Surinder Kumar Sachdeva, New Delhi V. ACIT, New Delhi

ITA 3287/DEL/2009

• Counselvise Citation: [2010] 119 COUNSELVISE.COM (IT) 5607 (ITAT-DELHI)
• Duration Of Justice: 7 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-03-2010
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Next Hearing Date: 18-03-2010
• Assessment Year: 2005-2006
• Appeal Filed On: 21-07-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: GAJANAND MEENA
• Assessee Lawyers: MOHIT SACHDEVA
• Section: 143(3); 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G : NEW DELHI BEFORE SHRI C.L.SETHI, JM AND SHRI R.C.SHARMA, AM ITA NO.3287/DEL/2009 ASSESSMENT YEAR : 2005-06 SHRI SURINDER KUMAR SACHDEVA, SHOP NO.111-112, INA MARKET, NEW DELHI. PAN NO.ANGPS9914A. VS. ASSTT.COMMISSIONER OF INCOME TAX, CIRCLE-32(1), NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI MOHIT SACHDEVA, ADVOCATE. RESPONDENT BY : SHRI GAJANAND MEENA, CIT-DR. ORDER PER R.C.SHARMA, AM : THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF CIT(A) DATED 22.5.2009 FOR THE AY 2005-06. 2. THE ONLY GRIEVANCE OF THE ASSESSEE RELATES TO LE VY OF INTEREST U/S 234B AND 234C IN RESPECT OF CASH SEIZED BY THE DEPARTMENT AM OUNTING TO RS.4,50,000/- DURING THE COURSE OF SEARCH. 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PER USED. FROM THE RECORD, WE FOUND THAT CASH OF RS.4,50,000/- WAS SEIZED BY T HE DEPARTMENT DURING THE COURSE OF SEARCH AND WHICH WAS CLAIMED BY THE ASSES SEE AS A PAYMENT OF ADVANCE TAX IN THE RETURN FILED FOR THE YEAR 2005-06. HOWE VER, THE AO DID NOT ALLOW CREDIT FOR THE AMOUNT SEIZED AND ACCORDINGLY LEVIED INTERE ST U/S 234B AND 234C AND THE SAME WAS CONFIRMED BY THE CIT(A). LEARNED AR PLACE D ON RECORD THE ORDER OF ITAT DATED 15.1.2010 IN THE CASE OF ASSESSEES FATH ER, WHEREIN SIMILAR SEIZURE OF CASH OF RS.6,50,000/- DURING THE COURSE OF SEARCH W AS DIRECTED TO BE TAKEN INTO ITA-3287/DEL/2009 2 CONSIDERATION WHILE COMPUTING INTEREST U/S 234B FOR THE RELEVANT ASSESSMENT YEAR UNDER CONSIDERATION, AFTER HAVING THE FOLLOWING OBS ERVATION:- THE REQUEST IN THE PRESENT CASE WAS MADE BY THE AS SESSEE IN THE COMPUTATION OF TAXABLE INCOME WHICH WAS FILED W ITH THE RETURN OF INCOME AND HENCE SUCH A REQUEST CAN BE ACCEPTE D ONLY ON THE DATE OF FILING OF THE RETURN OF INCOME I.E. ON 30. 10.2005. ON THIS DATE ALSO, IT HAS TO BE SEEN AS TO WHETHER SEIZED CASH WAS AVAILABLE FOR ADJUSTMENT TOWARDS THE TAX LIAB ILITY OF THE ASSESSEE FOR THE PRESENT YEAR BECAUSE WE FIND T HAT AS PER THE ASSESSMENT ORDER, THERE WAS SURVEY ONLY AND NO SEAR CH. IN THE COMPUTATION OF TAXABLE INCOME ALSO, THE ASSES SEE SAYS THAT CASH AND JEWELRY WERE SURRENDERED ON 4.2.2005 AND IT HA S ALSO BEEN SUBMITTED IN THIS COMPUTATION THAT CASH WAS SEIZED ON 4.2.2005 (RECEIPT ATTACHED). BEFORE US, NO SUCH RECEIPT RE GARDING CASH SEIZURE HAS BEEN FURNISHED. IT IS ALSO INTERESTING T HAT THE AO HAS NOT ALLOWED THE ASSESSEE SUCH ADJUSTMENT OF SEIZED CA SH IN THE INTIMATION ISSUED BY HIM ON 28.7.2006 AND ALSO IN THE ITNS-150 ISSUED ALONG WITH THE ASSESSMENT ORDER PASSED BY H IM U/S 143(3) AND THERE IS NO GROUND RAISED BY THE ASSESSE E BEFORE US OR BEFORE THE CIT(A) REGARDING THE NON-ADJUSTMENT OF SEIZED CASH AGAINST THE TAX LIABILITY FINALLY DETERMINED BY THE AO IN THE INTIMATION OR IN THE ASSESSMENT ORDER U/S 143(3) AN D ONLY CLAIM OF THE ASSESSEE BEFORE US AND BEFORE CIT(A) IS REG ARDING NON- ADJUSTMENT OF SEIZED CASH TOWARDS ADVANCE TAX LIABILITY AND, THEREFORE, WRONG CHARGING OF INTEREST U/S 234B & 2 34C OF THE ACT. UNDER THESE CIRCUMSTANCES, WE FEEL THAT THIS ASPECT OF THE MATTER SHOULD BE EXAMINED BY THE AO AS TO WHETHER ON THE D ATE OF FILING OF RETURN OF INCOME BY THE ASSESSEE ON 30.10.2005, AN Y SEIZED CASH WAS AVAILABLE WITH THE DEPARTMENT FOR ADJUSTMENT A GAINST THE TAX LIABILITY OF THE ASSESSEE FOR THIS ASSESSMENT YEAR AND IF THAT BE SO, THEN ADJUSTMENT SHOULD HAVE BEEN ALLOWED OF THE SEI ZED CASH AGAINST THE TAX LIABILITY OF THE ASSESSEE FOR THIS ASSESSME NT YEAR AND INTEREST SHOULD NOT HAVE BEEN CHARGED U/S 234B FROM THAT DATE ONWARDS I.E. 30.10.2005 ONWARDS. BUT, IF IT I S FOUND THAT THERE WAS NO CASH SEIZED OR THAT THE SEIZED CASH WAS AD JUSTED AGAINST ANY OTHER EXISTING TAX LIABILITY OF THE ASSESSEE, THEN THE ASSESSEE DOES NOT GET ANY RELIEF FROM INTEREST CHARGED BY THE AO U/S 234B OF THE ACT. IN ANY CASE, THE ASSESSEE DOES NOT GET ANY RELIEF F ROM THE INTEREST CHARGED BY THE AO U/S 234C BECAUSE THE REQUEST OF THE ASSESSEE FOR ADJUSTMENT OF SEIZED CASH WAS MADE IN T HE RETURN OF INCOME AND LIABILITY U/S 234C IS FOR DEFERME NT OF TAX UP TO THE END OF THE RELEVANT PREVIOUS YEAR. WITH TH ESE OBSERVATIONS, WE ITA-3287/DEL/2009 3 SET ASIDE THE ORDER OF THE CIT(A) ON THIS ISSUE AND RESTORE THIS MATTER BACK TO THE FILE OF THE AO FOR A F RESH DECISION AS PER ABOVE DISCUSSION AFTER PROVIDING ADEQUATE OPPOR TUNITY OF BEING HEARD TO THE ASSESSEE AND THE ASSESSEE WILL G ET PART RELIEF ON ACCOUNT OF INTEREST U/S 234B FROM THE DATE OF FILING OF INCOME- TAX RETURN BY THE ASSESSEE FROM 30.10.2005 I F THE ASSESSEE CAN ESTABLISH THAT SEIZED CASH WAS AVAILABLE WITH THE DEPARTMENT ON THE DATE OF FILING OF RETURN BY THE ASSESSEE FOR ADJUSTMENT AGAINST THE TAX LIABILITY OF THE ASSESSEE FOR THIS ASSESSMENT YEAR WHICH HAS BEEN ADMITTED BY THE ASSESSEE BY FILING THE RETURN OF INCOME ON 30.10.2005 WITHOUT MAKING ANY PAYME NT AS ADVANCE TAX OR AS SELF-ASSESSMENT TAX. 4. AS THE FACTS AND CIRCUMSTANCES IN THE CASE OF AS SESSEE, WHO IS SON OF SHRI KHARATI LAL SACHDEVA, WHOSE APPEAL WAS DISPOSED BY THE TRIBUNAL VIDE ITS ORDER DATED 15.1.2010, ARE PARI-MATERIA, RESPECTFULLY FOL LOWING THE SAME, WE RESTORE THIS APPEAL TO THE FILE OF THE AO FOR RECOMPUTING THE IN TEREST CHARGEABLE U/S 234B IN TERMS OF DIRECTIONS GIVEN BY THE TRIBUNAL IN THE AF OREMENTIONED ORDER. WE DIRECT ACCORDINGLY. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED IN PART, IN TERMS INDICATED HEREINABOVE. DECISION PRONOUNCED IN THE OPEN COURT ON 18 TH MARCH, 2010. SD/- SD/- (C.L.SETHI) (R.C.SHARMA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 18.03.2010. VK. COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT DEPUTY REGISTRAR ITA-3287/DEL/2009 4