Poonam Mohta, Kolkata V. ACIT, Central Cir 1(1), Kolkata

ITSSA 156/KOL/2023

• Counselvise Citation: [2023] 100 COUNSELVISE.COM (IT) 5058 (ITAT-KOLKATA)
• Duration Of Justice: 2 month(s) 6 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 28-11-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: B
• Assessment Year: 2015-2016
• Appeal Filed On: 21-09-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P.K. SANGHAI
• Keywords: Salary income; Opportunity of being heard; Earning of tax free income; Deemed dividend; Rule 8D
• Section: 80C; 143(3); 142(1); 2(22)(e); 14A; 250; 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH ‘B’, KOLKATA [Before Dr. Manish Borad, Accountant Member & Shri Sonjoy Sarma, Judicial Member] IT(SS)A No. 156/Kol/2023 Assessment Year : 2015-16 Poonam Mohta PAN: AEZPM 1243 A Vs . ACIT, Central Circle-1(1), Kolkata Appellant Respondent Date of Hearing 21.11.2023 Date of Pronouncement 29.11.2023 For the Assessee Shri P.K. Sanghai, AR For the Revenue Shri Abhijit Kundu, CIT ORDER Per Sonjoy Sarma, JM: This is an appeal filed by the assessee pertaining to the assessment year (in short ‘A.Y.’) 2015-16 is directed against the order of Ld. CIT(A)-20, Kolkata dated 31.07.2023 which is arising out of the assessment order passed u/s 143(3) r.w.s. 153B of the Income Tax Act, 1961(in short ‘the Act’) dated 30.12.2016. The assessee has raised the following grounds of appeal: “1. That the order passed by the Ld CIT(A) is against the law and facts on the file and circumstances of the case who passed the order u/s 250 of the I T Act 1961 without proper opportunity of being heard and looking in to records and thus the assessee was deprived of the reasonable and fair hearing in the matter being raised in the subsequent grounds of appeal. 2. That the Ld. Commissioner of Income-tax (Appeals) was not justified to uphold the action of the Ld Assessing Officer who made a disallowance of Rs. 3,33,509/- u/s 14A by incorrect calculation which was not in consonance with Rule 8D of the I T Rule and actually which ought not to have been made by the Assessing Officer under the facts and circumstances of the case. 2 IT(SS)A No. 156/Kol/2023 AY: 2015-16 Poonam Mohta 3. That the order passed by the Ld. Commissioner of Income-tax (Appeals) is against the law and on facts in as much as he was not justified to uphold the action of the Ld Assessing Officer in making addition of Rs. 5,39,576/- on account of alleged Deemed dividend U/s 2(22X e) of the Income Tax Act ^ which under the circumstances was inapplicable considering the entire nature of such transactions. 4. That the order passed by the Ld. Commissioner of Income-fax (Appeals) is against the law and on facts on the file in as much as he was not justified to uphold the action of the Ld Assessing Officer who did not allow the genuine deduction under chapter VIA of the being eligible u/s 80 C amounting to Rs 1,50,000/- and under section 80D Rs 15000/- of the Act which ought to have been given by the Id CIT(A) even though not specifically stated before him. 5. That the order passed by the Ld. Commissioner of Income-tax (Appeals) is against the law and on facts on file in as much as he was not justified to ignore the double addition of Rs. 50,00,000/- made by the Ld. Assessing Officer who while computing the total income added this amount once under the income from other sources and again separately as disclosure in the computation part which ought not to have been done by the AO and ought to have been deleted by the Ld. CIT(A) as a matter based out of record of the assessee. 6. That the appellant craves leave to add, amend, alter or delete the ground or grounds of appeal.” 2. Brief facts of the case are that a search and seizure operation u/s 132(1) of the Act was conducted in the case of assessee followed by notices issued u/s 142(1) and 143(2) of the Act. In response to the notices, assessee submitted detailed explanation in compliance to the notices issued by the AO. The ld. AO after considering the submission of the assessee various disallowances were made and assessed the income of the assessee as under: 3 IT(SS)A No. 156/Kol/2023 AY: 2015-16 Poonam Mohta “Income from salary Rs. 24,00,000/- Income from house property Rs. 8,77,772/- Income from other sources Rs. 71,88,175/- Add: Disallowance u/s 14A as discussed Rs. 3,33,509/- On A/c of deemed dividend as discussed Rs. 5,39,576/- Disclosure Rs. 50,00,000/- Gross total income Rs. 1,63,39,032/- Less: deduction u/s 80TTA Rs. 10,000/- Net total income Rs. 1,63,29,032/- Rounded off to Rs. 1,63,29,030/-” 3. Dissatisfied with the above order, assessee preferred an appeal where the appeal of the assessee was dismissed. 4. Aggrieved by the above order, assessee is in appeal before the Tribunal raising various grounds. 5. In ground no. 1, the appeal of the assessee is in general in nature therefore, need not required to be adjudicated. 6. In ground no. 2, the assessee stated that ld. CIT(A) while passing the impugned order was not justified by upholding the action of ld. AO by disallowing of Rs. 3,33,509/- u/s 14A of the Act is not correct which is not in accordance with law in terms of Rule 8D of the I.T. Rules. In this regard, the ld. AR submitted before the bench that by sustaining the view taken by the AO by disallowing of Rs. 3,33,509/- u/s 14A is not correct. Therefore, the addition made in the hands of assessee is liable to be deleted. 4 IT(SS)A No. 156/Kol/2023 AY: 2015-16 Poonam Mohta In this regard, the ld. AR further contended that the assessee has its own sufficient funds to earn exempt income. Therefore, such calculation made by ld. AO is uncalled for and even it is disallowed it cannot be exceeded to Rs. 74,946/- which assessee has earned as exempt dividend income during the assessment year under consideration. 7. On the other hand, ld. DR supported the order passed by the authorities below and oppose the prayer made by the AR of the assessee. 8. We after hearing the rival submission of the parties and perusing the record placed before us. We notice that assessee has its own fund to earn exempt during the year from the balance sheet placed before us. After considering the submission of the parties and examining the facts of the case we restrict the disallowance of expenditure to the extent of Rs. 74,946/- in the hands of assessee and partly allow the grounds taken by the assessee. 9. In ground no. 3, the assessee has challenged the order of ld. CIT(A) by upholding the action of ld. AO in making the addition of Rs. 5,39,576/- on account of alleged deemed dividend u/s 2(22)(e) of the Act which is in applicable in the case of assessee. On this issue, the ld. AR submitted that assessee has paid sufficient interest to the company namely M/s. Surajmal Mohta & Co. Pvt. Ltd. by placing confirmation of accounts from the 5 IT(SS)A No. 156/Kol/2023 AY: 2015-16 Poonam Mohta company in its paper book at page no. 6. Therefore, the view taken by the AO is uncalled for and the provisions of section 2(22)(e) of the Act does not attract in the case of assessee. 10. We after hearing the rival submission of the parties and perusing the records as well as documents placed before us find that the provisions of section 2(22)(e) of the Act does not attract in the case of present assessee since the assessee has paid sufficient interest to the company. Accordingly, the addition made in the hands of assessee is hereby deleted and ground taken by the assessee is hereby allowed. 11. In ground no. 4, the assessee has stated that the ld. AO while calculating the income of assessee deduction under Chapter VIA of the Act amounting to Rs. 1,50,000/- u/s 80C and u/s 80D of Rs. 15,000/- of the Act did not take into consideration and even the ld. CIT(A) also not considered the above facts therefore, the claim of the assessee may be allowed by the Tribunal. On this context, the ld. AR submitted that computation of income statement to show before us that assessee is eligible for deduction u/s 80C of the Act amounting to Rs. 1,50,000/- and u/s 80D of Rs. 15,000/- of the Act. 12. We after considering the submission of the parties and perusing the document placed before us by the assessee find that the claim of the assessee is correct and accordingly deduction u/s 80C amounting to Rs. 1,50,000/- and u/s 80D of Rs. 6 IT(SS)A No. 156/Kol/2023 AY: 2015-16 Poonam Mohta 15,000/- is hereby allowed and ground taken by the assessee is hereby allowed. 13. In ground no. 5, the contention of the assessee is that ld. CIT(A) was not justified to ignore the double addition of Rs. 50 lakhs made by the ld. AO while computing the total income of the assessee and added this amount once under the income from other sources and again separately as disclosure while computation of income which is not correct and accordingly ld. CIT(A) ought to be deleted made by the AO. The ld. AR submitted before the bench that the alleged addition of Rs. 50 lakhs made in the hands of assessee by the AO twice under the head of income from other sources and again it was added separately while computation part therefore such double addition is not proper and in order to examine the issue it may necessary be remand back to the issue to the file of AO. 14. On the other hand, ld. DR has not raised any objection on such prayer made by the AR of the assessee. We after hearing both the parties and considering the prayer made by the assessee remand back the issue to the file of AO to examine the instant issue afresh and if it is double addition then necessary correction would be made accordingly by calculating the correct income of the assessee. Accordingly, the instant issue is allowed for statistical purposes. 7 IT(SS)A No. 156/Kol/2023 AY: 2015-16 Poonam Mohta 15. Ground no. 6 is general in nature need not required to be adjudicated. In terms of the above, the appeal of the assessee is hereby partly allowed. 16. In the result, the appeal of the assessee is partly allowed for statistical purposes. Order pronounced in the open court on 29.11.2023. Sd/- Sd/- (Manish Borad) (Sonjoy Sarma) Accountant Member Judicial Member Dated: 29.11.2023 Biswajit, Sr. PS Copy of the order forwarded to: 1. Appellant- Poonam Mohta, 6/2, Queens Park, Ballygung, Kolkata-700019. 2. Respondent – ACIT, Central Circle-1(1), Kolkata. 3. Ld. CIT 4. Ld. CIT(A) 5. Ld. DR True Copy By Order Assistant Registrar ITAT, Kolkata Benches, Kolkata