Nimmagadda Prasad, Secunderabad, Hyderabad V. DCIT, Circle-17(2), Hyderabad, Hyderabad

ITA 685/HYD/2017

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 1691 (ITAT-HYDERABAD)
• Duration Of Justice: 4 year(s) 2 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB-B
• Next Hearing Date: 21-06-2021
• Assessment Year: 2012-2013
• Appeal Filed On: 17-04-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: K A SAI PRASAD
• Keywords: Gift; Cost of acquisition
• Section: 143(3); 54F; 54EC; 64; 13

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD (THROUGH VIRTUAL HEARING) BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ITA NO. 684 & 685/HYD/2017 A.Y. 2009 - 10 & 2012 - 13 NIMMAGADDA PRASAD, SECUNDERABAD. PAN: ABKPN 3078 N VS. DCIT, CIRCLE - 3(3), HYDERABAD. (APPELLANT) (RESPONDENT) ASSESSEE BY SHRI K.A. SAI PRASAD REVENUE BY SHRI ROHIT MUJUMDAR DATE OF HEARING: 21/06/2021 DATE OF PRONOUNCEMENT: 30 /06/2021 ORDER PER A. MOHAN ALANKAMONY , A.M: TH ESE APPEAL S ARE FILED BY THE ASSESSEE AGAINST THE ORDER S OF THE LD. CIT(A) - 5, HYDERABAD IN APPEAL NO S . 0544 & 0113 /2014 - 15 , 2015 - 16 /CIT(A) - 5, DATED 30/01/2017 PASSED U/S. 143(3) AND 143(3) R.W.S 263 OF THE ACT FOR THE A.Y. 2009 - 10 AND 2012 - 13. 2. THE ASSESSEE HAS RAISED FOUR GROUNDS IN HIS APPEAL FOR THE A.Y. 2009 - 10 AND THEY ARE EXTRACTED HEREIN BELOW FOR REFERENCE: - 2 1. THE ORDER D ATED 30/01/2017 PASSED BY THE LD. CIT(A) - 5 IS NOT JUSTIFIED AND INCORRECT BOTH ON FACTS AND IN LAW. 2. THE LD. CIT(A) IS NOT JUSTIFIED IN UPHOLDING THE DISALLOWANCE OF RS. 11,68,000/ - FROM COST OF ACQUISITION MADE BY THE A.O. BEING COST OF IMPROVEMENTS OF RESIDENTIAL FLAT AND WHICH WERE TOWARDS IMPROVEMENT OF THE FLAT AND CAPITAL NATURE. 3. THE LD. CIT(A) OUGHT TO HAVE APPRECIATED THE FACT THAT THE EXPENSES WERE INCURRED ON A NEW FLAT AND THEY WERE NOT TOWARDS MAINTENANCE (INCLUDING THE CORPUS TO THE OWNERS ASSOCIATION) AND THAT THE FIXTURES AND FITTINGS WERE INSTALLED TO MAKE THE FLAT HABITABLE. 4. THE APPELLANT CRAVES LEAVE TO ADD, SUPPLEMENT, MODIFY, AND DELETE ANY OF THE ABOVE GROUND DURING THE COURSE OF APPEAL. 3. THE ASSESSEE HAS RAISED SIX GROUNDS IN HIS APPEAL FOR THE A.Y. 2012 - 13 AND THEY ARE EXTRACTED HEREIN BELOW FOR REFERENCE: - 1. THE ORDER DATED 30/01/2017 PASSED BY THE LD. CIT(A) - 5 IS NOT JUSTIFIED AND INCORRECT BOTH ON FACTS AND IN LAW. 2. THE LD. CIT(A) IS NOT JUSTIFIED IN UPHOLDIN G THE DISALLOWANCE OF THE DEDUCTION FOR AMOUNTS OF AED 60,000 PAID FOR ELECTRICITY, WATER AND UTILITIES FROM THE ALV OF AED 1,40,000 RECEIVED ON RESIDENTIAL FLAT AT DUBAI AS THERE IS DIVERSION BY OVERRIDING TITLE FOR PAYMENT TOWARDS UTILITIES. 3. THE LD. C IT(A) IS NOT JUSTIFIED IN UPHOLDING DISALLOWANCE OF RS. 94,51,906/ - U/S. 54F SINCE THE APPELLANT HAS PAID THAT AMOUNT TO HIS BROTHER FOR THE PURPOSE OF CONSTRUCTION ON A PRINCIPAL - TO - PRINCIPAL BASIS. 4. THE LD. CIT(A) OUGHT TO HAVE UPHELD CLAIM FOR DEDUCTI ON U/S. 54EC AS THE APPELLANT HAS INVESTED IN BONDS WITHIN 6 MONTHS FROM DATE OF RECEIPT OF THE PART CONSIDERATION AS PER PROVISIONS THEREOF. 5. THE LD. CIT(A) OUGHT TO HAVE UPHELD CLAIM FOR DEDUCTION OF INTEREST ON OD FROM THE INTEREST EARNED ON THE FD BY THE APPELLANTS SPOUSE AND CLUBBED IN THE HANDS OF THE APPELLANT U/S. 64 AS ONLY THE NET INCOMES ARISING FROM THE GIFTS HAVE TO BE CLUBBED. 6. THE APPELLANT CRAVES LEAVE TO ADD, SUPPLEMENT, MODIFY AND DELETE ANY OF THE ABOVE GROUND DURING THE COURSE OF APPEAL. 3 4 . AT THE OUTSET, THE LD. AR SUBMITTED BEFORE US STATING THAT THE LD. CIT (A) HAS PASSED EX - PARTE ORDERS FOR BOTH THE A.Y.S 2009 - 10 AND 2012 - 13 WITHOUT PROVIDING PROPER OPPORTUNITY TO THE ASSESSEE OF BEING HEARD. IT WAS THEREFORE PLEADED THAT TH E MATTER MAY BE REMITTED BACK TO THE FILE OF THE LD CIT (A) IN ORDER TO PROVIDE ONE MORE OPPORTUNITY TO THE ASSESSEE OF BEING HEARD . LD. DR, ON THE OTHER HAND, VEHEMENTLY OPPOSED TO THE SUBMISSIONS OF THE LD. AR AND ARGUED THAT SUFFICIENT OPPORTUNITIES HAD BEEN PROVIDED TO THE ASSESSEE IN BOTH THE AYS UNDER CONSIDERATION HOWEVER, ON THE GIVEN DATES OF HEARING, NEITHER THE ASSESSEE NOR H IS REPRESENTATIVE APPEARED BEFORE THE LD. CIT (A). THEREFORE THE LD. CIT (A) HAD NO OTHER OPTION BUT TO PASS EX - PARTE ORDERS BASED ON THE MATERIALS AVAILABLE ON RECORD. HENCE, IT WAS PLEADED THAT THE ORDERS PASSED BY THE LD. CIT(A) DO NOT CALL FOR ANY INT ERFERENCE. 5 . WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY PERUSED THE MATERIALS ON RECORD. ON EXAMINING THE FACTS OF THE CASE S , WE FIND MERIT IN THE SUBMISSIONS OF THE LD. DR. IT IS APPARENT FROM THE LD. CIT(A)S ORDERS THAT FOR BOTH THE AYS 2009 - 10 AND 2012 - 13, THE LD. CIT (A) HAD POSTED THE CASE S ON SEVERAL OCCASIONS. HOWEVER, NONE APPEARED ON BEHALF OF THE ASSESSEE BEFORE THE CIT(A) ON THE DATES OF HEARING. THEREFORE, THE LD. CIT (A) WAS LEFT WITH NO OTHER OPTION EXCEPT TO ADJUDICATE THE APPEA L S EX - PARTE. IN THIS SITUATION, WE DO NOT FIND MUCH 4 STRENGTH IN THE ARGUMENTS ADVANCED BY THE LD. AR. HOWEVER, CONSIDERING THE PRAYER OF THE LD. AR AS WELL AS THE ISSUES IN VOLVED IN THE APPEALS , IN THE INTEREST OF JUSTICE, WE HEREBY REMIT THE MATTER BACK TO THE FILE OF LD. CIT (A) IN ORDER TO CONSIDER BOTH THE APPEAL S AFRESH ON MERITS BY PROVIDING ONE MORE OPPORTUNITY TO THE ASSESSEE OF BEING HEARD. AT THE SAME BREATH, WE ALSO HEREBY CAUTION THE ASSESSEE TO PROMPTLY CO - OPERATE BEFORE THE LD. CIT (A) IN TH E PROCEEDINGS FAILING WHICH THE LD. CIT (A) SHALL BE AT LIBERTY TO PASS APPROPRIATE ORDER S IN ACCORDANCE WITH LAW AND MERITS BASED ON THE MATERIALS ON THE RECORD. IT IS ORDERED ACCORDINGLY. 6 . IN THE RESULT, TWO APPEAL S FILED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES AS INDICATED HEREINABOVE. PRONOUNCED IN THE OPEN COURT ON THE 30 TH JUNE, 2021. SD/ - SD/ - (P. MADHAVI DEVI) ( A. MOHAN ALANKAMONY ) JUDICIAL MEMBER ACCOUNTANT MEMBER HYDERABAD, DATED: 30 TH JUNE , 2021. OKK COPY TO: - 1) SRI PRSAD NIMMAGADA C/O. CH. PARTHASARATHY & CO., 1 - 1 - 298/2/B/3, 1 ST FLOOR, SOWBHAGYA AVENUE, ST. NO.1, ASHOKNAGAR, HYDERABAD 500 020. 2) THE DCIT, CIRCLE - 3(3), SIGNATURE TOWERS, OPP. BOTANICAL GARDENS, KONDAPUR, HYDERABAD. 3) THE CIT(A) - 5, HYDERABAD. 4) THE PR. CIT - 5, HYDERABAD. 5) THE DR, ITAT, HYDERABAD 6) GUARD FILE