ACIT, Coimbatore V. Sri Balaji Real Estates, Pollachi

MA 6/CHNY/2021

AI Insights

The case involves the Assistant Commissioner of Income Tax, Non Corporate Circle -4, Coimbatore, as the petitioner, and M/s. Sri Balaji Real Estates as the respondent. The revenue filed a Miscellaneous Application under section 254(2) of the Income-tax Act, 1961, against the Tribunal's order dated 24.10.2019, which pertained to the assessment year 2011-12. The revenue contended that the Tribunal had overlooked certain facts and evidence regarding a civil suit and the payment of Rs. 6,50,00,000 in its earlier decision. The Tribunal, however, found that these issues had been previously addressed and that the revenue's application did not point out any mistake apparent on record but rather sought a re-evaluation of the evidence and facts, which is not within the scope of section 254(2).

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 134800 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 1 month(s) 3 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 21-03-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 09-03-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 18-02-2021
• Other Referred Cases: CIT vs Reliance Telecom Ltd.
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 254(2)

Judgement Text

आयकर अपीलीय अिधकरण, ‘ए’ ᭠यायपीठ, चे᳖ई IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH, CHENNAI ᮰ी वी दुगाᭅ राव, ᭠याियक सद᭭य एवं ᮰ी मंजुनाथ. जी, लेखा सद᭭य के समᭃ BEFORE SHRI V. DURGA RAO, HON’BLE JUDICIAL MEMBER AND SHRI MANJUNATHA. G, HON’BLE ACCOUNTANT MEMBER Misc. Application No. 6/Chny/2021 [In ITA No. 397/Chny/2016] (िनधाᭅरणवषᭅ / Assessment Year: 2011-12) The Assistant Commissioner of Income Tax, Non Corporate Circle -4, Coimbatore. v. M/s. Sri Balaji Real Estates, 7, Kuppusamy Street, Pollachi – 642 001. [PAN: ABVFS-1678-J] (ᮧाथᭅक /Petitioner) (ᮧ᭜यथᱮ/Respondent) ᮧाथᭅक कᳱ ओरसे/ Petitioner by : Shri. AR V Sreenivasan, Addl. CIT ᮧ᭜यथᱮ कᳱ ओर से/Respondent by : Shri. D. Anand, Advocate सुनवाई कᳱ तारीख/Date of Hearing : 10.03.2023 घोषणा कᳱ तारीख/Date of Pronouncement : 22.03.2023 आदेश /O R D E R PER MANJUNATHA. G, ACCOUNTANT MEMBER: The revenue has filed present Miscellaneous Application u/s. 254(2) of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) against order of the Tribunal in ITA No. 397/Chny/2016 dated 24.10.2019 and relevant to assessment year 2011-12. :-2-: MA. No: 6/Chny/2021 2. The revenue has narrated facts and mistakes stated to be apparent on record from the order of the Tribunal and relevant contents of Miscellaneous Application filed by the revenue are reproduced as under: Ground No. 1: "On verification of records it is seen that Hon'ble ITAT has incorrectly stated in para10 of impugned order that outcome of civil suit filed by Shri. Varadharaj was not brought on record by AO. Whereas this matter had been discussed in Page No. 48, para No. (xii) of the assessment order and the documents obtained from Court regarding the said civil suit were made part of the assessment order in Annexure B for AY 2011-12 which contains the order of the Hon'ble Principal District Court dated. 27.02.2012, dismissing the petition as not pressed. Therefore, the Hon'ble ITAT ought not to have held that the outcome of the civil suit filed by Shri. Varadharaj was not brought on record by AO and ought to have taken into consideration of the outcome ( dismissing the petition as not pressed) of the civil suit filed by Shri. Varadharaj who stated that a sum of Rs.4,00,00,000/- was received in cash and also that there was no money payable on account of purchase of the property (kindly refer Para No. 10 at Page No. 8 of the Hon'ble Tribunal's order)." Ground No. 2: "Also, regarding the observation of Hon'ble ITAT that there is no material brought on record for payment of Rs. 6,50,00,000/- (kindly refer Para No. 10 at Page No. 8 of the Hon'ble Tribunal's order) It is noted that the books of accounts of the assessee had been rejected by the AO, which is not contested by the assessee, and the only evidence submitted by the assessee is the books of accounts. The AO while rejecting the books of accounts of the assessee has made the addition of Rs. 6,50,00,000/- based on the evidences and materials collected by him at the time of assessment proceedings which are discussed in Para No. 2.6.1 at Page No. 46 of the assessment order. Therefore, the order of the Hon'ble Tribunal is a mistake in stating that there is no material brought on record for payment of Rs. 6,50,00,000/-. :-3-: MA. No: 6/Chny/2021 In view of the above it is requested that the Miscellaneous petition may please be taken into record and Hon'ble Tribunal may pass an order as deemed fit on the facts and circumstances prevailing in the case of the assessee.” 3. We have heard both the sides and considered relevant contents of Miscellaneous Application filed by the revenue in light of order of the Tribunal dated 24.10.2019 and we find that the Tribunal had given a categorical finding in Para 10 of their order dated 24.10.2019, on the issue of consideration received towards transfer of property and while deciding the issue has considered various evidences including civil suit filed in the court of law and held that there cannot be any additional on account of cessation of liability in the hands of the assessee, because the AO could not brought on record any evidence to disprove the claim of the assessee that balance consideration of Rs. 6.5 crores was paid during the financial years relevant to assessment years 2012-13 & 2013-14. The sole grievance of the revenue in light of findings of the Tribunal is that while giving its finding on the issue, the Tribunal went on the wrong premises that the outcome of civil suit was not brought on record by the Assessing Officer, but fact remains that the AO has discussed the issue in light of civil suit filed by M/s. Vanjiamman Finance & Real Estates and :-4-: MA. No: 6/Chny/2021 this fact has been brought out in Para 2.6.1 clause 11 & 12. Since, the Tribunal given its finding on the premises that the outcome of the civil suit was not brought on record by the AO while deciding the issue, even though such fact is incorrect, the basis of said finding constitutes mistake apparent on record which needs to be rectified. He, further submitted that the other observations of the Tribunal that there is no material brought on record for payment of Rs. 6.5 crores in the next two assessment years is also incorrect, because the books of accounts of the assessee had been rejected by the AO, which is not contested by the assessee. Therefore, he submitted that two observations of the Tribunal constitutes mistake apparent on record which needs to be rectified u/s. 254(2) of the Act. 4. The ld. Counsel for the assessee, referring to the order of the Tribunal submitted that the revenue fails to make out a case of Prima Facie mistake from the order of the Tribunal, but what was sought through present Miscellaneous Application is review the decision rendered by the Tribunal in the given facts and circumstances of the case and thus, it cannot be said that :-5-: MA. No: 6/Chny/2021 there is a mistake apparent on record which can be rectified u/s. 254(2) of the Act. 5. We have heard both the parties and considered relevant contents of Miscellaneous Application filed by the revenue. We find that the Tribunal had given its finding in Para 10 of their order dated 24.10.2019, in light of various averments made by both the parties including facts brought on record by the Assessing Officer and held that provisions of section 41(1) of the Act cannot be invoked for the impugned assessment year, because the assessee has filed necessary evidences to prove that balance consideration towards transfer of property has been paid in subsequent assessment years 2012-13 & 2013- 14. The sole grievance of the revenue on the finding of the tribunal is outcome of civil suit filed by the seller of the property and this fact has been already considered by the Tribunal while rendering its decision. Therefore, we are of the considered view that the revenue has failed to make out a case of prima facie mistake apparent on record from the order of the Tribunal dated 24.10.2019, but what was sought through Miscellaneous Application filed by the revenue is review of the judgment rendered by the Tribunal in the given :-6-: MA. No: 6/Chny/2021 facts and circumstances of the case, which is not permissible under the law and as held in the case of CIT vs Reliance Telecom Ltd., in TCA No. 7110 of 2021. In the said case, it was held that in case order passed by the Tribunal was erroneous on merits, in that case the remedy available to the parties was to prepare an appeal before the High Court. But it cannot be said that there is a mistake in the order of the Tribunal which can be rectified u/s. 254(2) of the Act. The second grievance of the revenue in light of findings of the Tribunal that no material was brought forward to prove that balance consideration was paid in subsequent financial years is also appraisal of facts, because mere fact that books of accounts of the assessee has been rejected by the AO does not perse disprove the claim of the assessee that balance consideration has been paid in subsequent assessment years, because the claim of the assessee has been substantiated with necessary evidences including confirmation from the sellers. Therefore, on this ground also the Miscellaneous Application filed by the revenue fails. 6. In this view of the matter and by considering facts and circumstances of the case and also by following the decision of :-7-: MA. No: 6/Chny/2021 Supreme Court in the case of CIT vs Reliance Telecom Ltd. (supra), we are of the considered view that there is no merit in the Miscellaneous Application filed by the revenue and thus, same is dismissed. 7. In the result, Miscellaneous Application filed by the revenue is dismissed. Order pronounced in the court on 22 nd March, 2023 at Chennai. Sd/- (वी दुगाᭅ राव) (V. DURGA RAO) ᭠याियकसद᭭य/Judicial Member Sd/- (मंजुनाथ. जी) (MANJUNATHA. G) लेखासद᭭य/Accountant Member चे᳖ई/Chennai, ᳰदनांक/Dated: 22 nd March, 2023 JPV आदेश कᳱ ᮧितिलिप अᮕेिषत/Copy to: 1. अपीलाथᱮ/Appellant 2. ᮧ᭜यथᱮ/Respondent 3. आयकर आयुᲦ (अपील)/CIT(A) 4. आयकर आयुᲦ/CIT 5. िवभागीय ᮧितिनिध/DR 6. गाडᭅ फाईल/GF