DCIT, V. Chethan P. Thayal,

ITA 928/BANG/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 8631 (ITAT-BANGALORE)
• Duration Of Justice: 2 year(s) 8 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-02-2016
• Appeal Filed By: Department
• Bench Allotted: B
• Next Hearing Date: 02-02-2016
• Assessment Year: 2004-2005
• Appeal Filed On: 12-06-2013
• Court: TRIBUNAL
• Assessee Lawyers: SUNDAR HEGDE K
• Keywords: Tax effect
• Section: 153A; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE B BENCH, BANGALORE BEFORE SHRI ABRAHAM P GEORGE, ACCOUNTANT MEMBER AND SHRI VIJAYPAL RAO, JUDICIAL MEMBER ITA NOS.1062(BNG.)/2013 (ASSESSMENT YEAR : 2004-05) SHRI CHETAN PRAKASH TAYAL, NO.205, SALEH ARCADE, LEONARD LANE, BANGALORE PAN NO.ADQPT2127G APPELLANT VS THE DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-2(3), BANGALORE RESPONDENT AND ITA NO.928(BNG)/2013 (ASSESSMENT YEAR : 2004-05) SHRI CHETAN PRAKASH TAYAL, NO.205, SALEH ARCADE, LEONARD LANE, BANGALORE APPELLAN T VS THE DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-2(3), BANGALORE RESPONDENT ASSESSEE BY : SHRI SUNDAR HEGDE, K. CA REVENUE BY : SMT NEERA MALHOTRA, CIT DATE OF HEARING : 02-02-2016 DATE OF PRONOUNCEMENT : 10-02-2016 O R D E R PER SHRI ABRAHAM P GEORGE, AM; THESE ARE APPEALS FILED BY THE ASSESSEE AND REVENUE DIRECTED AGAINST AN ORDER DATED 05-02-2013 OF CIT(A), MYSORE. 2. THE APPEAL OF THE ASSESSEE IS TAKEN UP FIRST FOR DISPOSAL. 2 ITA NOS.1062 & 928(B)/13 2.1 GRIEVANCE RAISED BY THE ASSESSEE THROUGH ITS GR OUND NOS. 1 TO 4 ARE THAT THE ADDITION OF RS.7.00 LAKHS MADE BY THE AO, DISBELIEVING ADVANCES RECEIVED FROM ONE MR. KUNDRAS, WAS CONFIRMED BY THE CIT(A). 3. FACTS APROPOS ARE THAT THE ASSESSEE HAVING INCOM E FROM SALARY AND HOUSE PROPERTY WAS SUBJECT TO A SEARCH U/S 132 OF T HE IT ACT, 1961 ON 31-01- 2008. PURSUANT TO A NOTICE U/S 153A OF THE IT ACT, 1961 ASSESSEE FILED RETURN DECLARING AN INCOME OF RS.1,55,680/-. ASSESSEE HA D CLAIMED LOANS FROM ONE SHRI KUDDUS RS.7.00 LAKHS, ONE SHRI AGARWAL RS.5.00 LAKHS, ONE SHRI GUPTA RS.10.60 LAKHS AND ONE SHRI NAGENDRA RS.5.00 LAKHS. SINCE THESE WERE NEW LOANS THE AO REQUIRED THE ASSESSEE TO PROVE THE GEN UINENESS AND CREDIT WORTHINESS OF THE CREDITORS. EXCEPT FOR A CONFIRMA TION LETTER FROM ONE SHRI HARISH, NOTHING WAS FILED BY THE ASSESSEE. THE ASS ESSMENT WAS COMPLETED THEREAFTER, BY MAKING AN ADDITION OF RS.27,60,000/- BEING AGGREGATE OF THE ABOVE AMOUNTS. 4. AGGRIEVED, THE ASSESSEE MOVED IN APPEAL BEFORE THE LEARNED CIT(A). THE ARGUMENT OF THE ASSESSEE WAS THAT HE WAS THE MA NAGING DIRECTOR OF M/S BHARAT HI-TECH BUILDERS (P)LTD. AND HAD FILED CONFI RMATION LETTERS FROM EACH OF THE FOUR PARTIES. THE LEARNED CIT(A) CALLED FOR A REMAND REPORT FROM THE AO. IN THE REMAND REPORT, THE AO RE-AFFIRMED HIS EARLIER V IEW EXCEPT FOR THE MONEY BORROWED FROM SHRI NAGENDRAN. LEARNED CIT(A) AFTER CONSIDERING THE REMAND 3 ITA NOS.1062 & 928(B)/13 REPORT AND SUBMISSIONS OF THE ASSESSEE WAS OF THE O PINION, THAT THE ASSESSEE COULD NOT PROVE THE GENUINENESS OF THE LOAN OF RS.7 .00 LAKHS CLAIMED TO HAVE RECEIVED FROM MR. KHUDUS. AS PER THE LEARNED CIT(A ) ASSESSEE COULD PROVE THE GENUINENESS OF THE BALANCE LOANS. HE DELETED THE A DDITION TO THE EXTENT OF RS.20,60,000/-. 5. NOW BEFORE US THE LEARNED AR SUBMITTED THAT SHRI KHUDUS HAD APPEARED BEFORE THE AO DURING THE COURSE OF REMAND PROCEEDINGS AND CONFIRMED THE FACTUM OF ADVANCE OF RS.7.00 LAKHS GIVEN TO THE ASSESSEE. ACCORDING TO HIM, JUST BECAUSE SHRI KHUDUS MENTIONED THAT HE WAS ONLY AN INTERMEDIARY, THE GENUINENESS OF THE LOAN COULD NOT BE DISBELIEVED. THUS, ACCORDING TO HIM, THE LOAN FROM SHRI KHUDUS WAS SUBSTANTIATED BY THE ASSE SSEE AND THE ADDITION REQUIRED TO BE DELETED. 6. PER CONTRA, LEARNED DR SUPPORTED THE ORDER OF TH E LEARNED CIT(A). 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RECORDS. 8. IN THE STATEMENT RECORDED FROM SHRI KHUDUS, ON 1 6-11-2011 HE HAD MENTIONED THAT HE WAS ONLY ACTING AS INTERMEDIARY A ND NEVER ADVANCED ANY SUMS TO THE ASSESSEE. HE HAD ALSO STATED THAT THE SIGNATURES ON CERTAIN PAPERS 4 ITA NOS.1062 & 928(B)/13 WERE TAKEN BY THE ASSESSEE. HOWEVER, IT SEEMS AN O PPORTUNITY TO CROSS EXAMINE SHRI KHUDUS, WAS NOT GIVEN TO THE ASSESSEE. THERE WERE NO ENQUIRIES CONDUCTED BY THE AO ON THE STATEMENT OF SHRI KHUDUS THAT HE WAS ACTING AS INTERMEDIARY. WE ARE OF THE OPINION, THAT THE QUES TION WHETHER THE LOAN OF RS.7.00 LAKHS CLAIMED TO HAVE BEEN RECEIVED FROM SH RI KHUDUS IS GENUINE OR NOT REQUIRES FURTHER VERIFICATION BY THE LOWER AUTHORIT IES. WE THEREFORE, SET ASIDE THE ORDERS OF THE LOWER AUTHORITIES ON THIS ISSUE AND R EMIT BACK TO THE AO FOR CONSIDERATION AFRESH IN ACCORDANCE WITH LAW. 9. NOW WE TAKE UP THE APPEAL OF THE REVENUE. THE B ENCH POINTED OUT TO THE LEARNED DR THAT THE TAX EFFECT IN THE REVENUES APPEAL WAS LESS THAN RS.10.00 LAKHS, SINCE THE ADDITIONS WHICH WERE DELE TED BY THE CIT(A) AND WHICH HAVE BEEN ASSAILED BY THE REVENUE WAS RS.15,60,000/ - ONLY. IN VIEW OF CIRCULAR NO.21/2015 DATED 10TH DECEMBER, 2015 THIS APPEAL HAS TO BE DISMISSED FOR LOW TAX EFFECT. 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES, WHEREAS THAT OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 10 TH FEBRUARY, 2016. SD/- SD/- ( VIJAYPAL RAO ) ( ABRAHAM P GEORGE ) JUDICIAL MEMER ACCOUNTANT MEMBER BANGALORE: D A T E D : 10-02-2016 AM 5 ITA NOS.1062 & 928(B)/13 COPY TO : APPELLANT RESPONDENT CIT(A)-IV, BANGALORE. CIT DR, ITAT, BANGALORE. GUARD FILE (1+1) ASST. REGISTRAR ITAT, BANGALORE