Balaji Foundation, CHENNAI V. ITO, Virudhunagar

ITA 939/CHNY/2015

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 7826 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 9 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 28-12-2016
• Assessment Year: 2004-2005
• Appeal Filed On: 27-04-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: R DURAI
• Assessee Lawyers: S SRIDHAR
• Keywords: Unexplained expenditure
• Section: 133A

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, CHENNAI . . . , . . , BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER ./ ITA NOS. 940 & 939/MDS/2015 / ASSESSMENT YEARS : 2005-06 & 2004-05 M/S. BALAJI FOUNDATION, C/O SHRI S. SRIDHAR, ADVOCATE, NEW NO.14, OLD NO.82, FLAT NO.5, 1 ST AVENUE, INDIRA NAGAR, ADYAR, CHENNAI 600020. PAN : AAFFB3039D V. THE INCOME TAX OFFICER WARD I(1), VIRUDHUNAGAR. ( /APPELLANT) ( !' /RESPONDENT) # /APPELLANT BY : SHRI S. SRIDHAR, ADVOCATE !' # /RESPONDENT BY : SHRI R. DURAIPANDIAN, SR. AR. # /DATE OF HEARING : 28.12.2016 # /DATE OF PRONOUNCEMENT : 31.01.2017 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER : BOTH THE APPEALS OF THE ASSESSEE ARE DIRECTED AG AINST THE COMMON ORDER PASSED BY THE COMMISSIONER OF INCOME T AX (APPEALS)-3, MADURAI DATED 06.03.2015 AND PERTAINS TO THE ASSESSMENT YEARS 2004-05 & 2005-06. 2 I.T.A. NO. 940 & 939/MDS/2015 2. SHRI S. SRIDHAR, THE LD. COUNSEL FOR THE ASSESSE E SUBMITTED THAT THE ASSESSEE ENGAGED ITSELF IN THE BUSINESS OF REAL ESTATE. THERE WAS A SURVEY IN THE PREMISES OF THE ASSESSEE. DURING THE SURVEY OPERATION, ACCORDING TO THE LD. COUNSEL THE REVENUE AUTHORITIES FOUND CERTAIN MATERIAL AND IMPOUNDED TH E SAME. AS PER THE IMPOUNDED DOCUMENT, THE ASSESSING OFFICER FOUND THE SALE VALUE OF THE PLOTS WAS 90,12,000/- FOR THE ASSESSMENT YEAR 2005- 06 AND WHAT WAS DISCLOSED BY THE ASSESSEE IN THE RE TURN OF INCOME WAS 70,21,321/-. THE BALANCE OF 19,04,321/- WAS CONSIDERED AS SUPPRESSION OF SALE VALUE OF THE PLOTS. SIMILARLY , THERE WAS DIFFERENCE BETWEEN THE SALE PRICE SHOWN IN THE RETU RN OF INCOME FOR THE ASSESSMENT YEAR 2004-05 AND SALE CONSIDERATION DISCLOSED IN THE DOCUMENT IMPOUNDED. DURING THE COURSE OF SURV EY OPERATION, SALES WAS DETERMINED AS 88,44,673/- AND THE SAME WAS CONSIDERED AS SUPPRESSION OF SALE BY THE ASSESSING OFFICER. ACCORDING TO THE LD. COUNSEL, THE ASSESSING OFFICER HAS NOT REFERRED THE DOCUMENTS IMPOUNDED DURING THE COURSE OF SURVEY OPERATION FOR DETERMINING THE SALE CONSIDERATION OVER AND ABOVE W HICH WAS DISCLOSED BY THE ASSESSEE IN THE RETURN OF INCOME. REFERRING TO THE ORDER OF THE CIT (APPEALS), THE LD. COUNSEL FOR THE ASSESSEE 3 I.T.A. NO. 940 & 939/MDS/2015 SUBMITTED THAT THE IMPOUNDED DOCUMENT HAS ALSO DISC LOSED THE EXPENDITURE INCURRED BY THE ASSESSEE FOR SALE OF LA ND. THE ASSESSING OFFICER CONVENIENTLY HAS TAKEN THE SALE C ONSIDERATION IN THE IMPOUNDED DOCUMENT AND OMITTED TO REFER TO THE EXPENDITURE DISCLOSED IN THE VERY SAME IMPOUNDED DOCUMENT. TH EREFORE, ACCORDING TO THE LD. COUNSEL FOR THE ASSESSEE, THE ORDERS OF THE LOWER AUTHORITIES MAY BE SET ASIDE AND THE ASSESSIN G OFFICER MAY BE DIRECTED TO RE-EXAMINE THE MATTER ON THE BASIS O F THE MATERIAL AVAILABLE ON RECORD. 3. ON THE CONTRARY, SHRI R. DURAIPANDIAN, THE LD. D EPARTMENTAL REPRESENTATIVE SUBMITTED THAT ADMITTEDLY THERE WAS A SURVEY OPERATION IN THE PREMISES OF THE ASSESSEE UNDER SEC TION 133A OF THE INCOME TAX ACT, 1963 (IN SHORT THE ACT). THE DOCUMENTS FOUND IN THE COURSE OF SURVEY OPERATION WAS SALE DEEDS AN D OTHER PAPERS CONTAINING DETAILS OF ACTUAL SALE VALUE COLLECTED B Y THE ASSESSEE. THE ASSESSEE HAS ACCOUNTED ONLY THE SALE CONSIDERAT ION DISCLOSED IN THE REGISTERED SALE DEED. THE EXCESS MONEY COLL ECTED BY THE ASSESSEE OVER AND ABOVE THE SALE CONSIDERATION IN T HE SALE DEED WAS NOT INCLUDED OR ACCOUNTED IN THE BOOKS OF ACCOU NT. HOWEVER, THE MATERIAL IMPOUNDED DURING THE COURSE OF SURVEY OPERATION 4 I.T.A. NO. 940 & 939/MDS/2015 DISCLOSED THE DETAILS OF ON-MONEY RECEIPT OVER AND ABOVE THE SALE CONSIDERATION DISCLOSED IN THE SALE DEED. THE ASSE SSING OFFICER IN FACT CONFRONTED WITH THE ASSESSEE, THE MATERIAL FOU ND DURING THE COURSE OF SURVEY OPERATION. THE ASSESSING OFFICER FURTHER FOUND THAT ALL THE EXPENSES WERE ALREADY DEBITED TO PROFI T AND LOSS ACCOUNT IN THE ORIGINAL RETURN FILED BY THE ASSESSEE BEFORE THE DATE OF SURVEY. DURING THE COURSE OF SURVEY, NO DETAILS OF EXPENDIT URE WHICH WERE NOT ACCOUNTED IN THE BOOKS OF ACCOUNT ARE FOUND. REFERRING TO PAGE 7 OF THE IMPUGNED ORDER OF THE CIT (APPEALS), MORE PARTICULARLY PARA 7.4, THE LD. D.R., SUBMITTED THAT DURING THE COURSE OF HEARING BY THE CIT (APPEALS), THE ASSESSEES AUTHORIZED REPRESENTA TIVE CLARIFIED THAT NO MATERIAL WAS AVAILABLE IN THE IMPOUNDED DOC UMENT FOR THE EXPENDITURE SAID TO BE INCURRED BY THE ASSESSEE. THEREFORE, THE CLAIM OF THE ASSESSEE, NOW BEFORE THIS TRIBUNAL THA T THE EXPENDITURE INCURRED IN THE IMPOUNDED DOCUMENT WAS NOT CONSIDER ED IS NOT CORRECT. HAD THERE BEEN AN EXPENDITURE REFERRED I N THE IMPOUNDED DOCUMENT, THE REPRESENTATIVE OF THE ASSESSEE WOULD NOT HAVE SUBMITTED BEFORE CIT (APPEALS) THAT THERE WAS NO MA TERIAL FOUND DURING THE COURSE OF SURVEY OPERATION. 5 I.T.A. NO. 940 & 939/MDS/2015 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE MATERIAL AVAILABLE ON RECORD. ADMITTED LY, THERE WAS A SURVEY OPERATION UNDER SECTION 133A OF THE ACT IN T HE PREMISES OF THE ASSESSEE AND SEVERAL INCRIMINATING MATERIALS WE RE FOUND BY THE REVENUE AUTHORITIES. THERE WAS A DIFFERENCE BETWE EN THE SALE CONSIDERATION DISCLOSED IN THE RETURN OF INCOME AND THE SALE CONSIDERATION REFERRED IN THE DOCUMENTS FOUND DURIN G THE COURSE OF SURVEY OPERATION. THE DIFFERENCE BETWEEN THE SALE CONSIDERATION DISCLOSED IN THE RETURN OF INCOME AND THE ONE FOUND IN THE MATERIAL DURING THE COURSE OF SURVEY OPERATION WAS CONSIDERE D AS SUPPRESSION OF SALE VALUE BY THE ASSESSING OFFICER. ACCORDINGLY, THE SAME WAS ADDED TO THE TOTAL INCOME. THE ASSESS EE NOW CLAIMS BEFORE THIS TRIBUNAL THAT THERE ARE CERTAIN EXPENDI TURES INCURRED BY THE ASSESSEE FOR SALE OF THE PLOTS WHICH WAS ALSO R EFEREED IN THE VERY SAME IMPOUNDED DOCUMENT. THE LD. COUNSEL SUBM ITTED THAT IF THE EXPENDITURE REFERRED IN THE IMPOUNDED DOCUMENT WAS CONSIDERED THEN THERE MAY NOT BE ANY DIFFERENCE. 5. WE HAVE CAREFULLY GONE THROUGH THE ORDERS OF BOT H THE AUTHORITIES BELOW. DURING THE COURSE OF APPEAL PRO CEEDING, THE CIT (APPEALS) SPECIFICALLY ASKED THE AUTHORIZED REPRESE NTATIVE OF THE 6 I.T.A. NO. 940 & 939/MDS/2015 ASSESSEE WHETHER THERE WAS ANY EVIDENCE FOR THE SO CALLED EXPENDITURE CLAIMED BY THE ASSESSEE IN THE IMPOUNDE D MATERIAL. THE AUTHORIZED REPRESENTATIVE CLARIFIED THAT NO SUC H EXPENDITURE WAS REFERRED IN THE IMPOUNDED MATERIAL. FOR THE PU RPOSE OF CONVENIENCE, WE ARE REPRODUCING PARA 7.4 & 7.5 OF THE IMPUGNED ORDER OF THE CIT (APPEALS). WITH REGARD TO THE EXPENSES ON REAL ESTATE BUSINESS , ALL THE EXPENSES WERE ALREADY DEBITED TO THE PROFIT AND LOS S ACCOUNT IN THE ORIGINAL RETURNS FILED BEFORE THE SURVEY. DURING THE COURSE OF SURVEY NO DETAILS OF EXPENSES WHICH WERE NOT ACCOUNTED IN THE BOOKS WAS FOUND. DURING THE COURSE OF APPEALS AUTHORIZED REPRESENTATIVE WAS SPE CIFICALLY ASKED WHETHER ANY EVIDENCE FOR THE EXPENSES CLAIMED IN APPEAL LIK E EVICTION OF UNAUTHORIZED OCCUPANTS PAYMENT TO LOCAL SHEETS/VIPS , PAYMENT TO DOCUMENT WRITES, ON TRANSPORT EXPENSES, INCUMBRANCE CERTIFICATE EXPENSES FOR OBTAINING COPIES ETC WAS AVAILABLE IN THE IMPOUNDED MATERIALS FOR WHICH THE ANSWER WAS IN THE NEGATIVE. THIS IS A CASE WHERE EVIDENCE WAS FOUND WITH REGA RD TO RECEIPT OF ON MONEY (UNACCOUNTED) BUT NO EVIDENCE WAS FOUND WI TH REGARD TO UNACCOUNTED EXPENDITURE OVER AND ABOVE WHAT IS DEBI TED TO THE PROFIT AND LOSS ACCOUNT. THIS OBSERVATION OF THE CIT (APPEALS) IS VERY CLEAR THAT EVEN THE REPRESENTATIVE FOR THE ASSESSEE ADMITTED THAT T HERE WAS NO MATERIAL IN THE IMPOUNDED DOCUMENT FOR CLAIMING THE EXPENDITURE. THEREFORE THE CLAIM OF THE LD. COUNSEL FOR THE ASSE SSEE, NOW 7 I.T.A. NO. 940 & 939/MDS/2015 BEFORE THIS TRIBUNAL THAT THE EXPENDITURE WAS REFER RED IN THE IMPOUNDED DOCUMENT WAS NOT CORRECT. IN VIEW OF TH E ABOVE, THIS TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH T HE ORDER OF THE LOWER AUTHORITY. ACCORDINGLY, THE SAME IS CONFIRM ED. 6. IN THE RESULT BOTH THE APPEALS OF THE ASSESSEE S TANDS DISMISSED. ORDER PRONOUNCED ON 31 ST JANUARY, 2017 AT CHENNAI. SD/- SD/- ( . . ) ( . . . ) (D.S. SUNDER SINGH) (N.R.S. GANESAN) / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, /DATED, THE 31 ST JANUARY, 2017. JR. # ! $ % $ /COPY TO: 1. /APPELLANT 2. !' /RESPONDENT 3. &' ( )/CIT(A)-3,MADURAI 4. &' /CIT, MADURAI 5. ! $ /DR 6. () /GF.