Krishan Kumar Somani, Kanpur V. Dy. Commissioner of Income Tax-1, Kanpur

ITA 646/LKW/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 4850 (ITAT-LUCKNOW)
• Duration Of Justice: 2 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-01-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 13-10-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Unexplained expenditure

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.646/LKW/2015 ASSESSMENT YEAR 2007-08 THE DY. COMM. OF I. TAX-I, 16/69, AYAKAR BHAWAN, CIVIL LINES, KANPUR VS KRISHAN KUMAR SOMANI 51/27, SOMANI BHAWAN, NAYA GANJ, KANPUR PAN AHIPS 9087 Q (RESPONDENT) (APPELLANT) SHRI B.P. YADAV, COST ACCOUNTANT APPELLANT BY SHRI AMIT NIGAM, DR RESPONDENT BY 04/11/2015 DATE OF HEARING 01/01/2016 DATE OF PRONOUNCEMENT O R D E R PER A. K. GARODIA, A.M. THIS IS AN ASSESSEES APPEAL DIRECTED AGAINST THE O RDER OF LD. CIT (A)-I, KANPUR DATED 03.07.2015 FOR THE AY 2007-08. 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER: 1. THE ADDITION OF A SUM OF RS.3,70,000/- TOWAR DS ALLEGED LOW HOUSE HOLD WITHDRAWALS AS MADE BY LD. ASSESSING OFFICER AND AS SUSTAINED BY LD. COMMISSIONER OF INC OME TAX (APPEALS) DESERVES TO BE VACATED UNDER LAW IN T HE FACTS AND CIRCUMSTANCES OF THE CASE SINCE THERE IS NO MATERIAL ON RECORD TO PROVE ANY EXPENDITURE OVER AN D ABOVE THE AMOUNT OF WITHDRAWALS PUT ON RECORDS BEFO RE THE AUTHORITIES BELOW. 2 2. IN ANY CASE AND WITHOUT PREJUDICE, LD. COMMIS SIONER OF INCOME TAX (APPEALS) HAS FAILED TO APPRECIATE THAT THE AFORESAID ADDITION OF RS.3,70,000/- IS ARBITRARY AN D IN ANY CASE EXCESSIVE TOO. 3. IT WAS SUBMITTED BY THE LD. AR OF THE ASSESSEE THAT THE ESTIMATION OF THE HOUSEHOLD EXPENSES BY THE ASSESSING OFFICER AT RS.4 0,000/- PER MONTH IS HIGHLY EXCESSIVE AND THEREFORE, IT SHOULD BE MADE REASONAB LE. 4. LD. DR OF THE REVENUE SUPPORTED THE ORDERS OF AU THORITIES BELOW. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIN D THAT IT IS NOTED BY THE ASSESSING OFFICER IN PARA 4 OF THE ASSESSMENT ORDER THAT THE ASSESSEE AND HIS WIFE HAS WITHDRAWN TOTAL SUM OF RS.5.35 LAKH FOR HOUSEHO LD EXPENSES AND OUT OF THIS, ONLY RS.1.10 LAKH REMAINED WITH THE ASSESSEE FOR TH E PURPOSE OF EXPENSES OF TRAVELLING, CLOTHING, KITCHEN, MAINTENANCE OF HOUSE , PAYMENT OF ELECTRICITY AND TELEPHONE BILLS ETC. THE ASSESSING OFFICER ESTIMATE D THE TOTAL EXPENSES OF RS.40,000/- PER MONTH AND TOTAL RS.4.80 LAKH FOR WH OLE YEAR. AFTER DEDUCTING RS.1.10 LAKH, HE MADE THE ADDITION OF RS.3.70 LAKH. APART FROM THIS, THE ASSESSING OFFICER HAD ALSO MADE AN ADDITION OF RS.5.75 LAKH O N ACCOUNT OF UNEXPLAINED EXPENDITURE IN RESPECT OF EDUCATION OF HIS SON IN S .P. JAIN INSTITUTE OF MANAGEMENT & RESEARCH, MUMBAI. IT IS NOTED BY THE LEARNED CIT (A) IN HIS ORDER THAT AN AMOUNT OF RS.5.50 LAKH WAS INCURRED ON ACCOUNT OF F EES OF S.P. JAIN INSTITUTE OF MANAGEMENT & RESEARCH, MUMBAI AS HAS BEEN CONFIRMED BY THAT INSTITUTE ALSO. HE HAS GIVEN A FINDING THAT THE ASSESSEE HAS EXPLAINED THE SOURCE OF THIS EXPENSE OF RS. 5.50 LACS AND HE DELETED THIS ADDITION OF RS. 5 .75 LACS. HE FURTHER NOTED THAT IN ADDITION TO THE FEES OF THE INSTITUTE, SOME OTHER E XPENSES ARE ALSO REQUIRED TO BE INCURRED ON ACCOUNT OF DAY TO DAY EXPENSES, BOOKS A ND TRAVELLING BETWEEN MUMBAI AND KANPUR ETC. HE HELD THAT TOTAL EXPENSES OF RS. 4.80 LACS WILL BE ENOUGH FOR THE EXPENSES OF THE ASSESSEE, HIS WIFE AND IS SON AND T HEREFORE, HE CONFIRMED THE 3 ADDITION OF RS. 3.70 LACS. IN OUR CONSIDERED OPINIO N, RS.3.00 LAKH FOR THE WHOLE YEAR ON ACCOUNT OF HOUSEHOLD EXPENSES OF THE ASSESS EE AND HIS WIFE AND ALSO FOR HIS SON INCLUDING HIS TRAVELLING EXPENSES BETWEEN M UMBAI TO KANPUR IS REASONABLE. HENCE, WE UPHOLD THE ADDITION OF RS.1.90 LAKH BEING RS.3.00 LAKH LESS RS. 1.10 LAKH AND DELETE THE BALANCE ADDITION OF RS. 1.80 LA CS. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/- SD/- (SUNIL KUMAR YADAV) (A. K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBE R DATED: 01/01/2016 AKS COPY OF THE ORDER FORWARDED TO : 1.THE APPELLANT 2.THE RESPONDENT. 3.CONCERNED CIT 4.THE CIT(A) 5.D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR