DCIT, Bangalore V. M/s Divyasree Properties Pvt. Ltd., Bangalore

ITA 631/BANG/2012

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 2333 (ITAT-BANGALORE)
• Duration Of Justice: 6 year(s) 3 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-08-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 14-06-2017
• Assessment Year: 2003-2004
• Appeal Filed On: 07-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B VENKATESHWAR RAO
• Assessee Lawyers: A SHANKAR
• Keywords: Tax effect
• Section: 6

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : BANGALORE BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER ITA NO S . 6 30 & 631/ BANG/201 2 ASSESSMENT YEAR S : 2002 - 03 & 2003 - 04 THE ACIT, CENTRAL CIRCLE 2 (3), BANGALORE. VS. M/S. DIVYASREE PROPERTIES PVT. LTD., (FORMERLY M/S. PATHAPATHI FOUNDATIONS PVT. LTD.) DIVYASREE CHAMBERS, NO. 11 O SHAUGNESSY ROAD, BANGALORE 560 025. PAN: AAAC P8343C APPELLANT RESPONDENT APPELLANT BY : SHRI B. VENKATESHWAR RAO, CIT (DR) RESPONDENT BY : SHRI A. SHANKAR, ADVOCATE DATE OF HEARING : 26. 0 7 .2018 DATE OF PRONOUNCEMENT : 31. 0 8 .2018 O R D E R PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER BOTH THESE APPEALS ARE FILED BY THE REVENUE WHICH A RE DIRECTED AGAINST THE COMBINED ORDER OF LD. CIT(A)-VI, BANGALOREDATED 27. 02.2012 FOR ASSESSMENT YEARS 2002-03 & 2003-04. 2. THE GROUNDS RAISED BY THE REVENUE FOR ASSESSMENT YEAR 2002-03 IN ITA NO. 630/BANG/2012 ARE AS UNDER. 1. THE ORDER OF LEARNED CIT(A) IS OPPOSED TO LAW, E QUITY, WEIGHT OF EVIDENCE ON RECORD, FACTS AND CIRCUMSTANCES OF THE CASE. 2. THE LD CIT (A) ERRED LEGALLY IN ANNULLING THE SE ARCH ASSESSMENTS WHERE INCOME INCLUDING CONCEALED INCOME OF THE ASSE SSEE WAS BROUGHT TO TAX AS PER THE PROVISIONS OF IT ACT. 3. THE LD CIT (A) FAILED TO RECOGNIZE THAT THE VALI DITY OF ASSESSMENTS IS LEGALLY NOT CONNECTED WITH THE ISSUE OF WARRANT WHICH WAS ISSUED IN JOINT NAMES. ITA NOS. 630 & 631/BANG/2012 PAGE 2 OF 3 4. THE LD CIT(A) FAILED TO APPRECIATE THAT THE ISSU E OF WARRANT IN FORM NO.45 IS PRESCRIBED BY IT RULES AND IT IS ONLY A PROCEDURAL REQUIREMENT FOR CONDUCT OF SEARCH AND THAT THE PROV ISIONS OF IT ACT PREVAIL OVER THE IT RULES. 5. THE LD CIT(A) OVERLOOKED THE LEGALLY SIGNIFICANT FACT THAT THE IT LAW DOES NOT INSIST ON ISSUE OF SEPARATE WARRANTS F OR EACH PERSON INDIVIDUALLY AND THE FINDINGS OF THE CIT(A) IS NOT IN ACCORDANCE WITH THE LEGISLATIVE INTENT. 6. THE APPELLANT CRAVES FOR CONFIRMATION OF THE ASS ESSMENT ORDER IN VIEW OF THE PROPOSED AMENDMENT BY INSERTION OF SECT ION 292CC OF THE IT ACT. 7. THE APPELLANT CRAVES TO ADD ALTER SUBSTITUTE, MO DIFY AND DELETE ANY OR ALL THE GROUNDS OF APPEAL URGED ABOVE. 3. SIMILARLY, THE GROUNDS RAISED BY THE REVENUE FOR ASSESSMENT YEAR 2003-04 IN ITA NO. 631/BANG/2012 ARE AS UNDER. 1. THE ORDER OF LEARNED CIT(A) IS OPPOSED TO LAW, E QUITY, WEIGHT OF EVIDENCE ON RECORD, FACTS AND CIRCUMSTANCES OF THE CASE. 2. THE LD CIT (A) ERRED LEGALLY IN ANNULLING THE SE ARCH ASSESSMENTS WHERE INCOME INCLUDING CONCEALED INCOME OF THE ASSE SSEE WAS BROUGHT TO TAX AS PER THE PROVISIONS OF IT ACT. 3. THE LD CIT (A) FAILED TO RECOGNIZE THAT THE VALI DITY OF ASSESSMENTS IS LEGALLY NOT CONNECTED WITH THE ISSUE OF WARRANT WHICH WAS ISSUED IN JOINT NAMES. 4. THE LD CIT(A) FAILED TO APPRECIATE THAT THE ISSU E OF WARRANT IN FORM NO.45 IS PRESCRIBED BY IT RULES AND IT IS ONLY A PROCEDURAL REQUIREMENT FOR CONDUCT OF SEARCH AND THAT THE PROV ISIONS OF IT ACT PREVAIL OVER THE IT RULES. 5. THE LD CIT(A) OVERLOOKED THE LEGALLY SIGNIFICANT FACT THAT THE IT LAW DOES NOT INSIST ON ISSUE OF SEPARATE WARRANTS F OR EACH PERSON INDIVIDUALLY AND THE FINDINGS OF THE CIT(A) IS NOT IN ACCORDANCE WITH THE LEGISLATIVE INTENT. 6. THE APPELLANT CRAVES FOR CONFIRMATION OF THE ASS ESSMENT ORDER IN VIEW OF THE PROPOSED AMENDMENT BY INSERTION OF SECT ION 292CC OF THE IT ACT. 7. THE APPELLANT CRAVES TO ADD ALTER SUBSTITUTE, MO DIFY AND DELETE ANY OR ALL THE GROUNDS OF APPEAL URGED ABOVE. ITA NOS. 630 & 631/BANG/2012 PAGE 3 OF 3 4. AT THE VERY OUTSET, IT WAS SUBMITTED BY THE LEAR NED AR OF THE ASSESSEE THAT IN BOTH THESE APPEALS, THE TAX EFFECT IS BELOW RS. 20 LACS PER APPEAL AND THEREFORE, AS PER THE RECENT CBDT INSTRUCTIONS AS P ER CIRCULAR NO. 3/2018 DATED 11.07.2018, BOTH THESE APPEALS OF THE REVENUE ARE N OT MAINTAINABLE. LEARNED DR OF THE REVENUE HAD NOTHING TO SAY. 5. WE HAVE CONSIDERED THE SUBMISSIONS OF THE LEARNE D AR OF THE ASSESSEE AND WE ALSO FIND THAT IN THESE TWO APPEALS, THE TAX EFF ECT IS BELOW RS. 20 LACS PER APPEAL AND THEREFORE, AS PER THE RECENT CBDT INSTRU CTIONS AS PER CIRCULAR NO. 3/2018 DATED 11.07.2018, BOTH THESE APPEALS OF THE REVENUE ARE NOT MAINTAINABLE. ACCORDINGLY, THE SAME ARE DISMISSED BECAUSE OF LOW TAX EFFECT. 6. IN THE RESULT, BOTH THE APPEALS OF THE REVENUE A RE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE DA TE MENTIONED ON THE CAPTION PAGE. SD/- SD/- (SUNIL KUMAR YADAV) (ARUN KUMAR GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE, DATED, THE 31 ST AUGUST, 2018. /MS/ COPY TO: 1. APPELLANT 4. CIT(A) 2. RESPONDENT 5. DR, ITAT, BANGALORE 3. CIT 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.