ACIT, CHENNAI V. Shri Haresh Dhruva, CHENNAI

ITA 1832/CHNY/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 5138 (ITAT-CHENNAI)
• Duration Of Justice: 6 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-05-2011
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 02-05-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 28-10-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: K E B RENGARAJAN JR
• Assessee Lawyers: N MUTHUKUMARAN
• Keywords: Set aside
• Section: 143(3); 69B; 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BENCH B, CHENNAI (BEFORE DR.O.K.NARAYANAN, VICE PRESIDENT AND SHRI GEORGE MATHAN, JUDICIAL MEMBER) .. I.T.A.NO.1832(MDS)2010 ASSESSMENT YEAR : 2007-08 THE ASSISTANT COMMISSIONER OF INCOME-TAX,CIRCLE VIII CHENNAI. (APPELLANT) V. SHRI HARESH DHRUVA, 123, THAMBU CHETTY ST., CHENNAI-600 001. PAN AABPH1305A. (RESPONDENT) APPELLANT BY: SHRI K.E.B.RENGARAJAN, JR. STANDING COUNSEL RESPONDENT BY: SHRI N.MUTH UKUMARAN O R D E R PER DR.O.K.NARAYANAN, VICE PRESIDENT THIS APPEAL IS FILED BY THE REVENUE FOR THE ASSESSMENT YEAR 2007-08. THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER(APPEALS)-IX, CHENNAI DATED 30-7-2010 A ND ARISES OUT OF THE ASSESSMENT COMPLETED UNDER SECTION 143(3) OF THE INCOME-TAX ACT, 1961. 2. THE FIRST GROUND RAISED BY THE REVENUE I S THAT THE COMMISSIONER(APPEALS) HAS ERRED IN DELETING THE ADD ITION OF ` .35 ITA N O.1832(MDS)/2010 2 LAKHS MADE BY THE ASSESSING AUTHORITY UNDER SECTION 69B OF THE ACT. THE ADDITION HAS BEEN MADE AGAINST UNEXPLAINED INVE STMENT STATED TO BE MADE BY THE ASSESSEE IN MUTUAL FUNDS. 3. THE SECOND GROUND RAISED BY THE REVENU E IS THAT THE COMMISSIONER(APPEALS) HAS ERRED IN DELETING THE ADD ITION OF ` .3 LAKHS MADE BY THE ASSESSING AUTHORITY UNDER SECTION 69 OF THE ACT. 4. THE COMMISSIONER(APPEALS) HAS CO NSIDERED THE ABOVE TWO ITEMS TOGETHER IN HIS ORDER TREATING THE TOTAL AMOUNT TO ` .38 LAKHS. 5. IN RESPECT OF THE ADDITION OF ` .35 LAKHS THE COMMISSIONER(APPEALS) HAS EXAMINED THE DETAILS IN A MINUTE MANNER IN THE LEDGER ACCOUNT MAINTAINED BY THE ASSESSEE. IT WAS CONTENDED BEFORE THE COMMISSIONER(APPEALS) THAT THE ASSESSEE HAS MADE AN AGGREGATE INVESTMENT OF ` .33,75,000/- IN HDFC CASH MANAGEMENT SCHEME. THE SAID SCHEME GREW TO ` .35,22,207.71 ON ACCOUNT OF INTEREST AND DIVIDENDS. THUS OUT OF THE ABOVE SUM OF ` .35,22,207.71, THE ASSESSEE HAS SWITCHED OVER TO HDFC FMP FUND A S UM OF ` .35 LAKHS. THEREFORE, AS RIGHTLY POINTED OUT BY THE COMMISSIONER(APPEALS), IT WAS NOT NECESSARY FOR THE ASSESSEE TO INFUSE FRESH CAPITAL OR MONEY TO MAKE THE SAID INVE STMENT OF ` .35 LAKHS. THE SAID INVESTMENT HAS BEEN MADE BY CONVER TING THE ALREADY ITA N O.1832(MDS)/2010 3 EXISTING INVESTMENT ACCOUNT. AS THE MATTER HAS BEE N CLEARLY PROVED, WE FIND THAT THE COMMISSIONER(APPEALS) HAS RIGHTLY DELETED THE ADDITION OF ` .35 LAKHS. 6. EVEN THOUGH THE COMMISSIONER(APP EALS) HAS STATED THAT HE HAS CONSIDERED THE TWO ADDITIONS OF ` .35 LAKHS AND ` .3 LAKHS SIMULTANEOUSLY, HE HAS NOT RECORDED ANY FINDING IN RESPECT OF THE ADDITION OF ` .3 LAKHS. HE HAS EXAMINED THE REASONS AND HAS COME TO AN ACCEPTABLE CONCLUSION TO DELETE THE ADDITION ONL Y IN RESPECT OF THE SUM OF ` .35 LAKHS. NO SUCH FINDING IS RECORDED IN RESPECT OF ` .3 LAKHS. BUT WHILE PASSING THE ORDER HE HAS DELETED THE ENTIRE AMOUNT OF ` .38 LAKHS AS IF HE HAS CONSIDERED THE SUM OF ` .3 LAKHS ALSO ALONGWITH THE SUM OF ` .35 LAKHS. BUT IT IS NOT CORRECT. THE FACT REMAINS THAT THE COMMISSIONER(APPEALS) HAS NOT EXAM INED ANYTHING IN RESPECT OF THE ADDITION OF ` .3 LAKHS. 7. IT WAS THE CONTENTION OF THE ASSES SEE BEFORE THE COMMISSIONER(APPEALS) THAT THE ASSESSEE WOULD BE IN A POSITION TO EXPLAIN THE MATTER TO THE SATISFACTION OF THE ASSES SING OFFICER IF ONE MORE OPPORTUNITY IS GIVEN. THEREFORE, IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN THE INTEREST OF JUSTICE, WE SET ASIDE THE ORDER OF THE COMMISSIONER(APPEALS) IN DELETING THE ADDITION OF ` .3 LAKHS AND REMIT ITA N O.1832(MDS)/2010 4 BACK THE ISSUE TO THE ASSESSING OFFICER FOR FRESH C ONSIDERATION. THE ASSESSEE SHALL BE HEARD IN ACCORDANCE WITH LAW. 8. IN RESULT THIS APPEAL FILED BY TH E REVENUE IS TREATED AS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON WEDNESDAY, T HE 4 TH DAY OF MAY, 2011 AT CHENNAI. SD- SD/- (GEORGE MATHAN) (DR.O.K.NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI, DATED THE 4 TH MAY, 2011. V.A.P. COPY TO: (1) APPELLANT (2) RESPONDENT (3) CIT(A) (4) CIT (5) D.R. (6) GUARD FILE