Suraj Mandal, New Delhi V. ACIT, New Delhi

ITA 6158/DEL/2013

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 4180 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 10 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 11-04-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 18-11-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KAUSHLENDRA TIWARI
• Assessee Lawyers: ASHOK SEKHRI
• Section: 143(3); 142(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH G : NEW DELHI) BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO. 6158/DEL/2013 ASSESSMENT YEAR: 2008-09 SURAJ MANDAL, VS. ACIT, CENTRAL CIRCLE-7, B-26, SHALIMAR APARTMENT, NEW DELHI MASJID MOTH, NEW DELHI (PAN: BMZPM1527L) (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. ASHOK SEKHRI, ADV. REVENUE BY : SH. KAUSHLENDRA TIWARI, SR. D R ORDER PER H.S. SIDHU, JM THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINS T THE ORDER DATED 11.9.2013 OF THE LD. COMMISSIONER OF INCOME T AX (APPEALS)- VI, NEW DELHI RELEVANT TO ASSESSMENT YEAR 2008-09. 2. THE GROUNDS RAISED IN THE APPEAL READ AS UNDER:- 1. ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE A S WELL AS IN LAW, THE LD. CIT(A)- VI HAS ERRED IN PAR TLY DISALLOWING THE APPEAL OF THE APPELLANT. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE LD. CIT(A)-VI HAS ERRED IN NOT CONSIDERING THE REASONS AND CONTENTIONS MENTIONED IN THE GROUNDS OF APPEAL AND SUBSEQUENT WRITTEN SUBMISSIONS FILED BEF ORE HIM BY NOT APPRECIATING THE FACT THAT THE APPELLANT BEING AN EX-MP AND EX-MLA, MOST OF HIS HOUSEHOLD EXPENSES ARE FREE SINCE HE IS ELIGIBLE FOR THE SAME. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE LD. CIT(A)-VI HAS ERRED IN NOT CONSIDERING THE FACT THAT MOST OF THE TIME THE APPELLANT RESIDES AT HIS NATIVE PLACE, I.E., A SMALL VILLAGE IN THE STATE OF JHARKH AND IN HIS 2 OWNED BUILDING WHERE HIS HOUSEHOLD EXPENSES ARE MINIMUM. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE LD. CIT(A)-VI HAS ERRED IN NOT APPRECIATING THE FACT WHILE PASSING THE ORDER THAT THE APPELLANT HAS ONLY ONE DEPENDANT MEMBER, I.E., WIFE IN HIS FAMILY AND HENC E THE ENTIRE EXPENSES ARE NOT MORE THAN RS. 1,44,000/- AS HAS BEEN DECLARED IN HIS BALANCE SHEET. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE LD. CIT(A)-VI HAS ERRED IN HOLDING THAT AGRICUL TURAL LAND OR AGRICULTURAL INCOME HAVE NOT BEEN REFLECTED IN THE COMPUTATION PART OF RETURN OF INCOME OF THE APPELLA NT FOR THE ASSESSMENT YEAR 2008-09 FOR THE REASON THAT THE COMPUTATION PART OF RETURN OF INCOME DOES NOT PROVI DE FOR ANY COLUMN WHERE SUCH LAND CAN BE DISCLOSED AND MOREOVER IT IS SUBMITTED THAT IN THE RELEVANT ASSES SMENT YEAR, THE APPELLANT DID NOT EARN ANY AGRICULTURAL I NCOME AND HENCE THE SAME WAS SHOWN AS NIL IN THE COMPUTATION PART OF RETURN OF INCOME OF THE CAPTION ED ASSESSMENT YEAR. IT IS FURTHER SUBMITTED THAT AGRIC ULTURAL AND HAS BEEN DULY REFLECTED IN THE BALANCE SHEET AS AT 31.03.2008. 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE LD. CIT(A)-VI HAS ERRED IN HOLDING THAT THE DRA WINGS OF RS. 1,44,000/- SHOWN BY THE APPELLANT IN HIS BAL ANCE SHEET AS AT 31.03.2008 IS NOT REFLECTED IN ANY OF T HE BANK STATEMENTS AND THE LD. CIT(A) HAS NOT CONSIDER ED THE FACT THAT THE APPELLANT HAD ADEQUATE CASH IN HA ND OF RS. 3,87,000/- TO MEET HIS PERSONAL EXPENSES. EVEN AFTER MEETING HIS PERSONAL EXPENSES HE HAS BEEN LEFT WITH CASH OF RS. 3.87 LAKHS IN HIS HAND DURING THE RELEVANT P ERIOD. 7. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE LD. CIT(A)- VI HAS ERRED IN HOLDING THAT RS. 1,44,000/- IS A MEAGER SUM CONSIDERING THE STATUS O F THE APPELLANT BUT HAS IGNORED THE FACT THAT BY VIRTUE O F THE STATUS OF THE APPELLANT MOST OF HIS EXPENSES ARE EI THER FREE SINCE HE IS ELIGIBLE FOR SUCH PRIVILEGES AND B ENEFITS AS AN EX MP AND EX MLA OR ARE REIMBURSED FOR THE SAME REASON. HENCE THE DRAWINGS INCURRED BY HIM ARE ADEQUATE AND THE SAME HAVE BEEN DULY SHOWN IN THE BALANCE SHEET. 8. THAT THE APPELLANT CRAVES THE LEAVE OF THE HON'B LE TRIBUNAL TO ADD, ALTER OR AMEND ANY OF THE GROUNDS OF APPEAL AT THE TIME OF HEARING. 3 3. THE BRIEF FACTS OF THE CASE ARE THAT IN THIS CA SE NOTICE U/S. 142(1) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REF ERRED AS THE ACT) WAS ISSUED TO THE ASSESSE ON 28.10.2009 AS THE ASSE SSEE HAD NOT FURNISHED HIS RETURN OF INCOME. THE RETURN OF INCOM E WAS FILED ON 5.3.2010 DECLARING TOTAL INCOME OF RS. 2,30,024/-. THE CASE WAS SELECTED FOR SCRUTINY AND ACCORDINGLY, NOTICE U/S. 143(2) WAS ISSUED ON 19.7.2010. DETAILED QUESTIONNAIRE ALONGWITH NOT ICE U/S. 142(1) OF THE ACT WAS ISSUED ON 19.10.2010 FIXING THE DATE OF COMPLIANCE ON 28.10.2010. IN COMPLIANCE TO THE NOTICE, THE COUNS EL OF THE ASSESSEE ATTENDED THE HEARING ON 12.11.2010. HOWEV ER, NO REPLY TO THE QUESTIONNAIRE DATED 19.10.2010 WAS FURNISHED BY THE ASSESSEE. HE WAS REQUIRED TO FURNISH REPLY TO THE QUESTIONNAI RE ON 22.11.2010. HE WAS ALSO ASKED CATEGORICALLY TO FURNISH DETAILS OF HOUSE HOLD EXPENSES AND WAS REQUIRED TO SHOW CAUSE AS TO WHY HIS HOUSE HOLD EXPENSES SHOULD NOT BE TAKEN AT RS. 60,000/- PER MO NTH AS THERE WAS NO WITHDRAWAL FROM HIS BANK ACCOUNT FOR THIS PU RPOSE. NO REPLY TO THE QUESTIONNAIRE HAS BEEN FILED BY THE ASSESSEE . AO OBSERVED THAT AS THE ASSESEE HAS NOT FURNISHED ANY REPLY TO THE QUESTIONNAIRE, THE ASSESSMENT WAS COMPLETED ON THE BASIS OF MATERI AL AVAILABLE ON RECORD. THE HOUSE HOLD EXPENSES OF THE ASSESSEE ARE TAKEN AT RS. 7,20,000/- FOR THE FY 2007-08 @ RS. 60,000/- PER MO NTH. THIS AMOUNT WAS ADDED TO THE INCOME OF THE ASSESEE AS UN DISCLOSED EXPENSES ON HOUSE HOLD AND ACCORDINGLY, THE INCOME OF THE ASSESSEE WAS ASSESSED AT RS. 9,50,020/- VIDE ORDER DATED 02. 12.2010 PASSED 4 U/S. 143(3) OF THE ACT. AGAINST THE ASSESSMENT ORD ER DATED 02.12.2010, THE ASSESSEE APPEALED BEFORE THE LD. CI T(A), WHO VIDE HIS IMPUGNED ORDER DATED 11.9.2013 HAS PARTLY ALLOW ED THE APPEAL OF THE ASSESSEE. AGGRIEVED WITH THE IMPUGNED ORDER THE ASSESSEE IS IN APPEAL BEFORE US. 4. DURING THE HEARING, LD. A.R. OF THE ASSESSEE, HA S STATED THAT THE ASSESSEE BEING AN EX-MP AND EX-MLA AND MOST OF HIS HOUSEHOLD EXPENSES ARE FREE SINCE HE IS ELIGIBLE FOR THE SAME , WHICH REDUCED THE EXPENDITURE OF THE ASSESEE. HE FURTHER STATED T HAT MOST OF THE TIME THE ASSESSEE RESIDES AT HIS NATIVE PLACE, I.E. , A SMALL VILLAGE IN THE STATE OF JHARKHAND IN HIS OWNED BUILDING WHERE HIS HOUSEHOLD EXPENSES ARE MINIMUM. IT WAS FURTHER STATED THAT AS SESSEE HAS ONLY ONE DEPENDANT MEMBER, I.E., WIFE IN HIS FAMILY AND HENCE THE ENTIRE EXPENSES ARE NOT MORE THAN RS. 1,44,000/- AS HAS BE EN DECLARED IN HIS BALANCE SHEET. IT WAS FURTHER SUBMITTED THAT TH E AGRICULTURAL LAND OR AGRICULTURAL INCOME HAVE NOT BEEN REFLECTED IN T HE COMPUTATION PART OF RETURN OF INCOME OF THE ASSESSEE FOR THE AS SESSMENT YEAR 2008-09 FOR THE REASON THAT THE COMPUTATION PART OF RETURN OF INCOME DOES NOT PROVIDE FOR ANY COLUMN WHERE SUCH LAND CAN BE DISCLOSED AND MOREOVER IT IS SUBMITTED THAT IN THE RELEVANT A SSESSMENT YEAR, THE ASSESSEE DID NOT EARN ANY AGRICULTURAL INCOME A ND HENCE THE SAME WAS SHOWN AS NIL IN THE COMPUTATION PART OF RE TURN OF INCOME OF THE CAPTIONED ASSESSMENT YEAR. IT WAS FURTHER SU BMITTED THAT AGRICULTURAL LAND HAS BEEN DULY REFLECTED IN THE BA LANCE SHEET AS ON 5 31.03.2008. IT WAS FURTHER STATED THAT DRAWINGS OF RS. 1,44,000/- SHOWN BY THE ASSESSEE IN HIS BALANCE SHEET AS ON 31 .03.2008 IS NOT REFLECTED IN ANY OF THE BANK STATEMENTS AND LD. CIT (A) HAS NOT CONSIDERED THE FACT THAT THE ASSESSEE HAD ADEQUATE CASH IN HAND OF RS. 3,87,000/- TO MEET HIS PERSONAL EXPENSES. EVEN AFTER MEETING HIS PERSONAL EXPENSES HE HAS BEEN LEFT WITH CASH OF RS. 3.87 LAKHS IN HIS HAND DURING THE RELEVANT PERIOD. IN VIEW OF THE AB OVE, HE STATED THAT RS. 1,44,000/- IS A MEAGER SUM CONSIDERING THE STAT US OF THE ASSESSEE BUT HAS IGNORED THE FACT THAT BY VIRTUE OF THE STATUS OF THE ASSESSEE MOST OF HIS EXPENSES ARE EITHER FREE SINCE HE IS ELIGIBLE FOR SUCH PRIVILEGES AND BENEFITS AS AN EX MP AND EX MLA OR ARE REIMBURSED FOR THE SAME REASON. HENCE THE DRAWINGS INCURRED BY HIM ARE ADEQUATE AND THE SAME HAVE BEEN DULY SHOWN IN T HE BALANCE SHEET. IT WAS THE FURTHER CONTENTION THAT NO CONTRA RY EVIDENCE HAS BEEN BROUGHT ON RECORD BY THE REVENUE TO THE AVER MENTS MADE BY THE ASSESSEE TO SUPPORT HIS PLEA. IN VIEW OF THE AB OVE, HE REQUESTED THAT THE ADDITION IN DISPUTE MAY BE DELET ED. 5. ON THE CONTRARY, LD. DR OPPOSED THE REQUEST OF T HE LD. COUNSEL OF THE ASSESSEE AND RELIED UPON THE ORDERS OF THE A UTHORITIES BELOW. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE R ECORDS, ESPECIALLY THE ORDERS OF THE AUTHORITIES BELOW. WE NOTE THAT ASSESSEE BEING AN EX-MP AND EX-MLA AND MOST OF HIS HOUSEHOLD EXPENSES ARE FREE SINCE HE IS ELIGIBLE FOR THE SAME, WHICH REDU CED THE EXPENDITURE 6 OF THE ASSESEE. WE FURTHER FIND CONSIDERABLE COGENC Y IN THE SUBMISSIONS OF THE LD. COUNSEL OF THE ASSESSEE THAT MOST OF THE TIME THE ASSESSEE RESIDES AT HIS NATIVE PLACE, I.E., A S MALL VILLAGE IN THE STATE OF JHARKHAND IN HIS OWNED BUILDING WHERE HIS HOUSEHOLD EXPENSES ARE MINIMUM. WE FURTHER NOTE THAT ASSESSE E HAS ONLY ONE DEPENDANT MEMBER, I.E., WIFE IN HIS FAMILY AND HENC E THE ENTIRE EXPENSES ARE NOT MORE THAN RS. 1,44,000/- AS HAS BE EN DECLARED IN HIS BALANCE SHEET. IT IS AN ADMITTED FACT THAT THE AGRICULTURAL LAND OR AGRICULTURAL INCOME HAVE NOT BEEN REFLECTED IN THE COMPUTATION PART OF RETURN OF INCOME OF THE ASSESSEE FOR THE ASSESSM ENT YEAR 2008-09 FOR THE REASON THAT THE COMPUTATION PART OF RETURN OF INCOME DOES NOT PROVIDE FOR ANY COLUMN WHERE SUCH LAND CAN BE DISCL OSED AND MOREOVER THE RELEVANT ASSESSMENT YEAR, THE ASSESSEE DID NOT EARN ANY AGRICULTURAL INCOME AND HENCE THE SAME WAS SHOW N AS NIL IN THE COMPUTATION PART OF RETURN OF INCOME OF THE CAPTION ED ASSESSMENT YEAR. WE FURTHER NOTE THAT THE AGRICULTURAL LAND HA S BEEN DULY REFLECTED IN THE BALANCE SHEET AS ON 31.03.2008 A ND DRAWINGS OF RS. 1,44,000/- SHOWN BY THE ASSESSEE IN HIS BALANCE SHEET AS ON 31.03.2008 IS NOT REFLECTED IN ANY OF THE BANK STAT EMENTS AND LD. CIT(A) HAS NOT CONSIDERED THE FACT THAT THE ASSESSE E HAD ADEQUATE CASH IN HAND OF RS. 3,87,000/- TO MEET HIS PERSONAL EXPENSES. EVEN AFTER MEETING HIS PERSONAL EXPENSES HE HAS BEEN LEF T WITH CASH OF RS. 3.87 LAKHS IN HIS HAND DURING THE RELEVANT PERI OD. KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE 7 CONSIDERED VIEW THAT RS. 1,44,000/- IS A MEAGER SUM CONSIDERING THE STATUS OF THE ASSESSEE BUT IT WAS IGNORED BY THE LO WER AUTHORITIES THAT BY VIRTUE OF THE STATUS OF THE ASSESSEE MOST O F HIS EXPENSES ARE EITHER FREE SINCE HE IS ELIGIBLE FOR SUCH PRIVILEGE S AND BENEFITS AS AN EX MP AND EX MLA OR ARE REIMBURSED FOR THE SAME REA SON. HENCE THE DRAWINGS INCURRED BY HIM ARE ADEQUATE AND THE SAME HAVE BEEN DULY SHOWN IN THE BALANCE SHEET. WE FURTHER FIND THAT NO CONTRARY EVIDENCE HAS BEEN BROUGHT ON RECORD BY THE REVENU E TO THE AVERMENTS MADE BY THE ASSESSEE. IN VIEW OF THE ABOV E, THE ADDITION IN DISPUTE IS DELETED AND GROUND RAISED BY THE AS SESSEE IS ALLOWED. 7. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED ORDER PRONOUNCED IN OPEN COURT ON THIS 04-10-2017. SD/- SD/- (PRASHANT MAHARISHI) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 04-10-2017 SR BHATANGAR COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A), NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.