Uttaraben Harsidhbhai Shah, Ahmedabad V. The Income tax Officer,Ward-7(1), Ahmedabad

ITA 2572/AHD/2010

• Counselvise Citation: [2011] 135 COUNSELVISE.COM (IT) 1993 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-02-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 04-02-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 27-08-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Salary income

Judgement Text

- 1 - IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH B AHMEDABAD BEFORE S/SHRI BHAVNESH SAINI, JM AND D.C.AGRAWAL, A M UTTARABEN HARSIDHBHAI SHAH, 103-104, SAPATH-II, OPP. RAJPATH CLUB, S-G HIGHWAY, BODAKDEV, AHMEDABAD. VS. INCOME-TAX OFFICER, WARD- 7(1), AHMEDABAD. (APPELLANT) .. (RESPONDENT) APPELLANT BY :- SHRI KALPESH SHAH, AR RESPONDENT BY:- SHRI K. MADHUSUDAN, SR.DR O R D E R PER D.C. AGRAWAL, ACCOUNTANT MEMBER . THIS IS AN APPEAL FILED BY THE ASSESSEE RAISING FO LLOWING GROUND :- (1) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, SALARY PAID OF RS.48,000/- TO ACCOUNTANT SHOULD BE ALLOWED U/S 57 OF THE ACT, FROM INCOME FROM OTHER SOURCE OF RS.445,322/- 2. THE FACTS OF THE CASE ARE THAT ASSESSEE CLAIMED PAYMENT OF RS.48,000/- AS REMUNERATION PAID TO AN ACCOUNTANT A GAINST INCOME FROM OTHER SOURCES AT RS.4,45,322/-. THE CASE OF THE ASS ESSEE BEFORE THE AO WAS THAT SHE USED THE SERVICES OF AN ACCOUNTANT WHO CARRIED ON THE TRANSACTIONS FOR HER AS SHE IS BUSY IN HER EMPLOYME NT. THE AO DISAGREED AND DISALLOWED THE CLAIM OF REMUNERATION ON THE GRO UND THAT IT IS NOT RELATED TO EARNING OF INCOME FROM OTHER SOURCES. ITA NO.2572/AHD/2010 ASST. YEAR 2007-08 ITA NO.2572/AHD/2010 ASST. YEAR2007-08 2 3. THE LD. CIT(A) ALSO DISMISSED THE APPEAL OF ASSE SSEE BY HOLDING AS UNDER :- 2.2 I HAVE CONSIDERED THE SUBMISSIONS MADE BY THE AR OF THE APPELLANT AND THE OBSERVATIONS OF THE ASSESSING OFFICER IN TH E ASSESSMENT ORDER. AS SEEN FROM STATEMENT OF INCOME ANNEXED TO RETURN O F INCOME APPELLANT DERIVED INCOME FROM SALARIES OF RS.1,06,293/-. HOUS E PROPERTY OF RS.16,800/-, SHORTERM CAPITAL GAINS OF RS.75,446/- AND INCOME FROM OTHER SOURCES OF RS.4,45,322/- (WHICH COMPRISED OF INTERE ST INCOME OF FROM S.B.ACCOUNT DIVIDEND AND POST OFFICE INTEREST ETC. TOTALING TO RS.40,531/- AND INTEREST INCOME FROM BONDS OF RS.4,01,623/-). A PPELLANT IS NOT ABLE TO MAKE OUT ANY CASE THAT THE IMPUGNED EXPENSES WERE F OR EARNING INCOME FROM OTHER SOURCES. APPELLANTS EXPLANATION IS GENE RAL AND VAGUE. GOING BY THE NATURE OF EXPENSES CLAIMED, I DO NOT SEE ANY NEXUS BETWEEN THE INCOME AND EXPENDITURE. THEREFORE, AOS ACTION IS U PHELD. THIS GROUND OF APPEAL IS DISMISSED. 4. NON ONE APPEARED ON BEHALF OF ASSESSEE BEFORE US . ONLY A WRITTEN SUBMISSION WAS FILED AS UNDER :- I AM ASSESSED TO TAX REGULARLY SINCE LAST MORE THA N 20 YEARS. I HAVE BEEN FILING MY RETURNS OF INCOME AND WEALTH TAX EVERY YE AR. THE PREVIOUS YEAR ENDED ON 31.03.2007 WAS SUBJECT TO SCRUTINY ASSESSM ENT AND LEARNED INCOME-TAX OFFICER HAS DISALLOWED SALARY PAID OF RS .48,000/- TO ACCOUNTANT LOOKING AFTER MY ACCOUNTS AND MONEY RELA TED MATTERS. FACT REMAINS THAT I AM A WORKING WOMAN AND IS HAVIN G SALARY INCOME, HOUSE PROPERTY INCOME, CAPITAL GAINS AND OTHER INTE REST IN FORM OF SAVINGS BANK INTEREST, BOND INTEREST, POST OFFICE INTEREST ETC. IN PAST I HAVE EXPERIENCED LOT OF DIFFICULTY IN KEE PING TRACK OF MY INVESTMENTS AND INCOME EARNED FROM INVESTMENT. I FA ILED TO DEPOSIT CHEQUES RECEIVED INTO MY BANK ACCOUNT. I USE TO HAV E SURPLUS MONEY IN MY BANK ACCOUNTS FOR MONTHS. I REALIZED THAT I HAVE NO TIME TO MANAGE MY SURPLUS MONEY. FURTHER I HAVE NO SKILL OR PRUDENCE TO INVEST MY SURPLUS MONEY SAFELY. ITA NO.2572/AHD/2010 ASST. YEAR2007-08 3 I HAVE SOCIAL RESPONSIBILITIES TOO AND THEREFORE I HAVE AVAILED SERVICES OF SENIOR PERSON TO LOOK AFTER MY FINANCE. HE IS RESPO NSIBLE FOR REALIZATION, INVESTMENT, REINVESTMENTS AND SAFE-KEEPING OF ALL M Y MONEY. THUS SALARY PAID TO HIM FOR HIS SERVICES ARE FOR PR OPER AND IN TIME MANAGEMENT OF MY INVESTMENT AND INCOME. WHICH IN TU RN RESULT IN EARNING OF INTEREST INCOME. THERE ARE OTHER BENEFIT S. I AM SPARED FROM LOT OF MENTAL STRESS AND TENSION. I ALSO SAVE QUALITY T IME. THEREFORE, I BELIEVE THAT EXPENSE CLAIMED BY ME IS LOGICALLY CORRECT. TH E EXPENSE IS INCURRED FOR EARNING OF INCOME ONLY. I HAVE ALSO SPENT MONEY WORTH RS.36,900/- FOR CHART ERED ACCOUNTANTS SERVICES DURING THE YEAR. HOWEVER, I HAVE NOT CLAIM ED THE EXPENSE AGAINST ANY INCOME. BUT SALARY PAID HAS NEXUS WITH INCOME EARNED. SALARY IS PAID PRIMARILY FOR SAFE KEEPING OF MY INV ESTMENT AND TIMELY INVESTMENT AND REINVESTMENT OF MONEY I HAVE. I AM ADVISED THAT THIS IS MY LAST CHANCE TO PROVIDE CLARIFICATION IN RESPECT OF CLAIM OF EXPENDITURE. I HAVE MADE MY CASE TO THE BEST OF MY ABILITY AND SHALL ACCEPT YOUR VERDICT AS FINAL. 5. THE LD. DR ON THE OTHER HAND OPPOSED THE CLAIM O F THE ASSESSEE ON THE GROUND THAT EARNING OF INTEREST INCOME FROM BON DS ASSESSED UNDER OTHER SOURCES WAS NATURAL, AUTOMATIC AND THERE IS NO ROLE OF ACCOUNTANT IN THIS REGARD. 6. WE HAVE HEARD THE LD. DR AND CAREFULLY PERUSED T HE SUBMISSION MADE BY THE ASSESSEE. IN OUR CONSIDERED VIEW THE AS SESSEE HAS FAILED TO ESTABLISH THE NEXUS BETWEEN THE SERVICES RENDERED B Y THE ACCOUNTANT AND EARNING OF INTEREST INCOME. ASSESSEE HAS SHOWN INTE REST INCOME FROM BOND AT RS.4,01,623/-. THESE BONDS WERE PURCHASED I N EARLIER YEARS AND THEREFORE EARNING INTEREST INCOME AND ITS CREDIT IN THE ACCOUNT IS PRACTICALLY AUTOMATIC AND THERE IS NO ROLE OF ANY A CCOUNTANT IN EARNING SUCH INCOME. THUS IN ABSENCE OF ANY EVIDENCE OF SER VICES RENDERED BY ITA NO.2572/AHD/2010 ASST. YEAR2007-08 4 ACCOUNTANT IN EARNING SUCH INTEREST INCOME, WE UPHO LD THE ORDER OF LD. CIT(A). AS A RESULT, APPEAL FILED BY THE ASSESSEE I S DISMISSED. 7. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS D ISMISSED. ORDER WAS PRONOUNCED IN OPEN COURT ON 11.2.11. SD/- SD/- (BHAVNESH SAINI) (D.C. AGRAWAL) JUDICIAL MEMBER ACCOUNTANT MEMB ER AHMEDABAD, DATED : 11.2.11. MAHATA/- COPY OF THE ORDER FORWARDED TO :- 1. THE ASSESSEE. 2. THE REVENUE. 3. THE CIT(APPEALS)- 4. THE CIT CONCERNS. 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER, DEPUTY / ASSTT.REGISTRAR ITAT, AHMEDABAD 1.DATE OF DICTATION 7/2/2011 2.DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE TH E DICTATING 8/2/ 2011 MEMBER.OTHER MEMBER. 3.DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S. 4.DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT.. 5.DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR .P.S./P.S 6.DATE ON WHICH THE FILE GOES TO THE BENCH CLERK .. 7.DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8.THE DATE ON WHICH THE FILE GOES TO THE ASSTT. REG ISTRAR FOR SIGNATURE ON THE ORDER 9.DATE OF DESPATCH OF THE ORDER ..