Sree Meenakshi Realtors, Coimbatore V. ITO, Coimbatore

ITA 715/CHNY/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 8857 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-08-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 23-03-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SHIVASRINIVAS IRS
• Assessee Lawyers: K RAGHU
• Keywords: Revised return
• Section: 234B; 148; 90; 154; 2

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI , . ! ' , #'$ BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI G. PAVAN KUMAR, JUDICIAL MEMBER ./ I.T.A. NO. 715/MDS/2016 # % &% / ASSESSMENT YEAR : 2011-2012. SREE MEENAKSHI RELTORS, 550/15, 4 TH FLOOR, WHITES D.B. ROAD, R.S. PURAM, COIMBATORE 641 002. [PAN ABXFS4768H] VS. THE INCOME TAX OFFICER, WARD II(3) COIMBATORE. ( / APPELLANT) ( /RESPONDENT) '( ) * / APPELLANT BY : SHRI. K. RAGHU, ADVOCATE +,'( ) * /RESPONDENT BY : SHRI. SHIVA SRINIVAS, IRS, JCIT ! ) - / DATE OF HEARING : 08-08-2016 ./& ) - / DATE OF PRONOUNCEMENT : 17-08-2016 / O R D E R PER G. PAVAN KUMAR, JUDICIAL MEMBER : THE APPEAL FILED BY THE ASSESSEE IS DIRECTED A GAINST ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-2, COIM BATORE, IN ITA NO.218/14-15, DATED 30.12.2015 FOR THE ASSESSMENT Y EAR 2011-2012 ITA NO.715/MDS/2016. :- 2 -: PASSED U/S.143(3) R.W.S 147 AND 250 OF THE INCOME TAX ACT, 1961 (HEREIN AFTER REFERRED TO AS THE ACT). 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: (1) THE LEARNED CIT(A) OUGHT TO HAVE HELD THAT I NTEREST U/S. 234C WAS NOT CHARGEABLE AT ALL, BY THE AO ON THE BA SIS OF 'TAX DUE ON THE RETURNED INCOME ULS 147 OF THE I T. ACT, 1961, AS THERE WAS NO FAILURE OF THE NATURE DESCRIB ED IN THAT SECTION READ WITH 'EXPLANATION' UNDER SECTION 234C, THE APPELLANT HAVING FURNISHED A RETURN ULS 139, ENTITLING IT TO A REFUND OF TAX, IN THE FACTS AND THE CIRCUMSTANCES O F THE CASE AND IN LAW. (2) THE LEARNED CIT(A) , OUGHT TO HAVE HELD THAT' TAX DUE ON THE RETURNED INCOME' UNDER EXPLANATION TO SE CTION 234C OF THE I T. ACT, 1961, MEANS THE TAX CHARGEAB LE ON THE TOTAL INCOME DECLARED IN THE RETURN FURNISHED B Y THE APPELLANT IX] S 139(1) OF THE ACT, AND NOT ON THE BASIS OF A SECOND RETURN FILED IN RESPONSE TO THE NOTICE ISSUE D U/ S 148 OF THE ACT, UNLESS SUCH RETURN WAS THE ONLY RETURN FURNISHED BY THE APPELLANT, FOR THE ASSESSMENT YEAR, IN THE F ACTS AND THE CIRCUMSTANCES OF THE CASE AND IN LAW. (3) THE LEARNED CIT (A) IS WRONG IN HOLDING THAT T HE APPELLANT IS LIABLE TO PAY ADVANCE TAX, ON THE BASI S OF THE TOTAL INCOME DECLARED IN THE SECOND RETURN FURNISHE D ULS 148, BY INTERPRETING THE MEANING OF THE WORDS 'TAX DUE O N THE RETURNED INCOME', APPLICABLE IN RESPECT OF THE RETU RN FURNISHED ULS 139 (1) OF THE ACT, WOULD ALSO COVER THE SECOND AND SUBSEQUENT RETURNS FURNISHED ULS 148, FOR THE SAME ASSESSMENT YEAR, IN THE FACTS AND THE CIRCUMSTANCES OF THE CASE AND IN LAW. (4) FOR THESE AND OTHER ADDITIONAL GROUNDS OF APPE AL THAT MAY BE ADDUCED AT THE TIME OF HEARING, THE OR DER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-2, COIMBATORE, IS OPPOSED TO LAW AND UNSUSTAINABLE IN THE FACTS AND THE CIRCUMSTANCES OF THE CASE. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE I S A PARTNERSHIP FIRM AND IN THE BUSINESS OF REAL ESTAT E AND ENGAGED IN PROMOTION OF LAYOUT AND SALE OF PLOTS AND FILED TH E RETURN OF INCOME ITA NO.715/MDS/2016. :- 3 -: ON 30.07.2011 WITH TOTAL INCOME OF =1,22,270/-. SUB SEQUENTLY, SURVEY U/S.133A OF THE ACT WAS CONDUCTED AT A PARTNER PLAC E ON 04.09.2013. DURING THE SURVEY OPERATIONS, THE REVENUE HAS FOUN D PAYMENT OF IMPUGNED ON-MONEY OF =1,19,63,000/- AND THE RECEIPT OF ON-MONEY OF =57,52,302/- BY THE FIRM OUTSIDE THE BOOKS OF ACCOU NT. WHEREAS THE PARTNER ON THE ISSUE OF PAYMENT OF ON-MONEY =1,19,6 3,000/- HAS ACCEPTED THE SAME AS UNACCOUNTED IN THE YEAR 2009-2 010. SUBSEQUENT TO THE SURVEY OPERATIONS, THE LD. ASSESS ING OFFICER ISSUED NOTICE U/S.148 OF THE ACT ON THE ASSESSEE FIRM. IN COMPLIANCE TO NOTICE, THE FIRM FILED RETURN OF INCOME ON 11.12.2 013 INCLUDING ON MONEY RECEIPT OF =57,52,320/- AND PAID SELF ASSESS MENT TAX U/SEC.140A OF THE ACT ALONGWITH INTEREST. THE LD. A SSESSING OFFICER ISSUED NOTICE U/S.143(2) OF THE ACT. IN COMPLIANCE TO NOTICE, THE LD. AUTHORISED REPRESENTATIVE OF ASSESSEE APPEARED FROM TIME TO TIME AND PRODUCED BOOKS OF ACCOUNT, DETAILS OF PURCHASE AND SALES MADE DURING THE YEAR AND EXPENSES INCURRED AND THE LD. ASSESSING OFFICER AFTER VERIFICATION OF RECORDS ACCEPTED REVISED RET URN OF INCOME AND PASSED ASSESSMENT ORDER U/S.143(3) R.W.S 147 OF THE ACT DATED 23.06.2014. SUBSEQUENTLY, THE ASSESSEE FILED PETITI ON U/SEC. 154 OF THE ACT ON 21.07.2014 FOR MISTAKE APPARENT FROM RECORD IN CALCULATION OF INTEREST OF SECS 234B AND 234C OF THE ACT. THE LD. ASSESSING OFFICER PASSED ORDER U/S.154 OF THE ACT ON 08.08.2014 WITH DETAILED ITA NO.715/MDS/2016. :- 4 -: OBSERVATIONS ON THE PROVISIONS OF SECS.234B AND 234 C AND REJECTED THE PETITION. AGGRIEVED BY THE ORDER PASSED U/.143(3) R.W.S. 147 OF THE ACT, THE ASSESSEE FILED AN APPEAL BEFORE COMMISSIO NER OF INCOME TAX (APPEALS). 4. IN THE APPELLATE PROCEEDINGS, THE LD. AUTHORISED REPRESENTATIVE OF ASSESSEE ARGUED THE GROUNDS AND E XPLAINED THAT THE LD. ASSESSING OFFICER ERRED IN LEVYING INTEREST U/S .234B OF THE ACT IN ASSESSMENT U/S.143(3) R.W.S. 147 OF THE ACT BEING EXCESSIVE AND SELF ASSESSMENT TAX PAID U/S.140A OF THE ACT WAS NOT CO NSIDERED FOR CALCULATION OF INTEREST. FURTHER, THE LD. ASSESSIN G OFFICER CANNOT APPLY THE PROVISIONS OF SEC.234C OF THE ACT TO THE REASS ESSMENT ORDER AND THE INTEREST U/S.234C OF THE ACT SHALL BE LEVIED ON LY FOR SHORTFALL OF ADVANCE TAX PAID AND PAYABLE, ANY PAYMENT OF ADVANC E TAX DURING THE FINANCIAL YEAR SHALL BE GIVEN CREDIT FOR INTEREST CALCULATION. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) CONSIDERED THE SUBMISSIONS OF ASSESSMENT PROCEEDINGS AND GROUNDS WITH SPECIFIC SU BMISSIONS ON THE LEVY OF INTEREST U/S.234B OF THE ACT IN DEFAULT ON PAYMENT OF ADVANCE TAX AND INTEREST U/S.234C OF THE ACT ON DEFERENT OF ADVANCE TAX. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) CONSID ERED THE SUBMISSIONS ON THE LEVY OF INTEREST U/S.234B OF TH E ACT AS PER THE PROVISIONS OF ACT AND DIRECTED THE LD. ASSESSING OF FICER TO CONSIDER THE ITA NO.715/MDS/2016. :- 5 -: INCOME TAX PAID U/S.140A OF THE ACT AND THE PROVISI ONS OF SEC.234B(2) OF THE ACT IN CALCULATING THE INTEREST AND DISCUS SED ELABORATELY AT PARA 4.2 OF THE ORDER AND PARTLY ALLOWED THE APPEAL. IN RESPECT OF SEC.234C CHARGEABILITY OF INTEREST THE LD. COMMISSIONER OF I NCOME TAX (APPEALS) CONSIDERED THE ACTION OF THE LD. ASSESSING OFFICER IS IN ACCORDANCE WITH LAW AND INTEREST U/S.234C OF THE ACT IS ALSO LEVIED ON THE BASIS OF RETURN OF INCOME FURNISHED IN RESPONSE TO NOTICE U /S.148 OF THE ACT AND DISMISSED THE GROUND OF THE ASSESSEE ON THE PRO VISIONS OF SEC. 234C OF THE ACT. AGGRIEVED BY THE ORDER OF THE COMM ISSIONER OF INCOME TAX (APPEALS) THE ASSESSEE ASSAILED AN APPE AL BEFORE TRIBUNAL. 5. BEFORE US, THE LD. AUTHORISED REPRESENTATIVE REITER ATED THE SUBMISSIONS MADE IN ASSESSMENT, APPELLATE PROCEEDIN GS AND THE RECTIFICATION PETITION U/S.154 OF THE ACT FILED BY THE ASSESSEE WHICH WAS REJECTED. THE LD. ASSESSING OFFICER SHOULD NOT HAVE CHARGED INTEREST U/S.234C OF THE ACT ON THE TAX PAYABLE ON REVISED RETURN OF INCOME FILED IN COMPLIANCE TO NOTICE U/S.148 OF THE ACT INCLUDING THE UNACCOUNTED MONEY OF =57,52,320/-. THE INTEREST U/ S.234C OF THE ACT SHOULD BE CHARGED ON FURNISHING OF RETURN OF INCOME U/S.139(1) OF THE ACT AND TAX DUE ON RETURNED INCOME AS PER EXPL ANATION U/S.234C OF THE ACT WHICH MEANS THE RETURN OF INCOME FILED U/ S.139(1) OF THE ACT ITA NO.715/MDS/2016. :- 6 -: AND NOT THE REVISED RETURN FILED IN RESPONSE NOTICE U/S.148 OF THE ACT, THE LD. AUTHORISED REPRESENTATIVE SUBMITTED THAT D UE TO SURVEY OPERATION U/S.133A OF THE ACT THE INCOME HAS BEEN O FFERED IN THE REVISED RETURN OF INCOME FILED ON 11.12.2013 AND LE VY OF INTEREST U/S.234C OF THE ACT ON THE REVISED IS NOT IN ACCOR DANCE WITH LAW AND PRAYED FOR ALLOWING THE APPEAL. 6. CONTRA, THE LD. DEPARTMENTAL REPRESENTATIVE RE LIED ON THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) A ND OPPOSED TO THE GROUNDS. 7. WE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE CRUX OF THE ISSUE ARGUED BY THE LD. AU THORISED REPRESENTATIVE THAT THE INTEREST U/S.234C OF THE A CT SHALL NOT BE CHARGEABLE ON THE RETURN OF INCOME FILED IN COMPLI ANCE TO NOTICE U/S.148 OF THE ACT. WE FOUND THE ASSESSEE IS A PA RTNERSHIP FIRM AND FILED ORIGINAL RETURN OF INCOME ON 30.07.2011 WITHI N TIME ALLOWED U/S.139(1) OF THE ACT DISCLOSING TOTAL INCOME OF =1 ,22,270/-. DUE TO SURVEY OPERATIONS U/S.133A OF THE ACT ON 04.09.2013 , IT WAS FOUND THAT THE ASSESSEE FIRM HAS RECEIVED ON-MONEY OF =57,52,3 20/- AND SAME WAS INCLUDED IN REVISED RETURN OF INCOME FILED ON 1 1.12.2013 PAID TAXES OF =17,87,709/- INCLUDING INTEREST. THE LD. A UTHORISED REPRESENTATIVE CONTENTIONS BEING NO INTEREST U/S.2 34C OF THE ACT ITA NO.715/MDS/2016. :- 7 -: SHOULD BE CHARGED ON RETURN OF INCOME FILED IN COMPLIANCE TO NOTICE SEC. 148 OF THE ACT AS THE CHARGEABILITY PROVISIONS ARE APPLICABLE ONLY T O THE RETURN OF INCOME FILED U/S.139(1) OF THE ACT. THE PROVISION S OF CHARGING OF INTEREST U/S.234C OF THE ACT IS AUTOMATIC AND ASSES SEE NEED NOT BE PROVIDED AN OPPORTUNITY. FURTHER, WE PERUSED THE E XPLANATIONS TO THE PROVISIONS OF SEC. 234C OF THE ACT THE TAX DUE ON RETURNED INCOME SHALL BE REDUCED BY (I) TAX DEDUCTED AND COLLECTED AT SOURCE, (II) THE AMOUNT OF RELIEF OF TAX ALLOWED UNDER SECTIONS 90 A ND 90A AND DEDUCTION FROM THE INDIAN INCOME TAX PAYABLE, ALLO WED UNDER SECTION 91, AND (III) TAX CREDIT ALLOWED TO BE SET OFF UNDE R SECTION 115JAA/115JD FROM THE TAX ON THE TOTAL INCOME. THE ASSESSEE FIRM CANNOT INTERPRETE THAT THE TAX DUE ON RETURN INC OME SHALL IMPLY ONLY TO THE RETURN OF INCOME FILED U/S.139(1) OF THE AC T WERE INCOME IS DECLARED. THE PROVISIONS OF SEC.234C OF THE ACT AR E MANDATORILY APPLICABLE IN RESPECT OF DEFERMENT OF PAYMENT OF AD VANCE TAX AS PER THE RATES PRESCRIBED IN THE PREVIOUS YEAR RELEVANT TO SUBSEQUENT ASSESSMENT YEAR AND INTEREST IS CHARGED. WE ARE OF THE CONSIDERED OPINION THAT LEVY OF INTEREST U/S.234C OF THE ACT I S AN AUTOMATIC AND THE INTERPRETATION OF CHARGING OF INTEREST U/S.234C OF THE ACT CANNOT BE RESTRICTED TO THE TAX DUE ON RETURNED INCOME AS REFERRED U/SEC. 139(1) OF THE ACT IS NOT LOGICAL INTERPRETATION AN D CANNOT BE ACCEPTED ITA NO.715/MDS/2016. :- 8 -: IN THE COURT OF LAW. THE LD.CIT(A) HAS DEALT EXHA USTIVELY ON THE APPLICABILITY OF PROVISIONS AND THE EXPLANATIONS A ND UPHELD THE ORDER OF THE LD. ASSESSING OFFICER, ON CHARGING OF INTERE ST U/SEC.234C OF THE ACT ON RETURN OF INCOME FILED IN RESPONSE TO NOTICE U/SEC. 148 OF THE ACT. HENCE, WE ARE NOT INCLINED TO INTERFERE WITH T HE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) AND DISMISS TH E GROUNDS OF THE ASSESSEE. 8 IN THE RESULT, THE APPEAL OF THE ASSESSEE IN ITA NO.715/MDS/2016 IS DISMISSED. ORDER PRONOUNCED ON WEDNESDAY, THE 17 TH DAY OF AUGUST, 2016, AT CHENNAI. SD/- SD/- ( . ) (ABRAHAM P. GEORGE) / ACCOUNTANT MEMBER ( . ! ' ) (G. PAVAN KUMAR) /JUDICIAL MEMBER / CHENNAI 2 / DATED:17.08.2016 KV 3 ) +#-45 65&- / COPY TO: 1 . '( / APPELLANT 3. ! 7- () / CIT(A) 5. 5 9: +#-# / DR 2. +,'( / RESPONDENT 4. ! 7- / CIT 6. :;% < / GF