ACIT Central Circle 1(4), CHENNAI V. Lalithaa Jewellery Mart Pvt. Ltd., CHENNAI

ITA 3187/CHNY/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 9301 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 6 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-07-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2010-2011
• Appeal Filed On: 26-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M SRINIVASA RAO
• Assessee Lawyers: T BANUSEKAR

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH: CHENNAI , $% & , ) BEFORE SHRI GEORGE MATHAN , JUDICIAL MEMBER AND SHRI VIKRAM SINGH YADAV, ACCOUNTANT MEMBER ./ ITA NOS.3186 TO 3188/CHNY/2017 /ASSESSMENT YEARS: 2009-10 TO 2011-12 THE ASST. COMMISSIONER OF- INCOME TAX, CENTRAL CIRCLE-1(4), CHENNAI-34. VS. M/S.LALITHAA JEWELLERY- MART PVT. LTD., NO.123, USMAN ROAD, T.NAGAR, CHENNAI-600 017. [PAN: AAACL 1523 A ] ( + /APPELLANT) ( ,-+ /RESPONDENT) DEPARTMENT BY : MR.M.SRINIVASA RAO, CIT ASSESSEE BY : MR. T.BANUSEKAR, CA / /DATE OF HEARING : 02.07.2019 / /DATE OF PRONOUNCEMENT : 02.07.2019 / O R D E R PER GEORGE MATHAN, JUDICIAL MEMBER : THESE ARE THREE APPEALS FILED BY THE REVENUE AGAIN ST THE CONSOLIDATED ORDER OF THE COMMISSIONER OF INCOME TA X (APPEALS)-18, CHENNAI, IN ITA NOS.490, 491 & 492/16-17 DATED 27.0 9.2017 FOR THE AYS 2009-10 TO 2011-12 RESPECTIVELY. 2. MR. M.SRINIVASA RAO, CIT, REPRESENTED ON BEHALF OF THE REVENUE AND MR. T.BANUSEKAR, CA, REPRESENTED ON BEHALF OF THE A SSESSEE. ITA NOS.3186-3188/CHNY/2017 :- 2 -: 3. IT WAS SUBMITTED BY THE LD.DR THAT THE ASSESSEE IS A COMPANY WHICH IS DOING THE BUSINESS OF DEALING IN JEWELLERY. IT WAS A SUBMISSION THAT THERE WAS A SEARCH ON THE PREMISES OF THE ASSESSEE ON 02.09.2014. AS A CONSEQUENCE OF SEARCH, NOTICE U/S.153A WAS ISSUED O N 09.01.2015. THE RETURNS OF INCOME WERE FILED BY THE ASSESSEE IN RES PONSE TO THE SAID NOTICE ON 16.06.2015. IT WAS A SUBMISSION THAT THE ASSESS MENTS CAME TO BE COMPLETED U/S.143(3) R.W.S.153A ON 30.12.2016, WHER EIN, SUBSTANTIALLY TWO ADDITIONS HAD BEEN MADE. ONE ON ACCOUNT OF THE DISALLOWANCE BY INVOKING THE PROVISIONS OF SEC.40A(2)(B) OF THE ACT IN RESPECT OF THE LEASE RENT PAID BY THE ASSESSEE COMPANY TO THE MANAGING D IRECTOR OF THE ASSESSEE COMPANY, SHRI M.KIRAN KUMAR, IN RESPECT OF THE PROPERTY AT DOOR NO.122, USMAN ROAD, T.NAGAR, CHENNAI, IN RESPECT OF 4023 SQ.FT. THE SECOND ISSUE WAS DISALLOWANCE MADE BY APPLYING THE PROVISIONS OF SEC.36(1)(III) IN RESPECT OF THE INTEREST ON THE EX CESS LEASE RENTAL ADVANCE PAID BY THE ASSESSEE COMPANY TO SHRI M.KIRAN KUMAR, MD, IN RESPECT OF THE SAID PROPERTY. IT WAS A SUBMISSION THAT ON APP EAL, THE LD.CIT(A) HAD DELETED THE ADDITIONS BY HOLDING THAT NO INCRIMINAT ING MATERIAL WAS FOUND ON ACCOUNT OF THE SEARCH. IT WAS A SUBMISSION THAT THE ORDER OF THE LD.CIT(A) WAS LIABLE TO BE REVERSED AND THAT OF THE AO RESTORED. 4. IN REPLY, THE LD.AR VEHEMENTLY SUPPORTED THE ORD ER OF THE LD.CIT(A). 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. ITA NOS.3186-3188/CHNY/2017 :- 3 -: 6. THE LD.AR DREW OUR ATTENTION TO THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF PRINCIPAL CIT VS. MEETA GUTGUT IA REPORTED IN [2018] 96 TAXMANN.COM 468 (SC), WHEREIN, IT HAS BEEN CATEGORI CALLY HELD THAT THE PROVISIONS OF SEC.153A CANNOT BE INVOKED TO RE-OPEN THE CONCLUDED ASSESSMENTS OF THE ASSESSMENT YEARS EARLIER TO YEAR OF SEARCH IN THE ABSENCE OF INCRIMINATING MATERIAL FOUND DURING THE SEARCH QUA EACH SUCH EARLIER ASSESSMENT YEARS. IT WAS A SUBMISSION THAT THE LD.CIT(A) HAS DELETED THE ADDITION AS NO INCRIMINATING MATERIAL H AD BEEN FOUND IN EACH OF THE SAID ASSESSMENT YEARS. IT WAS A SUBMISSION THAT THE ORDER OF THE LD.CIT(A) WAS LIABLE TO BE UPHELD. A PERUSAL OF TH E ORDER OF THE LD.CIT(A) CLEARLY SHOWS THAT THE LD.CIT(A) HAS FOLLOWED THE D ECISION OF THE HONBLE SPECIAL BENCH OF THE ITAT IN THE CASE OF M/S.ALL CA RGO GLOBAL LOGISTICS LTD., VS. DCIT REPORTED IN [2012] 137 ITD 0287 (SB) , WHEREIN, ALSO IT HAS BEEN HELD THAT WHEN THE ASSESSMENTS ARE COMPLETED A ND NO ASSESSMENT IS PENDING AT THE TIME OF ASSESSMENT U/S.153A, RE-ASSE SSMENT CAN BE MADE ONLY IF INCRIMINATING MATERIAL ARE COLLECTED IN THE COURSE OF SEARCH. A PERUSAL OF THE DECISION OF THE HONBLE SUPREME COUR T IN THE CASE OF PRINCIPAL CIT VS. MEETA GUTGUTIA ALSO LAYS DOWN THE SAME PRINCIPLES. IN THESE CIRCUMSTANCES, RESPECTFULLY FOLLOWING THE PRI NCIPLES LAID DOWN BY THE HONBLE SUPREME COURT IN THE CASE OF PRINCIPAL CIT VS. MEETA GUTGUTIA AS NO INCRIMINATING MATERIAL HAS BEEN FOUND IN THE COU RSE OF SEARCH IN THE CASE OF THE ASSESSEE FOR THE ASSESSMENT YEARS UNDER APPEAL, THE ADDITION AS MADE BY THE AO IS UNSUSTAINABLE. CONSEQUENTLY, THE FINDINGS OF THE LD.CIT(A) ON THIS ISSUE STANDS CONFIRMED. ITA NOS.3186-3188/CHNY/2017 :- 4 -: 7. IN THE RESULT, THE APPEALS FILED BY THE REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 2 ND DAY OF JULY, 2019 IN CHENNAI. SD/- SD/- ( $% & ) ( VIKRAM SINGH YADAV ) /ACCOUNTANT MEMBER ( ) (GEORGE MATHAN) /JUDICIAL MEMBER /CHENNAI, 4 /DATED: 2 ND JULY, 2019. TLN / ,&$ 5$ /COPY TO: 1. + /APPELLANT 4. 6 /CIT 2. ,-+ /RESPONDENT 5. $ , /DR 3. 6 ( ) /CIT(A) 6. /GF