Sh. Amarjeet Singh, New Delhi V. CIT, New Delhi

ITA 319/DEL/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 6814 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 9 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-10-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 17-08-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 17-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAVI JAIN
• Keywords: Revision of order
• Section: 143(3); 263

Judgement Text

1 ITA NO. 319/DEL/ 2014 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: A NEW DELHI BEFORE SHRI G. D. AGRAWAL, VICE PRESIDENT AND SMT SUCHITRA KAMBLE , JUDICIAL MEMBER I.T.A .NO.-319/DEL/2014 (ASSESS MENT YEAR 2010-11) AMARJEET SINGH 23, REGAL BUILDING CONNAUGHT PLACE NEW DELHI AAGPS2209D (APPELLANT) VS CIT DELHI-XI NEW DELHI (RESPONDENT) APPELLANT BY SH. K. SAMPATH, ADV RESPONDENT BY SH. RAVI JAIN, CIT DR ORDER PER SUCHITRA KAMBLE, JM THIS APPEAL IS FILED AGAINST THE ORDER DATED 12/12/ 2013 PASSED BY CIT-NEW DELHI U/S 263 OF THE INCOME TAX A CT, 1961. 2. THE GROUNDS OF APPEAL ARE AS FOLLOWS:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW THE ACTION OF THE COMMISSIONER IN INVOLVING THE PROVISIONS OF SECTION 263 OF THE INCOME TAX ACT 196 1 AND IN ANNULLING THE ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER IN THE GROUNDS OF ITS BEING ERRO NEOUS DATE OF HEARING 17.08.2016 DATE OF PRONOUNCEMENT 20.10.2016 2 ITA NO. 319/DEL/ 2014 AND PREJUDICIAL TO THE INTEREST OF THE REVENUE IS A RBITRARY, ERRONEOUS, UNJUST AND ILLEGAL AND MUST BE QUASHED. 3 . DURING THIS YEAR THE ASSESSEE HAS CLAIMED DEDUCTIO N OF RS.2,96,333/- AGAINST INCOME FROM OTHER SOURCES AS INTEREST PAID TO MS. MADHU BHANDARI ON THE LOAN TAKEN FROM HER AMOUN TING TO RS.70 LAKHS. THE ASSESSEE HAS HIMSELF SUBMITTED DU RING THE COURSE OF HEARING THAT THE SAID LOAN WAS UTILIZED FOR GIVI NG ADVANCES TO PARTIES FOR BOOKING OF SPACE AND RETURN OF EARLIER BUSINESS LOAN USED FOR BOOKING OF SPACE. OUT OF THIS LOAN THE AS SESSEE HAD GIVEN ADVANCES FOR BOOKING OF SPACE AMOUNTING TO RS.20 LA CS TO M/S ABV INFRASTRUCTURE LTD RS. 10 LAKHS INVESTED IN M/S S.M . & SONS AS CAPITA; RS. 5 LAKHS PAID TO M/S GLOBAL COMMUNICATIO N FOR SPACE. AND THE REMAINING AMOUNT HAS BEEN USED FOR REPAYMEN T OF LOAN TO BANK. THE ASSESSEE HAS NOT EARNED ANY INTEREST ON THE AMOUNT ADVANCED FOR BOOKING OF SPACE. MOREOVER, IT IS NOT THE BUSINESS OF THE ASSESSEE. SINCE AMOUNT HAS BEEN UTILIZED FOR B OOKING OF SPACE AND THE ASSESSEE HAS ALSO SURPLUS FUNDS WITH HIM WH ICH HE HAD ADVANCED FOR PROPERTIES. THE ASSESSEE HAD ADVANCED AN AMOUNT OF RS.3,71,36,022/-. SINCE THE ASSESSEE HAS NOT EARNE D ANY INTEREST ON THE AMOUNT ADVANCED WHICH IS HIS SURPLUS FUNDS, IT IS NOT THE BUSINESS OF THE ASSESSEE I.E. BOOKING FLAT AND SELL ING THEM ON PROFIT, THE INTEREST OF RS.2,96,333/- ON THE LOAN BORROWED FROM MS. MADHU BHANDARI IS NOT AN ALLOWABLE EXPENSES AND NO DEDUCT ION FOR THE SAME CAN BE ALLOWED AGAINST OTHER INCOME. 4. THE COMMISSIONER OF INCOME TAX UNDER SECTION 263 OF THE INCOME TAX ACT, 1961 HELD THAT THE ASSESSMENT ORDER U/S. 143 (3) 3 ITA NO. 319/DEL/ 2014 OF THE ACT DATED 12.02.2013 WAS ERRONEOUS SO FAR AS IT IS PREJUDICIAL TO THE INTEREST OF REVENUE AND CANCELLED THE SAME A ND DIRECTED THE ASSESSING OFFICER TO FRAME AFRESH. 5. THE LD. AR SUBMITTED THAT THERE WAS NO NEW MATER IAL FOUND BY THE CIT WHILE PASSING THE ORDER UNDER SECTION 263 O F THE ACT. THE PARTICULARS OF ACQUIRED PROPERTY FOR BUILDINGS ALON G WITH DOCUMENTS WERE SUBMITTED AND PLACED BEFORE THE ASSESSING OFFI CER AND THUS ALL THE ASPECTS OF THE ASSESSEE TAKEN INTO ACCOUNT AT THE TIME OF ASSESSMENT PROCEEDINGS. 6. THE LD. DR SUBMITTED THAT THE ORDER UNDER SECTIO N 263 OF THE ACT PASSED BY THE CIT IS JUST AND PROPER. 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE R ELEVANT DOCUMENTS. IT IS PERTINENT TO NOTE THAT THE TOTAL I NCOME OF THE ASSESSEE WAS COMPUTED AS RS.11,16,290/- U/S 288A OF THE ACT. THE ASSESSING OFFICER WHILE PASSING ASSESSMENT ORDER UN DER SECTION 143(3) OF THE ACT HAS TAKEN COGNIZANCE OF THE NECES SARY DOCUMENTS/DETAILS FILED BY THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS. THE ASSESSING OFFICER IN ASSESSMENT OR DER NOTED THAT THE INCOME OF THE ASSESSEE CONSISTS OF SALARY, HOUS E PROPERTY, SHARE OF PROFIT FROM FIRM AND OTHER SOURCES AND VERIFIED THE SAME. THE CIT WHILE PASSING THE ORDER UNDER SECTION 263 OF TH E ACT HAS NOT SHOWN ANY NEW MATERIAL OR HAS NOT COME TO THE CONCL USION THAT THERE IS ESCAPEMENT OF INCOME DURING THE ASSESSMENT PROCEEDINGS. THE PARTICULARS OF ACQUIRED PROPERTY AT REGAL BUILD INGS ALONG WITH DOCUMENTS WERE SUBMITTED AND PLACED BEFORE THE ASSE SSING OFFICER 4 ITA NO. 319/DEL/ 2014 AND THUS ALL THE ASPECTS OF THE INCOME OF THE ASSES EE WAS TAKEN INTO ACCOUNT AT THE TIME OF ASSESSMENT PROCEEDINGS. THE CIT CANNOT TAKE DIFFERENT VIEW ON THE SAME MATERIAL AVAILABLE TO THE ASSESSING OFFICER. THERE IS NO SUCH POWER U/S 263 OF THE ACT TO THE COMMISSIONER OF INCOME TAX. IN RESULT ORDER U/S 26 3 OF THE ACT DOES NOT SURVIVE. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . THE ORDER IS PRONOUNCED IN THE OPEN COURT 20TH OF OCTOBER, 2016. SD/- SD/- (G. D. AGRAWAL) (SUCHITRA KAMBLE) VICE PRESIDENT JUDICIAL M EMBER DATED: 20/10/2016 R. NAHEED * COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT R EGISTRAR ITAT NEW DELHI DATE 1. DRAFT DICTATED ON 17.08.2016 PS 2. DRAFT PLACED BEFORE AUTHOR 18.08.2016 PS 5 ITA NO. 319/DEL/ 2014 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER .2016 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 20.10.2016 PS/PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK 2 0 .10.2016 PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER.