Appeal details
Counselvise Citation
[2021] 108 COUNSELVISE.COM (IT) 9849 (ITAT-HYDERABAD)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
2 year(s) 10 month(s) 5 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
15-03-2021
Appeal Filed By
Assessee
Order Result
Partly Allowed
Bench Allotted
DB-B
Next Hearing Date
10-02-2021
Assessment Year
2013-2014
Appeal Filed On
10-05-2018
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B : HYDERABAD (THROUGH VIDEO CONFERENCE) BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER ITA NO. A.Y. APPELLANT RESPONDENT 909/HYD/18 2008 - 09 SAMUEL RAJKUMAR PATTA, SECUNDERABAD [PAN: AEWPP0538A] ASST.COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-1(1), HYDERABAD 910/HYD/18 2009 - 10 911/HYD/18 2010 - 11 912/HYD/18 2011 - 12 913/HYD/18 2012 - 13 914/HYD/18 2013 - 14 915/HYD/18 2014 - 15 FOR ASSESSEE : SHRI S.RAMA RAO, AR FOR REVENUE : SHRI Y.V.S.T.SAI & SHRI ROHIT MUJUMDAR, DRS DATE OF HEARING : 10-02-2021 DATE OF PRONOUNCEMENT : 15-03-2021 O R D E R PER BENCH : THESE ASSESSEES SEVEN APPEALS FOR ARISE FROM THE CI T(A)- 11, HYDERABADS ORDERS DATED 04-12-2017 IN CASE NO.375/2016-17/ACIT CC-1(1)/CIT(A)-11, HYD IN AY.20 08-09 INVOLVING PROCEEDINGS U/S.271(1)(C), AND FOLLOWED B Y HIS COMMON ORDER OF THE VERY DATE IN CASE NOS.08 TO 13/201 6- 17/ACIT CC-1(1)/CIT(A)-11, HYD, IN PROCEEDINGS U/S. 143(3) R.W.S.153A IN AYS.2009-10 TO 2013-14 & U/S.143(3) OF THE INCOME TAX ACT, 1961 [IN SHORT, THE ACT] FOR AY.2014- 15; RESPECTIVELY. HEARD BOTH THE PARTIES. CASE FILES PERUSED. ITA NOS. 909, 910, 911, 912, 913, 914 & 915/HYD/2018 :- 2 -: 2. IT TRANSPIRES AT THE OUTSET THAT ALL THESE ASSESSEES APPEALS SUFFER FROM IDENTICAL 52 DAYS DELAY STATED TO B E ATTRIBUTABLE TO IDENTICAL THE REASON(S) BEYOND THE CONTROL OF ASSESSEE AS PER CONDONATION PETITION(S)/AFFIDAVIT(S) AS ATTRIBUTABLE TO HIS FOREIGN VISITS IN THE RELEVANT PERIO D. NO REBUTTAL TO ALL THESE SOLEMN AVERMENTS HAS COME FROM THE DEPARTMENTAL SIDE. WE THUS CONDONE THE IMPUGNED IDENTICAL 52 DAYS DELAY OWING TO CIRCUMSTANCES BEYOND ASSESSEES CONTROL. 3. IT EMERGES FROM THE COMBINED PERUSAL OF THE ASSESS EES LATTER SIX QUANTUM APPEALS ITA NOS. 910 TO 915/HYD/201 8 THAT HE HAS SOUGHT TO REVERSE ADDITIONS TO THE TUNE OF RS.21,73,665/-, 17,01,330/-, 15,65,024/-, 15,50,975 /-, AND RS.60,46,157/- IN AYS.2009-10 TO 2013-14 AND A PAYME NT OF RS.6,77,094/- AND RS.40,34,827/- IN LAST AY.2014-15; RESPECTIVELY. THE CIT(A)S IDENTICAL DETAILED DISCUS SION TO THIS EFFECT READS AS UNDER: 3. BRIEF FACTS OF THE CASE ARE THAT, THE APPELLANT AN INDIVIDUAL AND CHAIRMAN OF M/S. INTERNATIONAL OUTREACH, A CHARITAB LE & RELIGIOUS TRUST AND PASTOR OF KING'S TEMPLE CHURCH, PATIGADDA , BEGUMPET, HYDERABAD. HE IS ALSO ONE OF THE DIRECTORS IN MIS. INFINITY PUBLICATIONS P LTD., A COMPANY ENGAGED IN PUBLICATION OF BOOKS. THE APPELLANT DERIVES INCOME FROM PREACHING AND OFFERINGS FROM TH E FOLLOWERS OF CHURCH, FILED HIS RETURN OF INCOME ON 11.08.2008 DE CLARING TOTAL INCOME OF RS.1,51,760/-. A SEARCH & SEIZURE OPERATI ON WAS CONDUCTED ON 26.02.2014 IN THE RESIDENCE CUM OFFICE OF M/S. INTERNATIONAL OUTREACH. AS PER THE DOCUMENTS FOUND, VARIOUS FOREIGN BANK ACCOUNTS MAINTAINED BY THE APPELLANT AND ALSO JOINTLY WITH HIS WIFE SMT. MERLYN MANJULA PATTA WERE NOTICED. DURING THE ASSESSMENT PROCEEDINGS THE AO VIDE LETTER DT.16.12.2015 AND SH OW-CAUSE LETTER DT.11.0 1.20 16, ASKED TO PROVIDE COMPLETE INFORMAT ION IN RESPECT OF THE VARIOUS BANK ACCOUNTS. THE APPELLANT REQUESTED THE AO TO TREAT ALL THE WITHDRAWALS FROM THE SAID ACCOUNTS AS EXPEN SES INCURRED. FOR THE YEAR UNDER CONSIDERATION THE DEPOSITS IN THE AC COUNTS WERE TO THE ITA NOS. 909, 910, 911, 912, 913, 914 & 915/HYD/2018 :- 3 -: EXTENT OF RS.14,31,425/-. THE AO COMPLETED THE ASSE SSMENT BY ESTIMATING THE 30% OF THE AMOUNT DEPOSITED I.E. RS. 4,29,428 (30% OF RS.14,31,426) IN BANK ACCOUNTS WAS SPENT IN RELATIO N TO THE INCOME EARNED AND THE BALANCE 70% OF THE DEPOSITS MADE I.E RS.10,01,998/- (70% OF RS.14,31,426) WAS ASSESSED AS UNDISCLOSED I NCOME FOR THE A.Y-2008-09. 4. AGGRIEVED BY THE AO'S ACTION, THE APPELLANT IS I N APPEAL WITH THE FOLLOWING GROUNDS FOR THE A.YRS.2009-10 TO 2013-14 (COMMON GROUNDS) WHICH ARE AS UNDER: 1.THE ORDER OF THE LEARNED AO IS ERRONEOUS AND NOT BASED ON THE. FACTS OF THE CASE. 2. THE AO HAS FAILED TO GIVE CREDIT FOR THE INCOME DECLARED IN THE ROIS FILED IN USA WHICH SHOULD HAVE BEEN CONSIDERED AND THE SA ME SHOULD HAVE BEEN DEDUCTED FROM THE MONIES CREDITED IN US BANKS. 3. ANY OTHER GROUND THAT MAY BE URGED AT THE TIME O F HEARING IN ADDITION TO THE ABOVE GROUNDS, THE FOLLOWING GRO UNDS ARE ALSO RAISED FOR THE FOLLOWING YEARS: FOR THE A.Y 2009-10: '4. THE LEARNED AO HAS WRONGLY ADDED AN AMOUNT OF R S.21,73,665/- BEING THE FD ACCOUNT OF THE ASSESSEE HELD IN USA UPTO THE PERIOD ENDED 2005-06 AND HENCE OUTSIDE THE SCOPE OF BLOCK ASSESSMENT AND THEREFORE DOES NOT PARTAKE THE CHARACTER OF INCOME. 5.THE LEARNED AO HAS WRONGLY ADDED AN AMOUNT OF RS. 126500/-(1000 DIRHAMS) BEING AMOUNT GIVEN TO ANIL MATHEW OUT OF T HE FOREIGN BANK ACCOUNT HELD BY THE ASSESSEE WHICH DOES NOT PARTAKE THE CHARACTER OF INCOME AS THE AO HAS ALREADY TREATED THE DEPOSITS I NTO THE BANK ACCOUNT AS INCOME AND FURTHER THIS PAYMENT WAS MADE IN THE F.Y.2013-14 RELEVANT TO A.Y 2014-15 BUT THE SAME DOES NOT PERTAIN TO F.Y 2008-09 RELEVANT TO A.Y-2009-10. FOR THE A.Y 2014-15: 6. THE LEARNED AO HAS IGNORED THE FACT THAT THE ADD ITIONS OF RS.69607556/- BEING THE UNDISCLOSED INCOME HAS ALREADY BEEN MADE IN M/ S. INTERNATIONAL OUTREACH(TRUST) FOR THE A.Y- 2014-15 AS THE SAID SU M IS DISCLOSED IN THE HANDS OF INTERNATIONAL OUTREACH AND HENCE THE SAID SUM CANNOT BE TAXED TWICE. 7. THE LEAMED AO HAS TAKEN AN AMOUNT OF RS.904741/- BEING THE NET CREDITS IN ACCOUNT NO. 1101257518603- UMM SUQEIM BRANCH AND AGAIN A SIMILAR AMOUNT OF RS. 904741/- BEING THE CREDITS IN SPECIAL CURRENT ACCOUNT ITA NOS. 909, 910, 911, 912, 913, 914 & 915/HYD/2018 :- 4 -: AMOUNTING TO RS.904741/- WHICH MEANS THAT SAME AMOU NT IS TAKEN TWICE FOR ADDITIONS IN THE A.Y-2014-15 AND THE SAID AMOUN TS ARE INCLUDED IN THE ADDITION OF RS.4939568/-. 5. DURING THE COURSE OF APPELLATE PROCEEDINGS, SRI N.VENKATARAM, C.A. APPEARED AND FILED SUBMISSIONS, WHICH ARE COMMON IN NATURE, FOR ALL YEARS INVOLVED IN THESE APPEALS. 6. GROUNDS 1&3 ARE GENERAL IN NATURE WHICH DO NOT R EQUIRE SPECIFIC ADJUDICATION. 7. THE ASSESSEE BY WAY OF THE GROUND NO.2 HAS RAISE D THE ISSUE THAT HE IS ENTITLED TO CREDIT FOR THE INCOME DECLARED IN THE RETURN OF INCOME IN USA AND ACCORDINGLY CONTENDED THAT THE INCOME IN RESPECT OF MONEYS CREDIT IN VARIOUS BANKS SHOULD NOT BE TAKEN INTO CONSIDERATION. IN THIS REGARD, HE HAS FILED THE DET AILS OF INCOME RETURNED IN USA AND COPIES OF THE RETURNS WERE ALSO FILED BEFORE THE AO. 7.1 IN THIS REGARD, IT IS RELEVANT HERE TO BRING OU T THE RELEVANT PROVISIONS WHEREIN THE ASSESSEE CAN CLAIM BENEFIT O F INCOME SHOWN IN USA. THE RELEVANT PROVISION IS ARTICLE-25 OF DOUBLE TAXATION AVOIDANCE AGREEMENT (DTAA) BETWEEN INDIA AND USA. C LAUSE-2(A) OF THE ABOVE ARTICLE IS REPRODUCED BELOW FOR READY REF ERENCE: '2(A) WHERE A RESIDENT OF INDIA DERIVES INCOME WHIC H, IN ACCORDANCE WITH THE PROVISIONS OF THIS CONVENTION, MAY BE TAXED IN THE UNITED STATES, INDIA SHALL ALLOW AS A DEDUCT ION FROM THE TAX ON THE INCOME OF THAT RESIDENT AN AMOUNT EQUAL TO THE INCOME-TAX PAID IN THE UNITED STATES, WHETHER DIREC TLY OR BY DEDUCTION. SUCH DEDUCTION SHALL NOT, HOWEVER, EXCEE D THAT PART OF THE INCOME TAX(AS COMPUTED BEFORE THE DEDUCTION IS GIVEN) WHICH IS ATTRIBUTABLE TO THE INCOME WHICH MAY BE TA XED IN THE UNITED STATES. AS PER THE ABOVE CLAUSE, THE APPELLANT IS ENTITLED TO DEDUCTION FROM TAXES AN AMOUNT OF EQUAL TO INCOME TAX PAID IN USA AND NOT THE INCOME RETURNED. IT IS SEEN FROM THE RECORDS SUBMIT TED BY THE APPELLANT, THAT THE APPELLANT HAS FILED RETURNS JOI NTLY WITH HIS SPOUSE SMT.MERLYN MANJULA PATTA. THE INCOMES SHOWN JOINTLY BY THE APPELLANT AND SMT.MERLYN MANJULA PATTA AND TAXES PA ID ARE AS BELOW: ITA NOS. 909, 910, 911, 912, 913, 914 & 915/HYD/2018 :- 5 -: SL.NO. ASST.YEAR INCOME RETURNED IN USD TAX PAID IN USA IN USD INCOME RETURNED (IN INR) 1 2009-10 22128 0 1125873 2 2010-11 22323 424 1005205 3 2011-12 21828 0 975275 4 2012-13 21376 0 1090390 5 2013-14 20156 0 1095075 6 2014-15 20689 281 1240719 7.2. IN VIEW OF THE ABOVE IT IS HELD THAT THE APPEL LANT IS NOT ENTITLED TO ANY DEDUCTION FROM INCOME OR DEDUCTION FROM TAX IN RESPECT OF RETURNS FILED BY HIM IN USA FOR THE YEARS NOT TAXES WERE PAID. ACCORDINGLY, THE GROUND RAISED ARE REJECTED FOR AYR S.2009-10, 2011- 12, 2012-13 AND 2013-14. FOR A.YR.2010-11 CREDIT T O THE EXTENT OF USD 424 AND FOR A.Y-2014-15 CREDIT TO THE EXTENT OF USD 281 BE GIVEN THE GROUNDS ARE DISPOSED OFF WITH ABOVE DIRE CTION. 8. THE APPELLANT BY WAY OF GROUND NO.4 FOR THE A.Y- 2009-10 CONTENDED THAT THE AMOUNT OF RS.2173665/- BEING FD AMOUNT HELD BY APPELLANT FROM 2005-06 WHICH IS OUTSIDE THE SCOP E OF THE BLOCK ASSESSMENT. THE APPELLANT FILED COPY OF A/C NO.0041 3143 5689 TO CONTEND THAT THE FD WAS AVAILABLE FROM THE YEAR 200 5-06 ONWARDS. 8.1 THE ASSESSMENT ORDER, CONTENTION OF THE APPELLA NT AND THE MATERIAL PLACED BEFORE ME ARE CONSIDERED. THE MATER IAL FILED BEFORE ME RELATE TO PERIOD 26.06.2012 AND DEPOSITS AS ON 2 4.07.2012. AS THE SAME DOESN'T SHOW THAT THE FDR WAS OF EARLIER P ERIOD, THE CONTENTION OF THE APPELLANT IS REJECTED. THE AO HAS RIGHTLY COMPUTED THE DEPOSITS MADE IN THE ACCOUNTS. THE GROUND RAISE D IS REJECTED. 9. THE APPELLANT IN HIS GROUND NO.5 FOR THE A.Y-200 9-10 CONTENDED THAT ADDITION OF RS.1,26,500/- WAS GIVEN FROM DECLA RED SOURCES OF INCOME, HENCE ADDITION NOT WARRANTED AND DELETION O F AMOUNTS DECLARED IN USA FROM THE DEPOSITS IN BANK ACCOUNTS. THE APPELLANT FILED COPY OF BANK STATEMENT OF ACCOUNT NO.11012575 18603 SHOWING DEBIT OF AED 10,000 AS TRANSFER TO MR.ANIL MATHEW. 9.1 I HAVE CONSIDERED THE ASSESSMENT ORDER AND SUBM ISSION OF THE APPELLANT. IT IS SEEN THAT THE DEPOSITS IN THE ABOV E ACCOUNT HAVE BEEN CONSIDERED AS INCOME. THE DEBIT FROM THE ABOVE ACCO UNT CANNOT BE TREATED AS INCOME SEPARATELY. ACCORDINGLY, THE ADDI TION OF RS.1,26,500/- IS DELETED. ITA NOS. 909, 910, 911, 912, 913, 914 & 915/HYD/2018 :- 6 -: 10. GROUND NO.6 FOR A.YR-2014-15 IS IN RESPECT OF C HALLENGING THE ACTION OF THE AO IN TREATING AN AMOUNT OF RS.6,96,0 7,556/- AS UNDISCLOSED INCOME ON PROTECTIVE BASIS. IN THIS REG ARD, THE AO OBSERVED AS UNDER: I. THE ASSETS WERE FOUND AND SEIZED FROM THE RENTAL PREMISES BELONG TO THE CHURCH I.E M/S INTERNATIONAL OUTREACH, WHERE THE ASSESSEE STAYS, AS HE, ACCORDING TO HIM, DOES NOT HAVE HIS O WN HOUSE AND HE IS CHAIRMAN OF INTERNATIONAL OUTREACH AND ASSOCIATE D FULL TIME WITH THE CHURCH ACTIVITIES. II. AS SUBMITTED, THE PREMISES IS USED AS OFFICE OF M/S INTERNATIONAL OUTREACH, AND IT CANNOT BE SAID THAT THE ASSETS WER E FOUND AND SEIZED FROM HIS RESIDENCE. III. LOCKERS FROM WHERE FOREIGN EXCHANGE WERE FOUND AND SEIZED ARE IN THE NAME OF M/S. INTERNATIONAL OUTREACH IV. CONSIDERING THE FACTS STATED BY THE ASSESSEE DU RING ASSESSMENT PROCEEDINGS AND ALSO TAKING INTO CONSIDERATION THE AFFIDAVIT FILED BY THE ASSESSEE IN THIS REGARD, THE ASSESSEE'S VIEW TH AT THE VALUE OF THE ASSETS FOUND AND SEIZED DURING SEARCH SHOULD BE CON SIDERED AND TAXED IN THE CASE OF M/S INTERNATIONAL OUTREACH IS ACCEPTED AND A SUBSTANTIVE ADDITION ON THIS ACCOUNT WILL BE MADE I N THE CASE OF M/S INTERNATIONAL OUTREACH 3.5 HOWEVER, AS THE ASSESSEE COULD NOT FURNISH CONV INCING EXPLANATION THAT IF THE ABOVE IS THE FACT, AS TO WH Y DURING HIS STATEMENT ON OATH U/S 132(4) OF IT ACT, HE ADMITTED THE VALUE OF THE ASSETS FOUND AND SEIZED AS UNDISCLOSED INCOME IN HI S HANDS. FURTHER THOUGH THE LOCKERS WERE IN THE NAME OF M/S INTERNAT IONAL OUTREACH, IT IS THE ASSESSEE WHO WAS AUTHORIZED AND HAS BEEN OPE RATING THE SAME. FURTHER THE ASSETS WERE FOUND FROM THE PREMIS ES, MAY BE IN THE NAME OF ANYONE, WHERE ASSESSEE STAYS WITH HIS F AMILY MEMBERS. IN VIEW OF ALL THESE FACTS AND CIRCUMSTANCES, THE A SSESSEE CANNOT WASHED OFF HIS HANDS FROM HIS RESPONSIBILITY AND AC COUNTABILITY TO GIVE THE PROPER EXPLANATION I CLARIFICATION REGARDI NG HUGE ASSETS FOUND AND SEIZED WHICH WERE NOT ACCOUNTED FOR ANYWHERE. T HE ASSESSEE IS NOT ABLE TO GIVE THE PROPER DETAILS OF SOURCE OF AC QUISITION OF THESE ASSETS I.E CASH, JEWELLERY AND FOREIGN EXCHANGE. AC CORDINGLY, THE VALUE OF THE ASSETS FOUND AND SEIZED MENTIONED AS U NDER TOTALING TO RS 6,96,07,556/- IS CONSIDERED UNDISCLOSED INCOME I N THE HANDS OF THE ASSESSEE ALSO ON PROTECTIVE BASIS FOR THE A.Y- 2014-15: UNACCOUNTED INCOME BASED ON THE ASSETS FOUND AND SE IZED: ITA NOS. 909, 910, 911, 912, 913, 914 & 915/HYD/2018 :- 7 -: S.NO. NAME OF THE ASSESSEE AND PARTICULARS UNDISCLOSED INCOME COMPUTED (RS.) 1. SRU. SAMUEL RAJKUMAR PATTA FOUND IN THE CASE PREMISES AT 2 ND AND 3 RD FLOOR, ON THE ROCK APTS, 2 ND PHASE, ROAD NO.10, FILM NAGAR, JUBILEE HILLS, HYD 1.UNACCOUNTED CASH 2.UNACCOUNTED JEWELLERY 3.UNACCOUNTED FOREIGN CURRENCY WORTH OF 1,99,55,650 49,31,873 52,30,931 TOTAL 3,01,18,454 2. SRI SAMUEL RAJKUMAR PATTA (FOUND IN THE HDFC BANK LOCKERS) 1.UNACCOUNTED FOREIGN CURRENCY A.LOCKER NO.103 B.LOCKER NO.316 2.UNACCOUNTED GOLD JEWELLERY A.LOCKER NO.103 B.LOCKER NO.316 TOTAL 1,07,70,392 1,74,99,360 55,08,800 57,10,550 57,10,550 TOTAL UNDISCLOSED INCOME GRAND TOTAL: 6,96,07,556 10.1 THE APPELLANT CONTENDED THAT AS THE INCOME 'HA S BEEN OFFERED FOR THE A.Y-2014-15 AND ACCEPTED IN THE CASE OF M/S.INT ERNATIONAL OUTREACH, THE ADDITION MADE BE DELETED. 10.2 I HAVE CONSIDERED THE ASSESSMENT ORDER AND SUB MISSIONS OF THE APPELLANT. AN AMOUNT OF RS. 6,96,07,556/- HAS ALREA DY BEEN OFFERED TO TAX IN THE CASE OF M/S. INTERNATIONAL OUTREACH F OR THE A.Y-2014-15 AND THE SAME HAS BEEN TAXED. THE APPELLANT HAS NOT FILED ANY APPEAL WITH REGARD TO THE ABOVE. THE ASSESSMENT IN HIS CAS E OF M/S. INTERNATIONAL OUTREACH WITH RESPECT TO THE ABOVE IN COME HAS BECOME FINAL. IN VIEW OF THE ABOVE THE ADDITION MADE ON PR OTECTIVE BASE IN THE CASE OF THE APPELLANT IS DELETED. 11. REGARDING THE GROUND NO.7 RELATED TO A.Y-2014-1 5 THE APPELLANT CONTENDED THAT THE AO HAS TAXED AN AMOUNT OF RS.904 741/-(70% OF GROSS CREDITS INTO THE BANK ACCOUNT OF THE APPELLAN T BEARING ACCOUNT NO.1101257518603-UMM SUQEIM BRANCH AND ALSO A SIMIL AR SUM OF RS.904741/- BEING SPECIAL CURRENT ACCOUNT. IT WAS C ONTENDED THAT THE ABOVE ACCOUNT IS IN THE CATEGORY OF SPECIAL CUR RENT ACCOUNT AND THERE IS NO OTHER ACCOUNT HELD BY THE APPELLANT. 11.1 ON CONSIDERATION OF THE ASSESSMENT ORDER, THE ASSESSMENT RECORD AND THE CONTENTION OF THE APPELLANT, IT IS S EEN THAT THERE IS NO SEPARATE ACCOUNT HELD BY THE APPELLANT WHEREIN MONI ES WORTH OF RS.12,92,487/- ARE CREDITED/DEPOSITED. THE TREATMEN T OF AO RESULTED ITA NOS. 909, 910, 911, 912, 913, 914 & 915/HYD/2018 :- 8 -: IN DOUBLE ADDITION, WHICH IS LIABLE TO BE DELETED. ACCORDINGLY, THE ADDITION IS DELETED. 4. WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO RIVAL PLEADINGS AGAINST AND IN SUPPORT OF THE CORRECTNESS OF THE CIT(A)S ACTION AFFIRMING AND PARTLY UPHOLDING THE ASS ESSING OFFICERS ACTION IN ALL THESE ASSESSMENT YEARS MAKING THE IMPUGNED ADDITIONS. 5. MR. RAMA RAO INVITED OUR ATTENTION TO THE ASSESSING OFFICERS IDENTICAL ASSESSMENT ORDERS HOLDING THEREI N THAT ALTHOUGH THE ASSESSEE WAS LIABLE TO BE ASSESSED QUA THE UNDISCLOSED OVERSEAS DEPOSITS REPRESENTING HIS ALLEGE D BUSINESS INCOME IN PREACHING ACTIVITY, ONLY 30% THERE OF DESERVED TO BE ACCEPTED AS CORRESPONDING DAY TO DAY EX PENSES. HE VEHEMENTLY CONTENDED THEREFORE THAT THE ASSESSING OF FICER AS WELL AS THE CIT(A) HAVE ERRED IN LAW AND ON FACTS IN MAKING THE IMPUGNED DISALLOWANCE OF EXPENSES TO THE EXTENT OF 70% REMAINING COMPONENTS. 6. THE REVENUE DRAWS STRONG SUPPORT FROM BOTH THE LOWER AUTHORITIES ACTION MAKING THE IMPUGNED ADDITIONS IN A LL THESE ASSESSMENT YEARS. 7. WE HAVE HEARD RIVAL SUBMISSIONS. CASE(S) FILES S TAND PERUSED. THERE DOES NOT APPEAR TO BE ANY DISPUTE IN P RINCIPLE THAT THE DEPARTMENT HAD CONDUCTED A SEARCH AND SEIZURE ACTION DT.26-02-2014 IN ASSESSEES CASE THEREBY UN-EAR THING HIS OVERSEAS UNDISCLOSED INCOME WHICH CULMINATED IN INITIATION OF SECTION 153A PROCEEDINGS. THE DISPUTE, HOWEVER, BETWEEN PARTIES IS THAT QUA ALLOWING ONLY 30% OF THE ITA NOS. 909, 910, 911, 912, 913, 914 & 915/HYD/2018 :- 9 -: CORRESPONDING BUSINESS EXPENDITURE WHICH HAS RESULTE D IN THE REMAINING 70% OF THE AMOUNTS BEING ADDED IN THE ASSES SEES CASE. WE FIND IN THIS FACTUAL BACKDROP THAT NEITHER THE ASSESSEE HAS BEEN ABLE TO SUBSTANTIATE ALL THE CORRESPO NDING EXPENSES INCURRED ABROAD AS WHOLLY AND EXCLUSIVELY FOR HIS PREACHING ACTIVITY BUSINESS NOR THE ASSESSING AUTHORIT Y AS WELL AS THE CIT(A) HAVE TAKEN ANY BASIS FOR THE IMPUGNED ESTIMATION @30% ONLY. WE KEEP IN MIND ALL THESE PECU LIAR FACTS AND CIRCUMSTANCES MORE PARTICULARLY THE FACT THAT S UCH RELIGION CONGREGATIONS INDEED INVOLVE DAY TO DAY RUN NING EXPENSES AND HOLD THAT A LUMPSUM DISALLOWANCE OF 50% OF THE EXPENSES IN ALL THESE ASSESSMENT YEARS WOULD MEET THE E NDS OF JUSTICE (INCLUDING 30% ALREADY MADE) WITH A RIDER THA T THE SAME SHALL NOT BE TREATED AS A PRECEDENT IN OTHER CASE. THE ASSESSING OFFICER IS DIRECTED TO ALLOW 50% OF THE ASSE SSEES EXPENSES CLAIMED IN CONSEQUENTIAL COMPUTATION AS PER LAW WITHIN THREE EFFECTIVE OPPORTUNITIES OF HEARING THEREFO RE. 8. NEXT COMES THE SECOND ISSUE OF DISALLOWANCE OF OVE RSEAS PAYMENT OF RS.6,77,094/- MADE TO SHRI AASHISH THOMAS IN THE NATURE OF AED 36501. WE NOTICE FROM A PERUSAL OF THE CORRESPONDING ASSESSMENT ORDER DT.17-03-2016 THAT THE ASSESSEE FAILED TO SUBSTANTIATE THE SAME AS RUNNING BU SINESS EXPENDITURE WHICH HAS ALREADY BEEN ALLOWED @50%. W E THUS CONFIRM THE IMPUGNED PAYMENT DISALLOWANCE OF RS.6,77, 094/-. NO OTHER GROUNDS OR ARGUMENTS HAVE BEEN RAISED BEFOR E US. ITA NOS. 909, 910, 911, 912, 913, 914 & 915/HYD/2018 :- 10 -: 9. THE ASSESSEES INSTANT QUANTUM APPEALS ITA NOS.910 TO 915/HYD/2018 ARE PARTLY ALLOWED IN FOREGOING TERMS. 10. NEXT COMES THE ASSESSEES PENALTY APPEAL ITA NO.909/HYD/2018 IN AY.2008-09. THE SAME ADMITTEDLY PERTAINS TO UNDISCLOSED GLOBAL INCOME ADDITION OF RS.10,01,998/- COMPUTED AFTER ALLOWING ONLY 30% EXPEN DITURE AS IN AY.2009-10 TO 2014-15 (SUPRA) COMPONENT OF EXPENDITURE. WE MAKE IT CLEAR THAT ALTHOUGH THE ASSESS EE HAS NOT PREFERRED ANY QUANTUM APPEAL IN THE ABOVE BATCH DE CIDED IN PRECEDING PARAGRAPHS, THE FACT REMAINS THAT WE HAVE ALREADY ACCEPTED HIS ARGUMENTS CLAIMING 50% OF THE UNDISCLOSED INCOME AS BUSINESS EXPENDITURE THEREBY DISALLOWING THE REMAINING EQUAL COMPONENT ONLY. 11. AFTER VEHEMENTLY ARGUED AGAINST THE CORRECTNESS OF THE IMPUGNED PENALTY FOR SOME TIME, MR.RAO STATED VERY FAI RLY AT THE BAR THAT THE ASSESSEE RESTRICTS HIS CHALLENGE ONLY TO THE EXTENT OF 50% QUANTUM RELIEF GRANTED IN SIMILAR SET OF C ASES (SUPRA) ONLY. THE REVENUE FAILS TO DISPUTE THAT FACTS ARE IDENTICAL IN ALL THESE ASSESSMENT YEARS. WE THEREFORE D IRECT THE ASSESSING OFFICER TO RESTRICT THE IMPUGNED UNDISCLOSE D FOREIGN BANK ACCOUNT PENALTY OF RS.3,50,000/- TO THE EXTENT OF 5 0% ONLY AFTER GRANTING RELIEF OF EXPENSES AS AGAINST 30% ALREADY GRANTED (SUPRA) IN HIS CONSEQUENTIAL COMPUTATION. THE ASSESSEE HAS NOT PRESSED ANY OTHER FACTUAL OR LEGA L GROUNDS BEFORE US. THIS PENALTY APPEAL ITA NO.909/ HYD/2018 IS ACCEPTED IN PART THEREFORE. ITA NOS. 909, 910, 911, 912, 913, 914 & 915/HYD/2018 :- 11 -: 12. ALL THESE ASSESSEES SEVEN APPEALS ARE PARTLY ALL OWED IN FOREGOING TERMS. A COPY OF THIS COMMON ORDER BE PLACE D IN THE RESPECTIVE CASE FILES. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH MARCH, 2021 SD/- SD/- (LAXMI PRASAD SAHU) (S.S.G ODARA) ACCOUNTANT MEMBER JUDICIAL MEM BER HYDERABAD, DATED: 15-03-2021 TNMM ITA NOS. 909, 910, 911, 912, 913, 914 & 915/HYD/2018 :- 12 -: COPY TO : 1.SAMUEL RAJKUMAR PATTA, 1-8-449/4/13A, PATIGADDA, SECUNDERABAD. 2.THE ASST.COMMISSIONER OF INCOME TAX, CENTRAL CIRC LE-1(1), HYDERABAD. 3.CIT(APPEALS)-11, HYDERABAD. 4.PR.CIT(CENTRAL)-HYDERABAD. 5.D.R. ITAT, HYDERABAD. 6.GUARD FILE.
