SMT. GUMAN KHANDELWAL, Jaipur V. ACIT, Jaipur

ITA 579/JPR/2011

• Counselvise Citation: 57923114 RSA 2011
• Duration Of Justice: 2 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-08-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2004-2005
• Appeal Filed On: 10-06-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: K L MOOLCHANDAN I; R K KHUNTETA
• Keywords: Depreciation; Block assessment
• Section: 153A; 2

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH A JAIPUR (BEFORE SHRI R.K.GUPTA AND SHRI N.L.KALRA) ITA NO.579/ JP/2011 ASSESSMENT YEAR 2004-05 PAN: ADRPK 6455 F SMT GUMAN KHANDELWAL VS. THE ACIT A-2, RANA PRATAP NAGAR CENTRAL CIRCLE- 1 JHOTWARA, JAIPUR JAIPUR (APPELLANT ) (RESPONDENT) ASSESSEE BY : SHRI K.L. MOOLCHANDANI & SHRI R .K. KHUNTETA DEPARTMENT BY : SHRI SUNIL MATHUR DATE OF HEARING: 02-08-2011 DATE OF PRONOUNCEMENT: 26-08-2011 ORDER PER N.L. KALRA, AM:- THE ASSESSEE HAS FILED APPEAL AGAINST THE ORDER OF THE LD. CIT(A), CENTRAL JAIPUR DATED 15-04-2011 FOR THE ASSESSMENT YEAR 2004-05. 2.1 THE FIRST GROUND OF THE ASSESSEE IS THAT THE LD . CIT(A) HAS ERRED IN CONFIRMING THE ADDITION AT 20% ON ACCOUNT OF TAXI R UNNING EXPENSES AS AGAINST 33.33% MADE BY THE AO. 2 2.2 THE SECOND GROUND OF THE ASSESSEE IS THAT THE L D. CIT(A) HAS ERRED IN NOT ALLOWING DEPRECIATION BEYOND THE EXTENT OF INCOME ESTIMATED BEFORE ALLOWING DEPRECIATION 2.3 WE HAVE HEARD BOTH THE PARTIES. DURING THE YEAR UNDER REFERENCE, THE ASSESSEE WAS HAVING TWO TAXIES FOR ENTIRE YEAR, TWO TAXIES WERE FOR 124 DAYS AND 136 DAYS AND ONE TAXI WAS FOR 329 DAYS. THE PRE SENT ASSESSMENT HAS BEEN MADE U/S 153A OF THE ACT. THE ASSESSMENT U/S 1 53A IS DIFFERENT FROM THE BLOCK ASSESSMENT U/S 158BC OF THE ACT. THE BLOC K ASSESSMENT WAS BEING MADE FOR MAKING THE ASSESSMENT OF UNDISCLOSED INCOM E AS PER THE MATERIAL FOUND DURING THE COURSE OF SEARCH OR ANY MATERIAL W HICH IS CONNECTED WITH THE MATERIAL FOUND DURING THE COURSE OF SEARCH AND NOTICED AFTER THE SEARCH. THE BLOCK ASSESSMENT WAS SEPARATE AND DISTINCT FROM THE REGULAR ASSESSMENT. HOWEVER, THE ASSESSMENT U/S 153A IS TO BE MADE AND THE REGULAR ASSESSMENT IF ANY PENDING STANDS ABATED. HENCE, WHEN THE INCOM E IS BEING ASSESSED IN A REGULAR WAY THEN THE ASSESSEE IS ENTITLED FOR DEPRE CIATION. HENCE, THE DECISION OF JODHPUR TRIBUNAL IN THE CASE OF SUNCITY ALLOYS (P) LTD. VS. ACIT, CENTRAL CIRCLE- 1 IN ITA NOS.586 TO 588/JU/20 08 ON WHICH AO HAS PLACED RELIANCE IS NOT APPLICABLE IN THE INSTANT CA SE. LOOKING TO THE NUMBER OF TAXIES PLIED FOR WHOLE OF THE YEAR AND PLIED FOR PART OF THE YEAR, WE FEEL THAT IT WILL BE FAIR AND REASONABLE TO ESTIMATE THE INCOME FROM TAXIES AT 3 35,000/- AFTER ALLOWING DEPRECIATION AS AGAINST RET URNED LOSS OF RS. 2,96,444/- AFTER DEPRECIATION. 3.1 THE THIRD GROUND OF THE ASSESSEE IS THAT THE LD . CIT(A) HAS ERRED IN CONFIRMING THE ADDITION AT 20% ON ACCOUNT OF CONST RUCTION EXPENSES AT RS. 1,90,600/- AS AGAINST ADDITION OF RS. 3,17,666/-. 3.2 WE HAVE HEARD BOTH THE PARTIES. THE FACTS ARE S IMILAR TO THE FACTS AS CONSIDERED BY US WHILE DECIDING THE APPEAL FOR THE ASSESSMENT YEAR 2008-09. FOLLOWING OUR FINDINGS FOR THE ASSESSMENT YEAR 2008 -09, WE HOLD THAT NO DISALLOWANCE IS TO BE MADE BECAUSE THE ASSESSEE HAS NOT CLAIMED ANY EXPENDITURE AND THE EXPENDITURE INCURRED IF ANY HAS BEEN INCLUDED IN THE VALUATION OF THE CLOSING STOCK. THUS THE ADDITION O F RS. 1,90,600/- IS DELETED. 4.1 THE FOURTH GROUND OF APPEAL IS AGAINST DISALLOW ANCE OUT OF EXPENSES CLAIMED IN THE CONCERN M/S. SUNIL FURNITURE. 4.2 WE HAVE HEARD BOTH THE PARTIES. THE AO HAS DISA LLOWED EXPENSES TO THE EXTENT OF RS. 3,015/- WHILE THE LD. CIT(A) HAS CONFIRMED THE DISALLOWANCE TO RS. 1,809/-. THIS ISSUE HAS BEEN DE CIDED IN THE CSSE OF THE ASSESSEE IN THE SUBSEQUENT YEARS. WE HAVE ALREADY HELD THAT THE DISALLOWANCE AS CONFIRMED BY THE LD. CIT(A) IS EXCE SSIVE. THEREFORE, WE FEEL THAT IT WILL BE FAIR AND REASONABLE TO RESTRICT TH E DISALLOWANCE TO RS. 3,00/-. 4 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE PARTLY ALLOWED THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 26-08 -2011. SD/- SD/- (R.K. GUPTA) (N.L. KALRA) JUDICIAL MEMBER ACCOUNTANT MEMBER JAIPUR DATED; 26/08/2011 *MISHRA COPY FORWARDED TO :- 1. SMT GUMAN KHANDELWAL, JAIPUR 2. THE ACIT, CENTRAL CIRCLE- 1, JAIPUR 3. THE LD. CIT BY ORDER 4. THE LD. CIT(A) 5. THE LD.DR 6. THE GUARD FILE (ITA NO.579/JP /11) A.R, ITAT, JAIPUR 5 6