Dr.Kiran Krishna Murthy, Hyderabad, Hyderabad V. Dy. Commissioner of Income Tax, Circle-1(1), Hyderabad

ITA 1984/Hyd/2017

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 0500 (ITAT-HYDERABAD)
• Duration Of Justice: 3 year(s) 7 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-07-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-B
• Next Hearing Date: 03-05-2021
• Assessment Year: misc
• Appeal Filed On: 01-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B V PRASAD REDDY
• Assessee Lawyers: RAMA MOHAN
• Keywords: Search and seizure
• Section: 143(3); 158BC; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER AND SHRI S.S. GODARA, JUDICIAL MEMBER ITA NO. 1984/HYD/2017 BLOCK PERIOD: 1989 TO 1999 DR. KIRAN KRISHNAMURTHY, HYDERABAD. PAN: AFGPK 1912 C VS. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE - 1(1), HYDERABAD. (APPELLANT) (RESPONDENT) ASSESSEE BY: SRI RAMA MOHAN REVENUE BY: SRI B.V. PRASAD REDDY, DR DATE OF HEARING: 03/05/2021 DATE OF PRONOUNCEMENT: 15 /07/2021 ORDER PER A. MOHAN ALANKAMONY, AM.: THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD. CIT (A) - 1, HYDERABAD IN APPEAL NO. 0061/2005 - 06/CIT(A) - 1/HYD/2016 - 17, DATED 28/06/2017 PASSED U/S. 143(3) R.W.S 158BC & 254 OF THE ACT FOR THE BLOCK PERIOD 1/4/1989 TO 04/11/1999. 2. THE ASSESSEE HAS RAISED SIX GROUNDS IN H ER APPEAL AND THEY ARE EXTRACTED HEREIN BELOW FOR REFERENCE : 1. THE LD COMMISSIONER (APPEALS) HAS ERRED IN UPHOLDING THE ADDITION OF RS. 2,43,000/ - FOR THE FUNDS LENT BY THE ASSESSEE TO HER HUSBAND AND HER DISCLOSED INCOME. 2 2. THE LD COMMISSIONER (APPEALS) HAS ERRED IN UPHOLDING THE ADDITION OF RS. 66,650/ - FOR THE DEPOSITS IN HER BANK ACCOUNT AS HER UNDISCLOSED INCOME. 3. THE LD COMMISSIONER (APPEALS) HAS ERRED IN UPHOLDING THE LEVY OF SURCHARGE. 4. THE LD. COMMISSIONER (APPEALS) HAS ERRED IN UPHOLDING THE INTEREST LEVIED U/S. 158BFA(1). 5. THE LD COMMISSIONER (APPEALS) HAS ERRED IN UPHOLDING THE PEN ALTY PROCEEDINGS INITIATED BY THE ASSESSING OFFICER U/S. 158 BFA(2). 6. ANY OTHER GROUND OR GROUNDS TH A T MAY BE URGED AT THE TIME OF HEARING. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL ENGAGED IN THE MEDICAL PROFESSION AS A DOCTOR AND ALSO DIRECTOR OF M/S. ANDROMEDA FOUNDATION PRIVATE LIMITED. A SEARCH AND SEIZURE OPERATION U/S. 132 OF THE ACT WAS CONDUCTED IN THE RESIDE NTIAL PREMISES OF DOCTOR SUDHAKAR KRISHNA MURTHY HUSBAND OF THE ASSESSEE ON 4/11/1999. THEREAFTER NOTICE U/S. 158BC OF THE ACT WAS ISSUED TO THE ASSESSEE AND FINALLY ASSESSMENT WAS COMPLETED U/S. 143(3) R.W.S 158BC OF THE ACT ON 22/3/2005 WHEREIN ADDITION WAS MADE IN THE HANDS OF THE ASSESSEE ON ACCOUNT OF UNDISCLOSED INCOME FOR THE BLOCK PERIOD AMOUNTING TO RS. 5,69,650/ - . 4. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE LD. AO OBSERVED FROM THE SEIZED MATERIAL FOUND DURING THE COURSE OF SEARCH THAT THE ASSESSEE HAD INCURRED EXPENDITURE TOWARDS RENOVATION OF HER FLAT INCLUDING PURCHASE OF FURNITURE AND OTHER AMENITIES. THOUGH THE ASSESSEE HAD EXPLAINED TO THE LD. AO T HAT THE SEIZED MATERIALS WERE 3 PERTAINING TO ESTIMATION AND NOT ACTUAL PURCHASE . HOWEVER, THE LD. AO DISBELIEVING THE ASSERTION OF THE ASSESSEE COMPUTED THE UNDISCLOSED INCOME OF THE ASSESSEE AT RS. 5,69,650/ - FOR THE PERIOD PERTAINING TO 1990 - 91 TO 2000 - 01 . ON APPEAL, THE LD. CIT (A) PARTLY ALLOWED THE APPEAL OF THE ASSESSEE. HOWEVER, SUSTAINED THE ADDITION WITH RESPECT TO RS. 2,43,000 AND RS. 66,650/ - WHICH WERE EXPLAINED BY HER AS THE LOAN REPAYMENT RECEIVED FROM HER HUSBAND AND BANK DEPOSIT OF RS. 66,65 0/ - . 5. AT THE OUTSET, WE DO NOT FIND MUCH MERIT IN THE ORDERS OF THE LD. REVENUE AUTHORITIES ON THIS ISSUE. CONSIDERING THE FINANCIAL AND PROFESSIONAL BACKGROUND OF THE ASSESSEE AND HER FAMILY, WE ARE OF THE VIEW THAT THE AMOUNT SUSTAINED BY THE LD. CIT (A) ARE FROM THE ACCUMULATED SAVINGS OF THE ASSESSEE AND HER FAMILY AND HENCE IT CANNOT BE TREATED AS UNDISCLOSED INCOME AS HELD BY THE LD. REVENUE AUTHORITIES . THEREFORE, WE HEREBY DIRECT THE LD. AO TO DELETE THE ADDITION SUSTAINED BY THE LD. CIT (A) AMOU NTING TO RS. 2,43,000 AND RS. 66,650/ - ON ACCOUNT OF UNDISCLOSED INCOME. SINCE, THE ADDITION MADE BY THE LD. REVENUE AUTHORITIES ARE HEREBY DELETED THE QUESTION OF LEVY OF INTEREST U/S. 158BFA(1) & (2) DOES NOT ARISE. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. PRONOUNCED IN THE OPEN COURT ON 15 TH JULY, 2021. SD/ - SD/ - (S.S. GODARA) ( A. MOHAN ALANKAMONY ) JUDICIAL MEMBER ACCOUNTANT MEMBER 4 HYDERABAD, DATED: 15 TH JULY, 2021. OKK COPY TO: - 1. DR. KIRAN KRISHNAMURTHY, GANDHI & GANDHI, CHARTERED ACCOUNTANTS, 1002, PAIGAH PLAZA, BASHEERBAGH, HYDERABAD - 63. 2. DCIT, CIRCLE - 1(1), AAYAKAR BHAVAN, BASHEERBAGH, HYDERABAD - 500 001. 3. THE CIT (A) - 1, HYDERABAD. 4. THE PR. CIT - 1, HYDERABAD. 5. THE DR, ITAT, HYDERABAD. 6. GUARD FILE