The Income Tax Officer, Ward-3, Panvel V. Shri Arun Tulsidas Sheth, Raigad

ITA 367/PUN/2023

AI Insights

The case involves Arun Tulsidas Sheth, an estate agent who procured lands for Reliance Industries Ltd without formal agreements. A survey in 2010 led to inquiries about substantial expenses under 'Land, Development and Commission'. The assessee surrendered additional income and some unverifiable expenses, leading to a reduced disallowance of Rs.2.28 crore in the original assessment. However, the AO later disallowed the same amount in a re-assessment under section 147. The CIT(A) deleted this addition, finding no non-disclosure of material facts by the assessee, a decision which the Revenue appealed to the Tribunal.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 137718 (ITAT-PUNE)
• Duration Of Justice: 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 30-05-2023
• Assessment Year: 2008-2009
• Appeal Filed On: 29-03-2023
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH, ‘A’ PUNE BEFORE SHRI R.S. SYAL, VICE PRESIDENT AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER आयकर अपील सं. / ITA No.367/PUN/2023 नधा रण वष / Assessment Year : 2008-09 ITO,Ward-3, Panvel Vs. Arun Tulsidas Sheth, 996, Ground Floor, Kaustubh Sea Face, Alibag, Raigad – 402201 Maharashtra PAN : AYJPS1932Q Appellant Respondent आदेश / ORDER PER R.S. SYAL, VP : This appeal by the Revenue is directed against the order dated 27-01-2023 passed by the CIT(A) in National Faceless Appeal Centre (NFAC) u/s.250 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) in relation to the assessment year 2008-09. 2. Succinctly, the facts of the case are that the assessee is engaged in the business as an estate agent. Without entering into any formal agreement, the assessee started procuring lands from farmers on commission basis for Reliance Industries Ltd, Assessee by None Revenue by Shri Ramnath P. Murkunde Date of hearing 31-05-2023 Date of pronouncement 01-06-2023 ITA No.367/PUN/2023 Arun Tulsidas Sheth 2 which started acquiring lands for its SEZ project from Pen Taluka. Survey took place at the premises of the assessee on 10-03-2010. The survey team enquired about expenditure under the head “Land, Development and Commission” amounting to Rs.3,48,89,228/-. The assessee explained that a sum of Rs.1.00 crore was given as commission; and the balance amount was incurred towards owners of land as incentive. Since tax was not deducted at source from commission of Rs.1.00 crore, the assessee surrendered additional income to that extent. Out of the remaining expenses, a further amount of Rs.20.00 lakh was surrendered towards unverifiable expenses. Thus, out of total Rs.3.48 crore, a sum of Rs.2.28 crore was allowed as deduction in the assessment u/s.143(3) of the Act. Thereafter, proceedings u/s.147 were taken by means of notice u/s.148 towards the balance amount of Rs.2.28 crore. In the order passed u/s.143(3) r.w.s.147, the AO made further disallowance of Rs.2.28 crore. The ld. CIT(A) got convinced with the stand point of the assessee and held that there was no failure on the part of the assessee to disclose any material facts necessary for completion of the assessment. He accordingly deleted the addition. Aggrieved thereby, the Revenue has approached the Tribunal. ITA No.367/PUN/2023 Arun Tulsidas Sheth 3 3. We have heard the ld. DR and perused the relevant material on record. There is no appearance from the side of the assessee despite notice. Original assessment in this case was completed u/s.143(3) on 03-12-2010. Notice u/s.148 was issued on 24-03-2015, i.e., after a period of four years from the end of the relevant assessment year. First proviso to section 147 provides that where an assessment has been completed u/s.143(3), no action can be taken u/s.147 after expiry of four years from the end of the relevant assessment year unless an income chargeable to tax escaped the assessment by reason of failure on the part of the assessee, inter alia, to make full and true disclosure of all material facts. The case under consideration involves assessment year 2008-09. Original assessment in this was completed u/s.143(3). Notice u/s.148 was issued on 24-03-2015, which is after a period of four years from the end of the relevant assessment year. It is apparent from the reasons for re-assessment and the resultant addition that the AO wanted to re-verify the expenses of Rs.2.28 crore, which were duly examined in the course of original assessment u/s.143(3) of the Act. In view of the foregoing legal position, tested on the touchstone of the factual matrix of the case, we are ITA No.367/PUN/2023 Arun Tulsidas Sheth 4 satisfied that the decision taken by the ld. CIT(A) does not require any interference. The same is, therefore, upheld. 4. In the result, the appeal is dismissed. Order pronounced in the Open Court on 01 st June, 2023. Sd/- Sd/- (PARTHA SARATHI CHAUDHURY) (R.S.SYAL) JUDICIAL MEMBER VICE PRESIDENT पुणे Pune; िदनांक Dated : 01 st June, 2023 सतीश आदेश की ितिलिप अ ेिषत/Copy of the Order is forwarded to: 1. अपीलाथ / The Appellant; 2. थ / The respondent 3. The Pr.CIT concerned 4. DR, ITAT, ‘A’ Bench, Pune 5. गाड फाईल / Guard file. आदेशानुसार/ BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण ,पुणे / ITAT, Pune ITA No.367/PUN/2023 Arun Tulsidas Sheth 5 Date 1. Draft dictated on 31-05-2023 Sr.PS 2. Draft placed before author 31-05-2023 Sr.PS 3. Draft proposed & placed before the second member JM 4. Draft discussed/approved by Second Member. JM 5. Approved Draft comes to the Sr.PS/PS Sr.PS 6. Kept for pronouncement on Sr.PS 7. Date of uploading order Sr.PS 8. File sent to the Bench Clerk Sr.PS 9. Date on which file goes to the Head Clerk 10. Date on which file goes to the A.R. 11. Date of dispatch of Order. *