DCIT, Circle-2(2), Hyderabad, Hyderabad V. Hyderabad Race Club, Hyd, Hyderabad

ITA 732/HYD/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2534 (ITAT-HYDERABAD)
• Duration Of Justice: 9 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-02-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 28-04-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R LAXMAN

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER ITA NO. A.Y. APPELLANT RESPONDENT 1661/HYD/16 2012-13 THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-2(2), HYDERABAD M/S. HYDERABAD RACE CLUB, HYDERABAD [PAN: AAACH2773C] 732/HYD/17 2013-14 FOR REVENUE : SHRI R. LAXMAN, CIT-DR FOR ASSESSEE : SHRI K.C. DEVDAS, AR DATE OF HEARING : 07-02-2018 DATE OF PRONOUNCEMENT : 14-02-2018 O R D E R PER B. RAMAKOTAIAH, A.M. : THESE TWO APPEALS ARE BY REVENUE AGAINST THE ORDERS OF THE COMMISSIONER OF INCOME TAX (APPEALS)-2, HYDERABA D, DATED 28-07-2016 AND 30-01-2017 FOR THE AYS. 2012-13 & 201 3-14. SINCE COMMON ISSUE IS INVOLVED IN BOTH OF THESE APPE ALS, WE HAVE HEARD THESE TOGETHER AND DECIDED BY THIS COMMON O RDER. 2. BRIEFLY STATED, ASSESSEE, A RACE CLUB MAINTAINS ITS RECORD ON COMPUTER AND ON THE WINNINGS OF RS. 5,000/- AND L ESS, IT I.T.A. NOS. 1661/HYD/2016 & 732/HYD/2017 :- 2 -: DOES NOT MAINTAIN NAME AND ADDRESS OR OTHER DETAILS. AS IN EARLIER YEARS, AO DISALLOWED 15% OF THE PAYMENTS AS A DHOC DISALLOWANCE FOR NON-VERIFICATION. 3. ON AN APPEAL, LD.CIT(A) FOLLOWED THE ORDERS OF IT AT IN EARLIER YEARS AND DECIDED THE ISSUE IN FAVOUR OF ASS ESSEE. THE ORDER OF LD.CIT(A) FOR THE AY. 2012-13 IS AS UNDER: 6.2. I HAVE GONE THROUGH THE AO'S OBSERVATIONS AND AR'S CONTENTIONS. IT IS SEEN FROM THE ASSESSMENT ORDER T HAT THE AO HAS MADE ADHOC DISALLOWANCE OF RS.78,42,48,462/- TOWARD S UNVERIFIABLE EXPENDITURE. IT IS TO BE MENTIONED HERE THAT IN THE ASSESSEE'S OWN CASE FOR THE FOR EARLIER YEARS, THE HON'BLE ITAT, H YDERABAD VIDE ORDERS BELOW HELD AS UNDER: I) ITA NO 313/HYD/2011 FOR THE AY 2004-05 II) ITA NO 312A-4/D/2011 FOR THE AY 2005-06 III) ITA NO.1059/HYD/2011 FOR THE AY 2006-07 IV) ITA NO 1425/HYD/2011 FOR THE AY 2007-08 V) ITA NO.120/HYD/2012 FOR THE AY 2008-09 DT. 16.07.20 12 VI) ITA NO 108/HO/2013 FOR THE AY 2009-10 DT 30.04.2013 '7. WE HAVE CONSIDERED RIVAL SUBMISSIONS OF THE PAR TIES AND PERUSED THE MATERIAL ON RECORD ON PERUSAL OF THE DO CUMENTS SUBMITTED BEFORE UNDER SECTION WE FIND THAT IDENTIC AL ISSUE OF AD HOC DISALLOWANCES OF 15% CAME UP FOR CONSIDERATION BEFO RE THE IT APPELLATE TRIBUNAL. HYDERABAD BENCH IN CASE OF THE VERY SAME ASSESSEE RIGHT FROM THE AY 2004-05. THE COORDINATE BENCH OF THIS TRIBUNAL IN A SERIES OF ORDERS HAVE DECIDED THE ISS UE IN FAVOUR OF THE ASSESSEE. IN THE LATEST ORDER PASSED FOR THE A Y. 2 008-09 IN (ITA NO. 120/HYD/2012 DT 16 07.2012. THE TRIBUNAL FOLLOWING ITS EARLIER ORDER DELETED THE ADDITION BY OBSERVING AS UNDER - '5. WE HAVE HELD THE ARGUMENTS OF BOTH THE PARTIES. PERUSED THE RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW WE FIND THAT THIS ISSUE IS COVERED BY THE ORDER OF THE ITAT HYDERABAD BENCHES IN ASSESSEE 'S OWN CASE FOR A.Y 2007-08 VIDE IN ITA NO. 1425/HYD/2011 VIDE PAGES 2 TO 11 OF THE ORDER AND AT PARE 8, THE TRIBUNAL HELD AS FOLLOWS: I.T.A. NOS. 1661/HYD/2016 & 732/HYD/2017 :- 3 -: WE FIND THE EARLIER ORDER OF THE ITAT HAVE ELABORAT ELY DEALT WITH THE ISSUE. THE DEPARTMENT HAS NOT BROUGHT ANYTHING TO SHOW THAT TH E FACTS OF THE CASE ARE ANY DIFFERENT FROM THAT FOR THE AY 2004-05 AND 2005-06 COVERED BY THE ITAT ORDER THE ACTIVITY OF THE ASSESSEE IS SUCH THAT THEY HAVE TO DEAL DAILY WITH NUMEROUS INDIVIDUALS ILL A SHORT SPAN OF TIME WHEN THE BATTI NGS ARE ON. THEY ACCEPT BETS AND SETTLE THE WINNING AMOUNTS TO ME WINNING PUNTERS. I T WILL BE DIFFICULT TO MAINTAIN COMPLETE DETAILS ABOUT ALL THE PERSONS. THE ENTIRE PAYMENT WAS THROUGH COMPUTERIZED SYSTEM THE PAYMENT WAS MADE TO THE PER SON HOLDING THE WINNING TICKET THE DEPARTMENT HAS NOT BROUGHT TO OUT NOTICE OF ANY INSTANCE OF PAYMENT WHEN THERE WAS NO WINNING TICKET IN THE CIRCUMSTANC ES. RESPECTFULLY FOLLOWING THE DECISION OF THE COORDINATE BENCH IN THE ASSESSEE'S OWN CASE WE DELETE THE AD HOC DISALLOWANCE OF 10% OF THE TOTAL PAYMENT FOR WINNIN G BETS OF LESS THAN 2500/- EACH THE APPEAL OF THE ASSESSED ON THIS ISSUE IS ALLOWED . 6. SINCE THE ISSUE UNDER CONSIDERATION IS IDENTICAL TO THE ONE DECIDED BY THE CO-ORDINATE BENCH IN ASSESSEE'S OWN CASE FOR AY 200 7-08 (SUPRA), RESPECTFULLY FOLLOWING THE SAME. WE SET ASIDE WE ORDER OF THE CO MMISSIONER OF INCOME TAX(A) AND ALLOWED THIS GROUND OF APPEAL OF THE ASSESSEE. SINCE THE ISSUE IN DISPUTE IS SQUARELY COVERED BY T HE DECISION OF THE CO- ORDINATE BENCH AS REFERRED TO ABOVE. WE RESPECTFULL Y FOLLOW THE SAME AND UPHOLD THE ORDER OF THE COMMISSIONER OF INCOME TAX(A) ITR DELETING THE ADDITION ON ACCOUNT OF AD HOC DISALLOWANCE MADE BY THE ASSESSIN G OFFICER. THE GROUNDS RAISED ARE DISMISSED. HENCE, RESPECTFULLY FOLLOWING THE ORDERS OF THE JUR ISDICTIONAL ITAT IN THE ASSESSEE'S OWN CASE FOR EARLIER YEARS. THE ADHOC DI SALLOWANCE OF RS. 63,65,05,974/- IS DELETED.' SINCE THE ISSUE UNDER CONSIDERATION IS SIMILAR, THE DECISION OF THE CIT(A)-9, HYDERABAD HOLDS GOOD FOR THIS YEAR AL SO. ACCORDINGLY, I DIRECT THE AO TO DELETE THE AD HOC DISALLOWANCE OF RS.78,42,48,462/-. AS A RESULT, THE GROUNDS RAISED ARE ALLOWED. 4. AFTER CONSIDERING THE RIVAL CONTENTIONS, WE DO NOT S EE ANY REASON TO INTERFERE WITH THE ORDER OF THE LD.CIT(A), WHO FOLLOWED THE ORDER OF ITAT ON THE ISSUE. NOTHING WAS BROUGHT ON RECORD TO STATE THAT FACTS ARE DIFFERENT AND IN THE ABSENCE OF ANY DISTINGUISHING FEATURES, THE ORDER OF ITAT HAS TO BE F OLLOWED. THERE IS NO MERITS IN REVENUES GROUNDS. I.T.A. NOS. 1661/HYD/2016 & 732/HYD/2017 :- 4 -: 5. SINCE THE ISSUE IS COMMON IN ITA NO. 732/HYD/2017 (AY. 2013-14) ALSO, THE GROUNDS IN THIS APPEAL ARE AL SO DISMISSED. 6. IN THE RESULT, BOTH THE APPEALS OF REVENUE ARE DISMI SSED. ORDER PRONOUNCED IN THE OPEN COURT ON 14 TH FEBRUARY, 2018 SD/- SD/- (P. MADHAVI DEVI) (B. RAMAKOTAIAH) JUDICIAL MEMBER ACCOUNTANT MEMBER HYDERABAD, DATED 14 TH FEBRUARY, 2018 TNMM I.T.A. NOS. 1661/HYD/2016 & 732/HYD/2017 :- 5 -: COPY TO : 1. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-2( 2), HYDERABAD. 2. M/S. HYDERABAD RACE CLUB, 16-10-1/A/1, RACE COUR SE ROAD, MALAK PET, HYDERABAD. 3. CIT(APPEALS)-2, HYDERABAD 4. PR.CIT-2, HYDERABAD. 5. D.R. ITAT, HYDERABAD. 6. GUARD FILE.