DCIT, CHENNAI V. Shri K.N. Pannirselvam, CHENNAI

ITA 3012/CHNY/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 0047 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-04-2017
• Appeal Filed By: Department
• Bench Allotted: D
• Next Hearing Date: 02-02-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 25-10-2016
• Court: TRIBUNAL
• Department Lawyers: R DURAIPANDIAN
• Assessee Lawyers: M P SENTHIL KUMAR
• Keywords: Business income
• Section: 143(3); 148

Judgement Text

, , IN THE INCOME - TAX APPELLATE TRIBUNAL D BENCH, CHENNAI , . , BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER & SHRI DUVVURU RL REDDY , JUDICIAL MEMBER I . T.A. NO S . 3012 AND 3013 /MDS/201 6 ASSESSMENT YEAR S :20 1 0 - 1 1 AND 2011 - 12 THE DEPUTY COMMISSIONER OF INCOME TAX, NON CORPORATE CIRCLE 2 , CHENNAI 600 034 . VS. SHRI K.N. PANNIRSELVAM, 38, PARKLAND APARTMENT, KAMALABHAI STREET, T. NAG AR, CHENNAI 600 017. [PAN: AA OPP8632M ] ( / APPELLANT ) ( / RESPONDENT ) / APPELLANT BY : SHRI R. DURAI PANDIAN, J CIT / RESPONDENT BY : SHRI M.P. SENTHIL KUMAR, ADVOCATE / DATE OF HEARING : 0 2 . 0 2 .201 7 / DATE OF P RONOUNCEMENT : 06 . 0 4 .201 7 / O R D E R PER DUVVURU RL REDDY , JUDICIAL MEMBER : BOTH THE APPEAL S FILED BY THE REVENUE IN RESPECT OF SAME ASSESSEE ARE DIRECTED AGAINST THE COMMON ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEA LS) 2 , C HENNAI DATED 2 2 . 0 8 .201 6 RELEVANT TO THE ASSESSMENT YEAR S 20 10 - 1 1 AND 2011 - 12 . THE ONLY COMMON GROUND RAISED BY THE REVENUE IS THAT THE L D. CIT(A) HAS ERRED IN DIRECTING THE ASSESSING OFFICER TO ALLOW THE AGRICULTURAL INCOME CLAIMED BY THE ASSESSEE. I.T.A. NO S . 3012 & 3013 /M/ 16 2 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL DERIVING INCOME FROM HOUSE PROPERTY, BUSINESS AND INCOME FROM OTHER SOURCES. HE CARRIES ON TWO BUSINESS ACTIVITIES IN THE NAME AND STYLE OF M/S. PLANT SCAPE AND M/S. FLOWERS AND PEALS. W HILE THE INCOME FROM M/S. PLANT SCAPE WAS OFFERED FOR TAX, THE INCOME FROM M/S. FLOWERS AND PETALS ARE CLAIMED EXEMPT AS AGRICULTURAL INCOME. THE ASSESSEE FILED THE RETURN OF INCOME ON 05.01.2012 ADMITTING AN INCOME OF .10,47,480/ - AND OFFERED AN INCOME O F .28,34,580/ - FROM M/S. FLOWERS AND PETALS AND CLAIMED THE SAME AS AGRICULTURAL INCOME. THE ASSESSMENT WAS TAKEN UP FOR SCRUTINY AND THE SAME WAS COMPLETED UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 [ ACT IN SHORT] ON 13.03.2013 ON A TOTAL INCOME OF .15,86,430/ - BY ACCEPTING AGRICULTURAL OF .28,34,580/ - OFFERED BY THE ASSESSEE. THEREAFTER, IT WAS NOTICED THAT THE ASSESSEE WAS WRONGLY ALLOWED EXEMPTION OF AGRICULTURAL INCOME ON .28,34,580/ - , NOTICE UNDER SECTION 148 OF THE ACT WAS ISSUED ON 23.10 .2014 FOR REOPENING THE ASSESSMENT. THEREAFTER, NOTICE UNDER SECTION 143(2) OF THE ACT WAS ISSUED AND IN RESPONSE THERETO, THE DETAILS WERE FURNISHED BEFORE THE ASSESSING OFFICER. AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND VERIFYING THE DETAILS FURNISHED BY THE ASSESSEE, THE ASSESSMENT UNDER SECTION 143(3) R.W.S. 147 OF THE ACT WAS COMPLETED ON 11.08.2015 ASSESSING TOTAL INCOME OF THE ASSESSEE AT .44,55,598/ - AFTER MAKING VARIOUS DISALLOWANCES. I.T.A. NO S . 3012 & 3013 /M/ 16 3 3. THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A). WITH REGARD TO THE GROUND OF JURISDICTION UNDER SECTION 147 OF THE ACT, THE LD. CIT(A) SUSTAINED THE ORDER OF THE ASSESSING OFFICER. IN RESPECT OF GROUND OF DISALLOWANCE OF AGRICULTURAL INCOME AND TREATING THE SAME AS BUSINESS INCOME FOR BOTH THE ASSESSMENT YEARS 2010 - 11 AND 2011 - 12 , BY FOLLOWING THE RECENT DECISION OF THE TRIBUNAL IN ASSESSEE S OWN CASE FOR THE ASSESSMENT YEAR 2004 - 05 TO 2006 - 07 & 2008 - 09 DATED 29.01.2016, THE LD. CIT(A) DELETED THE ADDITION S MADE BY THE ASSESSING OFFICER. 4. ON BEING AGGRIEVED, THE REVENUE IS IN APPEAL FOR BOTH THE ASSESSMENT YEARS. 5. AT THE TIME OF HEARING, BY FILING COPY OF THE JUDGEMENT OF THE HON BLE MADRAS HIGH COURT, THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT AGAINST THE ORDER OF THE TRIBUNAL FOR THE ASSESSMENT YEAR 2008 - 09 IN I.T.A. NO. 2111/MDS/2015, THE DEPARTMENT PREFERRED FURTHER APPEAL AND THE HON BLE JURISDICTIONAL HIGH COURT SUSTAINED THE ORDERS OF THE TRIBUNAL. THEREFORE, THE LD. COUNSEL FOR THE ASSESSEE HAS PLEADED THAT THE ISSUE INVOLVED IN BOTH THE APPEALS ARE SQUARELY COVERED IN FAVOUR OF THE ASSESSEE AND PRAYED THAT THE SAME SHOULD BE FOLLOWED FOR THE ASSESSMENT YEARS UN DER CONSIDERATION. ON THE OTHER HAND, THE LD. DR COULD NOT CONTROVERT THE SUBMISSIONS OF THE LD. COUNSEL. I.T.A. NO S . 3012 & 3013 /M/ 16 4 6. WE HAVE HEARD BOTH SIDES, PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. WE HAVE ALSO PERUSED T HE PAPER BOOKS, WHEREIN COPIES OF ORDERS OF THE HON BLE JURISDICTIONAL HIGH COURT HAVE BEEN FILED. THE POINT AT ISSUE RAISED IN BOTH THE APPEALS OF THE REVENUE IS WHETHER THE INCOME DERIVED FROM GRO WING NURSERY PLANTS FALLS WITHIN THE DEFINITION OF AGRICULTURAL INCOME AND EXEMPTED UNDER SECTION 10(1) OF THE ACT. IN SIMILAR FACTS AND CIRCUMSTANCES ON AN IDENTICAL ISSUE RAISED IN THE ASSESSMENT YEARS 2004 - 05 TO 2006 - 07 AND 2008 - 09 VIDE ORDER DATED 29.01.2016, BY FOLLOWING THE DECISION OF THE COORDIN ATE BENCHES OF THE TRIBUNAL IN ASSESSEE S OWN CASE FOR THE ASSESSMENT YEAR 2007 - 08 IN I.T.A. NO. 667/MDS/2015 DATED 30.09.2015, DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE, WHEREIN THE DECISION OF THE HON BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT V. SOUNDARYA NURSERY 241 ITR 530 AND THE DECISION OF THE AHMEDABAD BENCHES OF THE TRIBUNAL IN THE CASE OF CIT V. BEST ROSES BIOTECH (P) LTD. 17 ITR (TRIB) 211 HAVE BEEN FOLLOWED AND DISMISSED THE APPEALS FILED BY THE REVENUE. AGAINST THE ORDERS OF THE TRIBUN AL FOR THE ASSESSMENT YEARS 2004 - 05 TO 2006 - 07 AND 2008 - 09 IN I.T.A. NO S . 2108 TO 2111/MDS/2015, THE DEPARTMENT PREFERRED FURTHER APPEAL S AND THE HON BLE JURISDICTIONAL HIGH COURT IN TAX CASE APPEAL NOS. 617 TO 620 OF 2016 VIDE ORDER DATED 01.09.2016, SUST AINED THE ORDERS OF THE TRIBUNAL AND DISMISSED THE APPEALS FILED BY THE DEPARTMENT . UNDER THE ABOVE FACTS AND CIRCUMSTANCES, WE FIND NO REASON TO INTERFERE WITH THE ORDERS OF THE LD. I.T.A. NO S . 3012 & 3013 /M/ 16 5 CIT(A) AND DISMISS THE GROUND RAISED BY THE REVENUE FOR BOTH THE ASSESSME NT YEARS. 7 . IN THE RESULT, BOTH THE APPEAL S FILED BY THE REVENUE ARE DISMISSED. ORDER PRONOUNCED ON THE 06 TH APRIL , 201 7 AT CHENNAI. SD/ - SD/ - (CHANDRA POOJARI) ACCOUNTANT MEMBER ( DUVVURU RL REDDY ) JUDICIAL MEMBER CHENNAI, DATED, THE 06 . 0 4 .201 7 VM/ - / COPY TO: 1. / APPELLANT , 2. / RESPONDENT , 3. ( ) / CIT(A) , 4. / CIT , 5. / DR & 6. / GF.