Smt. G. Sridevi, Bangalore V. DCIT, Bangalore

ITA 374/BANG/2014

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 6769 (ITAT-BANGALORE)
• Duration Of Justice: 5 year(s) 1 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-04-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 18-03-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T N PRAKASH
• Assessee Lawyers: ARAVIND V CHAVAN
• Keywords: Salary income
• Section: 143(3); 143(1); 131

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BANGALORE BENCH B BEFORE SHRI A.K GARODIA, ACCOUNTANT MEMBER AND SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA NO.374/BANG/2014 ASSESSMENT YEARS : 2009-10 SMT. G SRIDEVI, #1B, 1 ST FLOOR, NO.15, IST CROSS, PAMPA LAYOUT, KEMPAPURA, HEBBAL, BENGALURU-560 024. PAN BCBPS 2290C. VS. THE DY. COMMISSIONR OF INCOME-TAX, CENTRAL CIRCLE-1(2), BENGALURU. APPELLANT RESPONDENT APPELLANT BY : SHRI ARAVIND V CHAVAN, ADVOCATE RESPONDENT BY : SHRI TN PRAKASH ADDL, CIT DATE OF HEARING : 02.4.2019 DATE OF PRONOUNCEMENT : 22.4.2019 O R D E R PER SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER : THE ASSESSEE HAS FILED APPEAL AGAINST THE ORDER DAT ED 30/12/2013 OF CIT(A)-VI, BENGALURU PASSED U/S 143(3 ) AND 215 OF THE INCOME-TAX ACT, 1961 (THE ACT) AND PERTAINING TO ASST. YEAR 2009-10. 2 ITA NO.374/B/2014 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUND S OF APPEAL: 1. THE LEARNED COMMISSIONER (APPEALS) ERRED IN CONFIRMING THE ORDER OF THE LEARNED AD OF INCOME TA X IN DISALLOWING THE COMMISSION EXPENSES OF RS.10,52,590 /- WAS THE EXPENDITURE INCURRED BY THE APPELLANT FOR AN IKME WHICH HAS BEEN OFFERED U/S.56 OF INCOME TAX ACT. 2. THE APPELLANT SUBMITS THAT DURING THE YEAR UNDER CONSIDERATION, THE APPELLANT HAD EARNED AN INCOME O F RS.26,92,305/- FOR MAKING AVAILABLE OF THE DATAS TO THE INSURANCE COMPANY. THE ABOVE INCOME WAS POSSIBLE ON LY WITH THE HELP OF CERTAIN INDIVIDUAL PERSONS FOR WHO M THE APPELLANT HAS PAID PART OF THE INCOME EARNED FOR EA RNING THE INCOME OFFERED. THEREFORE, THE SAME IS DEDUCTAB LE. 3. THE LEARNED ASSESSING OFFICER ERRED IN CONFIRMI NG THE ADDITIONS OF RS.9,75,000/)-, WHICH WAS DECLARED AS AGRICULTURAL INCOME OF THE APPELLANT. 4. THE APPELLANT FURTHER SUBMITS THAT THE APPELLAN T OWNS SUBSTANTIAL AGRICULTURAL LAND, WHICH HAS BEEN GIVEN TO SUB-TENANTS FOR OPERATION OF AGRICULTURAL INCOME AN D THE INCOME WAS RECEIVED FROM AGRICULTURAL OPERATION HAS BEEN CORRECTLY DISCLOSED UNDER AGRICULTURAL INCOME, WHICH IS TO BE INCLUDED FOR RATE OF TAX PURPOSE ONL Y. 5. THE APPELLANT, WITHOUT PREJUDICE TO THE ABOVE CL AIMS, FURTHER BEGS TO HON'BLE COURT (A) PERMIT TO SUBMIT THAT THE FOLLOWING LEGAL GROUNDS, WHICH HAS NOT BEEN TAKEN UP BEFORE HON'BLE COMMISSIONER OF INCOME TAX AND IS CLAIMED BEFORE HON'BLE BENCH AT THIS STAGE, WHICH MAY BE ADMITTED AND ADJUDICATED UPON THE 3 ITA NO.374/B/2014 LEGAL GROUND. THIS REQUEST TO BE CONSIDERED BASED ON THE HON'BLE APEX COURT'S DECISION IN THE CASE OF NTPC VS CIT, 229 ITR 363. (B) THE ORDER OF THE HON'BLE ASSESSING OFFICER IS LEGALLY NOT TENABLE BECAUSE THE ORDER HAS BEEN PASSED AFTER THE DATE OF SEARCH CARRIED OUT AT THE PREMISES OF THE APPELLANT AND THE APPELLANT SUBMITS THAT AS PER SECOND PROVISO TO SEC.153A(1) THAT, ANY ASSESSMENT RELATING TO ANY ASST. YEAR FALLING WITHIN THE PERIOD OF 6 YEARS PENDING ON THE DATE OF INITIATION OF SEARCH U/S.132 IN ABATE. BASED ON THE ABOVE ORDER PASSED BY THE LEARNED ADDL. COMMISSIONER OF INCOME TAX, REQUIRES TO BE ANNULLED. FOR THE ABOVE AND ANY OTHER GROUNDS THAT MAY BE ADVANCED AT THE TIME OF HEARING, THE APPELLANT PRAYS THAT THE APPEAL BE ALLOWED. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSES SEE HAS INCOME FROM SALARY AND INCOME FROM OTHER SOURCE AND FILED THE RETURN OF INCOME ELECTRONICALLY ON 20/3/2010 WITH TOTAL INCOM E OF RS.3,60,93,180/- AND THE RETURN OF INCOME WAS PROCE SSED U/S 143(1) OF THE ACT. SUBSEQUENTLY, THE CASE WAS SELE CTED FOR SCRUTINY AND NOTICE U/S 143(2) WAS ISSUED. 4. IN THE RETURN OF INCOME, THE ASSESSEE HAS CLAIMED EXPENSES ON COMMISSION TO THE EXTENT OF RS.10,52,590/- UNDER IN COME FROM OTHER SOURCES. THE ASSESSEE HAS NOT MAINTAINED THE BOOKS OF ACCOUNTS AND THE AO HAS ISSUED SUMMONS U/S 131 O F THE ACT 4 ITA NO.374/B/2014 SINCE THERE IS NO PROPER COMPLIANCE AND COOPERATIO N, THE AO HAS DISALLOWED THE CLAIM OF EXPENDITURE FORM THE GROSS COMMISSION INCOME. 5. IN RESPECT OF THE 2 ND ISSUE, THE ASSESSEE HAS DISCLOSED THE AGRICULTURAL INCOME TO THE EXTENT OF RS.9,75,000/- AND SINCE NO DETAILS WERE SUBMITTED AND NO EVIDENCE WAS PRODUC ED. THE AO TREATED THE NON AGRICULTURAL INCOME AS INCOME FROM OTHER SOURCES AND DETERMINED THE TOTAL INCOME OF RS.6,52,16,230 /- AND PASSED ORDER U/S 143(3) DATED 22/2/2011. 6. AGGRIEVED BY THE ORDER OF AO, ASSESSEE FILED APPEAL BEFORE THE CIT(A). THE LD CIT(A) HAVING CONSIDERED THE GROUND OF APPEAL SUBMISSION OF THE ASSESSEE IN RESPECT OF THE COMMIS SION EXPENSES OF RS.10,52,590/- HAS DEALT ON THIS ISSUE AT PARA 9 OF THE ORDER AND ASSEESEES EXPLANATION WERE REFERRED DATED 21/10/20 13. THE CIT(A) IS OF THE OPINION THAT THE ASSESSEE HAS CLAI MED EXPENDITURE AND COULD NOT FURNISH SUPPORTING DETAILS. NO DOUB T ASSESSEE HAS RECEIVED THE COMMISSION FOR PROCUREMENT OF ORDERS FROM BAJAJ ALLIANCE INSURANCE CO. THEREFORE, EXPENDITURE HAS BEEN INCURRED FOR COLLECTION OF DATA BUT NO EVIDENCE/DETAILS WERE PR ODUCED. SINCE THERE IS NO EVIDENCE OR ANY DETAILS FILED BY THE AS SESSEE IN THE APPELLATE PROCEEDINGS, THE CIT(A) HAS CONFIRMED THI S ADDITION OF RS.10,32,590/- AND SIMILARLY THE ASSESSEE HAS DISCL OSED AGRICULTURAL INCOME OF RS.9,75,000/-. IN THE APPELLATE PROCEEDIN GS, THE CIT(A) IS OF THE OPINION THAT THE ASSESSEE COULD NOT SUBST ANTIATE BEFORE THE 5 ITA NO.374/B/2014 LOWER AUTHORITIES AND NO EVIDENCE OF OWNERSHIP OF A GRICULTURAL AND SALE OF AGRICULTURAL PRODUCE FOR EARNING SUCH INCO ME WAS FILED IN APPELLATE PROCEEDINGS HENCE CONFIRMED BOTH THE ADDI TIONS AND GRANTED RELIEF IN RESPECT OF OTHERS ADDITIONS AND P ARTLY ALLOWED THE APPEAL. 7. AGGRIEVED BY THE ORDER OF THE CIT, THE ASSE SSEE HAS FILED AN APPEAL BEFORE THE TRIBUNAL. 8. ON THE FIRST DISPUTED ISSUE OF CLAIM OF COMM ISSION EXPENDITURE OF RS.10,52,590/- THE LD AR SUBMITTED THAT THE ASS ESSEE HAS EARNED COMMISSION INCOME OF RS.26,92,305/- IN RESPECT OF CLAIMING EXPENDITURE ON THE INSURANCE DATA COLLECTIONS, THE LD AR PRAYED TO SUBMIT THE DETAILS AND ALSO FOR AN OPPORTUNITY BEFO RE THE LOWER AUTHORITIES. 9. IN RESPECT OF SECOND ISSUE OF ADDITION OF TR EATMENT OF AGRICULTURAL INCOME RS.9,75,000/- AS NON AGRICULTUR AL, THE LD AR SUBMITTED THAT THE ASSESEE IS OWNING THE AGRICULT URAL LANDS AND AGRICULTURAL ACTIVITIES ARE BEING CARRIED OUT AND REFERRED TO THE PAPER BOOK AT PAGE 36 TO 196 WHERE COPIES OF ORIGINAL SAL E DEEDS ARE IN THE REGIONAL TAMIL LANGUAGE AND TRANSLATED COPIES WERE ALSO FILED AND PRAYED THAT THE SOURCE CANNOT BE DOUBTED AND PR AYED FOR ALLOWING THE ASSESSEES APPEAL. CONTRA THE LD DR SU PPORTED THE ORDER OF THE CIT(A). 6 ITA NO.374/B/2014 10. WE HAVE HEARD THE RIVAL SUBMISSION AND PERU SED THE MATERIAL ON RECORDS AND THE FIRST DISPUTED ISSUE ON CLAIM OF COMMISSION EXPENDITURE OF RS.10,52,590/-. THE LD ARS CONTENT IONS ARE BASED ON THE LETTERS AND FURTHER THE PAYMENTS WERE MADE B Y CHEQUE. THE LD AR COULD NOT FILE ANY DETAILS AND PRAYED FOR OPP ORTUNITY. WE CONSIDER IT APPROPRIATE TO PROVIDE AN OPPORTUNITY A S THE RECEIPT OF COMMISSION INCOME IS NOT DISPUTED AND THE DISCLOSUR E IS MADE BY THE ASSESSEE IN THE RETURN OF INCOME BUT THE CLAI M OF COMMISSION EXPENDITURE OF RS.10,52,590/- IS WITHOUT ANY SUPPOR TING DOCUMENT EXCEPT THE SUBMISSION THAT THEY ARE GENUINE AND TH ROUGH ACCOUNT PAYEE CHEQUES. THEREFORE TO MEET ENDS OF JUSTICE, W E CONSIDER IT APPROPRIATE TO RESTORE THIS ISSUE TO THE FILE OF T HE CIT(A) WHO SHALL CALL FOR REMAND REPORT FROM THE AO AND ASSESSEE SHA LL COOPERATE IN FILING THE DETAILS FOR THE DISPOSAL OF THE APPEAL. 11. IN RESPECT OF THE SECOND DISPUTED ISSUE OF TR EATMENT OF AGRICULTURAL INCOME OF RS.9,75,000, WE FIND LD ARS SUBSTANTIVED THE STAND WITH THE COPIES OF THE SALE DEED AND TRAN SLATED COPIES IN THE PAPER BOOK AND WHICH THE LD DR HAS NOT DISPUTED . BUT THE CONTENTION OF THE LD DR THAT THE DOCUMENTS WERE FIL ED FIRST TIME BEFORE THE TRIBUNAL AND THE LOWER AUTHORITIES NEVER HAD OCCASION TO VERIFY AND EXAMINE THE SAME. THEREFORE WE ARE OF T HE OPINION THAT SINCE THEY ARE FILED FIRST TIME BEFORE THE TRIBUNA L AND WERE ALSO CONSIDERED IN THE ASSESSMENT OF THE ASSESSEE IN SUB SEQUENT YEARS. ACCORDINGLY, WE CONSIDER IT APPROPRIATE TO RESTORE THIS DISPUTE ISSUE TO THE FILE OF THE CIT(A) ALONG WITH EVIDENCES FILE D. THE ASSESSEE 7 ITA NO.374/B/2014 SHALL COOPERATE IN SUBMITTING INFORMATION EXPEDITI OUSLY AND THE CIT(A) SHALL PASS A REASONED AND SPEAKING ORDER ON MERITS. ACCORDINGLY, WE RESTORE THE DISPUTED ISSUES TO THE FILE OF CIT(A) AND ALLOW THE GROUNDS OF APPEAL OF THE ASSESEE FOR STATISTICAL PURPOSES. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED FOR ST ATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 22 ND APRIL, 2019 . SD/- SD/- (A.K GARODIA) (PAVAN KUMAR GADALE) ACCOUNTANT MEMBER JUDICIAL MEMBER BANGALORE DATED : 22/4/2019 VMS COPY TO :1. THE ASSESSEE 2. THE REVENUE 3.THE CIT CONCERNED. 4.THE CIT(A) CONCERNED 5.DR 6.GF BY ORDER ASST. REGISTRAR, I TAT, BANGALORE. 8 ITA NO.374/B/2014 1. DATE OF DICTATION 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER . 3. DATE ON WHICH THE APPROVED DRAFT COMES TO SR.P.S .. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER .. 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE S R. P.S. .. 6. DATE OF UPLOADING THE ORDER ON WEBSITE .. 7. IF NOT UPLOADED, FURNISH THE REASON FOR DOING SO .. 8. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK .. 9. DATE ON WHICH ORDER GOES FOR XEROX & ENDORSEMENT 10. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 11. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER . 12. THE DATE ON WHICH THE FILE GOES TO DISPATCH SEC TION FOR DISPATCH OF THE TRIBUNAL ORDER . 13. DATE OF DESPATCH OF ORDER. ..