Smt. Usha Pandurang Kulkarni, Aurangabad V. Principal Commissioner of Income-tax : 2,

ITA 530/PUN/2016

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 6075 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 9 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 28-03-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI R.S. SYAL, VICE PRESIDENT AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER . / ITA NO.530/PUN/2016 / ASSESSMENT YEAR : 2011-12 SMT. USHA PANDURANG KULKARNI, PROP. OF SHARDA EARTH MOVERS, PLOT NO.32, SHRINIWAS, GURUKUNJ HOUSING SOCIETY, TILAKNAGAR, AURANGABAD 431005 PAN : ALLPK1791Q VS. PR. CIT-2, AURANGABAD (APPELLANT) (RESPONDENT) / ORDER PER R.S.SYAL, VP : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 10.02.2016 PASSED BY THE PR. CIT-2, AURANGABAD U/S.263 OF THE INCOME-TAX ACT, 1961 (HEREINAFTER ALSO CALLED `THE ACT) IN RELATION TO THE ASSESSMENT YEAR 2011-12. APPELLANT BY SHRI CHARUHAS D. UPASANI RESPONDENT BY SHRI AMOL KAMAT DATE OF HEARING 22-01-2019 DATE OF PRONOUNCEMENT 23 -01-2019 ITA NO.530/PUN/2016 SMT. USHA P. KULKARNI 2 2. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT, THE ASSESS EE, AN INDIVIDUAL, IS A PROPRIETOR OF M/S. SHARDA EARTH MOVERS. SH E IS ENGAGED IN THE BUSINESS AS CIVIL CONTRACTOR ALONG WITH HIRING OF EQUIPMENTS FOR CONSTRUCTION ACTIVITY. ASSESSMENT IN THIS CASE W AS COMPLETED U/S.143(3) OF THE ACT ON 03-01-2014 DETERMINING TO TAL INCOME AT RS.14,90,355/- AS AGAINST THE RETURNED INCOME O F RS.8,51,000/-. IN EXERCISE OF POWER U/S.263, THE LD. PR . CIT NOTICED THAT THE AO, WHILE FINALIZING THE ASSESSMENT, FAILED TO EXAMINE TH E PURPOSE FOR WHICH CERTAIN INTEREST FREE LOANS WERE ADVANCE D TO SISTER CONCERNS. IT WAS FURTHER OBSERVED THAT THE ASSESSE E HAD BORROWED CERTAIN LOANS FROM BANKS. IN THIS HUE OF THE MA TTER, HE OPINED THAT THE ADVANCING OF INTEREST FREE LOANS BY THE ASS ESSEE TO SISTER CONCERNS CAUSED PREJUDICE TO THE INTEREST OF THE REVE NUE AND RENDERED THE ASSESSMENT ORDER ERRONEOUS. THE ASSESSE E IS AGGRIEVED BY SUCH A DECISION. 3. WE HAVE HEARD BOTH THE SIDES AND GONE THROUGH THE RELE VANT MATERIAL ON RECORD. IT IS OBSERVED THAT THE LD. PR. CIT EX ERCISED SIMILAR POWER U/S.263 IN RESPECT OF A.YRS. 2003-04, 2004 -05 AND 2006-07. THE ASSESSEE CHALLENGED SUCH ORDERS BEFORE THE TRIBUNAL. VIDE ORDER DATED 31-10-2017, THE TRIBUNAL IN ITA NOS.849 TO 851/PUN/2015 HAS ALLOWED THE APPEALS FILED BY THE ASSESSEE. IT ITA NO.530/PUN/2016 SMT. USHA P. KULKARNI 3 CAN BE SEEN FROM THE ORDER PASSED BY THE TRIBUNAL, A C OPY OF WHICH HAS BEEN PLACED ON RECORD, THAT THE ASSESSMENT ORDER WAS REVISED, INTER ALIA, ON A SIMILAR GROUND THAT THE ASSESSEE ADVANCED INTEREST FREE LOANS WHILE SHE HAD BORROWED INTEREST BEARING FUNDS. THE TRIBUNAL APART FROM OTHERS NOTICED ON PAGE 8 OF ITS ORDER TH AT ..IN THE PRESENT CASE, BEFORE US REVENUE HAS NOT PLAC ED ANY MATERIAL ON RECORD TO DEMONSTRATE AS TO HOW THE ORDER PASSE D BY THE AO WAS NOT IN ACCORDANCE WITH LAW OR THE VIEW ADOPTED B Y THE AO WAS IMPERMISSIBLE IN LAW. IN THE PRESENT FACTS, WE ARE THEREFORE OF THE VIEW THAT THE LD. PR. CIT WAS NOT JUSTIFIED IN INVOKING THE REVISIONARY POWERS U/S.263 OF THE ACT MORE SO AS THE PROVISIONS OF SECTION DO NOT VISUALIZE THE CASE OF SUBSTITUTION OF JUDGMENT OF THE LD. CIT FOR THAT OF AO WHO PASSED THE ORD ER UNLESS THE VIEW ADOPTED BY THE AO WAS NOT IN ACCORDANCE WITH LAW A ND FOR WHICH WE ALSO DRAW SUPPORT FROM THE DECISIONS CITED HER EIN ABOVE. 4. IT IS APPARENT FROM THE ORDER PASSED BY THE TRIBUNAL THA T THE FACTOR CONSIDERED BY THE LD. PR. CIT CALLING FOR INVOCATION OF THE PROVISIONS OF SECTION 263 OF THE ACT FOR THE INSTANT YEAR IS A SIMILAR TO THE ONE CONSIDERED BY HIM FOR THE PRECEDING YEARS, W HICH VIEW HAS BEEN SET ASIDE BY THE TRIBUNAL. NO MATERIAL HAS BEEN PLACED ON ITA NO.530/PUN/2016 SMT. USHA P. KULKARNI 4 RECORD TO DEMONSTRATE THAT THE SAID ORDER OF TRIBUNAL HAS BE EN REVERSED OR MODIFIED IN ANY MANNER. RESPECTFULLY FOLLOWING THE PRECEDENT, WE SET-ASIDE THE IMPUGNED ORDER. 5. IN THE RESULT, THE APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 23 RD JANUARY, 2019. SD/- SD/- (PARTHA SARATHI CHAUDHURY) (R.S.SYAL) JUDICIAL MEMBER VI CE PRESIDENT PUNE; DATED : 23 RD JANUARY, 2019 / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT; 2. / THE RESPONDENT; 3. THE PR.CIT -2, AURANGABAD 4. , , / DR B, ITAT, PUNE; 5. / GUARD FILE. // TRUE COPY // / BY ORDER, // TRUE COPY // SENIOR PRIVATE SEC RETARY , / ITAT, PUNE ITA NO.530/PUN/2016 SMT. USHA P. KULKARNI 5 DATE 1. DRAFT DICTATED ON 22-01-2019 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 22-01-2019 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS 7. DATE OF UPLOADING ORDER SR.PS 8. FILE SENT TO THE BENCH CLERK SR.PS 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK 10. DATE ON WHICH FILE GOES TO THE A.R. 11. DATE OF DISPATCH OF ORDER. *