JAGDISH PRASAD SINGH,KOLKATA V. D.C.I.T., CC - 1(1), KOLKATA

ITSSA 137/KOL/2024

AI Insights

This case involves an appeal by Jagdish Prasad Singh against the order of the Commissioner of Income-tax (Appeals), which confirmed an estimated addition of \\u20b974,70,721/- to the assessee's income on account of undisclosed rental income for the assessment year 2014-15. The addition was initially made by the Assessing Officer following a search operation under section 132 of the Income Tax Act, 1961, where undisclosed rental incomes were found. The assessee had made a voluntary disclosure of \\u20b91,80,00,000/- as gross rental income for the period from FY 2008-09 to FY 2014-15. The Tribunal, referencing a similar case involving a co-ordinate Bench decision, allowed the appeal by applying the principle of telescopic benefit, thereby setting aside the CIT(A)'s order and directing the deletion of the addition.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 473940 (ITAT-KOLKATA)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 28-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2014-2015
• Other Referred Cases: Indira Devi Vs. DCIT in ITA No. 138/KOL/2024
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B.SATYANARAYANA RAJU
• Assessee Lawyers: MANISH TIWARI
• Keywords: Set aside
• Section: 132; 153A; 20

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, KOLKATA BEFORE SHRI RAJESH KUMAR, AM AND SHRI SONJOY SARMA, JM IT(SS)A No.137/KOL/2024 (Assessment Year:2014-15) Jagdish Prasad Singh 24/1, Masjid Bari Street, Kolkata-700006 West Bengal Vs. DCIT, Central Circle-1(1) Aaykar Bhavan Poorva 110, Shanti Pally, Kolkata-700107 West Bengal (Appellant) (Respondent) PAN No. ALHPS2918K Assessee by : Shri Manish Tiwari, AR Revenue by : Shri B. Satyanarayana Raju, DR Date of hearing: 24.02.2025 Date of pronouncement : 28.03.2025 O R D E R Per Rajesh Kumar, AM: This is an appeal preferred by the assessee against the order of the Commissioner of Income-tax (Appeals), 20 (hereinafter referred to as the “Ld. CIT(A)”] dated 27.09.2024 for the AY 2018-19. 02. The only issue raised by the assessee is against confirming the estimated addition of ₹74,70,721/- by the ld. CIT (A) as made by the ld. AO on account of rental income. 03. The facts in brief are that the search u/s 132 of the Act was conducted on the assessee on 03.04.2014, during which the assessee was found to be receiving the rent from several properties which was not disclosed in the return of income and accordingly, the assessee made Page | 2 IT(SS)A No.137/KOL/2024 Jagdish Prasad Singh; A.Y.2014-15 a disclosure of ₹1,80,00,000/- of gross rental income for the period commencing from F.Y. 2008-09 to F.Y. 2014-15 which includes ₹31,44,095 for F.Y. 2013-14 relevant to instant assessment year. The notice u/s 153A of the Act was issued on 29.04.2015 and return was filed on 26.11.2016, declaring total income of ₹22,18,900/-. Thereafter statutory notices were issued and duly served upon the assessee. The ld. AO, after discussing the property-wise rent collection by the assessee, made an addition of ₹87,63,571/-, towards rent received, which was not disclosed by the assessee. 04. In the appellate proceedings, the ld. CIT (A) partly allowed the appeal of the assessee by deleting the addition to the extent of ₹12,92,850/-, out of total addition made by the ld. AO of ₹87,63,571/- thereby sustaining the addition to the tune of ₹74,70,721/-. The ld. CIT (A) deleted the addition which is attributed to the extrapolation and estimation of rental income however, sustained the remaining addition. 05. The ld. Counsel for the assessee stated that undisputedly the assessee has made a voluntary disclosure during the search action amounting to ₹1,80,00,000/- towards the gross rental income for the period commencing from F.Y. 2008-09 to F.Y. 2014-15. The ld. AR submitted that during the year the addition made by the ld. AO was to the tune of ₹87,63,571/- out of ₹12,92,850/-, was already deleted by the ld. CIT (A) and remaining ₹74,70,721/- was sustained by the ld. CIT (A) which may be deleted by allowing telescopy against the voluntary disclosure made by the assessee of ₹1,80,00,000/-over the period as stated in above. The ld. Counsel for the assessee stated the issue is squarely covered by the decision of the co-ordinate Bench in the same search in case of Smt Indira Devi qua wherein the similar disclosure Page | 3 IT(SS)A No.137/KOL/2024 Jagdish Prasad Singh; A.Y.2014-15 of ₹1,80,00,00/- was made and the addition made by the ld. AO towards rent was deleted by allowing telescopic benefit against the voluntary disclosure. The ld. AR stated that since the facts of the case are similar and therefore, the appeal of the assessee should be allowed by following the decision of the coordinate Bench in the case of Indira Devi Vs. DCIT in ITA No. 138/KOL/2024 vide order dated 31.01.2025, who was also covered in the same search. 06. The ld. DR on the other hand relied on the order of the ld. CIT (A), however, candidly admitted that the similar issue has been decided by the co-ordinate Bench in the decision as cited by the ld. AR. 07. After hearing the rival contentions and perusing the materials available on record, we find that the assessee has made a total disclosure of gross rental of ₹1,80,00,000/- over a period of F.Y. 2008-09 to 2014-15. The instant assessment year before us is 2014- 15 for which the addition of ₹74,70,721/- was confirmed by the ld. CIT (A). In our opinion, the disclosure made in the hands of the assessee is sufficient to cover the said addition by allowing the telescopic benefit to the assessee. The case of the assessee is squarely covered by the decision of the co-ordinate Bench in case of Indira Devi (supra), wherein the co-ordinate Bench has held as under:- “5. After hearing the rival contentions and perusing the materials available on record, we find that the assessee has made a total disclosure of gross rental of ₹1,80,00,000/- over the period of F.Y. 2008-09 to F.Y. 2014-15. We note that though the rent assessed by the AO is correct but the rental disclosure during search was more than amount of undisclosed on account of undisclosed gross rental income. Therefore, when the disclosure made was more than the actual rent received by the assessee taking into account the period right from the F.Y. 2008-09 to F.Y.2014-15, then the assessee has to be given benefit of telescopic benefit. Thus, considering the factual matrix, in our view, the assessee has to be given telescopic benefit out of the total disclosure of gross rental made by the assessee as the total disclosure is enough Page | 4 IT(SS)A No.137/KOL/2024 Jagdish Prasad Singh; A.Y.2014-15 to cover the shortfall in the current year rental income of ₹59,41,114/-. Accordingly, the order of ld. CIT (A) is set aside and the AO is directed to delete the addition.” 08. Since, the facts of the case before us are similar to the ones as decided by the co-ordinate Bench hereinabove, accordingly, we respectfully following the same, set aside the order of the ld. CIT (A) and direct the AO to allow the telescopic benefit of the addition made against the voluntary disclosure made by the assessee. Accordingly, the appeal of the assessee is allowed and AO is directed to delete the addition. 09. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 28.03.2025 Sd/- Sd/- (SONJOY SARMA) (RAJESH KUMAR) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Kolkata, Dated: 28.03.2025 Sudip Sarkar, Sr.PS Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. CIT 4. DR, ITAT, 5. Guard file. BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Kolkata "