Smt. D.Padmaja, Secunderabad V. ACIT, Hyderabad

ITA 499/HYD/2010

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 3201 (ITAT-HYDERABAD)
• Duration Of Justice: 1 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-06-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2003-2004
• Appeal Filed On: 07-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: H PHANI RAJU
• Assessee Lawyers: V SRINIVAS
• Keywords: Gift; Salary income; Opportunity of being heard; Additional evidence
• Section: 142(1); 143(2)

Judgement Text

ITA NOS 493 & 494/H/10 SMT. D. PADMAJA, HYD. 1 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD BEFORE SHRI G.C. GUPTA, VICE PRESIDENT AND SHRI AKBER BASHA, ACCOUNTANT MEMBER ITA NOS.498 & 499/HYD/10 : ASTT. YEARS: 2 001-02 & 2003- 04 SMT. D. PADMAJA, SECUNDERABAD. PAN: AEJPD 7429 K VS THE ACIT, CIR-1(3), HYDERABAD. (ASSESSEE) (RESPONDENT) APPELLANT BY : SRI. V. SRINIVAS RESPONDENT BY : SRI. H. PHANI RAJU O R D E R PER AKBER BASHA, ACCOUNTANT MEMBER: THESE APPEALS BY THE ASSESSEE ARE DIRECTED AGAINS T THE COMMON ORDER OF THE CIT (A)-II, HYDERABAD DATED 25-1-2010 P ERTAINING TO THE ASSESSMENT YEARS 2001-02 AND 2003-04. SINCE COMMON AND IDENTICAL ISSUES ARE INVOLVED IN THESE APPEALS, THESE ARE HEARD, TAK EN UP TOGETHER AND DISPOSED OFF BY THIS COMBINED ORDER FOR THE SAKE OF CONVENIENCE. 2. GROUNDS RAISED BY THE ASSESSEE IN ITA NO.498/H/2 010 READ AS FOLLOWS:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE ORDER OF THE LEARNED CIT (A) IS ERRONEOUS AND BAD IN LAW, TO THE EXTENT PREJUDICIAL TO THE ASSESSEE. ITA NOS 493 & 494/H/10 SMT. D. PADMAJA, HYD. 2 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE THE LEARNED CIT(A) ERRED IN UPHOLDING THE ADDITION OF RS.1,40,0 00 BEING THE AMOUNT RECEIVED FROM ASSESSEE'S HUSBAND IN THE EARL IER YEAR NOW CONVERTED INTO GIFT.' 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL DERIVING INCOME FROM SALARY, HOUSE PROPERTY AND INC OME FROM OTHER SOURCES. THE ASSESSEE IS WIFE OF DR. D. RAMESH. A SEARCH AN D SEIZURE OPERATION UNDER SECTION 132A OF INCOME-TAX ACT WAS CONDUCTED BY THE INCOME-TAX DEPARTMENT ON 3-11-2004 IN THE CASES OF DR. D. RAME SH AND M/S. HEALING TOUCH HOSPITAL AND INSTITUTE OF CHILD HEALTH PVT. LIM ITED. DURING THE COURSE OF SCRUTINY PROCEEDINGS IN THE CASE OF DR. D. RAMES H AND M/S HEALING TOUCH HOSPITAL AND INSTITUTE OF CHILD HEALTH PVT. LIMITED, SOME EVIDENCES HAVE BEEN FOUND IN THE CASE OF MRS. D. PADMAJA, WHICH ARE NOT REFLECTED IN HER ORIGINAL RETURNS OF INCOME. BASED ON THIS, NOTICES UNDER SE CTION 153C WAS ISSUED AND SERVED ON THE ASSESSEE TO FILE RETURN OF INCOME ON 10-11-2006. THE ASSESSEE FILED ITS RETURN OF INCOME IN RESPONSE TO THE NOTICE ON 8-12-2006. ON RECEIPT OF RETURNS, STATUTORY NOTICES UNDER SECT ION 143(2) AND 142(1) WERE ISSUED ON 8-12-2006 AND SERVED ON THE ASSESSEE . FOR ASSESSMENT YEAR 2000-01, THE ASSESSING OFFICER COMPLETED THE ASSESS MENT BY MAKING AN ADDITION OF RS.5,00,000 AS INCOME FROM UNEXPLAINED SOURCES. THE ASSESSMENT WAS COMPLETED UNDER S.143 [3] OF THE ACT AFTER MAKING SEVERAL ADDITIONS. AGGRIEVED AGAINST THE ORDER OF THE ASSE SSING OFFICER, THE ASSESSEE WENT IN APPEAL BEFORE THE CIT (A). ON APPEAL, THE C IT (A) AFTER ELABORATELY DISCUSSING THE POINT AT ISSUE, DELETED THE ADDITION ON ACCOUNT OF RENTAL INCOME AND UPHELD THE OTHER ADDITONS. AGGRIEVED A GAINST THE FINDINGS AND THE DECISION OF THE CIT(A), THE ASSESSEE IS IN APP EAL BEFORE US. THE LEARNED COUNSEL FOR THE ASSESSEE ALSO FILED ADDITIONAL EVID ENCE IN THE FORM OF CONFIRMATION LETTERS FROM DR. D. RAMESH AND BALANCE SHEETS FOR THE YEAR ENDING 31.03.2000 AND 31.03.2001 ALONG WITH THE CAP ITAL ACCOUNT AND SUBMITTED THAT THE ABOVE ADDITIONAL EVIDENCES WERE ALREADY BEFORE THE CIT ITA NOS 493 & 494/H/10 SMT. D. PADMAJA, HYD. 3 [A] WHO REFUSED TO CONSIDER THE SAME. EVEN DURING THE ASSESSMENT PROCEEDINGS, THE ADDITIONS WERE MADE WITHOUT AFFORD ING ANY OPPORTUNITY. THE LEARNED COUNSEL SUBMITTED WRITTEN SUBMISSIONS CONTE NDING THAT THE ISSUE RELATED TO THE ADDITION OF RS.1,40,000 REPAID BY TH E ASSESSEE WITHOUT REFLECTING THE SAME IN THE ASSESSEE'S BOOKS OF ACCO UNT, WAS NEVER RAISED BY THE ASSESSING OFFICER DURING THE ASSESSMENT PROCEED INGS NOR GAVE ANY OPPORTUNITY TO EXPLAIN THE SAME DURING THE COURSE O F ASSESSMENT PROCEEDINGS. THE ASSESSING OFFICER SUMMARILY MADE THE ADDITION BY GROSS MISCONCEPTION OF FACTS. EVEN THE FIRST APPELLATE AU THORITY UPHELD THE ADDITION WITHOUT CONSIDERING THE EVIDENCE FILED ON TECHNICAL REASONS AND WITHOUT PROPER APPRECIATION OF FACTS. HE SUBMITTED THAT THE ADDITIONS MADE BY THE ASSESSING OFFICER AND CONFIRMED BY THE CIT(A) AT RS .1,40,000 BEING THE AMOUNT RECEIVED FROM THE ASSESSEE'S HUSBAND IN THE EARLIER YEAR NOW CONVERTED INTO GIFT IS NOT CORRECT. ON THE OTHER H AND, THE LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT SUFFICIE NT OPPORTUNITY WAS ALREADY GIVEN TO THE ASSESSEE TO FURNISH THE DETAIL S AND NO RESPONSE FROM THE ASSESSEE. AT THIS JUNCTURE, ADDITIONAL EVIDENCE FI LED BY THE ASSESSEE CANNOT BE ADMITTED. THE DISCRETION OF THE TRIBUNAL IN ADM ITTING THE ADDITIONAL EVIDENCE WHICH WAS NOT PRODUCED BEFORE THE ASSESSIN G OFFICER OR FIRST APPELLATE AUTHORITY IS TO BE EXERCISED SPARINGLY. IN THIS REGARD, HE PLACED RELIANCE ON THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF A.K. BABU KHAN VS. CWT REPORTED IN 102 ITR 757. ON MER IT, HE SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 6. WE HAVE CONSIDERED THE SUBMISSIONS OF THE RIVAL PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS EVIDENT FRO M THE ASSESSMENT ORDER THAT THE ISSUE RELATING TO ADDITION OF RS.1,40,000 ON AC COUNT OF LOAN REPAID BY THE ASSESSEE WITHOUT REFLECTING THE SAME IN BOOKS OF A CCOUNT, WAS PUT FORTH BY THE ASSESSING OFFICER DURING THE ASSESSMENT PROCEED INGS. BUT, THE ASSESSEE HAS NOT GIVEN ANY REPLY AND STATED THAT THE RECONCI LIATION STATEMENT WILL BE FURNISHED LATER. HOWEVER, THE ASSESSEE FILED ADDITI ONAL EVIDENCE IN THE FORM OF CONFIRMATION LETTERS AND BALANCE SHEET BEFORE US WITH A REQUEST TO ADMIT ITA NOS 493 & 494/H/10 SMT. D. PADMAJA, HYD. 4 THE SAME ON THE GROUND THAT THIS ADDITIONAL EVIDENC E WAS FILED BEFORE THE CIT(A) AND WHO REFUSED TO CONSIDER THE SAME. THESE ADDITIONAL EVIDENCES FILED BY THE ASSESSEE GO TO THE ROOTS OF THE MATTER , IN THE INTEREST OF JUSTICE, WE FEEL IT PROPER ADMIT THE SAME AND REMIT BACK THE ENTIRE MATTER TO THE FILE OF THE ASSESSING OFFICER TO RECONSIDER THE ISSUE I N THE LIGHT OF THE ADDITIONAL EVIDENCES FILED BY THE ASSESSEE. IN VIEW OF THE AB OVE, THE ISSUE RELATED TO THE ADDITION OF RS.1,40,000 BEING THE LOAN REPAYMEN T CONVERTED AS GIFT IN ASSESSMENT YEAR 2001-02 AND RS.1,67,390 BEING THE G IFT RECEIVED BY THE ASSESSEE FROM HER SISTER IN ASSESSMENT YEAR 2003-04 ARE REMITTED TO THE FILE OF THE ASSESSING OFFICER FOR FRESH CONSIDERATION IN ACCORDANCE WITH LAW AFTER AFFORDING AN OPPORTUNITY OF BEING HEARD. WITH REGAR D TO THE ADDITION OF RS.67,320 IN ASSESSMENT YEAR 2003-04, BEING THE SA VINGS (DIFFERENCE), IN THE CHIT GROSS INCOME AND THE CHIT INSTALMENTS PAID , AS TAXABLE INCOME, WE FIND MERIT IN THE CONTENTION OF THE LEARNED DEPARTM ENTAL REPRESENTATIVE THAT THE CHIT DIVIDEND IS IN THE NATURE OF INTEREST INCO ME WITHIN THE MEANING OF THE AMOUNT PAYABLE BY THE CHIT FUND COMPANY IN RESPECT OF A CLAIM OR RIGHT OR OBLIGATION FOR THE INSTALMENTS PAID BY THE ASSESSEE TO THE CHIT FUND COMPANY. IN VIEW OF THE ABOVE, WE DO NOT SEE ANY INFIRMITY I N THE ORDER OF THE LOWER AUTHORITY IN SUSTAINING THE ADDITION MADE ON THIS A CCOUNT. HENCE THE GROUND RAISED BY THE ASSESSEE IN THIS REGARD IS DISMISSED. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSE E IN ITA NO. 498/HYD/10 IS TREATED AS ALLOWED FOR STATISTICAL PUR POSE WHEREAS THE APPEAL FILED BY THE ASSESSEE IN ITA NO.499/HYD/10 IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER WAS PRONOUNCED IN THE COURT ON 04 -6-2010. SD/- G.C.GUPTA SD/- AKBER BASHA VICE PRESIDENT ACCOUNTANT MEMBER. DT/- 4TH JUNE, 2010 ITA NOS 493 & 494/H/10 SMT. D. PADMAJA, HYD. 5 COPY FORWARDED TO: 1. D. PADMAJA, PLOT NO.6, ROAD NO.10, DHANALAXMI HOU SING SOCIETY, MARREDPALLY, SECUNDERABAD. 2 ACIT, CIR-1(3), HYDERABAD. 3. 4. THE CIT, AP, HYDERABAD. 4) CIT(A)-II, HYDERABAD. DR, ITAT, HYDERABAD. JMR *