ITO, Chttoor District V. Smt B.Syamalamma, Maanapalle

ITA 772/HYD/2010

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1396 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 7 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-01-2013
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 19-09-2011
• Assessment Year: 2003-2004
• Appeal Filed On: 24-05-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: M H NAIK
• Assessee Lawyers: S RAMA RAO
• Keywords: Opportunity of being heard
• Section: 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO .772/HYD/2010 ASST. YEAR 2003-04 ITO, WARD-1, MADANAPALLE. V/S. SMT. B. SYAMALAMMA, MADANAPALLE. PAN:AJUPB4652Q (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI M.H. NAIK RESPONDENT BY : SRI S. RAMA RAO DATE OF HEARING 20-12-2012 DATE OF PRONOUNCEMENT 04 -01-2013 . O R D E R PER SAKTIJIT DEY, JUDICIAL MEMBER: THE REVENUE HAS FILED THIS APPEAL BEING AGGRIEVED BY THE ORDER DATED 24-3-2010 PASSED BY THE CIT (A), TIRUPATI IN ITA NO.442/ITO- W-1/MPL/CIT(A)/TPT/09-10 PERTAINING TO THE ASSESSMENT Y EAR 2003- 04. 2. THE GROUNDS RAISED BY THE DEPARTMENT ARE DIRECTED AGAINST THE DELETION OF AMOUNT OF RS.12,28,000/- BY THE CIT (A). BRIEFLY THE FACTS ARE, THE ASSESSEE IS AN INDIVIDUAL. ON THE BASIS OF CERTA IN INFORMATION, THE ASSESSING OFFICER ISSUED NOTICE U/S 148 OF THE ACT RE-OP ENING THE ASSESSMENT IN CASE OF THE ASSESSEE FOR THE IMPUGNED ASSESSMENT Y EAR. IN RESPONSE TO SUCH NOTICE, THE ASSESSEE FILED A RETURN OF INCOME DECLARING A TOTAL INCOME OF RS.84,430/-. IN COURSE OF T HE SCRUTINY ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER FOUND FROM THE ITA NO.772 OF 2010 B. SYAMALAMMA, MADANAPALLE . 2 STATEMENTS RECORDED FROM THE PARTNERS OF M/S SRINIVASA RESIDENTIAL (FIRM), PRASANTNAGAR AND OTHER RECORDS THAT THE ASSESSEE HAS INVESTED AN AMOUNT OF RS.12,28,000/- IN THE AFORESAID FIRM DUR ING THE ASSESSMENT YEAR 2003-04. HOWEVER, IN THE RETURN OF INCOM E, THE ASSESSEE HAS NOT DISCLOSED SUCH INVESTMENT MADE BY HER. THE ASSESSING OFFICER THEREFORE ASKED THE ASSESSEE TO EXPLAIN ABO UT THE SOURCE OF SUCH INVESTMENT MADE BY HER. IN RESPONSE TO THE QUERY MADE BY THE ASSESSING OFFICER THE ASSESSEE EXPLAINED THAT THE IN VESTMENT MADE IN M/S SRINIVASA RESIDENTIAL (FIRM) IS IN THE CAPA CITY OF REPRESENTATIVE OF HUF IN THE NAME AND STYLE OF B. K RISHNA REDDY. IT WAS FURTHER CONTENDED BY THE ASSESSEE THAT THE INVESTMENT MADE BY HER IN THE PARTNERSHIP FIRM AS A REPRESENTATIVE OF THE HUF IS ONLY RS.5,03,900/- AND NOT RS.12,28,000/-. THE ASSESSING OFFI CER HOWEVER DID NOT ACCEPT SUCH EXPLANATION OF THE ASSESSEE BY OBSERVIN G THAT THE CHEQUES GIVEN BY THE ASSESSEE TOWARDS INVESTMENT IN THE PAR TNERSHIP FIRM HAVING ROUTED THROUGH HER INDIVIDUAL BANK OVER DRAFT ACCOUNT NO.47. HENCE, IT CANNOT BE SAID THAT THE INVESTMENT HAS BEEN MADE IN THE CAPACITY OF A REPRESENTATIVE OF THE HUF. THE ASSESSING OFFICER FURTHER OBSERVED THAT ONLY UPON DETECTION OF UNDISCLO SED INVESTMENT MADE BY THE ASSESSEE IN THE PARTNERSHIP FIRM THE ASSESSEE HA S COME FORWARD WITH THE STORY OF INVESTMENT MADE BY HUF. ACC ORDINGLY, THE ASSESSING OFFICER ADDED THE AMOUNT OF RS.12,28,000/- ALON G WITH INTEREST OF RS.21,240 TOTAL AMOUNTING TO RS.12,49,240/ -. 3. THE ASSESSEE BEING AGGRIEVED OF THE ADDITION MADE BY THE ASSESSING OFFICER, FILED AN APPEAL BEFORE THE CIT (A). IN COURSE OF HEARING BEFORE THE CIT (A), THE ASSESSEE CONTENDED THAT THE INVESTMENT MADE IN THE PARTNERSHIP FIRM DOES NOT BELONG TO HER B UT HAS BEEN MADE BY HER HUSBANDS HUF B. KRISHNA REDDY. IT WAS FURTHER CONTENDED BY THE ASSESSEE THE ALLEGED INVESTMENT OF RS.12,28,000/- IS N OT CORRECT ITA NO.772 OF 2010 B. SYAMALAMMA, MADANAPALLE . 3 WHICH IS DUE TO DISCREPANCY IN A STATEMENT GIVEN BY THE FIRM. THE ACTUAL INVESTMENT IS ONLY OF RS.5,03,900/-. THE ASSESSEE ALSO PRODUCED CERTAIN DOCUMENTS BEFORE THE CIT (A) IN SUPPORT OF HER CONTENTION. THE CIT (A) ACCEPTED THE ASSESSEES CONTENTION THAT THE ACTUAL INVESTMENT MADE IS NOT RS.12,28,000/- BUT RS.5,0 3,900/-. THE CIT (A) ALSO ACCEPTED THE PLEA OF THE ASSESSEE THAT THE I NVESTMENT HAS BEEN MADE OUT OF FUNDS OF THE HUF. ON THE AFORESAID B ASIS, THE CIT (A) DELETED THE ADDITION. 4. THE LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITT ED BEFORE US THAT THE CIT (A) WITHOUT PROPERLY CONSIDERING THE FACT S AND MATERIALS ON RECORD HAS ARRIVED AT HIS CONCLUSION THAT THE INVESTMENT IS ONLY RS.5,03,900/- AND THAT TOO HAS BEEN MADE BY THE HUF. THE LEARNED DEPARTMENTAL REPRESENTATIVE FURTHER SUBMITTED BEFORE US THAT THE CIT (A) HAS NOT AT ALL VERIFIED THE BANK ACCOUNT THROUGH W HICH THE INVESTMENT HAS BEEN MADE WHICH ARE IN THE INDIVIDUAL CAPACITY. THE LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT S INCE THE CIT (A) HAS NOT PROPERLY VERIFIED THE FACT, THE MATTER IS REQU IRED TO BE REMITTED BACK TO THE ASSESSING OFFICER FOR PROPER VERIFICATION. 5. THE LEARNED AR, ON THE OTHER HAND, SUBMITTED THA T THE CIT (A) HAVING PASSED THE ORDER AFTER APPLYING HIS MIND TO ALL FACTS AND MATERIALS ON RECORD, HIS ORDER SHOULD BE SUSTAINED. 6. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATE RIAL ON RECORD. IT IS SEEN FROM THE ASSESSMENT ORDER THE MAIN REASON ON WHICH THE ASSESSING OFFICER HAS FORMED A CONCLUSION THAT THE INVESTMENT HAS BEEN MADE BY THE ASSESSEE IS DUE TO THE F ACT THAT THE CHEQUES WHICH WERE GIVEN TOWARDS INVESTMENT IN THE FIRM HAVE BEEN ROUTED THROUGH THE OD A/C NO.47 IN INDIAN BANK WHICH STANDS IN THE NAME OF THE ASSESSEE IN HER INDIVIDUAL CAPACITY. IT IS FURTHER SEEN FROM THE ORDERS OF THE LOWER AUTHORITIES THAT WHILE THE ASSESSING ITA NO.772 OF 2010 B. SYAMALAMMA, MADANAPALLE . 4 OFFICER HAS STATED IN HIS ASSESSMENT ORDER THAT THE INVESTM ENT MADE IN THE PARTNERSHIP FIRM IS RS.12,28,000/- THE CIT (A) HAS ACCEPTED THE ASSESSEES CONTENTION THAT THE INVESTMENT MADE IN THE PART NERSHIP IS ONLY RS.5,03,900/-. IT IS NOT EVIDENT FROM THE ORDE R OF THE CIT (A) AS TO ON WHAT BASIS, HE HAS COME TO THE CONCLUSION THAT THE INVE STMENT MADE IS ONLY RS.5,03,900/- BUT NOT RS.12,28,000/-. IT IS A LSO NOT REVEALED FROM THE ORDER OF THE CIT (A) WHETHER THE BANK ACCOU NTS EXAMINED BY HIM WERE THE SAME THROUGH WHICH THE INVESTMENT IN TH E PARTNERSHIP FIRM HAS BEEN MADE AND WHETHER SUCH BANK ACCOUNTS BELO NG TO THE HUF. THESE FACTS HAVE NOT BEEN DEALT EXHAUSTIVELY BY THE CIT (A) IN HIS ORDER. WE ARE ALSO UNABLE TO GIVE A CONCLUSIVE FIND ING EITHER WITH REGARD TO QUANTUM OF INVESTMENT OR WITH REGARD TO TH E STATUS, IN WHICH SUCH INVESTMENT HAS BEEN MADE, AS NO MATERIAL IN THAT R EGARD HAS BEEN PLACED BEFORE US. CONSIDERING THE TOTALITY OF FACTS A ND THE CIRCUMSTANCES OF THE CASE, WE ARE THEREFORE INCLINED TO REM IT THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER FOR MAKING A DE NOVO ASSESSMENT AFTER CONSIDERING ALL THE FACTS AND EVIDENCES AVAI LABLE ON RECORD WHICH MAY BE SUBMITTED BY THE ASSESSEE. THE ASSESSIN G OFFICER SHALL EXTEND A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE COURT ON 04-01-2013. SD/- SD/- (CHANDRA POOJARI) (SAKTIJIT DEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DT/-4 TH JANUARY, 2013. ITA NO.772 OF 2010 B. SYAMALAMMA, MADANAPALLE . 5 COPY FORWARDED TO: 1. SMT. B. SYAMALAMMA, W/O KRISHNA REDDY, III-8A-16-4, PRASANTH NAGAR, MADANAPALLE. 2. 3. 4. ITO, WARD-I, MADANAPALLE. COMMISSIONER OF INCOME-TAX (APPEALS), TIRUPATI. CIT CONCERNED, HYDERABAD. 5 DEPARTMENTAL REPRESENTATIVE, ITAT, HYDERABAD. JMR *