Aminosia Properties Development P.Ltd, Pune V. Dy. CIT Cir 2 [-3 ] Pune, Pune

ITA 624/PUN/2012

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9422 (ITAT-PUNE)
• Duration Of Justice: 5 year(s) 1 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-05-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 26-07-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 26-03-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: K G KAWADE
• Keywords: Unexplained expenditure; Search and seizure
• Section: 69C; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE ! ' $!%& ! ' BEFORE SHRI D.KARUNAKARA RAO, AM & SHRI VIKAS AWAST HY, JM / ITA NO. 624/PUN/2012 &( ) *) / ASSESSMENT YEAR : 2008-09 M/S.AMINOSIA PROPERTIES DEVELOPMENTS PVT LTD., ADITI COMMERCE CENTRE, 2406, 5 TH FLOOR, EAST STREET, CAMP, PUNE 411 001. PAN: AABCA5719J .. APPELLANT VS. DY.COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 2(3), PUNE. .. RESPONDENT ASSESSEE BY : SHRI NIKHIL PATHAK DEPARTMENT BY : SHRI K.G.KAWADE DATE OF HEARING : 16-05-2017 DATE OF PRONOUNCEMENT : 17-05-2017 + / ORDER PER D.KARAUNAKARA RAO, AM : THIS IS THE APPEAL BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX-CENTRAL, DATED 23/01/2012 FOR THE ASSESSMENT YEAR 2008-09. 2 ITA NO.624/PUN/2012, A.Y: 2008-09 OF M/S.AMINOSIA PROPERTIES DEVELOPMENTS PVT LTD. 2. ASSESSEE RAISED SEVEN(7) GROUNDS IN THE APPEAL. IN AD DITION, ASSESSEE ALSO FILED TWO(2) ADDITIONAL GROUNDS WIDE HIS LETTER D ATED 11/11/2014. BRINGING YOUR ATTENTION TO THE SAID GROUNDS , COUNSEL MENTIONED THAT THE ASSESSING OFFICER MADE ADDITION AMOUNTIN G TO RS.55,35,000/- IGNORING THE FACT THE SAID AMOUNT WAS ALREA DY OFFERED BY THE ASSESSEE IN THE RETURN OF INCOME. ASSESSEE ALSO AGGRIEVED REGA RDING THE REDUCTION OF WORK IN PROGRESS (WIP) TO THAT EXTENT. THE INVOKING OR APPLICABILITY OF THE PROVISIONS OF SECTION 69C OF THE ACT WAS ALSO QUESTIONED BY THE ASSESSEE. ASSESSEE OPINES THAT THE PROVISIONS O F SECTION 69B OF THE ACT ARE APPROPRIATE ONE. 3. DEVIATING FROM THE ABOVE ISSUES AND THE GROUNDS RAISE D ABOVE LD.COUNSEL FOR THE ASSESSEE, BEFORE US, SUBMITTED THAT TH ERE WAS SEARCH AND SEIZURE ACTION ON THE ASSESSEE U/S 132 OF THE ACT AND A CRUCIAL DOCUMENT, A COPY OF WHICH IS PLACED AT PAGE 26 OF THE PAP ER BOOK, WAS SEIZED. THIS DOCUMENT REFLECTS CERTAIN UNEXPLAINED EXPENDIT URE SUCH AS: BROKERAGE, CEMENTS, STEEL, CERTAIN WAGES AND CHARGES ETC ., THE EXPENDITURE ON THESE ACCOUNTS WORKED OUT TO 55,35,000/-. ASSESSEE OFFERED THE SAME WHILE FILING THE RETURN OF INCOME ABOUT WHICH THERE IS NO DISP UTE. HOWEVER, DURING THE ASSESSMENT PROCEEDINGS, ASSESSING OFFICER NOTICE D THAT THE SAID ACCOUNT WAS FOUND ADDED TO THE CLOSING WORK IN PROGRESS ACCOUNT. THUS, THE ASSESSING OFFICER CAME TO THE CONCLUSION THAT THE SAID INCREASE TO THE WIP ACCOUNT IS UNSUSTAINABLE. ASSESSING OFFICER IS OF THE VIE W THAT SAID INCREASE HAS LED TO THE CLAIM OF DEDUCTION OF RS.55,35,000/- IN THE NEXT ASSESSMENT YEAR. THEREFORE, CONSIDERING THE SAME AS A K IND OF DEDUCTION 3 ITA NO.624/PUN/2012, A.Y: 2008-09 OF M/S.AMINOSIA PROPERTIES DEVELOPMENTS PVT LTD. CLAIM BY THE ASSESSEE, ASSESSING OFFICER INVOKED THE PROVISIO NS OF THE PROVISO TO SECTION 69C OF ACT. THE SAID PROVISO READS AS UNDER:- WHERE IN ANY FINANCIAL YEAR AN ASSESSEE HAS INCURRED ANY EXPENDITURE AND HE OFFERS NO EXPLANATION ABOUT THE S OURCE OF SUCH EXPENDITURE OR PART THEREOF, OR THE EXPLANATION, IF A NY, OFFERED BY HIM IS NOT, IN THE OPINION OF THE ASSESSING OFFICER, SATISFA CTORY, THE AMOUNT COVERED BY SUCH EXPENDITURE OR PART THEREOF, AS THE CASE MAY BE, MAY BE DEEMED TO BE THE INCOME OF THE ASSESSEE FOR SUCH FINAN CIAL YEAR :] [ PROVIDED THAT, NOTWITHSTANDING ANYTHING CONTAINED IN ANY OTH ER PROVISION OF THIS ACT, SUCH UNEXPLAINED EXPENDITURE WHICH IS DEEMED TO BE THE INCOME OF THE ASSESSEE SHALL NOT E ALLOWED AS A DEDUCTION UNDER ANY HEAD OF INCOME.] 4. FROM THE ABOVE IT IS EVIDENT FROM THE PROVISO THAT T HE DEDUCTION CLAIMED IN RESPECT OF ANY UNEXPLAINED EXPENDITURE IS NOT AN ALLOWABLE ONE. THEREFORE, ASSESSING OFFICER DISALLOWED THE ADJUSTMENT MADE TO THE WIP ACCOUNT FOR THE YEAR UNDER CONSIDERATION. COMMISSIONER O F INCOME TAX (APPEALS) CONFIRMED THE SAME AND THEREFORE ASSESSEE IS IN APPEAL BEFORE US WITH THE ISSUES MENTIONED ABOVE. 5. BEFORE US, LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE SAID PROVISO IS NOT APPLICABLE TO THE YEAR UNDER CONSIDERATION I.E. ASSESSMENT YEAR 2008-09. BRINGING OUR ATTENTION TO THE FACTS RELEV ANT TO THE NEXT ASSESSMENT YEAR 2009-10, LD.AR MENTIONED THAT THE DEDU CTION WAS ACTUALLY CLAIMED IN THE SAID ASSESSMENT YEAR AND NOT IN T HE YEAR UNDER CONSIDERATION. THEREFORE, THE ADDITION, IF ANY SHOULD BE DON E IN THE LATER ASSESSMENT YEAR 2009-10. LD.COUNSEL PRAYED FOR THE DELE TION OF THE SAME IN THIS YEAR. HE IS OF THE OPINION THAT THE ADJUDICATION OF THE OTHER GROUNDS 4 ITA NO.624/PUN/2012, A.Y: 2008-09 OF M/S.AMINOSIA PROPERTIES DEVELOPMENTS PVT LTD. BECOMES AN ACADEMIC EXERCISE, IF THE SAID RELIEF IS GRANTED O N THE ABOVE SAID REASONING. 6. IN RESPONSE TO THE ABOVE LD.DEPARTMENTAL REPRESENT ATIVE FOR THE REVENUE RELIED HEAVY ON THE ORDER OF THE ASSESSING OFFICER UNDER COMMISSIONER OF INCOME TAX (APPEALS). 7. WE HEARD BOTH THE PARTIES ON THE SAID LIMITED ISSUE OF MAKING ADDITION OF RS.55,35,000/- IN THE YEAR UNDER CONSIDERATION W HEN NO DEDUCTION IS ACTUALLY CLAIMED BY THE ASSESSEE IN THE ASSE SSMENT YEAR 2008-09. IN THIS REGARD, WE PERUSE THE PROVISIONS OF SEC TION 69C ALONG WITH PROVISO. THE LANGUAGE OF THE SAID PROVISO WAS ALREADY EXTRACTED IN THE ABOVE PARAGRAPHS. THE SAME IS EXPLICITLY CLEAR THAT SUCH UNEXPLAINED EXPENDITURE SHALL NOT BE ALLOWED AS A DEDUCTIO N UNDER ANY HEAD OF INCOME. THE SAID EXPRESSION IS AMPLY CLEAR IN STATING THAT THE ASSESSEE SHOULD HAVE MADE A CLAIM OF DEDUCTION IN AN ASSE SSMENT YEAR FOR MAKING A DISALLOWANCE BY THE ASSESSING OFFICER. THEREFORE, MA KING A CLAIM OF DEDUCTION IS NECESSARY FOR ASSESSING OFFICER TO DENY THE DEDUCTION IF ANY. ON PERUSAL OF THE FACTS AND THE RECORDS WE HAVE NO CON FUSION IN OUR MIND THAT ASSESSEE HAS NOT CLAIMED ANY DEDUCTION IN THIS YEAR . THEREFORE, REQUIREMENT OF MAKING A DISALLOWANCE IS ON CALLED FOR IN THIS Y EAR. THEREFORE, ON THIS REASONING WE ARE OF THE OPINION THAT TH E ADDITION MADE BY THE ASSESSING OFFICER IS REQUIRED TO BE DELETED AND TH E SAME IS IN FAVOUR OF THE ASSESSEE. ACCORDINGLY, THE RELEVANT GROUNDS RAIS ED BY THE ASSESSEE ARE ALLOWED. 5 ITA NO.624/PUN/2012, A.Y: 2008-09 OF M/S.AMINOSIA PROPERTIES DEVELOPMENTS PVT LTD. CONSIDERING THE RELIEF GRANTED BY US IN THIS REGARD, WE ARE OF THE OPINION, ADJUDICATION OF THE OTHER ISSUES WILL BECOME AN ACAD EMIC EXERCISE HAS ARGUED BY THE LD.COUNSEL FOR THE ASSESSEE. THUS, THE OTHER GROUNDS AND ISSUES RAISED IN THE GROUNDS/ADDITIONAL GROUNDS ARE DISMISSED AS ACADEMIC AS DISCUSSED IN THE OPEN COURT. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED ON 17 TH DAY OF MAY, 2017. SD/- SD/- ,$!% /VIKAS AWASTHY) , /D.KARUNAKARA RAO) & !- JUDICIAL MEMBER !- ACCOUNTANT MEMBER / PUNE; / DATED : 17 TH MAY, 2017 S S G G R R +./&01$2$*0 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. ( ) / THE CIT(A)-CENTRAL, PUNE 4. / THE CIT-CENTRAL, PUNE 5. , ! , ' '#$ , / DR, ITAT, B BENCH, PUNE. 6. %& '( / GUARD FILE. ) * / BY ORDER, / / TRUE COPY / / *+ , / ASSISTANT REGISTRAR, ! , / ITAT, PUNE