DCIT, Hyderabad V. M. Sudha Rani, Hyderabad

ITSSA 11/HYD/2010

• Counselvise Citation: [2012] 124 COUNSELVISE.COM (IT) 7504 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 2 month(s) 3 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 25-05-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 21-12-2010
• Assessment Year: misc
• Appeal Filed On: 22-03-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B NAGESWAR RAO
• Assessee Lawyers: A V RAGHURAM
• Keywords: Unexplained investment; Fair market value; Block assessment
• Section: 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B, HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER IT(SS)A NO. 11/HYD/2010 BLOCK A.YS : 1997-98 TO 2002-03 AND FROM 01/04/2002 TO 21/02/2003 DY. COMMISSIONER OF INCOME-TAX, APPELLANT CENTRAL CIRCLE- 4, HYDERABAD. VS. M. SUDHA RANI, RESPONDENT HYDERABAD. (PAN - AHHPM 8832A) APPELLANT BY : MR.B. NAGESWAR RAO RESPONDENT BY : MR. A.V. RAGHURAM DATE OF HEARING : 24/04/2012 DATE OF PRONOUNCEMENT : 25/05/2012 ORDER PER ASHA VIJAYARAGHAVAN, J.M.: THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAIN ST THE ORDER OF CIT(A)-I, HYDERABAD DATED 11/01/2010 FOR THE 1997-9 8 TO 2002-03 AND FROM 01/04/2002 TO 21/02/2003. 2. THE ASSESSEE IS AN INDIVIDUAL. A SEARCH AND SEIZ URE OPERATION U/S 132 OF THE ACT WAS CONDUCTED IN THE CASE OF M.S RAJ U, PROPRIETOR OF SUMANT ART PRODUCTS, HUSBAND OF THE ASSESSEE. 3. THE ASSESSEE FILED HIS RETURN OF INCOME ON 10/11 /03 IN RESPONSE TO THE NOTICE ISSUED U/S 158BC ADMITTING NIL UNDISCLOS ED INCOME. THE ASSESSING OFFICER ISSUED NOTICE U/S 143(2) AND LATE R ON ISSUED NOTICE U/S 158BD DATED 20/02/05 ONCE AGAIN CALLING FOR RETURN OF INCOME FOR THE BLOCK PERIOD. THE ASSESSEE REPLIED TO THE NOTICE U/ S 158BD THAT FORM NO. 2B FILED EARLIER AGAINST THE NOTICE U/S 158BC MAY B E TREATED AS COMPLIANCE TO THE NOTICE U/S 158BD. THE ASSESSING OFFICER PROCEEDED TO 2 IT(SS)A NO. 11/HYD/2011 M. SUDHA RANI COMPLETE THE ASSESSMENT AND FOUND THAT DURING THE B LOCK PERIOD THE ASSESSEE HAD PURCHASED THE PROPERTIES JOINTLY WITH HER FAMILY MEMBERS. AS THE VALUE OF THE PROPERTY DECLARED BY THE ASSESS EE WAS FOUND TO BE LESS THAN THE FAIR MARKET VALUE, THE PROPERTIES WER E REFERRED TO VALUATION CELL FOR VALUATION. BASED ON THE REPORT OF THE VALU ATION CELL, THE ASSESSING OFFICER WORKED OUT THE DIFFERENCE IN THE VALUE OF T HE PROPERTY AT SHAIKPET VILLAGE AT RS. 12,57,500/- AND ADDED THE SAME TO TH E TOTAL INCOME OF THE ASSESSEE. AGGRIEVED, THE ASSESSEE PREFERRED THE APP EAL BEFORE THE CIT(A). 4. BEFORE THE CIT(A), IT WAS SUBMITTED THAT ON THE BASIS OF VALUATION OF REPORT AN ADDITION WAS MADE EVEN IN THE HANDS OF TH E ASSESSEES HUSBAND SHRI M.S RAJU FOR THE AY 2003-04 AND THE SAID ADDIT ION HAS BEEN DELETED BY THE CIT(A) AND THE ORDER OF THE CIT(A) HAS BEEN CONFIRMED BY THE TRIBUNAL. FURTHER THE AR SUBMITTED THAT NO REFEREN CE TO VALUATION CELL COULD BE MADE DURING THE BLOCK ASSESSMENT PROCEEDIN GS UNLESS THERE IS AN INCRIMINATING MATERIAL TO SUGGEST THAT SOME MORE MONEY HAS BEEN PAID THAT WHAT IS SHOWN IN THE BOOKS AND NO SUCH IN FORMATION WAS FOUND DURING THE COURSE OF SEARCH FOR MAKING THE ADDITION . 5. THE CIT(A) AT PARA 4.2 DISCUSSED THE ISSUE AND H ELD THAT THE ASSESSING OFFICER WAS NOT JUSTIFIED IN MAKING THE ADDITION. THE CIT(A) FURTHER HELD THAT FOLLOWING THE DECISION IN THE HUS BAND OF ASSESSEES CASE, THE ADDITION OF RS. 12,27,500/- BEING THE DIF FERENCE ON ACCOUNT OF VALUATION OF PROPERTY MADE BY THE ASSESSING OFFICER IS TO BE DELETED. AGGRIEVED THE REVENUE IS IN APPEAL BEFORE US AND HA S RAISED THE FOLLOWING EFFECTIVE GROUND.: THE CIT(A) ERRED IN DELETING THE ADDITION MADE TOWA RDS UNEXPLAINED INVESTMENT, SINCE REFERENCE TO VALUATION CELL DEPEN DS ON THE SATISFACTION OF THE ASSESSING OFFICER AND NO EVIDEN CE IS REQUIRED FOR REFERRING TO VALUATION CELL. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE RECORD. WE FIND THAT THE ISSUE HAS ALREADY BEEN DECIDED IN THE CASE OF SHRI M.S. RAJU, HUSBAND OF THE ASSESSEE, WHO IS THE PART OWNER OF T HE PROPERTY, BY THE COORDINATE BENCH OF HYDERABAD IN ITA NO. 737/HYD/06 FOR AY 2003-04 ORDER DATED 26 TH FEBRUARY, 2008 WHEREIN THE TRIBUNAL HELD AS UNDER: - 3 IT(SS)A NO. 11/HYD/2011 M. SUDHA RANI 7. WE HEARD THE RIVAL SUBMISSIONS. WE FIND THAT THE LUCKNOW BENCH OF THE TRIBUNAL IN THE CASE OF DCIT V S. ROHTAS PROJECTS LTD., 282 ITR (AT) 42) HAS CLEARLY HELD TH AT EVEN AFTER THE INTRODUCTION OF S. 142A, NO REFERENCE TO VALUAT ION CELL COULD BE MADE WITHOUT REJECTING THE BOOKS OF ACCOUNT. THE ASSESSEE, IT APPEARS, HAS FULLY DISCLOSED THE COST OF PURCHASE OF THE FOUR PROPERTIES IN HIS BOOKS OF ACCOUNT. THE ASSESSING OFFICER DID NOT HAVE ANY INFORMATION ABOUT ANY ON MONEY PAYMENT. THE ASSESSING OFFICER HAS ALSO NOT REJECTE D THE BOOKS OF ACCOUNT. IN THE CIRCUMSTANCES, FOLLOWING T HE DECISION OF THE LUCKNOW BENCH OF THE TRIBUNAL IN THE CASE OF ROHTAS PROJECTS LTD. (SUPRA), WE UPHOLD THE ORDER OF THE L EARNED CIT(A) AND REJECT THE GROUNDS OF THE REVENUE IN THIS APPEA L. 7. SINCE THE ISSUE UNDER CONSIDERATION IS IDENTICAL TO THE ONE DECIDED BY THE CO-ORDINATE BENCH IN THE CASE OF SHRI M.S. RAJU, HUSBAND OF THE ASSESSEE, WHO IS THE PART OWNER OF THE PROPERTY (SU PRA), WE UPHOLD THE ORDER OF THE CIT(A) IN DELETING THE ADDITION MADE T OWARDS UNEXPLAINED INVESTMENT BY THE ASSESSING OFFICER AND DISMISS THE GROUND OF APPEAL OF THE REVENUE RAISED IN THIS REGARD. 8. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. PRONOUNCED IN THE OPEN COURT ON 25/05/2012. SD/- SD/- (CHANDRA POOJARI) (ASHA VIJ AYARAGHAVAN) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DATED: 25 TH MAY, 2012 KV COPY TO:- 1) THE DY. . COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE 4, HYDERABAD 2) M. SUDHA RANI, B-3, PRESIDENT BANJARA APTS., SAGAR SOCIETY, ROAD NO. 2, BANJARA HILLS, HYDERABAD . 3) THE CIT (A)-!, HYDERABAD 4) THE CIT(CENTRAL), HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE,I.T.A.T., HYDER ABAD