Mrs Sharada Shivaji Mane, Pune V. Deputy Commissioner of Income-Tax, Central Circle -1, Aurangabad

ITSSA 102/PUN/2022

AI Insights

The case involves two assessees, Mrs. Sharada Shivani Mane and Mrs. Shantabai Gundappa Mane, who appealed against the orders of the CIT(A), Pune-12, which upheld the assessment orders passed by the DCIT under sections 153C and 143(3) of the Income Tax Act, 1961. The primary contention was the rejection of their eligibility for the presumptive taxation scheme under Section 44AD. The Tribunal noted that the assessees did not appear for multiple hearings and had not provided sufficient evidence to substantiate their claims of business activities. The Tribunal also addressed procedural issues raised by the assessees regarding the jurisdiction and the manner of assessment, which were found to be without merit.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 137307 (ITAT-PUNE)
• Duration Of Justice: 7 month(s) 3 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 15-05-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 14-05-2023
• Assessment Year: 2015-2016
• Appeal Filed On: 12-10-2022
• Other Referred Cases: Commissioner of Customs vs. Dilip Kumar [2018] 9 SCC 1 (SC) (FB)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 44AD; 143(3); 153C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “B” : PUNE BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND DR. DIPAK P. RIPOTE, ACCOUNTANT MEMBER I.T.(S.S.)A.Nos.102 & 103/PUN./2022 Assessment Years 2015-2016 & 2016-2017 Mrs. Sharada Shivani Mane, Flat No.201, Boston Apartment, Near Royalty Party, Prabhat Road, Gymkhana, Pune - 411 004 Maharashtra. PAN BQQPM8522E vs. The DCIT, Central Circle-1, Aayakar Bhavan, Opp. Holy Cross English High School, Aurangabad. Maharashtra. PIN - 431 002 (Appellant) (Respondent) I.T.(S.S.)A.Nos.104 & 105/PUN./2022 Assessment Years 2015-2016 & 2016-2017 Mrs. Shantabai Gundappa Mane, Flat No.601, Boston Apartment, Near Royalty Party, Prabhat Road, Gymkhana, Pune - 411 004 Maharashtra. PAN BJCPM6401P vs. The DCIT, Central Circle-1, Aayakar Bhavan, Opp. Holy Cross English High School, Aurangabad. Maharashtra. PIN - 431 002 (Appellant) (Respondent) For Assessees : -None- For Revenue : Shri M.G. Jasnani Date of Hearing : 15.05.2023 Date of Pronouncement : 16.05.2023 ORDER PER BENCH : The instant batch of four cases pertains to twin assessees herein namely Mrs. Sharada Shivaji Mane and Mrs. Shantabai Gundappa Mane. Their two appeals each i.e., 2 I.T.(S.S.)A.Nos.102 to 105/PUN./2022 Mrs. Sharada Shivani Mane & Mrs. Shantabai Gundappa Mane, Pune I.T.(S.S.)A.Nos.102 & 103/PUN./2022 [former] along with latter’s as many cases I.T.(S.S.)A.Nos.104 & 105/PUN./2022, arise against the CIT(A), Pune-12’s separate Dins & Order Nos. ITBA/APL/S/250/2022-23/1046144958(1), 1046145302(1) and 1046143617(1), 1046144080(1), all dated 30.09.2022, respectively, involving proceedings u/s.153C r.w.s. 143(3) of the Income Tax Act, 1961 (in short “the Act”). Cases called twice. None appears at both these assessees’s behest. They are, therefore, proceeded ex-parte. 2. A combined perusal of all these four case files reveals that way back on 10.02.2023, this bench had put both these assessees’ on notice for rejecting their eligibility to be assessed at the presumptive scheme of taxation u/s.44AD of the Act in light of the learned lower authorities’ detailed findings going against them. Learned counsel had quoted this tribunal’s common order in I.T.(S.S.)A.Nos.106 & 107/PUN./ 2022 in alleged connected cases dated 31.01.2023 that no disallowance could be made in an instance wherein an assessee chooses to be assessed u/s.44AD of the Act. We invited learned counsel’s attention to the CIT(A)'s identical lower appellate detailed discussion holding these assessees’ to have failed in proving the actual business activity(ies) carried- out as under : 3 I.T.(S.S.)A.Nos.102 to 105/PUN./2022 Mrs. Sharada Shivani Mane & Mrs. Shantabai Gundappa Mane, Pune 4 I.T.(S.S.)A.Nos.102 to 105/PUN./2022 Mrs. Sharada Shivani Mane & Mrs. Shantabai Gundappa Mane, Pune 5 I.T.(S.S.)A.Nos.102 to 105/PUN./2022 Mrs. Sharada Shivani Mane & Mrs. Shantabai Gundappa Mane, Pune 6 I.T.(S.S.)A.Nos.102 to 105/PUN./2022 Mrs. Sharada Shivani Mane & Mrs. Shantabai Gundappa Mane, Pune 3. The identical common notings in all these case files suggest that learned counsel representing these two assessees’ sought time to prepare the instant cases afresh. Neither the learned counsel has appeared thereafter nor these twin assessees’ have turned-up despite the fact that we have waited for them on 02.03.2023, 09.03.2023, 21.03.2023, 10.04.2023, 27.04.2023, 10.05.2023 and 15.05.2023 i.e., today. It rather emerges that both these assessees’ have preferred to file representations before the hon’ble President, Income-tax Appellate Tribunal and hon’ble Vice President, Income-tax Appellate Tribunal, Pune Zone, Pune seeking to de-hear the instant four appeals by leveling accusations of perversity against us. We strongly deprecate their behavior hereinabove; But at the same time, since there is no reason for us to release 7 I.T.(S.S.)A.Nos.102 to 105/PUN./2022 Mrs. Sharada Shivani Mane & Mrs. Shantabai Gundappa Mane, Pune the instant case files so as to succumb to “bench-shopping” as per the foregoing observations, we proceed to decide the assessees’ identical substantive grounds pleaded in [I.T.(S.S.)A.No.102/ PUN./2022] these four appeals reading as under : 1. “On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in upholding the assessment order passed by the Ld. A.O. u/s 153C of the Income Tax Act, 1961. The assessment u/s 153C is invalid, bad in law and without jurisdiction. 2. On the facts and circumstances of the case and in law, the Ld. CIT(A) had erred by approving the addition/ disallowance made by the Ld. A.O. of Rs. 71,29,920/- inspite of no incremental material found during the course of search from the premises of Manisha Construction Company. 3. The Manisha Construction Company had filed an application before settlement commission u/s 245C of the I.T. Act, 1961 on 05/02/2020 and order for the same was passed u/s 245D(1) of the I. T. Act, 1961 on 13/02/2020 by the settlement commission. The notice issued u/s 153C by the Ld. A.O. is bad in law because as per section 245F all exclusive powers of Ld. A.O. are transferred to 8 I.T.(S.S.)A.Nos.102 to 105/PUN./2022 Mrs. Sharada Shivani Mane & Mrs. Shantabai Gundappa Mane, Pune settlement commission for issuance of notice and passing the assessment order. Therefore the notice issued u/s 153C and order passed by the Ld. A.O. is bad in law since the jurisdiction lies with settlement commission and not the Ld. A.O. 4. On the facts and circumstances of the case and in law, the Ld. A.O. has erred by taking common approval for all the years i.e. A.Y. 2013-14 to A.Y. 2018- 19 which is in violation of provisions of section 153D. 5. On the facts and circumstances of the case and in law the Ld. A.O. has erred by recording common satisfaction note for all the years i.e. AY 2013-14 to A.Y. 2018-19. 6. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in upholding the addition/ disallowance made by the Ld. A.O. of Rs.71,29,920/- being expenditure claimed u/s.44AD of the Income Tax Act 1961, without considering the facts of the case. 7. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in not following the provision of section 44AD of the Act since the section is presumptive section and appellant is not required to maintain books of account and it is presumed to have made expenses of 80% of the income received (20% profit shown by assessee u/s 44AD). 9 I.T.(S.S.)A.Nos.102 to 105/PUN./2022 Mrs. Sharada Shivani Mane & Mrs. Shantabai Gundappa Mane, Pune 8. On facts and circumstances of the case the Ld. CIT(A) has not considered the submission filed on record at all and had proceeded with preset minds of making addition. 9. The appellant craves leave to add, alter, amend or modify any or all grounds till the disposal of the Appeal.” 4. We make it clear that learned counsel representing the assessees’ had not pressed the assessees’ ground nos. 1 to 5 and 8 to 9 during the course of hearing way back on 10.02.2023. The only distinction in all these cases is that of the amount of expenditure sum(s). So far as his arguments that this tribunal has already deleted similar expenditure disallowance in an instance involving sec.44AD presumptive scheme of assessment, we make it clear that there is no material or evidence filed before us in any of these four case files resulting CIT(A)'s detailed discussion holding the assessees as not to have carried-out any business activity or sub-contract works in the impugned assessment years. We are thus constrained to observe that this tribunal finds no reason to reverse the learned lower authorities action seriously doubting the assessees’ action seeking to avail the presumptive scheme taxation benefit u/s.44AD of the Act. Faced with the situation, we adopt stricter construction in light of Commissioner of Customs vs. Dilip Kumar [2018] 9 10 I.T.(S.S.)A.Nos.102 to 105/PUN./2022 Mrs. Sharada Shivani Mane & Mrs. Shantabai Gundappa Mane, Pune SCC 1 (SC) (FB) to hold that these assessees’ have been rightly denied the benefit of impugned beneficial scheme of taxation in the given facts and circumstances of the case. We accordingly reject their sole substantive arguments in all these four appeals challenging expenditure disallowance of Rs.71,29,920/-; Rs.73,98,240/- and Rs.68,08,960/-; Rs.67,34,000/-, case-wise, respectively. The CIT(A)’s lower appellate findings in all these four cases stand upheld. 5. These twin assessees’ as many appeals I.T.(S.S.)A.Nos.102 & 103/PUN./2022 and I.T.(S.S.)A.Nos.104 & 105/PUN./2022 are accordingly dismissed in above terms. A copy of this common order be placed in the respective case files. Order pronounced in the open Court on 16.05.2023. Sd/- Sd/- [DR. DIPAK P. RIPOTE] [SATBEER SINGH GODARA] ACCOUNTANT MEMBER JUDICIAL MEMBER Pune, Dated 16 th May, 2023 VBP/- Copy to 1. The appellant 2. The respondent 3. The Ld. CIT(A), Pune-12 Pune. 4. The Pr. CIT (Central), Nagpur. 5. D.R. ITAT, Pune “B” Bench, Pune 6. Guard File. //By Order// Assistant Registrar, ITAT, Pune Benches, Pune.