DCIT, Trichy V. S.Baskaran, Trichy

ITA 926/CHNY/2013

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 68918 (ITAT-CHENNAI)
• Duration Of Justice: 7 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-12-2013
• Appeal Filed By: Department
• Bench Allotted: B
• Next Hearing Date: 09-12-2013
• Assessment Year: 2009-2010
• Appeal Filed On: 09-05-2013
• Court: TRIBUNAL
• Department Lawyers: GURU BHASHYAM
• Assessee Lawyers: S SRIDHAR
• Keywords: Condonation of delay

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : CHENNAI BEFORE DR. O.K. NARAYANAN, VICE PRESIDENT & SHRI VIKAS AWASTHY, JUDICIAL MEMBER I.T.A. NO. 926/MDS/2013 ASSESSMENT YEAR : 2009-10 THE DEPUTY COMMISSIONER OF INCOME TAX , CIRCLE I(1), TRICHY VS SHRI S. BASKARAN, NO.21, PUSHPAK NAGAR, AMMAMANDAPAM ROAD, SRIRANGAM, TRICHY 620 005 [PAN: AAEPB 2858 F] (APPELLANT) (RESPONDENT) REVENUE BY : SHRI GURU BHASHYAM, CIT-DR ASSESSEE BY : SHRI S.SRIDHAR, ADVOCATE DATE OF HEARING : 09-12-2013 DATE OF PRONOUNCEMENT : 30-12-2013 O R D E R PER VIKAS AWASTHY, JUDICIAL MEMBER: THE APPEAL HAS BEEN FILED BY THE REVENUE AGAINST TH E ORDER OF COMMISSIONER OF INCOME TAX(APPEALS), TIRUCHIRAPA LLI DATED 24-01-2013 RELEVANT TO THE ASSESSMENT YEAR (AY) 200 9-10. THE APPEAL HAS BEEN FILED WITH DELAY OF FOUR DAYS. A P ETITION PRAYING I.T.A. NO. 926/MDS/2013 :- 2 -: FOR CONDONATION OF DELAY IN FILING OF THE APPEAL HA S BEEN FILED BY THE REVENUE. WE HAVE PERUSED THE SAME AND ARE SATI SFIED THAT THE DELAY IN FILING OF THE APPEAL IS NOT INTENTIONA L OR WILLFUL, BUT IS FOR THE REASON MENTIONED IN THE PETITION FOR CONDON ATION OF DELAY. IN THE INTEREST OF JUSTICE, THE DELAY OF FOUR DAYS IN FILING OF THE APPEAL IS CONDONED. THE APPEAL IS ADMITTED TO BE H EARD ON MERITS. 2. THE REVENUE HAS RAISED TWO ISSUES IN APPEAL: I. UN-DISCLOSED INVESTMENT IN MUTUAL FUNDS; AND II. INTEREST INCOME OF ` 14,69,575/-. 3. THE BRIEF FACTS OF THE CASE ARE: THE ASSESSEE IS IN THE BUSINESS OF NON-DESTRUCTIVE TESTING SERVICES AND TR AINING UNDER THE NAME AND STYLE OF INDUSTRIAL QUALITY CONCEPTS . THE ASSESSEE FILED HIS RETURN OF INCOME FOR THE AY. 200 9-10 ON 30-09-2009 DECLARING HIS INCOME AS ` 2,57,68,409/-. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND NOTICE U /S.143(2) OF THE INCOME TAX ACT, 1961 (HEREIN AFTER REFERRED TO AS THE ACT) I.T.A. NO. 926/MDS/2013 :- 3 -: WAS ISSUED TO THE ASSESSEE. AFTER VERIFICATION OF THE DOCUMENTS AND BOOKS OF ACCOUNT OF THE ASSESSEE, THE ASSESSING OFFICER MADE ADDITIONS ON ACCOUNT OF UN-EXPLAINED INVESTMEN TS U/S.69 (INVESTMENTS IN MUTUAL FUNDS) TO THE TUNE OF ` 1,11,00,000/-, INTEREST INCOME NOT DISCLOSED ` 14,69,575/-, DIS-ALLOWANCE OF EXPENDITURE U/S.40A(3) AND DIS-ALLOWANCE OF DEPRECI ATION. AGGRIEVED AGAINST THE ASSESSMENT ORDER DATED 30-12 -2011, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(APP EALS). THE CIT(APPEALS) VIDE HIS ORDER DATED 24-01-2013, DELET ED THE ADDITION MADE U/S.69 AND INTEREST INCOME. AS REGAR DS OTHER TWO ADDITIONS, THE COUNSEL OF THE ASSESSEE DID NOT PRES S THE SAME AND THUS THE APPEAL OF THE ASSESSEE WAS PARTLY ALLO WED. AGGRIEVED AGAINST THE ORDER OF THE CIT(APPEALS) IN DELETING THE ADDITIONS, THE REVENUE HAS COME IN APPEAL BEFOR E THE TRIBUNAL. 4. SHRI GURU BHASHYAM, APPEARING ON BEHALF OF THE R EVENUE VEHEMENTLY SUPPORTING THE ORDER OF THE ASSESSING OF FICER REITERATED THE GROUNDS RAISED IN THE GROUNDS OF APP EAL. I.T.A. NO. 926/MDS/2013 :- 4 -: 5. ON THE OTHER HAND, SHRI S.SRIDHAR, APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED THAT THE ORDER OF THE CIT(AP PEALS) IS WELL REASONED AND SPEAKING AND THUS DOES NOT CALL FOR AN Y INTERFERENCE. 6. BOTH THE SIDES HEARD. THE REVENUE HAS RAISED TW O ISSUES IN ITS APPEAL. THE FIRST ISSUE RELATES TO THE ALLE GED UN-DISCLOSED INVESTMENT IN MUTUAL FUNDS. THE CASE OF THE REVENU E IS THAT THERE HAS BEEN INCREASE IN INVESTMENT IN THE MUTUAL FUNDS. HOWEVER, THE REVENUE HAS NOT BEEN ABLE TO SHOW AS T O HOW THE INVESTMENTS IN THE MUTUAL FUNDS HAVE BEEN MADE AND THE CORRESPONDING CASH FLOW FOR MAKING SUCH INVESTMENT. WE FIND THAT, IN FACT THERE HAS BEEN NO FLOW OF CASH AND TH E ASSESSEE HAS GROUPED MUTUAL FUND INVESTMENT WITH THE INTEREST FR OM FIXED DEPOSITS. THE FACT THAT THERE HAS BEEN NO CHANGE I N THE TOTAL OF BOTH INVESTMENTS HAS BEEN ADMITTED BY THE ASSESSING OFFICER. WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CI T(APPEALS). THEREFORE, NO INTERFERENCE IS CALLED FOR IN THE IMP UGNED ORDER ON THIS ISSUE. I.T.A. NO. 926/MDS/2013 :- 5 -: 7. THE SECOND ISSUE IN APPEAL IS INTEREST INCOME OF ` 14,69,575/-. THE CIT(APPEALS) IN HIS ORDER HAS CAT EGORICALLY STATED THAT THE INTEREST AMOUNTING TO ` 14,69,575/- IS ATTRIBUTABLE TO THE INTEREST COMPONENT IN EEFC FIXED DEPOSITS TO TH E TUNE OF `1 ,37,35,578/-. THE LD.DR HAS NOT BEEN ABLE TO CONTR OVERT WITH THE FINDINGS OF THE CIT(APPEALS). WE FIND NO REASO N TO INTERFERE WITH THE IMPUGNED ORDER. THERE IS NO MERIT IN THE APPEAL OF THE REVENUE. THE SAME IS DISMISSED BEING DEVOID OF MER ITS. ORDER PRONOUNCED ON MONDAY, THE 30 TH DECEMBER, 2013 AT CHENNAI. SD/- SD/- (DR. O.K. NARAYANAN) (VIK AS AWASTHY) VICE PRESIDENT JUDICIAL MEMBER DATED: 30 TH DECEMBER, 2013 TNMM COPY TO: APPELLANT/RESPONDENT/CIT(A)/CIT/DR