I.T.O Wd - 55(1) ,kolkata., Kolkata V. Dr .Arun Kumar Mukherji., Kolkata

ITA 218/KOL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 99911 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 8 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-10-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 01-02-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: AMITAVA BHATTARCHARYA JCITSRDR
• Keywords: Unexplained cash credit
• Section: 143(3); 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH B KOLKATA BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ITA NO. 218 / KOL / 2013 ASSESSMENT YEAR :2009-10 INCOME TAX OFFICER, WARD-55(1), 54/1, RAFI AHMED KIDWAI ROAD, KOLKATA V/S . DR. ARUN KUMAR MUKHERJEE CF-338, SECTOR-I, SALT LAKE, KOLKATA 700 064 [ PAN NO.ADXPM 9980-F /APPELLANT .. / RESPONDENT /BY APPELLANT SHRI AMITAVA BHATTARCHARYA, JCIT-SR-DR /BY RESPONDENT NONE /DATE OF HEARING 28-09-2015 /DATE OF PRONOUNCEMENT 15-10-2015 / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER:- THIS APPEAL BY THE REVENUE IS ARISING OUT OF ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) XXXVI, KOLKATA IN APPEAL NO.5 47/CIT(A)-XXXVI/ KOL/RANGE-55/11-12 DATED 27.11.2012. ASSESSMENT WAS FRAMED BY ACIT,RANJE-55, KOLKATA U/S 143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) VIDE HIS ORDER DATED 30.1 2.2011 FOR ASSESSMENT YEAR 2009-10. 2. AT THE TIME OF HEARING, NONE APPEARED ON BEHALF OF ASSESSEE, HENCE, WE PROCEED TO THIS APPEAL, AFTER HEARING MR. AMITAVA B HATTACHARYA LD. DEPARTMENTAL REPRESENTATIVE APPEARING ON BEHALF OF REVENUE. ITA NO.218/KOL/2013 A.Y. 2009-10 ITO WD-55(1), KOL V. DR. ARUN KR. MUKHERJI PAGE 2 3. FIRST ISSUE RAISED BY REVENUE IS THAT LD. CIT(A) HAS ERRED IN ALLOWING RELIEF TO ASSESSEE REGARDING DISALLOWANCE MADE BY A SSESSING OFFICER U/S 40(A)(IA) OF THE ACT OF RS.48,382/-. 4. BRIEFLY STATED FACTS ARE THAT ASSESSEE IS AN IND IVIDUAL AND ACTING AS MEDICAL PRACTITIONER. DURING THE YEAR ASSESSEE CLAI MED OF RS.48,382/- TOWARDS AUDIT FEES AND ON QUESTION ASKED BY THE AO FROM ASS ESSEE REGARDING THE VIOLATION OF SEC. 194J OF THE ACT FOR NON DEDUCTING TDS ON THE SAID AMOUNT. BUT ASSESSEE COULD NOT PRODUCE ANY EXPLANATION IN T HIS REGARD, THEREFORE IT HAS BEEN ADDED TO THE INCOME OF ASSESSEE. AGGRIEVED , ASSESSEE PREFERRED AN APPEAL BEFORE LD. CIT(A) WHO HAS DELETED THE ADDITI ON MADE BY ASSESSING OFFICER BY OBSERVING PARA-5 OF HIS ORDER, WHICH REP RODUCED AS UNDER:- 5. GROUND NO. 5: THIS IS REGARDING DISALLOWANCE OF AUDIT FEES OF RS.48,382/- U/S. 40(A)(IA) OF INCOME TAX ACT. DURIN G APPELLANT PROCEEDING IT WAS CLAIMED BY THE APPELLANT THAT OU T OF TOTAL AUDIT FEES OF RS.48,382/- A SUM OF RS.40,450/- HAS BEEN PAID AND BALANCE OF RS.7932/- IS PAYABLE. HE REQUESTED TO ALLOW THE AUD IT FEES PAID OF RS.40,450/-, KEEPING IN VIEW OF JUDGEMENT IN CASE O F MERILYN SHIPPING & TRANSPORT VS. ADDL. CIT, ITA NO.477/VIZ./2008. SUBMISSION OF A/R AND GROUNDS OF APPEAL WERE DULY C ONSIDERED. SPECIAL BENCH JUDGEMENT IN CASE OF MERILYN SHIPPING & TRANSPORTS HAS BEEN FOLLOWED BY JURISDICTIONAL ITAT IN CASE OF MAH A LAXMI RICE MILLS VS. ADDL. CIT, ITA NO. 172/KOL/2012, WHEREIN IT IS MENTIONED THAT EVEN IF TDS HAS NOT BEEN DEDUCTED AND AMOUNT HAS BEEN PAID DURING THE YEAR, THE SAID AMOUNT IS ALLOWABLE. KEEPING IN VIEW OF TH ESE, AUDIT FEES PAID TO THE EXTENT IS RS.40,450/- IS ALLOWED. APPELLANT GETS RELIEF OF RS.40,450/-. HOWEVER, LD. AR DEMONSTRATED BEFORE LD. CIT(A) THAT A SUM OF RS.40,450/- HAS BEEN PAID AND BALANCE OF RS.7,932/- IS PAYABLE AT THE YEAR END. AGGRIEVED, REVENUE IS IN APPEAL BEFORE US. 5. WE HAVE HEARD LD. DR AND PERUSED THE MATERIALS A VAILABLE ON RECORD. IT IS IMPORTANT TO NOTE THAT THE JUDGMENT PASSED BY IT AT SPECIAL BENCH OF VISHAKHAPATNAM IN THE CASE OF MERILYN SHIPPING & TRANSPORT VS. ADDL. CIT IN ITA NO.218/KOL/2013 A.Y. 2009-10 ITO WD-55(1), KOL V. DR. ARUN KR. MUKHERJI PAGE 3 ITA NO. 477/VIZ/2008 HAS BEEN REVERSED BY HON'BLE J URISDICTIONAL CASE IN THE CASE OF CIT V. CRESCENT EXPORTS SYNDICATE, WHEREIN IT WAS HELD THAT GROUND IN FAVOUR OF REVENUES AS UNDER:- THE KEY WORDS USED IN SECTION 40(A)(IA), ACCORDING TO US, ARE ON WHICH TAX IS DEDUCTIBLE AT SOURCE UNDER CHAPTER XVII-B. IF THE QUESTION IS WHICH EXPENSES ARE SOUGHT TO BE DISALLOWED? THE ANSWER IS BOUND TO BE THOSE EXPENSES ON WHICH TAX IS DEDUCTIBLE AT SOURC E UNDER CHAPTER XVII-B. ONCE THIS IS REALIZED NOTHING TURNS ON THE BASIS OF THE FACT THAT THE LEGISLATURE USED THE WORD PAYABLE AND NOT PAID OR CREDITED . UNLESS ANY AMOUNT IS PAYABLE, IT CAN NEITHER BE PAID NOR C REDITED. IF AN AMOUNT HAS NEITHER BEEN PAID NOR CREDITED, THERE CAN BE NO OCCASION FOR CLAIMING ANY DEDUCTION. 6. NEXT GROUND OF REVENUES APPEAL IS AS REGARDS TH AT LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.40,01,022/- MA DE BY ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED CASH CREDIT. IN THIS CASE, A SSESSEE HAS TAKEN A LOAN FROM HIS NON-RESIDENT DOCTOR WIFE, WHO HAS SETTLED IN U.K. THE AO CALLED UPON THE ASSESSEE TO FURNISH HER RESIDENTIAL ADDRESS IN U.K., SOURCE OF INCOME DETAILS, BANK ACCOUNT THROUGH WHICH THE MONEY IS ST ATED TO BE TRANSFERRED TO HIS ACCOUNT AND OTHER RELEVANT DETAILS SO AS TO PRO VE THE CREDITWORTHINESS AND GENUINENESS OF THE SAID TRANSACTIONS. HOWEVER, LD. AR OF ASSESSEE COULD NOT SUBSTANTIATE THE TRANSACTIONS BY PRODUCING EVIDENTI ARY DOCUMENTS. THEREFORE, THE AO ADDED THE SAME TO THE INCOME OF ASSESSEE. AG GRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE LD. CIT(A). LD. AR OF AS SESSEE IN APPELLATE STAGE STATED THAT LOAN OF RS.41 LAKH WAS ACCEPTED IN THE EARLIER YEAR. IT WAS FURTHER OBSERVED BY LD. CIT(A) THAT ASSESSEE HAS BEEN REGUL ARLY RECEIVING THE LOAN IN THE PRECEDING YEAR ALSO AND HE HAS VERIFIED ALL THE CREDIT AND DEBIT ENTRIES FROM THE BANK STATEMENT OF ASSESSEE AND THE BANK ST ATEMENT OF HIS WIFE IN U.K. THEREFORE, LD. CIT(A) HAS DELETED THE ADDITION MADE BY AO. AGGRIEVED, NOW REVENUE IS IN APPEAL BEFORE US. 7. WE HAVE HEARD LD. DR AND PERUSED THE MATERIALS A VAILABLE ON RECORD. IN THIS CASE, IT WAS OBSERVED THAT ORDER OF AO IS S ILENT ABOUT THE RECEIPT OF THE SAID LOAN WHETHER THE LOAN IS RECEIVED IN THE CURRE NT YEAR OR EARLIER YEAR ALSO IF ITA NO.218/KOL/2013 A.Y. 2009-10 ITO WD-55(1), KOL V. DR. ARUN KR. MUKHERJI PAGE 4 PERTAINS PRIOR TO YEAR UNDER CONSIDERATION THEN THE QUESTION OF DISALLOWANCE OF LOAN DOES NOT ARISE. SINCE THE ORDER OF AO IS SILEN T ON THIS SUBJECT, THEREFORE WE ARE INCLINED TO RESTORE THE FILE TO AO WITH A DI RECTION TO ESTABLISH THE DATE OF LOAN WHICH PERTAINS TO EARLIER YEAR OR CURRENT YEAR . HENCE, THIS GROUND OF REVENUES APPEAL IS ALLOWED FOR STATISTICAL PURPOSE . 8. COMING TO NEXT GROUND OF REVENUES APPEAL IN REG ARD TO DELETE THE ADDITION OF RS. 10 LAKH MADE BY AO ON ACCOUNT OF DI FFERENCE BETWEEN ADVANCE SHOWN BY ASSESSEE IN HIS BOOKS OF ACCOUNT A ND AMOUNT SHOWN BY THE BUYER OF PROPERTY. IN THIS CASE, ASSESSEE HAS T AKEN AN ADVANCE OF RS.25 LAKH FROM MR.RAJIV BHATIA FOR THE PURPOSE TO TRANSF ER OF PROPERTY LOCATED AT SILVER SPRING, THE ASSESSEE HAS SHOWN ADVANCE OF RS .25 LAKH. HOWEVER, IN RESPONSE TO NOTICE U/S 133(6) OF THE ACT FROM AFORE SAID BUYER THERE HE HAS STATED THAT HE HAS PAID A SUM OF RS.35 LAKH TO ASSE SSEE AS ADVANCE FOR PURCHASE OF SAID FLAT. ON QUESTION BY AO TO ASSESSE E REGARDING THE DISCREPANCY OF RS.10 LAKH BUT ASSESSEE FAILED TO PR OVIDE SATISFACTORY REPLY. THEREFORE, AO HAS DISALLOWED A SUM OF RS.10 LAKH AN D ADDED TO THE INCOME OF ASSESSEE. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL B EFORE LD. CIT(A). LD. CIT(A) HAS DELETED THE ADDITION MADE BY AO BY OBSER VING THAT TRANSACTIONS FOR SALE AND PURCHASE OF SAID FLAT BETWEEN ASSESSEE AND MR. RAJIV BHATIA HAS NOT YET BEEN COMPLETED. THE ASSESSEE SHOWED IN ITS BOOK S OF ACCOUNT THAT HE HAS RECEIVED ONLY RS.25 LAKH AND ON THE OTHER HAND BUYE R SHRI RAJIV BHATIA CLAIMED TO HAVE PAID ADVANCE OF RS.35 LAKH. IN THIS CASE, THE SALE TRANSACTION HAS NOT BEEN TAKEN PLACE AND IT WILL BE WORKED-OUT IN THE YEAR WHEN THE TRANSACTIONS OF SALE AND PURCHASE WILL TAKE PLACE. SO THE ADDITION MADE BY AO HAS BEEN DELETED BY LD. CIT(A). AGGRIEVED, NOW REVE NUE IS IN APPEAL BEFORE US. 9. WE HAVE HEARD LD. DR AND PERUSED THE MATERIALS A VAILABLE ON RECORD. IT IS FOUND FROM THE ORDER THAT ASSESSEE WAS GIVEN SEV ERAL OPPORTUNITY TO EXPLAIN THE DIFFERENCE OF RS.10 LAKH BUT ASSESSEE FAILED TO RECONCILE THE SAME. IT IS ITA NO.218/KOL/2013 A.Y. 2009-10 ITO WD-55(1), KOL V. DR. ARUN KR. MUKHERJI PAGE 5 ALSO OBSERVED THAT IN APPELLATE STAGE SAID TRANSACT ION HAS NOT TAKEN PLACE, THEREFORE, ADDITION OF RS.10 LAKH CANNOT BE TAKEN T O THE HANDS OF ASSESSEE. WE ALSO OBSERVE THAT ASSESSEE HAS NOT BEEN ABLE TO SUBSTANTIATE HIS CLAIM AT THE ASSESSMENT PROCEEDINGS. HENCE, WE ARE INCLINED TO GIVE ONE MORE OPPORTUNITY TO ASSESSEE TO DEFEND HIS CLAIM BEFORE AO. THEREFORE, THIS GROUND OF REVENUES APPEAL IS RESTORED TO THE FILE OF AO F OR FRESH ADJUDICATION ACCORDING TO LAW AFTER PROVIDING REASONABLE OPPORTU NITY OF BEING HEARD TO ASSESSEE. 10. IN THE RESULT, REVENUES APPEAL IS ALLOWED FOR STAT ISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT 15/10 /2015 SD/- SD/- (MAHAVIR SINGH) (WASEEM AHMED) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) KOLKATA, *DKP !- 15 /10/2015 / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT-ITO WARD-55(1), 54/1, RAFI AHMED KIDWA I RD. KOL-16 2. / RESPONDENT-DR. ARUN KR. MUKHERJI, CF-338, SECTOR -I, SALTLAKE, KOL-64 3. * +, - - . / CONCERNED CIT KOLKATA 4. - - .- / CIT (A) KOLKATA 5. 012 33+,, - +, , / DR, ITAT, KOLKATA 6. 267 89 / GUARD FILE. BY ORDER/ - , /TRUE COPY/ / - +, ,