Pramod Bajaj, Kolkata V. PCIT-10, Kolkata

ITA 443/KOL/2020

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 6904 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-08-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2015-2016
• Appeal Filed On: 15-07-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Revision of order; Assessment record; TDS; Set aside
• Section: 263; 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B (VIRTUAL COURT HEARING) BENCH KOLKATA BEFORE SHRI SANJAY GARG,JUDICIAL MEMBER & DR. M. L. MEENA, ACCOUNTANT MEMBER I.T.A. NOS.443&444/KOL/2020 ASSESSMENT YEARS: 2015-16& 2016-17 PRAMOD BAJAJ ........APPELLANT 137, FLAT NO.5C, 5 TH FLOOR, S.P. MUKHERJEE ROAD KOLKATA-700026. [PAN:AEAPB6237L] VS. PCIT-10, KOLKATA.......RESPONDENT APPEARANCES BY: NONE APPEARED ON BEHALF OF THE APPELLANT. SHRI MANISH KANOJIA, CIT (DR), APPEARED ON BEHALF OF THE RESPONDENT. DATE OF CONCLUDING THE HEARING : AUGUST 05, 2021 DATE OF PRONOUNCING THE ORDER : AUGUST 06, 2021 ORDER PER BENCH: BY THIS COMMON ORDER, WE WILL DISPOSE OFF TWO APPEALS PREFERRED BY THE ASSESSEE CONTESTING THE REVISION ORDERS U/S 263 OF THE INCOME TAX ACT BOTH DATED 20.02.2020 RELEVANT TO ASSESSMENT YEARS 2015-16 AND 2016-17 PASSED BY THE PRINCIPAL COMMISSIONER OF INCOME TAX-10, KOLKATA (HEREINAFTER REFERRED TO AS PCIT) 2. NO ONE HAS PUT IN APPEARANCE ON BEHALF OF THE ASSESSEE. HOWEVER, AFTER GOING THROUGH THE IMPUGNED ORDERS AND THE AVAILABLE RECORDS ON THE FILES AND AFTER HEARING THE LD. DR, WE PROCEED TO ADJUDICATE THE CAPTIONED APPEALS. 3. FIRST, WE WILL TAKE UP THE ASSESSEES APPEAL ITA NO.443/KOL/2020 RELEVANT TO ASSESSMENT YEAR 2015-16. ITA NO.443/KOL/2020 ASSESSMENT YEAR 2015-16 4. IN THIS APPEAL, THE ASSESSEE HAS CONTESTED THE INVOCATION OF REVISION JURISDICTION BY THE LD. PCIT U/S 263 OF THE ACT, WHEREBY,HE HAS SET ASIDE THE ASSESSMENT ORDER OF THE ASSESSING OFFICER FOR DE NOVO ASSESSMENT. I.T.A. NOS.443&444/KOL/2020 ASSESSMENT YEARS: 2015-16 & 2016-17 PRAMOD BAJAJ 2 5. A PERUSAL OF THE IMPUGNED ORDER U/S 263 OF THE INCOME TAX ACT REVEALS THAT THE LD. PCIT OBSERVED THAT THE ASSESSEE HAD DEBITED CERTAIN EXPENSES VIZ. DEMAT CHARGES, DONATION AND LATE DELIVERY CHARGES TOTAL AMOUNTING TO RS.3,78,204/- WHICH WERE NOT VERIFIED BY THE ASSESSING OFFICER. HE FURTHER OBSERVED THAT IN THE RETURN OF INCOME, THE ASSESSEE HAD SHOWN PURCHASES OF RS.3,50,36,424/-, WHEREAS, AS PER THE AUDITED FINANCIAL STATEMENT, THE PURCHASES WERE SHOWN AT RS.3,05,88,554/-. THE LD. PCIT,THEREFORE, OBSERVED THAT THE ASSESSING OFFICER WITHOUT CONDUCTING NECESSARY ENQUIRY FOR RECONCILIATION OF THE ABOVE FIGURES OF THE AMOUNT HAD ACCEPTED THE SAME AS SUCH. HE, THEREFORE, ISSUED SHOW-CAUSE NOTICE TO THE ASSESSEE AS TO WHY THE REVISION PROVISIONS OF SECTION 263 OF THE INCOME TAX ACT BE NOT INVOKED IN HIS CASE. IN REPLY TO THE SHOW-CAUSE NOTICE, THE ASSESSEE STATED THAT THE ASSESSEE HAD PAID DONATION TO AN ORGANIZATION WHICH WAS ELIGIBLE FOR DEDUCTION U/S 35AC OF THE ACT. THE DONATIONTHUS PAID, WAS CLAIMED AS DEDUCTION U/S 35AC OF THE ACT. FURTHER THE ASSESSEE INCURRED DEMAT CHARGES IN THE PERSONAL CAPACITY AND THE SAME HAD BEEN CLAIMED AS EXPENSES RELATED TO EARNING OFINCOME ASSESSABLE UNDER INCOME FROM CAPITAL GAIN. THE ASSESSEE FURTHER SUBMITTED THAT THE EXPENSES HADNOT BEEN CLAIMED UNDER COMPUTATION OF INCOME. THE ASSESSEE ALSO STATED THAT THE FIGURE OFPURCHASE OF RS.2,67,13,020/- AND LABOUR CHARGES PAID RS.83,23,403/- UNDER THE HEAD PURCHASES INTHE ITR AND HAD SHOWN THE INCOME RECEIVED AGAINST LABOUR CHARGES OF RS.4447881/- SEPARATELY AS SALE OF SERVICESAS PARTIES HAD DEDUCTED TDS ON THE SAME. 5. THE LD. PCIT WITHOUT POINTING OUT ANY ERROR OR DISCREPANCY IN THE SUBMISSIONS OF THE ASSESSEE SIMPLY OBSERVED THAT THE AFORESAID EXPLANATION OF THE ASSESSEE WAS NOT MADE AVAILABLE TO THE ASSESSING OFFICER DURING THE ASSESSMENT PROCEEDINGS U/S 143(3) OF THE ACT. HE, THEREFORE, SET ASIDE THE ASSESSMENT ORDER DATED 18.12.2017 FOR DE NOVO ASSESSMENT. 6. WE HAVE GONE THROUGH THE IMPUGNED ORDER AND RECORD ON THE FILE AND HEARD THE SUBMISSIONS OF THE LD. DR. IN THIS CASE, THE LD. PCIT HAS FAILED TO MENTION AS TO HOW THE ASSESSMENT ORDER WAS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. IN RESPECT OF THE QUERIES RAISED BY THE LD. PCIT, THE ASSESSEE GAVE EXPLANATIONS. THE LD. I.T.A. NOS.443&444/KOL/2020 ASSESSMENT YEARS: 2015-16 & 2016-17 PRAMOD BAJAJ 3 PCIT COULD NOT FIND ANY ERROR OR DISCREPANCY IN THE EXPLANATION SUBMITTED BY THE ASSESSEE REQUIRING ANY FURTHER INVESTIGATION. THERE IS NO FINDING GIVEN BY THE PCIT THAT THE EXPLANATION GIVEN BY THE ASSESSEE WAS NOT JUSTIFIED OR THERE WAS ANY SCOPE OF FURTHER ENQUIRIES IN THIS RESPECT. AS PER THE PROVISIONS OF SECTION 263 OF THE ACT, THE LD. PCIT WAS SUPPOSED TO APPLY HIS MIND TO THE EXPLANATION SUBMITTED BY THE ASSESSEE AND COME TO A CONCLUSION THAT THE ORDER PASSED BY THE ASSESSING OFFICER WAS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE AND FURTHER HE WAS SUPPOSED TO MAKE OR TO CAUSE TO MAKE NECESSARY ENQUIRIES TO ARRIVE AT A CONCLUSION THAT THE ASSESSMENT ORDER IN QUESTION WAS NOT SUSTAINABLE. THE EXERCISE OF REVISIONAL JURISDICTION U/S 263 OF THE ACT HAS BEEN MADE BY THE LD. PCIT IN A CASUAL AND MECHANICAL MANNER WHICH IS NOT SUSTAINABLE IN THE EYES OF LAW. THE IMPUGNED ORDER PASSED U/S 263 OF THE ACT IS, THEREFORE, QUASHED. ITA NO.444/KOL/2020 7. IN THIS APPEAL ALSO, THE ASSESSEE HAS CONTESTED THE REVISION ORDER PASSED U/S 263 OF THE INCOME TAX ACT. THE LD. PCIT NOTED FROM THE ASSESSMENT RECORDS THAT THE ASSESSEE WAS IN POSSESSION OF FOUR FLATS APART FROM HIS RESIDENTIAL FLAT AT KOLKATA DURING THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 2016-17.HE OBSERVED THAT THE ASSESSING OFFICER HAS NOT ADDED THE NOTIONAL RENT INCOME FROM THE REST OF THREE FLATS UNDER INCOME FROM HOUSE PROPERTY. HE, THEREFORE, FORMED THE OPINION THAT THE ASSESSMENT ORDER WAS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE AND ACCORDINGLY ISSUED SHOW-CAUSE NOTICE TO THE ASSESSEE U/S 263 OF THE INCOME TAX ACT. 8. IN HIS SUBMISSION DATED 28.01.2020, THE ASSESSEE STATED THAT IT WAS A FACT THAT THEASSESSEE WAS HAVING SELF-OCCUPIED HOUSE PROPERTY AT S.P.MUKHERJEE ROAD, KOLKATA. THE ASSESSEE WAS 50% OWNER OF THE SAID PROPERTY WITH HIS WIFE MS. SARITA BAJAJ. THE ASSESSEE ALSO SUBMITTED THATTHE ASSESSEE HAD PAID ADVANCE AGAINST PROPERTY AT DLF AND THE DEED OF CONVEYANCE OF THE SAID PROPERTY WAS DATED 7 TH APRIL, 2016. THE ASSESSEE WAS 50% OWNER OF THE PROPERTY WITH HIS DAUGHTER MS. ANSHUMA RUSTAGI. THE ASSESSEE CLAIMED THAT AS THE PROPERTY WAS REGISTERED IN APRIL 2016,QUESTION OF LETTING OUT IN F.Y. 2015-16 DID NOT ARISE. THE ASSESSEE HAD LET OUT THE PROPERTY IN F.Y. 2016-17 AND I.T.A. NOS.443&444/KOL/2020 ASSESSMENT YEARS: 2015-16 & 2016-17 PRAMOD BAJAJ 4 THE RENTAL INCOME HAD ACCRUED FROM JUNE 2016. IT HAD FURTHER BEEN SUBMITTED THAT THE ASSESSEE HAD PAID ADVANCE AGAINST PROPERTY AT LT TOWER ANDTHE ASSESSEE HAD RECEIVED POSSESSION OF THE PROPERTY IN MAY 2018. THE ASSESSEE WAS JOINT OWNER OFTHE PROPERTY AT L&T PAREL PROJECT WITH ANOTHER DAUGHTER MS. ADITI CHAMARIA. THE ASSESSEE WAS 50% OWNER OF THE PROPERTY AT MERLIN, KOLKATA WITH HIS WIFE MS. SARITA BAJAJ. THE WIFE OF THE ASSESSEE HAD LET OUT THE PROPERTY DURING THE YEAR UNDER REVIEW AND WAS INRECEIPT OF THE RENTAL INCOME. THE ENTIRE TOTAL INCOME OF THE PROPERTY WAS RECEIVED BY THE WIFE OF THEASSESSEE AND SHE WAS SUBJECT TO HIGHEST RATE OF TAXATION. SHE HAD PAID SUBSTANTIAL PART OF THEPURCHASE CONSIDERATION AND AS PER UNDERSTANDING BETWEEN THE CO-OWNERS THE RENT WAS RECEIVED BY HER. 9. THOUGH, THE ASSESSEE DULY EXPLAINED ABOUT THE DATE OF COMING INTO POSSESSION OF THE SOME OF THE PROPERTIES AND THAT ON BECOMING OWNER IN POSSESSION OF THE PROPERTIES IN QUESTION, THE RENTAL INCOME WAS DULY OFFERED FOR TAXATION. FURTHER THAT IN RESPECT OF ONE PROPERTY, HIS WIFE HAD TAKEN INTO ACCOUNT THE RENTAL INCOME. HOWEVER, THE LD. PCIT IN A MECHANICAL MANNER SET ASIDE THE ASSESSMENT ORDER OBSERVING THAT THE AFORESAID EXPLANATIONS WERE NOT AVAILABLE TO THE ASSESSING OFFICER. IN VIEW OF OUR FINDINGS GIVEN ABOVE WHILE DECIDING THE APPEAL OF THE ASSESSEE IN ITA NO.443/KOL/2020, THE IMPUGNED ORDER OF THE LD. PCIT IS QUASHED. 10. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE STAND ALLOWED. ORDER IS PRONOUNCED IN THE OPEN COURT ON 06.08.2021. SD/- SD/- [DR. M. L. MEENA] [SANJAY GARG] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 06.08.2021. RS COPY OF THE ORDER FORWARDED TO: 1. PRAMOD BAJAJ 2. PCIT-10, KOLKATA 3. CIT(A)- 4. CIT- , I.T.A. NOS.443&444/KOL/2020 ASSESSMENT YEARS: 2015-16 & 2016-17 PRAMOD BAJAJ 5 5. CIT(DR), //TRUE COPY// BY ORDER SR.PS/D.D.O, KOLKATA BENCHES