Babu John, Trichur V. DCIT, Trichur

ITA 228/COCH/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 2631 (ITAT-COCHIN)
• Duration Of Justice: 11 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-07-2013
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Next Hearing Date: 28-05-2013
• Assessment Year: 2009-2010
• Appeal Filed On: 13-08-2012
• Court: TRIBUNAL
• Department Lawyers: SUSAN GEORGE VARGHESE
• Assessee Lawyers: C B M WARRIER
• Keywords: Unexplained investment
• Section: 153A; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE S/SHRI N.R.S.GANESAN, JM AND B.R.BASKAR AN, AM I.T.A. NOS. 227 & 228/COCH/2012 ASSESSMENT YEARS : 2007-08 & 2009-10 SHRI BABU JOHN, VALLUPARA HOUSE, PERINCHERRY, THRISSUR [PAN: AEGPJ 6237C] VS. THE DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE, THRISSUR. (ASSESSEE-APPELLANT) (REVENUE-R ESPONDENT) ASSESSEE BY SHRI C.B.M. WARRIER, CA REVENUE BY SMT. SUSAN GEORGE VARGHESE, SR. DR DATE OF HEARING 28/05/2013 DATE OF PRONOUNCEMENT 18/07/2013 O R D E R PER B.R.BASKARAN, ACCOUNTANT MEMBER: THE APPEALS FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE COMMON ORDER DATED 28-05-2012 PASSED BY THE LD. CIT(A)-I, KOCHI FOR TH E ASSESSMENT YEARS 2003-04 TO 2009-10. HOWEVER, THE PRESENT APPEALS RELATE TO THE ASSESSMENT YEARS 2007-08 AND 2009-10 ONLY. 2. THE ASSESSEE IS ASSAILING THE DECISION OF LD. CI T IN CONFIRMING THE ADDITIONS MADE BY THE ASSESSING OFFICER IN BOTH THE YEARS UND ER CONSIDERATION IN RESPECT OF UNEXPLAINED INVESTMENTS IN LAND AND ADDITION TO SHORT TERM CAPITAL GAINS. 3. THE FACT RELATING TO THE SAID ISSUES ARE STATED IN BRIEF. THE ASSESSEE IS A PARTNER IN A CONCERN NAMED M/S. ST. ANTONYS TIMBER DEPOT, THRISSUR AND IS ALSO THE PROPRIETOR OF ST. JOHNS TIMBERS. THE REVENUE CARRIED OUT SEA RCH AND SEIZURE OPERATIONS U/S. 132 I.T.A. NOS. 227 & 228/COCH/2012 2 OF THE ACT IN THE CASE OF M/S. ST. ANTONYS TIMBER DEPOT AND ALSO IN THE HANDS OF THE ASSESSEE ON 23-10-2008. CONSEQUENT THERE-TO, THE A SSESSMENTS IN THE HANDS OF THE ASSESSEE WERE FRAMED U/S. 153A OF THE ACT. IN ASSE SSMENT YEAR 2007-08, THE ASSESSING OFFICER, INTER ALIA, MADE FOLLOWING TWO ADDITIONS: (A) UNEXPLAINED INVESTMENT IN LAND : RS.5,5 2,648/- (B) ADDITION TO SHORT TERM CAPITAL GAIN : RS. 68,062/- IN THE ASSESSMENT YEAR 2009-10, THE ASSESSING OFFIC ER, INTER ALIA, MADE FOLLOWING TWO ADDITIONS: (A) UNEXPLAINED INVESTMENT IN LAND : RS. 6,45 ,000/-. (B) ADDITION OF SHORT TERM CAPITAL GAIN : RS. 1,4 8,598/- 4. IN THE APPELLATE PROCEEDINGS, THE LD. CIT(A) CON FIRMED THE ABOVE SAID ADDITIONS IN BOTH THE YEARS AND HENCE, THE ASSESSEE HAS FILE D THESE APPEALS BEFORE US. 5. THE LD. COUNSEL APPEARING FOR THE ASSESSEE SUBMI TTED THAT THE ASSESSEE PURCHASED A LAND HAVING AN EXTENT OF 53.50 CENTS JO INTLY WITH SOME OTHER PERSONS AT A PLACE CALLED POOCHUNIPADAM DURING THE FINANCIAL YEA R RELEVANT TO THE ASSESSMENT YEAR 2007-08. HE ALSO PURCHASED ANOTHER LAND HAVING AN EXTENT OF 33.80 CENTS ALONG WITH SOME OTHER PERSONS AT ANOTHER PLACE CALLED VENDOOR DURING THE FINANCIAL YEAR RELEVANT TO THE ASSESSMENT YEAR 2009-10. ACCORDING TO THE ASSESSING OFFICER, THE ASSESSEE HAS UNDERSTATED THE PURCHASE CONSIDERATION IN RESPECT O F BOTH THE PROPERTIES AND ACCORDINGLY ADDED THE PROPORTIONATE DIFFERENCE RELA TABLE TO THE ASSESSEE AS UNEXPLAINED INVESTMENTS IN BOTH THE YEARS. HE SUBMITTED THAT TH E ASSESSING OFFICER HAS, FOR THE PURPOSE OF MAKING ADDITIONS, PLACED RELIANCE PARTLY ON SEIZED MATERIAL AND PARTLY ON THE SWORN STATEMENTS GIVEN BY THE ASSESSEE AS WELL AS T HE CO-OWNERS. THE ASSESSING OFFICER HAS CHOSEN TO ADOPT THE EVIDENCES WHICH SUI TED THE REVENUE AND THE SAID ACTION OF THE ASSESSING OFFICER IS NOT JUSTIFIABLE. HE SUB MITTED THAT THE ASSESSING OFFICER HAS PRESUMED THAT THE ASSESSEES SHARE IN VENDOOR PROPE RTY IS 10 CENTS. HOWEVER, THE FACT REMAINS THAT THE ASSESSEE IS HAVING ONLY 1/4 TH RIGHT OVER 33.80 CENTS OF VENDOOR PROPERTY. HE SUBMITTED THAT THE ASSESSING OFFICER HAS DISREGARDED THE SOURCES AVAILABLE I.T.A. NOS. 227 & 228/COCH/2012 3 WITH THE ASSESSEE WHILE WORKING OUT THE UNEXPLAINED INVESTMENTS. IN SUPPORT OF THIS CONTENTION, THE LD A.R FILED A STATEMENT OF COMPUTA TION SHOWING AVAILABILITY OF CASH. 6. HE FURTHER SUBMITTED THAT THE ASSESSEE HAD S OLD THE POOCHUNIPADAM PROPERTY IN INSTALMENTS AND DECLARED CAPITAL GAIN THEREON. HOW EVER, ACCORDING TO THE ASSESSING OFFICER, THE ASSESSEE HAS UNDERSTATED THE SALE CONS IDERATION ALSO. HENCE THE AO ENHANCED THE SALE CONSIDERATION AND COMPUTED CAPITA L GAINS ACCORDINGLY. THE LD. AR SUBMITTED THAT THE CAPITAL GAINS WORKING MADE BY TH E ASSESSING OFFICER SUFFER FROM CERTAIN MISTAKES. THE LD. COUNSEL SUBMITTED A STATE MENT SHOWING COMPUTATION OF CAPITAL GAINS IN BOTH THE YEARS UNDER CONSIDERATION . 7. THE LD. DR SUBMITTED THAT THE ASSESSEE IS MAKING FRESH SUBMISSIONS AND FURTHER THE WORKINGS GIVEN BY THE ASSESSEE REQUIRES VERIFIC ATION AT THE END OF THE ASSESSING OFFICER. 8. WE HAVE HEARD THE RIVAL CONTENTIONS AND CAREFULL Y PERUSED THE RECORD. BEFORE US, THE ASSESSEE HAS FILED A STATEMENT SHOWING COMP UTATION OF CAPITAL GAINS IN BOTH THE YEARS, SINCE ACCORDING TO THE ASSESSEE THE COMPUTAT ION MADE BY THE ASSESSING OFFICER SUFFERS FROM CERTAIN MISTAKES. FURTHER, THE ASSESSE E HAS ALSO FURNISHED A STATEMENT SHOWING AVAILABILITY OF SUFFICIENT SOURCES FOR MAKI NG INVESTMENTS IN PURCHASE OF PROPERTIES. ACCORDING TO THE ASSESSEE, THE ASSESSI NG OFFICER HAS NOT CONSIDERED THE SOURCES SHOWN IN THE STATEMENT. THERE SHOULD NOT B E ANY DOUBT THAT THE ADDITION MADE TOWARDS UNEXPLAINED INVESTMENTS SHOULD BE COMP UTED BY CONSIDERING ALL THE AVAILABLE SOURCES. APPARENTLY, THE CLAIM OF AVAILA BILITY OF SOURCES WAS NOT EXAMINED BY BOTH THE TAX AUTHORITIES. WITH REGARD TO THE COMPU TATION OF CAPITAL GAINS ALSO, THE ASSESSEE HAS POINTED OUT CERTAIN MISTAKES IN THE WO RKINGS MADE BY THE ASSESSING OFFICER. IN SUPPORT OF BOTH THE CONTENTIONS, THE A SSESSEE HAS SUBMITTED A STATEMENT OF WORKINGS. AS SUBMITTED BY LD D.R, THE SAID WORKING S REQUIRE VERIFICATION AT THE END OF THE ASSESSING OFFICER. ACCORDINGLY, IN OUR VIEW, BO TH THE ISSUES IN BOTH THE YEARS REQUIRE FRESH EXAMINATION AT THE END OF THE ASSESSING OFFIC ER. ACCORDINGLY, WE SET ASIDE THE ORDER OF THE LD. CIT(A) ON BOTH THE ISSUES IN BOTH THE YEARS AND RESTORE THE MATTERS TO I.T.A. NOS. 227 & 228/COCH/2012 4 THE FILE OF THE AO WITH A DIRECTION TO EXAMINE BOTH THE ISSUES IN BOTH THE YEARS AFRESH DE-NOVA, INTER ALIA, BY CONSIDERING THE STATEMENTS FURNISHED BY THE ASSESSEE BEFORE US AND ALSO ANY OTHER INFORMATION AND EXPLANATIONS THA T MAY BE FILED AND TAKE APPROPRIATE DECISION ON THESE ISSUES IN ACCORDANCE WITH LAW. 9. IN THE RESULT, BOTH THE APPEALS FILED BY THE ASS ESSEE ARE TREATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED ACCORDINGLY ON 18-07-20 13. SD/- SD/- (N.R.S.GANESAN) (B.R.BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE: KOCHI DATED: 18TH JULY, 2013 GJ COPY TO: 1. SHRI BABU JOHN, VALLUPARA HOUSE, PERINCHERRY, TH RISSUR. 2. THE DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL C IRCLE, THRISSUR. 3. THE COMMISSIONER OF INCOME-TAX(APPEALS)-I, KOCHI . 4. THE COMMISSIONER OF INCOME-TAX, CENTRAL, KOCHI. 5. D.R., I.T.A.T., COCHIN BENCH, COCHIN. 6. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR) I.T.A.T, COCHIN