M/s Akhilesh Garg H.U.F, Kanpur V. Asstt. Commissioner of Income Tax-I, Kanpur

ITA 90/LKW/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 92195 (ITAT-LUCKNOW)
• Duration Of Justice: 1 year(s) 5 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-07-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 15-06-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 17-02-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: PUNEET KUMAR
• Keywords: Principle of natural justice

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.90/LKW/2014 ASSESSMENT YEAR:2008 - 2009 C.I.T.(A) - II, KANPUR. VS M/S AKHILESH GARG HUF 15/79, CIVIL LINES, KANPUR. PAN:AAFHA3010D (RESPONDENT) (APPELLANT) SHRI SWARAN SINGH, C. A. APPELLANT BY SHRI PUNEET KUMAR, D. R. RESPONDENT BY 15/06/2015 DATE OF HEARING 17 /07/2015 DATE OF PRONOUNCEMENT O R D E R PER A. K. GARODIA, A.M. THIS IS ASSESSEES APPEAL DIRECTED AGAINST THE ORDER PASSED BY LEARNED CIT(A) - II, KANPUR DATED 26/12/2013 FOR THE ASSESSMENT YEAR 2008 - 2009. 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER: 1. THAT THE ORDER OF LD. C.I.T.(APPEALS) - II, KANPUR IN APPEAL NO. CIT(AO - II/418/ACIT - I/10 - 11/350 DATED 26.12.2013 IS INSUPPORTABLE IN LAW AND ON FACTS THEREFORE, DESERVES TO BE QUASHED. 2. THAT THE LD. C.I.T. (APPEALS) - II, KANPUR HAS ERRED IN LAW AND ON FACTS IN MISUNDERSTANDING THE FACTS RELATING TO MAHE SH NARAIN GARG, HUF, SURVIVING MEMBERS OF THE SAID HUF AFTER THE DEATH OF MAHESH NARAIN GARG ETC. AND ERRONEOUSLY COMING TO THE CONCLUSION THAT M/S. MAHESH NARAIN GARG HUF HAD CEASED TO EXIST ON THE DEATH OF LATE MAHESH NARAIN GARG. 2 3. THAT THE LD. CIT(AP PEALS) - II, KANPUR HAS ALSO ERRED IN LAW AND ON FACTS IN HOLDING THAT INCOME OF M/S. MAHESH NARAIN GARG H.U.F. FROM BUSINESS OF ITS PROPRIETORSHIP CONCERN HAS BEEN RIGHTLY ADDED TO THE INCOME OF SHRI AKHILESH GARG HUF (APPELLANT). 4. THAT THE LD. C.I.T.(AP PEALS) - II, KANPUR MISDIRECTED HIMSELF IN ARBITRARILY COMING TO A CONCLUSION THAT AFTER THE DEATH OF LATE MAHESH NARAIN GARG FATHER OF SMT. ANJANA GARG, MEMBER OF MAHESH NARAIN GARG HUF NEITHER DEMANDED THE PARTITION OF HUF NOR HAS BEEN INTERESTED IN THE BU SINESS BEING RUN BY THE SAID HUF, THEREFORE, THE INCOME OF MAHESH NARAIN GARG HUF HAS RIGHTLY BEEN CLUBBED IN THE HANDS OF THE APPELLANT AKHILESH GARG HUF. 5. THAT THE ADDITIONS/DISALLOWANCES SUSTAINED BY THE LD. CIT(APPEALS) - II, KANPUR ARE CONTRARY TO TH E FACTS ON RECORD AND PRINCIPLES OF NATURAL JUSTICE AND IN ANY CASE MUCH TOO HIGH AND EXCESSIVE. 6. THAT ANY OTHER RELIEF OR RELIEFS AS YOUR HONOUR MAY DEEM FIT IN THE FACTS AND CIRCUMSTANCES OF THE CASE, BE GRANTED. 3. IT WAS SUBMITTED BY LEARNED A.R. OF THE ASSESSEE THAT THIS ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE TRIBUNAL ORDER IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2006 - 07 AND 2007 - 08 IN I.T.A. NO.147 & 148 OF 2011 DATED 30/06/2011, COPY OF WHICH IS AVAILABLE ON PAGES 14 TO 28 OF THE PAPER BOOK. IN PARTICULAR, OUR ATTENTION WAS DRAWN TO PARA 11 OF THE TRIBUNAL ORDER AS APPEARING ON PAGES 20 AND 21 OF THE PAPER BOOK. 4. LEARNED D. R. OF THE REVENUE SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2006 - 07 AND 2007 - 08, IT WAS HELD BY THE TRIBUNAL THAT THE ASSESSING OFFICER CANNOT CONSIDER THE INCOME OF MAHESH 3 NARAIN GARG (HUF) AS INCOME OF AKHILESH GAR G (HUF) BECAUSE AKHILESH GARG WAS NOT THE ONLY SURVIVING COPARCENER OF MAHESH NARAIN GARG AS HIS ONE DAUGHTER WAS ALSO SURVIVING NAMELY SMT. ANJANA GARG, WHO WAS ALSO A COPARCENER OF MAHESH NARAIN GARG ( HUF ) . THE RELEVANT P ARA OF THE TRIBUNAL ORDER I.E. P ARA NO.11 IS REPRODUCED BELOW FOR THE SAKE OF READY REFERENCE: - 11. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND CAREFULLY GONE THROUGH MATERIAL AVAILABLE ON RECORD. IN THE PRESENT CASE, IT IS NOTICED THAT THE ASSESSING OFFICER CONSIDERE D THE INCOME OF MAHESH NARAIN GARG HUF AS AN INCOME OF AKHILESH GARG HUF SINCE AKHILESH GARG WAS THE ONLY SURVIVING SON OF MAHESH NARAIN GARG, BUT HAS NOT CONSIDERED THIS FACT THAT MAHESH NARAIN GARG WAS ALSO HAVING ONE DAUGHTER, NAMELY SMT. ANITA GARG AGA RWAL, WHO WAS ALSO A COPARCENER OF MAHESH NARAIN GARG HUF. AS PER THE HINDU SUCCESSION (AMENDMENT) ACT, 2005, DAUGHTER HAD BEEN GIVEN EQUAL RIGHT IN THE HUF AS THAT OF THE SON. THE SAID AMENDMENT ALSO MADE IT CLEAR THAT PRE - AMENDMENT POSITION SHALL PREVA IL ONLY FOR PARTITIONS ALREADY TAKEN PLACE BEFORE 20 TH DECEMBER, 2004. BUT, IN THE INSTANT CASE, THERE WAS NO PARTITION, SO THE DAUGHTER OF THE DECEASED WOULD HAVE SAME RIGHT AS THAT OF THE SON IN THE PROPERTY OF THE HUF OF HER FATHER. AS SUCH, MAHESH NA RAIN GARG HUF WAS IN EXISTENCE EVEN AFTER THE DEATH OF MAHESH NARAIN GARG HUF AND IT WAS A SEPARATE AND DISTINCT ENTITY FROM AKHILESH GARG HUF. THEREFORE, THE INCOME OF MAHESH NARAIN GARG HUF COULD NOT HAVE BEEN INCLUDED IN THE HANDS OF AKHILESH GARG HUF. IN THAT VIEW OF THE MATTER, WE ARE OF THE VIEW THAT THE LEARNED CIT(A) WAS FULLY JUSTIFIED IN DELETING THE ADDITION MADE BY THE ASSESSING OFFICER. 5.1 FROM THE ABOVE PARA FROM THE ORDER OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2006 - 07 AND 2007 - 08, IT IS SEEN THAT IT WAS HELD BY THE TRIBUNAL THAT THE INCOME OF MAHESH NARAIN GARG HUF CANNOT BE TAXED IN THE HANDS OF AKHILESH GARG HUF BECAU SE MAHESH NARAIN GARG HUF IS STILL IN EXISTENCE AFTER THE DEATH OF MAHESH NARAIN GARG ALSO. SINCE LEARNED D.R. OF THE REVENUE COULD NOT POINT OUT ANY DIFFERENCE IN FACTS IN 4 THE PRESENT YEAR, WE DO NOT FIND ANY REASON TO TAKE A CONTRARY VIEW. THEREFORE, RESPECTFULLY FOLLOWING THIS TRIBUNAL ORDER IN ASSESSEES OWN CASE, WE HOLD THAT THE INCOME OF MAHESH NARAIN GARG HUF CANNOT BE ASSESSED IN THE HANDS OF THE PRESENT ASSESSEE I.E. AKHILESH GARG HUF. THE ASSESSING OFFICER IS DIRECTED ACCORDINGLY. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS 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 MEMBER DATED: 17 /07/2015 *C.L.SINGH 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