DDIT (IT) - 1(1),kolkata, Kolkata V. Shri Ashim Kumar Sen, Kolkata

ITA 688/KOL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 100100 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 7 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-11-2015
• Appeal Filed By: Department
• Bench Allotted: C
• Assessment Year: 2008-2009
• Appeal Filed On: 01-04-2013
• Court: TRIBUNAL
• Department Lawyers: N O N E
• Assessee Lawyers: N O N E
• Keywords: Additional evidence; Cost of acquisition
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: KOL KATA [BEFORE SHRI MAHAVIR SINGH, JM & SHRI M. BALAGANES H, AM] I.T.A NO. 688/KOL/2013 ASSESSMENT YEAR: 2008-09 DEPUTY DIRECTOR OF INCOME-TAX, VS. SHRI ASHIM KU MAR SEN INTERNATIONAL TAXATION-1(1), KOL. (PAN: ASOPS867 2A) ( APPELLANT ) ( RESPONDENT ) DATE OF HEARING: 23.11.2015 DATE OF PRONOUNCEMENT: 23.11.2015 FOR THE APPELLANT: N O N E FOR THE RESPONDENT: N O N E ORDER PER SHRI MAHAVIR SINGH, JM: THIS APPEAL BY REVENUE IS ARISING OUT OF ORDER OF C IT(A)-VI, KOLKATA IN APPEAL NO.72/CIT(A)-VI/ADIT(IT)-1(1)/10-11/KOL DATED 28.01 .2013. ASSESSMENT WAS FRAMED BY DDIT(IT)-1(1), KOLKATA U/S. 143(3) OF THE INCOME -TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR AY 2008-09 VIDE ITS ORDER DATE D 24.12.2010. 2. WE HAVE HEARD THIS MATTER EX PARTE. NONE IS PRE SENT FOR REVENUE OR FROM THE ASSESSEE. REVENUE HAS FILED A PETITION FOR ADJOURNM ENT ASKING FOR ADJOURNMENT IN TWENTY MATTERS OUT OF TWENTY THREE TOTALLY FIXED IN THE CA USE LIST. THE REASON GIVEN BY REVENUE IN ITS PETITION DATED 23.11.2015 READS AS UNDER: I AM DIRECTED TO REQUEST TO THE HONBLE C BENCH , ITAT, KOLKATA THAT SHRI RAJAT KUMAR KUREEL, JCIT, SR. (DR) WILL NOT BE ABLE TO REPRESEN T THE ABOVE MENTIONED CASES SINCE HE IS GOING ON A VISIT TO BURDWAN FOR OFFICIAL WORK ON 23 RD NOVEMBER, 2015. ACCORDINGLY, I AM DIRECTED TO REQUEST THAT THE CAS E MAY KINDLY BE ADJOURNED FOR A LATER DATE AS PER THE CONVENIENCE OF THE HONBLE BENCH. WE FIND THAT THE REVENUE IS SEEKING ADJOURNMENT ON FRIVOLOUS GROUND AND THIS IS A REGULAR FEATURE. HENCE, WITHOUT GIVING ADJOURNMENT AND APP EAL IS PENDING SINCE 2013, WE PROCEEDED TO DECIDE IT EX PARTE. 3. THE FIRST ISSUE IN THIS APPEAL OF REVENUE IS AGA INST THE ORDER OF CIT(A) DELETING THE ADDITION MADE BY AO ON ACCOUNT OF COST OF ACQUISITI ON RELYING ON BANK STATEMENT. FOR THIS, REVENUE HAS RAISED FOLLOWING TWO GROUNDS: 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) FELL INTO ERROR IN ACCEPTING THE ASSESSEES CLAIM TOWARD S COST OF ACQUISITION AMOUNTING TO 2 ITA NO.688/K/2013 SHRI ASHIM KUMAR SEN, AY 2008-09 RS.33,94,980/- WITHOUT CONSIDERING THE FINDINGS OF THE ASSESSING OFFICER INCORPORATED IN THE REMAND REPORTS DATED 24.04.2012 AND 11.12.2012 RESPECTIVELY. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE AND IN LAW, THE LD. CIT(A) FELL INTO ERROR IN ACCEPTING THE ASSESSEES CLAIM TOWARD S COST OF ACQUISITION AMOUNTING TO RS.33,94,980/- BY RELYING UPON SOME BANK STATEMENT PURPORTEDLY PRODUCED BEFORE HIM BUT NEVER PRODUCED BEFORE THE ASSESSING OFFICER FOR VER IFICATION. 4. BRIEFLY STATED FACTS ARE THAT THE ASSESSEE, A NO N-RESIDENT INDIAN, IS REGULAR INCOME TAX ASSESSEE. DURING THE YEAR UNDER CONSIDE RATION, THE ASSESSEE PURCHASED LAND ADMEASURING ABOUT 6 COTTAHS TOGETHER WITH TWO AND PARTLY THREE STORIED BUILDING THEREON FOR A TOTAL CONSIDERATION OF RS.1.10 CR. VI DE CONVEYANCE DEED EXECUTED ON 22.04.2004. THE ASSESSEE BEFORE US CLAIMED THAT IT HAS CARRIED OUT RENOVATION EXPENSES IN THE TWO FOLLOWING FINANCIAL YEARS: F.Y. A.Y AMOUNT 2004-05 2005-06 RS. 26,82,380/- 2005-06 2006-07 RS. 7,12,600/- TOTAL : RS. 33,94,980/- THE ASSESSEE SOLD THE ABOVE SAID PROPERTY VIDE SALE DEED REGISTERED ON 20.11.2007 AND DECLARED LONG TERM CAPITAL GAIN AT RS.68,62,085 /- FROM SALE OF THIS PROPERTY VIDE TWO SALE AGREEMENTS FOR AN AMOUNT OF RS.2.50 CR. AS UNDER: I) LAND AND BUILDING SOLD TO SHRI SHARAD JHUNJHUNW ALA FOR CONSIDERATION OF RS.1,40,00,000/- BEING SITUATED AT 126A, KANKULIA R OAD, POLICE STATION LANE, KOLKATA. II) LAND SOLD TO HAPPY VALLEY PROPERTIES & INVESTME NTS PVT. LTD. FOR CONSIDERATION OF RS.1,10,00,000/- BEING SITUATED AT 126A/2, KANKU LIA ROAD, POLICE STATION LANE, KOLKATA. THE AO WHILE COMPUTING LONG TERM CAPITAL GAIN HAS N OT ALLOWED THE EXPENSES INCURRED ON REPAIRS AND RENOVATION AMOUNTING TO RS. 33,94,980/- AND RECOMPUTED THE CAPITAL GAIN AT RS.1,12,05,863/- AND ASSESSED THE S AME ACCORDINGLY. AGGRIEVED, ASSESSEE PREFERRED APPEAL BEFORE CIT(A), WHO AFTER TAKING ADDITIONAL EVIDENCE I.E. BILLS, VOUCHERS AND BALANCE SHEET FOR AYS 2005-06 A ND 2006-07 REFERRED THE SAME BACK TO THE FILE OF AO FOR REMAND REPORT AND AFTER GETTING THE SAME ALLOWED THE CLAIM OF REPAIRS AND RENOVATION EXPENSES AT RS.33,9 4,980/- ON ACCOUNT OF COST OF ACQUISITION WHILE COMPUTING LONG TERM CAPITAL GAIN BY OBSERVING IN PARA 7 AS UNDER: 7. THE ADDITIONAL EVIDENCE FILED BY THE APPELLAN T AFTER RECEIVING THE COMMENTS ON THE SAME OF THE ASSESSING OFFICER IS ADMITTED AS P ER RULE 46A OF INCOME TAX RULES, 1962. THEREFORE, LOOKING INTO THE FACTS AND CIRCUMSTANCES INCLUDING THAT EXPENDITURE HAS BEEN INCURRED AFTER WITHDRAWING CAS H FROM THE BANK; EXPENDITURE WAS INCURRED IN ASSESSMENT YEAR 2005-06 AND 2006-07 WHICH WAS DULY REFLECTED IN THE RESPECTIVE I. T. RETURNS; ALL PERSONS EXCEPT TW O ATTEND AND CONFIRMED THE RECEIPT OF MONEY AND RESPECTIVELY WORK CARRIED OUT BY THEM RELATING TO RENOVATION 3 ITA NO.688/K/2013 SHRI ASHIM KUMAR SEN, AY 2008-09 OF THE BUILDING ETC. THE COST OF RENOVATION IS ACCE PTED TO BE FULLY DISCLOSED, TRUE AND CORRECT; THEREFORE, THE APPELLANT IS ENTITLED F OR CLAIMING THE SAME AS DEDUCTION WHILE CALCULATING CAPITAL GAIN. THE APPELLANT HAS SHOWN THE EXPENDITURE IN BALANCE SHEET FILED ALONG WITH RETURNS SHOWING ENHA NCED VALUE OF PROPERTY. IN THE RESULT, THESE GROUNDS OF APPEAL ARE ALLOWED. AGGRIEVED, REVENUE IS IN SECOND APPEAL BEFORE TRIBU NAL. 5. WE HAVE GONE THROUGH THE ORDERS OF LOWER AUTHORI TIES. WE FIND THAT THE CIT(A) AFTER EXAMINING ALL THE DETAILS I.E. WITHDRA WAL FROM CASH BOOK, INCURRED EXPENDITURE ON ACCOUNT OF REPAIRS AND RENOVATION, W HICH IS REFLECTED IN THE BALANCE SHEETS FOR AYS. 2005-06 AND 2006-07 AND ALSO DISCLO SED THE SAME BEFORE THE AX AUTHORITIES. IN THOSE YEARS, THE TAX AUTHORITIES H AVE ACCEPTED THE DECLARATION OF EXPENDITURE WITH SOURCES. IN VIEW OF THIS FACT, WE FIND NO INFIRMITY IN THE ORDER OF CIT(A) AND THIS ISSUE OF REVENUES APPEAL IS DISMIS SED. 6. THE NEXT ISSUE OF THIS APPEAL OF REVENUE IS AGAI NST THE ORDER OF CIT(A) IN DELETING THE DISALLOWANCE OF UNPROVED LEGAL AND BRO KERAGE EXPENSES OF RS.3.30 LACS. FOR THIS, ASSESSEE HAS RAISED FOLLOWING GROUND NO.3 : 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) FELL INTO ERROR IN DELETING THE DISALLOWANCE OF RS. 3,30,000/- IN RESPECT OF UNPROVED LEGAL & BROKERAGE EXPENSES CLAIMED BY THE ASSESSEE IN THE COMPUTATION OF LONG TERM CAPITAL GAINS WITHOUT EVEN DISCUSSING THE SAME IN T HE APPELLATE ORDER. 7. AT THE OUTSET, WE HAVE GONE THROUGH THE ORDER OF CIT(A) AND FOUND THAT THIS ISSUE IS NOT ADJUDICATED BY THE CIT(A) AND AO HAS MADE A SPECIFIC ADDITION OF THE SAME AS UNDER: 4. ALSO ASSESSEES A/R WAS ASKED TO PRODUCE EVIDE NCES FOR LEGAL EXPENSES & BROKERAGE EXPENSE OF RS.3,30,000/- VIDE ORDER SHEET NOTING DT. 10.12.10 WHICH HE COULD NOT EXPLAIN WITH DOCUMENTARY EVIDENCES. THIS WAS NOT ALLOWED DEDUCTION WHILE COMPUTING LONG TERM CAPITAL GAIN. IN VIEW OF THE ABOVE, WE ARE OF THE CONSIDERED VIEW THAT LET THIS ISSUE BE READJUDICATED BY THE CIT(A) AND GIVE A SPECIFIC FINDING ON THE SAME. ACCORDING LY, THIS ISSUE OF REVENUES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 8. IN THE RESULT, THE APPEAL OF REVENUE IS PARTLY A LLOWED FOR STATISTICAL PURPOSES. 9. ORDER IS PRONOUNCED IN THE OPEN COURT. SD/- SD/- (M. BALAGANESH) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 23 RD NOVEMBER, 2015 JD. SR. P.S 4 ITA NO.688/K/2013 SHRI ASHIM KUMAR SEN, AY 2008-09 COPY OF THE ORDER FORWARDED TO: 1 . APPELLANT DDIT(IT)-1(1), KOLKATA. 2 RESPONDENT SHRI ASHIM KUMAR SEN, 126/1, KANKULIA ROAD, KOLKATA- 700019. 3 . THE CIT(A), KOLKATA 4. 5. CIT KOLKATA DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, ASSTT. REGISTRAR .