SHRI GOPAL SINGH, Jaipur V. ITO, Kishangarh

ITA 788/JPR/2011

• Counselvise Citation: 78823114 RSA 2011
• Duration Of Justice: 3 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-01-2012
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 05-09-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: D K MEENA
• Keywords: Proportionate interest

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH JAIPUR BEFORE SHRI R.K. GUPTA, JUDICIAL MEMBER ITA NO. 788/JP/2011 ASSTT. YEAR : 2008-09. PAN:CAMPS4667P SHRI GOPAL SINGH, VS. INCOME TAX OFFICER, KISHANGARH. KISHANGARH. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI NIKHLESH KATARIA, AR RESPONDENT BY : SHRI D.K. MEENA, DR DATE OF HEARING : 26/12/2011 DATE OF PRONOUNCEMENT:03.01.2012 ORDER THIS IS AN APPEAL BY ASSESSEE AGAINST THE ORDER OF CIT (A), AJMER DATED 21.06.2011 RELATING TO ASSESSMENT YEAR 2008-0 9. 2. THE ASSESSEE IS OBJECTING IN CONFIRMING THE DISA LLOWANCE OF RS.3,19,558/- ON ACCOUNT OF INTEREST ON FDR. THE AO DURING THE ASSESSMENT PROCEEDINGS NOTICED THAT THE ASSESSEE HAS SHOWN INT EREST ON FDR AT RS.8897/-. ON VERIFICATION, IT WAS FOUND THAT THIS INTEREST RECEIVED BY THE ASSESSEE AT RS.3,19,588/-. ACCORDINGLY, ASSESSEE WA S REQUIRED TO EXPLAIN THAT WHY ENTIRE ADDITION OF RS.3,19,588/- SHOULD NOT BE ASSESSED IN THE YEAR UNDER 2 CONSIDERATION. IT WAS SUBMITTED THAT THE ASSESSEE I S MAINTAINING MERCANTILE SYSTEM OF ACCOUNTING AND INTEREST RELATE TO LAST SO MANY YEARS AND ONLY INTEREST OF RS.8897/- WAS ASSESSABLE FOR THE YEAR U NDER CONSIDERATION. THE AO NOTICED THAT THE ASSESSEE IS NOT MAINTAINING MER CANTILE SYSTEM OF ACCOUNTING AND NO INTEREST HAS BEEN OFFERED FOR EAR LIER YEAR EXCEPT INTEREST OF RS.1,13,306/- IN THE YEAR 2007-08. HOWEVER, HE NOTE D THAT INTEREST IS A RECEIPT DURING THE YEAR UNDER CONSIDERATION AND IS ASSESSABLE IN THE YEAR UNDER CONSIDERATION ONLY. ACCORDINGLY, HE ASSESSED THE ENTIRE INTEREST OF RS.3,19,588/- DURING THE YEAR UNDER CONSIDERATION. THE LD. CIT(A) CONFIRMED THE ACTION OF THE A.O. 3. AFTER CONSIDERING THE WRITTEN SUBMISSIONS AND TH E ORDERS OF THE LOWER AUTHORITIES ON WHICH RELIANCE HAS BEEN PLACED BY TH E LD. DR, I FOUND THAT THE ASSESSEE DESERVES TO SUCCEED IN RESPECT OF THIS GRO UND IN PART. IT IS SEEN THAT AS PER WILL OF LATE FATHER OF THE ASSESSEE, THE WIL L WAS EXECUTED ON 19.07.2003 BY WHICH FDR WAS CONVEYED IN THE NAME OF THE ASSESSEE. THIS WILL WAS PROBATE ON 21.3.2007. THE FDR WAS MATURED ON 20.04.2007. THE TOTAL INTEREST ON MATURITY RECEIVED BY THE ASSESSE E AT RS.3,19,588/-. OUT OF THIS INTEREST, A SUM OF RS.1,13,306/- WAS SHOWN IN THE ASSESSMENT YEAR 2007- 08 ON THE BASIS OF PROPORTIONATE INTEREST AND INTER EST OF RS.8897 WAS SHOWN DURING THE YEAR UNDER CONSIDERATION AGAIN BY STATIN G ON PROPORTIONATE BASIS. 3 IT IS SUBMITTED BY THE LD. COUNSEL FOR THE ASSESSEE THAT REMAINING PART OF INTEREST BELONGS TO ASSESSMENT YEARS 2005-06 AND 20 06-07 AND THEREFORE, THE SAME WAS SHOWN IN THE YEAR UNDER CONSIDERATION. TH ESE CONTENTIONS OF THE LD. COUNSEL FOR THE ASSESSEE, IN MY VIEW ARE NOT A CCEPTABLE. IF ASSESSEE WAS OF THE VIEW THAT THIS INTEREST SHOWN ON ACCRUAL BAS IS YEAR TO YEAR THEN INTEREST ON ACCRUAL BASIS SHOULD HAVE SHOWN IN THE YEAR 2004 -05, WHICH THE ASSESSEE HAS NOT SHOWN. REGARDING REASON FOR THE SAME, IT WA S STATED THAT PROBATE WAS ISSUED IN THE ASSESSMENT YEAR 2007-08 THEN IN MY CO NSIDERED VIEW THAT INTEREST SHOULD HAVE BEEN ASSESSED IN THE ASSESSMEN T YEAR 2007-08, WHICH THE ASSESSEE HAS FAILED TO DO. SINCE INTEREST OF R S.1,13,306/- HAS ALREADY BEEN OFFERED FOR TAXATION FOR ASSESSMENT YEAR 2007- 08, THEREFORE, TO THIS EXTENT NO ADDITION SHOULD HAVE BEEN MADE EITHER BY THE AO OR BY THE CIT(A). ACCORDINGLY, I REDUCE THE ADDITION OF RS.1, 13,306/- OUT OF TOTAL ADDITION OF RS.3,19,588/-, AS OTHERWISE IT WILL TA NTAMOUNT TO DOUBLE ADDITION. THE REMAINING AMOUNT OUT OF TOTAL INTERES T IS SUSTAINED IN THE YEAR UNDER CONSIDERATION. I ORDER ACCORDINGLY. 4. SECOND ISSUE IS AGAINST CONFIRMING THE ADDITION OF RS.45,600/- TREATING THE AGRICULTURAL INCOME AS INCOME FROM OTHER SOURCE S. THE AO TREATED THE AGRICULTURAL INCOME AS INCOME FROM OTHER SOURCES BY OBSERVING THAT THE 4 ASSESSEE HAS NOT FILED ANY EVIDENCE TO SHOW THAT AG RICULTURAL LAND IS OWNED BY THE ASSESSEE. THE LD. CIT(A) HAS ALSO CONFIRMED THE ACTION OF THE AO. 5. AFTER CONSIDERING THE ORDER OF THE CIT(A), I FOU ND NO INFIRMITY IN THE FINDINGS OF THE CIT(A) AS ASSESSEE DID NOT FILE ANY EVIDENCE IN RESPECT OF AGRICULTURAL LAND HOLDING, EVEN NO DETAIL WAS FILED HERE BEFORE THE TRIBUNAL. THUS, WITHOUT ANY EVIDENCE IN RESPECT OF HOLDING OF AGRICULTURAL LAND, ANY INCOME CANNOT BE TREATED THAT THE SAME IS OUT OF A GRICULTURAL INCOME. ACCORDINGLY, I CONFIRM THE ORDER OF THE CIT(A) ON T HIS ISSUE. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 03.01 .2012 SD/- ( R.K. GUPTA ) JUDICIAL MEMBER DATED : 03.01.2012 /SKR/ COPY FORWARDED TO :- THE ASSESSEE: SH. GOPAL SINGH, KISHANGARH. THE ITO, KISHANGARH. THE CIT (A),AJMER THE CIT, AJMER THE D/R, ITAT, JAIPUR. GUARD FILE (ITA NO. 788/JP/2011 BY ORDER, 5