Malisetty Sudheer, Nellore V. Income Tax Officer, Ward-1, Nellore

ITA 523/Hyd/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 4047 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 1 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-05-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB-A
• Assessment Year: 2011-2012
• Appeal Filed On: 12-04-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Reasonable cause

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A : HYDERABAD (THROUGH VIDEO CONFERENCE) BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER I.T.A. NO. 523/HYD/2019 ASSESSMENT YEAR: 2011-12 MALISETTY SUDHEER, NELLORE [PAN: AHMPM6558Q] VS INCOME TAX OFFICER, WARD-1, NELLORE (APPELLANT) (RESPONDENT) FOR ASSESSEE : SMT. S.SANDHYA, AR FOR REVENUE : SHRI SUNIL KUMAR PANDEY, DR DATE OF HEARING : 22-04-2021 DATE OF PRONOUNCEMENT : 28-05-2021 O R D E R PER S.S.GODARA, J.M. : THIS ASSESSEES APPEAL FOR AY.2011-12 ARISES FROM TH E CIT(A)-TIRUPATIS ORDER DATED 25-02-2019 PASSED IN C ASE NO.CIT(A), TIRUPATI/10079/2018-19, ORDER U/S.250 OF THE INCOME TAX ACT, 1961 [IN SHORT, THE ACT]. HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. THE ASSESSEE HAS RAISED THE FOLLOWING SUBSTANTIVE GROUNDS IN THE INSTANT APPEAL: 1) THE ORDER OF THE LEARNED COMMISSIONER OF INCOME -TAX (APPEALS) IS ERRONEOUS BOTH ON FACTS AND IN LAW. 2) THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN CONFIRMING THE ADDITION OF RS.1,25,00,000/-. ITA NO. 523/HYD/2019 :- 2 -: 3) THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) OUGHT TO HAVE SEEN THAT THE AMOUNT OF RS.2,50,00,000/- WAS ENTIRE LY PAID BY THE OTHER PARTNER SRI VELLAMPALLI CHENCHU VENKATA RAMA RAO WHO IS SEPARATELY ASSESSED TO TAX. 4) THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) OUGHT TO HAVE CONSIDERED THE FACT THAT SRI VELLAMPALLI CHENCHU VE NKATA RAMA RAO FILED AN AFFIDAVIT AND ALSO STATED THAT HE PAID THE AMOUNT. 5) THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) FAILED TO ADMIT THE EVIDENCES PRODUCED AND TO SEE THE FACT THAT THE SAID SRI VELLAMPALLI CHENCHU VENKATA RAMA RAO IS A PARTNER O F THE APPELLANT IN ACQUIRING THE PROPERTY AND THAT THE AMOUNT OF RS .2,50,00,000/- WAS ENTIRELY PAID BY HIM WHICH IS ACCEPTED BY THE S AID PERSON. 6) THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) , THEREFORE, ERRED IN CONFIRMING THE ADDITION OF RS.1,25,00,000/-. 7) ANY OTHER GROUND OR GROUNDS THAT MAY BE URGED AT THE TIME OF HEARING. 3. LEARNED COUNSEL NEXT TOOK US TO THE CIT(A)S DETAILE D DISCUSSION AFFIRMING THE ASSESSING OFFICERS ACTION M AKING THE IMPUGNED ADDITION OF RS.1,25,00,000/- AS UNDER: GROUND NO.3: THE APPELLANT CONTENDED THAT HE HAS FILED A LETTER DATED 6.12.2018 ENCLOSING A COPY OF THE CONFIRMATION LETTER DATED 6 .12.2018 FROM SRI V.G.V. RAMA RAO, WHEREIN, IT WAS STATED THAT THE AP PELLANT HAS NOT PAID THE ADVANCE, BUT SRI V.G.V. RAMA RAO PAID THE ENTIRE ADVANCE. IT WAS ALSO STATED THAT THE APPELLANT WAS PREVENTED FROM A REASONABLE CAUSE FOR NOT SUBMITTING THE INFORMATION BEFORE THE AO IN PERSON. DURING THE APPELLATE PROCEEDINGS, THE LD.AR FILED C OPY OF THE AFFIDAVIT OF SRI V.G.V. RAMA RAO, DATED 7.1.2019, TO THE EFFE CT THAT HE HAS GIVEN A CONFIRMATION LETTER ON 6.12.2018, TO THE AP PELLANT, CONFIRMING THE FACT THAT THE APPELLANT HAS NOT CONTRIBUTED RS. 2.5 CRORES, BUT MET BY HIM ONLY. THE APPELLANT ALSO FILED COPY OF THE C ONFIRMATION LETTER DATED 6.12.2018 AND COPY OF THE LETTER OF THE APPEL LANT DATED 6.12.2018 ALLEGED TO HAVE BEEN SUBMITTED BEFORE THE AO ALONG WITH COPY OF COURIER RECEIPT. DURING THE APPELLATE PROCEEDINGS, THE LD.AR WAS ASK ED WHETHER THE ABOVE REFERRED DOCUMENTS ARE FILED UNDER RULE 46A O F THE I.T. RULES, OR NOT. IN THIS CONNECTION THE LD. AR HAS NOT COMME NTED UPON IT, BUT ITA NO. 523/HYD/2019 :- 3 -: STATED THAT THESE PAPERS WERE FILED FOR THE DISPOSA L OF THE GROUNDS. THE PAPERS ARE NEW EVIDENCES WHICH WERE NOT CONSIDE RED BY THE AO. THE CONFIRMATION LETTERS ARE DATED 6.12.2018 AND TH E AFFIDAVIT IS DATED 7.12.2018. THE ASSESSMENT ORDER WAS PASSED ON 6.12.2018. IN VIEW OF THIS, THE AFFIDAVIT FILED IS CERTAINLY A NEW DOCUMENT AND THOUGH THE CONFIRMATIONS WERE DATED 6.12.2018, THE SAME WERE NOT FILED BEFORE THE AO, BEFORE COMPLETION OF ASSESSMEN T, HENCE, THEY ARE ALSO NEW EVIDENCES. NEW EVIDENCES CANNOT BE ADMITTE D UNLESS THE APPELLANT ESTABLISH THAT THE REASONABLE CAUSE WHICH PREVENTED THE APPELLANT FROM FILING THE INFORMATION BEFORE THE AO . IN THIS CASE, THE APPELLANT COMPLETELY FAILED IN GIVING ANY EVIDENCE TO ESTABLISH A REASONABLE CAUSE. HENCE, THESE DOCUMENTS WERE NOT A DMITTED. MOREOVER, THE RECEIPT OF DTDC COURIER SERVICE, PROV E THE FACT THAT THESE DOCUMENTS WERE COURIERED ON 7.12.2018, AFTER THE DATE OF ASSESSMENT ORDER. LD. AR OF THE APPELLANT FAIRLY CO NCEDED THAT THESE DOCUMENTS WERE SUBMITTED TO THE OFFICE SUBSEQUENT T O THE DATE OF COMPLETION OF THE ORDER. AS DISCUSSED IN THE BRIEF FACTS, THE APPELLANT IS KNOWN FOR TAKING ADJOURNMENTS AND NOT COMPLYING TO THE NOTICES. IN CASE THE OTHER PARTY FOR THE PURCHASE GIVEN A CONFI RMATION, NOTHING PREVENTED THE APPELLANT IN SUBMITTING THE SAME DURI NG THE ASSESSMENT PROCEEDINGS. IT IS NOT THE INFORMATION, WHICH HAS TO BE COLLECTED FROM THIRD PARTIES OR UNRELATED PARTIES O R FROM OUTSIDERS, BUT IT IS THE CONFIRMATION FROM THE PERSON WHO IS PARTY TO THE AGREEMENT FOR PURCHASE OF THE SAID LANDS. THE INTENTION IN FI LING THE DETAILS SUBSEQUENT TO PASSING AN ORDER APPEARS TO BE TO THW ART THE ENQUIRY AND INVESTIGATION PROCESS. HENCE, THERE IS NO MERIT IN ARGUMENT OF THE APPELLANT AND GROUND RAISED IS DISMISSED AND THE AD DITION MADE BY THE AO IS CONFIRMED 4. LEANED AUTHORISED REPRESENTATIVE VEHEMENTLY ARGUE D DURING THE COURSE OF HEARING THAT BOTH THE LOWER AUTHOR ITIES HAVE ERRED IN LAW AND ON FACTS IN MAKING THE IMPUGNED UN- EXPLAINED ADVANCE AMOUNT ADDITION OF RS.1.25 LAKHS I N HIS HANDS. SMT.SANDHYA TOOK US TO THE ASSESSEES PAPER BO OK RUNNING INTO SEVEN PAGES INTER ALIA COMPRISING OF HIS RETURN, EXPLANATION, FILED BEFORE THE ASSESSING OFFICER AFFI DAVIT DT.07- 01-2019 OF SRI VELLAMPALLI CHENCHU VENKATA RAMA RAO CONFIRMATION DT.06-12-2018, ASSESSEES CONFIRMATIONS L ETTER DT.06-12-2018 AND STATUS OF THE REGISTERED POST DT.07-12-2 018 SENT ON HIS BEHALF TO THE ITO, WARD-1, NELLORE; RESPEC TIVELY. ITA NO. 523/HYD/2019 :- 4 -: HER CASE IN LIGHT OF ALL THIS VOLUMINOUS EVIDENCE IS THAT THE ASSESSEE HAD NOT MADE ANY PAYMENT AS IT WAS THE OTHER PERSON I.E., SRI VELLAMPALLI CHENCHU VENKATA RAMA RA O HAVING INCURRED THE ENTIRE EXPENDITURE OF RS.2.5 CRORES IN FAVOUR OF SRI GORANTLA RADHA KRISHNA TOWARDS SALE AGREEMENT. LEARNED COUNSEL THEREFORE URGED TO REVERSE BOTH THE LOWER AUTHOR ITIES ACTION MAKING THE IMPUGNED ADDITION. 5. MR.PANDEY HAS STRONGLY SUPPORTED THE IMPUGNED ADDITION MADE IN THE COURSE OF ASSESSMENT AND AFFIRMED IN THE CIT(A)S ORDER. 6. WE HAVE HEARD THE RIVAL CONTENTIONS AGAINST AND IN SUPPORT OF THE IMPUGNED ADDITION. THE UN-DISPUTED FACT TH AT EMERGES HEREIN IS THAT BOTH THE LEARNED LOWER AUTHORI TIES HAVE ASSESSED THE ASSESSEE QUA THE SUM IN ISSUE OF RS.1.25 LAKHS GOING BY AGREEMENT ENTERED ALONG WITH SRI VELLAMPALLI CHENCHU VENKATA RAMA RAO (CO-VENDEE) AND PAID TO SRI GORANTLA RADHA KRISHNA FOR PURCHASE OF IMMOVEABLE PR OPERTY IN THE RELEVANT PREVIOUS YEAR. THE ASSESSEES STAND H AS DENIED TO HAVE MADE ANY PAYMENT ALL ALONG. HE HAS ALSO SOUG HT TO SHIFT THE ENTIRE PAYMENTS BURDEN ON THE CO-VENDEE AS W ELL. WE FIND DURING THE COURSE OF HEARING THAT THE CORRESPON DING AGREEMENT NOWHERE FORMED PART OF RECORD AS WELL WHICH COULD SUGGEST ANYTHING TO THIS EFFECT. LEARNED COUNSEL HAS A LSO NOT PLEADED THAT THE SAID AGREEMENT HAD FURTHER SPECIFIED SH ARE OF THE IMMOVEABLE PROPERTY BETWEEN ASSESSEE AND THE OTHE R CO- VENDEE TO THE EXTENT OF LESS THAN HALF EACH. THE ONLY I NFERENCE THAT COULD BE DRAWN IN ABSENCE OF ANY SUCH EVIDENCES OR A CLAUSE HAVING EARMARKED PAYMENT; VENDEE-WISE, LEADS TO THE ITA NO. 523/HYD/2019 :- 5 -: CONCLUSION THAT BOTH OF THEM HAVE INCURRED EQUAL AMOUNT OF EXPENDITURE OF RS.1,25,00,000/- EACH FORMING SUBJEC T MATTER OF THE IMPUGNED ADDITION. 6.1. THE ASSESSEE TRIED TO FURTHER PLACE RELIANCE ON TH E CO- VENDEES AFFIDAVIT DT.07-01-2019 I.E., MUCH AFTER THE C IT(A)S LOWER APPELLATE ORDER AND THAT TOO, IN ABSENCE OF ANY SUCH MATERIAL EVIDENT FROM THE AGREEMENT. WE THUS CONFIRM BOTH THE LOWER AUTHORITIES ACTION MAKING THE IMPUGNED ADDITION OF RS.1,25,00,000/- IN ASSESSEES HANDS. 7. THIS ASSESSEES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH MAY, 2021 SD/- SD/- (LAXMI PRASAD SAHU) (S.S.G ODARA) ACCOUNTANT MEMBER JUDICIAL MEM BER HYDERABAD, DATED: 28-05-2021 TNMM ITA NO. 523/HYD/2019 :- 6 -: COPY TO : 1.MALISETTY SUDHEER, S/O.SRI NAGABHUSHANAM, D.NO. 19-44A, BALAJI NAGAR, NELLORE. 2.THE INCOME TAX OFFICER, WARD-1, NELLORE. 3.CIT(APPEALS)-TIRUPATI. 4.PR.CIT-TIRUPATI. 5.D.R. ITAT, HYDERABAD. 6.GUARD FILE.