Smt. S.Padmini, CHENNAI V. ITO, Pondicherry

ITA 875/CHNY/2011

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 7742 (ITAT-CHENNAI)
• Duration Of Justice: 10 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-04-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 02-04-2012
• Assessment Year: 2003-2004
• Appeal Filed On: 12-05-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, CHENNAI BEFORE DR. O.K.NARAYANAN, VICE-PRESIDENT AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER ITA NO. 875/(MDS)/2011 ASSESSMENT YEAR : 2003-04 SMT. S. PADMINI, C/O M/S. SUBBARAYA AIYAR PADMANABHAN & RAMAMANI ADVOCATES, NEW NO.75A (OLD NO.105A), DR. RADHAKRISHNAN SALAI, MYLAPORE, CHENNAI 4. VS. THE INCOME-TAX OFFICER, WARD-I(1), PONDICHERRY. PAN ALBPP 0149 F (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SAR OJ KUMAR PARIDA, ADVOCATE RESPONDENT BY : SHRI S. MOHA RANA, IRS, COMMISSIONER OF INCOME-TAX DATE OF HEARING : 2 ND APRIL, 2012 DATE OF PRONOUNCEMENT : 2 ND APRIL, 2012 O R D E R PER DR. O.K. NARAYANAN, VICE-PRESIDENT THIS APPEAL IS FILED BY THE ASSESSEE. THE RELEVAN T ASSESSMENT YEAR IS 2003-04. THE APPEAL IS DIRECTED AGAINST THE ITA 875/1 1 :- 2 -: ORDER OF THE COMMISSIONER OF INCOME-TAX(APPEALS)-XI I AT CHENNAI DATED 1.3.2011 AND ARISES OUT OF THE ASSESSMENT CO MPLETED UNDER SEC. 143(3) OF THE INCOME-TAX ACT, 1961. 2. THE FIRST GROUND RAISED BY THE ASSESSEE IS THAT THE COMMISSIONER OF INCOME-TAX(APPEALS) HAS ERRED IN DI SPOSING THE APPEAL EX PARTE, WITHOUT GIVING AN OPPORTUNITY TO T HE ASSESSEE OF BEING HEARD. THE SECOND GROUND IS THAT THE COMMISS IONER OF INCOME-TAX(APPEALS) HAS ERRED IN CONFIRMING THE DIS ALLOWANCE OF `6,30,150/-, BEING EXPENDITURE ON ACCOUNT OF REPAIRS, TAXES, INTEREST AND OTHER MAINTENANCE CHARGES. IT IS THE CASE OF THE ASSESSEE THAT THE COMMISSIONER OF INCOME-TAX(APPEAL S) OUGHT TO HAVE APPRECIATED THAT THE ASSESSEE HAS FURNISHED ALL THE DETAILS PERTAINING TO THE ABOVE EXPENDITURE BEFORE THE ASSE SSING OFFICER AS WELL AS BEFORE THE COMMISSIONER OF INCOME-TAX(AP PEALS) IN THE COURSE OF HEARING. THE PRAYER OF THE ASSESSEE IS T HAT THE SAID EXPENDITURE MAY BE ALLOWED AS A DEDUCTION. 3. SHRI SAROJ KUMAR PARIDA, THE COUNSEL APPEARING F OR THE ASSESSEE ARGUED AT LENGTH. HE SUBMITTED THAT THE DETAILS OF THE EXPENDITURE AMOUNTING TO ` 6,30,150/- WERE FURNISHED BEFORE THE ITA 875/1 1 :- 3 -: ASSESSING AUTHORITY, AS CERTIFIED BY A QUALIFIED EN GINEER WHO HAS GIVEN THE DETAILS OF WORK RELATING TO THE INCIDENC E OF THOSE EXPENDITURE. IT IS IN SPITE OF THE EVIDENCES PRODU CED BEFORE HIM THAT THE ASSESSING OFFICER HAS MADE SUCH DISALLOWAN CE AND DENIED THE DEDUCTION TO THE ASSESSEE. THE COUNSEL FURTHER CONTENDED THAT THE COMMISSIONER OF INCOME-TAX(APPEA LS) HAS PASSED THE ORDER, EX PARTE, WITHOUT HEARING THE ASS ESSEE AND HAS MECHANICALLY UPHELD THE ORDER PASSED BY THE ASS ESSING OFFICER. IT IS, THEREFORE, HIS CASE THAT EITHER TH E TRIBUNAL MAY EXAMINE THE VERACITY OF THE CLAIM OF EXPENDITURE MA DE BY THE ASSESSEE AND ALLOW THE SAME AS A DEDUCTION OR AT LE AST REMAND THE CASE BACK TO THE COMMISSIONER OF INCOME-TAX(APP EALS) FOR DE NOVO CONSIDERATION OF THE ISSUE WITH AN OPPORTUNITY TO THE ASSESSEE OF BEING HEARD. 4. SHRI S. MOHARANA, THE LEARNED COMMISSIONER OF IN COME-TAX APPEARING FOR THE REVENUE CONTENDED THAT THE COMMIS SIONER OF INCOME-TAX(APPEALS) HAD GIVEN UMPTEEN NUMBER OF OPP ORTUNITIES TO THE ASSESSEE TO APPEAR BEFORE HIM AND PRESENT T HE CASE. BUT NONE OF THE OPPORTUNITIES WAS UTILIZED BY THE ASSES SEE. IT WAS IN THOSE CIRCUMSTANCES THAT THE COMMISSIONER OF INCOME - ITA 875/1 1 :- 4 -: TAX(APPEALS) HAS PROCEEDED TO DISPOSE OF THE APPEAL EX PARTE. BUT, STILL THE COMMISSIONER OF INCOME-TAX(APPEALS) HAS CONSIDERED THE VARIOUS CONTENTIONS RAISED BY THE AS SESSEE ON MERITS AND EXAMINED THE MATERIALS AVAILABLE ON RECO RD. HE HAS COME TO A CONCLUSION AS A FINDING OF FACT THAT THE ASSESSEE HAD NOT PROVED BEFORE THE ASSESSING OFFICER THAT THE EX PENDITURE WAS INCURRED IN CARRYING ON HER BUSINESS. REGARDING TH E ORDER OF THE ASSESSING AUTHORITY, IT IS THE ARGUMENT OF THE LEAR NED COMMISSIONER THAT EVEN THOUGH THE ASSESSEE HAS FILE D A CERTIFICATE FROM A QUALIFIED ENGINEER TO SUPPORT TH E INCIDENCE OF THE EXPENDITURE, NO DETAILS WERE FURNISHED BEFORE T HE ASSESSING OFFICER. THEREFORE, THE CLAIM MADE BY THE ASSESSEE WAS NOT PROVED. HE, THEREFORE SUBMITTED THAT THE APPEAL FI LED BY THE ASSESSEE IS LIABLE TO BE DISMISSED. 5. WE HEARD BOTH SIDES IN DETAIL AND CONSIDERED THE MATTER. IT IS TRUE THAT THE ASSESSEE HAD FILED FOUR BILLS BEFO RE THE ASSESSING AUTHORITY ON 28.3.2006. THE BILLS WERE ISSUED BY O NE SHRI V.R.AJIT CHANDIRAN, A QUALIFIED ENGINEER, AS PER WHICH THE A MOUNTS OF EXPENDITURE ARE AS FOLLOWS : ITA 875/1 1 :- 5 -: S.NO. BILLS DATED AMOUNT 1. 27-1-2003 ` 2,36,150 2. 14-2-2003 ` 1,50,000 3. 15-3-2003 ` 1,62,500 4. 27-3-2003 ` 66,500 TOTAL ` 6,30,150 6. THE ASSESSING OFFICER NOTICED FROM THE ABOVE DET AILS THAT THEY DO NOT CARRY ANY SERIAL NUMBER OR DETAILS OF W ORK OR MODE OF PAYMENTS. THE ASSESSEE WAS ASKED TO PRODUCE THE D ETAILS REGARDING THE DIFFERENT WORKS STATED TO BE CARRIED OUT BY THE ENGINEER. SHE WAS ALSO DIRECTED TO PRODUCE THE REC EIPT OF HIRE CHARGES FROM THE PROPERTY IN RESPECT OF WHICH THE E XPENSES WERE STATED TO HAVE BEEN INCURRED FOR REPAIRS AND MAINTE NANCE. IT IS CLEAR FROM THE ORDER OF THE ASSESSMENT THAT EXCEPT FURNISHING THE BREAK-UP OF THE BILL AMOUNTS, THE ASSESSEE HAS NOT FURNISHED ANY DETAILS AND PARTICULARS OR EVIDENCES BEFORE THE ASS ESSING OFFICER. THE ASSESSEE HAS FILED ONLY THE ARITHMETICS OF EXPE NDITURE CLAIMED BY HER. SHE HAS GIVEN THE DATE OF BILLS AN D THE BILL AMOUNT AND TOTAL OF THE BILL AMOUNTS. OBVIOUSLY, I T IS NOT SUFFICIENT. THE ASSESSEE SHOULD EXPLAIN BEFORE THE ASSESSING OFFICER THAT THE EXPENSES WERE INCURRED FOR SUCH AN D SUCH ITA 875/1 1 :- 6 -: PURPOSE AND THEY WERE INCURRED IN RESPECT OF SUCH A ND SUCH PROPERTY AND THOSE EXPENSES WERE INCURRED FOR SUCH AND SUCH REASON. THE ASSESSEE SHOULD ALSO PRODUCE THE DETAI LS OF ESTIMATE, DETAILS OF MATERIALS PURCHASED, MODE OF P AYMENTS ETC. IT IS TO BE SEEN THAT THE ASSESSEE HAS RETURNED AN INCOME OF ` 5,05,401/-, FOR WHICH THE ASSESSEE HAS CLAIMED REPA IRS AND OTHER EXPENDITURE OF ` 6,30,150/-. LOOKING INTO THE SIZE OF THE BUSINES S OF THE ASSESSEE, THE AMOUNT CLAIMED BY THE ASSESSEE AS DEDUCTION IS EXORBITANT. THE ASSESSEE HAS GOT AN O NEROUS RESPONSIBILITY TO CONVINCE THE ASSESSING AUTHORITY THAT THE EXPENDITURE WERE INCURRED AND THEY WERE INCURRED FO R THE PURPOSE OF BUSINESS. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE ASSESSIN G OFFICER DISALLOWING THE CLAIM OF EXPENDITURE OF ` 6,30,150/-. 7. REGARDING THE EX PARTE ORDER OF THE COMMISSIONER OF INCOME-TAX(APPEALS), IT IS OUR CONSIDERED OPINION T HAT THE ASSESSEE HAD NOT APPEARED BEFORE THE COMMISSIONER OF INCOME- TAX(APPEALS) IN SPITE OF A NUMBER OF OPPORTUNITIES GRANTED TO HER. EVEN THOUGH THE COMMISSIONER OF INCOME-TAX(APPEALS) HAS PASSED THE ORDER, EX PARTE, IT IS TO BE SEEN THAT H E HAS EXAMINED ITA 875/1 1 :- 7 -: ALL THE ASPECTS OF THE CASE AND PASSED A SPEAKING O RDER, TOUCHING UPON VARIOUS ASPECTS OF THE ISSUE. THEREFORE, THE ORDER OF THE COMMISSIONER OF INCOME-TAX(APPEALS) CANNOT BE HELD TO BE ARBITRARY OR UNJUST. 8. IN RESULT, THIS APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED ON MONDAY , THE OF 2 ND OF APRIL , 2012 AT CHENNAI. SD/- SD/- (CHALLA NAGENDRA PRASAD) (DR.O.K.NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI, DATED THE 2 ND APRIL, 2012 MPO* COPY TO : APPELLANT/RESPONDENT/CIT/CIT(A)/DR