Shyam Kumar Gupta, Kanpur V. The Income Tax Officer, Kanpur

ITA 4/LKW/2014

• Counselvise Citation: 423714 RSA 2014
• Duration Of Justice: 3 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-04-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2005-2006
• Appeal Filed On: 03-01-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ALOK MITRA
• Assessee Lawyers: PRADEEP SETH
• Keywords: Principle of natural justice; Capital receipt

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW SMC BENCH, LUCKNOW BEFORE SHRI S UNIL KUMAR YADAV , JUDICIAL MEMBER ITA NO. 04/LKW/2014 ASSESSMENT YEAR: 2005 - 06 SHYAM KUMAR GUPTA 59/40, BIRHANA ROAD KANPUR V. THE INCOME TAX OFFICER WARD 5(3) KANPUR PA N: AASPG5418L (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI. PRADEEP SETH, FCA RESPONDENT BY: SHRI. ALOK MITRA, D.R. DATE OF HEARING: 20.01.2014 DATE OF PRONOUNCEMENT: 09.04.2014 O R D E R THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST THE O RDER OF THE LD. CIT(A), INTER ALIA, ON VARIOUS GROUNDS WHICH ARE AS UNDER: - 1 . T HAT THE LEARNED C.I.T.(APPEALS) HAS ERRED IN LAW AND ON FACTS IN DISMISSING T HE GROUND RELATING TO ADDITION OF R S.20,000/ - ON ACCOUNT OF LOW HOUSEHOLD W ITHDRAWALS AS NOT PRESSED W HICH IS FACTUALLY INCORRECT AS NO SUCH C ONCESSION WAS MADE BY THE ASSESSEE'S COUNSEL. COUNSEL'S AFFIDAVIT UNDER RULE 10 OF THE INCOME TAX APPELLATE TRIBUNAL RULES IS ENCLOSED IN SUPPORT OF THIS GROUND. 2 . THAT THE LEARNED C.I.T.(APPEALS) HAS FURTHER ERRED IN LAW AND ON FACTS IN NOT DECIDING THE ABOVE GROUND ON MERIT AND IN OBSERVING THAT THE DETAILS OF EACH HEAD OF EXPENDITURE WERE NOT AVAILABLE WHICH IS CONTRARY TO THE FACTS ON RECORD PARTICULARLY, THE ASSESSEE'S WRITTEN REPLY DATED 14TH AUGUST 2006 FILED BEF ORE THE PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 2 - : A.O. 3 . THAT THE LEARNED C.I.T.(APPEALS) HAS FURTHER ERRED IN LAW AND ON FACTS IN NOT APPR ECIATING THAT THE AMOUNT OF RS. 1 LAC AWARDED AS DAMAGES BY THE DISTRICT CONSUMER FORUM WAS IN THE NATURE OF CAPITAL RECEIPT AND NOT CHARGEABLE TO TAX. 4 . THAT THE L EARNED C.I.T.(APPEALS) HAS FURTHER ERRED IN LAW AND ON FACTS IN FAILING TO APPRECIATE THE ASSESSEE'S WRITTEN SUBMISSIONS ON THE ABOVE ISSUE AND THE JUDICIAL PRONOUNCEMENT RELIED UPON IN SUPPORT THEREOF. 5 . THAT THE APPELLATE ORDER IS ARBITRARY, UNJUST, EXCESS IVE, BAD IN LAW, AND AGAINST THE PRINCIPLES OF NATURAL JUSTICE. 2 . APROPOS GROUND NO.1, IT IS NOTICED THAT THE ASSESSEE HAS DECLARED HOUSEHOLD WITHDRAWALS AT RS.58,620/ - WHICH WAS CONSIDERED TO BE LOW BY THE ASSESSING OFFICER IN THE LIGHT OF THE FACT THAT TH E ASSESSEE IS A CHARTERED ACCOUNTANT AND MADE ADDITION OF RS.20,000/ - TO COVER UP THE DEFICIENCY OF WITHDRAWALS. 3 . THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A), BUT THE LD. CIT(A) DISMISSED TH E GROUND BEING NOT PRESSED. 4 . NOW THE ASSESSEE IS BEFORE THE TRIBUNAL AND FILED AN AFFIDAVIT STATING THEREIN THAT THE COUNSEL FOR THE ASSESSEE HAS NOT MADE ANY STATEMENT IN THIS REGARD AND THE LD. CIT(A) HAS WRONGLY DISMISSED THIS GROUND BEING NOT PRESSED. THE LD. COUNSEL FOR THE ASSESSEE FURTHER SUBMITTED THA T SINCE NO STATEMENT FOR NOT PRESSING THIS GROUND WAS MADE BEFORE THE LD. CIT(A) , THIS GROUND MAY BE HEARD AND ADJUDICATED BY THE TRIBUNAL. 5 . KEEPING IN VIEW THE STATEMENT OF THE ASSESSEE, I HAVE EXAMINED THE FACT OF THE CASE IN THIS REGARD AND I FIND THAT T HE ASSESSEE HAS MADE A TOTAL WITHDRAWAL OF RS.58,620/ - TO MEET THE HOUSEHOLD EXPENSES DURING THE PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 3 - : ASSESSMENT YEAR 2005 - 06. KEEPING IN VIEW THE COST OF LIVING DURING THE RELEVANT PERIOD I.E. ASSESSMENT YEAR 2005 - 06, THIS AMOUNT CANNOT BE CALLED TO BE SUFFIC IENT TO MEET THE HOUSEHOLD EXPENSES OF THE ASSESSEE AND HIS WIFE WITH TWO CHILDREN , THOUGH THE ASSESSEE HAS CONTENDED THAT HIS CHILDREN ARE MEETING THEIR EXPENSES THEMSELVES. EVEN IN THAT CASE , THE AFORESAID AMOUNT IS NOT SUFFICIENT TO MEET THE HOUSEHOLD EXPENSES OF THE ASSESSEE AND HIS WIFE. THE ASSESSING OFFICER HAS MADE AN ADDITION OF RS.20,000/ - WHICH APPEARS TO BE QUITE REASONABLE. THEREFORE, I DO NOT FIND ANY JUSTIFICATION TO INTERFERE WITH THE SAME. ACCORDINGLY THE ADDITION MADE BY THE LOWER AUTH ORITIES IS CONFIRMED . 6 . GROUNDS NO.2 TO 4 RELATE TO THE ADDITION OF RS.67,000/ - OUT OF RS.1 LAKH DAMAGES AWARDED BY THE DISTRICT CONSUMER FORUM. 7 . IN THIS REGARD, IT IS NOTICED THAT THE ASSESSEE HAS RECEIVED COMPENSATION OF RS.1 LAKH FROM THE DISTRICT CONSUMER FORUM, OUT OF WHICH HE HAS PAID RS.63,000/ - TOWARDS CO - SHARE OF THE HOLDERS AND BALANCE OF RS.37,000/ - HAS BEEN SHOWN AS INCOME. THE ASSESSEE WAS REQUIRED TO FURNISH DETAILS OF EXPENSES INCURRED BY HIM AND THE CO - SHARE HOLDERS, BUT HE FAILED TO FURNISH T HE SAME ON THE PLEA THAT ON ACCOUNT OF LAPSE OF LONG TIME, THEY ARE NOT AVAILABLE. IN THE ABSENCE OF SUCH DETAILS , A SUM OF RS.30,000/ - WAS DISALLOWED OUT OF THE TOTAL EXPENSES OF RS.63,000/ - CLAIMED AND INCOME ON ACCOUNT OF COMPENSATION WAS TAKEN A T RS.6 7,000/ - IN PLACE OF RS.37,000/ - . 8 . THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A) WITH THE SUBMISSION THAT HE HAS PAID RS.60,000/ - TO THE OTHER SHAREHOLDERS FOR THE EXPENSES INCURRED BY THEM OUT OF COMPENSATION OF RS.1 LAKH RECEIVED BY THE ASSESSEE. IN SUPPORT OF HIS CONTENTION, THE ASSESSEE HAS FILED CASH FLOW STATEMENT, BUT THE LD. CIT(A) WAS NOT CONVINCED WITH THE EXPLANATION FURNISHED BY THE ASSESSEE. PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 4 - : 9 . NOW THE ASSESSEE IS BEFORE THE TRIBUNAL AND REITERATED HIS CONTENTIONS. DURING THE COURSE OF HE ARING OF THE APPEAL, THE ASSESSEE HAS FILED AN AGREEMENT, ACCORDING TO WHICH IT WAS AGREED UPON THAT THE ASSESSEE WILL INCUR THE EXPENSES AND PURSUE THE LITIGATION PENDING BEFORE THE DISTRICT CONSUMER FORUM AND WHATEVER AMOUNT IS RECEIVED, IT WOULD BE TREA TED AS REMUNERATION. THE LD. COUNSEL FOR THE ASSESSEE HAS ALSO PLACED RELIANCE UP ON VARIOUS JUDGMENTS WITH THE SUBMISSION THAT THE AMOUNT RECEIVED BY THE ASSESSEE WAS IN THE NATURE OF CAPITAL RECEI PT , THEREFORE, IT CANNOT BE TAXED. 10 . HAVING GIVEN A THOUGHTF UL CONSIDERATION TO THE RIVAL SUBMISSIONS AND FROM A CAREFUL PERUSAL OF THE ORDERS OF THE AUTHORITIES BELOW AND DOCUMENTS PLACED ON RECORD, I AM OF THE VIEW THAT WHATEVER AMOUNT RECEIVED BY THE ASSESSEE, IT WAS REMUNERATION AND CANNOT BE CONSIDERED AS CAPI TAL RECEIPT. THE LOWER AUTHORITIES HAVE ALREADY GIVEN A CREDIT OF THE AMOUNT PAID BY THE ASSESSEE TO THE OTH E R SHAREHOLDERS TOWARDS EXPENSES INCURRED BY THEM. SINCE HE HAS NOT FILED ANY OTHER EVIDENCE IN ORDER TO ESTABLISH THAT HE HAS PAID EXPENSES MORE THAN WHAT HA S BEEN ALLOWED BY THE LOWER AUTHORITIES, NO OTHER BENEFIT CAN BE GIVEN TO THE ASSESSEE. I, THEREFORE, FIND NO MERIT IN THIS GROUND. 11 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 9.4.2014. SD / - [ S UNIL KUMAR Y ADAV ] JUDICIAL MEMBER DATED: 9.4.2014 JJ: 0703 PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 5 - : COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR ASSISTANT REGISTRAR PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ )