Aremkay, Tirunelveli V. DCIT, CHENNAI

MA 241/CHNY/2015

• Counselvise Citation: [2016] 124 COUNSELVISE.COM (IT) 4282 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 20 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 27-04-2016
• Appeal Filed By: Assessee
• Bench Allotted: B
• Next Hearing Date: 08-04-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 07-12-2015
• Court: TRIBUNAL
• Department Lawyers: H KABILA
• Assessee Lawyers: R VIJAYARAGHAVAN
• Keywords: Depreciation; Reasonable cause; Revenue expenditure

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI , ! ' ! # . $% , & '( BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT M EMBER AND SHRI DUVVURU RL REDDY, JUDICIAL MEMBER M.A.NOS. 238 TO 240/MDS/2015 (IN ITA NOS. 1770 TO 1772/MDS/2014) /ASSESSMENT YEARS : 2007-08 TO 2009-10 SHRI N. VISWANATH, L/H OF LATE K.V.NELLAIYAPPAN, PROP: RMKV ENTERPRISES, 176F, TRIVANDRUM ROAD, TIRUNELVELI 627 003. PAN AAJPN8275H ( /APPLICANT) V. THE DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-IV(1), CHENNAI. ( /RESPONDENT) M.A.NOS. 241 TO 244/2015 (IN ITA NOS. 1773 TO 1775/MDS/2014) /ASSESSMENT YEARS : 2006-07 TO 2009-10 M/S. AREMKAY, 176F, TRIVANDRUM ROAD, TIRUNELVELI-627 003. PAN AAHFA9459J ( /APPLICANT) V. THE DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-IV(1), CHENNAI. ( /RESPONDENT) - - MA 238 TO 240/15 ETC. 2 M.A.NOS. 245 TO 248/MDS/2015 (IN ITA NOS. 1777 TO 1780/MDS/2014) /ASSESSMENT YEARS : 2006-07 TO 2009-10 M/S. VISWAMS, 176F, TRIVANDRUM ROAD, TIRUNELVELI-627 003. PAN AADFV5601A ( /APPLICANT) V. THE DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-IV(1), CHENNAI. ( /RESPONDENT) APPLICANTS BY : SHRI R. VIJAYARAGHAVAN, ADVOCATE DEPARTMENT BY : MS. H. KABILA, JCIT / DATE OF HEARING : 08.04.2016 / DATE OF PRONOUNCEMENT: 27.04.2016 ) / O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER THESE MISCELLANEOUS APPLICATIONS FILED BY THE AS SESSEE ARE ARISING OUT OF THE COMMON ORDER OF THE TRIBUNAL IN ITA NOS.1769/MDS/2014 & OTHERS DATED 28.8.2015. 2. THE FIRST GRIEVANCE OF THE ASSESSEE IN ALL THESE M.AS IS WITH REGARD TO GIVING THE DIRECTION IN RESPECT OF A DDITION TO THE CLOSING STOCK BY ADOPTING COST OF GOODS AT THE YEAR END INSTEAD OF ADOPTING COST OR REALISABLE VALUE FOLLOWED BY TH E ASSESSEE IN PARA 5 OF TRIBUNALS ORDER IS AS FOLLOWS : - - MA 238 TO 240/15 ETC. 3 5. WE HAVE HEARD BOTH THE SIDES AND PERUSED THE MATERIAL ON RECORD. THE ASSESSEE HAS VALUED THE UNSOLD STOCK BY DISCOUNTING PURCHASE PRICE AT FIXED PERCEN TAGE CONSIDERING THE AGE OF THE STOCK. HOWEVER, THIS ME THOD OF REDUCTION IS NOT FOLLOWING YEAR BY YEAR. FOR EXAMP LE, AS SEEN FROM THE ABOVE TABLE, IN THE ASSESSMENT YEAR 2 009-10, THE ASSESSEE ADOPTED THE REDUCTION OF VALUE OF PURC HASE PRICE AT 25%, WHEN THE STOCK IS ONE YEAR OLD. HOWE VER, FOR THE ASSESSMENT YEAR 2008-09, IT WAS 50%, FOR THE ASSESSMENT YEAR 2007-08 AGAIN 25% AND FOR THE ASSESSMENT YEAR 2006-07, THE SAME WAS 50%. THERE I S NO EXPLANATION FOR SUCH KIND OF ARBITRARY REDUCTION OF EITHER 25% OR 50%. THERE IS NO CONSISTENCY IN THE METHOD FOLL OWED BY THE ASSESSEE FOR VALUING THE CLOSING STOCK. THE CLOSING STOCK IS TO BE VALUED AT MARKET PRICE OR COST WHICH EVER IS LESS AND THAT SHOULD BE CONSISTENT FROM YEAR TO YEA R. THE ASSESSEE IS NOT DISPUTED THAT IT HAS BEEN FOLLOWED THE SAME METHOD. HOWEVER, CONSEQUENT TO SEARCH ACTION, THE ASSESSEE WANTED TO CHANGE THE METHOD OF STOCK VALUA TION FOR THE FIRST TIME, WHICH IS NOTHING BUT AN AFTER-T HOUGHT SO AS TO REDUCE THE INCOME WHICH CANNOT BE PERMITTED AT T HIS POINT OF TIME. ACCORDINGLY, THIS GROUND IN ALL THESE APP EALS IS REJECTED. 3. ACCORDING TO THE LD. AR, THE ASSESSEE IS VALUING THE CLOSING STOCK ON THE BASIS OF NET REALISABLE VALUE FOR CLOTHES HAVING IN MIND THE PERIOD FOR WHICH THE CLOTHES HAV E NOT BEEN SOLD. IN A FAST MOVING FAST CHANGING FASHIONS OLD CLOTHES LOSE THEIR VALUE. WHEN CLOTHES ARE NOT SOLD FOR A YEAR, THEIR SALE VALUE DRASTICALLY FALLS DOWN. IT IS ONLY BY OFFERING DEE P DISCOUNTS CAN THE ASSESSEE HOPE TO SELL SOME OF THE OLD STOCKS. IF THE ASSESSEE IS NOT ABLE TO SELL STOCK FOR MORE THAN TH REE YEARS, EVEN - - MA 238 TO 240/15 ETC. 4 BY OFFERING DISCOUNTS, SUCH STOCKS ARE HARDLY LIKEL Y TO FETCH ANY PRICE. THUS, THE VALUATION OF THE STOCK BY THE ASS ESSEE BASED ON THE EXPERIENCE CANNOT BE REJECTED WITHOUT ANY VALID REASON. 3.1 THE LD. AR, ALSO SUBMITTED THAT THE METHOD OF V ALUATION IS REFLECTED IN THE CLOSING STOCK VALUATION IN THE AUD ITED BALANCE SHEET AND PROFIT AND LOSS FILED ALONG WITH THE RETU RN FOR THE ASST. YEAR 2006-07 ONWARDS (MUCH BEFORE THE SEARCH CONDUC TED IN FEB 2009) AND NOT AN AFTERTHOUGHT AFTER THE SEARCH. IT IS THEREFORE SUBMITTED THAT THE TRIBUNAL ERRED IN CONC LUDING THAT THE METHOD OF VALUING THE STOCK WAS AN AFTERTHOUGHT AFT ER THE SEARCH AND HENCE THE ORDER REQUIRES RECTIFICATION. THEREF ORE, HE PRAYED THAT AS THIS METHOD HAS BEEN FOLLOWED BY THE ASSESS EE CONSISTENTLY, THE SAME MAY BE ACCEPTED. 4. THE LD. DR OPPOSED THE ARGUMENTS OF THE LD. AR A ND SUBMITTED THAT THE ASSESSEE WANTS TO REVIEW THE EAR LIER ORDER OF THE TRIBUNAL, WHICH IS NOT POSSIBLE. 5. WE HAVE HEARD BOTH THE SIDES AND PERUSED THE MAT ERIAL ON RECORD. THE TRIBUNAL IN EARLIER OCCASION FAIRLY CONSIDERED THE ENTIRE ARGUMENTS OF THE ASSESSEE AND HAS GIVEN A FI NDING AND - - MA 238 TO 240/15 ETC. 5 DECIDED THE ISSUE AGAINST THE ASSESSEE. NOW, THE A SSESSEES COUNSEL WANTS TO RE-ARGUE THE SETTLED ISSUE BY PUTT ING SOME ARGUMENTS. IN OUR OPINION, IF WE CONSIDER THE ARGU MENTS OF THE ASSESSEES COUNSEL, IT WILL AMOUNT TO REVIEW OF OUR EARLIER ORDER OF THIS TRIBUNAL, FOR WHICH, THE TRIBUNAL HAS NO PO WER. 6. IT IS WELL-SETTLED THAT STATUTORY AUTHORITY CAN NOT EXERCISE POWER OF REVIEW UNLESS SUCH POWER IS EXPRESSLY CONF ERRED. THERE IS NO EXPRESS POWER OF REVIEW CONFERRED ON THIS TRI BUNAL. EVEN OTHERWISE, THE SCOPE OF REVIEW DOES NOT EXTEND TO R EHEARING OF THE CASE ON MERIT. IT IS HELD IN THE CASE OF CIT V S. PEARL WOOLLEN MILLOS (2011) 330 ITR 164/(2010) 191 TAXMAN 286 (PU NJ. & HAR.) AS UNDER : THAT THE TRIBUNAL COULD NOT RE-ADJUDICATE THE MATT ER UNDER SECTION 254(2). IT IS WELL SETTLED THAT A STA TUTORY AUTHORITY CANNOT EXERCISE POWER OF REVIEW UNLESS SU CH POWER IS EXPRESSLY CONFERRED. THERE WAS NO EXPRESS POWER OF REVIEW CONFERRED ON THE TRIBUNAL. EVEN OTHERWISE, THE SCOPE OF REVIEW DID NOT EXTENT TO REHEARING A CASE ON THE MERITS. NEITHER BY INVOKING INHERENT POWER NOR THE PRINCIPLE OF MISTAKE OF COUR T NOT PREJUDICING A LITIGANT NOR BY INVOLVING DOCTRINE OF INCIDENTAL POWER, COULD THE TRIBUNAL REVERSE A DECI SION ON THE MERITS. THE TRIBUNAL WAS NOT JUSTIFIED IN RECALLING ITS PREVIOUS FINDING RESTORING THE ADDITI ON, MORE SO WHEN AN APPLICATION FOR THE SAME RELIEF HAD BEEN EARLIER DISMISSED. - - MA 238 TO 240/15 ETC. 6 7. THE SCOPE AND AMBIT OF APPLICATION OF SECTION 2 54(2) IS VERY LIMITED. THE SAME IS RESTRICTED TO RECTIFICATI ON OF MISTAKES APPARENT FROM THE RECORD. WE SHALL FIRST DEAL WITH THE QUESTION OF THE POWER OF THE TRIBUNAL TO RECALL AN ORDER IN ITS ENTIRETY. RECALLING THE ENTIRE ORDER OBVIOUSLY WOULD MEAN PAS SING OF A FRESH ORDER. THAT DOES NOT APPEAR TO BE THE LEGISLA TIVE INTENT. THE ORDER PASSED BY THE TRIBUNAL UNDER SECTION 254(1) I S THE EFFECTIVE ORDER SO FAR AS THE APPEAL IS CONCERNED. ANY ORDER PASSED UNDER SECTION 254(2) EITHER ALLOWING THE AME NDMENT OR REFUSING TO AMEND GETS MERGED WITH THE ORIGINAL ORD ER PASSED. THE ORDER AS AMENDED OR REMAINING UN-AMENDED IS THE EFFECTIVE ORDER FOR ALL PRACTICAL PURPOSE. AN ORDER UNDER SEC TION 254(2) DOES NOT HAVE EXISTENCE DE HORS THE ORDER UNDER SEC TION 254(1). RE-CALLING OF THE ORDER IS NOT PERMISSIBLE UNDER SE CTION 254(2). RECALLING OF AN ORDER AUTOMATICALLY NECESSITATES RE HEARING AND RE-ADJUDICATION OF THE ENTIRE SUBJECT-MATTER OF APP EAL. THE DISPUTE NO LONGER REMAINS RESTRICTED TO ANY MISTAKE SOUGHT TO BE RECTIFIED. POWER TO RECALL AN ORDER IS PRESCRIBED I N TERMS OF RULE 24 OF THE ITAT RULES, 1963, AND THAT TOO ONLY IN CA SE WHERE THE ASSESSEE SHOWS THAT IT HAD A REASONABLE CAUSE FOR B EING ABSENT - - MA 238 TO 240/15 ETC. 7 AT A TIME WHEN THE APPEAL WAS TAKEN UP AND DECIDED EX PARTE. JUDGED IN THE ABOVE BACKGROUND THE ORDER PASSED BY THE TRIBUNAL IS INDEFENSIBLE. 8. THE WORDS USED IN SECTION 254(2) ARE SHALL MAK E SUCH AMENDMENT, IF THE MISTAKE IS BROUGHT TO ITS NOTICE . CLEARLY, IF THERE IS A MISTAKE, THEN AN AMENDMENT IS REQUIRED T O BE CARRIED OUT IN THE ORIGINAL ORDER TO CORRECT THAT PARTICULA R MISTAKE. THE PROVISION DOES NOT INDICATE THAT THE TRIBUNAL CAN R ECALL THE ENTIRE ORDER AND PASS A FRESH DECISION. THAT WOULD AMOUNT TO A REVIEW OF THE ENTIRE ORDER AND THAT IS NOT PERMISSIBLE UND ER THE I T ACT. THE POWER TO RECTIFY A MISTAKE UNDER SECTION 254(2) CANNOT BE USED FOR RECALLING THE ENTIRE ORDER. NO POWER OF RE VIEW HAS BEEN GIVEN TO THE TRIBUNAL UNDER THE I T ACT. THUS, WHAT IT COULD NOT DO DIRECTLY COULD NOT BE ALLOWED TO BE DONE INDIRECTLY . 9. IN THE CASE OF CIT VS. HINDUSTAN COCA BEVERAGES (P) LTD. (2007) 293 ITR 163/159 TAXMAN 127 (DELHI), THE IR LORDSHIPS WHILE CONSIDERING THE POWERS OF THE TRIBUNAL UNDER SECTION 254(2) OF THE IT ACT, 1961 OBSERVED AS UNDER:- UNDER SECTION 254(2) OF THE IT ACT, 1961, THE TRIB UNAL HAS THE POWER TO RECTIFY MISTAKES IN ITS ORDER. HOW EVER, IT IS PLAIN THAT THE POWER TO RECTIFY A MISTAKE IS NOT EQUIVALENT TO A POWER TO REVIEW OR RECALL THE ORDER - - MA 238 TO 240/15 ETC. 8 SOUGHT TO BE RECTIFIED. RECTIFICATION IS A SPECIES OF THE LARGER CONCEPT OF REVIEW. ALTHOUGH IT IS POSSIBLE T HAT THE PRE-REQUISITE FOR EXERCISE OF EITHER POWER MAY BE SIMILAR) A MISTAKE APPARENT FROM THE RECORD), BY IT S VERY NATURE THE POWER TO RECTIFY A MISTAKE CANNOT R ESULT IN THE RECALL AND REVIEW OF THE ORDER SOUGHT TO BE RECTIFIED. IN VIEW OF THE ABOVE, WE ARE INCLINED TO REJECT THE ARGUMENTS OF THE ASSESSEES COUNSEL ON THE ISSUE OF VALUATION OF CLOSING STOCK IN ALL THESE MISC. APPLICATIONS. 10. THE NEXT GRIEVANCE OF THE ASSESSEE IN MA NOS. 2 40, 244 AND 248/MDS/2015 IS WITH REGARD TO CONFIRMING THE A DDITION TOWARDS STOCK DISCREPANCIES. 11. THE TRIBUNAL CONSIDERED THIS ISSUE IN PARA 18 O F ITS ORDER, WHICH READS AS FOLLOWS : 18. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. IT IS SEEN FROM THE RECORD S THAT THERE WAS DIFFERENCE BETWEEN PHYSICAL CLOSING STOCK AND BOOKS OF ACCOUNTS. THE MANAGING PARTNER, SHRI SHIVA KUMAR ADMITTED THAT THERE WAS DEFICIT STOCK O F ` 1,27,64,281/- AS A WHOLE. HE FURTHER ADMITTED THAT THERE WAS AN ERROR IN VALUATION OF STOCK IN THEIR S YSTEM FOR SOME PRODUCTS AND OFFERED THE DIFFERENCE IN STO CK VALUE FOR TAXATION AS INCOME IN THE FINANCIAL YEAR RELEVANT TO THE ASSESSMENT YEAR. THE ASSESSEE ADMITTED THE DIFFERENCE IN STOCK VALUE AT THE TIME OF SEARCH ACTION ON 17.2.2009 IN CHENNAI AND TIRUNELVE LI. IT IS ALSO BROUGHT ON RECORD BY THE AO THAT SHRI PONANAND IN HIS STATEMENT ON 19.2.2009 ADMITTED THE EXCESS STOCK FOUND AS COMPARED TO THE STOCK AS PER BOOKS OF ACCOUNT ON THE DATE OF SEARCH WHICH STOOD AT - - MA 238 TO 240/15 ETC. 9 ` 1,96,21,842/- AND IN ANSWER TO QUESTION NO.10, HE STATED THAT THERE ARE DUPLICATE ENTRIES WHILE TAKIN G THE STOCK. THE DETAILS OF BOOK STOCK SUBMITTED BY THE ASSESSEE DURING THE COURSE OF SEARCH OPERATION HAVE BEEN DOUBLE CHECKED AND IT IS CORRECT. SIMILARLY, THE PHYSICAL STOCK OF GOODS LYING IN VANNARAPETTAI SHOP AND ALSO TOWN SHOP WAS TAKEN WITH THE ACTIVE PARTICIPATION OF THEIR STAFF UNDER THEIR OWN SUPERV ISION AND VALUATION THEREOF HAS ALSO BEEN CHECKED, THE SAME IS FOUND TO BE CORRECT. HENCE, SUBJECT TO ANY DUPLICATE ENTRIES OR CHANGE IN THE DATES AS STATED ABOVE, HE ACCEPTED THE VALUE OF EXCESS STOCK FOUND DURING THE COURSE OF SEARCH TO BE OUT OF THEIR UNRECORDED INCOME AND AGREED TO PAY THE INCOME-TAX DUE ON SUCH INCOME FOR THE YEAR. DURING THE COURSE OF INVESTIGATION VIDE LETTER DATED 10.8.2009 SUBMITTED TO THE ADIT (INVESTIGATION) BY SRI SHIVA KUMAR, NO SPECIFIC ARGUMENTS RELATING TO THE FIGURES OF STOCK WERE RAISED EXCEPT POINTING OUT THAT THE PHYSICAL STOCK AT TIRUNELVELI WAS MENTIONED IN THE TABULATION REFLECT ING THE PHYSICAL STOCK FOR THE GROUP AS A WHOLE. THE S AID MISTAKE WAS RECTIFIED BY THE AO WHILE PASSING THE ORDER. THE AO AFTER CONSIDERING THE ENTIRE FACTS O F THE CASE, ADDED ` 9,43,980/- AS DISCREPANCY FOUND IN THE STOCK FOR THIS ASSESSMENT YEAR AT CHENNAI BRANCH AN D DETERMINED AT ` 1,11,827/- AT TIRUNELVELI BRANCH AND THE SAME WAS BROUGHT TO TAX AS UNRECORDED SALES. BEING SO, WE DO NOT FIND ANY INFIRMITY IN THE ORDER S OF THE LOWER AUTHORITIES. WE REJECT THIS GROUND OF AP PEAL IN ITA NO. 1780/MDS/2014. SIMILARLY, WE REJECT THI S GROUND IN ITA NO.1776/MDS/ 2014 ALSO ON THE SAME REASONING. THE SAME RATIO WAS APPLIED IN RESPECT OF ITA NOS.17 76 AND 1780/MDS/2014. 12. THE LD. AR, SUBMITTED THAT THE ASSESSEE HAS BEEN REPEATEDLY ASKING THE DEPARTMENT FOR THE LIST OF IN VENTORY - - MA 238 TO 240/15 ETC. 10 FOUND AT THE TIME OF SEARCH BUT HAVE NOT BEEN PROVI DED WITH SAME. EVEN BEFORE THE CIT(A), THE ASSESSEE HAD REQU ESTED FOR THE LIST OF STOCK TAKEN BY THE DEPARTMENT BUT T HE SAME WAS NOT FURNISHED. FURTHER, THE LD. AR SUBMITTED THAT THE AO HAS OBSERVED AS UNDER: 'THERE IS NO INVENTORY OF INDIVIDUAL BREAK UP OF PHYSICAL STOCK IDENTIFIED WITH REFERENCE TO BY- NUMBERS MADE OUT ON THE DATE OF SEARCH. THEREFORE IT IS NOT POSSIBLE AT THIS POINT OF TIME TO VERIFY WHETHER THE ITEMS WITH SPECIFIC BY-NUMBERS CLAIMED BY THE ASSESSEE FORMED PART OF THE PHYSICAL INVENTORY ON THE DAY OF SEARCH BUT SUBSEQUENTLY EITHER SOLD BEFORE 31/0312009 OR CONTINUE TO REMAIN UNSOLD AS ON 31/03/2009. ACCORDING TO THE LD. AR, IT IS APPARENT FROM THE AB OVE THAT AO DID NOT HAVE THE FULL PARTICULARS OF INVENTORY AVAI LABLE ON THE DATE OF SEARCH. IT IS THE CONTENTION OF THE ASSESSE E THAT INDIVIDUAL ITEMS ARE IDENTIFIABLE BY THE BY-NUMBERS ALLOTTED AT THE TIME OF PURCHASE. THE ENTIRE STOCK RECORDS HAVE BEEN COMPUTERISED AND THE HISTORY OF EACH TIME FROM PURC HASE TO SALE IS IMMEDIATELY AVAILABLE. HENCE, HE SUBMITTED THAT IF THE PARTICULARS OF THE STOCK TAKEN AT THE TIME OF SEARC H ARE FURNISHED, THE SAME COULD BE EASILY VERIFIED. FURT HER, THE LD. AR SUBMITTED THAT THE PURCHASES AFTER THE SEARCH DA Y, SALES - - MA 238 TO 240/15 ETC. 11 AND CLOSING STOCK AT THE END OF THE YEAR HAS BEEN A CCEPTED BY THE DEPARTMENT. AS THE FIGURES OF PURCHASES, SAL ES AND VALUE CLOSING STOCK AFTER SEARCH HAS BEEN ACCEPTED AS RETURNED BY THE ASSESSEE, THERE CANNOT BE ADDITION TO CLOSING DAY STOCK. 12.1 THE LD. AR, FURTHER, SUBMITTED THAT H AVING ACCEPTED THAT THEY DO NOT HAVE THE PARTICULARS OF THE SEARCH DAY STOCK, THERE CAN BE NO ADDITION ON THAT COUNT. ACCORDING TO TH E LD. AR, THE TRIBUNAL HAS NOT APPRECIATED THE CONFIRMATION BY TH E AO THAT THEY DO NOT HAVE PARTICULARS OF SEARCH DAY STOCK TAKEN BY THE DEPARTMENT. HENCE THERE CANNOT BE ANY ADDITION ON T HIS COUNT AND THE ADDITION ON THIS ACCOUNT REQUIRES TO BE DEL ETED. 12.2 THE LD. AR FURTHER SUBMITTED THAT IT IS NOT OPEN TO THE DEPARTMENT TO CONTEND THAT THERE WAS DISCREPANCY IN THE STOCK RECORDS OF THE ASSESSEE IN THE LIGHT OF THE FACT TH AT THE ASSESSEE HAD ALL THE RECORDS TO PROVE THAT THEY WERE, WITH T HEIR BOOKS AND INVENTORY RECORDING SYSTEM, ABLE TO BRING OUT THE F ACT THAT THE INVENTORY AS PER BOOKS WAS CORRECT WHILE THE DEPART MENT EITHER DID NOT HAVE FULL PARTICULARS OF THE INVENTORY ON T HE DATE OF SEARCH - - MA 238 TO 240/15 ETC. 12 OR THE INVENTORY LIST TAKEN BY THEM AND IN POSSESSI ON OF THE DEPARTMENT SUFFERED FROM SERIOUS SHORT COMINGS. AC CORDINGLY, HE PRAYED THAT THE TRIBUNAL MAY BE APPRECIATED THE ABOVE ASPECTS AND FACTS OF THE CASE. 13. THE LD. DR RELIED ON THE ORDER OF THE TRIBUNAL. 14. AS DISCUSSED EARLIER, THE TRIBUNAL HAS CONSIDER ED THE ISSUE IN DISPUTE AND CATEGORICALLY GIVEN A FINDING AND DECIDED THE ISSUE AGAINST THE ASSESSEE AND THERE IS NO REASON T O RECALL THE EARLIER ORDER OF THE TRIBUNAL. BEING SO, AS DISCUS SED IN EARLIER PARA, WE ARE INCLINED TO REJECT THE ARGUMENTS OF TH E LD. AR IN ALL THESE THREE MISC. APPLICATIONS, ON THIS ISSUE. 15. THE NEXT GRIEVANCE OF THE ASSESSEE IN MA NOS. 2 40, 244 AND 248/MDS/2015 IS WITH REGARD TO CONFIRMING THE D ISALLOWANCE TOWARDS LEASE COMMITMENT CHARGES. ON THIS ISSUE AL SO, THE TRIBUNAL HAS GIVEN A FINDING IN PARAS 9 TO 9.3 BY O BSERVING THAT IT IS NOT AN EXPENDITURE INCURRED FOR THE PURPOSE OF B USINESS. THERE IS NOTHING ON RECORD TO INDICATE THAT THE ASS ESSEE HAS ACQUIRED ANY BUSINESS ADVANTAGE OUT OF SUCH EXPENDI TURE. 16. NOW, THE LD. AR, SUBMITTED BEFORE US, THAT THE A SSESSEE HAS EXPLAINED IN THE BUSINESS EXIGENCY IN OBTAINING THE LEASE. - - MA 238 TO 240/15 ETC. 13 IT WAS TO OBTAIN THE ACCESS TO LAND FOR PARKING CAR S OF THE CUSTOMERS COMING TO THE SHOP FOR PURCHASING CLOTHES . PARKING SPACE FOR CUSTOMERS IS ONE OF THE IMPORTANT FACILIT Y WHICH WILL DIRECTLY IMPROVE AND HELP THE BUSINESS OF THE ASSES SEE. ACCORDING TO THE LD. AR, THE EXPENSES CLAIMED BY TH E ASSESSEE WAS PROPORTIONATE TO THE NUMBER OF CUSTOME RS TO ASSESSEE'S SHOPS TO THE ESTIMATED TOTAL CUSTOMERS EXPECTED TO USE THE PARKING SPACE. AS THE LEASE IS ONLY FOR A PERIOD OF THREE YEARS THE EXPENSES WERE CLAIMED AS REVENUE EXPENDITURE. FURTHER, THE LD. AR SUBMITTED THAT IT WAS CLEARLY REITERATED IN THE SUBMISSIONS TO THE CIT(APPEALS) A ND ALSO TO THE ITAT THE FOLLOWING IMPORTANT ASPECT TO THE TRAN SACTION VIZ. 'ABOVE LANDED PROPERTIES WERE ACQUIRED WITH THE EXPLICIT UNDERSTANDING THAT THE COMMERCIAL EXPLOITATION OF THE ABOVE PROPERTIES WILL BE ENJOYED BY THE RM.KV.GROUP OF CONCERNS AND NEITHER SRI K MAHESH NOR THE OTHER CO-OWNERS HAD ENVISAGED ANY BUSINESS INTEREST OF THEIR OWN AT ANY POINT IN THE SAME. IN ESSENCE, THE ENTIRE TRANSACTION WAS CONCEIVED ONLY TO BENEFIT THE 'RMKV GROUP' OF BUSINESS CONCERNS.' (PARA NO.1 OF THE STATEMENT OF FACTS MADE TO CIT (APPEALS). ACCORDING TO THE LD. AR, THE SAME FACTS WERE REITER ATED BEFORE THE TRIBUNAL ALSO (AS PER PARA 3.5 TO 3.9 OF THE GR OUNDS OF - - MA 238 TO 240/15 ETC. 14 APPEAL) AND THE ABOVE REASON FOR PAYING THE CHARGES FOR OBTAINING THE RIGHT TO USE THE LAND HAS NOT BEEN AP PRECIATED BY THE TRIBUNAL. WITHOUT PREJUDICE TO THE ABOVE SU BMISSIONS, THE ASSESSEE HAS ACQUIRED COMMERCIAL RIGHT WHICH IS ENTITLED TO DEPRECIATION. HENCE, HE PRAYED THAT THE ORDER OF THE TRIBUNAL MAY BE RECALLED TO CONSIDER THE ABOVE FACT S SUBMITTED BEFORE THE AUTHORITIES. 17. THE LD. DR RELIED ON THE ORDER OF THE TRIBUNAL. 18. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. ON THIS ISSUE ALSO, THE TRIBUNAL HAS GI VEN A FINDING THAT THE EXPENDITURE OF ` ONE CRORE INCURRED BY THE ASSESSEE TOWARDS LEASE COMMITMENT CHARGES CANNOT BE CONSIDER ED AS WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF BUSINESS. HENCE, IT IS DECIDED AGAINST THE ASSESSEE. NOW, THE ASSESSEES COUNSEL WANTS TO RE-ARGUE THE CASE AND IT CANNOT BE POSSIBL E. AS DISCUSSED IN EARLIER PARA, WE ARE INCLINED TO REJEC T THE ARGUMENTS OF THE LD. AR IN ALL THESE THREE MISC. APPLICATIONS , ON THIS ISSUE ALSO. 19. THE NEXT GRIEVANCE OF THE ASSESSEE IN MA NO.240/MDS/2016 IS WITH REGARD TO ADDITION OF ` 29,92,775/- - - MA 238 TO 240/15 ETC. 15 TOWARDS UNEXPLAINED JEWELLERY. 20. THE LD. AR, BEFORE US, NOW, SUBMITTED THAT THE ASSESSEE HAS RAISED A SPECIFIC GROUND BEFORE THE CIT(APPEALS) CHALLENGING THE ADDITION MADE TOWARDS UNEXPLAINED JEWELLERY. HOWEVER THE SAME WAS NOT ADJUDICATED BY THE CIT(APPEALS). THEREFORE, THE LD . AR SUBMITTED THAT THE ASSESSEE RAISED THE GROUND NO.7 BEFORE THE TRIBUNAL CHALLENGING THE ORDER OF CIT(APPEALS) FOR NOT ADJUDICATING THE GROUND IN THE APPEAL CHALLENGING T HE ADDITION OF ` 29,92,775/-. THE TRIBUNAL WITHOUT CONSIDERING THE GROUNDS OF APPEAL RAISED BEFORE THE CIT(APPEALS ) CAME TO THE CONCLUSION THAT THIS GROUND WAS NOT FOUND IN PARA 4 TO 8 OF CIT(APPEALS) ORDER AND HENCE THEY WERE NOT IN A POSITION TO ACCEPT THE PLEA OF THE ASSESSEE. THERE FORE, THE LD. AR SUBMITTED THAT THE TRIBUNAL MAY BE APPRECIAT ED THE ABOVE ASPECTS. 21. THE LD. DR RELIED ON THE ORDER OF THE TRIBUNAL. 22. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. THE TRIBUNAL HAS GIVEN THE FIN DING ON THIS ISSUE IN PARA 45 OF ITS ORDER, AS FOLLOWS: - - MA 238 TO 240/15 ETC. 16 45. THE NEXT GROUND IN ITA NO.1772/MDS/2014 IS WIT H REGARD TO UNEXPLAINED JEWELLERY OF ` 29,92,775/-. AS SEEN FROM THE GROUNDS OF APPEAL BEFORE CIT(APPEALS) AS REPRODUCED BY THE CIT(APPEALS) IN PAGE NO.2 PARAGR AHS 4 TO 8, WE FIND NO PLACE FOR THAT GROUND. HOWEVER, W E FIND UNSIGNED COPY OF GROUNDS ON OUR RECORDS, WHEREIN TH E ASSESSEE RAISED UNEXPLAINED JEWELLERY U/S.69A OF TH E ACT. BEING SO, WE ARE NOT IN A POSITION TO UPHOLD THE AR GUMENT OF THE ASSESSEES COUNSEL. ACCORDINGLY, THIS GROUND IS DISMISSED AND ITA NO 1769/MDS/14 IS PARTLY ALLOWED AND ITA NOS. 1770 TO 1772/MDS/14 PARTLY ALLOWED FOR STA TISTICAL PURPOSES. NOW, THE ASSESSEES COUNSEL WANTS TO REVIEW THE ORD ER OF THE TRIBUNAL, WHICH IS NOT PERMITTED U/S.254(2) OF THE ACT. ACCORDINGLY, WE REJECT THE MISC. APPLICATIONS FILED BY THE ASSESSEE. 23. IN THE RESULT, ALL THE MISC. APPLICATIONS FIL ED BY THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED ON WEDNESDAY, THE 27 TH OF APRIL, 2016 AT CHENNAI. SD/- SD/- ( . ! '#$ ) ( %&' ( ) ) ( DUVVURU RL REDDY ) (CHANDRA POOJARI) 6 78 /JUDICIAL MEMBER ' 78/ACCOUNTANT MEMBER %'6 /CHENNAI, B7& /DATED, THE 27 TH APRIL, 2016. MPO* - - MA 238 TO 240/15 ETC. 17 7'C D E F'E /COPY TO: 1. /APPELLANT 2. /RESPONDENT 3. G ( ) /CIT(A) 4. G /CIT 5. EHI J /DR 6. I$ K /GF.