ITO, Ward - 54(4), Kolkata, Kolkata V. Pinaki Chattopadhyay, Kolkata

ITA 1632/KOL/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 83239 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-12-2014
• Appeal Filed By: Department
• Bench Allotted: C
• Assessment Year: 2007-2008
• Appeal Filed On: 28-11-2011
• Court: TRIBUNAL
• Department Lawyers: K L KANAK
• Assessee Lawyers: N O N E

Judgement Text

, C , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: KOLKATA ( ) BEFORE , /AND , ) [BEFORE SHRI MAHAVIR SINGH, JM & SHRI SHAMIM YAHYA , AM ] / I.T.A NO. 16 32 /KOL/20 1 1 / ASSESSMENT YEAR : 200 7 - 0 8 INCOME - TAX OFFICER, WARD - 54 ( 4 ), KOLKATA. VS. PINAKI CHATTOPADHYAY ( PAN: A CMPC8135C ) ( /APPELLANT ) ( / RESPONDENT ) DATE OF HEARING: 26 . 1 2 .201 4 DATE OF PRONOUNCEMENT: 26 . 1 2 .201 4 FOR THE APPELLANT : S HRI K. L. KANAK, JCIT, SR. DR FOR THE RESPONDENT : N O N E / ORDER PER SHRI SHAMIM YAHYA, AM : THIS APPEAL BY REVENUE IS DIRECTED AGAINST THE ORDER OF CIT(A) DATED 15.09.2011 PERTAINS TO AY 2007 - 08. 2 . THE ISSUE RAISED IS THAT CIT(A) ERRED IN DELETING THE ADDITION OF RS.15,43,834/ - MADE BY AO ON ACCOUNT OF DRAFT CHARGES. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN ADVOCATE AND EXTENSIVELY DEALS IN PROPERTY MATTERS, I.E. RE GISTRATION OF IMMOVABLE PROPERTIES FOR AND ON BEHALF OF HIS CLIENTS. THE MODUS OPERATION INCLUDES PURCHASES OF DRAFTS FOR THE CLIENTS FOR PAYMENT OF STAMP DUTY AND REGISTRATION FEES AS PER GOVERNMENT RULES. DURING THE YEAR, THE ASSESSEE RECEIVED 52,45,40 0/ - FROM VARIOUS CLIENTS, AGAINST WHICH HE PURCHASED DRAFTS FOR STAMP DUTY FOR RS.52,24,463/ - AND PAID COMMISSION FOR DRAFT AT RS.20,767/ - . THE AO DISALLOWED 30% OF THE SAID RECEIPTS ON ESTIMATED BASIS WITH THE OBSERVATIONS AS FOLLOWS: THE ASSESSEE COUL D NOT PRODUCED ANY COUNTER PARTS OF THE BILLS OR MONEY RECEIPT. IT IS THE NORMAL PRACTICE THAT THE TRANSACTION OF ANY MONEY SHOULD BE EVIDENCED BY RECEIPT. THE ASSESSEE FAILED TO PRODUCE ANY EVIDENCE OF MONEY RECEIVED FOR PURCHASES OF DRAFT. HOWEVER, TH E ASSESSEE FILED XEROX COPY OF BANK SLIP IN FAVOUR OF PURCHASING BANK DRAFTS ALONG WITH A WORKING SHEET BUT THAT IS NOT TALLIED PROPERLY. HENCE IT IS NOT ESTABLISHED THE TOTAL AMOUNT RECEIVED BY THE ASSESSEE FOR PURCHASE OF BANK DRAFT AND THE ACTUAL AMOUN T OF BANK DRAFT PURCHASED. THEREFORE, 30% OF EXPENSES CLAIMED FOR DRAFT PURCHASE IS ADDED BACK TO THE TOTAL INCOME. 2 ITA NO.16 32 /KOL/2011 SHRI PINAKI CHATTOPADHYAY . AY 200 7 - 0 8 AGAINST THE SAID ORDER ASSESSEE PREFERRED APPEAL BEFORE CIT(A), WHO GRANTED RELIEF OF RS.15,43,834/ - BY HOLDING AS UNDER: I HAVE CONSIDERED THE SUBMISSION OF THE AR OF THE APPELLANT. THE AO DISALLOWED 30% OF THE EXPENSES INCURRED FOR PURCHASES OF DRAFTS ON WHIMS AND FANCY WITHOUT BRINGING ANY EVIDENCE ON RECORD TO THE CONTRARY. THEREFORE, THE ADDITION IS NOT MAINTAINABLE. AS PER THE LIST FILED BY THE AR, THE APPELLANT INCURRED TOTAL EXPENSES OF RS.52,54,249/ - FOR PURCHASES OF DRAFTS AND PAID RS.20,763/ - TOWARDS DRAFT CHARGES. HOWEVER, IN THE INCOME & EXPENDITURE ACCOUNT, THE APPELLANT SHOWED EXPENSES OF RS.52,24,463/ - FOR DRAFT P URCHASES AND RS.20,767/ - FOR DRAFT CHARGES. THUS, THE APPELLANT CLAIMED LESS EXPENSES TOWARDS PURCHASES OF DRAFTS TO THE EXTENT OF RS.29,786/ - (RS.52,54,249/ - MINUS RS.52,24,463/ - ). THE AR FAILED TO RECONCILE THE SAID DISCREPANCY. THEREFORE, AN AMOUNT O F RS.29,786/ - SHOULD BE ADDED AS UNACCOUNTED EXPENSES INCURRED BY THE APPELLANT FOR PURCHASES OF BANK DRAFTS. THUS, THE ADDITION TO THE EXTENT OF RS.29,786/ - IS UPHELD. THE APPELLANT GETS RELIEF AT RS.15,43,834/ - . AGAINST THAT ORDER, REVENUE IS IN APPE AL BEFORE US. 4 . WE HAVE HEARD LD. SR. DR MR. K. L. KANAK. NONE APPEARED ON BEHALF OF ASSESSEE. HOWEVER, IN OUR CONSIDERED OPINION THE ISSUE CAN BE DISPOSED OF BY PERUSING THE RECORDS AND HEARING THE LD. SR. DR. WE FIND THAT THE ASSESSEE IS AN ADVOCA TE, WHO EXTENSIVELY DEALS IN PROPERTY MATTER, I.E. REGISTRATION OF IMMOVABLE PROPERTIES FOR AND ON BEHALF OF CLIENTS. THE ASSESSEE PURCHASES DRAFTS FOR CLIENTS FOR PAYMENT OF STAMP DUTY AND REGISTRATION FEE AS PER GOVERNMENT RULES. THE AO DISALLOWED 30% OF THE EXPENDITURE IN THIS REGARD WITHOUT BRINGING ANY COGENT MATERIAL ON RECORD. LD. CIT(A) HAS GIVEN A FINDING THAT ASSESSEE S COUNSEL HAD SUBMITTED A LIST WHICH SHOWED THAT ASSESSEE INCURRED TOTAL EXPENSES OF RS.52,54,249/ - FOR PURCHASE OF DRAFTS AND P AID RS.20,763/ - TOWARDS DRAFT CHARGES. HOWEVER, NOTING SOME DISCREPANCIES IN THE AMOUNT ACTUALLY ENTERED IN THE INCOME & EXPENDITURE ACCOUNT, LD. CIT(A) HAS DISALLOWED RS.29,786/ - AND HAS GRANTED RELIEF OF RS.15,43,834/ - . IN OUR CONSIDERED OPINION, THE R ELIEF GRANTED BY LD. CIT(A) IS BASED ON COGENT MATERIAL AND THERE IS NO NEED TO INTERFERE IN THE ORDER OF CIT(A). ACCORDINGLY, WE UPHOLD THE SAME. 5. IN THE RESULT, APPEAL OF REVENUE IS DISMISSED. 6 . ORDER PRONOUNCED IN OPEN COURT . S D / - S D / - , , (MAHAVIR SINGH) ( SHAMIM YAHYA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 26 TH DECEMBER , 201 4 JD.(SR.P.S.) 3 ITA NO.16 32 /KOL/2011 SHRI PINAKI CHATTOPADHYAY . AY 200 7 - 0 8 - COPY OF THE ORDER FORWARDED TO: 1 . / A PPELLANT ITO, WARD - 54 ( 4 ), KOLKATA . 2 / RESPONDENT SHRI PINAKI CHATTOPADHYAY, NC - 36, ARJUNPUR, NORTH BAGUIATI, KOL - 700 059 . 3 . ( )/ THE CIT(A), KOLKATA 4. 5. / CIT KOLKATA / DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, / BY ORDER, /ASSTT. REGISTRAR .