Yash Pal Gogia, New Delhi V. ITO, New Delhi

ITA 2240/DEL/2012

• Counselvise Citation: 224020114 RSA 2012
• Duration Of Justice: 1 year(s) 6 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-11-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 21-10-2013
• Assessment Year: 2004-2005
• Appeal Filed On: 10-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAMEER SHARMA
• Assessee Lawyers: K C PAHUJA
• Keywords: Bonafide mistake
• Section: 56

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : H: NEW DELHI BEFORE SHRI I. C. SUDHIR, JUDICIAL MEMBER AND SHRI J.S. REDDY, ACCOUNTANT MEMBER ITA NO. 2240/DEL/2012 ASSESSMENT YEAR: 2004- 2005 YASH PAL GOGIA VS. ITO D-7, NAVBHARAT APARTMENT, W ARD-43(4), PASCHIM VIHAR MAYUR BHAWAN, NEW DELHI NEW DELHI. (AAEPG420IF) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI K.C. PAHU JA, ADVOCATE RESPONDENT BY : SHRI SAMEER SHAR MA, DR ORDER PER I.C. SUDHIR, JUDICIAL MEMBER THE ASSESSEE HAS QUESTIONED FIRST APPEL LATE ORDER ON THE FOLLOWING GROUNDS :- 1. THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED ITO, WARD 43(4), NEW DELHI GROSSLY ERRED IN NOT COMPLYING WITH THE DIRECTIONS OF THE HONBLE INCOME TA X APPELLATE TRIBUNAL, H- BENCH, NEW DELHI AS PER THEIR ORDER IN INCOME TAX APPEAL NO. 2355/D/08, DATED 27.3.2009. 2. THAT THE LEARNED ITO WRONGLY MADE AD DITION OF RS. 1,26,000/- U/S 23(4)(B) WHICH HAS BEEN WRONGLY CONFIRMED AND UPHELD BY THE LEARNED CIT(A) XXVIII, NEW DELH I 3. THAT THE ADDITION OF RS. 1,26,000/- M ADE BY THE ASSESSING OFFICER, WARD 43(4) MAY BE DELETED B Y THIS HONBLE TRIBUNAL. ITA NO. 2240/DEL/2012 2 2. WE HAVE HEARD AND CONSIDERED THE ARGUMENTS ADVANCED BY THE PARTIES IN VIEW OF THE ORDERS OF THE AUTHORITIES BE LOW AND MATERIAL AVAILABLE ON RECORD. 3. IN SUPPORT OF THE ABOVE GROUNDS LD. AR SUBMITTED THAT THE ORDER DATED 27.3.2009 OF THE TRIBUNAL IN THE CASE OF ASS ESSEE ITSELF IN ITA NO. 2355/D/2008 HAS NOT BEEN COMPLIED WITH AND THE AUTH ORITIES BELOW HAVE MADE AND UPHELD THE SIMILAR ADDITION OF RS. 1,26,00 0/- U/S 23(4)(B) OF THE ACT MADE BY THE AO IN THE ORIGINAL ASSESSMENT. 4. THE LD. DR ON THE OTHER HAND DISPUTED THE ABOVE ALLEGATION OF THE LD. AR THAT ORDER DATED 27.3.2009 OF THE TRIBUNAL I N THE FIRST ROUND HAS NOT BEEN COMPLIED WITH BY THE AO. HE SUBMITTED THAT THE AUTHORITIES BELOW HAVE DISCUSSED THE ISSUE IN DETAIL AND HAVE DECIDED THE ISSUE AS PER THE LAW. 5. ON PERUSAL OF THE ORDER OF THE TRIBUN AL WE FIND THAT THE ISSUE WAS SET ASIDE FOR FRESH ASSESSMENT TO THE FILE OF THE A O AFTER ASCERTAINING THE FACTUAL POSITION AS TO WHETHER THERE WAS ANY FACTUA L ERROR ON THE PART OF THE ASSESSEE WHILE NOT CLAIMING PROPERTY AT PASCHIM VIH AR, NEW DELHI AS SELF OCCUPIED PROPERTY (SOP) AND AS TO WHETHER IT WAS D UE TO A BONAFIDE MISTAKE ON THE PART OF THE ASSESSEE. 6. WE FIND FROM THE ORDER DATED 27.3.2009 OF THE TRIBUNAL THAT THE ADDITION OF RS. 1,20,000/- MADE U/S 23(4)(B) OF THE ACT AND UPHELD BY THE LD. CIT(A) WAS QUESTIONED BY THE ASSESSEE BEFORE TH E TRIBUNAL. SINCE NO ITA NO. 2240/DEL/2012 3 ONE APPEARED ON BEHALF OF THE ASSESSEE BEFORE THE T RIBUNAL, THE TRIBUNAL PROCEEDED EX PARTE QUA THE ASSESSEE. WHILE NOTING T HE FACTS OF THE CASE THE TRIBUNAL HAS MENTIONED THAT THE AO FOUND THAT ASSES SEE IS OWNER OF TWO FLATS NAMELY FLAT IN PASCHIM VIHAR, NEW DELHI AND F LAT AT SECTOR 56 GURGAON. FLAT IN PASCHIM VIHAR WAS PURCHASED BY THE ASSESSEE IN 1985, WHEREAS THE FLAT IN GURGAON WAS PURCHASED BY HIM DURING FINANCI AL YEARS 2002 TO 2004. ACCORDING TO THE AO WHEN ASSESSEE OWNS MORE THAN ON E HOUSE, THEN ANNUAL VALUE OF THE HOUSE (ALV) OTHER THAN THE HOUS E IN RESPECT OF WHICH THE ASSESSEE HAS EXERCISED AN OPTION UNDER CLAUSE ( A) SHALL BE DETERMINED UNDER SUB SECTION (1) AS IF SUCH HOUSE HAD BEEN LET OUT AND ACCORDINGLY BE TREATED THE FLAT OF PASCHIM VIHAR AS LET OUT. THE A O FURTHER OBSERVED THAT ASSESSEE EXERCISED HIS OPINION TO TREAT GURGAON FLA T AS SELF-OCCUPIED PROPERTY. THUS DETERMINED THE ALV OF PASCHIM VIHAR FLAT AT RS. 15,000/- PER MONTH AFTER ALLOWING A REBATE U/S 24 (A) OF THE ACT. HE TOOK INCOME FROM HOUSE PROPERTY AT RS. 26,000/-. BEFORE THE LD. CIT(A) ASSESSEE CONTENDED THAT HE IS RESIDING IN PASCHIM VIHAR PRO PERTY AND THEREFORE IT IS TO BE TREATED AS SOP AND THE LETTING VALUE BE DETER MINED WHICH REGARD TO GURGAON FLAT. LD. CIT(A) REJECTED THE CONTENTION OF THE ASSESSEE ON THE BASIS THAT SUCH CHANGE CANNOT BE PERMITTED AT APPEL LATE STAGE. CONSIDERING THESE FACTS OF THE CASE THE TRIBUNAL SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND RESTORED THIS ISSUE TO THE FILE OF THE AO FOR TWO REASONS NAMELY THE AO HAS NOT MADE IN REFERENCE AS TO HOW HE DETER MINED THE VALUE OF THE ITA NO. 2240/DEL/2012 4 FLAT AT PASCHIM VIHAR AT RS. 15,000/- PER MONTH. A CCORDING TO THE AO ASSESSEE HAD NOT GIVEN THE ACTUAL VALUE, THEREFORE, HE DEEMED RS. 15,000/- AS A REASONABLE VALUE. THE TRIBUNAL EXPRESSED THEIR VIEW THAT THERE SHOULD BE SOME CORROBORATIVE EVIDENCE IN SUPPORT OF SUCH BELIEF. THE SECOND REASON FOR SETTING ASIDE THE ISSUE RECORDED BY THE TRIBUNAL IS THAT THE ASSESSEE AS PLEADED BEFORE THE LD. CIT(A) THAT THE ASSESSEE IS RESIDING IN PASCHIM VIHAR, FOR THE LAST MORE THAN 15 YEARS HE NCE THERE MAY BE SOME FACTUAL ERROR ON THE PART OF THE ASSESSEE WHILE NOT CLAIMING THIS PROPERTY AS SOP. IT WAS NOTED BY THE TRIBUNAL THAT IF IT IS A B ONAFIDE MISTAKE ON THE PART OF THE ASSESSEE, THEN THE AO SHALL PERMIT THE ASSES SEE TO RECTIFY SUCH MISTAKE AND DECLARE GURGAON PROPERTY FOR THE PURPOS E OF DETERMINING ALV. IN COMPLIANCE OF THIS ORDER OF THE TRIBUNAL, THE AO FRAMED FRESH ASSESSMENT ON 23.11.2009 CONFIRMING THE SAME ADDITION OF RS. 1 ,26,000/- ON ACCOUNT OF HOUSE PROPERTY. ON PERUSAL OF THE ASSESSMENT ORDER DATED 23.11.2009 FRAMED BY THE AO IN COMPLIANCE WITH THE ABOVE ORDER DATED 27.3.2009 OF THE TRIBUNAL, WE FIND THAT THE AO HAS MADE SIMILAR ADDITION OF RS. 1,26,000/- U/S 23(4)(B) OF THE ACT ON THE BASIS THA T AT LATER STAGE BEFORE THE LD. CIT(A) THE ASSESSEE HAS TAKEN CONTRARY CLAIM TH AT INSTEAD OF GURGAON FLAT AS SHOWN BY HIM AS SOP IN THE RETURN OF INCOME , FLAT OF PASCHIM VIHAR SHOULD BE TREATED AS SOP. THE REASON SHOWN BY THE A SSESSEE FOR THE ABOVE FACTUAL ERROR WAS THAT THOUGH THE RETURN WAS FILED BY THE ASSESEE SHOWING HIM RESIDENT OF THE FLAT AT PASCHIM VIHAR, NEW DELH I BUT THE ASSESSEE HAD ITA NO. 2240/DEL/2012 5 NOT CLAIMED THE PROPERTY AT PASCHIM VIHAR AS SOP. I T WAS A BONAFIDE MISTAKE ON THE PART OF THE ASSESSEE. WE FIND THAT W HILE REPEATING THE SAME ADDITION THE AO HAS NOT BOTHERED HIMSELF TO EXAMINE THE BONAFIDE OF THE ASSESSEE IN NOT CLAIMING PROPERTY AT PASCHIM VIHAR AS SOP WHERE HE WAS RESIDING THERE FOR THE LAST MORE THAN 15 YEARS NOR HAS THE AO BOTHERED HIMSELF TO STATE THE BASIS ON WHICH HE DETERMINED T HE RENTAL VALUE OF THE FLAT AT PASCHIM VIHAR AT RS. 15,000/- PER MONTH. WE THUS FULLY CONCUR WITH THE GRIEVANCE OF THE ASSESSEE THAT THE AO HAS NOT C OMPLIED WITH THE DIRECTION OF THE TRIBUNAL WHILE MAKING THE FRESH AS SESSMENT WITHOUT EXAMINING THE BONAFIDE OF THE ERROR AS STATED ABOVE BY THE ASSESSEE WHILE NOT CLAIMING PROPERTY AT PASCHIM VIHAR AS SOP AND THE BASIS FOR ESTIMATING ALV AT RS. 15,000/- PER MONTH AS A REASONABLE. THE AO HAS SIMPLY NOTED THAT THE ASSESSEE NOW WANTS TO CHANGE HIS OPTION TH AT PASCHIM VIHAR FLAT SHOULD BE TREATED AS SOP AND THAT HAS CONTENDED THA T THE LET OUT VALUE THEREOF ESTIMATED BY THE AO IS EXCESSIVE AND HE FIN DS NO REASON TO INTERFERE WITH THE ORDER PASSED BY THE THEN AO. LD. CIT(A) HA S UPHELD THE SAME WITHOUT EXAMINING THIS MATERIAL ASPECT AS TO WHETHE R THE AO HAD COMPLIED WITH THE DIRECTION OF THE TRIBUNAL WHILE MAKING FRE SH ASSESSMENT ON THE ISSUE. WE THUS WHILE SETTING ASIDE THE ORDERS OF TH E AUTHORITIES BELOW IN THIS REGARD REMIT THE MATTER BACK TO THE FILE OF THE AO TO PASS FRESH ASSESSMENT ORDER ON THE ISSUE AFTER AFFORDING OPPORTUNITY OF B EING HEARD TO THE ASSESSEE WHILE GIVING FINDING ON THE BONAFIDE OF F ACTUAL ERROR COMMITTED BY ITA NO. 2240/DEL/2012 6 THE ASSESSEE IN ITS RETURN OF INCOME BY NOT TREATIN G THE PROPERTY AT PASCHIM VIHAR AS SOP AND SHOWING THE REASON FOR ESTIMATION OF ALV OF RS. 15,000/- PER MONTH OF THE PROPERTY AT PASCHIM VIHAR. THE GRO UNDS ARE THUS ALLOWED FOR STATISTICAL PURPOSES. 7. IN THE RESULT APPEAL IS ALLOWED FOR ST ATISTICAL PURPOSES. THE ORDER IS PRONOUNCED IN THE OPEN CO URT ON 22 ND NOVEMBER, 2013. SD/- SD/- (J. S. REDDY) ( I.C. SUDHIR ) ACCOUNTANT MEMBER JUDICI AL MEMBER DATED 22 ND NOVEMBER, 2013 VEENA COPY OF ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR BY ORDER DEPUTY REGISTRAR, ITAT