The DCIT(OSD)Circle-9, Ahmedabad V. M/s. Gajanan Developers, Ahmedabad

MA 35/AHD/2013

• Counselvise Citation: [2014] 124 COUNSELVISE.COM (IT) 1758 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 2 month(s) 11 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 16-05-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 02-05-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 06-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P L KUREEL
• Keywords: Unexplained expenditure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD (BEFORE SHRI G.C.GUPTA VICE PRESIDENT & SHRI ANIL C HATURVEDI, A.M.) M. A. NO. 35 /AHD/2013 (IN ITA NO. 2863/AHD/09) (ASSESSMENT YEAR: 2006-07) THE ITO, WARD-9(2), AHMEDABAD V/S M/S. GAJANAN DEVELOPERS C/O. KAMLESHBHAI R. PATEL 37,SWAMI AKHAND ANAND SOCIETY, GATE NO. 4, K.K. NAGAR, GHATLODIYA, AHMEDABAD (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI P.L. KUREEL, SR. D.R. RESPONDENT BY : SHRI MANISH SHAH ( )/ ORDER DATE OF HEARING : 02-05-20 14 DATE OF PRONOUNCEMENT : 16 -05-2014 PER SHRI ANIL CHATURVEDI,A.M. 1. BY THIS MISCELLANEOUS APPLICATION, REVENUE HAS REQU ESTED FOR RECALLING OF THE ORDER DATED 05-10-2012 PASSED BY THE ITAT AH MEDABAD BENCH-C IN ITA.NO.2863/AHD/2009 FOR THE ASSESSMENT YEAR 200 6-07. IN THE MISCELLANEOUS APPLICATION, THE REVENUE HAS SUBMITT ED AS UNDER:- 3. ON PERUSAL OF THE ORDER OF THE HON'BLE ITAT, IT WAS NOTICED THAT THE ADDITION U/S.69C OF THE I. T. ACT WAS RESTRICTED TO RS.31,46,500/- INSTEAD OF THE ORI GINAL ADDITION MADE BY THE AO OF RS.1,32,56,366/- O N THE BASIS OF THE CHART PREPARED (COPY ENCLOSED) DUR ING THE COURSE OF HEARING BEFORE THE ITAT. NOW THE SAID CHART HAS BEEN OBTAINED AND AFTER PERUSAL OF T HE SAME, IT IS SEEN THAT THE AMOUNT OF RS.31,46,000 /- HAS BEEN ARRIVED AT BY INCLUDING THE FOLLOWING AMOU NTS:- I) AMOUNT REFLECTED IN COL. NO.3 I.E. PAID FOR EXPENSE S WHICH HAS TOTAL OF RS.14,69,500/- PLUS AMOUNT REFLECTED IN COL. NO.5 I.E. REMARKS WHERE IT IS CLARIFIED AS TO ON WHAT GROUND THE AMOUNT WAS RETURNED I.E. BORROWED FUNDS OR REIMBURS EMENT OF EXPENSES INCURRED ON ASSESSEE'S BEHALF DULY REDUCED BY THE BORROWED AMOU NTS RETURNED / REPAID. MA NO 35/A/13 (IN IT A NO. 2863/A/09) . A.Y. 2006- 07 2 II) HOWEVER, AFTER PERUSAL OF THE SAID CHART, IT IS FOU ND THAT THE AMOUNT THAT WHICH SHOULD HAVE BEEN CONFIRMED FOR ADDITION U/S.69C OF THE ACT IS T HE AMOUNT OF 'PAID FOR EXPENSES' RS.14,69,500/- PLUS THE AMOUNTS REIMBURSED ON ACCOU NT OF EXPENSES INCURRED BY OTHERS (I.E. RS.41,16,000/- AS WORKED OUT IN THE CHART ON THE BA SIS OF NARRATION IN COL. 5 I.E. TOTAL RS.55,85,500/-. III) ON PERUSAL OF THE CHART SHOWING WORKING OF THE AMOU NT TO BE CONFIRMED AS ADDITION U/S.69C OF THE ACT, IT IS SEEN THAT AFTER DOING THE EXERCIS E OF ADDING THE AMOUNT OF RS.14,69,500/- & RS.41,16,000/-, THE ITAT HAS GRANTED REDUCTION OF R S.24,39,000/- ON ACCOUNT OF THE SAME REPRESENTING THE AMOUNTS RETURNED / REPAID & THEREB Y ARRIVING AT THE AMOUNT OF RS.31,46,500/-. HOWEVER, AS IS EVIDENT FROM THE ABOVE, THE SAID AMOUNT OF REPAID / RETURNED AMOUNTS HAVE NOT BEEN INCLUDED IN THE CALCULATION OF THE AMOUNTS OF RS.14 ,69,500/- & 41,16,000/-REDUCTION GRANTED FOR RS.24,39,000/- IS PART OF ORIGINAL ADDITION OF RS. 1,32,57,366/- WHICH HAS NOT BEEN CONFIRMED BY THE I TAT. THE REDUCED AMOUNT OF RS.24,39,000/- IS FROM RS.41,16,000/- WHICH IS TO B E TAXED BEING AMOUNT PAID FOR EXPENDITURE OF WHICH SOURCE IS NOT EXPLAINED. SO THE ITAT HAS IN PRINCIPLE WRONGLY ALLOWED REDUCTION FROM AMOUNT WHICH WAS ALREADY PAID FOR UNACCOUNTED EXPENDITURE. THIS AMOUNT WAS NOT BROUGHT TO TAX U/S.68 OF THE ACT, SO COULD NOT HAVE BEEN REDUCED FROM AMOUNT OF UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. HENCE, IT IS EVIDEN T THAT THE HON'BLE ITAT HAVE ALLOWED SUCH DEDUCTION WITHOUT APPRECIATION OF THE FACTS OF THE TRANSACTIONS & THEREFORE, THE DECISION OF ITAT IS PERVERSE OF THIS ISSUE AND IS REQUIRED TO B E RECALL AND RECTIFY THE MISTAKE. 2. BEFORE US, LEARNED DR, REITERATED THE SUBMISSIONS M ADE IN THE APPLICATION AND FURTHER SUBMITTED THAT THE CHART WHICH WAS REFE RRED AND CONSIDERED BY THE HONBLE TRIBUNAL FOR GRANTING RELIEF WAS NOT CO RRECT AND THEREBY THE RELIEF WHICH WAS GRANTED WAS ALSO NOT CORRECT AND T HEREFORE THERE IS MISTAKE APPARENT WHICH NEEDS TO BE CORRECTED AND TH EREFORE THE ORDER BY RECALLED. THE LD. A.R. ON THE OTHER HAND OBJECTED T O THE SUBMISSIONS OF THE ID. DR. HE SUBMITTED THAT AT THE TIME OF HEARIN G OF THE APPEAL, ON THE QUERY FROM THE BENCH, BOTH THE PARTIES AFTER CHECKI NG INDEPENDENTLY HAD AGREED TO THE FIGURE OF ADDITION AND THEREAFTER REL IEF WAS GRANTED. HE FURTHER SUBMITTED THAT SINCE THE FIGURES WAS ACCEPT ED BY REVENUE AS CORRECT THE TIME OF HEARING, NOW THE REVENUE CANNOT TURN UP TO SAY THAT THE FIGURES OF THE CHART WAS INCORRECT. HE THEREFO RE SUBMITTED THAT THERE IS NO MISTAKE IN THE ORDER OF TRIBUNAL. MA NO 35/A/13 (IN IT A NO. 2863/A/09) . A.Y. 2006- 07 3 3. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS AND, PERUSED THE MATERIAL ON RECORD. WE FIND THAT THE TRIBUNAL HAS N OTED AS UNDER WHILE RESTRICTING THE ADDITION. '9.... ON THE BASIS OF QUERY FROM THE BENCH, THE LD AR AGREED TO VERIFY THE FIGURES AND AFTER VERIFICATION RECALCULATED THE FIGURES AFTER CONSIDE RING THE AMOUNTS REPAID/RETURNED TO THE PARTNERS AN D THE NET FIGURE OF EXPENSES WORKED OUT TO RS 31,46,5 00/-. THIS FIGURE WAS ALSO CHECKED AND CONFIRMED BY THE REVENUE. THE LD AR SUBMITTED THAT INSTEAD OF ADDITION OF RS 1,32,56,366/- MADE BY THE AO THE ADDITION COULD BE MADE OF RS 31,46,500/-. IN VIEW O F THESE FACTS, WE ARE OF THE VIEW THAT THE ADDITION MADE BY THE AO BY RESTRICTED TO RS 31,46,500/- INST EAD OF RS 1,32,57,366/- MADE BY HIM. WE THEREFORE DIRECT ACCORDINGLY.....' (EMPHASIS SUPPLIED) 4. IT IS THUS SEEN THAT THE WORKING OF THE ADDITION WA S CONFIRMED BY BOTH THE PARTIES BEFORE THE TRIBUNAL. FURTHER THE REVENUE CO ULD NOT POINT OUT ANY APPARENT MISTAKE OF THE TRIBUNAL WHICH NEEDS CORREC TION. FURTHER, A MISTAKE CAPABLE OF RECTIFICATION U/S. 254(2) IS ONE WHICH IS PATENT, OBVIOUS AND WHOSE DISCOVERY IS NOT DEPENDENT ON ARG UMENT. FURTHER A MISTAKE WHICH MAY BE DISCOVERED BY A COMPLICATED PR OCESS OF INVESTIGATION, ARGUMENT OR PROOF CANNOT BE RECTIFIE D U/S. 254(2). FURTHER, IF THE PRAYER MADE BY THE REVENUE IN ITS MISCELLANE OUS APPLICATION IS ACCEPTED, IT WILL AMOUNT TO REVIEW OF OUR ORDER. TH E LAW IS SETTLED THAT THE TRIBUNAL HAVE NO POWER TO REVIEW THE ORDER. 5. IN THE CASE OF PERFETTI VAN MELLE INDIA (P) LTD. VS . CIT (2008) 296 ITR 595 (DEL) THE HON'BLE HIGH COURT HAS CONCLUDED THAT ASSESSEE CANNOT BE ALLOWED TO REOPEN AND REARGUE THE WHOLE MATTER IN T HE GARB OF RECTIFICATION UNDER SECTION. 254(2). IT HAS HELD AS UNDER:- 'IT IS WELL SETTLED THAT AN OVERSIGHT OF A FACT CAN NOT CONSTITUTE AN APPARENT MISTAKE RECTIFIABLE UNDE R S. 254(2). ...... FURTHER, IN GARB OF APPLICATION FOR RECTIFICATION, THE ASSESSEE CANNOT BE ALLOWED TO BE PERMITTED TO REOPEN AND REARGUE THE WHOLE MATTER, W HICH IS BEYOND THE SCOPE OF THIS SECTION.' MA NO 35/A/13 (IN IT A NO. 2863/A/09) . A.Y. 2006- 07 4 6. IN VIEW OF THE ABOVE AND FOLLOWING THE DECISION OF HONBLE HIGH COURT CITED ABOVE, WE ARE OF THE VIEW THAT SINCE THE REVE NUE HAS FAILED TO POINT OUT ANY MISTAKE APPARENT FROM RECORD IN OUR ORDER, THE MISCELLANEOUS APPLICATION IS HEREBY DISMISSED. 7. IN THE RESULT, THE M.A. IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 16 - 05 - 2014. SD/- SD/- (G.C.GUPTA) (ANIL CHATURVEDI) VICE PRESIDENT ACCOUNTANT MEMBER AHMEDABAD. TRUE COPY RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD