H. Binita Bali Singha, Silchar V. Income Tax Officer, Ward-1, Silchar

ITA 305/GTY/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 3271 (ITAT-GUWAHATI)
• Duration Of Justice: 1 year(s) 4 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-11-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 03-07-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: ANUP DUTTA
• Keywords: TDS; Set aside; FORM 26AS
• Section: 133(6); 143(1); 143(2); 131

Judgement Text

ITA NO. 305/GAU/2019 H. BINITA BALI SINGHA A.Y. 2011-12 1 | P A GE IN THE INCOME TAX APPELLATE TRIBUNAL GAUHATI BENCH, VIRTUAL HEARING AT KOLKATA ( . . , ) [BEFORE SHRI A. T. VARKEY, JM] I.T.A. NO. 305/GAU/2019 ASSESSMENT YEARS: 2011-12 H. BINITA BALI SINGHA (PAN:CIEPS 9410 A ) VS. ITO, WARD-11, SILCHAR APPELLANT RESPONDENT DATE OF HEARING (VIRTUAL) 03.11.2020 DATE OF PRONOUNCEMENT 13.11.2020 FOR THE APPELLANT SHRI ANUP DUTTA, AR FOR THE RESPONDENT SHRI AMITAVA SEN, DR ORDER THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST TH E ORDER OF LD. CIT(A)- SHILLONG DATED 01/12/2015 FOR A.Y. 2011-12. 2. BRIEF FACTS OF THE CASE AS NOTED BY THE ASSESSI NG OFFICER IS THAT THE ASSESSEE IS A PRACTICING MEDICAL PROFESSIONAL. THE RETURN OF IN COME FOR THIS RELEVANT ASSESSMENT YEAR (AY 2011-12) WAS FILED BY THE ASSESSEE ON 12. 10.2011 SHOWING TOTAL INCOME OF RS. 5,39,680/-. THE RETURN WAS PROCESSED U/S 143(1) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) ON 29.05.2012. LATER THE CASE WAS SE LECTED FOR SCRUTINY AND THE ASSESSING OFFICER ISSUED NOTICE U/S 143(2) OF THE A CT AND HAD SERVED IT UP ON THE ASSESSEE. THE ASSESSING OFFICER NOTED THAT THE ASS ESSEE HAS DECLARED GROSS RECEIPT OF RS. 7,78,639/-, AND HAD SHOWN TOTAL EXPENSES OF RS. 2,16,000/- AND NET FEES OF RS. 5,62,639/-. FROM THE DETAILS OF TDS (FORM 26AS), IT APPEARED TO THE ASSESSING OFFICER THAT THE ASSESSEE HAD RECEIVED FEE FROM PRO FESSIONAL SERVICES AMOUNTING TO RS. 14,22,679/- FROM M/S ICICI LOMBARD GENERAL INSURANC E CO. LTD., MUMBAI DURING THE FINANCIAL YEAR 2010-11. FROM THE SAID DISCUSSION, A CCORDING TO ASSESSING OFFICER, THE ITA NO. 305/GAU/2019 H. BINITA BALI SINGHA A.Y. 2011-12 2 | P A GE ASSESSEE HAD NOT DISCLOSED RECEIPTS AMOUNTING TO RS . 6,44,040/- (RS. 14,22,679/- - RS. 7,78,639/-) AND MADE AN ADDITION OF RS. 6,44,040/-. 3. AGGRIEVED THE ASSESSEE PREFERRED AN APPEAL BEFOR E THE LD. CIT(A) WHO HAS CONFIRMED THE ADDITION MADE BY ASSESSING OFFICER. 4. AGGRIEVED THE ASSESSEE IS BEFORE ME. 5. I HAVE HEARD BOTH THE PARTIES AND PERUSED THE RE CORDS. I NOTE THAT THE ASSESSEE IS A DOCTOR WHO SERVES THE POOR TRIBALS IN THE NORTH E ASTERN STATE OF ASSAM (CACHAR). IT IS NOTED THAT SHE HAS A CONTRACT FOR RENDERING SERVICE WITH M/S ICICI LOMBARD GENERAL INSURANCE COMPANY (HEREINAFTER REFERRED TO AS INSU RANCE COMPANY) AND AS PER THE AGREEMENT IN THE RELEVANT ASSESSMENT YEAR, THE ASSE SSEE IS REMUNERATED FOR CONSULTANCY OF A PATIENT FOR A FEES OF RS. 25/- ONLY. AND AS PE R THE AGREEMENT ACCORDING TO THE ASSESSEE, SHE HAS TO PROCURE MEDICINES FOR THE PATI ENTS WHOM SHE TREATS WHICH WILL BE REIMBURSED TO HER BY THE INSURANCE COMPANY. SO ACCO RDING TO LD. A.R SHRI ANUP DUTTA, THOUGH THE ASSESSEE RECEIVED RS. 13,10,357/- FROM M/S ICICI LOMBARD GENERAL INSURANCE COMPANY RS. 9,45,575/- SHE GOT AS REIMBUR SEMENT FOR PROCURING MEDICINE, AND RS. 1,73,232/- FOR THE COST INCURRED BY HER FOR CONDUCTING LABORATORY TEST ON THE PATIENTS BLOOD, URINE ETC. AND RS. 37,500/- WAS FO R INCURRING MISCELLANEOUS EXPENSES AND THUS ACCORDING TO LD. A.R AMOUNT OF RS. 11,56, 307/- WAS RECEIVED BY THE ASSESSEE ON ACCOUNT OF REIMBURSEMENT FOR PURCHASE AND DISTRI BUTION OF MEDICINE ON BEHALF OF THE INSURANCE COMPANY AND THE ASSESSEES REMUNERATI ONS WAS ONLY TO THE TUNE OF RS. 1,54,050/- I.E. CONSULTATION FEES OF RS. 25/- PER P ATIENT. THE BREAKUP OF THE RECEIPT AND UTILIZATION IS REPRODUCED BELOW AS SHOWN IN SCHEDUL E I-III : ITA NO. H. BINITA BALI SINGHA ITA NO. 305/GAU/2019 H. BINITA BALI SINGHA A.Y. 2011-12 3 | P A GE 6. HOWEVER ACCORDING TO LD. A.R WHEN THE RETURN OF INC OME (ROI) HAD TO BE FILED, THE ASSESSEE WAS PREGNANT AND COULD NOT GET CORRECT PROFESSIONAL ADVICE, SO AN ACCOUNTANT WITHOUT HAVING ANY KNOWLEDGE OF INCOME TOTAL RECEIPT (WHICH INCLUDED THE REIMBURSEMENT OF RS. 11,56,307/ COLUMN OF ROI WITHOUT STATING THE CORRECT FACTS REMUNERATION THAT THE ASSESSEE RECEIVED AND WRONGLY RET REIMBURSEMENT OF EXPENSES ON P CASE WAS TAKEN UP FOR SCRUTINY STICK TO THE ROI AND ALL THE ANSWERS GIVEN TO ASSE SSING OFFICER WERE RETURNED INCOME AS INCORRECTLY SHOWN IN THE ROI ITSELF WAS ERRONEOUS FROM THE INCEPTION, GET CONVINCED BY THE REPLIES OF ASSESSEE AND MADE THE ADDITION ASSESSEE COULD NOT RECONCILE THE MISMATCHES POINTED OUT BY THE ASSESSING OFFICER THE RETURNED INCOME VIS A VIS FORM 26AS ITA NO. H. BINITA BALI SINGHA HOWEVER ACCORDING TO LD. A.R WHEN THE RETURN OF INC OME (ROI) HAD TO BE FILED, THE ASSESSEE WAS PREGNANT AND COULD NOT GET CORRECT PROFESSIONAL ADVICE, SO AN ACCOUNTANT WITHOUT HAVING ANY KNOWLEDGE OF INCOME TAX ACT, AFTER TAKING NOTE OF THE TOTAL RECEIPT (WHICH INCLUDED THE REIMBURSEMENT OF RS. 11,56,307/ COLUMN OF ROI WITHOUT STATING THE CORRECT FACTS , THUS FAILED TO REFLECT THE ASSESSEE RECEIVED AND WRONGLY RET URNED AS INCOME THE OF EXPENSES ON P ROCUREMENT OF MEDICINE ETC . AND WHEN THE ASSESSEES CASE WAS TAKEN UP FOR SCRUTINY , THEN THE ASSESSEE WAS AGAIN ERRONEOUSLY STICK TO THE ROI AND ALL THE ANSWERS GIVEN TO ASSE SSING OFFICER WERE RETURNED INCOME AS INCORRECTLY SHOWN IN THE ROI; AND ACCORDING TO LD. A.R WAS ERRONEOUS FROM THE INCEPTION, THE ASSESSING OFFICER NATURALLY COULD NOT GET CONVINCED BY THE REPLIES OF ASSESSEE AND MADE THE ADDITION MAINLY ASSESSEE COULD NOT RECONCILE THE MISMATCHES POINTED OUT BY THE ASSESSING OFFICER THE RETURNED INCOME VIS A VIS FORM 26AS . ON APPEAL ALSO ASSESSEE FAILED TO BRING OUT ITA NO. 305/GAU/2019 H. BINITA BALI SINGHA A.Y. 2011-12 4 | P A GE HOWEVER ACCORDING TO LD. A.R WHEN THE RETURN OF INC OME (ROI) HAD TO BE FILED, THE ASSESSEE WAS PREGNANT AND COULD NOT GET CORRECT PROFESSIONAL ADVICE, SO AN TAX ACT, AFTER TAKING NOTE OF THE TOTAL RECEIPT (WHICH INCLUDED THE REIMBURSEMENT OF RS. 11,56,307/ -) FILLED UP THE THUS FAILED TO REFLECT THE CORRECT URNED AS INCOME THE . AND WHEN THE ASSESSEES AGAIN ERRONEOUSLY ADVISED TO STICK TO THE ROI AND ALL THE ANSWERS GIVEN TO ASSE SSING OFFICER WERE TO JUSTIFY THE TO LD. A.R SINCE THE THE ASSESSING OFFICER NATURALLY COULD NOT MAINLY BECAUSE THE ASSESSEE COULD NOT RECONCILE THE MISMATCHES POINTED OUT BY THE ASSESSING OFFICER WITH FAILED TO BRING OUT ITA NO. 305/GAU/2019 H. BINITA BALI SINGHA A.Y. 2011-12 5 | P A GE THE ACTUAL FACTS, SO THE LD. CIT(A) HAD NO OTHER OP TION BUT TO CONFIRM THE ADDITIONS. NOW THE ASSESSEE IS BEFORE ME REPRESENT BY LD. A.R SHRI ANUP DUTTA, WHO PLEADED THAT ASSESSEES PHYSICAL CONDITION DURING ADVANCED PREGN ANCY AND HER LACK OF KNOWLEDGE IN THE INCOME TAX COMBINED WITH THE ERRONEOUS ADVIC E OF AN ACCOUNTANT WHO TOO WAS NOT PROFICIENT IN THE SUBJECT LED TO THE FILING OF AN ROI WITH WRONG INPUTS AND THEREAFTER SHE FAILED TO CONVINCE THE ASSESSING OFF ICER AND LD. CIT(A) THE MISMATCH IN RESPECT OF THE THE TOTAL RECEIPT AND THE INCOME DEC LARED BY THE ASSESSEE IN HER ROI (I.E. RS. 14,22,679/- AND RS. 7,78,639/- RESPECTIVELY), W HICH LED TO THE ADDITION OF RS. 6,44,040/-. THE LD. A.R PLEADED THAT FOR THE MISTAK E OF FACT COMMITTED BY THE ACCOUNTANT, THE ASSESSEE WHO IS A DOCTOR AND WHO IS SERVING THE POOR AND DOWNTRODDEN IN THE HILLY TERRAINS OF THE NORTH EASTERN STATE OF ASSAM, AND WHO IS REMUNERATED ONLY A PARTLY SUM OF RS. 25 PER PATIENT, SHOULD NOT BE PENALIZED. PER CONTRA, THE LD. SR. D.R SHRI AMITAVA SEN SUBMITTED THAT THE ADDITION WAS DU E TO ACTION / OMISSION ON THE PART OF THE ASSESSEE SINCE SHE COULD NOT RECONCILE THE MISMATCH IN FORM 26AS AND THE INCOME SHOWN BY THE ASSESSEE IN ROI. ACCORDING TO T HE LD. D.R, THE LD. A.R EVEN FAILED TO FILE ANY RECONCILIATION BEFORE THE LD. CI T(A), SO THE ADDITION WAS CONFIRMED. SO HE DOES NOT WANT ME TO INTERFERE WITH THE IMPUGN ED ORDER. 7. IN THE AFORESAID BACKGROUND WHICH IS NOT AGAIN R EPEATED FOR THE SAKE OF BREVITY, I NOTE THAT WHEN THE ROI WAS FILED BY THE ASSESSEE WAS PREGNANT AND AT AN ADVANCED STAGE AND COULD NOT GET PROPER PROFESSIONAL ADVICE WHILE FILING ROI, WHICH LED TO THE FILING OF ROI, WITH WRONG INPUTS, WHICH WAS THE ROO T CAUSE OF THE IMPUGNED DECISION OF ASSESSING OFFICER AS WELL AS LD. CIT(A). SINCE THE ASSESSEE IS A DOCTOR WHO SERVES THE SOCIALLY WEAKER SECTION OF THE SOCIETY AND IN D IFFICULT HILLY TERRAIN FOR A MODEST FEES OF ONLY RS. 25/- PER PATIENT, THE ENDEAVOR SHOULD B E TO FIND OUT HER CORRECT INCOME WHICH ASSESSEE RECEIVED OTHER THAN THE REIMBURSEME NT OF THE COST OF MEDICINE/LAB EXPENSES WHICH SHE INCURRED ON BEHALF OF THE INSURA NCE COMPANY. IT IS SETTLED LAW THAT REIMBURSEMENT OF EXPENSES (IN THIS CASE THE VALUE O F MEDICINES, LAB EXPENSES ETC.) CANNOT BE TREATED AS INCOME. AND IT IS TRITE LAW TH AT EVEN IF AN ASSESSEE SHOWS MORE INCOME IN THE ASSESSEES ROI, IT NEED NOT BE ACCEPT ED AS IT IS BY THE AO FOR VARIOUS REASONS. AND EVEN THE ASSESSMENT CAN BE OF FRAMED F OR LESS INCOME THAN WHAT ASSESSEE ITA NO. 305/GAU/2019 H. BINITA BALI SINGHA A.Y. 2011-12 6 | P A GE REFLECTS IN HIS/HER ROI. MOREOVER, IT IS NOTED THAT CBDT HAS GIVEN INSTRUCTION IN EARLY 1960S ITSELF THAT ASSESSING OFFICER SHOULD NOT TAK E ANY ADVANTAGE OF THE IGNORANCE OF AN ASSESSEE AND SHOULD IN FACT ASSIST SUCH KIND OF ASSESSEES AND THE ASSESSING OFFICER SHOULD ONLY TAX THE INCOME WHICH IS CHARGEABLE AS P ER THE ACT. IN THIS CASE AS DISCUSSED ABOVE, THE MISTAKE OF FACT NEED TO BE REC TIFIED BY THE ASSESSING OFFICER AFRESH AND TAKING NOTE OF THE PECULIAR FACTS OF THE CASE, THE ASSESSING OFFICER SHOULD EXAMINE THE VERACITY OF THE SCHEDULE I TO III (SUPRA) WHICH WAS FILED BEFORE ME WHICH I HAVE REPR ODUCED AND IF NECESSARY THE ASSESSING OFFICER MAY ISSUE NOTICE U/S 133(6) OR SU MMON U/S 131 TO THE CONCERNED INSURANCE COMPANY TO FIND OUT THE CONTENTS OF THE A GREEMENT BETWEEN THE ASSESSEE AND THE INSURANCE COMPANY AND AFTER CONDUCTING THE ENQU IRY, THE ASSESSING OFFICER SHOULD TAX AS PER THE PRINCIPLE LAID BY THE HONBLE SUPRE ME COURT IN ITO VS. CH. ATCHAIAH (218 ITR 239)(SC) WHEREIN IT WAS LAID DOWN THAT ASS ESSING OFFICER SHOULD TAX AN INCOME ON THE RIGHT PERSON, RIGHT INCOME, AND IN T HE RIGHT ASSESSMENT YEAR. THEREFORE, THE IMPUGNED ORDER IS SET ASIDE AND THE MATTER IS REMITTED BACK TO ASSESSING OFFICER FOR DE-NOVO ASSESSMENT AFTER GIVI NG ADEQUATE OPPORTUNITY TO ASSESSEE / LD. A.R. THE ASSESSEE IS AT LIBERTY TO P RODUCE ALL DOCUMENTS TO SUBSTANTIATE HER CLAIM AND THE ASSESSING OFFICER TO FRAME FRESH ASSESSMENT ORDER IN ACCORDANCE TO LAW KEEPING IN MIND THE DISCUSSION SUPRA. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED FOR STATISTICAL PURPOSES. ORDER IS PRONOUNCED IN THE OPEN COURT ON 13.11.202 0. SD/- (J. SU REDDY) (A. T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 13.11.2020 SB, SR. PS ITA NO. 305/GAU/2019 H. BINITA BALI SINGHA A.Y. 2011-12 7 | P A GE COPY OF THE ORDER FORWARDED TO: 1. APPELLANT- HAORONGBA BINITA BALI SINGHA, UTTAR KRIS HNAPUR, SILCHAR-6, ASSAM- 788006. 2. RESPONDENT- ITO, WARD-11, SILCHAR 3. THE CIT(A)-SHILLONG 4. CIT- , GUWAHATI 5. DR, GAUHATI BENCH, GUWAHATI TRUE COPY BY ORDER SR. PRIVATE SECRETARY/H.O.O/DDO ITAT, GAUHATI BENCH, GUWAHATI