PRITI NIMISH PATEL, MUMBAI V. DCIT - CC-25, MUMBAI

ITA 3069/MUM/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 8076 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-03-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 28-12-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 21-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAHUL RAMANDR
• Assessee Lawyers: ARATI DESHMUKHAR
• Keywords: Business income; Search and seizure; Revised return

Judgement Text

, , , , INCOME-TAX APPELLATE TRIBUNAL -HBENCH MUMBAI , , , BEFORE S/SHRI RAJENDRA,ACCOUNTANT MEMBER AND RAM LAL NEGI,JUDICIAL MEMBER ./I.T.A./3069/MUM/2015 , /ASSESSMENT YEAR: 2010-11 PRITI NIMISH PATEL SHARDA, 51, HATKESH SOCIETY, 7TH FLOOR, JUHU SCHEME, VILE PARLE MUMBAI-400 049. PAN:AAQPS 2319 Q VS. DCIT, CC-25 AAYAKAR BHAVAN, M.K. ROAD MUMBAI. ( /APPELLANT ) ( / RESPONDENT ) REVENUE BY: SHRI RAHUL RAMAN-DR ASSESSEE BY: MS. ARATI DESHMUKH-AR / DATE OF HEARING:21.02.2017 / DATE OF PRONOUNCEMENT: 07.03.2017 ,1961 254(1) ORDER U/S.254(1)OF THE INCOME-TAX ACT,1961(ACT) PER RAJENDRA, AM - CHALLENGING THE ORDER DATED 23/02/2015,OF THE CIT(A )-51,MUMBAI,THE ASSESSEE HAS FILED THE PRESENT APPEAL.ASSESSEE,AN INDIVIDUAL,IS CARRYING ON BUSINE SS OF MANUFACTURING AND SALE OF METALLIC YARN.DURING THE YEAR UNDER APPEAL,SHE WAS ALSO DIRE CTOR OF ONE COMPANY.EFFECTIVE GROUND OF APPEAL IS ABOUT TAXABILITY OF RS. 26.40 LAKHS UNDER THE HEAD BUSINESS INCOME. BRIEF FACTS: 2. A SEARCH AND SEIZURE OPERATION U/S.132 OF THE ACT W AS CONDUCTED IN THE CASE OF PATEL ENGINEERING LTD. GROUP OF CASES, ON 16/12/2010. AFTER RECORDING SATISFACTION, A NOTICE U/S.153C OF THE ACT WAS ISSUED TO THE ASSESSEE ASKING HER TO FILE THE RETUR N OF INCOME FOR THE YEAR UNDER CONSIDERATION.SHE FI LED HER RETURN ON 16/01/2013, DECLARING TOTAL INCOME AT RS. 21.48 LAKHS.LATER ON, ON 27/02/2013, THE ASSESSEE FILED A REVISED RETURN DISCLOSING INCOME O F RS. 15.89 LAKHS.THE ASSESSEE HAD OFFERED INCOME OF RS. 26,40,000/-WAS OFFERED UNDER THE HEAD INCOME FROM HOUSE PROPERTY, WHEREAS, THE AO FOLLOWING THE ORDER FOR THE AY.2010-11 ASSESSED THE SAID INCO ME UNDER THE HEAD BUSINESS INCOME. IN THE APPELLATE PROCEEDINGS, THE FIRST APPELLATE AUTHORIT Y (FAA)CONFIRMED THE ORDER OF THE AO. 3. BEFORE US THE REPRESENTATIVES OF BOTH THE SIDES AGR EED THAT THE ISSUE STANDS DECIDED IN FAVOUR OF THE ASSESSEE BY THE ORDER OF THE TRIBUNAL DATED 27/07/2 016(ITA/3070/MUMBAI/2015,AY. 2011-12).WE WOULD LIKE TO REPRODUCE THE SAID ORDER AND IT READS AS UNDER: 2.THE ONLY GRIEVANCE OF THE ASSESSEE RELATES TO ASSESSING RENTAL INCOME OF RS.29,04, 000/-OFFERED UNDER THE HEAD INCOME FR OM HOUSE PROPERTY,AS BUSINESS INCOME. 3069/M/15(10-11) PRITI NIMISH PATEL 2 3.RIVAL CONTENTIONS HAVE BEEN HEARD AND RECOR D PERUSED. FACTS IN BRIEF ARE THAT CONSEQUENT TO CLOSURE OF BUSINESS, THE ASSESSEE HAS GIVEN ITS PROPERTY ON RENT AND WAS IN RECEIPT OF LICENCE FEE INCOME OF RS.29,04,000/-, WHICH WAS OFFERED AS INCOME FROM HOUSE PROPERTY. DURING THE COURSE OF ASSESSMENT THE AO OBSERVED THAT SIMILAR INCOME WAS ASSESSED AS BUSINESS INCOME IN THE ASSESSMENT YEAR 2009-2010, BUT THE ASSESSEE HAS NOT FILED ANY APPEAL AGAINST THAT ORDER, ACCORDINGLY HE TREATED THE INCOME FROM HOUSE PROPERTY AS BUSINESS INCOME .BY THE IMPUGNED ORDER CIT(A) CONFIRMED THE ACTION OF AO, AGAINST WHICH ASSESSEE IS IN FURTHER APPEAL BEFORE US. 4.I DO NOT FIND ANY MERIT IN THE ORDERS OF LOWER AU THORITIES, INSOFAR AS THE ISSUE IS DIRECTLY COVERED BY THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF SHAMBHU INVESTMENTS PVT. LTD.,263 ITR 143, WHEREIN IT WAS HELD T HAT INCOME REALISED BY OWNER BY WAY OF RENTAL INCOME FROM A BUILDING IS ASSESSABL E UNDER THE HEAD INCOME FROM HOUSE PROPERTY.MERELY BECAUSE IN THE ASSESSMENT YEAR 2009-10,THE ASSESSEE HAS NOT FILED ANY APPEAL AGAINST THE TREATMENT OF INCOME O FFERED UNDER THE HEAD INCOME FROM HOUSE PROPERTY AS BUSINESS INCOME,WILL NOT PR ECLUDE THE ASSESSEE TO PUT A RIGHTFUL CLAIM OF ITS INCOME WHICH IS DULY COVERED BY THE DE CISION OF HONBLE SUPREME COURT IN THE CASE OF SHAMBHU INVESTMENTS (SUPRA).ACCORDI NGLY, THE AO IS DIRECTED TO COMPUTE THE INCOME UNDER THE HEAD INCOME FROM HOUSE PRO PERTY AND ALLOW NECESSARY DEDUCTION U/S.24 OF THE I.T.ACT. 5.IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . RESPECTFULLY,FOLLOWING THE ABOVE ORDER WE DECIDE TH E EFFECTIVE GROUND OF APPEAL IN FAVOUR OF THE ASSESSEE. AS A RESULT,APPEAL FILED BY THE ASSESSEE STANDS ALLOWED. ! . ORDER PRO NOUNCED IN THE OPEN COURT ON 07 MARCH, 2017. 07 , 2017 SD/- SD/- ( / RAM LAL NEGI ) ( '#$ / RAJENDRA ) # %& / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; /DATED : 07.03 .2017. JV.SR.PS. / COPY OF THE ORDER FORWARDED TO : 1. APPELLANT / 2. RESPONDENT / 3. THE CONCERNED CIT(A)/ , 4. THE CONCERNED CIT / 5. DR A BENCH, ITAT, MUMBAI / , , . . . 6. GUARD FILE/ //TRUE COPY// / BY ORDER, / DY./ASST. REGISTRAR , /ITAT, MUMBAI.