ITO NCW 22 (5), TAMBARAM V. K S VELUSAMY, TAMBARAM

ITA 490/CHNY/2018

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 1647 (ITAT-CHENNAI)
• Duration Of Justice: 9 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-11-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 12-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Additional evidence
• Section: 147; 133A

Judgement Text

, , IN THE INCOME-TAX APPELLATE TRIBUNAL A BENCH, CHENNAI . , . , BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER & SHRI DUVVURU RL REDDY, JUDICIAL MEMBER ./ I T.A. NO. 490/CHNY/2018 / ASSESSMENT YEAR :2012-13 THE INCOME TAX OFFICER, NON CORPORATE WARD 22(5), TAMBARAM. VS. SHRI K.S. VELUSAMY, PROP. M/S. SVS ENTERPRISES, NO. 41, AYYASAMY STREET, SHANMUGAM ROAD, WEST TAMBARAM, CHENNAI 45. [PAN:AGUPV1463G] ( APPELLANT ) ( RESPONDENT) / APPELLANT BY : SHRI AR.V. SREENIVASAN, JCIT / RESPONDENT BY : NONE / DATE OF HEARING : 13.11.2018 /DATE OF PRONOUNCEMENT : 20.11.2018 / O R D E R PER DUVVURU RL REDDY, JUDICIAL MEMBER: THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) 10, CHENNAI DATED 31.10.2017 RELEVANT TO THE ASSESSMENT YEAR 2012-13. THE MAIN GROUND RAISED IN THE APPEAL OF THE REVENUE IS THAT THE LD. CIT(A) HAS WRONGLY INVOKED THE PROVISIONS OF RULE 46A THOUGH THE ASSESSEE HAS NOT FURNISHED ANY ADDITIONAL EVIDENCE DURING APPELLATE PROCEEDINGS AND WRONGLY ALLOWED THE EXPENDITURE. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL CARRYING ON BUSINESS IN REAL ESTATE UNDER THE NAME AND STYLE OF M/S. SVS I.T.A. NO. 490/CHNY/18 2 ENTERPRISES, TAMBARAM. A SURVEY UNDER SECTION 133A OF THE INCOME TAX ACT 1961 [ACT IN SHORT] WAS CONDUCTED IN THE ASSESSEE'S BUSINESS PREMISES ON 30/3/2012 AND THE ASSESSEE ADMITTED A TOTAL UNDISCLOSED INCOME OF .3,35,40,100/- FOR THE ASSESSMENT YEARS 2010-11 TO 2012-13. THE ENTIRE INCOME ADMITTED BY THE ASSESSEE WAS INCOME FROM HIS BUSINESS. THE ASSESSEE HAD PURCHASED A LAND FOR BUSINESS FOR A CONSIDERATION OF .2,85,00,000/- DECLARING A TOTAL NET PROFIT OF .3,61,15,693/ - FROM REAL ESTATE BUSINESS IN 3 YEARS I.E., ASSESSMENT YEARS 2010-11 TO 2012-13. THE ASSESSEE HAD NOT FILED ANY BALANCE SHEET OR STATEMENT OF AFFAIRS DISCLOSING HIS INVESTMENTS IN MOVABLE AND IMMOVABLE ASSETS. BASED ON THE FINDINGS OF THE ASSESSING OFFICER FROM THE IMPOUNDED MATERIALS DURING SURVEY PROCEEDINGS, IN THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER HAS ARRIVED AT THE TOTAL NET PROFIT FOR THE THREE ASSESSMENT YEARS. CONSIDERING THE TOTAL AMOUNT OF RECEIPTS AS PER IMPOUNDED MATERIALS AND PROPORTIONATE AMOUNTS FOR THE EXPENSES CLAIMED BY THE ASSESSEE, THE ASSESSING OFFICER COMPUTED THE ASSESSED INCOME AT .3,46,78,120/- FOR THE ASSESSMENT YEAR UNDER CONSIDERATION AND COMPLETED THE ASSESSMENT ACCORDINGLY. 3. THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A). AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, FACTS OF THE CASE AS WELL AS SECOND REMAND REPORT OF THE ASSESSING OFFICER, THE LD. CIT(A) DIRECTED THE ASSESSING OFFICER TO RECOMPUTED THE TOTAL INCOME AFTER GIVING THE RELIEF AS I.T.A. NO. 490/CHNY/18 3 SUGGESTED BY THE ASSESSING OFFICER IN THE SECOND REMAND REPORT DATED 19.06.2017. 4. AGGRIEVED, THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. THE LD. DR VEHEMENTLY ARGUED THAT ONCE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE WAS GIVEN BY THE ASSESSING OFFICER DURING THE COURSE OF FIRST REMAND PROCEEDINGS , THE LD. CIT(A) HAS WRONGLY INVOKED THE PROVISIONS OF RULE 46A CALLING FOR SECOND REMAND REPORT IN THE ABSENCE OF ANY COGENT MATERIAL OR ADDITIONAL EVIDENCE AVAILABLE BEFORE THE LD. CIT(A) AND THEREBY ALLOWING EXPENDITURE AND PLEADED THAT THE ORDER OF THE LD. CIT(A) SHOULD BE SET ASIDE. 5. DESPITE SERVICE OF NOTICE RPAD ON RECORD, NONE APPEARED ON BEHALF OF THE ASSESSEE. HENCE, WE PROCEED TO DECIDE THE APPEAL ON MERITS AFTER HEARING THE LD. DR. 6. WE HAVE HEARD THE LD. DR, PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW INCLUDING PAPER BOOK. IN THIS CASE, THE ASSESSEE HAS NOT MAINTAINED ANY REGULAR BOOKS OF ACCOUNTS. DURING THE COURSE OF SURVEY UNDER SECTION 133A OF THE ACT CERTAIN INCRIMINATING MATERIALS WERE IMPOUNDED. BASED ON THE SURVEY MATERIALS, THE ASSESSING OFFICER COMPLETED THE ASSESSMENT. BASED ON FURTHER REFERENCE FROM THE INVESTIGATION WING, THE ASSESSING OFFICER RE-OPENED THE ASSESSMENT AND COMPLETED THE ASSESSMENT UNDER SECTION 147 OF THE ACT. I.T.A. NO. 490/CHNY/18 4 AGAINST THE ADDITIONS MADE BY THE ASSESSING OFFICER, BEFORE THE CIT(A) THE ASSESSEE CONTENDED THAT THE ASSESSING OFFICER DID NOT PROVIDE REASONABLE OPPORTUNITY. IN ORDER TO GIVE REASONABLE OPPORTUNITY TO THE ASSESSEE, THE ASSESSEES SUBMISSION MADE BEFORE THE LD. CIT(A) WAS FORWARDED TO THE ASSESSING OFFICER CALLING FOR A REMAND REPORT. THE ASSESSING OFFICER SENT THE REMAND REPORT DATED 06.10.2017 TO THE LD. CIT(A), WHICH WAS FORWARDED TO THE ASSESSEE FOR REBUTTAL. IN RESPONSE TO THE AO'S AFORESAID REMAND REPORT, THE ASSESSEE FILED HIS OBJECTION DATED 27.02.2017 STATING THAT THE AO'S REMAND REPORT WAS NOTHING BUT A RECONFIRMATION OF THE ASSESSMENT ORDER WITHOUT GIVING ANY OPPORTUNITY OF BEING HEARD BEFORE SENDING THE REMAND REPORT. THE ASSESSEE HAS FURTHER ARGUED BEFORE THE LD. CIT(A) THAT THE ASSESSING OFFICER HAS SIMPLY ADDED ALL THE RECEIPTS SIDE OF THE BOOKS IMPOUNDED WHILE COMPLETELY IGNORING THE PAYMENT SIDE FOUND IN THE SAME BOOKS. WE ARE OF THE CONSIDERED OPINION THAT BEING A VALID OBJECTION RAISED BY THE ASSESSEE DURING APPELLATE PROCEEDINGS, THE OBJECTIONS OF THE ASSESSEE WAS RIGHTLY FORWARDED BY THE LD. CIT(A) AGAIN TO THE ASSESSING OFFICER FOR RE-EXAMINATION. AFTER RE-EXAMINATION, BY AFFORDING REASONABLE OPPORTUNITY TO THE ASSESSEE, THE ASSESSING OFFICER HAS SENT A REMAND REPORT DATED 19.06.2017. ON PERUSAL OF THE SAID REMAND REPORT, THE LD. CIT(A) HAS OBSERVED THAT THE ASSESSING OFFICER HAS ANALYSED ALL THE IMPOUNDED MATERIALS AND THE ASSESSEES BOOKS OF ACCOUNTS AND RECOMMENDED RELIEF WHEREVER IT WAS WARRANTED. AFTER SUMMARISING THE ORIGINAL ADDITION MADE AND I.T.A. NO. 490/CHNY/18 5 BY CONSIDERING THE RELIEF RECOMMENDED BY THE ASSESSING OFFICER IN THE SAID REMAND REPORT, WHEREVER IT WAS WARRANTED BASED ON SUPPORTING DOCUMENTS, THE LD. CIT(A) HAS DIRECTED THE ASSESSING OFFICER TO RE-COMPUTE THE TOTAL INCOME OF THE ASSESSEE. UNDER THE ABOVE FACTS AND CIRCUMSTANCES, WE FIND NO INFIRMITY IN THE ORDER PASSED BY THE LD. CIT(A) ON THIS ISSUE AND ACCORDINGLY, THE GROUNDS RAISED BY THE REVENUE ARE DISMISSED. 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON THE 20 TH NOVEMBER, 2018 AT CHENNAI. SD/- SD/- (ABRAHAM P. GEORGE) ACCOUNTANT MEMBER (DUVVURU RL REDDY) JUDICIAL MEMBER CHENNAI, DATED, THE 20.11.2018 VM/- /COPY TO: 1. / APPELLANT, 2. / RESPONDENT, 3. ( ) /CIT(A), 4. /CIT, 5. /DR & 6. /GF.