Income-tax Officer, V. Shri Vishwas V. Deshmukh (HUF), Pune

MA 44/PUN/2015

• Counselvise Citation: [2016] 124 COUNSELVISE.COM (IT) 4137 (ITAT-PUNE)
• Duration Of Justice: 4 month(s) 8 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 29-02-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 21-10-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUNIL PATHAK
• Assessee Lawyers: HITENDRA NINAWE ING H
• Section: 148

Judgement Text

] IQ.KS ] IQ.KS ] IQ.KS ] IQ.KS IQ.KS IQ.KSIQ.KS IQ.KS IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE , . . , # BEFORE MS. SUSHMA CHOWLA, JM AND SHRI R.K. PANDA, AM $$ . / MA NO.44/PN/2015 (ARISING OUT OF ITA NO.841/PN/2013) ASSESSMENT YEAR : 2005-06 ITO, WARD-3(1), PUNE . / APPLICANT V/S SHRI VISHWAS V. DESHMUKH (HUF), 110/7, JAYKAMAL APARTMENT, THORAT COLONY, PUNE 411004 PAN NO. AABJV9465R . / RESPONDENT / APPLICANT BY : SHRI SUNIL PATHAK / RESPONDENT BY : S SHRI HITENDRA NINAWE ING H / ORDER PER R.K. PANDA, AM : THE REVENUE THROUGH THIS MISCELLANEOUS APPLICATION REQUEST S THE TRIBUNAL TO CLARIFY THE DIRECTIONS GIVEN TO TAKE RECO URSE OF THE PROVISIONS OF SECTION 150 IN THIS CASE FOR A.Y. 2005-06. 2. THE CONTENTS OF THE MISCELLANEOUS APPLICATION BY THE REVENUE READ AS UNDER : / DATE OF HEARING : 19.02.2016 / DATE OF PRONOUNCEMENT:29.02.2016 2 MA NO.44/PN/2015 KIND REFERENCE IS INVITED TO THE ABOVE. 02. A MISCELLANEOUS APPLICATION IS BEING FILED BEFORE THE HON'BLE INCOME TAX APPELLATE TRIBUNAL, 'B' BENCH, PUNE IN T HE CASE OF SHRI VISHWAS VISHWANATH DESHMUKH (HUF) FOR A.Y.2005-06 AGAIN ST ITA NO.841/PN/2013 DATED 31.10.2014. 03 THE BRIEF FACTS OF THE CASE IS AS UNDER : THE ASSESSEE HUF RECEIVED INTEREST AMOUNTING TO RS.73,53, 513/- FROM THE APPROPRIATE AUTHORITY ON SALE CONSIDERATION RECEI VABLE FOR ACQUISITION PROPERTY BY APPROPRIATE AUTHORITY IN VIE W OF THE DECISION OF HON'BLE GUJARAT HIGH COURT. THE ASSESSEE IN ITS RETUR N OF INCOME FOR A.Y.2005-06 DID NOT OFFER THE SAID INTEREST AS 'INCOME FROM OTHER SOURCES' ON THE PRETEXT THAT THE DEPARTMENT HAS FILED SPECIAL LEAVE PETITION (SLP) AGAINST THE ORDER OF THE HON'BLE HIGH COURT. THE ASSESSING OFFICER MADE AN ADDITION OF RS.73,53,513/- AS I NCOME FROM OTHER SOURCES. ON THE APPEAL FILED BY THE ASSESSEE THE CI T(A) -II, CONFIRMED THIS ADDITION AND THE ASSESSEE FILED AN APPEA L BEFORE THE HON'BLE INCOME-TAX APPELLATE TRIBUNAL AGAINST THE OR DER OF THE CIT(A). 04. THE HON'BLE INCOME TAX APPELLATE TRIBUNAL PUN E VIDE ITS ORDER DATED 31/10/2014 AT PARA NO.9.3 ON THE ABOVE ISSUE OB SERVED AS UNDER: 'NOW COMING TO THE TAXABILITY OF THE INTEREST INCOME ON ACCRUAL BASIS/ WE FIND SOME FORCE IN IT. ADMITTEDLY, THE INTEREST SO RECEIVED WAS ON ACCOUNT OF ACCRUAL OF INTEREST ON THE FDR FOR THE PE RIOD FROM 30/10/1996 TILL IT WAS ENCASHED DURING THE RELEVANT A SSESSMENT YEAR. THE FD WAS GETTING RENEWED FROM TIME TO TIME. THE IN TEREST SO RECEIVED IS NOT ON ACCOUNT OF COMPENSATION FOR DELAYE D PAYMENT. THEREFORE/ WE ARE OF THE CONSIDERED OPINION THAT INT EREST RELATABLE TO THIS ASSESSMENT YEAR SHOULD BE BROUGHT TO TAX IN THE HAND S OF THE ASSESSEE FOR THE IMPUGNED ASSESSMENT YEAR. THE ASSESSING OFFICE R, HOWEVER, MAY TAKE RECOURSE TO THE PROVISIONS OF SECTION 150 FOR BRINGING TO TAX REMAINING INTEREST IN THE RESPECTIVE ASSESSMENT YEARS AS PER THE PROVISIONS OF THE INCOME TAX ACT AND AS PER LAW. WE HOLD AND DIRECT ACCORDINGLY. '150 (1) NOT WITHSTANDING ANYTHING CONTAINED IN SECTION 149, THE NOTICE UNDER SECTION 148 MAY BE ISSUED AT ANY TIME FOR THE PURPOSE OF MAKING AN ASSESSMENT OR REASSESSMENT OR RECOMPUTATION IN CONSEQUENCE OF OR TO GIVE EFFECT ANY FINDING OR DIRECTION CONTAINED IN AN ORDER PASSED BY ANY AUTHORITY IN ANY PROCEEDINGS UNDER THIS ACT BY WAY OF APPEAL, REFERENCE OR REVISION OR BY A COURT IN ANY PROCEEDING UNDER ANY OTHER LAW.' THIS SECTION ENABLES TO REASSESS THE INCOME OF ANY YEAR WI THOUT LIMITATION OF TIME AS PROVIDED IN SECTION 149, IN CON SEQUENCE OF ANY APPEAL ETC. 05. IN THE CASE OF THE ASSESSEE, THE INCOME HAS ACCRUED TO THE ASSESSEE FROM AY. 1997-98 TO AY. 2005-06. THE ASSESSING OFFICER WAS DIRECTED TO TAKE RECOURSE TO THE PROVISIONS OF SECTION 150 TO TAX T HE INTEREST ACCRUED DURING THE A.Y. 1997-98 TO A.Y.2004-05 ON A CCRUAL BASIS. ON THE SIMPLE UNDERSTANDING OF THE ITAT ORDER, THE INCOM E SHOULD BE 3 MA NO.44/PN/2015 TAXED IN NINE YEARS FROM AY.1997-98 TO AY.2005-06. H OWEVER SECTION 150 (2) PROVIDES THAT: '(2) THE PROVISION OF SUB-SECTION (I) SHALL NOT APPLY IN ANY CASE WHERE ANY SUCH ASSESSMENT, REASSESSMENT OR RE-COMPUTATION AS IS REFERRED TO IN THAT SUB-SECTION RELATES TO AN ASSESSMENT YEAR IN RESPECT OF WHICH AN ASSESSMENT, REASSESSMENT OR RE-COMPUTATION COULD NO T HAVE BEEN AT THE TIME OF THE ORDER WHICH WAS THE SUBJECT MATTER OF THE APPEAL, REFERENCE OR REVISION, AS THE CASE MAY BE, WAS MADE BY REASON OF ANY OTHER PROV ISION LIMITING THE TIME WITHIN WHICH ANY ACTION FOR ASSESSMEN T, REASSESSMENT OR RE-COMPUTATION MAY BE TAKEN.' 06. THE ASSESSMENT ORDER U/S.143(3) R.W.S 147 OF THE ACT IN THIS CASE WAS PASSED ON 2-12-2011, AS SUCH THE ASSESSMENTS FOR THE ASSESSME NT YEARS 2005-06 TO 2010-11 ONLY COULD BE RE-OPENED FOR REASSESSMENT. NOTICE U/S.148 CANNOT BE ISSUED FOR ANY YEAR PRIOR TO A.Y. 2005-06, EVEN THOUGH THE INTEREST EARNED BY THE ASSESSEE HAS TO B E TAXED ON ACCRUAL BASIS IN THE EARLIER YEARS AS PER THE DIRECTIO N OF THE HON'BLE ITAT. 07. SINCE, DUE TO THE RESTRICTION AS PER THE PROVISIO NS OF SECTION 150(2) OF THE ACT, THE INCOME MAY NOT BE TAXED IN THE EARL IER YEARS. THIS ISSUE DOES NOT SEEM TO HAVE BEEN BROUGHT TO THE NOTICE OF T HE HON'BLE ITAT IN THIS CASE. IT IS, THEREFORE, PRAYED THAT THE MISCELLANEOUS APPLIC ATION WITH A PRAYER TO CLARIFY THE DIRECTIONS GIVEN TO TAKE RECOU RSE OF THE PROVISIONS OF SECTION 150 IN THIS CASE FOR A.Y.2005-06 MAY KINDL Y BE ADMITTED. 3. AFTER CONSIDERING THE CONTENTS OF THE MISCELLANEOUS APPLICATION AND THE ARGUMENTS ADVANCED BY THE LD. DEPAR TMENTAL REPRESENTATIVE WHO BASICALLY RELIED ON THE CONTENTS OF TH E MISCELLANEOUS APPLICATION, WE DO NOT FIND ANY MERIT IN THE SA ME. THE TRIBUNAL HAS CATEGORICALLY HELD THAT INTEREST INCOME H AS TO BE TAXED ON ACCRUAL BASIS. ACCORDINGLY, A DIRECTION WAS GIVEN TO TAX THE INTEREST THAT HAS ACCRUED DURING A.Y. 2005-06 IN TH E A.Y. 2005- 06 AND FOR THE OTHER YEARS THE INTEREST INCOME HAS TO BE TAXED ON ACCRUAL BASIS. ACCORDINGLY, A DIRECTION WAS GIVEN TO TAKE RECOURSE TO THE PROVISIONS OF SECTION 150 FOR BRINGING TO TAX OF T HE REMAINING INTEREST IN THE RESPECTIVE ASSESSMENT YEARS AS PER THE PROVISIONS OF THE I.T. ACT AND AS PER LAW. IF THE ACT DOES NOT PERMIT THE REVENUE TO BRING TO TAX THE INTEREST INCOME OF THE RESPECTIVE A SSESSMENT 4 MA NO.44/PN/2015 YEARS DURING WHICH IT HAS ACCRUED, THE TRIBUNAL CANNOT HE LP IT. IF THE DEPARTMENT COULD NOT DISCOVER TO BRING TO TAX THE INTEREST INCOME IN THE RESPECTIVE ASSESSMENT YEARS THE TRIBUNAL CANNOT COME TO ITS RESCUE. THE REVENUE THROUGH THIS MISCELLANEO US APPLICATION REQUESTS THE TRIBUNAL TO RECTIFY ITS ORDER WHICH AMOU NTS TO REVIEW OF ITS OWN ORDER WHICH IS NOT PERMISSIBLE IN LAW. I N VIEW OF THE ABOVE, WE DO NOT FIND ANY MERIT IN THE MISCELLANEOUS APPLICATION FILED BY THE REVENUE. ACCORDINGLY, THE SAME IS DISMISSED. 4. IN THE RESULT, THE MISCELLANEOUS APPLICATION FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 29-02-2016. SD/- SD/- ( SUSHMA CHOWLA ) ( R.K. PANDA ) JUDICIAL MEMBER ACCOUNTANT MEMBER IQ.KS PUNE ; DATED : 29 TH FEBRUARY, 2016. LRH'K ' (*$ +$ / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. % ( ) - THE CIT(A)-II, PUNE 4. % S / THE CIT-II, PUNE 5. ( ++, , , , IQ.KS / DR, ITAT, A PUNE; 6. 0 / GUARD FILE. / BY ORDER , ( + //TRUE COPY// //TRUE COPY// 23 + , / SR. PRIVATE SECRETARY ,, IQ.KS / ITAT, PUNE