Appeal Details
Counselvise Citation
[2015] 140 COUNSELVISE.COM (IT) 99823 (ITAT-KOLKATA)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
1 year(s) 4 month(s) 13 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
28-09-2015
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
B
Assessment Year
2007-2008
Appeal Filed On
15-05-2014
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH B KOLKATA BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ITA NO. 966 / KOL / 2014 ASSESSMENT YEAR :2007-08 GOURIDUTT ISWARDAS JALAN CHARITABLE TRUST 6/7A, A.J.C.BOSE ROAD, KOLKATA 700 017 [ PAN NO.AAATG 2304D ] V/S . INCOME TAX OFFICER,- E(1), 10B, MIDDLETON ROW, KOLKATA 700 017 /APPELLANT .. / RESPONDENT /BY APPELLANT SHRI K.M. ROY, FCA /BY RESPONDENT SHRI ARINDAM BHATTACHARJEE, ADDL.CIT-DR /DATE OF HEARING 21-09-2015 /DATE OF PRONOUNCEMENT 28-09-2015 / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER:- THIS APPEAL BY THE ASSESSEE IS ARISING OUT OF ORD ER OF COMMISSIONER OF INCOME TAX (APPEALS)-XIV, KOLKATA IN APPEAL NO.283/ CIT(A)-XIV/KOL./09-10 DATED 12.03.2014. ASSESSMENT WAS FRAMED BY ITO (EXE MP)-I, KOLKATA U/S 143(3)/13(1)(D)/13(1)(C) OF THE INCOME TAX ACT, 196 1 (HEREINAFTER REFERRED TO AS THE ACT) VIDE HIS ORDER DATED 24.12.2009 FOR A SSESSMENT YEAR 2007-08. MR. K.M. ROY, FCA APPEARING ON BEHALF OF ASSESSEE A ND MR. ARINDAM BHATTACHARJEE, ADDL. CIT-DR APPEARING ON BEHALF OF REVENUE. ITA NO.966/KOL/2014 A.Y. 2007-08 GIJCT V. ITO-E(I) KOL. PAGE 2 2. ISSUE RAISED BY ASSESSEE IN ITS APPEAL IS THAT L D. CIT(A) HAS ERRED IN CONFIRMING THE ORDER OF ASSESSING OFFICER ON ACCOUN T OF DISALLOWANCE OF RS.3.75 LAKH U/S 13(1)(C)/(D) OF THE ACT. 3. BRIEFLY STATED FACTS ARE THAT ASSESSEE IS A CHAR ITABLE TRUST AND HAVING REGISTRATION U/S 12 OF THE ACT. THE LD AO FOUND THA T THE ASSESSEE-TRUST HAS PAID AN ADVANCE OF RS.3.75 LAKH FOR PURCHASE OF A F LAT TO M/S MITHUA DEVELOPERS PVT. LTD. THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS COULD NOT PRODUCE THE RELEVANT DOCUMENT S REGARDING THE ADVANCE FOR THE PURCHASE OF FLAT. THE ASSESSING OFFICER ALS O NOTED THAT THE TRUSTEE OF THE ASSESSEE-TRUST MR. AMITABH JALAN IS ALSO A DIR ECTOR OF THE SAID COMPANY - M/S MITHUA DEVELOPERS PVT. LTD. IN THE ABSENCE OF A NY SUPPORTING EVIDENCE FOR THE ADVANCE OF FLAT, THE LD. AO HAS DISALLOWED THE MONEY (RS.3.75 LAKH) PAID TO THE M/S MITHUA DEVELOPERS PVT. LTD. FOR THE REAS ON OF VIOLATING THE PROVISIONS OF SEC. 13(1)/(D) OF THE ACT. HENCE, TH E LD. AO HAS ADDED THE INCOME OF ASSESSEE. AGGRIEVED, ASSESSEE PREFERRED APPEAL BEFORE LD. CIT (A). BEFORE LD. CIT(A) ASSESSEE DEMONSTRATED THAT RS.3.75 LAKH WAS PAID TO M/S MITHUA DEVELOPERS PVT. LTD. FOR PURCHASE OF SAID FLAT AND IT WAS NOT A DEPOSIT MADE BY IT IN VIOLATION OF THE RESTRICTIONS LAID IN SECTION 11(5) OF THE ACT. THE ASSESSEE ALSO SUBMITTED THAT MR. AMITABH JALAN, TRUSTEE OF THE AS SESSEE-TRUST IS A DIRECTOR IN THE SAID COMPANY BUT DOES NOT HAVE SIGNIFICANT STAK E IN THE COMPANY AS PER STIPULATION LAID DOWN IN SEC. 13(1)(D) OF THE ACT. HOWEVER, LD. CIT(A) HAS DISREGARDED THE CLAIM OF ASSESSEE AND UPHELD THE OR DER OF AO. AGGRIEVED, ASSESSEE IS IN SECOND APPEAL BEFORE US. 4. WE HAVE HEARD RIVAL CONTENTIONS OF THE PARTIES A ND PERUSED THE MATERIALS AVAILABLE ON RECORD. WE FIND IN ASSESSMEN T ORDER THAT AO HAS DISALLOWED THE CLAIMED OF THE ASSESSEE FOR THE ADV ANCE PAID OF RS. 3.75 LAKH, FOR THE PURCHASE OF FLAT. THE AO TREATED THIS ADVA NCE AS DEPOSIT WHICH IS VIOLATING THE CONDITIONS LAID DOWN UNDER SECTION 11 (5) OF THE ACT. SO THE ITA NO.966/KOL/2014 A.Y. 2007-08 GIJCT V. ITO-E(I) KOL. PAGE 3 DISALLOWANCE HAS TAKEN PLACE. HOWEVER ASSESSEE DEMO NSTRATED BEFORE LD. CIT(A) THAT SAID TRANSACTION IS OUT OF THE PURVIEW OF SEC. 13(1)(D) OF THE ACT AS THE STAKE OF THE TRUSTEE IN THE COMPANY IS NOT SIGN IFICANT. HOWEVER, WE NOTICED THAT THE ORDER OF LD. CIT(A) IS SILENT ON THE CONTE NTION OF ASSESSEE THAT MR. AMITABH JALAN IS NOT HOLDING THE SIGNIFICANT INTERE ST IN THE SAID COMPANY AS REQUIRED UNDER SECTION 13(1)(C) OF THE ACT. A PLAIN READING OF SECTION 13(1)(C) GOES AS UNDER : SECTION 13.(1) NOTHING CONTAINED IN SECTION 11 [OR SECTION 12], SHALL OPERATE SO AS TO EXCLUDE FROM THE TOTAL INCOME OF T HE PREVIOUS YEAR OF THE PERSON IN RECEIPT THEREOF- (A) (B) (BB) [***] (I) (II) IF ANY PART OF SUCH INCOME OR ANY PROPERTY OF THE TRUST OR THE INSTITUTION (WHENEVER CREATED OR ESTABLISHED) IS DU RING THE PREVIOUS YEAR USED OR APPLIED, DIRECTLY OR INDIRECTLY FOR THE BENEFIT OF ANY PERSO N REFERRED TO IN SUB-SECTION (3): (2) .. (3) THE PERSONS REFERRED TO IN CLAUSE OF SUB-SECT ION (1) AND SUB-SECTION (2) ARE THE FOLLOWING, NAMELY:- (A) THE AUTHOR OF THE TRUST OR THE FOUNDER OF THE INSTITUTION; (B) ANY PERSON WHO HAS MADE A SUBSTANTIAL CONTRIBU TION TO THE TRUST OR INSTITUTION, [THAT IS TO SAY, ANY PERSON WHOSE TOTA L CONTRIBUTION UP TO THE END OF THE RELEVANT PREVIOUS YEAR EXCEEDS [FIFTY] THOUSAND RUPEES] WHERE SUCH AUTHOR, FOUNDER OR PERSON IS A HINDU UNDIVIDED FAMILY, A MEMBER OF THE FAMILY; [(CC) ANY TRUSTEE OF THE TRUST OR MANAGER (BY WHAT EVER NAME CALLED) OF THE INSTITUTION;] (D) ANY RELATIVE OF ANY SUCH AUTHOR, FOUNDER, PERS ON, [MEMBER, TRUSTEE OR MANAGER] AS AFORESAID; (E) ANY CONCERN IN WHICH ANY OF THE PERSONS REFERR ED TO IN CLAUSES (A), (B) (C) [,(CC)] AND (D) HAS A SUBSTANTIAL INTEREST. ' FROM THE AFORESAID SECTION, IT IS CLEAR THE INTERES T OF THE TRUSTEE IN THE AFORESAID SAID COMPANY NEEDS TO BE ESTABLISHED. BUT THE ORDER OF THE LD. CIT(A) IS SILENT ON THIS POINT. THEREFORE, WE ARE O F THE VIEW THAT THIS FACT NEEDS ITA NO.966/KOL/2014 A.Y. 2007-08 GIJCT V. ITO-E(I) KOL. PAGE 4 TO BE EXAMINED BY LD. CIT(A). THEREFORE, WE SET ASI DE THE ORDER OF LD. CIT(A) WITH A DIRECTION TO EXAMINE THE CONTENTION OF ASSES SEE THAT MR. AMITABH JALAN IS NOT HOLDING THE SIGNIFICANT SHAREHOLDING IN THE ABOVE STATED COMPANY WHERE THE MONEY WAS DEPOSITED FOR PURCHASE OF SAID FLAT. HENCE, THIS GROUND OF ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOS E. 5. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED FOR STA TISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT 28/09/2015 SD/- SD/- (MAHAVIR SINGH) (WASEEM AHMED) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) KOLKATA, *DKP - 28/09/2015 / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT-GOURIDUTT ISWARDAS JALAN CHARITABLE TR UST, 6/7A, A.J.C. BOSE ROAD, KOLKATA 7 00 071 2. / RESPONDENT-ITO-E(I), 10B, MIDDLETON ROW, KOLKATA -700 071 3. - 0 / CONCERNED CIT KOLKATA 4. 0- / CIT (A) KOLKATA 5. 2 55-, -, / DR, ITAT, KOLKATA 6. 9 / GUARD FILE. BY ORDER/ , /TRUE COPY/ / -,
