GANESAN KALEESWARAN, CHENNAI V. ITO, NCW - 23 (4), CHENNAI

ITA 3404/CHNY/2019

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 7182 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 5 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-06-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: C
• Assessment Year: 2016-2017
• Appeal Filed On: 19-12-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Salary income; Revised return

Judgement Text

आयकर अपीलीय अिधकरण, ‘सी’ ᭠यायपीठ, चे᳖ई IN THE INCOME TAX APPELLATE TRIBUNAL ‘C’ BENCH, CHENNAI Įी महावीर ͧसंह, उपाÚय¢ एवं Įी मनोज क ु मार अĒवाल, लेखा सदèय के सम¢ BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENTAND SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.: 3404/CHNY/2019 िनधाᭅरण वषᭅ /Assessment Year:2016-17 Shri Ganesan Kaleeswaran, 1A, Sadagopan Enclave, Kannappan St, Chrompet Rd, Nanmangalam, Chennai – 600 117. PAN: AHSPG 6216B v. The Income Tax Officer, Non-Corporate Ward-23(4), Chennai (अपीलाथᱮ/Appellant) (ᮧ᭜यथᱮ/Respondent) अपीलाथᱮ कᳱ ओर से/Appellant by : None ᮧ᭜यथᱮ कᳱ ओर से/Respondent by : Shri P. Sajit Kumar, JCIT स ु नवाई कȧ तारȣख/Date of Hearing : 06.06.2022 घोषणा कȧ तारȣख/Date of Pronouncement : 15.06.2022 आदेश /O R D E R PER MAHAVIR SINGH, VP: This appeal by the assessee is arising out of the order of Commissioner of Income Tax (Appeals)-10, Chennai in ITA No.138/CIT(A)-10/18-19, order dated 22.10.2019. The assessment was framed by the ITO, Non-Corporate Circle 23(4), Chennai for the 2 ITA No.3404/Chny/2019 assessment year 2016-17 u/s.143(3) of the Income Tax Act, 1961 (hereinafter the ‘Act’) vide order dated 25.12.2018. 2. At the outset, it is noticed that this appeal was fixed for hearing on many occasions numbering 14 and almost it went unrepresented and only on one hearing i.e., on 05.04.2022, one Ms. K. Bhuvaneswari, Advocate appeared and asked for adjournment. Now, none is present. Hence, we decided to take this appeal ex-parte qua assessee and decide the appeal on merits. 3. It is noticed from grounds raised in Form No.36, column 10 that following are the grounds:- “1. Reworked by the assessing officer on the basis of assumptions not by fact 2. Bank statements submitted not considered. 3. Oral and documentary evidence was not taken into account. Just brushed up by stating that vague reply and sister (Anjana Devi-Co owner of the house) has not received any email or letter from the A.O’ From the above grounds, it is not clear what is the issue but while perusing the order of CIT(A), it is noticed that the following two grounds were before CIT(A):- 1) Income from House Property u/s.24 of the I.T. Act, reworked by the Assessing Officer on the basis of assumptions and not the evidences provided. 3 ITA No.3404/Chny/2019 2) Excess expenses claimed u/s.10 of the I.T. Act, Bank statements submitted was not considered. Oral and documentary evidences regarding also was not taken into account. 4. First, we will deal with the issue of expenses claimed as deduction u/s.10 of the Act. 5. Brief facts are that the assessee is an employee of AON Services India Pvt. Ltd., and disclosed salary income in the return of income. The assessee’s case was selected for scrutiny to verify the following (i) taxable income shown in revised return is less than the taxable income shown in the original return and large refund has been claimed (ii) Salary income shown in ITR is less than the salary income as per 26AS. The AO required the assessee to explain how the salary income in the revised return of income is less than the original return of income. The assessee explained that he has claimed LTA of Rs.2,56,410/-, food expenses of Rs.36,000/-, medical expenses of Rs.30,000/-, telephone expenses of Rs.60,000/-, conveyance expenses of Rs.19,200/- and other exemptions of Rs.1,85,262/-. The assessee explained that the total deduction claimed on the above items comes to Rs.5,86,872/-. The AO observed that the assessee has not reported the gross salary to the extent of Rs.5,86,872/- and accordingly, the same was added to 4 ITA No.3404/Chny/2019 the returned income of the assessee. Aggrieved assessee preferred appeal before CIT(A). 6. The CIT(A) noted that the gross salary as per Form No.26AS & Form No.16 is Rs.20,57,709/- whereas as per revised return, he has disclosed salary income at Rs.14,70,837/-. The CIT(A) noted that the assessee is entitled to claim deduction u/s.10 of the Act, on medical expenses of Rs.30,000/- but the other claim of various expenses like LTA of Rs.2,56,410/-, food expenses of Rs.36,000/-, telephone expenses of Rs.60,000/-, conveyance expenses of Rs.19,200/- and other exemptions of Rs.1,85,262/- does not come within the provisions of section 10 of the Act and thereby he disallowed the claim of assessee. The CIT(A) finally held that the AO has rightly recomputed the salary by making addition of Rs.5,86,872/- as under reported by claiming expenses of personal nature. Accordingly he confirmed the addition. 7. After hearing ld. Senior DR and going through the facts of the case, we noted that the facts are not clearly emerging out of the order of the AO or the CIT(A) whether the assessee is eligible to claim LTA and if any LTA is added to the gross salary of the assessee or not. This issue needs reconsideration and hence, only 5 ITA No.3404/Chny/2019 the issue of LTA is sent back to the file of the AO for reconsideration i.e., for an amount of Rs.2,56,410/-. As regards to food expenses of Rs.36,000/-, telephone expenses of Rs.60,000/-, conveyance expenses of Rs.19,200/- and other exemptions of Rs.1,85,262/-, it is hereby confirmed because these are not related to earning of salary or due to employment urgencies as is envisaged u/s.10(14)(i) & (ii) of the Act. Accordingly, this issue is partly set aside to the file of the AO. 8. The next issue is as regards to the claim of income from house property u/s.24 of the Act. The facts are that the assessee has two house properties i.e., house property No.2/33 Avia Enclave, Balakrishnan Street, Nanmangalam, Chennai – 117 as his own property and another joint property with his sister i.e., 1A, Sadagopan Enclave, Kannappan Street, Nanmangalam, Chennai – 117. The assessee has made claim on total interest paid for financial year 2015-16 relevant to this assessment year 2016-17 amounting to Rs.5,37,586/- as the assessee has disclosed rental income of Rs.30,000/- and claimed the entire interest. The AO allowed interest to the extent of Rs.2,00,000/- out of the interest claimed by assessee of Rs.5,23,579/- and balance was disallowed 6 ITA No.3404/Chny/2019 and added under the head ‘income from house property’ at Rs.3,23,579/-. Aggrieved, assessee preferred appeal before CIT(A). 9. The CIT(A) noted that the assessee is entitled for claim of deduction to the extent of maximum deduction of Rs.2,00,000/- for self-occupied house property as the assessee claimed the first property as his house property and the second property jointly owned with sister on which the interest on borrowed capital claimed by assessee is Rs.5,37,586/- for which the assessee has earned rental income of Rs.30,000/-. The CIT(A) after allowing the maximum deduction of Rs.2,00,000/- as allowed by AO, confirmed the addition of Rs.3,23,579/- made by AO. According to CIT(A), the assessee has claimed this loss just to reduce the salary income. Aggrieved assessee came in appeal before the Tribunal. 10. After hearing ld. Senior DR and going through the facts on record, we noticed that the assessee has claimed house property loss of Rs.5,23,579/- out of which the AO himself has allowed the loss claimed on account of interest paid of Rs.2,00,000/- under the head ‘income from house property’ and balance amount of Rs.3,23,579/- was added. We find no infirmity in the orders of 7 ITA No.3404/Chny/2019 lower authorities and hence, this issue of assessee’s appeal is dismissed. 11. In the result, the appeal filed by the assessee is partly allowed for statistical purpose. Order pronounced in the open court on 15th June, 2022 at Chennai. Sd/- Sd/- (मनोज कुमार अᮕवाल) (MANOJ KUMAR AGGARWAL) लेखा सद᭭य /ACCOUNTANT MEMBER (महावीर ᳲसह ) (MAHAVIR SINGH) उपा᭟यᭃ /VICE PRESIDENT चे᳖ई/Chennai, ᳰदनांक/Dated, the 15 th June, 2022 RSR आदेश कᳱ ᮧितिलिप अᮕेिषत/Copy to: 1. अपीलाथᱮ/Appellant 2. ᮧ᭜यथᱮ/Respondent 3. आयकर आयुᲦ (अपील)/CIT(A) 4. आयकर आयुᲦ /CIT 5. िवभागीय ᮧितिनिध/DR 6. गाडᭅ फाईल/GF.