Income Tax Officer-Ward-28, Kolkata, Kolkata V. Suchismita Majumder, Kolkata

ITA 2648/KOL/2013

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 4074 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 1 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-12-2016
• Appeal Filed By: Department
• Bench Allotted: C
• Next Hearing Date: 14-12-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 21-11-2013
• Court: TRIBUNAL
• Department Lawyers: BANIBRATA DUTTA
• Assessee Lawyers: PRAVIN LUHARKA
• Keywords: Rectification of order; Principle of natural justice
• Section: 143(3); 154

Judgement Text

1 ITA NO.2648/KOL/2013 SUCHISMITAMAJUMDER IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATAD BENCH, KOLKATA BEFORE SHRI S.S.VISWANETHRA RAVI, HONBLE JUDICIAL MEMBER AND DR.A.L. SAINI, HONBLE ACCOUNTANT MEMBER ITA NO.2648/KOL/2013 (AY : 2006-2007) ACIT, CIRCLE-28,KOLKATA AAYAKARBHAWANDAKSHIN, 2, GARIAHAT ROAD (SOUTH), KOLKATA-700068 VS. SUCHISMITAMAJUMDER, 49/58, PRINCE GOLAMMD SHAH ROAD, KOLKATA-700033 PAN NO.AFEPM0600F (APPELLANT) (RESPONDENT) ASSESSEE BY :PRAVIN LUHARKA, CA DEPARTMENT BY : SHRI BANIBRATA DUTTA, JCIT DATE OF HEARING : 14/12/2016. DATE OF PRONOUNCEMENT : 21/12/2016. O R D E R PERDR. ARJUN LAL SAINI, A. M. THE CAPTIONED APPEAL FILED BY THE REVENUE, PERTAINI NG TO ASSESSMENT YEAR 2006-07, IS DIRECTED AGAINST THE OR DER PASSED BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-XIV, KOLKA TA, DATED 24.08.2013, WHICH IN TURN ARISES OUT OF AN ORDER PA SSED BY THE ASSESSING OFFICER (AO), UNDER SECTION 143(3)/154 OF THE INCOME TAX ACT, 1961, ( IN SHORT,THE ACT), DATED 29.04.2008. 2. THE BRIEF FACTS QUA THE ASSESSEE IS THAT REGULAR ASSESSMENT U/S 143(3) WAS MADE ON 29.04.2008 AT A TOTAL INCOME OF RS.6,05,490/-. LATER ON IT WAS FOUND BY THE ASSESSING OFFICER THAT PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31.03.2006 REVEALED THAT THE ASSESSEE EARNED INCOME TOWARDS COMMISSION AND OTHER RECEIPTS AT RS.51,63,969/-. THE ABOVE INCOME INCLUDED COMMISSIO N INCOME FROM 2 ITA NO.2648/KOL/2013 SUCHISMITAMAJUMDER INDIAN OIL CORPORATION LTD, OF RS.30,83,646/-. HOWE VER, SCRUTINY OF TDS CERTIFICATE ISSUED THE IOC LTD. FOR THE PERIOD FROM 2005-06 REVEALED THAT THE ASSESSEE HAD RECEIVED INCOME TO THE TUNE OF RS. 34,05,364/- AGAINST TDS OF RS. 1,78,042. IT APPEARED TO THE ASSESSING O FFICER THAT COMMISSION INCOME TO THE TUNE OF RS. 3,21,718/- ( R S.34,05,364 RS.30,83,646) WAS NOT ACCOUNTED FOR IN THE PROFIT A ND LOSS ACCOUNT FOR THE YEAR ENDED 31.03.2006 LEADING TO UNDER ASSESSME NT OF INCOME. AS IT WAS A MISTAKE APPARENT FROM RECORD THEREFORE THE ASSESSING OFFICER PASSED A RECTIFICATION ORDER U/S 154 OF THE I.T. AC T. IN THE SAID RECTIFICATION ORDER, THE ASSESSING OFFICER MADE ADD ITION OF RS. 3,21,718/- BEING COMMISSION RECEIVED FROM IOC LTD, WHICH WAS NOT INCLUDED IN THE PROFIT AND LOSS ACCOUNT. 3. AGGRIEVED FROM THE ORDER OF THE ASSESSING OFFIC ER, THE ASSESSEE FILED AN APPEAL BEFORE THE LD.CIT(A), WHO HAS DELETED THE ADDITION MADE BY ASSESSING OFFICER OBSERVING THE FOLLOWINGS: 5.2.IN MY CONSIDERED VIEW, THE ACTION OF THE A.O. OF INVOKING THE PROVISIONS OF SEC.154 OF THE ACT CANNOT, BY ANY MEANS, BE MAINTAINED PROPERLY BECAUSE THE ORIGINAL ASSESSMENT IN THE INSTANT CASE PASSED U/S. 143(3) OF THE ACT WAS CORR ECT AND THERE IS NO OUTSTANDING TAX DUES TO THE ASSESSEE/APPELLAN T. I HOLD THAT THE A.O.'S ACTION OF RAISING A DEMAND OF RS. 1,24,8 10/- INCORRECTLY BY INVOKING THE PROVISIONS OF SEC. 154 OF THE ACT IN THE CASE OF THE APPELLANT IS NOT IN ACCORDANCE WITH LAW. THE A.O. SEEMS NOT TO HAVE APPLIED HIS MIND PROPERLY IN EXAM INING THE SUBSTANCE AND MERIT OF THE INSTANT CASE OF THE ASSE SSEE WHILE PASSING THE MISTAKEN ORDER U/S. 154 OF THE ACT. MOR EOVER, THE A.O. HAS ALSO COMMITTED A MISTAKE IN MAKING THE STA TUS OF THE APPELLANT UNDER RECTIFICATION. I UPHOLD THAT THE OR DER PASSED BY A.C.I.T, CIRCLE-28, KOLKATA, U/S 143(3)/154 OF THE ACT IS BASED ON BIAS/PREJUDICE AND ONE SIDED. IF THE CONTENTION OF THE A.O. IS ACCEPTED, THEN THE ASSESSEE WILL BE SUFFERING BY PA YING TAX DOUBLY ON THE SAME AMOUNT WHILE IN THE CORRESPONDIN G ASSESSMENT YEAR NO TDS WAS CLAIMED BY THEASSESSEE. NATURALLY, IF THE ORDER PASSED BY THE A.O. U/S. 154 OF THE ACT IS CONFIRMED, THEN THEASSESSEE HAVE TO PAY TWICE ON A SINGLE AMOU NT WHICH, IS DEVOID OF NATURAL JUSTICE. HENCE, THE AMOUNT OF RS. 1,24,810/- WHICH THE A.O. HAS INCORRECTLY RAISED AS DEMAND BY PROVOKING THE PROVISIONS OF SEC. 154 OF THE ACT, IS DELETED. ACCORDINGLY, THE GROUND NO.1 OF THE INSTANT APPEAL SUCCEEDS AND THE APPELLANT GETS RELIEF OF RS.1,24,810/-. 3 ITA NO.2648/KOL/2013 SUCHISMITAMAJUMDER 4. NOT BEING SATISFIED WITH THE ORDER OF THE LD.CIT (A), THE REVENUE IS IN FURTHER APPEAL BEFORE US AND HAS TAKEN THE FOLLOWIN G GROUNDS OF APPEAL:- 1.WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CA SE, THE LD.CIT (A) WAS RIGHT IN LAW AS WELL AS ON FACTS IN DELETING THE ADDITION OF UNDISCLOSED COMMISSION INCOME BY HOLDIN G THAT COMMISSION WAS DISCLOSED IN A.Y. 2005-06, THOUGH TD S WAS CLAIMED IN A.Y. 2006-07. 2.WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CAS E, THE LD.CIT(A) WAS RIGHT IN LAW AS WELL AS ON FACTS IN N OT CONSIDERING THE FACT THAT INCOME IS ASSESSABLE IN THE YEAR, IN WHICH CORRESPONDING TDS IS CLAIMED. 3.THAT THE APPELLANT CRAVES LEAVE TO ADD,ALTER,MODI FY,DELETE OR INCLUDE ANY OF THE GROUNDS OF APPEAL. 5.LD. DR FOR THE REVENUE HAS SUBMITTED BEFORE US TH AT THE ASSESSEE HAD DISCLOSED THE COMMISSION INCOME IN A.Y. 2005-06 , THOUGH THE TDS WAS CLAIMED BY THE ASSESSEE IN THE A.Y. 2006-07, WH ICH IS WRONG. THE INCOME SHOULD BE ASSESSABLE IN THE YEAR IN WHICH CO RRESPONDING TDS WAS CLAIMED. IN THE INSTANT CASE THERE IS A COMPLET E MISMATCH THEREFORE THIS ISSUE SHOULD BE REMIT BACK TO THE FI LE OF THE AO FOR STATISTICAL PURPOSES TO RECTIFY THE MISTAKE. 5.1 LD AR FOR THE ASSESSEE HAS SUBMITTED THAT ASSES SEE CLAIMED THE TDS IN THE A.Y. 2006-07 AND DISCLOSED THE DETAILS B Y WAY OF ANNEXURE-B BEFORE THE LD CIT (A). THE LD. AR ALSO SUBMITTED BE FORE US THAT IN COMPUTATION OF TAXABLE INCOME, IN THE LEDGER ACCOUN T OF ASSESSMENT YEAR 2005-06, THE NET COMMISSION EARNED DURING THE YEAR WAS RS.8,58,985/- WHICH INCLUDES ALLEGED AMOUNT BUT NO TDS WAS CLAIMED ON THE ALLEGED AMOUNT, AND ASSESSEE SUBMITTED DETAI LS BEFORE THE LD CIT(A) THROUGH ANNEXURE-C. HOWEVER, THE LD AR COULD NOT PRODUCE BEFORE US ANNEXURE-B AND ANNEXURE-C, TO SEE TRUTH O F THE MATTER. 5.2 THE LD. DR FOR THE REVENUE HAS SUBMITTED THAT A SSESSEE NEVER FILED ANY DETAILS BEFORE THE LD.CIT(A). ANNEXURE B AND A NNEXURE-C HAD NOT BEEN FILED BY THE ASSESSEE. THERE IS A COMPLETE MIS MATCH BETWEEN THE COMMISSION INCOME EARNED AND TDS CLAIMED, THAT IS T DS PERTAINS TO 4 ITA NO.2648/KOL/2013 SUCHISMITAMAJUMDER A.Y. 2006-07 WHEREAS COMMISSION INCOME PERTAINS TO A.Y. 2005-06. THERE IS NO ANY CORRELATION BETWEEN THE COMMISSION INCOME AND TDS. LD CIT (A) DID NOT GIVE ANY FINDINGS AS TO WHETHER TDS PERTAINS TO COMMISSION EARNED IN A.Y. 2005-06. THEREFORE, THIS ISSUE REQUIRES EXAMINATION AT THE END OF THE ASSESSING OFFICER. 5.3 HAVING HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD, WE ARE OF THE VIEW THAT THERE IS MERIT I N THE SUBMISSIONS OF THE DEPARTMENTAL REPRESENTATIVE (DR), AS THE PROPOS ITIONS CANVASSED BY THE LD DR FOR THE REVENUE ARE SUPPORTED BY THE F ACTS NARRATED BY HIM. AS HE POINTED OUT THAT THE ASSESSEE HAS SUBMIT TED ANNEXURE-B AND ANNEXURE-C BEFORE THE LD CIT(A), BUT THE LD CIT (A) DID NOT WORK ON THEM TO FIND OUT THE RELATIONSHIP BETWEEN COMMISSIO N EARNED AND TDS. THE LD CIT(A) FAILED TO ESTABLISH THE NEXUS BETWEEN COMMISSION EARNED AND TDS. THE COMMISSION EARNED PERTAINS TO A.Y. 20 05-06 WHEREAS TDS PERTAIN TO A.Y. 2006-07. HOW THE ASSESSEE CAN T AKE THE BENEFIT OF TDS WHICH PERTAINS TO DIFFERENT ASSESSMENT YEARS. H ENCE THERE IS A LOT OF AMBIGUITY BETWEEN THE ASSESSMENT ORDER AND THE O RDER PASSED BY THE LD CIT(A). THEREFORE, WE ARE OF THE VIEW THAT T HIS ISSUE REQUIRES A FRESH EXAMINATION AT THE END OF THE ASSESSING OFFIC ER. WE DIRECT THE ASSESSING OFFICER TO EXAMINE THE TDS FOR A.Y. 2006- 07 AND TO SEE WHETHER IT PERTAINS TO COMMISSION EARNED IN A.Y. 20 05-06 OR NOT AND TO EXAMINE THE OTHER RELEVANT DOCUMENTS OF THE ASSESSE E TO ASCERTAIN THE CORRECTNESS OF THE CLAIM. ACCORDINGLY, WE REMIT THE CASE BACK TO THE FILE OF THE AO TO EXAMINE THE ISSUE AS PER THE DIRECTION GIVEN (SUPRA). 5.4 IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 21/12/2016. SD/- SD/- (S.S.VISWANETHRA RAVI) (DR. A.L. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 21/12/ 2016. PKM .SR.PS/- 5 ITA NO.2648/KOL/2013 SUCHISMITAMAJUMDER / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-ACIT, CIR-28, KOLKATA 2. /RESPONDENT-SUCHISMITA MAJUMDER 3. / CONCERNED CIT 4. - / CIT (A) 5. ! ''#,%& / DR, ITAT, KOLKATA 6. !)*+, / GUARD FILE. BY ORDER/ , % &,