DCIT, Coimbatore V. G.Mohan, Tiruppur

MA 126/CHNY/2014

• Counselvise Citation: [2015] 124 COUNSELVISE.COM (IT) 2671 (ITAT-CHENNAI)
• Duration Of Justice: 7 month(s) 21 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 30-01-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 21-11-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 09-06-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P RADHAKRISHNAN
• Assessee Lawyers: T BANUSEKAR
• Keywords: Unexplained cash credit; Rectification of order
• Section: 68

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , B B ENCH, CHENNAI . , ! # % & , ' ! ( BEFORE SHRI A.MOHAN ALANKAMONY ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER MISCELLANEOUS PETITION NO.126/ MDS/2014 (IN ITA.NO.1321/MDS/2012 ) (ASSESSMENT YEAR: 2008-09) DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-I, COIMBATORE. VS SHRI G.MOHAN, 35, 1 ST STREET, THIRUMALAI NAGAR SOUTH TIRUPUR-3. PAN:AJCPM3554G ( PETITIONER ) (RESPONDENT) APPLICANT BY : MR. P. RADHAKRISHNAN, JCIT RESPONDENT BY : MR. T. BANUSEKAR, C.A. / DATE OF HEARING : 21 ST NOVEMBER, 2014 / DATE OF PRONOUNCEMENT : 30 TH JANUARY, 2015 / O R D E R PER CHALLA NAGENDRA PRASAD, JM: THIS MISCELLANEOUS PETITION IS FILED BY THE REVENUE FOR RECTIFICATION OF MISTAKE APPARENT ON RECORD IN THE ORDER PASSED BY THIS TRIBUNAL IN ITA NO.1321/MDS/2012 DAT ED 19.11.2013 WHEREIN THE TRIBUNAL SUSTAINED THE FIND INGS OF THE COMMISSIONER OF INCOME TAX (APPEALS). 2. REVENUE SUBMITS THAT THAT THERE IS A MISTAKE AP PARENT ON RECORD IN THE CASE OF THE ASSESSEE AS FAR AS THE BASIC FACTS OF ADMISSION OF INCOME ON NET WEALTH ACCRETIO N AND M.P.NO.126/MDS/2014 2 CLAIM OF LIABILITY AS ADVANCE RECEIVED FROM 18 PERS ONS TOWARDS SALE OF LAND. DEPARTMENTAL REPRESENTATIVE REFERRIN G TO MISCELLANEOUS PETITION SUBMITS THAT ASSESSEE HAS SH OWN A SUM OF ` 24,66,750/- AS LIABILITY AND CLAIMED THE SAME AS ADVANCE RECEIVED FROM 18 PERSONS TOWARDS LAND SALE. IN THE COURSE OF ASSESSMENT PROCEEDINGS IT WAS FOUND FROM THE RELEVANT REGISTERED DOCUMENTS FILED, THE VALUE OF CONSIDERATION IS LESS THAN THE AMOUNT OF ADVANCE CL AIMED BY THE ASSESSEE. THE TOTAL AMOUNT OF CONSIDERATION PA ID FOR THE TRANSACTION IN RESPECT OF 18 PERSONS CAME TO ` 2,96,000/- AND DIFFERENCE OF ` 21,70,750/- WAS ASSESSED AS UNEXPLAINED CASH CREDIT U/S.68 OF THE ACT. DEPARTMENTAL REPRESE NTATIVE SUBMITS THAT THE HONBLE TRIBUNAL ON ONE HAND HAS RECOGNIZED THE PRACTICAL REALITY OF UNDERVALUING TH E PROPERTY FOR THE PURPOSE OF REGISTRATION AND ON OTHER HAND IT IS STATED THAT ENTIRE ADVANCE RECEIVED IS GENUINE. HE SUBMITS THAT BOTH THE STATEMENTS ARE SELF-CONTRADICTORY. IF THE PROPE RTY IS UNDERVALUED AND REGISTERED FOR A LOWER VALUE IS COR RECT, THEN THE EXCESS CONSIDERATION RECEIVED OVER & ABOVE THE REGISTERED VALUE IS NO LONGER AN ADVANCE, BUT IT IS AN INCOME M.P.NO.126/MDS/2014 3 ACCORDING TO THE ASSESSING OFFICER. DEPARTMENTAL REPRESENTATIVE SUBMITS THAT THE TRIBUNAL STATED TH AT ASSESSEE HAD ADMITTED AN AMOUNT OF ` 2,36,78,865/- AS ADDITIONAL INCOME BY WAY OF NET INCREASE IN WEALTH DURING THE YEAR. IT IS SUBMITTED THAT ASSESSEE HAS ADMITTED TH E INCOME BY NET WEALTH ACCRETION METHOD SINCE HE HAS NOT M AINTAINED ANY BOOKS OF ACCOUNT. DURING THE ASSESSMENT YEAR IN SUBJECT IN SAME MANNER ADMITTED INCOME OF ` 2,36,78,865/- . THE ASSESSEE IS STILL CLAIMING THIS ADVANCE AS LIABILIT Y. ONCE THE LAND SALE HAS BEEN REGISTERED, THE LIABILITY WILL N O LONGER EXIST. HENCE, THE NET WEALTH/ASSET VALUE INCREASES BY THIS SUM OF ` 21,70,750/- AND THEREBY THE INCOME WILL INCREASE B Y THE SAME AMOUNT. ALTERNATIVELY THE DEPARTMENTAL REPRES ENTATIVE SUBMITS THAT THE ASSESSEE NEVER PRODUCED ANY EVIDEN CE WITH REGARD TO THE ADVANCES ACCOUNT HOW IT IS ADJUSTED O R PAID BACK TO THE PARTIES IN THE SUBSEQUENT YEARS BY CHEQ UE OR OTHERWISE. THEREFORE, THE DEPARTMENTAL REPRESENTATI VE PRAYS THAT IMPUGNED ORDER OF THE TRIBUNAL MAY BE SUITABLY MODIFIED ACCORDINGLY. M.P.NO.126/MDS/2014 4 3. COUNSEL FOR THE ASSESSEE SUBMITS THAT THERE IS N O MISTAKE APPARENT ON RECORD IN THE IMPUGNED ORDER OF THIS TRIBUNAL AND THE MISCELLANEOUS PETITION FILED BY TH E REVENUE IS NOTHING BUT REVIEW PETITION. HE FURTHER SUBMITS THAT ASSESSEE HAS OFFERED A SUM OF ` 2,61,24,865/- AS INCOME FOR THE ASSESSMENT YEAR 2008-09 BASED ON THE NET INCREA SE IN WEALTH DURING THE YEAR. THE DIFFERENCE BETWEEN THE NET WEALTH AS PER WEALTH STATEMENT AS ON 31.3.2008 AND AS ON 1 .4.2001 WAS APPORTIONED AND OFFERED AS INCOME BY THE ASSESS EE FROM ASSESSMENT YEAR 2002-03 TO 2008-09. THE INCOME OFFE RED BY THE ASSESSEE IS NOTHING BUT SOURCE FOR THE INVESTME NT IN THE NET WEALTH OF THE ASSESSEE FOR THE RESPECTIVE YEARS . IN THE ASSETS & LIABILITIES STATEMENT AS ON 31.3.2008 THE ASSESSEE HAD SHOWN A SUM OF ` 24,66,750/- AS ADVANCES RECEIVED FROM 18 PERSONS TOWARDS SALE OF LAND. THE SAID ADVANCE RECEIVED BY THE ASSESSEE IS ACTUALLY THE SOURCE FOR THE INVE STMENT MADE BY THE ASSESSEE IN THE IMPUGNED ASSESSMENT YE AR. OUT OF THE ADVANCE SHOWN THE ASSESSING OFFICER HAD ACCEPTED A SUM OF ` 2,96,000/- AND ADDED THE BALANCE SUM OF ` 21,70,750/- AS UNEXPLAINED CREDIT U/S.68 THOUGH TH E SAME IS M.P.NO.126/MDS/2014 5 ACTUALLY THE SOURCE FOR THE INVESTMENT MADE BY THE ASSESSEE IN THE IMPUGNED ASSESSMENT YEAR AND SHOULD NOT HAVE BEEN MENTIONED AS UNEXPLAINED CREDIT U/S.68. COUNSEL SUB MITS THAT COMMISSIONER OF INCOME TAX (APPEALS) TREATED THE AD VANCE AS GENUINE AND DELETED THE ADDITION CONSIDERING THE FACT THAT THE APPELLANT HAD ADMITTED AN AMOUNT OF ` 2,36,78,865/- AS ADDITIONAL INCOME BY WAY OF NET INCREASE IN WEALTH DURING THE YEAR AND THE PRACTICAL REALITY OF UNDERVALUING OF T HE PROPER FOR THE PURPOSE OF REGISTRATION. WITH REGARD TO THE GRO UND RAISED IN PARA 5(B) OF THE MISCELLANEOUS PETITION, COUNSE L FOR THE ASSESSEE SUBMITS THAT NEITHER A GROUND WAS TAKEN NO R WAS ANY ARGUMENT PUT FORTH BY THE REVENUE BEFORE THE TR IBUNAL. HE SUBMITS THAT THE SAME IS COMPLETELY A NEW ARGUME NT WHICH THE REVENUE IS NOW TAKING BEFORE THIS TRIBUNA L IN THE MISCELLANEOUS APPLICATION AND THE SAME IS NOT A MIS TAKE APPARENT ON RECORD RECTIFIABLE U/S.254 OF THE ACT. COUNSEL SUBMITS THAT ASSESSEE HAD SHOWN A SUM OF ` 24,66,750/- AS ADVANCES TOWARDS SALE OF LAND IN THE STATEMENT OF A SSETS & LIABILITIES AS ON 31.3.2008. THE SAID LANDS HAVE NO T BEEN REGISTERED IN THE NAMES OF THE RESPECTIVE PERSONS I N THE M.P.NO.126/MDS/2014 6 IMPUGNED YEAR. THE ASSESSING OFFICER HAS ACCEPTED A SUM OF ` 2,96,000/- AS ADVANCES TOWARDS SALE OF LAND AND ASSESSED THE BALANCE SUM OF ` 21,70,750/- AS UNEXPLAINED CREDIT U/S.68 THOUGH THE SAME IS ACTUALLY THE SOURC E FOR THE INVESTMENT MADE BY THE ASSESSEE IN THE IMPUGNED ASSESSMENT YEAR AND SHOULD NOT HAVE BEEN MENTIONED AS UNEXPLAINED CREDIT UNDER SECTION 68. THE FACT THAT EVEN THE ASSESSING OFFICER DID NOT TAKE THE SUM OF ` 2,96,000/- AS FULL VALUE OF CONSIDERATION FOR COMPUTING THE CAPITAL GA INS OF THE ASSESSEE WOULD CLEARLY SHOW THAT EVEN THE ASSESSING OFFICER WAS AWARE THAT NO TRANSFER OF THE ASSETS TOOK PLACE IN THE IMPUGNED PREVIOUS YEAR FOR IF IT HAD BEEN THE CASE, HE WOULD HAVE ASSESSED CAPITAL GAINS IN THE HANDS OF THE ASS ESSEE. IT WAS NOT ARGUED BY THE REVENUE BEFORE THE TRIBUNAL T HAT LANDS WERE SOLD IN THE IMPUGNED YEAR AND THE INCOME HAS T O BE ASSESSED TO TAX IN THE IMPUGNED YEAR. IN SUCH A SIT UATION, REVENUE CANNOT NOW TAKE A STAND IN THE MISC.PETITIO N THAT ONCE THE LAND HAS BEEN REGISTERED THE LIABILITY NO LONGER EXISTS AND THAT THE INCOME WILL INCREASE BY THE SAME AMOUN T. FURTHER WITH REGARD TO THE CONTENTION RAISED BY THE REVENUE IN M.P.NO.126/MDS/2014 7 PARA 6 OF THE MISCELLANEOUS PETITION, COUNSEL SUBMI TS THAT REVENUE HAS NOT RAISED SUCH A GROUND BEFORE THIS TR IBUNAL AND NO SUCH ARGUMENT WAS PUT FORTH DURING THE COURS E OF THE HEARING. UNDER SUCH CIRCUMSTANCES REVENUE CANNOT N OW TAKE SUCH A PLEA BEFORE THIS TRIBUNAL. THEREFORE T HE COUNSEL PRAYS THAT AS THERE IS NO APPARENT MISTAKE IN THE O RDER PASSED BY THIS TRIBUNAL, THE MISCELLANEOUS PETITION FILED BY THE REVENUE IS LIABLE TO BE DISMISSED. 4. WE HAVE HEARD BOTH THE PARTIES. ON HEARING BOTH THE PARTIES, IT IS APPARENTLY CLEAR THAT DEPARTMENTAL REPRESENTATIVE REFERRING TO THE MISCELLANEOUS PETI TION TRIES TO REARGUE THE ENTIRE CASE ONCE AGAIN IN THE PROCEEDIN GS OF MISCELLANEOUS PETITION FILED BEFORE US. DEPARTMENTA L REPRESENTATIVE COULD NOT POINT OUT ANY SPECIFIC MIS TAKE OR ERROR CREPT IN IN THE IMPUGNED ORDER OF THIS TRIBUN AL. THE TRIBUNAL BY ORDER DATED 19.11.2013 DISMISSED THE AP PEAL OF THE REVENUE BY AFFIRMING THE ORDER OF THE COMMISSIO NER OF INCOME TAX (APPEALS) IN DELETING THE ADDITION MADE UNDER SECTION 68 OF THE ACT. THE TRIBUNAL DOES NOT HAVE P OWER TO M.P.NO.126/MDS/2014 8 REVIEW ITS OWN ORDER. THEREFORE, WE FIND THERE IS NO MISTAKE OR ERROR APPARENT IN THE ORDER PASSED BY THIS TRIBU NAL. 5. THE MISCELLANEOUS PETITION FILED BY THE REVENUE IS THUS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON FRIDAY, TH E 30 TH DAY OF JANUARY, 2015 AT CHENNAI. SD/- SD/- ( . ) ( # &' ( ) ( A.MOHAN ALANKAMONY ) ( CHALLA NAGEND RA PRASAD ) * / ACCOUNTANT MEMBER &, * / JUDICIAL MEMBER & /CHENNAI, . /DATED, 30 TH JANUARY, 2015 SOMU (,12 42 /COPY TO: 1. APPLICANT 2. (57 /RESPONDENT 3. 8 () /CIT(A) 4. 8 /CIT 5. 2 (,,; /DR 6. > /GF .