ITO, CHENNAI V. Dr. Zaheer Ahmed Sayeed, CHENNAI

ITA 194/CHNY/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 9674 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-04-2016
• Appeal Filed By: Department
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 03-02-2016
• Court: TRIBUNAL
• Department Lawyers: H KABILA
• Assessee Lawyers: G SEETHARAMAN
• Keywords: Depreciation; Additional evidence
• Section: 133(6)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : CHENNAI . . . , . !' , # $ % [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ] ./ I.T.A.NO.194/MDS/2016 & C.O.NO.44/MDS/2016 / ASSESSMENT YEAR : 2011-12 THE INCOME TAX OFFICER NON-CORPORATE WARD 3(5) CHENNAI VS. DR. ZAHEER AHMED SAYEED 9, SESHADRI ROAD ALWARPET CHENNAI 600 018 [PAN AAGPS 0107 A ] ( APPELLANT ) (RESPONDENT /CROSS OBEJCTOR ) DEPARTMENT BY : MS. H. KABILA, JCIT ASSESSEE BY : SHRI G. SEETHARAMAN, CA / DATE OF HEARING : 07 - 04 - 2016 / DATE OF PRONOUNCEMENT : 13 - 04 - 2016 / O R D E R PER N.R.S.GANESAN, JUDICIAL MEMBER THE APPEAL OF THE REVENUE AND THE CROSS OBJECTIO N OF THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF THE CO MMISSIONER OF INCOME-TAX (APPEALS)-4, CHENNAI, DATED 20.11.2015 F OR ASSESSMENT YEAR 2011-12. 2. MS. H. KABILA, LD. DEPARTMENTAL REPRESENTATIVE SUBM ITTED THAT THE CIT(A) DELETED THE ADDITION MADE BY THE AS SESSING OFFICER TO ITA NO.194/16 CO NO.44/16 :- 2 -: THE EXTENT OF ` 54,96,105/- AFTER ADMITTING ADDITIONAL EVIDENCE FR OM STATE BANK OF INDIA WITHOUT AFFORDING ANY OPPORTUNI TY TO THE ASSESSING OFFICER IN CONTRAVENTION OF RULE 46A OF THE INCOME- TAX RULES. REFERRING TO THE ORDER OF THE CIT(A), THE LD. DR SU BMITTED THAT THE ASSESSING OFFICER CALLED FOR THE DETAILS FROM THE B RANCH MANAGER, STATE BANK OF INDIA. THE BRANCH MANAGER BY HIS LETTER DA TED 27.10.2015 CLARIFIED THAT THE FD WAS MATURED DURING THE RELEVA NT YEAR ITSELF. HE FURTHER CLARIFIED THAT THE MATURED FD WAS REINVESTE D DURING THE YEAR AND CONVERTED INTO ANOTHER FD WITH PRINCIPAL AMOUNT OF ` 10 LAKHS. ACCORDING TO THE LD. DR, WHEN THE CIT(A) OBTAINED F URTHER INFORMATION FROM THE BRANCH MANAGER, STATE BANK OF INDIA, HE OU GHT TO HAVE GIVEN OPPORTUNITY TO THE ASSESSING OFFICER TO EXAMINE THE SAME. SINCE NO OPPORTUNITY WAS GIVEN TO THE ASSESSING OFFICER, ACC ORDING TO THE LD. DR THERE WAS VIOLATION OF RULE 46A. 3. ON THE CONTRARY, SHRI G. SEETHARAMAN, LD. REPRESENT ATIVE FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAS NOT FILED ANY ADDITIONAL EVIDENCE BEFORE THE CIT(A). REFERRING TO RULE 46A, THE LD. DR SUBMITTED THAT THE CIT(A) IN EXERCISE OF HIS POWER U/S 133(6) OF THE ACT CALLED FOR INFORMATION FROM THE BANK BY LETTER DATED 6.11.2015. THE LD. REPRESENTATIVE HAS PRODUCED THE COPY OF LE TTER WRITTEN BY THE CIT(A) TO THE BRANCH MANAGER, SATE BANK OF INDIA. R EFERRING TO RULE 46A(4), THE LD. REPRESENTATIVE SUBMITTED THAT WHEN THE CIT(A) CALLED ITA NO.194/16 CO NO.44/16 :- 3 -: FOR DETAILS FROM THE BANK DIRECTLY AND EXAMINED THE SAME, IT IS NOT NECESSARY TO GIVE ANY OPPORTUNITY TO THE ASSESSING OFFICER. ACCORDING TO THE LD. REPRESENTATIVE, THE ASSESSEE HAS NOT FI LED ANY ADDITIONAL EVIDENCE/MATERIAL BEFORE THE CIT(A), THEREFORE, THE RE IS NO VIOLATION OF RULE 46A. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. TH E ASSESSING OFFICER MADE ADDITION OF ` 54,78,656/- BEING THE DIFFERENCE IN THE FD AMOUNT AS UNEXPLAINED INCOME FROM OTHER SOURCES. THE CIT( A) IN THE COURSE OF APPELLATE PROCEEDINGS, CALLED FOR INFORMATION U/ S 133(6) OF THE ACT FROM THE BANK AND FOUND THAT THE DIFFERENCE WORKED OUT BY THE ASSESSING OFFICER IN THE FD WAS RECONCILED. THERE FORE, HE DELETED THE ADDITION OF ` 54,96,106/-. THE QUESTION ARISES FOR CONSIDERATIO N IS THAT WHEN THE CIT(A) CALLED FOR INFORMATION BY HIMS ELF FROM STATE BANK OF INDIA, WHETHER SUCH INFORMATION HAS TO BE TREATE D AS ADDITIONAL EVIDENCE FILED BY THE ASSESSEE? 5. WE HAVE GONE THROUGH THE PROVISIONS OF RULE 46A OF THE INCOME-TAX RULES. SUB CLAUSE (4) OF RULE 46A ENABL ES THE CIT TO CALL FOR THE RECORDS OR EXAMINATION OF ANY WITNESS SO AS TO ENABLE HIM TO DISPOSE OF THE APPEAL BY HIM ON HIS OWN MOTION OR O N THE REQUEST OF THE ASSESSING OFFICER. THE EVIDENCE FILED BY THE ASSESSEE UNDER RULE ITA NO.194/16 CO NO.44/16 :- 4 -: 46A(1) HAS TO BE ADMITTED AFTER GIVING AN OPPORTUNI TY TO THE ASSESSING OFFICER. HOWEVER, WHEN THE CIT(A) HIMSELF CALLED F OR THE INFORMATION AND THE MATERIALS, SUCH AN OPPORTUNITY NEED NOT BE GIVEN. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE POWE RS OF THE CIT(A) ARE COTERMINOUS WITH THAT OF THE ASSESSING OFFICER, THE REFORE, THE CIT(A) CAN HIMSELF CALL FOR THE MATERIAL AND EXAMINE THE S AME WITHOUT ANY ASSISTANCE FROM THE ASSESSING OFFICER. SINCE THE C IT(A) HIMSELF CALLED FOR THE RECORDS AND EXAMINED THE SAME, THIS TRIBUN AL IS OF THE CONSIDERED OPINION THAT THERE IS NO VIOLATION OF RU LE 46A AS ALLEGED BY THE LD. DR. ACCORDINGLY, THIS TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE CIT(A). ACCORDING LY, THE SAME IS CONFIRMED. 6. NOW COMING TO THE CROSS OBJECTION FILED BY THE ASS ESSEE, THE FIRST GROUND IS WITH REGARD TO DISALLOWANCE OF TRAV ELLING EXPENSES. 7. SHRI G.SEETHARAMAN, LD. REPRESENTATIVE FOR THE ASS ESSEE SUBMITTED THAT THE ASSESSEE CLAIMED TRAVELLING EXP ENSES OF ` 3,87,797/-. THE ASSESSING OFFICER FOUND THAT THE ASSESSEE WAS AN AGED PERSON, THEREFORE, THE EXPENDITURE INCURRED TO WARDS FOREIGN TRAVEL WAS NOT FOR EARNING THE PROFESSIONAL INCOME ADMITTED BY THE ASSESSEE. ACCORDING TO THE LD. REPRESENTATIVE, THE ASSESSEE HAS VISITED CERTAIN HOSPITALS IN UK FOR FIRST HAND KNOW LEDGE IN THE FIELD OF ITA NO.194/16 CO NO.44/16 :- 5 -: MEDICINE. ACCORDING TO THE LD. REPRESENTATIVE, THE ASSESSEE BEING A NEURO-PHYSICIAN, HE HAS TO UPDATE HIS KNOWLEDGE, TH EREFORE, IT CANNOT BE SAID THAT THE EXPENDITURE INCURRED BY THE ASSES SEE FOR FOREIGN TRAVEL IS NOT FOR EARNING THE INCOME ADMITTED BY TH E ASSESSEE. 8. ON THE CONTRARY, MS.H. KABILA, LD. DR SUBMITTED THA T THE ASSESSEE IS AN AGED PERSON AND HE IS HAVING RESTRIC TIVE MOVEMENT IN INDIA DUE TO OLD AGE, THEREFORE, THE FOREIGN TRAVEL EXPENDITURE CANNOT BE FOR EARNING THE PROFESSIONAL INCOME ADMITTED BY THE ASSESSEE. HENCE, THE ASSESSING OFFICER HAS RIGHTLY DISALLOWED A PORTION OF THE FOREIGN TRAVEL EXPENSES TO THE EXTENT OF ` 1 LAKH. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. TH E ASSESSEE CLAIMED FOREIGN TRAVEL EXPENDITURE OF ` 3,87,797/-. HOWEVER, THE ASSESSING OFFICER DISALLOWED A SUM OF ` 1 LAKH ON THE GROUND THAT THE EXPENDITURE INCURRED BY THE ASSESSEE TOWARDS FOREI GN TRAVEL CANNOT BE FOR EARNING THE PROFESSIONAL INCOME ADMITTED BY THE ASSESSEE DUE TO HIS OLD AGE. THE FACT THAT THE ASSESSEE IS A NEU RO-PHYSICIAN IS NOT IN DISPUTE. BEING A PRACTICING NEURO-PHYSICIAN, THE ASSESSEE HAS TO UPDATE HIS KNOWLEDGE IN THE FIELD IN WHICH HE IS PR ACTICING. THEREFORE, AGE OF THE ASSESSEE IS NOT A CRITERIA FOR UPDATIN G THE KNOWLEDGE. THE FACT THAT THE ASSESSEE TRAVELLED OUT OF THE COUNTR Y IS NOT IN DISPUTE. ITA NO.194/16 CO NO.44/16 :- 6 -: THE ASSESSING OFFICER HIMSELF ALLOWED A PART OF THE EXPENDITURE, THEREFORE, IT IS NOT KNOWN WHY THE REMAINING PART O F ` 1 LAKH CANNOT BE TREATED AS EXPENDITURE FOR EARNING THE PROFESSIONAL INCOME THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT A PRACTI CING PROFESSIONAL HAS TO UPDATE HIS KNOWLEDGE IRRESPECTIVE OF HIS AGE, TH EREFORE, THE EXPENDITURE TOWARDS FOREIGN TRAVEL HAS TO BE ALLOWE D IN TOTO. THE AGE OF THE ASSESSEE CANNOT BE A DETERMINATIVE FACTOR F OR RESTRICTING THE FOREIGN TRAVEL EXPENSES. THEREFORE, WE ARE UNABLE TO UPHOLD THE ORDERS OF THE LOWER AUTHORITIES. ACCORDINGLY, THE ADDITION MADE BY THE ASSESSING OFFICER TO THE EXTENT OF ` 1 LAKH IS DELETED. 10. THE ASSESSEE HAS TAKEN ONE MORE GROUND WITH RGARD TO DEPRECIATION ON MOTOR CAR. 11. SHRI G.SEETHARAMAN, LD. REPRESENTATIVE FOR THE ASS ESSEE SUBMITTED THAT THE ASSESSING OFFICER DISALLOWED 25% OF THE DEPRECIATION ON THE MOTOR CAR TOWARDS PERSONAL USAG E. ACCORDING TO THE LD. REPRESENTATIVE, THE CAR WAS USED ONLY FOR P ROFESSIONAL ACTIVITY AND NOT FOR PERSONAL USE. 12. ON THE CONTRARY, THE LD. DR SUBMITTED THAT IN THE COMPUTATION OF INCOME, THE ASSESSEE HIMSELF ADDED BACK 25% OF THE EXPENSES TOWARDS PERSONAL USAGE. WHEN THE ASSESSE E HIMSELF ADDED BACK 25% OF THE EXPENDITURE TOWARDS PERSONAL USAGE, 25% OF THE ITA NO.194/16 CO NO.44/16 :- 7 -: DEPRECIATION CLAIMED ON THE MOTOR CAR ALSO IS ONLY FOR PERSONAL USAGE, THEREFORE, THE CIT(A) HAS RIGHTLY CONFIRMED THE ORD ER OF THE ASSESSING OFFICER. 13. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS NOT IN DISPUTE THAT THE ASSESSEE HIMSELF ADDED BACK 25% OF THE EXPENDI TURE AS PERSONAL IN NATURE. WHEN THE ASSESSEE HIMSELF CLAIMED THE EXPENDITURE TO THE EXTENT OF 25% AS PERSONAL IN NATURE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT DEPRECIATION ON MOTOR CAR TO THE EXTEN T OF 25% IS ALSO ONLY FOR PERSONAL PURPOSE. THEREFORE, IT CANNOT BE ALLOWED WHILE COMPUTING THE PROFESSIONAL INCOME. IN VIEW OF THE ABOVE, THIS TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH T HE ORDER OF THE CIT(A). ACCORDINGLY, THE SAME IS CONFIRMED. 14. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMIS SED AND THE CROSS OBJECTION OF THE ASSESSEE IS PARTLY ALLO WED. ORDER PRONOUNCED IN THE OPEN COURT ON 13 TH APRIL, 2016, AT CHENNAI. SD/- SD/- ( . !' ) (A. MOHAN ALANKAMONY) # / ACCOUNTANT MEMBER ( . . . ) ) (N.R.S. GANESAN) / JUDICIAL MEMBER / CHENNAI ! / DATED: 13 TH APRIL, 2016 RD ITA NO.194/16 CO NO.44/16 :- 8 -: !' # $% &% / COPY TO: 1 . '( / APPELLANT 4. ) / CIT 2. #*'( / RESPONDENT 5. %+, # - / DR 3. ) () / CIT(A) 6. ,/ 0 / GF