The DCIT, Circle-4, Ahmedabad V. Shri Amit N.Shah, Ahmedabad

ITSSA 507/AHD/2010

• Counselvise Citation: [2013] 121 COUNSELVISE.COM (IT) 9269 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 20 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 14-06-2013
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 30-04-2013
• Assessment Year: misc
• Appeal Filed On: 25-05-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: A TIRKEY
• Keywords: Income from undisclosed sources; Rectification of order; Block assessment; Revised return
• Section: 244A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH AHMADABAD BEFORE SHRI MUKUL KR. SHRAWAT , JUDICIAL MEMBER AND SHRI T.R. MEENA, ACCOUNTANT MEMBER IT(SS)A NO. 507/AHD/2010 BLOCK PERIOD :1985-86 TO 1995-96 AND UPTO 21.12.1995 THE DCIT, CIR-4, AHMADABAD, NAVJIVAN TRUST BLDG., OFF. ASHRAM ROAD, AHMEDABAD V/S . AMIT N. SHAH 13, MANGALAM SOCIETY, S.M. ROAD, NEHRUNAGAR, AHMEDABAD PAN NO. A LWPS7903F (APPELLANT) .. (RESPONDENT) BY APPELLANT SHRI A. TIRKEY, SR. D.R. /BY RESPONDENT SHRI ANIL KSHATRIYA, A.R. /DATE OF HEARING 30.04.2013 /DATE OF PRONOUNCEMENT 14.06.2013 O R D E R PER : T.R.MEENA, ACCOUNTANT MEMBER THIS IS AN APPEAL AT THE BEHEST OF THE REVENUE WHIC H HAS EMANATED FROM THE ORDER OF CIT(A)-XX, AHMEDABAD, DATED 24.02 .2010 FOR BLOCK PERIOD 1985-86 TO 1995-96 AND UPTO 21.12.1995. THE SOLE GROUND OF REVENUES APPEAL IS AGAINST THAT THE A.O. WAS DIREC TED BY THE CIT(A) IN HIS ORDER TO REFUND THE TAXES ADJUSTED ON THE INCOME OF RS.24,76,000/- WHICH WAS SUSTAINED BY THE HONBLE ITAT WITH INTEREST. 2. THE FACTS OF THE CASE IS THAT IN THIS CASE, ORIG INAL ASSESSMENT U/S. 158BC R.W. 158BD WAS PASSED ON 20.11.1997 DETERMINI NG THE INCOME AT RS.22,74,46,700/- (INCLUDING ADDITION MADE ON PROTE CTIVE BASIS OF IT(SS)A NO. 507/AHD/10 BLOCK PERIOD :1985-86 TO1995-96 AND UPTO 21.12.1995 PAGE 2 RS.9,50,27,058/-). THE ASSESSMENT WAS SET ASIDE BY THE HONBLE ITAT VIDE ORDER DATED 25.08.2004, DIRECTING THE ASSESSING OFF ICER TO PASS THE ASSESSMENT AFRESH AFTER ALLOWING ADEQUATE OPPORTUNI TY TO THE ASSESSEE. LD. A.O. HAD GIVEN REASONABLE OPPORTUNITY OF BEING HEAR D AT THE DIRECTION OF THE ITAT AND SERVED NOTICE U/S.143(2)/142(1) R.W.S. 158 BD OF THE IT ACT ON 26.12.2005 AND SERVED ON 27.12.2005 AND CASE WAS FI XED FOR 04.01.2006. IN RESPONSE TO THIS NOTICE, THE ASSESSEES A.R., SHRI ANIL KSHATRIYA, ITP APPEARED BEFORE THE A.O. MEANWHILE, THE ASSESSEE H AD FILED A REVISED RETURN OF INCOME ON 14.03.2006 REDUCING THE INCOME AT RS.1 ,72,11,000/- FOR THE ABOVE BLOCK PERIOD. THE ASSESSEE HAD ADMITTED INCO ME OF RS.5,21,88,400/- IN THE ORIGINAL RETURN OF INCOME FILED ON 08.03.199 6. THE A.O. HELD THAT REVISED RETURN FILED BY THE ASSESSEE IS INVALID AND NON-EST ON THE BASIS OF VARIOUS REASONS MENTIONED ON PAGE NOS. 2, 3 & 4 OF THE RECTIFICATION ORDER U/S.254 DATED 23.03.2006. IT WAS FURTHER OBSERVED BY THE A.O. THAT DR. AMIT N. SHAH ADMITTED U/S. 132(4) ON 31.01.1996 BEFORE T HE ADI-II(I), AHMADABAD AND ADMITTED UNACCOUNTED SHARES VALUED AT RS.4,76,9 0,400/- WHICH WAS ADMITTED UNACCOUNTED INCOME FOR THE BLOCK PERIOD. VARIOUS UNRECORDED SHARES ADMITTED BY THE APPELLANT DURING THE COURSE OF INTERROGATION. THE A.O. FINALLY ASSESSED THE ASSESSEES INCOME AT RS.24,17, 31,739/-. 3. THE ASSESSEE FILED THE APPEAL AGAINST BLOCK ASSE SSMENT BEFORE THE CIT(A) AND FINALLY ITAT AGAINST THE QUANTUM ADDITIO N. THE LD. A.O. GAVE THE APPEAL EFFECT ON 18.08.2009 U/S. 254 OF THE IT ACT AND FINALLY INCOME WAS DETERMINED AT RS.24,76,000/- ON WHICH THE TAX @ 60% WAS CALCULATED. THE IT(SS)A NO. 507/AHD/10 BLOCK PERIOD :1985-86 TO1995-96 AND UPTO 21.12.1995 PAGE 3 LD. A.O. HAD ADJUSTED THE TAX OF RS.14,85,600/- FRO M TAX PAID BY THE ASSESSEE ON DIFFERENT DATES AT RS.3,12,82,424/- AND AFTER AD JUSTING THE TAX NET REFUND WAS CALCULATED AT RS. 2,97,96,824/- ON WHICH INTERE ST U/S. 254A WAS ALLOWED AT RS.3,23,55,279/-. THUS, TOTAL REFUND WAS ALLOWE D INCLUDING INTEREST U/S.244A AT RS.6,21,52,043/- TO THE ASSESSEE. THE ASSESSEE CHALLENGED THIS APPEAL EFFECT ORDER BEFORE THE CIT(A) ON THE GROUND THAT ADJUSTMENT ON TAX IS NOT JUSTIFIED. THE LD. CIT(A) HELD AS UNDER: 3.2 I HAVE CAREFULLY CONSIDERED THE ORDER OF THE A .O. GIVING EFFECT TO THE ORDER OF THE ITAT AND THE ABOVE SUBMISSIONS OF THE APPELLANT. FROM THE PERUSAL OF BLOCK ASSESSMENT ORDER (PARA-4) AND THE ORDER OF THE ITAT (PARA-19) THE FACTS ARE CLEAR THAT THE AMOUNT WHICH WAS SHOWN IN BLOCK RETURN IS RS.5,21,86,400/-. THE AMO UNT OF RS.24,76,000/- WHICH HAS BEEN SUSTAINED BY THE HON BLE ITAT IS THE PART OF OTHER ADDITIONS MADE OVER AND ABOVE AT RS.2 ,27,86,000/- AS APPEARING IN PARA-5 OF THE BLOCK ASSESSMENT ORDER A ND PARA-20 OF THE ITATS ORDER. THE ITAT HAS HELD THAT THUS, OU T OF AN ADDITION OF RS.2,27,86,000/- THE ADDITION TO THE EXTENT OF RS.2 4,76,000/- IS SUSTAINED. THIS FACT IS ALSO CLEAR FROM THE AOS ORDER DT. 18.08.2009 GIVING EFFECT TO THE ORDER OF THE ITAT AS PER SR. N O. 4 & 5 OF TABLE-A. IN VIEW OF THE ABOVE FACTS THE OBSERVATION OF THE A.O. THAT INCOME OF RS.24,76,000/- WAS ADMITTED BY THE APPELL ANT WITH THE BLOCK RETURN IS NOT CORRECT. THEREFORE THE INCOME OF RS.24,76,000/- IS DIRECTED TO BE EXCLUDED FROM THE CALCULATION MAD E IN THE ORDER BY THE A.O. ACCORDINGLY, THE ASSESSING OFFICER IS DIR ECTED TO GRANT REFUND OF THE WHOLE TAXES PAID OF RS.3,12,82,424/- ON VARIOUS DATED AND TO RE-COMPUTE INTEREST U/S.244A UPTO THE DATE O F ORDER AND ALSO ALLOW INTEREST ON THAT AMOUNT TILL THE DATE OF ISSU E OF THE FRESH REFUND OF THE SAID AMOUNT SUBJECT TO ADJUSTMENT OF THE AMO UNT ALREADY REFUNDED. THE REFUND OF RS.6,21,52,043/- DETERMINE D ON 18/8/2009 IT(SS)A NO. 507/AHD/10 BLOCK PERIOD :1985-86 TO1995-96 AND UPTO 21.12.1995 PAGE 4 AND GRANTED ON 28/8/2009 WILL BE REVISED AFTER COMP UTATION OF THE INTEREST U/S.244A. THE SAID INTEREST AMOUNT ALSO I S TO BE REFUNDED AND INTEREST ON THE SAID AMOUNT IS TO BE ALLOWED TI LL THE DATE OF ISSUE OF FRESH REFUND. 4. NOW, THE REVENUE IS BEFORE US. LD. SR. D.R. CON TENDED THAT THE ADDITION OF RS.24,76,000/- WAS PART OF TOTAL ADDITI ON OF RS.2,27,86,000/- WHICH WAS CONFIRMED BY THE ITAT. AS PER SECTION 158B(B), IT IS A PART OF UNDISCLOSED INCOME OF RS.2,27,86,000/-. THE TAX IS TO BE CHARG ED U/S.113 ON UNDISCLOSED INCOME OF THE BLOCK PERIOD @ 60%. AS PER SECTION 1 58BC, SECTION E, THE ASSESSING OFFICER ON DETERMINATION OF THE UNDISCLOS ED INCOME FOR THE BLOCK PERIOD IN ACCORDANCE WITH CHAPTER XIVB, SHALL PASS AN ORDER OF ASSESSMENT AND DETERMINE THE TAX PAYABLE BY HIM ON THE BASIS O F SUCH ASSESSMENT. THE LD. A.O. ORIGINALLY CALCULATED THE TOTAL INCOME FOR BLOCK PERIOD AT RS.24,17,31,739/-, WHICH WAS REDUCED TO RS.24,76,00 0/- AFTER EFFECT OF THE ITAT ORDER. THUS, THE A.O. HAS RIGHTLY ADJUSTED TH E TAX ON REMAINING INCOME. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE RELIED UPON THE ORDER OF CIT(A) AND ARGUED THAT THE A.O. SHOULD HAVE ALLOWED THE INTERE ST ON FULL AMOUNT PAID BY THE ASSESSEE AT RS.3,12,82,424/- U/S. 244A UP TO TH E DATE OF THE ORDER. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD. THE ADMISSION OF INCOME BY THE APPELLANT I S NOT REQUIRED FOR CALCULATING THE TAX ON UNDISCLOSED INCOME UNDER THE BLOCK ASSESSMENT CHAPTER. THE A.O. HAS TO ASSESS THE UNDISCLOSED IN COME UNDER THIS CHAPTER AND CALCULATE THE TAX. THE DEMAND EVEN ON REMAININ G ADDITION IS EFFECTIVE FROM THE DATE OF ORIGINAL ORDER OF THE A.O. I.E. 23 .03.2006 IN WHICH UNDISCLOSED IT(SS)A NO. 507/AHD/10 BLOCK PERIOD :1985-86 TO1995-96 AND UPTO 21.12.1995 PAGE 5 INCOME WAS CALCULATED AT RS.24,17,31,739/-. THE IT EM NO.1 WAS ADDITION OF RS.2,27,86,000/- ON ACCOUNT OF PURCHASE OF SHARE AS PER PARA 5 OF THE ASSESSMENT ORDER. OUT OF THIS, THE REMAINING ADDIT ION OF RS.24,76,000/- WAS CONFIRMED BY THE ITAT. THUS, THE A.O. WAS RIGHT IN ADJUSTING THE TAX FROM THE TAX PAID BY THE ASSESSEE AT RS.3,12,82,424/-. AFTE R ADJUSTING THE TAX ON RS.24,76,000/- AT RS.14,85,600/-, HE CALCULATED RIG HTLY NET REFUND INCLUDING INTEREST AT RS.6,21,52,043/-. THUS, WE HAVE CONSID ERED VIEW THAT CIT(A) WAS NOT RIGHT IN ALLOWING THE APPEAL OF THE ASSESSEE. ACCORDINGLY, WE REVERSE THE ORDER OF THE CIT(A). 6. IN THE RESULT, THE REVENUES APPEAL IS ALLOWED. THIS ORDER PRONOUNCED IN OPEN COURT ON 14.06.2013 SD/- SD/- ( MUKUL KR. SHRAWAT ) (T.R. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER TRUE COPY S.K.SINHA ! ! ! ! '! '! '! '! / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT 2. / RESPONDENT 3. '(' ) * / CONCERNED CIT 4. *- / CIT (A) 5. !./ ), ) , 12( / DR, ITAT, AHMEDABAD 6. /45 67 / GUARD FILE. BY ORDER/ , 8/ 1 ': ) , 12( ;