Hatim Ibrahim, CHENNAI V. ITO, CHENNAI

ITA 48/CHNY/2017

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 4987 (ITAT-CHENNAI)
• Duration Of Justice: 3 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-04-2017
• Appeal Filed By: Assessee
• Bench Allotted: C
• Assessment Year: 2007-2008
• Appeal Filed On: 09-01-2017
• Court: TRIBUNAL
• Department Lawyers: A V SREEKANTH
• Assessee Lawyers: P UTTAMCHAND JAIN
• Keywords: Rectification of order
• Section: 154

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : CHENNAI , . !' BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI G.PAVAN KUMAR, JUDICIAL MEMBER ./ I.T.A.NO.48 /MDS./2017 ( / ASSESSMENT YEAR :2007-08) MR. HATIM IBRAHIM , 11,PADAVATTAMMAN STREET, KONDITHOPU, CHENNAI-79. VS. THE ITO, NON CORPORATE WARD 4(4), CHENNAI-6. PAN AAAAPH 9132 Q ( #$ / APPELLANT ) ( %&#$ / RESPONDENT ) / APPELLANT BY : MR.P.UTTAMCHAND JAIN, C.A /RESPONDENT BY : MR.A.V.SREEKANTH, JCIT, D.R / DATE OF HEARING : 29.03.2017 !' / DATE OF PRONOUNCEMENT : 12 .04 .2017 ' / O R D E R ITA NO.48 /MDS./2017 :- 2 -: PER CHANDRA POOJARI, ACCOUNTANT MEMBER THIS APPEAL IS FILED BY THE ASSESSEE, AGGRIEVED BY THE ORDER OF THE LEARNED COMMISSIONER OF TAX(A)-5, CHENNAI D ATED 01-11-2016 PASSED UNDER SEC.154 OF THE ACT. 2. THE CRUX OF THE ASSESSEES GRIEVANCE IS THAT TH E LD.CIT(A) ERRED IN CONFIRMING THE ACTION OF AO IN SUO MOTO IN VOKING SECTION 154 OF THE ACT VIDE RECTIFICATION ORDER DATED 10.09 .2012 WHEREBY AO RECOMPUTED THE EXEMPTION U/S.54F OF THE ACT BY A DDING ` 1,61,000/- FOR EXPENSES RELATING TO THE PROPERTY PU RCHASED AND DISALLOWING ` 46,000/- BEING CONSIDERATION NOT UTILIZED UNDER TH E HEAD LONG TERM CAPITAL GAINS. 3. THE FACTS OF THE ISSUE ARE THAT THE AO PASSED O RDER U/S.143(3) ACCEPTING THE RETURNED INCOME. SUBSEQUEN TLY, THE AO PASSED RECTIFICATION ORDER U/S.154 OF THE ACT DATED 10.09.2012 RE- COMPUTING THE CAPITAL GAINS ON THE REASON THAT THE ASSESSEE HAD WRONGLY CLAIMED EXEMPTION U/S.54F OF THE ACT FOR PR OPERTY TAX- ` 25,000/-, ELECTRICITY CHARGES- ` 6,000/- AND OTHER EXPENSES - ` 65,000/-; TOTALING TO ` 96,000/- IN CONNECTION WITH PURCHASE OF PROPERTY. BESIDES IT, THE AO FOUND THAT THE ADDITI ONAL AMOUNT OF ITA NO.48 /MDS./2017 :- 3 -: 65,000/- HAS BEEN WRONGLY ADDED TO THE RETURNED INC OME BRINGING THE ASSESSED INCOME TO ` 2,89,980/-. AGGRIEVED BY THE ORDER OF AO, THE ASSESSEE CARRIED THE APPEAL BEFORE THE LD.C IT(A). DURING THE REMAND PROCEEDINGS, THE AO ONCE AGAIN CO RRECTED THE ORDER PASSED U/S.154 OF THE ACT DATED 10.09.201 2 BY REFERRING TO ANOTHER RECTIFICATION ORDER DATED 16.08.2016 DEL ETING ANOTHER ` 65,000/-, THUS LD.CIT(A) SUSTAINED THE ADDITION OF ` 96,000/-. ON APPEAL, LD.CIT(A) CONFIRMED THE ACTION OF THE LD. A SSESSING OFFICER. AGAINST THIS, THE ASSESSEE IS IN APPEAL B EFORE US. 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. THE ORIGINAL ORDER PASSED BY TH E AO U/S.143(3) OF THE ACT. THE LD. ASSESSING OFFICER AL LOWED THE CLAIM OF DEDUCTION BY THE ASSESSEE AT ` 1,61,000/- WHICH INCLUDED PROPERTY TAX- ` 25,000/-, ELECTRICITY CHARGES- ` 6,000/- AND OTHER EXPENSES - ` 65,000/-; TOTALING TO ` 96,000/- WHILE PASSING THE RECTIFICATION ORDER U/S.154 OF THE ACT ON 10.09.201 2, THE AO MADE DISALLOWANCE OF ` 1,61,000/-, WHICH WAS RECTIFIED VIDE ORDER U/S.154 OF THE ACT DATED 16.08.2016 BY DELETING AN AMOUNT OF ` 65,000/- AND SUSTAINING ONLY ` 96,000/-. IN OUR OPINION, THE ORDER PASSED U/S.154 OF THE ACT BY THE AO DATED 10.09.201 2 IS VERY ITA NO.48 /MDS./2017 :- 4 -: VAGUE. HE HAS NOT GIVEN ANY REASON AS TO ON WHAT BA SIS HE TOOK UP THE CASE U/S.154 OF THE ACT, EVEN ORDER DATED 1 0.09.2012 IS ALSO NOT CORRECTLY QUANTIFIED THE EXACT AMOUNT OF D ISALLOWANCE. WHEN THE ASSESSEE WENT IN APPEAL BEFORE THE LD.CIT( A), IN THE COURSE OF REMAND PROCEEDINGS, THE AO PASSED ONE MOR E ORDER DATED 16.08.2016 BY DELETING ANOTHER ` 65,000/-, OUT OF THE ADDITION EARLIER MADE AT ` 1,61,000/-. 4.1 IN VIEW OF THIS, WE ARE OF THE OPINION THAT TH ERE IS NO BASIS TO TAKE UP THE ISSUE BY THE AO U/S.154 OF THE ACT. IN THIS CASE, THE AO WANTED TO RECTIFY THE MISTAKE, WHICH I S IN A DEBATABLE THROUGH PROCEEDINGS U/S.154 OF THE ACT. THE SCOPE U/S.154 IS VERY LIMITED. ONLY MISTAKE WHICH IS APPA RENT FROM RECORD COULD BE RECTIFIED AND THE DEBATABLE ISSUE C ANNOT BE RECTIFIED THROUGH PROCEEDINGS U/S.154 OF THE ACT. B EING SO, WE ARE OF THE OPINION THAT THERE IS NO BASIS FOR LD. ASSES SING OFFICER TO RECTIFY ASSESSMENT U/S.154 OF THE ACT. FOR THIS PURPOSE, WE PLACED RELIANCE IN THE JUDGMENT OF SUPREME COURT IN THE CASE OF ACIT VS. SHREYAS GRAMIN BANK REPORTED IN [2012] 25 ITA NO.48 /MDS./2017 :- 5 -: TAXMANN.COM 282 (SC). ACCORDINGLY, WE ALLOW THE APP EAL OF ASSESSEE. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON 12 TH APRIL, 2017, AT CHENNAI. SD/ - SD/ - ( . ) ( G.PAVAN KUMAR ) / JUDICIAL MEMBER ( ) (CHANDRA POOJARI) / ACCOUNTANT MEMBER #$ / CHENNAI %& / DATED: 12 TH APRIL, 2017. K S SUNDARAM &'(()*( +* / COPY TO: ( 1 . / APPELLANT 3. ( ,(- . / CIT(A) 5. */0 (1 / DR 2. / RESPONDENT 4. ( , / CIT 6. 02(3 / GF