Deputy Commissioner of Income-tax, V. Shri Shivaji Bhagwanrao Jadhav, Pune

ITA 679/PUN/2015

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 7015 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 6 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-12-2017
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 21-11-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 13-05-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Deemed owner of house property; Search and seizure; Deemed dividend
• Section: 143(3); 153A

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE , . , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI D. KARUNAKAR A RAO, AM . / ITA NO.679/PUN/2015 / ASSESSMENT YEAR : 2007-08 DCIT, CENTRAL CIRCLE-2(1), PUNE . /APPELLANT VS. SHRI SHIVAJI BHAGWANRAO JADHAV, ROW HOUSE NO.79/80, HIMALI CO.OP HOUSING SOCIETY, ERANDWANE, PUNE 411 004 PAN : AAKPJ7226M . / RESPONDENT ASSESSEE BY : SHRI KISHOR PHADKE REVENUE BY : SHRI AJAY MODI, JCIT / DATE OF HEARING : 21.11.2017 / DATE OF PRONOUNCEMENT: 06.12.2017 / ORDER PER D. KARUNAKARA RAO, AM : THIS APPEAL IS FILED BY THE REVENUE AGAINST THE ORD ER OF CIT(A)-12, PUNE RELATING TO A.Y. 2007-08 2. BACKGROUND FACTS OF THE ASSESSEE IN THIS APPEAL INCLUDE THAT THE ASSESSEE IS AN INDIVIDUAL ENGAGED IN THE BUSINESS OF EXECUTI ON OF IRRIGATION CONTRACTS AND THE GENERATION OF ENERGY FROM WINDMILLS. SHRADDHA CONS TRUCTION COMPANY IS THE FLAGSHIP COMPANY OF THE SHRADDHA GROUP OF CASES. T HERE WAS SEARCH AND SEIZURE ACTION IN SHRADDHA GROUP OF CASES ON 08-09-2010. T HEREFORE, THE ASSESSMENT IN THIS CASE WAS COMPLETED U/S.153A R.W.S. 143(3) OF T HE ACT. 3. BRIEFLY STATED RELEVANT FACTS OF THE CASE INCLUD E THAT THE ASSESSEE FILED THE RETURN OF INCOME ON 29-07-2007 FOR THE A.Y. 2007-0 8 DECLARING TOTAL INCOME OF RS.26,62,860/-. AO COMPLETED THE ASSESSMENT U/S.14 3(3) OF THE ACT ON 30-12- 2009 DETERMINING THE TOTAL INCOME AT RS.1,20,11,195 /-. AO MADE VARIOUS ITA NO.679/PUN/2015 SHRI SHIVAJI B. JADHAV 2 ADDITIONS TOTALLING TO RS.1,20,11,195/- ON ACCOUNT S OF (1) INCOME FROM HOUSE PROPERTY RS.7,79,315/-; (2) DEEMED DIVIDEND RS. 73,85,253/-; (3) OPENING BALANCE ADJUSTMENT RS.9,84,248/-; (4) INTEREST ON LOAN GIVEN RS.13,67,091/-; AND (5) CASH DEPOSITED IN BANK RS.5,00,000/-. AG GRIEVED WITH THE SAID DECISIONS, THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A) AND THE SAME IS PENDING FOR ADJUDICATION. 4. MEANWHILE, CONSEQUENT TO SEARCH ACTION U/S.132 O N THE ASSESSEE AND IN RESPONSE TO NOTICE U/S.153A OF THE ACT, THE ASSESSE E FILED THE RETURN OF INCOME U/S.153A OF THE ACT DISCLOSING TOTAL INCOME OF RS.3 9,96,660/- AS AGAINST RS.26,62,860/- ORIGINALLY RETURNED BY THE ASSESSEE U/S.139 OF THE ACT. AT THE END OF THE ASSESSMENT PROCEEDINGS U/S.153A OF THE ACT, THE AO DETERMINED THE INCOME AT RS.1,20,11,195/-. THIS ASSESSED INCOME I S SAME AS THAT OF THE ASSESSED INCOME AS PER THE ASSESSMENT ORDER DATED 3 0-12-2009 PASSED U/S.143(3) OF THE ACT. AGGRIEVED WITH THE SAID ORDE R OF THE AO U/S.153A OF THE ACT, THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A). 5. DURING THE FIRST APPELLATE PROCEEDINGS BEFORE TH E CIT(A), ASSESSEE SUBMITTED THAT IN DETERMINING THE ASSESSED INCOME O F RS.1,20,11,195/- U/S.153A OF THE ACT, AO, IN EFFECT, AFFIRMED THE ADDITIONS M ADE BY THE AO IN THE REGULAR ASSESSMENT U/S.143(3) OF THE ACT. THEREFORE, IT IS A CASE OF DOUBLE ADDITIONS AND THE SAME NEED TO BE DELETED. ON CONSIDERING THE SA ME AND ON FINDING THAT THESE ADDITIONS DO NOT ENJOY THE SUPPORT OF THE INCRIMINA TING MATERIAL, THE CIT(A) GAVE A FINDING STATING THAT THE ADDITIONS NEED TO BE DELET ED. FURTHER, HE HELD THAT THE GROUNDS OF THE ASSESSEE BECOME INFRUCTUOUS. THEREF ORE, CIT(A) DID NOT FIND NEED OF ADJUDICATING THE GROUNDS RAISED BY THE ASSESSEE IN THIS APPEAL. CONTENTS OF PARA NO.2.6.3 TO 2.6.5 ARE RELEVANT AND THE SAME AR E EXTRACTED AS UNDER : 2.6.3 I HAVE CONSIDERED THE FACTS AND ARGUMENTS O F THE APPELLANT. I HAVE ALREADY HELD IN MY FINDINGS ON GROUND OF APPEAL 1 A ND 2 OF AY 2005-06 THAT THE ADDITIONS MADE IN ABSENCE OF THE SEIZED MATERIAL CANNOT BE SUSTAINED. IN THIS CASE, THE LEARNED AO HAS MADE IN THE SAME ADDITIONS , WHICH WERE MADE BY HIM IN THE ORIGINAL ASSESSMENT ORDER. ITA NO.679/PUN/2015 SHRI SHIVAJI B. JADHAV 3 2.6.4. THERE CANNOT BE TWO ASSESSMENT ORDERS MAKING THE SAME ADDITIONS FOR THE SAME ASSESSMENT YEAR. ACCORDINGLY, FOLLOWING O N MY DECISION OF A.Y. 2005- 06, I DELETE THE ADDITIONS MADE BY THE LEARNED AO OF RS.7,79,315 ON ACCOUNT OF RENTAL INCOME ON DEEMED LET OUT PROPERTIES, ADDITIO N OF RS.73,85,253 AS DEEMED DIVIDEND, ADDITION OF RS. 9,84,248 FOR OPENING BALA NCE ADJUSTMENT, ADDITION OF RS.13,67,091 ON ACCOUNT OF INTEREST ON LOAN GIVEN B Y THE ASSESSEE AND ADDITION OF RS.5,00,000 FOR CASH DEPOSITED IN THE BANK. 2.6.5 AS I HAVE DELETED ALL THE ADDITIONS, THE APPE LLANTS OTHER GROUNDS OF APPEAL HAVE BECOME INFRUCTUOUS. ACCORDINGLY, I DO NOT DISCUSS AND ADJUDICATE THE SAME. 6. AGGRIEVED WITH THE ORDER OF CIT(A) THE REVENUE I S IN APPEAL NOW. BEFORE US, LD. DR FOR THE REVENUE RELIED ON THE ORDER OF T HE AO AND PLEADED FOR REVERSING THE ORDER OF THE CIT(A). 7. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE APPEAL BEFORE THE FIRST APPELLATE AUTHORITY IN CONNECTION WITH THE SAID ADD ITIONS MADE IN THE REGULAR ASSESSMENT U/S.143(3) OF THE ACT, IS PENDING FOR AD JUDICATION. FURTHER, LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT HE HAS NO O BJECTION IF APPEAL OF THE REVENUE IS ALLOWED CONFIRMING THE DECISIONS OF THE AO. 8. WE HAVE HEARD BOTH THE PARTIES ON THIS ISSUE AND PERUSED THE ORDERS OF THE AO/CIT(A) AS WELL AS THE PAPER BOOK FILED BY THE AS SESSEE. THERE IS NO DISPUTE ON THE FACT THAT THE ADDITIONS NARRATED IN PARA 22 ABOVE OF THIS ORDER WERE ACTUALLY MADE BY THE AO IN THE REGULAR ASSESSMENT U/S.143(3) OF THE ACT. FURTHER, WE FIND THAT THE AO ADOPTED THE ASSESSED INCOME IN THE PRES ENT ASSESSMENT MADE U/S.153A OF THE ACT. THE SAME IS EVIDENT IN THE SA ID ORDER OF THE AO, WHO ACCEPTED THE ASSESSED INCOME OF RS.1,20,11,195/- AS DETERMINED U/S.143(3) OF THE ACT. FURTHER, IN THE FIRST APPELLATE PROCEEDIN GS, WE FIND THE LD. CIT(A) GAVE A FINDING DELETING THE ADDITIONS ON ONE SIDE AND TREA TED THE GROUNDS AS INFRUCTUOUS AND REFUSED TO ADJUDICATE THE SAME ON THE OTHER. B Y INFERENCE, THE GROUNDS ARE DISMISSED AS INFRUCTUOUS. IN THE PROCESS, CIT(A) H ELD THAT THE ADDITIONS NEEDS TO BE DELETED AS THEY WERE MADE WITHOUT HAVING THE BA SIS OF THE ANY INCRIMINATING MATERIAL TO SUPPORT THE ADDITIONS IN THE NON-ABATED ASSESSMENT. THUS, THE CIT(A) ITA NO.679/PUN/2015 SHRI SHIVAJI B. JADHAV 4 ON ONE SIDE GAVE A FINDING IN FAVOUR OF DELETION ON ONE SIDE AND HE REFUSED TO ADJUDICATE THE GROUND ON THE OTHER SIDE. THE ABOVE EXTRACTED PARAS ARE RELEVANT. 9. WE FIND NO MERIT IN THE ORDER OF CIT(A) SINCE AO HAS NOT MADE ANY ADDITION IN THE ORDER PASSED U/S.143(3) R.W.S. 153A OF THE A CT. THE AO SIMPLY ADOPTED THE ASSESSED INCOME U/S.143(3) OF THE ACT. THERE IS TH US NO OCCASION TO CONSIDER THE ASPECT OF ABATEMENT OR NON-ABATEMENT OF PROCEEDINGS , IN THE PRESENT CASE. FURTHER THERE IS NO NEED TO LOOK INTO THE ASPECT OF INCRIMINATING DOCUMENTS OR NOT. THE ASSESSED INCOME IS TO BE ADOPTED AS SUCH. IF T HE ASSESSEE HAS ANY GRIEVANCE AGAINST THE SAID ADDITIONS, THEN THE SAME HAS TO BE PERUSED IN APPEAL AGAINST THE ORDER U/S.143(3) OF THE ACT, SEPARATELY . ACCORDINGLY, WE REVERSE THE ORDER OF CIT(A) AND RESTORE THE ORDER OF THE AO. T HE GROUNDS OF APPEAL RAISED BY REVENUE ARE THUS ALLOWED. 10. IN THE RESULT, APPEAL OF THE REVENUE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 06 TH DAY OF DECEMBER, 2017. SD/- SD/- (SUSHMA CHOWLA) (D.KARUNAKARA RAO) / JUDICIAL MEMBER / ACCOUNTANT MEMBER PUNE; DATED : 06 TH DECEMBER, 2017. / COPY OF THE ORDER FORWARDED TO : / BY ORDER, //TRUE COPY// //TRUE COPY// SENIOR PRIVAT E SECRETARY , / ITAT, PUNE 1. / THE APPELLANT 2. / THE RESPONDENT 3. THE CIT(A)-12, PUNE 4. CIT-12, PUNE 5. , , A BENCH PUNE; 6. / GUARD FILE.