Ku. Radhika Bafna, Indore V. The ITO, 3(2), Indore

ITA 394/IND/2010

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 2746 (ITAT-INDORE)
• Duration Of Justice: 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-07-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 16-06-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: APARNA KARAN
• Assessee Lawyers: M C MEHTA
• Keywords: Gift; Revised return

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, SMC BENCH-I, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER ITA NO.394/IND/2010 AY: 2007-08 KU. RADHIKA BAFNA INDORE PAN AKPPB4269F ..APPELLANT V/S. ITO, WARD 3(2), INDORE ..RESPONDENT APPELLANT BY : SHRI M.C. MEHTA AND SHRI HITESH CHIMNANI DEPARTMENT BY : SMT. APARNA KARAN, SR. DR ORDER THIS APPEAL HAS BEEN PREFERRED BY THE ASSESSEE CHAL LENGING THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS) DATED 16.3.2010. 2. THE FIRST GROUND RAISED IS THAT THE LD. FIRST AP PELLATE AUTHORITY ERRED IN UPHOLDING THE ASSESSMENT ORDER ASSESSING THE ENT IRE AMOUNT OF TAX FREE INCOME @ 8.5% SEARNED ON MATURITY OF RBI RELIE F BONDS 2001 (TAX FREE), RS.2,06,400/- AS INCOME FROM OTHER SOURCES, WHICH WAS 2 INADVERTENTLY OFFERED TO TAX IN THE RETURN OF THE A SSESSEE ESPECIALLY WHEN IT WAS EXEMPT UNDER THE ACT. THE CRUX OF ARGUMENTS ON BEHALF OF THE ASSESSEE IS THAT THE RETURN WAS TO BE FILED UPTO 31 .7.2007 WHEREAS IT WAS FILED ON 31.10.2007 (LATE BY THREE MONTHS). TH EREFORE, THE ASSESSEE COULD NOT REVISE ITS RETURN. IT WAS FURTHER SUBMIT TED THAT THE ASSESSEE WRONGLY OFFERED THE INTEREST BEFORE THE LEARNED ASS ESSING OFFICER. RELIANCE WAS PLACED UPON THE DECISION IN 14 ITJ 693 (INDORE BENCH) AND THE DECISION OF THE HONBLE APEX COURT IN 261 ITR 3 67 (SC) AND 107 ITR 69 (GUJ). IT WAS PLEADED THAT ONLY REAL INCOME IS TO BE ASSESSED. ON THE OTHER HAND, THE LEARNED SENIOR DR CLAIMED THAT THE ASSESSEE HERSELF DID NOT CLAIM THE SAME AS EXEMPT IN HER RET URN AND EVEN REVISED RETURN WAS ALSO NOT FILED. THE IMPUGNED ADDITION WA S ARGUED TO BE JUSTIFIED. 3. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERU SED THE MATERIAL AVAILABLE ON FILE. BRIEF FACTS ARE THAT THE ASSESS EE INVESTED AN AMOUNT OF RS.4 LACS IN RBI RELIEF BONDS 2001 (TAX FREE) ON 31 .1.2002 VIDE BOND LEDGER ACCOUNT NO. IDBKAND0004293 (INTEREST CUMULAT IVE OPTION). THE SAID BONDS WERE MATURED ON 31.1.2007 WHEREFROM THE ASSESSEE RECEIVED AN AMOUNT OF RS.6,06,400/- VIDE CHEQUE DAT ED 31.1.2007 BEARING NO. 038477 (IDBI BANK) INCLUDING TAX FREE I NTEREST OF RS.2,06,400/- (COPY OF THE CHEQUE IS AVAILABLE AT P AGE 5 OF THE PAPER 3 BOOK). WHILE FILING THE RETURN THE ASSESSEE INADVER TENTLY OFFERED THE AFORESAID TAX FREE INTEREST AMOUNT FOR TAXATION (CO PY OF THE TAX RETURN IS AVAILABLE AT PAGES 1 TO 4 OF THE PAPER BOOK). HOWEV ER, DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS, THE ASSESSEE VIDE LE TTER DATED 12.12.2008 REQUESTED THE LEARNED ASSESSING OFFICER TO EXCLUDE THE INTEREST INCOME. THE LEARNED ASSESSING OFFICER DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE ON THE REASON THAT FIRST LY THE RETURN WAS FILED AFTER DUE DATE AND SECONDLY THE RETURN WAS NOT REVI SED TO RECTIFY SUCH MISTAKE. IF THE TOTALITY OF FACTS IS ANALYSED, I A M OF THE CONSIDERED OPINION THAT THE LEARNED ASSESSING OFFICER IS NOT O NLY THE TAX COLLECTOR BUT ALSO THE QUASI JUDICIAL AUTHORITY. HE IS, THER EFORE, SUPPOSED TO ALLOW SUCH CLAIM WHICH OTHERWISE THE ASSESSEE IS ENTITLED TO. THIS POSITION WAS EVEN CLEARED BY CIRCULAR OF THE CBDT CONSIDERED IN CHOKSI METAL REFINERY; 107 ITR 63 (GUJ) WHEREIN THE ASSESSEE WAS A NEW INDUSTRIAL UNDERTAKING, DID NOT ASK FOR RELIEF AT ORIGINAL ASS ESSMENT. IT WAS HELD THAT IT WAS THE DUTY OF THE ITO TO POINT OUT AVAILA BILITY OF SUCH RELIEF, IF OTHERWISE AVAILABLE. THIS POSITION WAS FURTHER CLA RIFIED BY HONBLE APEX COURT IN CIT V. SHELLY PRODUCTS AND ANOTHER; 261 IT R 367 WHEREIN WITH ABUNDANT CAUTION THE ASSESSEE PAID EXCESS TAX. THE LEARNED ASSESSING OFFICER WAS OF THE VIEW THAT SINCE THE ASSESSEE PAI D THE TAX IN SELF ASSESSMENT, HE IS NOT ENTITLED TO REFUND. THE HON BLE APEX COURT HELD THAT IT HAS TO BE REFUNDED. THE RATIO LAID DOWN IN THE CASES OF SOURASHTRA 4 CEMENT AND CHEMICAL INDUSTRIES V. ITO; 194 ITR 659 (GUJ) (FB), CIT V. CHITTUR ELECTRIC SUPPLY CORPORATION; 212 ITR 404 (S C), CHANDRA MOHAN V. UNION OF INDIA; 241 ITR 484 (MP); DEEPCHAND JAIN V. ITO; 145 ITR 676 (P&H); GOPAL RAMNARAINYAN (R) V. ITO; 126 ITR 3 69; PHILLIP JOSEPH V. ITO; 234 ITR 846 (KERALA) ALSO SUPPORTS THE CASE OF THE ASSESSEE. THE ASSESSEE IS FURTHER FORTIFIED BY THE DECISION I N ACWT VS. RAGINI SANGHI (2010) 14 ITJ 693 (INDORE TRIBUNAL), WHEREIN EVEN THE DECISION IN GOETZE INDIA LIMITED V. CIT (2007) 8 ITJ 120 (SC) H AS BEEN CONSIDERED, WHEREIN THE ISSUE WAS FOR CLAIM OF DEDUCTION WHEREA S IN THE CASE OF THE ASSESSEE, THE INTEREST INCOME WAS FROM TAX FREE BON DS. THEREFORE, I HOLD THAT ONLY REAL INCOME IS TO BE ASSESSED OR IN OTHER WORDS ONLY CORRECT INCOME IS TO BE TAXED. IT IS THE DUTY OF THE LEARN ED ASSESSING OFFICER TO GRANT EXEMPTION EVEN IF THE ASSESSEE HAS NOT CLAIME D THE SAME IN THE RETURN OF INCOME FILED AND OTHERWISE PERMITTED BY L AW. THEREFORE, THIS GROUND OF THE ASSESSEE IS ALLOWED. 4. THE NEXT GROUND PERTAINS TO CONFIRMING THE ADDIT ION OF RS.12,011/- BY LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IN RESPECT OF GIFTS RECEIVED THROUGH CHEQUE FROM GRAND-MATERNAL UNCLE. THE CONTENTION RAISED BY THE LEARNED COUNSEL IS THAT THE GIFT WAS RECEIVED BY THE ASSESSEE FROM THE FATHER OF THE MOTHER THROUGH DRAF T AND DUE TO ILL HEALTH, CONFIRMATION COULD NOT BE FILED DURING THE ASSESSMENT STAGE BUT 5 WAS FILED BY THE MOTHER OF THE ASSESSEE ON BEHALF O F THE HER FATHER (GRAND-MATERNAL UNCLE). IT WAS POINTED OUT THAT BE FORE THE LEARNED CIT(A) THE CONFIRMATION WAS FILED FROM GRAND-MATERN AL UNCLE FOR WHICH MY ATTENTION WAS INVITED TO PAGES 7 AND 8 OF THE PA PER BOOK. ON THE OTHER HAND, THE LEARNED SENIOR DR CONTENDED THAT NO CONFIRMATION FROM THE DONOR WAS FILED BEFORE THE ASSESSING OFFICER AN D AS SUCH HE WAS JUSTIFIED IN MAKING THE IMPUGNED ADDITION. 5. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERU SED THE MATERIAL AVAILABLE ON FILE. THERE IS NO DISPUTE TO THE FACT THAT THE AMOUNT OF RS.12,011/- WAS RECEIVED FROM THE GRAND-MATERNAL UN CLE AND CONFIRMATION DATED 14.8.2009 WAS FILED BY THE MOTHE R MENTIONING PAN ALSO (PAGE 7 OF THE PAPER BOOK). THIS IS FURTHER S UPPORTED BY LETTER DATED 28.1.2010 FROM THE DONOR (PAGE 8 OF PAPER BOOK). I N VIEW OF THESE UNCONTROVERTED FACTS, THIS GROUND OF THE ASSESSEE I S ALLOWED. 6. THE LAST GROUND PERTAINS TO CONFIRMING THE ADDIT ION OF RS.7,111/- BY LEARNED COMMISSIONER OF INCOME TAX (APPEALS) RECEIV ED AS GIFT FROM COUSIN BROTHERS ON THE OCCASION OF RAKHI. THE CONT ENTION ON BEHALF OF THE ASSESSEE IS THAT THE LIST OF THE DONORS WAS VE RY MUCH FILED BEFORE THE LEARNED ASSESSING OFFICER. ON THE OTHER HAND, IT WAS CONTENDED BY THE LEARNED SENIOR DR THAT THERE WAS NO PROOF OF S UCH PAYMENT. 6 ON PERUSAL OF RECORD AND AFTER HEARING THE RIVAL S UBMISSIONS, THERE IS NO DISPUTE TO THE FACT THAT THE DETAILS OF RAKHI GIFTS WERE FURNISHED BY THE ASSESSEE (PAGE 9 OF THE PAPER BOOK) WHEREIN THE COMPLETE NAMES AND ADDRESSES, RELATION WITH THE ASSESSEE AND THE A MOUNT OF GIFT HAVE BEEN MENTIONED TOTALLING TO RS. 7,111/-. IF THE AS SESSING OFFICER WAS HAVING ANY DOUBT, NOTHING PREVENTED HIM FROM SUMMON ING THE DONORS BUT THAT WAS NOT DONE BY HIM. IN THE ABSENCE OF AN Y CONTRARY MATERIAL, THIS GROUND OF THE ASSESSEE IS ALLOWED. FINALLY, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 13 TH JULY, 2010. (JOGINDER SINGH) JUDICIAL MEMBER DATED - 13.7.2010 COPY TO: APPELLANT/RESPONDENT/CIT/CIT(A)/DR/GUARD F ILE D/-