B.Suresh, CHENNAI V. ITO, CHENNAI

ITA 544/CHNY/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 6315 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 06-07-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 06-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B SAGADEVAN
• Assessee Lawyers: S P PALANIAPPAN
• Keywords: Reopening of assessment; Gift; Period of limitation

Judgement Text

, .. , IN THE INCOME TAX APPELLATE TRIBUNAL , SMC A BENCH, CHENNAI . , BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ I.T.A.NO.544/MDS/2017 ( / ASSESSMENT YEAR: 2008-09) SHRI B. SURESH, NO.28A, KATHAYEE AMMAN STREET, THIRUVALI NAGAR, RAMAPURAM, CHENNAI 600 089. VS THE INCOME TAX OFFICER, NON CORPORATE WARD 8(3), CHENNAI . PAN: BFLPS0199K ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : SHRI S.P. PALANIAPPAN, CA /RESPONDENT BY : SHRI B. SAGADEVAN, JCIT /DATE OF HEARING : 06.07.2017 ! /DATE OF PRONOUNCEMENT : 24.08.2017 / O R D E R THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE LD. COMMISSIONER OF INCOME TAX (APPEA LS)-9, CHENNAI DATED 20.12.2016 IN ITA NO.37/CIT(A)-9/2015 -16 FOR THE ASSESSMENT YEAR 2008-09 PASSED U/S.250(6) R.W.S.143 (3) & 147 OF THE ACT. 2 ITA NO.544/MDS/2017 2. THE ASSESSEE HAS RAISED SEVERAL GROUNDS IN HIS A PPEAL, HOWEVER THE CRUXES OF THE ISSUES ARE AS FOLLOWS:- (I) THE LD.CIT(A) HAS ERRED IN HOLDING THAT THE REO PENING OF THE ASSESSMENT U/S.47 OF THE ACT IS GOOD IN LAW IN THE CASE OF THE ASSESSEE. (II) THE LD.CIT(A) HAS ERRED IN REJECTING THE CLAIM OF THE ASSESSEE THAT HE HAS OPENING CASH BALANCE OF RS.2,75,700/- CONSIDERING THE INCOME DECLARED BY HIM FOR THE EARL IER ASSESSMENT YEARS. (III) THE LD.CIT(A) HAS ERRED BY TREATING THE FOLLO WING TRANSACTIONS NOT GENUINE. A) GIFT FROM OTHER - RS. 2,00,000/- B) STAMP DUTY PAID BY HIS FATHER - RS. 2,82,912/- C) ADVANCE RECEIVED FROM GRANDMOTHER RS. 5,50,000 /- TOTAL - RS.10,32,912/- (IV) THE LD.CIT(A) HAS ERRED IN REJECTING THE CONST RUCTION COST OF RS.13,00,000/- WHILE COMPUTING THE CAPITAL GAIN OF THE ASSESSEE. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS AN INDIVIDUAL EARNING INCOME FROM HOUSE PROPERTY, BUSINESS & PROF ESSION AND 3 ITA NO.544/MDS/2017 CAPITAL GAINS, FILED HIS RETURN OF INCOME FOR THE A SSESSMENT YEAR 2007-08 ON 22.08.2007 ADMITTING INCOME OF RS.2,13,8 40/-. INITIALLY THE RETURN WAS PROCESSED U/S.143(1) OF THE ACT AND SUBSEQUENTLY, THE CASE WAS REOPENED AND FINALLY ASSESSMENT ORDER WAS PASSED U/S.143(3) R.W.S. 147 OF THE ACT ON 08.01.2016, WHE REIN THE LD.AO ASSESSED THE INCOME OF THE ASSESSEE AT RS.26,08,412 /-. 4. GROUND NO. 2(I) : REOPENING OF ASSESSMENT U/S.147 O F THE ACT:- AT THE OUTSET THE LD.AR SUBMITTED BEFORE US THAT I N THE CASE OF THE ASSESSEE THE NOTICE FOR REOPENING WAS DISPATCHE D ON 01.04.2015, THOUGH THE NOTICE WAS DATED 30.03.2015. EVIDENCE WAS PLACED IN THE PAPER BOOK AT PAGE NO.10 & 11. IT WAS FURTHER SUBMITTED THAT IN THE CASE OF THE ASSESSEE THE PERI OD OF LIMITATION FOR REOPENING THE ASSESSMENT EXPIRES ON 31.03.2015 AS P ER THE PROVISIONS OF SECTION 149(1)(B) OF THE ACT. THE LD. AR FURTHER RELIED IN THE DECISION OF THE HONBLE GUJARAT HIGH COURT D ATED 13.07.2010 IN THE CASE KANUBHAI M PATEL HUF VS. HIREN BHATT OR HIS SUCCESSORS TO OFFICE & 4, WHEREIN IT WAS HELD THAT THE PROCESS OF ISSUE OF NOTICE IS NOT COMPLETED UNLESS THE ENVELOPE CONTAINING THE NOTICE IS 4 ITA NO.544/MDS/2017 RECEIVED BY THE POSTAL AUTHORITIES. THE LD.AR VEHEM ENTLY ARGUED BY STATING THAT SINCE IN THE CASE OF THE ASSESSEE, THE POSTAL AUTHORITIES HAVE RECEIVED THE ENVELOPE ON 01.04.2015 AND THE LI MITATION FOR REOPENING THE ASSESSMENT U/S.147/148 &149 OF THE AC T EXPIRES ON 31.03.2015, THEREFORE THE ASSESSMENT BASED ON REOPE NING IS BAD IN LAW CONSIDERING THE DECISION OF THE HONBLE GUJARAT HIGH COURT DATED 13.07.2010 CITED SUPRA. HE THEREFORE PLEADED THAT THE ORDER OF THE LD.AO MAY BE QUASHED. THE LD.DR THOUGH ARGUED IN S UPPORT OF THE LD.REVENUE AUTHORITIES COULD NOT CONTROVERT TO THE FACTS NARRATED BY THE LD.AR. 4.1 I HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFUL LY PERUSED THE MATERIAL AVAILABLE ON RECORD. AS STATED BY THE ASSESSEE, THE PERIOD OF LIMITATION FOR OPENING U/S.147 OF THE ACT , IN THE CASE OF THE ASSESSEE EXPIRES ON 31.03.2015 AS PER THE PROVISION S OF SECTION 149(1)(B) OF THE ACT. IT IS ALSO EVIDENT FROM THE PAPER BOOK PAGE NO.11, THAT THE ENVELOPE CONTAINING THE NOTICE U/S. 147 OF THE ACT, IS STAMPED ON 01.04.2015 BY THE SPEEDPOST AUTHORITIES OF THE INDIAN POSTAL DEPARTMENT. THEREFORE, THE DECISION OF THE HONBLE GUJARAT HIGH COURT CITED SUPRA SQUARELY APPLIES TO THE CASE OF THE ASSESSEE. 5 ITA NO.544/MDS/2017 RESPECTFULLY FOLLOWING THE DECISION OF THE GUJARAT HIGH COURT, I HEREBY QUASH THE RE-ASSESSMENT FRAMED U/S.143(3) R. W.S. 147 OF THE ACT, IN THE CASE OF THE ASSESSEE BECAUSE IT IS BARR ED BY LIMITATION AS PER THE PROVISIONS OF SECTION 149(1)(B) OF THE ACT. SINCE I HAVE QUASHED THE ASSESSMENT MADE BY THE LD.AO, I DO NOT FIND IT NECESSARY TO EXAMINE THE MERITS OF THE CASE WITH RE SPECT TO THE OTHER ISSUES RAISED IN THE APPEAL OF THE ASSESSEE. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED ON THE 24 TH AUGUST, 2017. SD/- ( . ) (A. MOHAN ALANKAMONY) / ACCOUNTANT MEMBER '# /CHENNAI, $% /DATED 24 TH AUGUST, 2017 RSR % '( )( /COPY TO: 1. /APPELLANT 2. /RESPONDENT 3. , ( )/CIT(A) 4. , /CIT 5. (-. / /DR 6. .0 /GF