DCIT, New Delhi V. Shri J.B. Roy, Lucknow

ITA 629/DEL/2013

• Counselvise Citation: 62920114 RSA 2013
• Duration Of Justice: 6 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-08-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 17-07-2013
• Assessment Year: 2009-2010
• Appeal Filed On: 01-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RENUKA JAIN GUPTA
• Assessee Lawyers: D R RANJAN; J J MNEHROTRA
• Keywords: Salary income; Revised return

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH D NEW DELHI) BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI T.S. KAPOOR, ACCOUNTANT MEMBER I.T.A. NO.629/DEL/2013 ASSESSMENT YEAR : 2009-10 DCIT, SHRI J.B. ROY, CIRCLE-6, 1-KAPOORTHALA COMPLEX, NEW DELHI. V. ALIGANJ, LUCKNOW. (APPELLANT) (RESPONDENT) PAN /GIR/NO. PAN /GIR/NO. PAN /GIR/NO. PAN /GIR/NO.ACQPR ACQPR ACQPR ACQPR- -- -6786 6786 6786 6786- -- -CF CFCF CF APPELLANT BY : SMT. RENUKA JAIN GUPTA, SR. DR RESPONDENT BY : SHRI J.J. MNEHROTRA, FCA & SHRI D.R. RANJAN, ADVOCATE. ORDER PER TS KAPOOR, AM: THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORD ER OF LD CIT(A) DATED 20.11.2012. THE GROUNDS RAISED BY THE R EVENUE ARE AS UNDER:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD CIT(A) HAS ERRED IN:- 1. THE ORDER OF LD CIT(A) IS NOT CORRECT IN LAW AND ON FACTS. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD CIT( A) HAS ERRED IN ALLOWING THE APPEAL OF THE ASSESSEE IN RESPEC T OF TAXING THE SALARY INCOME THE HEAD INCOME FROM SALARY AS AG AINST CHARGED TO TAX UNDER THE HEAD INCOME FROM OTHER SOU RCES BY THE ASSESSING OFFICER U/S 2(24)(IV) OF THE INCOME TAX AC T, 1961. ITA NO629/DEL/2013 2 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD CIT( A) HAS ERRED IN ALLOWING THE APPEAL OF THE ASSESSEE REGARDING DEDUCTION U/S 10(13A) OF THE IT ACT IN RESPECT OF RENT PAID FOR HIS RESIDENTIAL PROPERTY. 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD CIT( A) HAS ERRED IN DELETING THE ADDITION OF ` .1,21,423/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF PERQUISITE VALUE OF GUNN ER PROVIDED TO THE ASSESSEE. 5. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD CIT( A) HAS ERRED IN DELETING THE ADDITION OF ` .3,00,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF ESTIMATING PERQUISITE VAL UE OF CAR AND CHAUFFER PROVIDED TO THE ASSESSEE. 6. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD CIT( A) HAS ERRED IN DELETING THE ADDITION OF ` . 3,26,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF ESTIMATING THE VALUE OF THREE SERVANTS @ ` .1,08,690/- PER PERSON AMOUNTING TO ` .3,26,070/- TO THE INCOME OF THE ASSESSEE. 7. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD CIT( A) HAS ERRED IN DELETING THE ADDITION OF ` .10,000/- ON ACCOUNT OF GAS AND WATER CHARGES. 8. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD CIT( A) HAS ERRED IN DELETING THE ADDITION OF ` .2,02,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF CONCESSIONAL RENTAL OF TH E PREMISES AND FURNITURE. 9. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD CIT( A) HAS ERRED IN DELETING THE ADDITION OF ` .3,94,933/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF CONCESSIONAL RENTAL OF T HE PREMISES AND FURNITURE. ITA NO629/DEL/2013 3 10. THE APPELLANT CRAVES LEAVE TO ADD, AMEND ANY ALL OF THE GROUNDS OF APPEAL BEFORE OR DURING THE COURSE OF HEAR ING OF THE APPEAL. 3. THE APPEAL WAS EARLIER HEARD ON 18.7.2013. THE LD AR AT THE TIME OF HEARING HAD SUBMITTED THAT THE GROUNDS OF APP EALS RAISED BY THE REVENUE WERE COVERED IN FAVOUR OF ASSESSEE. HOWEVER , WHILE GOING THROUGH THE FILE, IT WAS OBSERVED THAT TWO OF THE GRO UNDS WERE NOT EXACTLY COVERED. THEREFORE, THE CASE WAS RE-FIXED FOR CLARIFICATION. AT THE TIME OF HEARING, THE LD AR TOOK US TO THE FACTS O F THE CASE AND INVITED OUR ATTENTION TO THE CHART FILED ON EARLIER OCCASIONS AND ALSO FILED A FRESH PAPER BOOK CONTAINING 58 PAGES WHICH PR IMARILY CONTAINED ORDERS OF ITAT IN ASSESSEES OWN CASE IN EARLIER YEAR AND ALSO CONTAINED THE COPY OF COMPUTATION OF INCOME FOR THE PRESENT YEAR. INVITING OUR ATTENTION TO PAGES 3 TO 5 WHERE A COPY OF ITAT ORDER FOR ASSESSMENT YEAR 2008-09 WAS PLACED. IT WAS ARGUED THAT IN THE EARLIER YEARS, THE MATTER OF RELATIONSHIP OF EMPLOYER-EMPLOYE E WAS CONSIDERED AND THE ISSUE WAS DECIDED IN FAVOUR OF THE ASSESSEE AND ST ANDARD DEDUCTION U/S 16(1) WAS ALSO ALLOWED. IT WAS FURTHER AR GUED THAT SINCE EMPLOYER-EMPLOYEE RELATIONSHIP WAS HELD TO BE THERE, THEREFORE THE CLAIM OF THE ASSESSEE U/S 10(13A) WAS ALSO ALLOWABLE AND I N THIS RESPECT OUR ATTENTION WAS INVITED TO PAPER BOOK PAGE 12 WHERE ITAT ORDER FOR ASSESSMENT YEAR 2007-08 WAS PLACED IN WHICH OR DER BOTH THE CLAIMS U/S 16(1) AND UNDER SECTION 10(13A) WERE HELD T O BE IN FAVOUR OF THE ASSESSEE. THEREFORE, IN VIEW OF THE ABOVE, IT WAS A RGUED THAT GROUND NO.1,2, 3 WERE SQUARELY COVERED IN FAVOUR OF THE ASSESSEE. 4. AS REGARDS GROUND NO.4 & 5 RELATING TO ADDITION OF ` .4,21,423/-, THE LD AR INVITED OUR ATTENTION TO PARA 10 OF ITAT ORDER FOR ASSESSMENT YEAR 2008-09 IN WHICH THE ISSUE OF VALUATION OF PERQU ISITE OF CAR AND ITA NO629/DEL/2013 4 CHAUFFER WERE DEALT. THE LD AR ARGUED THAT SINCE FAC TS AND CIRCUMSTANCES REMAINED THE SAME, THE GROUND NO.5 WAS COVERED IN FAVOUR OF ASSESSEE. IN RESPECT OF GROUND NOP.4, IT WAS SU BMITTED THAT THE ASSESSING OFFICER HAD MADE AN ADDITION OF ` .1,21,423/- AS THE PERQUISITE VALUE OF GUNNER PROVIDED TO THE ASSESSEE. THE LD AR SUBMITTED THAT IN THE ORIGINAL RETURN OF INCOME, THE ASSESSEE HAD INCLUDED THIS VALUE OF PERQUISITE IN HIS RETURN OF INC OME WHICH WAS LATER ON REVISED BY EXCLUDING THIS PERQUISITE VALUE AS THE GO VT. HAD WITHDRAWN ITS SECURITY PROVIDED TO THE ASSESSEE, THEREFOR E, THE AMOUNT OF ` .1,21,423/- WAS NOT PAID BY THE EMPLOYER TO THE GUNN ER OF ASSESSEE AS THE SAME WAS WITHDRAWN. 5. REGARDING GROUND NO.6 TO 8 REGARDING PERQUISITE V ALUE OF DOMESTIC SERVANTS, GAS, WATER CHARGES AND CONCESSION IN RE NT, OUR ATTENTION WAS INVITED TO PARA 8 OF ITAT ORDER IN RESP ECT OF ASSESSMENT YEAR 2008-09 WHEREIN THE SAME WERE DEALT IN AND WAS DECIDED IN FAVOUR OF THE ASSESSEE. REGARDING LAST GROUND OF FORE IGN TRAVEL AMOUNTING TO ` .3,94,933/- IT WAS ARGUED THAT EXPENSES WERE ADDED BACK IN THE INCOME OF FIRM AND TAXES WERE DULY PAID BY THE FIRM, THEREFORE, THERE WAS NO QUESTION OF ANY PERQUISITE VAL UE BEING ADDED TO THE INCOME OF THE ASSESSEE. OUR ATTENTION WAS INVITE D TO COMPUTATION OF INCOME OF THE FIRM PLACED AT PAPER B OOK PAGE 56 WHEREIN FOREIGN TRAVEL EXPENSES AND OTHER EXPENSES TO T HE TUNE OF 8,74,98,885/- WAS ADDED IN THE COMPUTATION OF INCOME OF FIRM. OUR ATTENTION WAS ALSO INVITED TO A JUDGMENT OF HON'BLE DELHI HIGH COURT IN THE CASE OF CIT V. RAJENDER KUMAR RAJGARIA WHEREIN U NDER SIMILAR CIRCUMSTANCES THE HON'BLE COURT HAS HELD THAT IF AN EX PENSE IS ADDED TO THE INCOME OF THE FIRM IT CANNOT BE TREATED AS A PERQUISITE IN THE HANDS OF THE PARTNERS AND IN VIEW OF THE HON'BLE COUR T JUDGMENT IT WAS ARGUED THAT FACTS ARE SQUARELY COVERED BY THE HON'BLE DELHI HIGH COURT JUDGMENT. THEREFORE, THE LD CIT(A) HAS RIGHTLY DELET ED THE ADDITION. ITA NO629/DEL/2013 5 6. THE LD DR, ON THE OTHER HAND, HEAVILY RELIED ON THE ASSESSMENT ORDER. HOWEVER, SHE SQUARELY AGREED TO THE FACTS THAT ISSUES WERE COVERED IN FAVOUR OF THE ASSESSEE. HOWEVER, SHE BROUGHT TO OUR NOTICE THAT THE DIFFERENCE BETWEEN THE ORIGINAL RETURN AND REVISED RETURN WAS MORE THAN ` .1,21,423/-./ THEREFORE, RE-CONCILATION BETWEEN THE ORIGINAL RETURN AND REVISED RETURN WAS NEEDED. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS OF BOTH THE PAR TIES AND HAVE GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE GROUND NO.1 TO 8 ARE COVERED IN FAVOUR OF THE ASSESSEE EXCEPT GROUND NO.4. IN I.T.A. NO. 4023/DE/2010 IN RESPECT OF ASSESSEE HIMSELF AND WHICH IS AGAIN COVERED BY THE ORDER OF ITAT IN ASSESSMEN T YEAR 2007- 08 IN I.T.A. NO.3420/DEL/2011. THE RELEVANT FINDING S ARE CONTAINED IN PARA 10 WHICH IS REPRODUCED BELOW:- 10. AFTER HEARING BOTH THE SIDES, WE FIND THAT THIS IS SUE IS COVERED BY THE AFORESAID ORDER OF THE ITAT IN ASSESSEES OWN CASE AND ITAT HAS HELD AS UNDER : 6.1 THE ADDITION IN THIS REGARD WERE MADE BY THE ASSESSING OFFICER ON ACCOUNT OF THE FOLLOWING :- A) CONCESSIONAL RENT B) DOMESTIC SERVANT C) GAS AND WATER CHARGES D) VALUE OF CHAUFFEUR DRIVEN CAR 6.2 AS REGARDS THE ISSUE OF CONCESSIONAL RENT, LD. COUNSE L OF THE ASSESSEE REFERRED TO THE AFORESAID TRIBUNALS ORDER IN ASSE SSEES OWN CASE WHEREIN VIDE PARA 6 FOLLOWING HAS BEEN HEL D:- ITA NO629/DEL/2013 6 APROPOS ADDITION ON ACCOUNT OF CONCESSIONAL RENT INC LUDING THE BENEFIT OF FURNITURE AND FIXTURE, ITAT IN A.Y. 99-00 HAS HELD THAT THESE PREMISES ARE NOT OWNED BY THE FIRM, THERE IS NO CHANGE IN THE FACTS WHICH IS AGREED BY BOTH PARTIES. FOLLOWING THE ORDER OF ITAT ORDER WE UPHOLD THE ORDER OF THE C.I.T.(A) IN DELETING THE ADDITIONS ON ACCOUNT OF CONCESSIONAL RENT INCLUDING BENEFITS ARISING OUT OF FURNITURE AND FIXTURE. THIS G ROUND OF REVENUE IS DISMISSED. 6.3 IN THE PRESENT YEAR ALSO BOTH THE COUNSELS FAIRLY AGREED THAT THE FACTS ARE SIMILAR. FOLLOWING THE ABOVE PRECEDENT , THIS GROUND OF REVENUE IS ALSO DISMISSED. THE ISSUE REGARDING DOMESTIC SERVANT, GAS AND WATER CHAR GES AND VALUE OF CHAUFFER DRIVEN CAR IS DEALT IN THE AFO RESAID DECISION IN PARA NOS.6.4 & 6.5, WHICH IS REPRODUCED BELOW :- 6.4 AS REGARDS THE ISSUES OF DOMESTIC SERVANT; GAS AND WATER CHARGES AND VALUE OF CHAUFFEUR DRIVEN CAR. ON THESE ISSUES ALSO THE LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT T HE SAME ISSUES WERE COVERED IN ASSESSEES FAVOUR VIDE PARA 5 O F THE ABOVE SAID TRIBUNAL ORDER. IN THE ABOVE TRIBUNA LS ORDER IT WAS HELD THAT :- APROPOS ISSUE ABOUT PERQUISITES U/S 29(V) IT IS ABUNDANTL Y CLEAR THAT IN RESPECT OF SECURITY GUARDS, SERVANTS AND GARDENE R THE EXPENSES HAVE BEEN PAID BY THE ASSESSEE FROM HIS CURRENT ACCOUNT MAINTAINED WITH THE FIRM. RESTS OF THE PERQ UISITES ITA NO.3420/DEL./2011 HAVE BEEN ADDED IN THE HANDS OF TH E FIRM, ITA NO629/DEL/2013 7 WHICH IS NOT DISPUTED, LD. D.R. HAS NOT CONTROVERTED T HE FACT. KEEPING THESE FACTS IN MIND AND ITAT ORDER, SINCE THE PERQUISITES HAVE EITHER BEEN ADDED IN THE HANDS OF THE FIRM AND SOME HAVE BEEN DEBITED TO ASSESSEES ACCOUNTS, WE UPHOLD THE ORDE R OF C.I.T.(A) ON THIS ISSUE. THIS GROUND OF THE REVENUE IS DISMISSED. 6.5 WE FIND THAT THAT FACTS AND CIRCUMSTANCES OF THE PRESENT CASE ARE IDENTICAL AND BOTH THE COUNSEL FAIRLY AGREED THAT THESE ISSUES ARE COVERED IN FAVOUR OF THE ASSESSEE. SINCE THE C .I.T.(A) HAS FOLLOWED THE AFORESAID TRIBUNALS ORDER, WE UPHOLD THE SAME AND DECIDE THE ISSUES IN FAVOUR OF THE ASSESSEE. RESPECTFULLY FOLLOWING THE SAME AND THE FACTS BEING ID ENTICAL, ADHERING TO THE DOCTRINE OF STAIRE DECISES, WE UPHOLD THE ORDER OF CIT (A) AND DISMISS GROUND NOS.3, 4 & 5 OF THE REVENUE S APPEAL. THE ISSUE OF H.R.A. U/S 10(13A) WAS DECIDED IN FAVOUR O F ASSESSEE IN ASSESSMENT YEAR 2007-08 IN I.T.A. NO.4023/DEL/2 010, THE RELEVANT FINDINGS ARE AS UNDER:- IN VIEW OF THIS SITUATION AND AFTER HEARING BOTH THE PARTIES, RESPECTFULLY FOLLOWING THE ABOVE DECISION OF COORDINA TE BENCH WE HOLD THAT THE INCOME IS ASSESSABLE AS SALARY AND DEDUCTIO N U/S 16(1) AND 10(13A) WERE RIGHTLY HELD ALLOWABLE. FROM THE ABOVE FINDINGS OF THE HON'BLE TRIBUNAL WE FIND THAT GROUND NO.1 TO 8 ARE COVERED IN FAVOUR OF ASSESSEE EXCEPT GRO UND NO.4. 8. AS REGARDS GROUND NO.4 REGARDING PERQUISITE VALUE O F GUNNER PROVIDED TO THE ASSESSEE, THE LD AR SUBMITTED THAT IN T HIS YEAR THE STATE GOVT. HAD WITHDRAWN SECURITY, THEREFORE, SUCH E XPENDITURE WAS NOT INCURRED BY THE FIRM AND THEREFORE THE SAME WAS N OT LIABLE TO BE ITA NO629/DEL/2013 8 ADDED AS PERQUISITE. IN THIS RESPECT WE OBSERVE THAT ASSES SING OFFICER DID NOT BRING ANY FACT HIGHLIGHTING THAT EMPLOYER H AD SPENT EXPENDITURE ON PROVIDING GUNNER TO THE ASSESSEE. THEREF ORE, WITHOUT ESTABLISHING THAT THE EXPENDITURE WAS ACTUALLY INCURRE D, THE INCLUSION IN THE PERQUISITE VALUE OF ASSESSEE WAS NOT JUSTIFIED. THE AR GUMENT LD DR THAT RECONCILIATION WAS NEEDED IN RESPECT OF ORIGINAL AND REVISED RETURN CANNOT ALTER THE FACTS THAT EXPENDITURE WAS NOT PAID BY EMPLOYER. THEREFORE, WE DISMISS GROUND NO.4 ALSO. 9. AS REGARDS GROUND NO. 9 REGARDING FOREIGN TRAVELIN G EXPENSES AMOUNTING TO ` .3,94,933/-. WE FIND FROM THE COMPUTATION OF INCOME THAT THE FIRM HAD ALREADY DISALLOWED THE EXPENDITURE OF FOREIGN TRAVEL AMOUNTING TO ` .91,04,063/- FORMING PART OF BREAK UP OF ` .87498885/- THEREFORE, THE EMPLOYER OF THE ASSESSEE HAD NOT CLAIMED ANY EXPENDITURE ON FOREIGN VISITS BY ASSESSEE AND RATHER HAD PAID TAXES ON FOREIGN VISITS MADE BY THE ASSESSEE. THEREFORE, THE EXPEN DITURE WHICH HAS NOT BEEN CLAIMED BY THE EMPLOYER OF THE ASSESSEE CAN NOT BE TREATED AS PERQUISITE IN THE HANDS OF ASSESSEE AS THAT WILL INVOLVE DOUBLE TAXATION OF THE SAME AMOUNT. THE HON'BLE DELH I HIGH COURT IN THE CASE LAW RELIED UPON BY LD AR HAS CLEARLY HELD TH AT ONCE THE FIRM HAD PAID TAXES ON SOME EXPENSES, THE SAME CANNOT BE ADD ED AS PERQUISITE IN THE HANDS OF THE PARTNERS. THEREFORE, RE SPECTFULLY FOLLOWING THE ABOVE JUDGMENT, WE DISMISS GROUND NO. 9 ALSO. IN VIEW OF THE ABOVE, WE DO NOT FIND ANY INFIRMITY IN THE ORDE R OF LD CIT(A). 10. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. 11. ORDER PRONOUNCED IN THE OPEN COURT ON 8TH DAY O F AUGUST, 2013. SD/- SD/- (RAJPAL YADAV ) (T.S. KAPOOR) JUDICIAL MEMBER ACCOUNTANT MEMBER DT. 8.8.2013. HMS ITA NO629/DEL/2013 9 COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT (A)-, NEW DELHI. 5. THE DR, ITAT, LOKNAYAK BHAWAN, KHAN MARKET, NEW DEL HI. TRUE COPY. BY ORDER (ITAT, NEW DELHI). DATE OF HEARING 5.8.2013 DATE OF DICTATION 5.8.2013 DATE OF TYPING 6.8.2013 DATE OF ORDER SIGNED BY BOTH THE MEMBERS & PRONOUNCEMENT. DATE OF ORDER UPLOADED ON NET & SENT TO THE BENCH CONCERNED.