ITO Ward 1(1), Salem V. P.Ramesh, Salem

ITA 376/CHNY/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 4983 (ITAT-CHENNAI)
• Duration Of Justice: 11 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-02-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2009-2010
• Appeal Filed On: 15-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J PAVITRAN KUMAR
• Assessee Lawyers: T VASUDEVAN; S SUDARSHAN
• Keywords: Reopening of assessment; Audit objection; Peak credit; Difference of opinion; Tax effect; Change of opinion

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : CHENNAI, CAMP AT COIMBATORE .. . , !', # '$ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ./I.T.A. NO.376/CHNY/2019 / ASSESSMENT YEAR : 2009-2010. THE INCOME TAX OFFICER, WARD 1(1) SALEM VS. SHRI. P. RAMESH, 100, AMMAPET MAIN ROAD, SALEM. [PAN ADYPR 3290C] ./I.T.A. NO.377/CHNY/2019 / ASSESSMENT YEAR : 2009-2010. THE INCOME TAX OFFICER, WARD 1(1) SALEM. VS. SHRI. P. PALANIAMMAL, 100, AMMAPET MAIN ROAD, SALEM. [PAN AHKPP 1526H] ./I.T.A. NO. 378/CHNY/2019 / ASSESSMENT YEAR : 2009-2010 THE INCOME TAX OFFICER, WARD 1(1) SALEM VS. SHRI. K. RAJENDRAN, NO.297-B, CHINNA KADAI STREET, SALEM -1 [PAN ACFPR 4196P] ( %& / APPELLANT) ( ' (%& /RESPONDENT) ITA NOS.376-378-2019 :- 2 -: / APPELLANT BY : SHRI. J. PAVITRAN KUMAR, JCIT /RESPONDENT BY : SHRI. T. VASUDEVAN & SHRI. S. SUDARSHAN, ADVOCATES /DATE OF HEARING : 07-02-2020 /DATE OF PRONOUNCEMENT : 07-02-2020 / O R D E R PER BENCH:- THESE APPEALS OF THE REVENUE ARE DIRECTED AGAINS T THE RESPECTIVE ORDERS OF THE COMMISSIONER OF INCOME TAX (A), SALEM DATED 15.11.2018 IN RESPECT OF DIFFERENT ASSESSEES AND PE RTAINS TO THE ASSESSMENT YEAR 2009-2010. SINCE COMMON ISSUES ARIS E FOR CONSIDERATION IN ALL THESE APPEALS, WE HEARD THE SA ME TOGETHER AND DISPOSING OFF THE SAME BY THIS COMMON ORDER. 2. SHRI. PAVITHRAN, LD. DEPARTMENTAL REPRESENTATIVE S UBMITTED THAT THE CIT (A) FOUND THAT REOPENING OF THE ASSESSM ENT IS NOT VALID DUE TO CHANGE OF OPINION. ACCORDING TO THE LD. DEPARTM ENTAL REPRESENTATIVE, THE ASSESSING OFFICER HAS RIGHTLY R EOPENED THE ASSESSMENT. EVEN THOUGH THE TAX EFFECT INVOLVED IN THESE APPEALS ARE LESS THAN THE MONETARY LIMIT PRESCRIBED BY THE CENT RAL BOARD OF DIRECT TAXES, DUE TO AUDIT OBJECTIONS, THE APPEALS ARE FILED BEFORE THIS TRIBUNAL. ITA NOS.376-378-2019 :- 3 -: 3. REFERRING TO THE MERIT OF THE APPEALS, THE LD. DEP ARTMENTAL REPRESENTATIVE SUBMITTED THAT THERE WAS LARGE CASH DEPOSITS IN THE BANK ACCOUNT OF THE ASSESSEES. THEREFORE, THE ASS ESSING OFFICER HAD RIGHTLY TAKEN THE PEAK CREDIT FOR ASSESSING THE INC OME. 4. ON THE CONTRARY, SHRI. T. VASUDEVAN, THE LD. REPRES ENTATIVE FOR THE ASSESSEES SUBMITTED THAT ASSESSEES ARE COMMISSION AGENTS DEALING IN GRAPES. THE ASSESSEES EARNED THE INCOM E ONLY THROUGH COMMISSIONS ON SALE OF GRAPES. REFERRING TO THE OR DER OF THE COMMISSIONER OF INCOME TAX (A), THE LD. REPRESENT ATIVE FOR THE ASSESSEES SUBMITTED THAT ASSESSEES HAS FILED ALL T HE MATERIALS IN THE REGULAR ASSESSMENT BEFORE THE ASSESSING OFFICER. T HEREFORE, THE COMMISSIONER OF INCOME TAX (A) RIGHTLY FOUND THAT DUE TO CHANGE OF OPINION, THE ASSESSING OFFICER REOPENED THE ASSESS MENTS. MOREOVER REFERRING TO THE ORDER OF THIS TRIBUNAL IN THE CASE OF SHRI. P. RAMESH IN ITA NO.1189/MDS/2017 , FOR ASSESSMENT YEAR 2009-2010, DATED 27.10.2017, THE LD. REPRESENTATIVE SUBMITTED THAT THIS TRIBUNAL DIRECTED THE ASSESSING OFFICER TO TAKE 4% OF THE TU RNOVER AS COMMISSION AND DELETED THE ADDITION MADE IN THE HA NDS OF ONE OF THE ASSESSEE NAMELY SHRI P. RAMESH (SUPRA). THEREFORE , THERE IS NO JUSTIFICATION IN THE CONTENTION OF THE LD. DEPARTME NTAL REPRESENTATIVE. ITA NOS.376-378-2019 :- 4 -: 5. WE HAVE CONSIDERED THE RIVAL SUBMISSION ON EITHER S IDE AND PERUSED THE MATERIAL ON RECORD. IT IS NOT IN DISPUT E THAT THE ASSESSEES ARE ONLY COMMISSION AGENT. THE DEPARTMENT APAR T FROM THE REOPENING OF ASSESSMENTS HAS ALSO RAISED A GROUND W ITH REGARD TO COMMISSION ON THE BASIS OF THE AGRICULTURAL ECONOM IC SURVEY. INCOME TAX CANNOT BE LEVIED ON THE BASIS OF ECONOMIC SURVE Y, UNLESS AND UNTIL THE DEPARTMENT HAS SPECIFIC MATERIAL WITH REGARD TO EARNING OF INCOME. THE MAIN OBJECTIONS ON MERITS IN THE GROUNDS OF A PPEAL RAISED BY THE REVENUE IS ONLY ON THE BASIS OF ECONOMIC SURVEY . THERE IS NO OTHER MATERIAL AVAILABLE ON RECORD. THIS TRIBUNAL IN THE CASE OF ONE OF THE ASSESSEE SHRI. P. RAMESH, (SUPRA) FOUND THAT AT THE BEST 4% OF THE TOTAL RECEIPT CAN BE TAKEN AS COMMISSION, AC CORDINGLY DELETED THE SIMILAR ADDITION MADE FOR THE VERY SAME ASSES SMENT YEAR IN THE CASE OF RAMESH (SUPRA). MOREOVER IT IS NOT IN DISP UTE THAT ASSESSEES HAVE FILED THE ENTIRE MATERIAL BEFORE THE ASSESSING OFFICER IN THE COURSE OF THE ORIGINAL ASSESSMENT PROCEEDINGS. THE ASSESS ING OFFICER WITHOUT ANY FURTHER MATERIAL HAS REOPENED THE ASSESSMENT BY ISSUING NOTICE U/S.148 OF THE ACT. THEREFORE, AS RIGHTLY FOUND B Y THE CIT(A), IT IS ONLY A CHANGE OF OPINION. IN VIEW OF THE ABOVE, T HIS TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDERS OF TH E COMMISSIONER OF INCOME TAX (APPEALS). ACCORDINGLY, WE CONFIRM THE O RDER OF THE ITA NOS.376-378-2019 :- 5 -: COMMISSIONER OF INCOME TAX (APPEALS) AND DISMISS TH E APPEALS FILED BY THE REVENUE. 6. IN THE RESULT, ALL THE APPEALS FILED BY THE REVENUE IN ITA NOS. 376, 377 & 378/CHNY/2019 FOR ASSESSMENT YEAR 2009-2 010 STAND DISMISSED. ORDER PRONOUNCED IN THE COURT ON 7TH FEBRUARY, 2020 AT CAMP AT COIMBATORE. SD/- SD/- ( ) ( S. JAYARAMAN ) / ACCOUNTANT MEMBER ( ! . . ! . '# ) (N.R.S. GANESAN) $ %& /JUDICIAL MEMBER COIMBATORE. '% / DATED: 7 TH FEBRUARY, 2020. KV %#(( )*(+* / COPY TO: ( 1 . / APPELLANT 3. ( ,(-. / CIT(A) 5. */'( 0 / DR 2. / RESPONDENT 4. ( , / CIT 6. '1(2 / GF