The ACIT,Capi Circle, Vapi V. Shri Mehul Prakash Shah, Vapi

ITA 1757/AHD/2011

• Counselvise Citation: 175720514 RSA 2011
• Duration Of Justice: 4 year(s) 1 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-08-2015
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 10-08-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 04-07-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: DINESH SINGH
• Assessee Lawyers: MK PATELAR
• Section: 143(3)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND SHRI S. S. GODARA, JUDICIAL MEMBER ./ ITA NO. 1757/AHD/2011 / ASSESSMENT YEAR: 2008-09 ACIT, VAPI CIRCLE, VAPI VS. MEHUL PRAKASH SHAH, INNOVA INDUSTRIES, PLOT NO.785/1, 40 SHED AREA, GIDC, VAPI PAN : AEQPS 7357 Q / // / (APPELLANT) / // / (RESPONDENT) REVENUE BY : SHRI DINESH SINGH, SR. D.R. ASSESSEE(S) BY : SHRI M.K. PATEL, A.R. !' # $%&/ // / DATE OF HEARING : 10/08/2015 '( # $%& / // / DATE OF PRONOUNCEMENT: 14/08/2015 )* )* )* )*/ // / O R D E R PER G.D. AGRAWAL, VICE PRESIDENT: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS), VALSA D DATED 31.03.2011 FOR ASSESSMENT YEAR 2008-09. 2. THE FIRST GROUND OF THE REVENUES APPEAL READS A S UNDER:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW, THE LEARNED CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.16 L ACS MADE BY DISALLOWING DEDUCTION U/S 54EC OF THE I.T. ACT, 196 1. 3. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL PLACED BEFORE US. THE ASSESSING OFFICER DENIED THE DEDUCTI ON CLAIMED U/S ITA NO.1757/AHD/2011 ACIT VS. MEHUL PRAKASH SHAH FOR AY 2008-09 2 54EC TO THE ASSESSEE ON THE GROUND THAT AS PER CERT IFICATE ISSUED BY RURAL ELECTRIFICATION CORPORATION LIMITED (RECL) TH E DEPOSIT WAS BEYOND THE PRESCRIBED PERIOD. HOWEVER, THE CIT(A) A CCEPTED THE ASSESSEES CONTENTION ON THE GROUND THAT THE DEPOSI T WAS MADE BY THE ASSESSEE WITHIN THE PRESCRIBED TIME AND DELAY WAS O N ACCOUNT OF ISSUE OF BOND BY THE RECL. THE RELEVANT FINDING OF THE C IT(A) READS AS UNDER:- 5. DECISION: I HAVE PERUSED THE FACTS OF THE CASE AND THE SUBMISSION MADE BEFORE ME BY THE APPELLANT. THE SMALL POINT H ERE TO BE DECIDED IS WHAT SHOULD BE THE DATE OF INVESTMENT FOR THE PURPO SE OF SEC. 54EC I.E WHETHER THE DATE ON WHICH THE PAYMENT WAS MADE AND RECEIVED BY THE REC LIMITED OR THE DATE OF ISSUE OF BOND CERTIFICAT ES BY REC LIMITED? IN THE INSTANT CASE THE PAYMENT WAS MADE ON 03.01.2 008 AND A DEBIT WAS REFLECTED IN THE BANK ACCOUNT OF THE APPELLANT ON 04.01.2008. THE CERTIFICATE OF BOND WAS ISSUED BY THE REC LIMITED O N 31.01.2008 WHICH REFERS TO THE DATE OF ALLOTMENT AS 31.01.2008. HON ORBALE BOMBAY HIGH COURT IN THE CASE OF HINDUSTAN UNILEVER LIMITED V/S DCIT REPORTED IN 325 ITR 102 (BOM.) HELD INTER-ALIA THAT FOR THE PUR POSES OF THE PROVISIONS OF SEC. 54EC, THE DATE OF INVESTMENT BY THE ASSESSEE MUST BE REGARDED AS THE DATE ON WHICH PAYMENT WAS MADE AND RECEIVED BY THE NATIONAL HOUSING BANK. THIS WAS WITHIN A PERIOD OF SIX MONTHS FROM THE DATE OF TRANSFER OF THE ASSETS. I HAVE CAREFU LLY CONSIDERED THE FACTS OF THE INSTANT CASE AND THE RATIO OF THE JUDGMENT O F THE SAID BOMBAY HC. THERE IS NO DISPUTE THAT THE CHEQUES WERE ISSUE D ON 03.01.2008 AND DEBITED IN THE APPELLANTS A/C ON 04.01.2008. T HIS WAS WITHIN A PERIOD OF SIX MONTHS FROM THE DATE OF TRANSFER OF T HE ASSETS. THEREFORE, RESPECTFULLY FOLLOWING THE ABOVE REFERRED HC DECISI ON, THE AO IS DIRECTED TO ALLOW THE BENEFIT U/S 54EC BECAUSE THE DATE OF INVESTMENT BEING THE DATE ON WHICH PAYMENT WAS MADE AND RECEIV ED BY THE REC LTD AS HELD BY THE HONBLE HC. THIS GROUND IS ALLO WED. 4. AFTER CONSIDERING THE FACTS OF THE CASE AND ARGU MENTS OF BOTH THE SIDES, WE ENTIRELY AGREE WITH THE ORDER OF THE CIT( A). ADMITTEDLY, THE ASSESSEE DEPOSITED THE MONEY IN TIME WITH THE REC L TD. HOWEVER, IT ITA NO.1757/AHD/2011 ACIT VS. MEHUL PRAKASH SHAH FOR AY 2008-09 3 WAS REC LTD WHO TOOK TIME TO ISSUE THE CERTIFICATE OF THE BOND. THE RESPONSIBILITY OF THE ASSESSEE IS TO MAKE INVESTMEN T WITH REC LTD WITHIN TIME, WHICH WAS ADMITTEDLY MADE. THE ASSESS EE HAS NO CONTROL OVER THE ISSUE OF THE CERTIFICATE BY THE REC LTD. IN VIEW OF ABOVE, WE DO NOT FIND ANY JUSTIFICATION TO INTERFERE WITH THE ORDER OF THE CIT(A) IN THIS REGARD AND THE SAME IS SUSTAINED. 5. GROUND NO.2 OF THE REVENUES APPEAL READS AS UND ER:- 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.11 L ACS MADE BY ESTIMATING THE HOUSE-HOLD WITHDRAWALS OF THE ASSESS EE, BASED ON THE WITHDRAWALS MADE FOR THE MONTH OF MARCH, 2011. 6. THE FACTS OF THE CASE ARE THAT THE ASSESSEE HAS DISCLOSED ONLY A SUM OF RS.1,20,000/- FOR HOUSE-HOLD EXPENSES. THE ASSESSING OFFICER CONSIDERED THE WITHDRAWALS TO BE INADEQUATE. HE MA DE THE ADDITION OF RS.11,00,000/- FOR LOW WITHDRAWAL OF THE HOUSE-H OLD EXPENSES. ON APPEAL, THE CIT(A) DELETED THE SAME. 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL PLACED BEFORE US. CONSIDERING THE FACTS OF THE CASE AND A RGUMENTS OF BOTH THE SIDES, WITHDRAWAL OF RS.10,000/- PER MONTH FOR HOUS E-HOLD EXPENDITURE CANNOT BE SAID TO BE ADEQUATE OR REASON ABLE WITHDRAWAL, THOUGH THE ESTIMATE BY THE ASSESSING OFFICER AT RS. 1,00,000/- PER MONTH IS ALSO EXCESSIVE. IN OUR OPINION, IT WOULD MEET THE ENDS OF JUSTICE IF THE HOUSE-HOLD EXPENDITURE IS ESTIMATED AT RS.25,000/- PER MONTH, I.E., RS. 3,00,000/- PER ANNUM. THEREFORE, A FTER CONSIDERING THE ITA NO.1757/AHD/2011 ACIT VS. MEHUL PRAKASH SHAH FOR AY 2008-09 4 WITHDRAWAL OF RS.1,20,000/- PER MONTH, THE ADDITION IS SUSTAINED AT RS.1,80,000/-. 8. BEFORE WE TAKE UP ANOTHER GROUND, WE WOULD LIKE TO DEAL WITH THE FEW ARGUMENTS RAISED BY THE LD. COUNSEL FOR THE ASSESSEE WHILE CONSIDERING THIS GROUND OF APPEAL. IT WAS CONTENDED BY HIM THAT THE WITHDRAWAL IS MORE THAN THE WITHDRAWAL BY THE ASSES SEE IN THE IMMEDIATELY PRECEDING YEAR. HOWEVER, THE LD. COUNS EL FOR THE ASSESSEE HAS NOT SHOWN THAT THE ASSESSMENT OF THE E ARLIER YEAR WAS COMPLETED U/S 143(3) AND IN THAT ASSESSMENT THE ISS UE OF REASONABLENESS OR OTHERWISE OF THE WITHDRAWAL FOR H OUSE-HOLD EXPENDITURE WAS CONSIDERED. THEREFORE, IN OUR OPINI ON, THERE WAS NO RES ADJUDICATA FOR THE ASSESSING OFFICER FOR CONSIDERING THE REASONABLENESS FOR THE HOUSE-HOLD EXPENDITURE IN TH IS YEAR. IT WAS ALSO CONTENDED BY THE LD. COUNSEL THAT THE ASSESSING OFF ICER MADE THE ADDITION MERELY ON THE BASIS OF ESTIMATE. IN OUR OP INION, WHEN NO DAY TO DAY DETAILS OF EXPENDITURE OF THE HOUSE-HOLD IS MAINTAINED BY THE ASSESSEE, THEN NATURALLY BY THE VERY NATURE OF THE EXPENDITURE IT HAS TO BE DETERMINED ON ESTIMATE BASIS. ACCORDINGLY, WE P ARTLY REVERSE THE ORDER OF THE CIT(A) IN THIS REGARD AND SUSTAIN THE ADDITION OF RS.1,80,000/- FOR LOW WITHDRAWAL OF HOUSE-HOLD EXPE NDITURE. 9. GROUND NO.3 OF THE REVENUES APPEAL READS AS UND ER:- 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE LEARNED CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.2 LA CS MADE BY THE AO ON ACCOUNT OF DIFFERENCE OF THE AMOUNT OF SALE CONS IDERATION IN RESPECT OF SALE OF LAND BY THE ASSESSEE. ITA NO.1757/AHD/2011 ACIT VS. MEHUL PRAKASH SHAH FOR AY 2008-09 5 10. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL PLACED BEFORE US. ADMITTEDLY, THE ASSESSEE HAD TRANSFERRE D IMMOVABLE PROPERTY FOR THE SUM OF RS.32,00,000/-. COPY OF THE SALE DEED IS PLACED ON RECORD. AS PER SALE DEED, THE BUYER AS PER DIREC TION OF THE ASSESSEE MADE THE PAYMENT TO SHREE BALAJI TRADING CO.S PROP RIETOR MS. MAYA GARG. IT WAS THE CONTENTION OF THE ASSESSEE THAT MS . MAYA GARG MADE THE PAYMENT OF RS.30,00,000/- TO THE ASSESSEE. AS P ER SECTION 48, CAPITAL GAIN IS TO BE COMPUTED ON THE FULL VALUE OF THE CON SIDERATION RECEIVED OR ACCRUED AS A RESULT OF TRANSFER OF THE CAPITAL A SSET. ADMITTEDLY, THE FULL VALUE OF THE CONSIDERATION ACCRUED WAS RS.32,0 0,000/-. PAYMENT TO MS. MAYA GARG, PROPRIETOR OF SHREE BALAJI TRADING C O. WAS GIVEN AS PER THE DESIRE OF THE ASSESSEE. THAT, MERELY BECAUS E THE ASSESSEE COULD RECEIVE ONLY THE PART MONEY FROM MS. MAYA GARG WOUL D BE NO GROUND FOR REDUCING THE FULL VALUE OF THE CONSIDERATION FO R THE PURPOSE OF SECTION 48. WE, THEREFORE, REVERSE THE ORDER OF TH E CIT(A) IN THIS REGARD AND RESTORE THAT OF ASSESSING OFFICER. THUS, GROUND NO.3 OF THE REVENUES APPEAL IS ALLOWED. 11. IN THE RESULT, REVENUES APPEAL IS PARTLY ALLOW ED. ORDER PRONOUNCED IN THE COURT ON 14 TH AUGUST, 2015 AT AHMEDABAD. SD/- SD/- (S. S. GODARA) JUDICIAL MEMBER (G.D. AGRAWAL) VICE-PRESIDENT AHMEDABAD; DATED 14/08/2015 BIJU T., PS ITA NO.1757/AHD/2011 ACIT VS. MEHUL PRAKASH SHAH FOR AY 2008-09 6 )* # $+ ,)+$ )* # $+ ,)+$ )* # $+ ,)+$ )* # $+ ,)+$/ COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. $ !- / CONCERNED CIT 4. !- ( ) / THE CIT(A) 5. +01 $ , , / DR, ITAT, AHMEDABAD 6. 13 4' / GUARD FILE . )*! )*! )*! )*! / BY ORDER, TRUE COPY 5 55 5/ // / 6 6 6 6 ( DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD