Suryanarayana Vangapalli, Hyderabad V. THE DYCIT, Visakhapatnam

ITA 344/VIZ/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 8690 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 9 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-03-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2006-2007
• Appeal Filed On: 09-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T SATYANANDAM
• Assessee Lawyers: SAMUEL NAGADESHI
• Keywords: Search and seizure
• Section: 143(3); 133A; 148; 132

Judgement Text

ITA NO.344 TO 348/VIZAG/2017 SURYANARAYANA VANGAPALLI& GODDI KANNA RAO, VSKP 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . .. . . . . . ' , % BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER ./I.T.A.NOS.344 TO 346/VIZAG/2017 ( / ASSESSMENT YEARS: 2006-07, 2007-08 & 2008-09) SURYANARAYANA V E NGAPALLI VISAKHAPATNAM DCIT, CENTRAL CIRCLE - 1 VISAKHAPATNAM [PAN NO. ACDPV6279P ] ( ' / APPELLANT) ( ()' / RESPONDENT) ./I.T.A.NOS.347 & 348/VIZAG/2017 ( / ASSESSMENT YEARS: 2008-09 & 2009-10) GODDI K ANNA RAO, VISAKHAPATNAM DCIT, CENTRAL CIRCLE - 1 VISAKHAPA TNAM [PAN NO.AELPG1198N] ( ' / APPELLANT) ( ()' / RESPONDENT) / APPELLANT BY : SHRI SAMUEL NAGADESHI, AR / RESPONDENT BY : SHRI T. SATYANANDAM, DR / DATE OF HEARING : 09.03.2018 / DATE OF PRONOUNCEMENT : 1 4.03.2018 ITA NO.344 TO 348/VIZAG/2017 SURYANARAYANA VANGAPALLI& GODDI KANNA RAO, VSKP 2 / O R D E R PER BENCH: THESE APPEALS FILED BY DIFFERENT ASSESSEES ARE DIR ECTED AGAINST ORDERS OF THE COMMISSIONER OF INCOME TAX (A PPEALS)-3 {CIT(A)}, VISAKHAPATNAM VIDE NOS.127, 128, 129, 133 & 134/2015- 16/CIT(A)-3/VSP/2017-18 DATED 19.4.2017 FOR THE ASS ESSMENT YEARS 2006-07 TO 2009-10. SINCE, THE FACTS ARE IDENTICAL AND ISSUES ARE COMMON, THEY ARE CLUBBED, HEARD TOGETHER AND DISPOS ED-OFF BY WAY OF THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. A SEARCH AND SEIZURE OPERATION WAS CONDUCTED U/S 132 OF THE ACT IN THE CASE OF SRI N.S.N. REDDY AND IN THE PREMISES OF SAI LAKSHMI TOWNSHIP PRIVATE LIMITED AND A SURVEY OPERATION U/S 133A OF THE ACT IN ITS BRANCH OFFICE ON 22.8.2008. A SURVEY U/S 133A OF THE ACT WAS CONDUCTED IN THE CASE OF THE ASSESSEE ALSO. DURING THE COURSE OF SEARCH AND SURVEY, IT WAS FOUND THAT THE ASSESSEE IS WORKI NG AS PROJECT DIRECTOR IN M/S. SAI LAKSHMI TOWNSHIP PRIVATE LIMITED AND AC TIVELY ENGAGED IN SELLING PLOTS OF THE COMPANY AS WELL AS OF OTHER CO NCERNS. NOTICE U/S 148 OF THE ACT WAS ISSUED TO THE ASSESSEE AND THE A SSESSMENTS WERE COMPLETED U/S 143(3) R.W.S. 147 OF THE ACT. ITA NO.344 TO 348/VIZAG/2017 SURYANARAYANA VANGAPALLI& GODDI KANNA RAO, VSKP 3 AGGRIEVED BY THE ORDER OF THE A.O., THE ASSESSEE WE NT ON APPEAL BEFORE THE CIT(A) AND RAISED THE FOLLOWING GROUNDS OF APPE AL: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE T HE ORDER OF THE LEARNED DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-1, VISAKHAPATNAM IS ERRONEOUS IN LAW AND FACTS OF THE CASE. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE T HE LEARNED ASSESSING OFFICER ERRED IN LAW AND FACTS IN MAKING AN ADDITIO N OF RS.7,20,000/- AS INVESTMENT OUT OF UNDISCLOSED COMMISSION IGNORING T HE EXPLANATION OFFERED BY THE APPELLANT ABOUT THE SOURCES. ON THE FACTS A ND IN THE CIRCUMSTANCES OF THE CASE THE LEARNED ASSESSING OFFICER OUGHT TO HAVE ACCEPTED THE RETURNED INCOME AS THE SAME CONSTITUTES A TRUE AND FULL DISCLOSURE OF THE INCOME EARNED BY THE APPELLANT BY WAY OF COMMISSION AS SUCH WOULD NOT HAVE RECOURSE TO THE STATEMENT UNDER SECTION 132(4) WHICH WAS RETRACTED AND THE SOURCES WERE EXPLAINED. 3. THE APPELLANT CRAVE LEAVE TO ADD TO, DELETE, ALTER, AMEND, SUBSTITUTE OR MODIFY ALL OR ANY OF THE ABOVE GROUNDS. 3. LD. CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE, HENCE, ASSESSEE IS IN APPEAL BEFORE US CHALLENGING THE ORDER OF THE CIT(A) ON THE FOLLOWING GROUNDS: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE ORDER OF THE LEARNED CIT(A) TO THE EXTENT CONFIRMING THE ORDER O F THE A.O. UNDER SECTION 143(3) READ WITH SECTION 147 OF THE INCOME-TAX ACT, 1961 IS ERRONEOUS IN LAW AND FACTS OF THE CASE. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LEARNED CIT(A) IS ERRED IN LAW AND FACTS OF THE CASE IN CONFIRMING THE IMPUGNED ORDER PASSED BY THE A.O. CONSEQUENT TO THE ACTION U/S 132 AS THE A.O. O UGHT TO HAVE APPLIED THE APPLICABLE PROVISIONS OF SECTION 153C AND NOT THE P ROVISIONS OF SECTION 147 OF THE ACT. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE THE LEARNED CIT(A) ERRED IN LAW AND FACTS OF THE CASE IN CONFIRMING TH E ADDITION OF ` 7,20,000/- WITHOUT ANY COGENT EVIDENCE IGNORING THE OTHER FACTS OF THE CIRCUMSTANCES. 4. THE APPELLANT CRAVE LEAVE TO ADD TO/ALTER/SUBS TITUTE/DELETE/MODIFY ALL OR ANY OF THE ABOVE GROUNDS. ITA NO.344 TO 348/VIZAG/2017 SURYANARAYANA VANGAPALLI& GODDI KANNA RAO, VSKP 4 4. GROUND NOS.1 & 2 RAISED BEFORE THE TRIBUNAL ARE RELATED TO THE VALIDITY OF THE ASSESSMENT MADE U/S 143(3) R.W.S. 1 47 OF THE ACT AND GROUND NO.2 IS RELATED TO THE COMPLETION OF ASSESSM ENT UNDER SECTION 153C OF THE ACT INSTEAD OF SECTION 147 OF THE ACT. BOTH THE GROUNDS OF APPEAL ARE TECHNICAL IN NATURE BUT NOT RAISED BEFOR E THE LD. CIT(A). THE LD. A.R. ARGUED THAT THE ASSESSMENT MADE U/S 147 OF THE ACT IS ILLEGAL AND BAD IN LAW AND THE A.O. SHOULD HAVE MADE THE AS SESSMENT U/S 153C OF THE ACT, SINCE THERE WAS A SEARCH ACTION U/S 132 OF THE ACT IN THE CASE OF M/S. SAI LAKSHMI TOWNSHIP PVT. LTD. AND FOUND TH E INCRIMINATING MATERIAL ON THE BASIS OF WHICH THE ASSESSMENTS WERE REOPENED. THEREFORE, ARGUED THAT THE GROUND SHOULD BE ADMITTE D AND BE ADJUDICATED. 5. ON THE OTHER HAND, THE LD. D.R. VEHEMENTLY OPPOS ED THE ADMISSION OF ABOVE GROUNDS, WHICH WAS NOT RAISED BE FORE THE CIT(A). THE LD. D.R. FURTHER ARGUED THAT IN CASE THE GROUND S ARE ARE ADMITTED, AN OPPORTUNITY SHOULD BE GIVEN TO REVENUE TO ADJUDI CATE THE GROUNDS BY THE LD. CIT(A). 6. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATER IALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHOR ITIES BELOW. THE ASSESSEES CASE IS THAT A SEARCH AND SEIZURE OPERAT ION WAS CONDUCTED U/S 132 OF THE ACT IN THE CASE OF SAI LAKSHMI TOWNS HIP PVT. LTD., AND ITA NO.344 TO 348/VIZAG/2017 SURYANARAYANA VANGAPALLI& GODDI KANNA RAO, VSKP 5 THE INCRIMINATING MATERIAL WAS FOUND ON THE BASIS O F WHICH REASSEMENT PROCEEDINGS U/S 147 ARE INITIATED IN THE ASSESSEES CASE OTHERWISE THERE IS NO CASE FOR REASSESSMENT. AS PER THE PROVISIONS OF SECTION 153C OF THE ACT THE ASSESSMENT SHOULD HAVE MADE U/S 153C R.W.S. 143(3) OF THE ACT BUT NOT UNDER SECTION 147 OF THE ACT, HENCE ARGUED THAT THE GROUNDS RAISED BY THE ASSESSEE IN GROUND NOS.1 & 2 GOES TO THE ROOT OF THE ASSESSMENT. HOWEVER, THE ASSESSEE DID NOT RAISE TH E ABOVE TWO GROUNDS BEFORE THE LD.CIT(A). THEREFORE, IN THE IN TEREST OF JUSTICE, WE ARE OF THE CONSIDERED OPINION THAT THE ISSUE SHOULD BE REMITTED BACK TO THE FILE OF THE LD.CIT(A) WHO WILL ADJUDICATE THE A BOVE GROUNDS AND DECIDE THE ISSUE AFRESH ON MERITS. ACCORDINGLY, WE REMIT THE APPEALS BACK TO THE FILE OF THE CIT(A) TO DECIDE THE ISSUE AFRESH ON MERITS. 7. IN THE RESULT, THE APPEALS FILED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT O N 14 TH MAR18. SD/- SD/- ( . ) ( . .. . . . . . ' ) (V. DURGA RAO) (D.S. SUNDER SINGH) /JUDICIAL MEMBER /ACCOUNTANT MEMBER # /VISAKHAPATNAM: ' /DATED : 14.03.2018 VG/SPS ITA NO.344 TO 348/VIZAG/2017 SURYANARAYANA VANGAPALLI& GODDI KANNA RAO, VSKP 6 )# *# /COPY OF THE ORDER FORWARDED TO:- 1. / THE APPELLANT SRI SAMUEL NAGADESI, CHARTERED A CCOUNTANT, 408, SRI RAMAKRISHNA TOWERS, BESIDES IMAGE HOSPITALS, AMEERPE T, HYDERABAD-500 073. 2. / THE RESPONDENT THE DCIT, CENTRAL CIRCLE-1, VIS AKHAPATNAM 3. + / THE PR. CIT (CENTRAL), VISAKHAPATNAM 4. + ( ) / THE CIT (A)-3, VISAKHAPATNAM 5. # . , . , # / DR, ITAT, VISAKHAPATNAM 6 . / GUARD FILE / BY ORDER // TRUE COPY // SR. PRIVATE SECRETARY ITAT, VISAKHAPATNAM