ITO, Pudukkottai V. S.P.Natarajan, Pudukkottai

ITA 766/CHNY/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 8286 (ITAT-CHENNAI)
• Duration Of Justice: 8 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-01-2016
• Appeal Filed By: Department
• Bench Allotted: B
• Next Hearing Date: 24-11-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 10-04-2015
• Court: TRIBUNAL
• Department Lawyers: A B KOLI
• Section: 143(3); 147; 69

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : CHENNAI . . . , . !' , # $ % [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ] ./ I.T.A.NO.766/MDS/2015 & C.O NO.81/MDS/2015 / ASSESSMENT YEAR : 2006-07 THE INCOME TAX OFFICER WARD I PUDUKKOTTAI VS. SHRI S P NATARAJAN T.S NO.5400 MARTHANDAPURAM II STREET PUDUKKOTTAI 622 001 [PAN AJUPS 2204 D ] ( APPELLANT ) (RESPONDENT /CROSS OBJE C TOR ) DEPARTMENT BY : SHRI A B KOLI, JCIT ASSESSEE BY : SHRI PHILIP GEORGE, ADVOCATE / DATE OF HEARING : 24 - 1 1 - 2015 / DATE OF PRONOUNCEMENT : 01 - 01 - 2016 / O R D E R PER N.R.S.GANESAN, JUDICIAL MEMBER THIS APPEAL OF THE REVENUE AND CROSS OBJECTION O F THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF THE C OMMISSIONER OF INCOME-TAX (APPEALS)-2, TIRUCHIRAPALLI, DATED 17.12 .2014 FOR ASSESSMENT YEAR 2006-07. 2. THE FIRST GROUND OF APPEAL IS WITH REGARD TO ADDITI ON OF ` 10 LAKHS. ITA NO. 766/15 CO 81/15 :- 2 -: 3. SHRI A B KOLI, LD. DEPARTMENTAL REPRESENTATIVE SUBM ITTED THAT THE ASSESSEE CLAIMED BEFORE THE ASSESSING OFFICER THAT HE RECEIVED A LOAN OF ` 10 LAKHS FROM SHRI N KRISHNAMURTHY ALIAS N VAIDYAL INGAM. ACCORDING TO THE LD. DR, THE ABOVE SAID SHRI N KRIS HNAMURTHY ALIAS N VAIDYALINGAM IS NONE OTHER THAN THE ASSESSEES SON . THE ASSESSING OFFICER FOUND THAT DURING THE EARLIER ASSESSMENT PR OCEEDINGS, THE ASSESSEE CLAIMED BEFORE THE ASSESSING OFFICER THAT HE HAS NOT RECEIVED ANY LOAN FROM ANY ONE DURING THE YEAR UNDER CONSIDE RATION. IN VIEW OF THE CONTRADICTORY STATEMENT MADE BEFORE THE ASSESSI NG OFFICER THAT HE HAS NOT RECEIVED ANY LOAN FROM ANY ONE ON EARLIER O CCASION AND SUBSEQUENTLY HE CLAIMED THAT A SUM OF ` 10 LAKHS WAS RECEIVED AS LOAN, THE ASSESSING OFFICER DOUBTED THE EXPLANATION OF THE ASSESSEE AND MADE ADDITION OF ` 10 LAKHS U/S 69 OF THE ACT. ON APPEAL BY THE ASSESSEE, THE CIT(A) HOWEVER, FOUND THAT THERE WAS NO BANK ACCOUNT IN THE ASSESSEES NAME AND THE MONEY DEPOSITED IN THE BANK ACCOUNT REPRESENT THE TRANSACTION OF ALL THE FAMILY MEMBERS AND NOT THE ASSESSEE ALONE. ACCORDING TO THE LD. DR, WHEN THE ASSESSEE CLAIMS THAT HE HAS NOT TAKEN ANY LOAN FROM ANY ONE DURING THE YEAR UNDER CONSIDERATION, THE CLAIM OF THE ASSESSEE THAT THE DEPOSIT REPRESENTS THE FAMILY MEMBERS TRANSACTION, THEREFORE, NO ADDI TION COULD BE MADE IN HIS HANDS CANNOT BE ACCEPTED. THEREFORE, TO THA T EXTENT, THE CIT(A) ITA NO. 766/15 CO 81/15 :- 3 -: HAS COMMITTED AN ERROR IN DELETING THE ADDITION MAD E BY THE ASSESSING OFFICER. 4. THE NEXT GROUND OF APPEAL IS WITH REGARD TO ADDITIO N OF ` 4,81,953/- TOWARDS INTEREST ACCRUED TO THE ASSESSE E ON THE DIFFERENCE BETWEEN THE FIXED DEPOSIT OF ` 1,46,53,641/- AND THE MATURED AMOUNT OF ` 1,51,35,594/-. ACCORDING TO THE LD. DR, SINCE THE ADDITION OF ` 10 LAKHS WAS ADDED IN THE HANDS OF THE ASSESSEE, THE INTEREST ACCRUED HAS ALSO TO BE ADDED IN THE HANDS OF THE ASSESSEE. 5. ON THE CONTRARY, SHRI PHILIP GEORGE, LD. COUNSEL FO R THE ASSESSEE SUBMITTED THAT THE ASSESSEE MAINTAINS ONL Y ONE BANK ACCOUNT FOR ALL TRANSACTIONS OF THE ENTIRE FAMILY M EMBERS. THEREFORE, THE DEPOSITS AND WITHDRAWALS MADE IN THE BANK DO NO T REPRESENT THE TRANSACTION OF THE ASSESSEE ALONE. ACCORDING TO T HE LD. COUNSEL, THE ASSESSEE DOES NOT OWN ANY FIXED DEPOSIT IN ANY BANK . THE LD. COUNSEL FURTHER CLARIFIED THAT EITHER IN THE ORIGINAL ASSES SMENT PROCEEDINGS OR IN THE PRESENT PROCEEDINGS THE ASSESSEE NEVER CLAIMED THAT HE HAS TAKEN ANY LOAN FROM ANY PERSON. THEREFORE, THE ASSESSING OFFICER IS NOT JUSTIFIED IN ASSUMING THAT THE ASSESSEE HAS AVAILE D A LOAN OF ` 10 LAKHS FROM HIS SON WHICH REMAINS TO BE EXPLAINED. THE LD. COUNSEL FURTHER SUBMITTED THAT IN THE EARLIER ROUND OF LITI GATION, THIS TRIBUNAL REMANDED THE MATTER BACK TO THE FILE OF THE ASSESSI NG OFFICER. IN THE ITA NO. 766/15 CO 81/15 :- 4 -: MEANTIME, THE ASSESSING OFFICER REOPENED THE ASSESS MENT U/S 147 OF THE ACT. ACCORDING TO THE LD. COUNSEL, ONCE THE AS SESSMENT WAS REOPENED, THE EARLIER ASSESSMENT WOULD ABATE, THERE FORE, THE ASSESSMENT MADE IN THE EARLIER ASSESSMENT CANNOT C ONTINUE. HENCE, THE ASSESSEE HAS FILED CROSS OBJECTION. SINCE THE DEPARTMENT HAS NOT CLAIMED THAT THE TRANSACTION IN THE BANK ACCOUNT RE PRESENTS THE ASSESSEES ALONE, ACCORDING TO THE LD. COUNSEL, THE RE CANNOT BE ANY ADDITION WITH REGARD TO THE TRANSACTION OF ` 10 LAKHS WHICH WAS FOUND TO BE DEPOSITED IN THE BANK ACCOUNT. REFERRING TO THE ORDER OF THE CIT(A), THE LD. COUNSEL SUBMITTED THAT THE VERY SAM E BANK ACCOUNT CONFIRMS THAT THE DEPOSIT WAS MADE IN THE NAME OF S HRI SUBRAMANIAN AND NOT IN THE NAME OF THE ASSESSEE. THE SAID SHR I SUBRAMANIAN IS ALSO ASSESSED BY THE VERY SAME OFFICER. THEREFORE, IF AT ALL ANY ADDITION IS TO BE MADE, IT HAS TO BE MADE IN THE HA NDS OF SHRI SUBRAMANIAN AND NOT IN THE HANDS OF THE ASSESSEE. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. TH E ASSESSEE CLAIMS THAT ONLY ONE BANK ACCOUNT WAS MAINTAINED WHICH REF LECTS THE TRANSACTION OF ALL THE FAMILY MEMBERS. THIS FACT I S NOT DISPUTED BY THE REVENUE. THE ONLY CONTENTION OF THE LD. DR IS THA T IN THE EARLIER PROCEEDINGS THE ASSESSEE CLAIMED THAT NO LOAN WAS BORROWED FROM ANY ONE DURING THE YEAR UNDER CONSIDERATION. HOWEV ER, NOW THE ITA NO. 766/15 CO 81/15 :- 5 -: ASSESSEE CLAIMS THAT HE RECEIVED A SUM OF ` 10 LAKHS FROM HIS SON. THE LD. COUNSEL CONTENDS THAT THE ASSESSEE NEVER C LAIMED BEFORE THE ASSESSING OFFICER EITHER IN THE ORIGINAL PROCEEDING S OR IN THE PRESENT PROCEEDINGS THAT HE RECEIVED ANY LOAN FROM ANYONE. FROM THE ORDER OF THE CIT(A) IT APPEARS THAT A SUM OF ` 10 LAKHS WAS DEPOSITED IN BANK BY SHRI SUBRAMANIAN AND NOT BY THE ASSESSEE. WHEN SHRI SUBRAMANIAN DEPOSITED THE MONEY AND THE BANK ACCOUN T RELATES TO ALL THE FAMILY MEMBERS, THIS TRIBUNAL IS UNABLE TO ACC EPT THE CONTENTION OF THE LD. DR. THEREFORE, THE CIT(A) HAS RIGHTLY D ELETED THE ADDITION MADE BY THE ASSESSING OFFICER. WHEN THE DEPOSIT OF ` 10 LAKHS CANNOT BE ADDED IN THE HANDS OF THE ASSESSEE, THE INTERES T ACCRUED ON SUCH DEPOSIT OF ` 4,81,953/- ALSO CANNOT BE TAXED IN THE HANDS OF TH E ASSESSEE. THEREFORE, THIS TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE CIT(A). ACCORDINGLY, THE SAM E IS CONFIRMED. 7. NOW COMING TO THE CROSS OBJECTION OF THE ASSESSEE, THE ONLY CONTENTION OF THE ASSESSEE IS THAT ONCE THE ASSESS MENT WAS REOPENED, THE ORIGINAL ASSESSMENT COMPLETED BY THE ASSESSING OFFICER U/S 143(3) IS ABATED. THIS TRIBUNAL IS UNABLE TO ACCEPT THE C ONTENTION OF THE ASSESSEE. RE-ASSESSMENT U/S 147 OF THE ACT IS ONL Y IN RESPECT OF THE INCOME WHICH ESCAPED THE ASSESSMENT. IN OTHER WORD S, THE INCOME WHICH WAS SUBJECT MATTER OF ASSESSMENT IN PROCEEDIN GS U/S 143 REMAINS AS SUCH AND THE ASSESSING OFFICER IS EMPOWE RED TO ASSESS THE ITA NO. 766/15 CO 81/15 :- 6 -: ESCAPED INCOME FOR TAXATION IN RE-ASSESSMENT PROCEE DINGS. THEREFORE, THIS TRIBUNAL IS UNABLE TO ACCEPT THE CONTENTION OF THE LD. COUNSEL IN THE CROSS OBJECTION. 8. IN THE RESULT, THE APPEAL OF THE REVENUE AND THE C ROSS OBJECTION OF THE ASSESSEE STAND DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 1 ST JANUARY, 2016, AT CHENNAI. SD/- SD/- ( . !' ) (A. MOHAN ALANKAMONY) # / ACCOUNTANT MEMBER ( . . . ) ) (N.R.S. GANESAN) / JUDICIAL MEMBER / CHENNAI ! / DATED: 1 ST JANUARY, 2016 RD !' # $% &% / COPY TO: 1 . '( / APPELLANT 4. ) / CIT 2. #*'( / RESPONDENT 5. %+, # - / DR 3. ) () / CIT(A) 6. ,/ 0 / GF