ITO, Ward - 55(3), Kolkata, Kolkata V. Dr. Abdul Nister, Kolkata

ITA 1778/KOL/2011

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 7923 (ITAT-KOLKATA)
• Duration Of Justice: 7 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-08-2012
• Appeal Filed By: Department
• Bench Allotted: C
• Assessment Year: 2007-2008
• Appeal Filed On: 27-12-2011
• Court: TRIBUNAL
• Department Lawyers: RANJIT SAHA
• Assessee Lawyers: G R SAHA
• Keywords: Gift
• Section: 131

Judgement Text

, C , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: KOL KATA () BEFORE , /AND ! ' ! ! ' ! ! ' ! ! ' ! , ) [BEFORE SHRI PRAMOD KUMAR, AM & SHRI MAHAVIR SINGH, JM] # # # # / I.T.A NO. 1628/KOL/2011 '$% &' '$% &' '$% &' '$% &'/ // / ASSESSMENT YEAR : 2007-08 DR. ABDUL NISTER VS. INCOME-TAX OFFICER, WD-55 (3), KOLKATA. (PAN: ABIPN 1121C) ()* /APPELLANT ) (+)*/ RESPONDENT ) & # # # # / I.T.A NO. 1778/KOL/2011 '$% &' '$% &' '$% &' '$% &'/ // / ASSESSMENT YEAR : 2007-08 INCOME-TAX OFFICER, WD-55(3), KOLKATA. VS. DR. ABD UL NISTER ()* /APPELLANT ) (+)*/ RESPONDENT ) FOR THE ASSESSEE: SHRI G. R. SAHA FOR THE REVENUE: SHRI RANJIT SAHA DATE OF HEARING: 01.08.2012 DATE OF PRONOUNCEMENT: 03.08.2012 , / ORDER PER MAHAVIR SINGH, JM ( ! ' ! ! ' ! ! ' ! ! ' !, , , , ) THESE CROSS APPEALS BY ASSESSEE AND REVENUE ARE ARI SING OUT OF ORDER OF CIT(A)- XXXVI, KOLKATA IN APPEAL NO. 222/CIT(A)-XXXVI/KOL/W D.-55(3)/10-11 DATED 10.10.2011. ASSESSMENT WAS FRAMED BY ITO, WARD-55(3), KOLKATA U /S.143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR ASSESSME NT YEAR 2007-08 VIDE HIS ORDER DATED 31.12.2009. THE PENALTY IN DISPUTE WAS LEVIED BY I TO, WARD-55(3), KOLKATA U/S 271(1)(C) OF THE ACT VIDE HIS ORDER DATED 08/12/2010/10.12.2010. 2. FIRST WE TAKE UP ITA NO.1628/K/2011 (ASSESSEE S APPEAL). AT THE OUT SET, LD. COUNSEL FOR THE ASSESSEE STATED THAT THE QUANTUM APPEAL ON THE ADDITION OF INTEREST DISALLOWANCE OF RS.2,55,863/- AND GIFT RECEIVED OF RS.12 LAKH, TRIB UNAL IN ITA NO. 1336/K/2010 IN ASSESSEES OWN CASE FOR AY 2007-08 ORDER DATED 26.04.2012 ALLO WED THE CLAIM OF ASSESSEE VIDE PARAS 9 AND 13, WHICH ARE AS UNDER: 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PER USAL OF THE ASSESSMENT ORDER SHOWS THAT THE DISALLOWANCE OF THE INTEREST HAS BEEN MADE ONLY ON PRESUMPTION THAT THE CLAIM SEEMS TO BE HIGHLY EXCESSIVE AND ARBITRARY. NO EVID ENCE HAS BEEN FOUND THAT THE CLAIM AS HAS BEEN MADE BY THE ASSESSEE THAT THE LOANS HAV E BEEN TAKEN FOR ACQUIRING THE CHAMBER, IN WHICH HE IS CONDUCTING HIS PROFESSIONAL ACTIVITIES AS ALSO FOR PURCHASING THE VEHICLE IS FALSE. UNDISPUTEDLY, THE LOANS HAVE BEEN TAKEN FROM FINANCIAL INSTITUTIONS AND SUCH LOANS ARE ALSO REPAID ALONG WITH INTEREST TO T HE FINANCIAL INSTITUTIONS. IF THE INTEREST 2 ITA 1628-1778/K/2011DR. ABDUL NISTER A.Y. 07-08 IS PAID TO THE FINANCIAL INSTITUTIONS AND THE LOANS HAVE BEEN TAKEN FOR THE SAID PURPOSE FOR ACQUISITION OF THE CHAMBER AS ALSO THE VEHICLE AND THIS CLAIM IS SUPPORTED BY THE FACT OF THE LOANS HAVING BEEN TAKEN FROM THE FINANCIAL I NSTITUTIONS, JUST BECAUSE THE INTEREST EXPENDITURE SEEMS TO BE HIGHLY EXCESSIVE, THE SAME CANNOT BE DISALLOWED. IN THE CURCUMSTANCES, WE ARE OF THE VIEW THAT DISALLOWANCE OF THE INTEREST EXPENSES IS NOT ON A RIGHT FOOTING AND CONSEQUENTLY, THE SAME STANDS DEL ETED. 13. ON PERUSAL OF THE FACTS IN THE PRESENT CASE, IT CLEARLY SHOWS THAT THE ASSESSEE HAS IDENTIFIED THE DONORS. ALL THE DONORS HAVE CONFIRME D HAVING GIFTED THE RESPECTIVE AMOUNTS TO THE ASSESSEE. THE DONORS, WHO ARE ALSO C LOSE RELATIVES HAVE ALSO APPEARED BEFORE THE ASSESSING OFFICER AND THEIR STATEMENTS H AVE ALSO BEEN RECORDED BY THE ASSESSING OFFICER U/S. 131 OF THE ACT. NO EVIDENCE TO THE CONTRARY HAS BEEN FOUND. THE ASSESSING OFFICER HAS DISBELIEVED THE CLAIM OF GIFT S ONLY ON THE GROUND THAT THE CREDITWORTHINESS IS NOT ACCEPTABLE. HERE ONE SHOULD KEEP IN MIND THAT WHEN THE DONORS THEMSELVES HAVE ACCEPTED THE TRANSACTIONS, IF THE A SSESSING OFFICER DISBELIEVED THE DONOR(S), THEN IT WOULD VERY WELL BE OPEN TO THE AS SESSING OFFICER TO PROCEED FOR EXAMINATION OF THE SOURCE FOR MAKING THE GIFTS IN T HE HANDS OF THE DONOR. THE SAME CANNOT BE BLINDLY DISBELIEVED IN THE HANDS OF THE A SSESSEE, ESPECIALLY WHEN THE DONORS HAVE SPECIFICALLY AND CATEGORICALLY ADMITTED HAVING MADE THE GIFTS. IN THE CIRCUMSTANCES, ON MERITS, WE ARE OF THE VIEW THAT THE ADDITION ON ACCOUNT OF THE GIFTS RECEIVED BY THE ASSESSEE IS LIABLE TO BE DELETED AND WE DO SO. IN T HE CIRCUMSTANCES, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ACCORDINGLY, LD. COUNSEL FOR THE ASSESSEE STATED TH AT ONCE THE TRIBUNAL HAS DELETED THE QUANTUM ADDITION, PENALTY WILL NOT SURVIVE AND, THEREFORE, HE URGED BEFORE THE BENCH TO DELETE THE PENALTY. 3. LD. DR FAIRLY CONCEDED THE POSITION THAT THE TRI BUNAL HAS DELETED THE ADDITIONS ON THESE TWO COUNTS. WE FIND THAT THE TRIBUNAL HAS DELETED THESE TWO ADDITIONS AND HENCE, WE HAVE NO HESITATION IN DELETING THE PENALTY LEVIED BY AO AND CONFIRMED BY CIT(A). APPEAL OF ASSESSEE IS ALLOWED. 4. AS REGARDS TO REVENUES APPEAL I.E. ITA NO.1778/ K/2011, THE ONLY ISSUE IS REGARDING THE ACTION OF AO LEVYING MAXIMUM PENALTY @ 300%. SINC E THE QUANTUM ADDITIONS ARE DELETED AND WE HAVE ALLOWED THE ASSESEES APPEAL DELETING THE P ENALTY, THE APPEAL OF REVENUE HAS BECOME INFRUCTUOUS AND DISMISSED. 5. IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED AND THAT OF REVENUE IS DISMISSED 6. ORDER PRONOUNCED IN OPEN COURT ON 03.08.2012. SD/- SD/- , ! ! ! ! ' ! ' ! ' ! ' ! , (PRAMOD KUMAR) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER ( - - - -) )) ) DATED: 3 RD AUGUST, 2012 ./ '$01 '2 JD.(SR.P.S.) 3 ITA 1628-1778/K/2011DR. ABDUL NISTER A.Y. 07-08 , 3 ''4 54&6- COPY OF THE ORDER FORWARDED TO: 1 . )* / APPELLANT DR. ABDUL NISTER, 20/1/1M, BALLYGUNGE S TATION ROAD, KOLKATA-700 019. 2 +)* / RESPONDENT ITO, WARD-55(3), KOLKATA. 3 . ',$ ( )/ THE CIT(A), KOLKATA 4. ',$ / CIT, KOLKATA 5 . ='> '$ / DR, KOLKATA BENCHES, KOLKATA +4 '/ TRUE COPY, ,$/ BY ORDER, ! 1 /ASSTT. REGISTRAR .