SHAM GANPAT CHOUGULE, MUMBAI V. ASST CIT 6(2)(1), MUMBAI

ITA 3235/MUM/2017

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 3576 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 5 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-10-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2012-2013
• Appeal Filed On: 03-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T S KHALSA
• Keywords: Business expenditure; Opportunity of being heard; Initiation of penalty proceedings; TDS; Set aside; Capital Gains
• Section: 142(1); 274; 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL , G BENCH MUMBAI BEFORE : SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER & SHRI AMARJIT SINGH , JUDICIAL MEMBER ITA NO. 3235 /MUM/ 20 17 ( ASSESSMENT YEAR : 2012 - 13 ) SHRI SHAM GANPAT CHOUGULE 82, INDAGE HOUSE D R. A.B. ROAD, WORLI MUMBAI 400 018 VS. THE ASSTT. COMMISSIONER OF INCOME TAX - 6(2)(1) MUMBAI PAN/GIR NO. ACVPC0933D (APPELLANT ) .. (RESPONDENT ) ASSESSEE BY NONE REVENUE BY SHRI T.S. KHALSA DATE OF HEARING 21 /0 9 /2021 DATE OF PRONOUNCEMENT 06 /10 /202 1 / O R D E R PER AMARJIT SINGH (JM): THE ASSESSEE HAS FILED THIS APPEAL AGAINST THE ORDER DATED 02/01/2017 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) - 12, MUMBAI RELEVANT TO A.Y.2012 - 13. 2. THE ASSESSEE HAS RAISED THE F OLLOWING GROUNDS: - 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) 12 ON FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW ERRED IN COMPLETING THE ASSESSMENT TREATING ASSESSEE AS SALARIED EMPLOYEE. 2. THE LEARNED COMMISSIONER OF INCOME TAX (APPEA LS) 12 ON FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW ERRED IN NOT CONSIDERING THE RECORDS AVAILABLE WITH HIM FURNISHED BY THE APPELLATE IN PROPER PERSPECTIVE. ITA NO . 3235/MUM/2017 SHRI SHAM GANPAT CHOUGULE 2 3. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) 12 ON FACTS AND IN THE CIRCUMSTAN CES OF THE CASE AND IN LAW ERRED IN TREATING A CHAIRMAN OF A GROUP OF COMPANIES AS SALARIED EMPLOYEE AND DISALLOWED THE BUSINESS EXPENDITURE OF RS. 54,80,216/ - . 4. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) 12 ON FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW ERRED IN INITIATING PENALTY PROCEEDINGS U/S. 274 R.W.S 271(L)(C) OF THE ACT, WHEN THE APPELLANT HAS NEITHER WILFULLY CONCEALED PARTICULARS OF INCOME NOR PROVIDED INACCURATE PARTICULARS OF INCOME. 5. THE APPELLANT RESERVES THE RIGHT TO AM END, ALTER, ADD TO AND/OR DELETE ALL OR ANY OF THE ABOVE GROUNDS OF APPEAL. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED ITS RETURN OF INCOME ON 19/11/2013 DECLARING TOTAL INCOME AT RS.5,81,840/ - . THE RETURN WAS PROCESSED U/S.143(1) OF THE ACT. THE CASE WAS SELECTED FOR SCRUTINY AND NOTICE S U/S.143(2) AND 142(1) W ERE ISSUED AND SERVED UPON THE ASSESSEE. THE ASSESSEE IS AN INDIVIDUAL AND HAVING INCOME FROM PROFIT AND GAINS FROM BUSINESS AND PROFESSION, INCOME FROM CAPITAL GAINS AND INCOME FRO M OTHER SOURCES. THE ASSESSEE HAS CLAIMED TOTAL EXPENSES TO THE TUNE OF RS.54,80,210/ - AGAINST THE PROFESSIONAL CHARGES OF RS.6,00,000/ - RECEIVED FROM M/S. INDAGE DEV ELOPMENT CONSTRUCTION PVT. LTD. ASSESSEE FAILED TO SUBMIT THE EXPLANATION WITH REGARD TO E XPENSES OF RS. 54,80,210/ - , THEREFORE, THE EXPENSES WERE DECLINED AND ADDED TO THE INCOME OF THE ASSESSEE. THE TOTAL INCOME WAS ASSESSED TO THE TUNE OF RS.6,00,000/ - . 3.1. FEELING AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A) WHO CONFIRMED THE ADDITION OF AO , THEREFORE, THE ASSESSEE HAS FILED THE PRESENT APPEAL BEFORE US. 3.2. THE ISSUE NOS. 1,2 & 3 ARE IN CONNECTION WITH THE DISALLOWANCE OF EXPENSES IN THE SUM OF RS. 54,80,216/ - . THE ASSESSEE CLAIMED THE EXPENSES TO THE TUNE OF RS. 54,80,210/ - TOWARDS PROFESSIONAL CHARGES AND ITA NO . 3235/MUM/2017 SHRI SHAM GANPAT CHOUGULE 3 RS.6 LAKHS RECEIVED FROM M/S. INDAGE DEV ELOPMENT CONSTRUCTION PVT. LTD. THE REASON FOR DISALLOWANCE OF EXPENSES HAS BEEN MENTIONED TO THE EFFECT THAT THE ASSESSEE CLAIMED SIMILAR TYPE OF PROFESSIONAL CHARGES IN THE EARLIE R YEAR AND THERE IS NO JUSTIFICATION TO ALLOW THE EXPENSES AGAINST THE SAME. HOWEVER, WE NOTICE D THAT THE EXPENSES NOWHERE IN DETAIL DISCUSSED. MOREOVER, THE ASSESSING OFFICER TREATED THE RECEIPT AS SALARY UPON WHICH TDS WAS DEDUCTED U/S.194J AS AGAINST SE CTION 192, THEREFORE, THE ENTIRE EXPENSES OF RS.54,80,210/ - WAS DECLINED. WE NOWHERE FIND IT JUSTIFIABLE. ALL THESE FACTS AND EXPENSES ARE LIABLE TO BE EXAMINED IN DETAIL THEREFORE, WE SET ASIDE FINDING OF THE CIT(A) UPON THIS ISSUE AND RESTORE THE ISSUE B EFORE THE LD. AO TO DECIDE THE MATTER OF CONTROVERSY AFRESH BY GIVING AN OPPORTUNITY OF BEING HEARD TO ASSESSEE IN ACCORDANCE WITH LAW. ACCORDINGLY, THESE ISSUES ARE DECIDED IN FAVOUR OF ASSESSEE AGAINST THE REVENUE. ACCORDINGLY, THE GROUND NOS.1,2 & 3 ARE ALLOWED. 4. THE GROUND NO.4 RAISED BY THE ASSESSEE IS WITH REGARD TO INITIATION OF PENALTY PROCEEDINGS U/S.271(1)(C) OF THE ACT, WHICH WOULD BE PREMATURE FOR ADJUDICATION AT THIS STAGE, HENCE, THE GROUND IS DISMISSED AS PREMATURE. 5. IN THE RESULT, APPE AL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES . ORD ER PRONOUNCED ON 06 / 10 /202 1 BY WAY OF PROPER MENTIONING IN THE NOTICE BOARD. SD/ - ( SHAMIM YAHYA ) SD / - ( AMARJIT SINGH ) JUDICIAL MEMBER JUDICIAL MEMBER MUMBAI ; DATED 06 /10 / 2021 KARUNA , SR.PS ITA NO . 3235/MUM/2017 SHRI SHAM GANPAT CHOUGULE 4 COPY OF THE ORDER FORWARDED TO : BY ORDER, ( ASSTT. REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//