO TO TREAT THE INCOME RETURNED BY THE APPELLANT AS SHARE INCOME U/S 10(2A) AS PROPERLY CLAIMED BY THE APPELLANT DURING ITA NO.1611/MDS /2011 5 ASSESSMENT BY SUBMITTING THE RELEVANT DOCUMENTS BEFORE THE AO AND ACCORDINGLY, I DELETE THE ADDITION OF ` 72,61,730/-. 4. ON BEING AGGRIEVED, THE REVENUE HAS CARRIED THE MATTER BEFORE THE TRIBUNAL. THE LEARNED DR SIMPLY SUPPORT ED THE ORDER PASSED BY THE ASSESSING OFFICER. 5. ON THE OTHER HAND, THE LEARNED COUNSEL FOR THE A SSESSEE STRONGLY SUPPORTED THE ORDER PASSED BY THE LEARNED CIT(APPEALS). 6. WE HAVE HEARD BOTH THE SIDES, PERUSED THE RECORD S AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE ASSESSEE IS A PARTNER IN THE PARTNERSHIP FIRM, M/S. ARIHANT HEIRLOOM HAVING SHARE OF 21.20%. IT IS AN ADMITTE D FACT THAT THE ASSESSEE HAS RECEIVED HER SHARE FROM THE PARTNE RSHIP FIRM. THE SAME WAS SHOWN IN HER RETURN AS BUSINESS INCOME AND WHEN THE SCRUTINY ASSESSMENT HAD TAKEN PLACE IT WAS SUBMITTED BEFORE THE ASSESSING OFFICER THAT THE SAI D INCOME WAS RECEIVED BY THE ASSESSEE FROM THE PARTNERSHIP F IRM AND THAT IT HAD ALREADY BEEN SHOWN IN THE HANDS OF THE FIRM AND THEREFORE IT COULD NOT BE TAXED AGAIN IN THE HANDS OF THE ASSESSEE U/S 10(2A) OF THE ACT. THE ASSESSING OFFI CER WITHOUT ITA NO.1611/MDS /2011 6 CONSIDERING THE SUBMISSIONS OF THE ASSESSEE SIMPLY SAID THAT THE ASSESSEE IS NOT ELIGIBLE FOR THE DEDUCTION U/S 80-IB CLAIM BY FOLLOWING THE DECISION IN THE CASE OF GOETZ (IND IA) LTD. (SUPRA) AND ADDED THE SAME AS INCOME AGAIN IN THE HANDS OF THE ASSESSEE. THE LEARNED CIT(APPEALS) HAS CATEGOR ICALLY HELD THAT M/S. ARIHANT HEIRLOOM HAS DISCLOSED THE ENTIRE INCOME INCLUDING THE INCOME RECEIVED BY THE ASSESSEE AND T HE INCOME RECEIVED FROM THE PARTNERSHIP FIRM IS EXEMPT U/S 10 (2A) OF THE ACT IN THE HANDS OF THE PARTNER AND IT COULD NOT BE TAXED IN THE HANDS OF THE PARTNER. NO MATERIAL WAS PRODUCED BY THE REVENUE TO CONTRADICT THE ABOVE FINDING GIVEN BY TH E LEARNED CIT(APPEALS). INSOFAR AS THE CASE LAW RELIED ON BY THE ASSESSING OFFICER IS CONCERNED, IT HAS NO APPLICATI ON TO THE FACTS OF THE CASE FOR THE SIMPLE REASON THAT THE AS SESSEE IS NOT ASKING FOR ANY FRESH CLAIM. IT IS ONLY A CASE WHER E SEC. 80-IB RELIEF WAS CLAIMED WRONGLY. IN VIEW OF THE ABOVE, WE FIND NO INFIRMITY IN THE ORDER PASSED BY THE LEARNED CIT(AP PEALS). THEREFORE, THIS GROUND OF APPEAL RAISED BY THE REVE NUE IS DISMISSED. 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ITA NO.1611/MDS /2011 7 ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ON THURSDAY, THE 26 TH OF NOVEMBER, 2012, AT CHENNAI. SD/- SD/- (ABRAHAM P. GEORGE) ( V.DURGA RAO ) ACCOUNTANT MEMBER JUDICIAL MEMBER CHENNAI, DATED THE 26 TH NOVEMBER, 2012. H. COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE