Smt. Archana Singh, Ambedkar Nagar V. Income Tax Officer-III, Faizabad

ITA 837/LKW/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 4835 (ITAT-LUCKNOW)
• Duration Of Justice: 1 year(s) 1 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-01-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 09-11-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 20-11-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Principle of natural justice
• Section: 147

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.836/LKW/2014 ASSESSMENT YEAR 2009-10 INCOME TAX OFFICER-III, FAIZABAD VS DR. RAJENDRA PRATAP SINGH AKBARPUR, AMBEDKAR NAGAR PAN A VAP S 3499 Q ITA NO.837/LKW/2014 ASSESSMENT YEAR 2009-10 INCOME TAX OFFICER, RANGE- III, FAIZABAD VS SMT. ARCHANA SINGH R/O 204, SHASTRI NAGAR, AKBARPUR, AMBEDKAR NAGAR. PAN BKUPS 4259 J SHRI K.R. RASTOGI, CA APPELLANT BY SHRI AMIT NIGAM, DR RESPONDENT BY 09/11/2015 DATE OF HEARING 07/01/2016 DATE OF PRONOUNCEMENT O R D E R PER A. K. GARODIA, A.M. 1. BOTH THESE APPEALS ARE FILED BY TWO DIFFERENT BU T RELATED ASSESSEES AND THESE ARE DIRECTED AGAINST TWO SEPARATE ORDERS OF LD. CIT (A)-I, LUCKNOW BOTH DATED 01.09.2014 FOR AY 2009-10. 2 2. THE GROUNDS RAISED BY THE ASSESSEE IN THE CASE O F DR. RAJENDRA PRATAP SINGH IN ITA NO. 836/LKW/2014 ARE AS UNDER: (I) THAT NO ADDITION HAS BEEN MADE WITH RESPECT TO THE REASONS RECORDED, ON THE BASIS OF WHICH PROCEEDINGS U/S 147 OF I. T. ACT, HAS BEEN INITIATED. ACCORDINGLY, THE PRESENT ASSESS MENT IS VOID-AB- INITIO. (II) THE LD. C. I. T. (APPEALS)-I, LKO., ERRED ON FACTS AND IN CONFIRMING THE ADDITION OF RS. 3,71,366-00 ON ACCOUNT OF PROFE SSIONAL RECEIPT. (III) THE LD. C.L.T. (APPEALS) ERRED ON FACTS AND IN LAW IN CONFIRMING THE ADDITION OF RS. 2,54,310/- BEING PROFIT OF MEDICINE BUSINESS OF SINT. ARCHANA SINGH (WIFE) IN THE HAND OF APPELLANT. (IV) THE ADDITION MADE ARE HIGHLY EXCESSIVE, CON TRARY TO THE FACTS, LAW AND PRINCIPLE OF NATURAL JUSTICE AND WITHOUT PROVID ING SUFFICIENT TIME AND OPPORTUNITY TO HAVE ITS SAY ON THE REASONS RELI ED UPON BY HIM. 3. SIMILARLY, GROUNDS RAISED BY THE ASSESSEE SMT. A RCHANA SINGH IN ITA NO. 837/LKW/2014 ARE AS UNDER:- (I) THAT NO ADDITION HAS BEEN MADE WITH RESPECT TO THE REASONS RECORDED, ON THE BASIS OF WHICH PROCEEDINGS U/S 147 OF 1. T. ACT. HAS BEEN INITIATED, ACCORDINGLY, THE PRESENT ASSESS MENT IS VOID- AB- INITIO. (II) THE LD, C. I. T. (APPEALS) ERRED ON FACTS A ND IN LAW IN UPHOLDING THAT THE INCOME FROM THE MEDICINE BUSINESS OF THE APPELL ANT SHOULD BE TAXED IN THE HAND OF DR. R. P. SINGH (HUSBAND). 4. IT WAS SUBMITTED BY LD. AR OF THE ASSESSEE THAT GROUND NO.1 IN BOTH THESE APPEALS REGARDING REOPENING OF THE ASSESSMENT U/S 1 47 IS NOT PRESSED. ACCORDINGLY, GROUND NO.1 OF APPEAL IN BOTH THE CASES IS REJECTED . 5. REGARDING THE REMAINING GROUNDS IN BOTH THESE AP PEALS, IT WAS SUBMITTED BY LD. AR OF THE ASSESSEE THAT THESE ISSUES ARE SQUARE LY COVERED BY THE EARLIER 3 TRIBUNALS ORDER IN AY 2010-11 IN ITA NO.537/LKW/20 14 AND 538/LKW/2014 DATED 29.10.2015. HE SUBMITTED A COPY OF THIS TRIBUNALS ORDER AND POINTED OUT THAT IT WAS HELD BY THE TRIBUNAL IN THAT ORDER THAT THE INC OME ON ACCOUNT OF MEDICAL STORE IS TAXABLE IN THE HANDS OF SMT. ARCHANA SINGH AND N OT IN THE HANDS OF DR. RAJENDRA PRATAP SINGH. REGARDING THE QUANTUM OF PROFESSIONAL INCOME IN THE HANDS OF DR. RAJENDRA PRATAP SINGH, IT WAS HELD BY THE TRIBUNAL IN AY 2010-11 THAT FOR WORKING OUT THE RECEIPT OF PROFESSIONAL FEES, THE NUMBER OF PATIENTS SHOULD BE CONSIDERED AT 60 PER DAY AFTER GIVING BENEFIT OF 5 REPEAT PATIENT S PER DAY AND 5 FREE PATIENTS PER DAY AS AGAINST 70 NUMBER OF PATIENTS ADOPTED BY THE ASSESSING OFFICER FOR COMPUTING THE RECEIPT OF PROFESSIONAL FEES AND IT W AS HELD BY THE TRIBUNAL THAT THE TOTAL NUMBER OF WORKING DAYS SHOULD BE ADOPTED AT 3 00 DAYS IN THE YEAR. LEARNED DR OF THE REVENUE SUPPORTED THE ORDER OF LEARNED CI T (A). 6. WE HAVE CONSIDERED THE RIVAL SUBMISSION. WE FIND THAT IN THE PRESENT YEAR, THE A.O. HAS WORKED OUT THE TOTAL RECEIPT OF RS.10. 50 LAKH ON THIS BASIS THAT 50 PATIENTS WERE SEEN BY THE ASSESSEE PER DAY @ RS.70/ - PER PATIENT FOR 300 DAYS. AS PER THE TRIBUNALS ORDER IN ASSESSEE OWN CASE FOR A Y 2010-11, IT WAS HELD THAT TOTAL NUMBER OF PATIENTS SHOULD BE REDUCED BY 10 PATIENTS PER DAY ON ACCOUNT OF FIVE REPEAT PATIENTS PER DAY AND FIVE FREE PATIENTS PER DAY. THEREFORE, WE HOLD THAT IN THE PRESENT CASE ALSO, COMPUTATION OF PROFESSIONAL FEES SHOULD BE DONE AFTER REDUCING NUMBER OF PATIENTS BY 10 PATIENTS PER DAY AND THEREFORE, SUCH RECEIPT SHOULD BE AT RS.8.40 LAKH AS AGAINST RS.10.50 LAKH WORKED OUT BY THE ASSESSING OFFICER. THEREFORE, THE ASSESSEE GETS A RELIEF OF 2 .10 LAKH BEING AMOUNT IN RESPECT OF 10 PATIENTS PER DAY @ RS.70/- PER PATIENT FOR 30 0 DAYS IN THE YEAR. GROUND NO.2 IN ITA NO.836/LKW/2014 IS PARTLY ALLOWED. 7. GROUND NO.3 IN ITA NO.836/LKW/2014 AND GROUND NO .2 IN ITA NO.837/LKW/2014 ARE INTERCONNECTED. THESE GROUNDS A RE REGARDING TAXABILITY OF INCOME FROM MEDICINE BUSINESS. THE SAME WAS OFFERED BY THE ASSESSEE IN THE 4 HANDS OF SMT. ARCHANA SINGH BUT IT WAS TAXED BY THE ASSESSING OFFICER IN THE HANDS OF DR. RAJENDRA PRATAP SINGH. IN AY 2010-11, IT WAS HELD BY THE TRIBUNAL THAT THE INCOME OF MEDICAL STORE IS TAXABLE IN THE HANDS OF SMT. ARCHANA SINGH AND NOT IN THE HANDS OF DR. RAJENDRA PRATAP SINGH. ACCORDINGLY , IN THE PRESENT YEAR ALSO, WE HOLD THAT INCOME FROM MEDICAL STORES SHOULD BE TAXE D IN THE HANDS OF SMT. ARCHANA SINGH AND NOT IN THE HANDS OF DR. RAJENDRA PRATAP S INGH. ACCORDINGLY, GROUND NO.2 IN ITA NO.836/LKW/2014 AND GROUND NO.2 IN ITA NO. 8 37/LKW/2014 ARE ALLOWED. 8. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE PARTLY ALLOWED. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/- SD/- (SUNIL KUMAR YADAV) (A. K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBE R DATED: 07/01/2016 AKS COPY OF THE ORDER FORWARDED TO : 1.THE APPELLANT 2.THE RESPONDENT. 3.CONCERNED CIT 4.THE CIT(A) 5.D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR