Sitaram G Sarda , Bangalore V. The Income Tax Officer Ward-2(2)(3), Bangalore

ITA 689/BANG/2018

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 4620 (ITAT-BANGALORE)
• Duration Of Justice: 3 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-06-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 05-03-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: B R RAMESH
• Section: 148; 6; 2; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH A BEFORE S HRI N.V. VASUDEVAN , JUDICIAL MEMBER AND SHRI JASON P BOAZ , ACCOUNTANT MEMBER I.T . A. NO S . 689 TO 692 /BANG/20 18 (ASSESSMENT YEAR S : 20 08 - 09 & 2009 - 10 ) SHRI SITARAM G SARDA, PROP. PRATI SHTA INDUSTRIES, NO.272/A, BOMMASANDRA INDUSTRIAL AREA, ANEKAL TALUK, BANGALORE - 562 158 . . APPELLANT. VS. THE INCOME TAX OFFICER, WARD 9(3) [NOW WARD 2(2)(3)], BANGALORE. .. RESPONDENT. APPELLANT BY : S MT. SUMAN LUNKAR, CA R E SPONDENT BY : SHRI B.R. RAMESH, JCIT (D.R) DATE OF H EARING : 14.06.2018. DATE OF P RONOUNCEMENT : 15. 06 .201 8 . O R D E R PER SHRI JASON P BOAZ, A .M . : TH E S E APPEAL S BY THE ASSESSEE ARE DIRECTED AGAINST THE SEPARATE ORDER S OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) - 4 , BANGALORE ALL DT.31.10.2017 FOR THE ASSESSMENT YEAR S 20 08 - 09 & 2009 - 10 IN RESPECT OF 2 IT A NO S . 689 TO 692 /BANG/201 8 ORDERS ON VARIOUS QUANTUM ADDITIONS AND ALSO IN RESPECT OF THE UPHOLDING OF THE LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 (IN SHORT 'THE ACT ') FOR THE AFORESAID TWO ASSESSMENT YEARS. SINCE THESE APPEALS WERE HEARD TOGETHER AND ARE CONNECTED, WE DEEM IT APPROPRIATE TO DISPOSE THEM OFF BY WAY OF THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. ASSESSEE'S APPEALS IN ITA NOS.690 & 692/BANG/2018 FO R A.YS 2008 - 09 & 2009 - 10. 2. WE FIRST TAKE UP FOR CONSIDERATION AND ADJUDICATION THE ASSESSEE'S APPEALS DIRECTED AGAINST THE ORDERS OF THE CIT (APPEALS) 4, BANGALORE DT.31.10.2017 FOR ASSESSMENT YEARS 2008 - 09 & 2009 - 10 ON THE MERITS OF VARIOUS QUANT UM ADDITIONS / DISALLOWANCES MADE BY THE ASSESSING OFFICER AND UPHELD BY THE LEARNED CIT (APPEALS) BY DISMISSING THE ASSESSEE'S APPEALS FOR THESE TWO ASSESSMENT YEARS. 3. ALMOST IDENTICAL GROUNDS OF APPEAL HAVE BEEN RAISED BY THE ASSESSEE IN THESE A PPEALS FOR ASSESSMENT YEARS 2008 - 09 & 2009 - 10 (THE ONLY DIFFERENCE BEING IN THE FIGURE OF SALE CONSIDERATION). WE, THEREFORE, 3 IT A NO S . 689 TO 692 /BANG/201 8 EXTRACT HEREUNDER ONLY THE GROUNDS OF APPEAL PERTAINING TO ASSESSMENT YEAR 2008 - 09. 4 IT A NO S . 689 TO 692 /BANG/201 8 4. AT THE VERY OUTSET, THE LEAR NED AUTHORISED REPRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT THE ADDITIONS WERE MADE BY THE ASSESSING OFFICER IN THE ORDERS OF ASSESSMENT FOR BOTH ASSESSMENT YEARS 2008 - 09 & 2009 - 10 BASED ON THE STATEMENT OF SRI MUKESH CHOKSI, DIRECTOR OF M/S. 5 IT A NO S . 689 TO 692 /BANG/201 8 MAHASAGAR S ECURITIES PVT. LTD. THE LEARNED AUTHORISED REPRESENTATIVE FURTHER SUBMITTED THAT ON SIMILAR FACTS IN THE CASES OF SRI MUKESH KUMAR SOLANKI VS. ITO IN ITA NO.2168/BANG/2016 DT.17.3.2017 AND SRI SITARAM SARDA (HUF) IN ITA NO.2721/BANG/2017 DT.23.3.2018, THE TRIBUNAL HAS SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND RESTORED THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER FOR FRESH CONSIDERATION AND ADJUDICATION WITH THE SAME DIRECTION S AS WERE ISSUED BY THE HON'BLE KARNATAKA HIGH COURT IN ITS JUDGME NT RENDERED IN THE CASE OF CHANDRA DEVI KOTHARI IN WRIT PETITION NO.29370/2014 DT.2.2.2015. COPIES OF THE CITED ORDERS OF THE TRIBUNAL (SUPRA) WERE PLACED BEFORE THE BENCH. IT WAS PRAYED THAT IN THE CASE ON HAND ALSO THESE ISSUES BE RESTORED BACK TO THE FILE OF THE ASSESSING OFFICER FOR FRESH CONSIDERATION AND ADJUDICATION AS PER THE DIRECTIONS RENDERED BY THE HON'BLE KARNATAKA HIGH COURT IN THE CASE OF CHANDRA DEVI KOTHARI (SUPRA). 5. PER CONTRA, THE LEARNED DEPARTMENTAL REPRESENTATIVE VEHEMEN TLY SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. IT WAS CONTENDED THAT NO RELIEF CAN BE GRANTED TO THE ASSESSEE AS IN THE IMPUGNED ORDERS, THE LEARNED CIT (APPEALS) HAS OBSERVED THAT THE ASSESSING OFFICER HAS 6 IT A NO S . 689 TO 692 /BANG/201 8 RECORDED IN THE ORDERS OF ASSESSMENT THAT TH E ASSESSEE'S REPRESENTATIVE HAD FILED AN UNDERTAKING BEFORE THE ASSESSING OFFICER STATING THAT TAXES DUE ON THE SAID TRANSACTIONS WOULD BE DULY PAID AND NO FURTHER APPEALS WOULD BE PREFERRED AGAINST THE ORDERS OF ASSESSMENT FOR ASSESSMENT YEARS 2008 - 09 & 2 009 - 10. IT WAS ALSO OBSERVED BY THE LEARNED CIT (APPEALS) THAT THE ASSESSEE HAD NOT REFUTED THIS CATEGORIC OBSERVATION OF THE ASSESSING OFFICER IN THE ORDERS OF ASSESSMENT AND HAS REMAINED SILENT ON THE SAME. 6. IN REJOINDER, THE LEARNED AUTHORISED REPRESENTATIVE SUBMITTED THAT THE LEARNED CIT (APPEALS) S OBSERVATION IN PARA 10.3 OF THE IMPUGNED ORDERS THAT THE ASSESSEE HAD NOT REFUTED THE OBSERVATION OF THE ASSESSING OFFICER IN THE ORDER OF ASSESSMENT , THAT THE ADDITION BY ASSESSING OFFICER WAS MADE BASED ON THE UNDERTAKING OF THE ASSESSEE'S A.R. (SUPRA) , IS FACTUALLY INCORRECT. THE ASSESSEE HAD, IN FACT, DISPUTED THE SAME BEFORE THE LEARNED CIT (APPEALS) IN THE STATEMENT OF FACTS ; AT S.NO.12 THEREOF; FOR BOTH ASSESSMENT YEARS 2008 - 09 & 2009 - 10. I T IS CONTENDED THAT THE LEARNED DEPARTMENTAL REPRESENTATIVE S RELIANCE ON A FACTUALLY INCORRECT OBSERVATION BY THE LEARNED CIT (APPEALS) IS NOT 7 IT A NO S . 689 TO 692 /BANG/201 8 RELEVANT AND OUGHT TO BE IGNORED , S INCE THE ASSESSEE NEVER AUTHORIZED THE AR TO GIVE THE SAID UNDERTAKING. 7.1 WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED AND CAREFULLY CONSIDERED THE MATERIAL ON RECORD; INCLUDING THE JUDICIAL DECISIONS CITED. AT THE OUTSET, ON AN APPRECIATION OF THE DETAILS ON RECORD, WE FIND THAT THE OBSERVATIONS OF THE LEARNED CIT (APPEAL S), THAT THE ASSESSING OFFICER S NOTINGS THAT THE AR OF THE ASSESSEE HAD GIVEN UNDERTAKING TO PAY TAXES ON THE SAID TRANSACTION AND NOT TO FILE APPEALS AGAINST THE ORDERS OF ASSESSMENT AND REMAIN UN - REFUTED, TO BE FACTUALLY INCORRECT. THE ASSESSEE HAS R EFUTED THE ASSESSING OFFICER S OBSERVATION BEFORE THE LEARNED CIT (APPEALS). AS SUBMITTED BY THE LEARNED AUTHORISED REPRESENTATIVE , ON A PERUSAL OF THE STATEMENT OF FACTS FILED BEFORE THE LEARNED CIT (APPEALS), FOR BOTH ASSESSMENT YEARS, AT S.NO.12 THE REOF, THE ASSESSEE HAS REFUTED THE ASSESSING OFFICER S CLAIM AS FOLLOWS : - 12. IT IS MENTIONED IN THE ASSESSMENT ORDER THAT THE AR OF THE APPELLANT SUBMITTED THAT THE APPELLANT HAD AGREED TO THE ADDITIONS MADE. IT IS SUBMITTED THAT THE APPELLANT NEVER AUTHORIZED THE AR TO MAKE SUCH STATEMENT. THE LEARNED CIT (APPEALS) HAS BRUSHED ASIDE / IGNORED THIS FACT. 8 IT A NO S . 689 TO 692 /BANG/201 8 7.2 WE FIND FORCE IN THE SUBMISSIONS OF THE LEARNED AUTHORISED REPRESENTATIVE OF THE ASSESSEE BECAUSE NO DIFFERENCE IN FACTS COULD BE POINTE D OUT BY THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR REVENUE BETWEEN THE CITED DECISIONS OF THE TRIBUNAL (SUPRA) AND THE CASE ON HAND. AT PARAS 4 & 5 OF THE TRIBUNAL ORDER IN ITA NO.2721/BANG/2017 DT.23.3.2018 AT PARAS 4 & 5 THEREOF, FINDING RENDERED BY T HE TRIBUNAL IS EXTRACTED HEREUNDER : - 4. I HAVE CONSIDERED THE RIVAL SUBMISSIONS. I FIND FORCE IN THE SUBMISSIONS OF LD. AR OF ASSESSEE BECAUSE NO DIFFERENCE IN FACTS COULD BE POINTED OUT BY LD. DR OF REVENUE. I REPRODUCE PARAS 5 AND 6 OF THIS TRIBU NAL ORDER RENDERED IN THE CASE OF SHRI MUKESH KUMAR SOLANKI VS. ITO(SUPRA). THE SAME READS UNDER: - 5. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND FIRST OF ALL, I REPRODUCE PARA NO.8 OF THE JUDGMENT OF HON'BLE KARNATAKA HIGH COURT RENDERED IN THE CASE OF M/S CHANDRA DEVI KOTHARI (SUPRA) AND THIS IS AS UNDER: - 8. IN THE LIGHT OF THE FACTS AND CIRCUMSTANCES AS ADVERTED TO ABOVE, AND AS THE PETITIONER HAS BEEN DENIED AN OPPORTUNITY OF FAIR HEARING BY PROVIDING COPY OF THE STATEMENT AND RELATED DETAILS REGA RDING THE ALLEGED SHARE AMOUNT, I AM OF THE VIEW THAT THE MATTER REQUIRES TO BE RE - CONSIDERED BY THE RESPONDENT BY PROVIDING FAIR AND REASONABLE OPPORTUNITY OF HEARING TO THE PETITIONER AND BY FURNISHING THE DETAILS/COPY OF THE STATEMENT BASED ON WHICH THE IMPUGNED ASSESSMENT ORDER HAS BEEN PASSED.' 6. FROM THE ABOVE PARA FROM THE JUDGMENT OF HON'BLE KARNATAKA HIGH COURT, IT IS SEEN THAT MATTER WAS RESTORED BACK TO THE FILE OF THE AO FOR FRESH DECISION AFTER PROVIDING COPY OF THE STATEMENT OF SHRI MUKESH CHOKSI. AS PER THE FACTS NOTED BY THE HIGH COURT IN THE EARLIER PARAS OF JUDGMENT AND AS PER THE FACTS OF THE PRESENT CASE, I FIND THAT THE FACTS ARE SIMILAR AND LD DR OF THE REVENUE ALSO COULD NOT POINT OUT ANY DIFFERENCE IN FACTS AND HENCE, BY RESPECTFUL LY FOLLOWING THIS JUDGMENT OF KARNATAKA HIGH COURT, I SET ASIDE THE ORDER OF LD CIT(A) AND RESTORE THE MATTER TO THE FILE OF THE AO FOR FRESH DECISION WITH THE SAME DIRECTIONS AS WERE GIVEN BY THE HON'BLE KARNATAKA HIGH COURT IN THE CASE AS PER PARA NO.8 O F THE JUDGMENT REPRODUCED ABOVE. IN VIEW OF THIS DECISION, NO ADJUDICATION IS CALLED FOR AT THIS STAGE REGARDING THE MERIT OF THE ADDITION. 9 IT A NO S . 689 TO 692 /BANG/201 8 5. RESPECTFULLY FOLLOWING THIS TRIBUNAL ORDER, I DECIDE THIS ISSUE IN THE PRESENT CASE ALSO ON SIMILAR LINE AND R ESTORE THE MATTER BACK TO THE FILE OF AO FOR FRESH DECISION WITH THE SAME DIRECTIONS AS WERE GIVEN BY HON'BLE KARNATAKA HIGH COURT IN THE CASE OF CHANDRA DEVI KOTHARI (SUPRA) AS PER PARA 8 OF THE JUDGMENT WHICH IS REPRODUCED ABOVE. IN VIEW OF THIS DECISIO N, NO ADJUDICATION IS CALLED FOR REGARDING MERIT OF THE ADDITION. 7.3 IN THE LIGHT OF THE ABOVE FACTUAL MATRIX OF THE CASE, AS DISCUSSED ABOVE AND IN THE LIGHT OF THE TRIBUNAL ORDERS CITED (SUPRA), WE SET ASIDE THE ORDERS OF THE AUTHORITIES BEL OW AND RESTORE THE MATTERS BACK TO THE FILE OF THE ASSESSING OFFICER FOR FRESH EXAMINATION, CONSIDERATION AND ADJUDICATION IN ACCORDANCE WITH THE DIRECTIONS AS GIVEN BY THE HON'BLE KARNATAKA HIGH COURT IN THE CASE OF CHANDRA DEVI KOTHARI (SUPRA), AS PER PA RA 8 OF THE SAID JUDGMENT WHICH IS EXTRACTED AT PARA 7.2 OF THIS ORDER (SUPRA). CONSEQUENTLY, ADJUDICATION OF THE GROUNDS RAISED ON THE MERITS OF ADDITION S ARE NOT CALLED FOR. 8. IN RESPECT OF THE GROUNDS RAISED IN RESPECT OF VALIDITY OF ASSESSM ENT PROCEEDINGS, ISSUE OF NOTICE UNDER SECTION 148 OF THE ACT, ETC. THE LEARNED AUTHORISED REPRESENTATIVE OF THE ASSESSEE SUBMITTED BEFORE THE BENCH THAT THESE ISSUES ARE NOT PRESSED AND WE, THEREFORE, DISMISS THESE GROUNDS AS NOT PRESSED. 10 IT A NO S . 689 TO 692 /BANG/201 8 9. IN THE RESULT, THE ASSESSEE'S APPEALS FOR ASSESSMENT YEARS 2008 - 09 & 2009 - 10 ARE PARTLY ALLOWED FOR STATISTICAL PURPOSES. ASSESSEE'S APPEALS IN ITA NOS.689 & 691/BANG/2018 FOR A.YS 2008 - 09 & 2009 - 10. 10. THESE APPEALS BY THE ASSESSEE ARE DIRECTED AGAINST TH E ORDERS OF THE CIT (APPEALS) 4 , BANGALORE DT.31.10.2017 UPHOLDING THE LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT FOR ASSESSMENT YEARS 2008 - 09 & 2009 - 10 . IN THIS ORDER (SUPRA), WE HAVE SET ASIDE THE ORDERS OF ASSESSMENT OF THE AUTHORITIES BELOW FOR ASSESSMENT YEARS 2008 - 09 & 2009 - 10 IN THE CASE ON HAND ON THE QUANTUM ADDITIONS MADE BY THE ASSESSING OFFICER WHICH FORMED THE BASIS FOR THE BASIS FOR LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT ON THE ASSESSEE. AS THE IMPUGNED ORDERS OF THE AUTHORITIES BELOW ON QUANTUM ADDITIONS MADE HAVE BEEN SET ASIDE BY ORDER IN ITA NO.690 & 692/BANG/2018 (SUPRA) AND MATTERS RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR FRESH EXAMINATION AND ADJUDICATION; THE PENALTY LEVIED UNDER SECTION 271(1)(C) OF T HE ACT BASED THEREON IN THE IMPUGNED ORDERS WOULD NOT NOW SURVIVE FOR CONSIDERATION AND ARE ACCORDINGLY CANCELLED. WE, THEREFORE, REFRAIN FROM ADJUDICATING 11 IT A NO S . 689 TO 692 /BANG/201 8 THE GROUNDS RAISED BY THE ASSESSEE, AT S.NOS.1.1 TO 3 IN ITS APPEAL, ON THE LEVY OF PENALTY. WE, HOWEVER, MAKE IT CLEAR THAT REVENUE IS AT LIBERTY TO INITIATE PENALTY PROCEEDINGS AFRESH WHILE COMPUTING THE FRESH ORDERS OF ASSESSMENT FOR ASSESSMENT YEARS 2008 - 09 & 2009 - 10 , AS PER LAW, IF SO WARRANTED. 11. IN THE RESULT, THE ASSESSEE'S APPEALS FOR ASS ESSMENT YEARS 2008 - 09 & 2009 - 10 IN RESPECT OF LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT ARE ALLOWED AS INDICATED ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON THE 15TH DAY OF JUNE, 201 8 . SD/ - (N.V. VASUDEVAN) JUDICIAL MEMBER SD/ - (JASON P BOAZ) ACCOUNTANT MEMBER BANGALORE, DT. 15 .06.2018. * REDDY GP COPY TO : 1 APPELLANT 4 CIT(A) 2 RESPONDENT 5 DR. ITAT, BANGALORE 3 CIT 6 GUARD FILE SENIOR PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL BANGALORE .