ACIT 16(1), MUMBAI V. DAISY A CHOKSI, MUMBAI

ITA 1823/MUM/2014

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 1871 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-12-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2010-2011
• Appeal Filed On: 14-03-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: LOVE KUMAR
• Assessee Lawyers: B P PUROHIT

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI . . , !' , # , $ BEFORE S/SHRI B.R.BASKARAN, ACCOUNTANT MEMBER AND AMARJIT SINGH, JUDICIAL MEMBER / I .T.A. NO.1823/MUM/2014 ( # % &% / ASSESSMENT YEAR: 2010-11) ASSISTANT COMMISSIONER OF INCOME TAX 16(1) 2 ND FLOOR, MATRU MADIR, TARDEO ROAD, MUMBAI 400007 / VS. SMT. DAISY A. CHOKSI 71-B, EMPIRE ESTATE, A.K.MARG, KEMPS CORNER, MUMBAI 400036 ./ ./ PAN/GIR NO. : ADNPC8835H ( / APPELLANT ) .. ( / RESPONDENT ) ASSESSEE BY: SHRI B.P. PUROHIT DEPARTMENT BY: SHRI LOVE KUMAR / DATE OF HEARING: 03.09.2015 /DATE OF PRONOUNCEMENT: 16.12.2015 ! / O R D E R PER AMARJIT SINGH, JM: THE REVENUE HAS FILED THE APPEAL AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-27, MUMBAI [HE REINAFTER REFERRED TO AS THE LEARNED CIT(A)] DATED 31.12.2013 RELEVANT TO THE A.Y. 2010-11. 2. THE ASSESSEE HAS FILED RETURN OF INCOME ON 15.10 .2010 DECLARING TOTAL INCOME AT RS.28,82,242/-. THE SAME WAS PROCESSED U /S. 143(1) OF THE ACT. THE CASE WAS SELECTED FOR SCRUTINY THROUGH CASS. NOTIC E U/S. 143(2) DATED 23.09.2011 WAS ISSUED AND SERVED UPON THE ASSESSEE ON 27.09.2011. ASSESSEE HAS SHOWED INTEREST AMOUNT RECEIVED TO THE TUNE OF RS.41,87,139/- AS PER FORM 26AS. THE ASSESSEE OFFERED AN AMOUNT TO THE TUNE O F RS.29,82,242/- FOR TAX. ITA NO.1823/MUM/2014 ASSESSMENT YEAR: 2010-11 2 THE ASSESSEE TOOK THE PLEA THAT AFTER DEATH OF HER HUSBAND IN 2005 THEY RECEIVED RS.90,00,000/- AS HIS SHARE IN GOODWILL OF THE FIRM OF SHRI AJAY K. CHOKSHI TO SMT. DAISY CHOKSHI AS HIS WIFE, SHRI JAHAN CHOKSHI AND SHRI YASH CHOKSHI AS HIS SONS. AT THE TIME OF FILING RETURN THE MINOR S ONS OF SHRI AJAY K. CHOKSHI BECAME ENTITLED TO THE AMOUNT WHICH HAS BEEN REFLEC TED IN FORM 26AS WAS NOT TAXABLE IN INCOME OF THE ASSESSEE. SHE RECEIVED T HIS AMOUNT ON BEHALF OF HER SONS IN FIDUCIARY CAPACITY BUT THE ASSESSING OFFICE R WAS NOT CONVINCED BY THE EXPLANATION RENDERED BY THE ASSESSEE AND THE AMOUNT TO THE TUNE OF RS.11,05,400/- DISTRIBUTED TO HER SONS WAS TREATED AS UNDISCLOSED INCOME. THE ASSESSEE FILED THE APPEAL BEFORE LEARNED CIT(A) WHO ALLOWED AND DELETED THE SAID ADDITIONS. ACCORDINGLY, BY THE SAID ORDER THE REVENUE IS IN THE APPEAL BEFORE TRIBUNAL. 3. WE HAVE HEARD THE ARGUMENTS ADVANCED BY THE LEAR NED REPRESENTATIVE OF THE PARTIES AND HAVE GONE THROUGH THE CASE FILE CAR EFULLY. IT HAS BEEN ARGUED ON BEHALF OF THE REVENUE THAT THE LEARNED CIT(A) HAS D ISTRIBUTED THE INTEREST INCOME OF THE ASSESSEE WITH HER SONS WITHOUT VERIFICATION OF AGE AND WITHOUT VERIFING THE FACTS THAT THE SONS OF THE SHRI AJAY K. CHOKSHI HAD RECEIVED ANY SPECIFIC AMOUNT AFTER HIS DEATH. THEREFORE, IT IS NECESSARY TO VERIFY THE AGE OF THE SONS OF THE SHRI AJAY K. CHOKSHI IN ORDER TO ALLOW THE CLA IM OF THE ASSESSEE WHILE COMPLETING THE ASSESSMENT OF THE RELEVANT YEAR. IT IS NOT DISPUTED THAT THE ASSESSEE RECEIVED THE INTEREST AMOUNT TO THE TUNE O F RS.41,87,139/- AS PER FORM 26AS. SHE ONLY OFFERED THE INTEREST INCOME TO THE T UNE OF RS.29,82,242/- FOR TAX. THE ASSESSEE EXPLAINED THAT SHE HAS PAID THE INTERE ST AMOUNT TO THE TUNE OF RS.11,05,400/- TO SHRI K.J. CHOKSHI, FATHER-IN-LAW OF ASSESSEE (RS.1,05,400/-), SHRI YASH CHOKSHI (RS.5,00,000/-) AND SHRI JAHAN CH OKSHI (RS.5,00,000/-) BOTH MAJOR SONS OF THE ASSESSEE. THEY RECEIVED THE AMOU NT TO THE TUNE OF RS.90,00,000/- ON ACCOUNT OF LEGACY OF SHRI AJAY K. CHOKSHI WHICH CAME INTO THE SHARE OF HER AS WELL AS HER TWO SONS TO THE EXT ENT OF 1/3 RD . ITA NO.1823/MUM/2014 ASSESSMENT YEAR: 2010-11 3 4. THE ASSESSEE CLAIM THAT HER SONS HAVE BECOME MAJ OR AND HENCE INTEREST PERTAINING TO THEIR SHARE IS ASSESSABLE IN THE RESP ECTIVE HAND OF SONS. THE QUESTION ABOUT THE AGE OF SONS HAS NOT BEEN EXAMINE D BY ASSESSING OFFICER. ACCORDINGLY, WE FIND MERIT IN THE CONTENTION OF THE LEARNED D.R. THAT THESE FACTS REQUIRE VERIFICATION. ACCORDINGLY, WE SET ASIDE TH E ORDER OF LEARNED CIT(A) AND RESTORE THE SAME TO THE FILE OF ASSESSING OFFICER W ITH THE DIRECTION TO EXAMINE THE AGE OF SONS AND THEIR SHARE IN CAPITAL INHERITE D. THE SHARE OF INCOME PERTAINING TO MAJOR SONS AND RELATED TDS SHOULD BE EXCLUDED FROM THE INCOME OF THE ASSESSEE. 7. IN RESULT THE APPEAL OF THE REVENUE IS HEREBY AL LOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH DECEMBER, 2015 SD/- SD/- (B.R.BASKARAN) (AMARJIT SINGH) / ACCOUNTANT MEMBER #$ /JUDICIAL MEMBER % & MUMBAI; ' DATED : 16 TH DECEMBER, 2015 MP MP MP MP ' ( )# !* +*& / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ( ) / THE CIT(A)- 4. ( / CIT 5. )*+ $$,- , ,- , % & / DR, ITAT, MUMBAI 6. +./ 0 / GUARD FILE. ' / BY ORDER, ) $ //TRUE COPY// , / ' (DY./ASSTT. REGISTRAR) , % & / ITAT, MUMBAI