Smt. Sushilabai Jani W/o Shri samirmal Jsain, Indore V. The ITO, Indore

ITA 399/IND/2009

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 0041 (ITAT-INDORE)
• Duration Of Justice: 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-08-2009
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 17-08-2009
• Assessment Year: 2000-2001
• Appeal Filed On: 03-08-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: APARNA KARAN
• Assessee Lawyers: T N UNNI
• Section: 147; 148; 154

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, S.M.C. BENCH I, INDORE BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER I.T.A.NO.399/IND/2009 A. Y. : 2000-01 SMT.SUSHILABAI JAIN,L/H I.T.O.,WARD NO.5(3), OF LATE SHRI SAMIRMAL JAIN, VS. INDOR E. 301, SHREENATHSREY, RACE COURSE ROAD, INDORE. APPELLANT RESPONDENT APPELLANT BY : SHRI T.N.UNNI, C.A. RESPONDENT BY : SMT. APARNA KARAN, ADDL. CIT DR O R D E R THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF CIT(A)- II, INDORE, DATED 15 TH MAY, 2009, FOR ASSESSMENT YEAR 2000-01. 2. I HAVE HEARD THE LEARNED REPRESENTATIVES OF BO TH THE PARTIES AND GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. 3. THE LEARNED CIT(A) NOTED IN THE IMPUGNED ORDER T HAT THE DECEASED ASSESSEE SHRI SAMEERMAL JAIN ALONGWITH HIS TWO BROT HERS SHRI MANGILAL JAIN AND SHRI GAMBHIRMAL JAIN OWNED A BUILDING, WHICH WAS LE T OUT TO STATE BANK OF INDIA. THEY HAD 1/3 RD UNDIVIDED OWNERSHIP IN THE SAID PROPERTY AND ASSES SED TO 2 TAX SEPARATELY AS INDIVIDUALS AND THEIR RESPECTIVE SHARES IN THE SAID PROPERTY WERE INCLUDED/ASSESSED IN THEIR HANDS. DURING THE A SSESSMENT YEAR UNDER APPEAL, THEY RECEIVED ARREARS OF RENT AMOUNTING TO RS. 18 LAKHS FOR THE PERIOD 1.3.1986 TO 1.3.1996 FROM THE BANK. THE ASSESSEE CL AIMED THAT THE ARREARS OF RENT WERE NOT ALLOWABLE TO BE INCLUDED IN THE TOTAL INCOME FOR THE ASSESSMENT YEAR UNDER APPEAL. THE AO, HOWEVER, REOPENED THE AS SESSMENT U/S 147 AND COMPUTED THE TOTAL INCOME ASSESSING THE SHARE IN AR REARS OF RENT UNDER THE HEAD HOUSE PROPERTY. THE LD. CIT(A) CONFIRMED THE ADDITION MADE BY THE AO, BUT DIRECTED TO ASSESS THE ARREARS OF RENT UNDER TH E HEAD OTHER SOURCES. IN THE SECOND APPEAL, THE TRIBUNAL HELD THAT ARREARS O F RENT IS ASSESSABLE UNDER THE HEAD HOUSE PROPERTY AND IN THE YEAR TO WHICH IT RELATES. THE AO GAVE APPEAL EFFECT FOR THE ASSESSMENT YEAR UNDER APPEAL AS PER ORDER OF THE TRIBUNAL AND ALSO ISSUED NOTICE U/S 148 FOR THE EAR LIER ASSESSMENT YEARS 1987- 88 TO 1996-97 FOR THE PURPOSE OF INCLUDING THE ASSE SSEES SHARE IN THE ARREARS OF RENT IN THE SAID ASSESSMENT YEARS AS PER DIRECTI ON OF THE TRIBUNAL. THE AO THEREAFTER SUGGESTED THE REFUND AGAINST THE TAX DEM AND LIKELY TO BE RAISED IN THE ASSESSMENT YEAR 1987-88 TO 1996-97 AND, ACCORDI NGLY, INTIMATION U/S 245 OF THE ACT WAS ISSUED BY THE A.O. THE ASSESSEE PREF ERRED TWO APPEALS BEFORE THE LD. CIT(A) IN I.T.A.NOS. 35 & 36/8-9. THE LD. C IT(A) HELD THAT NO APPEAL LIES AGAINST THE INTIMATION U/S 245 OF THE ACT ISSUED BY THE A.O. TO THE ASSESSEE. 3 THE LD. COUNSEL FOR THE ASSESSEE CONCEDED THAT THE ASSESSEE DID NOT PREFER ANY APPEAL BEFORE THE TRIBUNAL AGAINST THESE APPEALS DE CIDED BY THE LD. CIT(A). THE LD. CIT(A) IN THE IMPUGNED ORDER APART FROM DECIDIN G THE ABOVE APPEAL NOS. 35 & 36 OF THE ASSESSEE ALSO DECIDED APPEAL NO. 47/08- 09, WHICH WAS PREFERRED AGAINST THE ORDER PASSED BY THE AO U/S 154 OF THE I NCOME-TAX ACT. THE LD. CIT(A) CONSIDERING THE SUBMISSION OF THE ASSESSEE N OTED THAT THE ASSESSEE HAS FILED APPLICATION U/S 154 OF THE ACT TO MODIFY THE INTIMATION U/S 245 OF THE ACT, WHICH IS REJECTED BY THE AO. THE LD. CIT(A) ALSO NO TED THAT NO APPEAL LIES AGAINST THE INTIMATION U/S 245 OF THE ACT. THEREFOR E, THE APPEAL FILED AGAINST THE REJECT OF APPLICATION U/S 154 FOR MODIFYING THE INTIMATION U/S 245 DOES ALSO NOT LIE. THE APPEAL OF THE ASSESSEE AGAINST THE ORD ER U/S 154 WAS HELD TO BE NOT MAINTAINABLE AND WAS, ACCORDINGLY, DISMISSED. 4. THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT APPLICATION U/S 154 WAS FILED BEFORE THE AO, WHICH WAS REJECTED. THEREFORE, THE APPEAL LIES BEFORE THE LD. CIT(A) AGAINST THE ORDER U/S 154 OF THE I.T. AC T. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT NO DEMAND ARISES FOR THE EA RLIER YEARS AGAINST WHICH THE AO HAS ADJUSTED THE REFUND. THEREFORE, THE ACTI ON OF THE AO WAS AGAINST THE LAW. HE HAS FILED COPY OF THE INTIMATION U/S 24 5 FOR SET OFF OF REFUND DATED 23.7.2008 IN THE PAPER BOOK AT PAGE 20. HE HAS SUBM ITTED THAT THE ASSESSEE PREFERRED APPLICATION U/S 154 OF THE I.T.ACT DATED 22.8.2008 AGAINST INTIMATION 4 U/S 245 OF THE I.T.ACT FOR SET-OFF OF THE REFUND, C OPY OF WHICH IS FILED AT PB 33. HE HAS, THEREFORE, SUBMITTED THAT THE APPEAL LIES B EFORE THE LD. CIT(A). THEREFORE, THE MATTER MAY BE REMANDED TO THE LD. CI T(A) FOR DECIDING THE APPEAL OF THE ASSESSEE ON MERITS. 5. ON THE OTHER HAND, THE LD. DR RELIED UPON THE OR DER OF THE LD. CIT(A) AND SUBMITTED THAT SINCE 154 APPLICATION WAS FILED AGAI NST THE INTIMATION U/S 245 OF THE ACT, THEREFORE, THE LD. CIT(A) WAS JUSTIFIED IN REJECTING THE APPEAL OF THE ASSESSEE. THE LD. DR SUBMITTED THAT ACTION U/S 245 IS ADMINISTRATIVE IN NATURE AND NO APPEAL LIES AGAINST THAT INTIMATION. 6. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND MATE RIAL AVAILABLE ON RECORD. IT IS ADMITTED FACT THAT THE TRIBUNAL EARLIER DECID ED THE APPEAL HOLDING THAT THE ARREARS OF RENT RECEIVED IN RESPECT OF THE PROPERTY ARE TO BE TAXED UNDER THE HEAD INCOME FROM HOUSE PROPERTY IN THE RELEVANT A SSESSMENT YEAR. THE AO, ACCORDINGLY, REOPENED THE ASSESSMENTS FOR THE EARLI ER YEARS. THE AO ISSUED INTIMATION U/S 245 DATED 23.7.2008 FOR SET OFF OF T HE REFUND. (PB-20). THE ASSESSEE PREFERRED APPEAL AGAINST THE INTIMATION U/ S 245 OF THE I.T. ACT, BEFORE THE LD. CIT(A) IN TWO APPEAL AND BOTH WERE DISMISSE D BEING NO APPEAL LIES AGAINST THE INTIMATION U/S 245 OF THE I.T. ACT. ADM ITTEDLY, THE ASSESSEE DID NOT PREFER ANY APPEAL AGAINST THE AFORESAID ORDER OF TH E LD. CIT(A) PASSED BY THE SAME IMPUGNED ORDER. THEREFORE, THE MATTER TO THAT EXTENT HAS BECOME FINAL 5 BETWEEN THE PARTIES. SINCE THIS ISSUE IS ARISING U/ S 245 OF THE I.T.ACT, THEREFORE, IT WOULD BE RELEVANT TO REPRODUCE THE SAID SECTION FOR CONSIDERATION AND THE SAME IS REPRODUCED AS UNDER :- 245. WHERE UNDER ANY OF THE PROVISIONS OF THIS ACT, A REFUND IS FOUND TO BE DUE TO ANY PERSON, THE [ASSESSING] OFFICER, [DEPUTY COMMISSIONER], AS THE CASE MAY BE, MAY, IN LIEU OF PAYMENT OF THE REFUND, SET OFF THE AMOUNT TO BE REFUNDED OR ANY PART OF THAT AMOUNT, AGAINST THE SUM, IF ANY, REMAINING PAYABLE UNDER THIS ACT BY THE PERSON TO WHOM THE REFUND IS DUE, AFTER GIVING AN INTIMATION IN WRITING TO SUCH PERSON OF THE ACTION PROPOSED TO BE TAKEN UNDER THIS SECTION. 7. CONSIDERING THE ABOVE PROVISIONS AND INTIMATION ISSUED U/S 245 OF THE INCOME-TAX ACT, IT IS CLEAR THAT THE AO ISSUED SUCH INTIMATION FOR SET OFF OF THE REFUND AGAINST TAX REMAINING PAYABLE. NO APPEAL LIE S AGAINST THAT ORDER BEFORE THE CIT(A) AND ADMITTEDLY, THE LD. CIT(A) DISMISSE D THE APPEALS OF THE ASSESSEE AGAINST INTIMATION U/S 245 OF THE I.T. ACT AND NO APPEAL IS ADMITTEDLY PREFERRED AGAINST THE SAID ORDER BEFORE THE TRIBUNA L. IT, THEREFORE, MAKES CLEAR 6 THAT THE ACTION OF THE AO U/S 245 OF THE I.T.ACT W AS AN ADMINISTRATIVE ACTION FOR ADJUSTMENT AND SET-OFF OF THE REFUND AGAINST TH E TAX REMAINING PAYABLE. ONCE THE ASSESSEE DID NOT SUCCEED BEFORE THE CIT(A) IN THE PROCEEDINGS U/S 245 BEING THE APPEAL NOT MAINTAINABLE, THE ASSESSEE CANNOT BE ALLOWED TO CHANGE THE NATURE OF THE PROCEEDINGS BY RESORTING T O FILE APPLICATION U/S 154 FOR RECTIFICATION OF THE INTIMATION U/S 245 OF THE I.T.ACT. THE APPLICATION U/S 154 OF THE I.T.ACT IS ADMITTEDLY FILED AGAINST INTIMATI ON U/S 245 OF THE I.T.ACT. THUS, WHEN NO SUBSTANTIVE APPEAL IS PROVIDED IN I.T.ACT A GAINST THE ORDER U/S 245 BEFORE THE LD. CIT(A), I AM OF THE VIEW THAT THE AS SESSEE CANNOT BE ALLOWED TO CHANGE THE NATURE OF THE PROCEEDINGS BY FILING APPL ICATION U/S 154 OF THE I.T.ACT. THE IMPUGNED ORDER UNDER SECTION 154 WOULD NOT ENHANCE THE ASSESSMENT OR REDUCE THE REFUND IN THE GIVEN FACTS AND CIRCUMSTANCES, BECAUSE IT IS A CASE UNDER SECTION 245 OF THE I.T.ACT, FOR SET-OFF OF REFUND AGAINST TAX REMAINING PAYABLE. THE LD. CIT(A) WAS, THEREFORE, J USTIFIED IN HOLDING THAT APPEAL OF THE ASSESSEE IS NOT MAINTAINABLE. HOWEVER , THERE APPEARS TO BE SOME GRIEVANCE LEFT FOR CONSIDERATION IN FAVOUR OF THE A SSESSEE THAT WHEN THERE WAS NO DEMAND ON THE DATE OF INTIMATION U/S 245 OF THE I.T.ACT, AS ARGUED BY THE LD. COUNSEL FOR THE ASSESSEE, THE MATTER SHOULD HAVE BE EN LOOKED INTO BY THE ADMINISTRATIVE COMMISSIONER, INDORE, IN THE MATTER. IN THIS VIEW OF THE MATTER, THE APPEAL OF THE ASSESSEE IS DISMISSED HAVING NO M ERIT. HOWEVER, THE ASSESSEE 7 IS AT LIBERTY TO APPROACH THE LD. CIT , INDORE, FOR REDRESSAL OF HIS GRIEVANCE, IF ANY, IN ACCORDANCE WITH LAW. 8. AS A RESULT, THE APPEAL OF THE ASSESSEE IS DISMI SSED. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 18 TH AUGUST, 2009. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DATE : 18 TH AUGUST, 2009. CPU*178