Alka Narsaria, Ranchi V. ITO,Ward-1(1), Ranchi

ITA 172/RAN/2019

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 1693 (ITAT-RANCHI)
• Duration Of Justice: 1 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2015-2016
• Appeal Filed On: 15-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P.K. MONDAL
• Assessee Lawyers: AJAY PODDAR
• Keywords: Unexplained cash credit; Unexplained investment; Retrospective amendment; Set aside
• Section: 68; 69C; 142(1); 201; 20

Judgement Text

, . . , IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH , RANCHI , BEFORE SHRI CHANDRA MOHAN GARG, JUDICIAL MEMBER ./ ITA NO. 172 / RAN /20 1 9 ( / ASS ESSMENT YEAR : 20 1 5 - 20 1 6 ) ALKA NARSARIA, SHRADHANAND ROAD, UPPER BAZAR RANCHI C/O SRI JAGMOHAN PODDAR, ADVOCATE, SHREE MAHADEO COMPLEX, 10, SHRADHANAND ROAD, RANCHI - 834001 VS. ITO, WARD - 1(1), RANCHI ./ ./ PAN/GIR NO. : A BPPN 8179 F ( / APPELLANT ) .. ( / RESPONDENT ) /AS SESSEE BY : SHRI AJAY PODDAR, ADVOCATE /REVENUE BY : SHRI P.K.MONDAL , ACIT( DR ) / DATE OF HEARING : 2 1 / 0 5 /201 9 / DATE OF PRONOUNC EMENT 24 / 0 5 /201 9 / O R D E R THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS), RANCHI , JHARKHAND, DATED 18.01.2019 PASSED IN FIRST APPEAL NO. CIT(A), RANCHI/10 273 /201 7 - 1 8 FOR THE ASSESSMENT YEA R 201 5 - 201 6 . 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : - 1. FOR THAT THE ASSESSMENT ORDER AS WELL AS EX - PARTE APPELLATE ORDER PASSED U/S.143(3) OF THE I.T.ACT, 1961 FOR THE ASSESSMENT YEAR 2015 - 16 IS WHOLLY WITHOUT JURISDICTION, CONTRARY TO LAW AND AGAINST THE FACTS ON RECORD. 2. FOR THAT, THE ADDITION OF RS.8,65,270.00 AS UNEXPLAINED CASH CREDITS U/S.68 READ WITH SECTION 115BE OF THE ACT IS ILLEGAL, ARBITRARY AND BAD IN LAW. 3. FOR THAT THE ASSESSEE VOLUNTARILY SURRENDERED THE LONG T ERM CAPITAL GAIN FOR TAXATION AS INCOME FROM OTHER SOURCES AND PAID ITA NO. 172 / RAN /201 9 2 THE TAX AMOUNT THEREFORE THE ADDITION U/S.68 READ WITH SECTION 115BE IS NOT JUSTIFIED. 4. FOR THAT CHARGING OF INTEREST U/S.234B & C ON THE ASSESSED INCOME IS IN CONTRARY TO LAW IN VIEW OF THE DECISION OF HONBLE JHARKHAND HIGH COURT IN THE CASE OF AJAY PRAKASH VERMA DATED 25.07.2012 IN TAX APPEAL NO.38 OF 2010 REPORTED IN 2013 (1) JCR 580 (JHR.) RELYING UPON SMT. TEJ KUMARI VRS. CIT(2001) 114 TAXMAN 404 (PAT)(FB) CONFIRMED BY HONBLE SUP REME COURT VIDE ORDER DATED 01.08.2000 WHEREIN INTER ALIA, IT HAS BEEN HELD THAT INTEREST CAN BE CHARGED ON THE RETURNED INCOME ONLY AND NOT ON THE ASSESSED INCOME. 5 . FOR THAT ANY OTHER GROUND OR GROUNDS , RELIEFS MAY BE URGED AT THE TIME OF HEARING . RE LIEF SOUGHT FOR : - THAT THE ASSESSMENT ORDER AS WELL AS EXPARTE APPELLATE ORDER MAY BE FULLY SET ASIDE/QUASHED AS THE SAME IS ENTIRELY ILLEGAL, ARBITRARY, BASELESS & WHOLLY WITHOUT JURISDICTION. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED THE R ETURN OF INCOME DECLARING TOTAL INCOME OF RS.5,47,900/ - ON 08.03.2016., WHICH WAS PROCESSED AND SELECTED FOR SCRUTINY AND NOTICES U/S.143(2) & 142(1) OF THE ACT WERE ISSUED BY THE ASSESSING OFFICER TO THE ASSESSEE. ACCORDINGLY, THE AUTHORISED REPRESENTATIVE OF THE ASSESSEE APPEARED BEFORE THE ASSESSING OFFICER AND THE ASSESSING OFFICER AFTER VERIFICATION OF NECESSARY DETAILS, ASSESSED THE TOTAL INCOME OF THE ASSESSEE AT RS. 14,13,170/ - MAKING ADDITION OF RS.8,65,270/ - U/S.68 R.W.S.115BBE OF THE ACT ON ACCOUNT OF UNEXPLAINED CASH CREDITS. AGAINST WHICH THE ASSESSEE CARRIED THE MATTER TO THE CIT(A). IN THE APPELLATE PROCEEDINGS THE CIT(A) UPHELD THE ACTION OF AO AND DISMISSED THE APPEAL OF THE ASSESSEE 4. AGGRIEVED BY THE ORDER OF CIT(A), NOW THE ASSESSEE IS IN FURTHER APPEAL BEFORE THE TRIBUNAL. ITA NO. 172 / RAN /201 9 3 5. LD. AR SUBMITTED THAT THE ASSESSEE DOES NOT WANT TO PRESS THE GROUND NO. 1. HENCE THE SAME IS DISMISSED AS NOT PRESSED. 6. THE REMAINING EFFECTIVE GROUND OF ASSESSEE IS THAT THE ASSESSEE VOLUNTARILY SURRENDERED THE L ONG TERM CAPITAL GAIN FOR TAXATION AS INCOME FROM OTHER SOURCES AND PAID THE TAX AMOUNT, THEREFORE, THE AUTHORITIES BELOW WERE NOT CORRECT IN MAKING FURTHER ADDITION AND TAXING THE SAME UNDER SECTION 68 READ WITH SECTION 115BBEOF THE INCOME TAX ACT 1961 ( IN SHORT THE ACT ) AS THE PROVISION OF SECTION 115 BBE OF THE ACT IS OPERATIONAL WITH EFFECT FROM 01.04.2017 AND THE SAME CAN BE APPLIED TO THE PRESENT CA SE PERTAINING TO A. Y. 2015 - 20 16. 7 . I HAVE HEARD THE RIVAL SUBMISSIONS OF BOTH THE SIDES AND CAREFUL LY PERUSED THE RELEVANT MATERIAL PLACED IN THE RECORD OF THE TRIBUNAL . THE LD. AR SUBMITTED THAT WHEN THE ASSESSEE VOLUNTARILY SURRENDERED LONG TERM CAPITAL GAIN FOR TAXATION AS INCOME FROM OTHER SOURCES AND HAS PAID THE TAX THEREON THEN THE AUTHORITIES BE LOW WERE NOT CORRECT IN CHARGING THE TAX TREATING THE ADDITION U/S.68 R.W.S.115BBE OF THE ACT AS THE PROVISION OF SECTION 115BBE IS NOT APPLICABLE FOR THE PRESENT A.Y.2015 - 2016 AND THE SAME IS APPLICABLE W.E.F.01.04.2017 FOR THE ASSESSMENT YEAR 2017 - 2018. LD. AR ALSO SUBMITTED COPIES OF THE ASSESSMENT ORDERS FOR A.Y.2015 - 2016 IN CASE OF SHRI MANOJ KAPOOR, ORDER DATED 30.11.2017 AND SUBMITTED THAT IN THE IDENTICAL FACTS OF THE CASE, THE AO MADE ADDITION U/S.69 OF THE ACT ON ACCOUNT OF UNEXPLAINED INVESTMENT AND CHARGED THE TAX AS PER PRE - AMENDED SUB - SECTION 1 OF SECTION 115BBE, THEREFORE, THE ITA NO. 172 / RAN /201 9 4 REVENUE AUTHORITIES CANNOT GIVE DIFFERENT TREATMENT TO THE DIFFERENT ASSESSEES ON SIMILAR ISSUE. 8. REPLYING TO THE ABOVE, LD. DR HAS STRONGLY SUPPORTED THE ACTION OF A O AND SUBMITTED THAT WHILE THE ASSESSMENT ORDER HAS BEEN FRAMED AFTER AMENDMENT OF SUB - SECTION 1 TO SECTION 115BBE OF THE ACT, THEN VOLUNTARILY SURRENDERED AMOUNT HAS TO BE TAXED ACCORDINGLY AS PER AMENDED PROVISION. 9. ON CAREFUL CONSIDERATION OF ABOVE SU BMISSIONS, FIRST OF ALL, I MAY OBSERVE THAT IN CASE OF SHRI MANOJ KUMAR (SUPRA) IN THE ASSESSMENT ORDER 30.11.2017 THE ADDITION MADE U/S.69 OF THE ACT ON ACCOUNT OF UNEXPLAINED INVESTMENT AND IN THE LAST PARA AND AS PER THE CALCULATION SHEET THE PROVISIONS OF SECTION 115BBE OF THE ACT HAS NOT BEEN APPLIED TO THIS CASE, WHEREAS FROM PARA 3.12 OF THE ASSESSMENT ORDER PASSED BY THE AO IN THE PRESENT CASE, I OBSERVE THAT THE AO HAS NOTED THAT THE TOTAL INCOME OF THE ASSESSEE IS ASSESSED U/S.68 R.W.S.115BBE OF T HE ACT. 10. IN MY HUMBLE UNDERSTANDING OF THE SUB - SECTION (1) OF SECTION 115BBE OF THE ACT, I NOTE THAT THIS PROVISION HAS BEEN SUBSTITUTED BY THE TAXATION LAWS (SECOND AMENDMENT) ACT, OUT OF 2016 W.E.F. 01.04.2017 AND PRIOR TO THIS SUBSTITUTION SUB - SECTI ON (1) OF SECTION 115BBE READS AS UNDER : - (1) WHERE THE TOTAL INCOME OF AN ASSESSEE INCLUDES ANY INCOME REFERRED TO IN SECTION 68, SECTION 69, SECTION 69A, SECTION 69B, SECTION 69C OR SECTION 69D, ,THE INCOME - TAX PAYABLE SHALL BE THE AGGREGATE OF (A) T HE AMOUNT OF INCOME - TAX CALCULATED ON INCOME REFERRED TO IN SECTION 68, SECTION 69, SECTION 69A, SECTION 69B, SECTION 69C OR SECTION 69D, AT THE RATE OF THIRTY PER CENT; AND ITA NO. 172 / RAN /201 9 5 (B) THE AMOUNT OF INCOME - TAX WITH WHICH THE ASSESSEE WOULD HAVE BEEN CHARGEABLE HA D HIS TOTAL INCOME BEEN REDUCED BY THE AMOUNT OF INCOME REFERRED TO IN CLAUSE(A) 11. ON CAREFUL AND VIGILANT PERUSAL OF THE PRE - AMENDED PROVISION, THE AMENDMENT AND POST AMENDMENT PROVISION, I CLEARLY OBSERVE THAT THERE IS NO INTENTION OF THE LEGISLATION TO GIVE EFFECT TO THE AMENDED PROVISION SUB - SECTION (1) TO SECTION 115BBE WITH RETROSPECTIVE EFFECT AND THIS PROVISION PROVIDES THAT THE AMOUNT OF INCOME - TAX CALCULATED ON THE INCOME REFERRED TO IN CLAUSE(A) AND CLAUSE(B) OF SUB - SECTION (1) OF SECTION 115 BBE OF THE ACT SHALL BE CHARGED @60% MEANING THEREBY THE RATE OF TAX HAS BEEN ENHANCED FROM 30% TO 60% BY WAY OF THIS AMENDMENT W.E.F. 01.04.2017. IN VIEW OF THE DECISION OF HON BLE FIVE JUDGES BENCH OF HON BLE SUPREME COURT IN THE CASE OF CIT VS. VATIKA T OWNSHIP PRIVATE LIMITED, (2014) 367 ITR 466 (SC) , THE PROVISION ENHANCING THE TAX RATE CANNOT BE GIVEN RETROSPECTIVE EFFECT IN ABSENCE OF ANY CLEAR MANDATE OF LEGISLATION . IN MY CONSIDERED VIEW, THE SAID AMENDED PROVISION OF SUB - SECTION (1) OF SECTION 115B BE OF THE ACT HAS BEEN GIVEN EFFECT FROM A FUTURE DATE WHICH IS 01.04.2017 . THEREFORE, IN MY HUMBLE AND CONSIDERED VIEW THE AMENDED PROVISION OF SECTION 115BBE OF THE ACT IS APPLICABLE FROM 01.04.2017 AND THE SAME MAY BE APPLIED FROM THE ASSESSMENT YEAR 20 1 7 - 201 8 AND ONWARDS AND NOT TO THE PRESENT CASE WHICH IS PERTAINING TO ASSESSMENT YEAR 2015 - 2016 . OBVIOUSLY, IN THESE CIRCUMSTANCES , THE PRESENT CASE WOULD BE GOVERNED BY THE PRE - AMENDED SUB - SECTION (1) TO SECTION 115BBE OF THE ACT WHICH WAS EFFECTIVE AND APPLICABLE TO A.Y.2015 - 2016 . ITA NO. 172 / RAN /201 9 6 12. IN VIEW OF THE FOREGOING DISCUSSIONS, THE ADDITION MADE BY THE AO U/S.68 OF THE ACT ON VOLUNTARILY SURRENDERED AMOUNT BY THE ASSESSEE IS UPHELD AND THE AO IS DIRECTED TO CALCULATE THE INTEREST PAID THEREON AS PER PRE - AMEND ED PROVISION OF SECTION SUB - SECTION (1) OF 115BBE OF THE ACT APPLICABLE TO THE RELEVANT ASSESSMENT YEAR 2015 - 2016. 1 3 . IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED WITH THE DIRECTIONS TO THE AO AS INDICATED ABOVE. O RDER PRONOUNCED IN THE OPEN COURT ON 24 / 05 / 201 9 . SD/ - ( CHANDRA MOHAN GARG ) / JUDICIAL MEMBER / RANCHI ; DATED 24 / 05 /201 9 PRAKASH KUMAR MISHRA , S R.P.S. / COPY OF THE ORDER FORWARDED TO : / BY ORDER, ( SENIOR PRIVATE SECRETARY ) , / ITAT, RANCHI 1. / THE APPELLANT - . ALKA NARSARIA, SHRADHANAND ROAD, UPPER BAZAR RANCHI C/O SRI JAGMOHAN PODDAR, ADVOCATE, SHREE MAHADEO COMPLEX, 10, SHRADHANAND ROAD, RANCHI - 834001 2. / THE RESPONDENT - ITO, WARD - 1(1), RANCHI 3. ( ) / THE CIT(A), 4. / CIT 5. , , / DR, ITAT, RANCHI 6. / GUARD FILE. //TRUE COPY//