Kalpana Dixit, V. ACIT CC-12,

ITA 388/DEL/2008

• Counselvise Citation: [2009] 114 COUNSELVISE.COM (IT) 8130 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 4 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-06-2009
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 29-06-2009
• Assessment Year: 1999-2000
• Appeal Filed On: 07-02-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: A K SHARMA
• Keywords: Set aside
• Section: 153A; 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH `D: NEW DELHI BEFORE SHRI R.P. TOLANI, JM AND SHRI A.K. GORAD IA, AM I.T.A. NOS.387 TO 393/DEL OF 2008 ASSESSMENT YEARS: 2004-05 MRS. KALPANA DIXIT, ACIT, CENTRAL CIRCLE- 12, 1/1, SHANTI NIKETAN, NEW DELHI VS NEW DE LHI. APPELLANT RESPONDENT APPELLANT BY: SHRI A.K. SHARMA RESPONDENT BY: SMT. KAVITA BHATNAGAR ORDER PER R.P. TOLANI, JM: THIS IS A BATCH OF SEVEN APPEALS BY THE ASSESSEE A GAINST THE ASSESSMENTS MADE U/S 153A CONSEQUENT TO SEARCH OPER ATIONS. GROUNDS RAISED ARE AS UNDER: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE ORDERS PASSED BY LOWER AUTHORITIES ARE ARBITRARY, UNJUSTIFIED AND BAD IN LAW. 2. FOLLOWING ADDITIONS ARE CONTESTED ON MERITS AS RETAINED BY CIT(A): ASSTT. YEAR HOUSEHOLD EXPENSES FOREIGN TRAVEL 1998-99 10,000/- - 1999-2000 10,000/- - 2000-01 15,000/- 6,00,000 2001-02 30,000/- 3,00,000 2 2002-03 30,000/- - 2003-04 40,000/- 8,00,000/- 2004-05 35,000/- - 2. LEARNED COUNSEL FOR THE ASSESSEE VEHEMENTLY ARGU ES THAT THE ASSESSEE IS BEING TREATED IN AN ARBITRARY MANNER INASMUCH AS NO JUSTIFICATIONS ARE BEING GIVEN ABOUT THE EXPENSES. IT WAS CONTENDED T HAT HER HUSBAND MR. VIJAY DIXIT IS IN THE CONSTRUCTION LINE HAVING A GR OUP OF COMPANIES KNOWN AS SUSHANT BUILDERS GROUP. ASSESSEE LADY PRIOR TO HER MARRIAGE WAS AN EMPLOYEE OF STATE BANK OF BIKANER. SHE WAS DRAWING ONLY A SALARY OF RS.75,000/- FROM SUSHANT BUILDERS P. LTD. A SEARCH ACTION WAS CARRIED OUT ON THE SAID GROUP OF COMPANIES, ASSESSEES HUSBAND AND ASSESSEE. BY NOW VARIOUS PROCEEDINGS ARE UNDER LITIGATION REVOLVING AROUND MAMMOTH ADDITIONS OF AROUND RS.500 CRORES IN THE CASE OF TH E HUSBAND OF THE ASSESSEE. ATTENTION WAS DRAWN TO FOLLOWING PARAS OF CIT(A) TO HIGHLIGHT NON SPEAKING NATURE OF AOS ORDER AND FURTHER NON SPEAKING NATUR E OF CIT(A)S ORDER: 3. THE ASSESSING OFFICER HAS MADE ADDITION OF RS.1,20,000/- ON ACCOUNT OF HOUSEHOLD EXPENSES. IT WAS ARGUED THAT ENTIRE HOUSEHOLD EXPENSES WERE MADE BY THE HUSBAND OF THE ASSESSEE SHRI VIJAY DIXIT. SINCE THE ASSESSEE HAS INDIVIDUAL SOURCE OF INCOME SO CERTAIN AMOUNT OF PERSONAL EXPENDITURE MADE OUT OF PERSONAL INCOME CANNOT BE RULED OUT, HENCE ADDITION OF RS.1,20,000/- IS REDUCED TO RS.40,000/-. RELIEF OF RS.8,000/-. 3 4. THE ASSESSING OFFICER HAS ADDED RS.13,00,000/- ON ACCOUNT OF FOREIGN VISITS BY THE ASSESSEE ALONG WITH HER HUSBAND AND TWO CHILDREN. THE ASSESSEE TOOK THE FOREIGN VISITS FROM 27.5.2003 TO 21.6.2002. THIS FACT WAS VERIFIED BY THE AO FROM THE REGIONAL PASSPORT OFFICE IN ALL DURING THE YEAR 2000-01, 2001-02 AND 2003-04 THE ASSESSEE VISITED FOUR TIMES ALONG WITH FAMILY TO DIFFERENT COUNTRIES LIKE USA, U.K. THE DURATION OF STAY WAS FROM A WEEK TO FOUR WEEKS IN THESE COUNTRIES. IT WAS ARGUED THAT HER EXPENSES OF THESE VISITS AMOUNTING TO RS.36,00,000/- HAVE BEEN MET BY SHRI VIJAY DIXIT, THE HUSBAND OF THE ASSESSEE. AN AFFIDAVIT HAS FILED BEFORE ME FROM SHRI VIJAY DIXIT REGARDING SUCH CLAIM. IT HAS ALSO BEEN STATED IN T HE AFFIDAVIT THAT SUCH AN AFFIDAVIT BEARING FOREIGN VI SIT EXPENSES HAD BEEN FILED BEFORE THE AO ALSO BUT COPY OF WHICH COULD NOT BE FILED BEFORE ME BECAUSE IT IS NOT READILY TRACEABLE. THE AO MADE DIFFERENT ADDITIONS IN THE THREE ASSESSMENT YEARS I N THE HANDS OF THE ASSESSEE NOT FINDING RS.36,00,000/- TO BE ADEQUATE FOR MEETING EXPENSES OF FOREIGN VISITS. IT WAS ARGUED THAT ALL THE VISITS ARE DULY RECORDED IN THE PASSPORT AND TH E FOREIGN CURRENCY WAS OFFICIALLY PURCHASED. 5. I HAVE CONSIDERED THE FACTS AND CIRCUMSTANCES OF THE CASE, THE REASONING OF THE AO AND THE SUBMISSIONS OF THE ASSESSEE. THE AVERAGE EXPENSES PER VISIT ISRS.9 LAKHS WHICH INCLUDES TO AND FRO TICKETS OF FOUR PERSONS AND FURTHER EXPENSE S OF BOARDING AND LODGING AND ALSO PERSONAL EXPENSES AT THE COUNTRIES LIKE USA AND UK. THE AMOUNT CANNOT BE ASSUMED TO BE ADEQUATE IN TERMS OF THE VALUE IN INDIAN CURRENCY. BUT AO HAS ALSO NOT JUSTIFIED THE ADDITION OF RS.13,00,000/-. HE SIMPLY STATED THAT ASSESSEE COULD NOT PROVE THAT AL L THE EXPENSES WERE BORNE OUT BY HER HUSBAND,. CONSIDERING THE NUMBER OF TOURS, NUMBER OF PERSONS AND NUMBER OF DAYS FOR WHICH SUCH 4 EXPENSES INCURRED HE ESTIMATED THE EXPENSES OF RS.13,00,000/- AS INCURRED BY THE ASSESSEE AS UNEXPLAINED EXPENSES AND CONSIDERED IT AS UNDISCLOSED SOURCES AND ADDED U/S 69 OF THE I.T. ACT. 6. IN ALL THE THREE YEARS THE AO HAS ADDED RS.27,00,000/- DISTRIBUTING IT IN 3 DIFFERENT YEARS OVER AND ABOVE RS.36,00,000/-. NEITHER THE ASSESSEE NOR THE AO HAS GIVEN THE CORRECT WORKING, HENCE THE ADDITION OF RS.13,00,000/- IN THIS YEAR I S REDUCED TO RS.8,00,000/-. RELIEF OF RS.5,00,000/-. LEARNED COUNSEL CONTENDS THAT ASSESSEE CATEGORICALL Y STATED THAT ENTIRE HOUSEHOLD EXPENSES WERE BORNE BY HER HUSBAND. SIMI LARLY, IN RESPECT OF FOREIGN TRAVELS, HUSBAND OF THE ASSESSEE FILED DETA ILS OF EXPENDITURE OF RS.36 LACS AND FILED AN AFFIDAVIT FOR HAVING INCURRED THE EXPENSES ON FOREIGN TRAVEL. LEARNED COUNSEL CONTENDS THAT BOTH THE ADDITIONS AM OUNT TO PURE SURMISES AND CONJECTURES. NO INCRIMINATING MATERIAL WAS FOU ND AND IT HAS NOT BEEN PROVED THAT ASSESSEE INCURRED ANY HOUSEHOLD EXPENSE S OR EXPENSES ON FOREIGN TRAVEL. IN VIEW OF THESE FACTS, ALL THESE ADDITIONS DESERVE TO BE KNOCKED DOWN BEING PURELY ARBITRARY AND BASED ON FI GMENTS OF IMAGINATION. LEARNED COUNSEL FAIRLY POINTED OUT THAT ALL THE PRO CEEDINGS ARE BEFORE VARIOUS AUTHORITIES. HOWEVER, IT COULD NOT BE EXPLAINED AS TO WHETHER SIMILAR ADDITIONS HAVE BEEN MADE IN THE HANDS OF ASSESSEES HUSBAND OR NOT. IT WAS PLEADED THAT THE ADDITIONS MAY BE DELETED. 5 3. LEARNED DR, ON THE OTHER HAND, CONTENDS THAT ASS ESSEE IS A PART OF GROUP OF PERSONS ON WHOM COMBINED SEARCH HAS BEEN C ARRIED OUT. ASSESSEES COUNSEL IS NOT IN A POSITION TO EXPLAIN WHETHER SIMILAR ADDITIONS HAD BEEN MADE OR NOT, THOUGH THE ASSESSMENT ORDER T ALKS OF PROTECTING REVENUE INTEREST, IT IS NOT CLEAR WHETHER THE ASSES SMENT BE CALLED PROTECTIVE IN NATURE BESIDES, IT IS NOT KNOWN WHETHER THE DEPARTM ENT HAS FILED APPEALS OR NOT. IN ANY CASE, LOOKING AT THE INTER-CONNECTIVIT Y, THE WHOLE GROUP IS TO BE SEEN TOGETHER. 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD. AS THE FACTS EMERGE, WE ARE NOT IMPRESSED THE WAY LOWER AUTHORITIES HAVE PROCEEDED TO HOLD THAT SINCE THE ASSESSEE HAS INDIVIDUAL SOURCE OF INCOME, THEREFORE, PERSONAL EXPENSES CANNOT BE RULE D OUT. IN OUR VIEW, THIS IS NOT A WAY TO ESTIMATE SOMEBODYS HOUSEHOLD EXPEN SES MORE SO WHEN THE ASSESSEE HAS POINTED OUT THAT THE EXPENSES HAVE BEE N BORNE BY HER HUSBAND. SIMILARLY, IN RESPECT OF FOREIGN TRAVEL, WE ARE OF THE VIEW THAT ONCE IT HAS BEEN HELD THAT RS.36 LACS HAS BEEN SPENT BY THE HUS BAND AND THE SAME HAS BEEN HELD TO BE MORE LOGICAL AND ON PREPONDERANCE O F PROBABILITIES, THE EXCESS, IF AT ALL, HAS TO BE ADDED IN THE HANDS OF THE HUSBAND AND NOT THE ASSESSEE. BE THAT AS IT MAY, THESE ARE OUT OBSER VATIONS. IN ANY CASE, LEARNED COUNSEL FOR THE ASSESSEE COULD NOT TELL US AS TO WH ETHER SIMILAR ADDITIONS HAVE 6 BEEN MADE IN THE HANDS OF HUSBAND OR NOT. WE ALSO EXPRESS OUR DISPLEASURE ON THE ADHOCISM ADOPTED BY LOWER AUTHORITIES. IN V IEW THEREOF, SINCE THERE ARE CERTAIN HANDICAPS TO CRYSTALLIZE THE FACTS AND WE ARE SUPPOSED TO GIVE FINAL FINDING OF FACTS, WE DEEM IT EXPEDIENT TO SET ASIDE ALL THESE APPEALS BACK TO THE FILE OF CIT(A) TO KEEP OUR OBSERVATIONS IN H IS MIND AND EXAMINE THE DETAILS AND CONNECTED CASE RECORDS AGAIN AND TO PAS S APPROPRIATE ORDERS IN ACCORDANCE WITH LAW AFTER HEARING THE ASSESSEE AND ON VERIFICATION OF RECORD IN ACCORDANCE WITH LAW. 5. ALL THE APPEALS OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 29 TH JUNE, 2009. SD/- SD/- (A.K. GORADIA) (R.P. TOLANI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 29 TH JUNE, 2009 VIJAY COPY TO: 1. APPELLANT 2. RESPONDENT. 3. CIT 4. CIT(A)-I, NEW DELHI. 5. DR ASSISTANT REGISTRAR