Mantena Ramakrishna Raju, Visakhapatnam V. The Welth Tax Officer, Ward-3(1), Visakhapatnam

WTA 3/VIZ/2016

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 3796 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 2 year(s) 11 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 30-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: R S ARVINDAN
• Keywords: Opportunity of being heard; Additional evidence; Set aside

Judgement Text

WTA NO.2&3/VIZAG/2016 MANTENA RAMAKRISHNA RAJU, VSKP 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . , $ BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ./W.T.A.NO.2/VIZAG/2016 ( / ASSESSMENT YEAR: 2009-10) THE WTO, WARD - 3(1), VISAKHAPATNAM VS. MANTENA RAMKRISHNAM RAJU, VISAKHAPATNAM [P AN: AKQPM9516K ] ( % / APPELLANT) ( &'% / RESPONDENT) ./W.T.A.NO.3/VIZAG/2016 ( / ASSESSMENT YEAR: 2009-10) MANTENA RAMKRISHNAM RAJU, VISAKHAPATNAM VS. THE WTO, WARD - 3(1), VISAKHAPATNAM ( % / APPELLANT) ( &'% / RESPONDENT) / APPELLANT BY : SHRI R.S. ARVINDAN, DR / RESPONDENT BY : SHRI I. KAMA SASTRY, AR / DATE OF HEARING : 24.01.2017 / DATE OF PRONOUNCEMENT : 31.01.2017 WTA NO.2&3/VIZAG/2016 MANTENA RAMAKRISHNA RAJU, VSKP 2 / O R D E R PER G. MANJUNATHA, ACCOUNTANT MEMBER: THESE CROSS APPEALS FILED BY THE ASSESSEE, AS WELL AS THE REVENUE ARE DIRECTED AGAINST ORDER OF THE CIT(A)-1, VISAKHAPATNAM DATED 25.2.2016 AND IT PERTAINS TO THE ASSESSMENT Y EAR 2009-10. SINCE, THE FACTS ARE IDENTICAL AND ISSUES ARE COMMON, THEY ARE CLUBBED, HEARD TOGETHER AND DISPOSED-OFF BY WAY OF THIS COMMON ORD ER FOR THE SAKE OF CONVENIENCE. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E DID NOT FILED HIS RETURN OF WEALTH FOR THE ASSESSMENT YEAR 2009-10. THE A.O., RECORDING REASONS, RE-OPENED THE ASSESSMENT BY ISSUING NOTICE U/S 17(1) OF THE WEALTH TAX ACT, 1957 (HEREINAFTER CALLED AS THE ACT ). IN RESPONSE TO NOTICE, THE ASSESSEE HAS FILED HIS RETURN OF WEALTH DECLARING NET WEALTH OF ` 25,99,622/-. THE ASSESSMENT WAS COMPLETED U/S 16( 3) R.W.S. 17 OF THE ACT, DETERMINING THE NET WEALTH AT ` 72,37,192/-, INTER-ALIA BY MAKING ADDITIONS TOWARDS MADAPUR SITE FOR ` 15 LAKHS AND AYYAPPA SOCIETY SITE FOR ` 31,37,560/-. 3. AGGRIEVED BY THE ASSESSMENT ORDER, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A). BEFORE THE CIT(A), THE ASSESSEE CONTENDED THAT IN RESPECT OF MADAPUR SITE, THOUGH HE HAD SHOW N INVESTMENT IN THE WTA NO.2&3/VIZAG/2016 MANTENA RAMAKRISHNA RAJU, VSKP 3 BALANCE SHEET AS SITE, BUT THIS IS AN ADVANCE PAYME NT FOR PURCHASE OF SITE AND HENCE NOT TAXABLE. IN SO FAR AS AYYAPPA S OCIETY SITE, THE ASSESSEE SUBMITTED THAT AS PER THE PROVISIONS OF SE CTION 5(VI) OF THE ACT, THE ASSESSEE IS ELIGIBLE FOR EXEMPTION FOR ONE RESI DENTIAL HOUSE, THEREFORE, HE HAD CLAIMED EXEMPTION FOR AYYAPPA SOC IETY SITE. THE CIT(A) AFTER CONSIDERING THE EXPLANATIONS FURNISHED BY THE ASSESSEE AND ALSO TAKEN INTO ACCOUNT THE ADDITIONAL EVIDENCES FI LED BY THE ASSESSEE IN THE FORM OF LEDGER EXTRACT AND CONFIRMATION LETTER FROM THE PERSON WHO RECEIVED THE ADVANCE, DIRECTED THE A.O. TO DELETE A DDITIONS MADE TOWARDS MADAPUR SITE BY HOLDING THAT ADVANCE PAYMEN T FOR PURCHASE OF SITE IS NOT TAXABLE. IN SO FAR AS AYYAPPA SOCIETY SITE, THE CIT(A) HELD THAT THOUGH THE ASSESSEE CLAIMS THAT AYYAPPA SOCIET Y SITE IS A RESIDENTIAL HOUSE PROPERTY, FAILED TO FILE ANY EVIDENCES TO SUB STANTIATE THE CLAIM THAT THE SAID PROPERTY IS A RESIDENTIAL HOUSE WHICH IS EXEMPT U/S 5(1)(VI) OF THE ACT, THEREFORE, CONFIRMED ADDITIONS MADE BY THE A.O. AGGRIEVED BY THE CIT(A) ORDER, THE ASSESSEE AS WELL AS REVENU E ARE IN APPEAL BEFORE US. 4. THE LD. A.R. SUBMITTED THAT THE LD. CIT(A) FAILE D TO APPRECIATE THE FACT THAT THE ASSESSEE IS ELIGIBLE FOR EXEMPTION TO WARDS ONE RESIDENTIAL HOUSE PROPERTY UNDER THE PROVISIONS OF SECTION 5(1) (VI) OF THE ACT. THE A.R. FURTHER SUBMITTED THAT THE LD. CIT(A) NEVER AS KED THE ASSESSEE TO WTA NO.2&3/VIZAG/2016 MANTENA RAMAKRISHNA RAJU, VSKP 4 PRODUCE DOCUMENTARY EVIDENCE IN SUPPORT OF THE CLAI M FOR EXEMPTION OF THE SITE, THEREFORE, THE ASSESSEE HAD NO OCCASION T O PRODUCE ANY EVIDENCES BEFORE THE A.O. BUT THE FACTS REMAIN THA T AYYAPPA SOCIETY SITE IS A RESIDENTIAL PROPERTY AND AS PER THE PROVI SIONS OF SECTION 5(1)(VI) OF THE ACT, THE ASSESSEE IS ELIGIBLE FOR EXEMPTION FOR ONE RESIDENTIAL HOUSE. IN SUPPORT OF HIS ARGUMENTS, FILED A PETITI ON FOR ADMISSION OF ADDITIONAL EVIDENCES ALONG WITH SALE DEED COPY OF T HE PROPERTY AND REQUESTED TO SET ASIDE THE ISSUE TO THE FILE OF THE A.O. FOR FURTHER EXAMINATION. 5. ON THE OTHER HAND, THE LD. D.R. SUBMITTED THAT T HE LD. CIT(A) ERRED IN EXCLUDING THE VALUE OF MADAPUR SITE FROM T HE NET WEALTH OF THE ASSESSEE BY ADMITTING ADDITIONAL EVIDENCE IN THE FO RM OF LEDGER EXTRACT AND A CONFIRMATION LETTER WITHOUT AFFORDING AN OPPO RTUNITY TO THE ASSESSING OFFICER BEFORE ADMITTING THE SAID ADDITIO NAL EVIDENCES. THE D.R. FURTHER SUBMITTED THAT THE ASSESSEE HIMSELF HA S SHOWN A PARTICULAR ASSET IN THE FIXED ASSET ON THE ASSET SIDE OF THE B ALANCE SHEET, THEREFORE, THE A.O. HAS RIGHTLY MADE ADDITIONS AS THE ASSESSEE IS ELIGIBLE FOR EXEMPTION FOR ONE RESIDENTIAL HOUSE PROPERTY. THE CIT(A) WITHOUT OFFERING ANY OPPORTUNITY TO THE A.O. DELETED ADDITI ONS MADE BY THE A.O. BY ACCEPTING ADDITIONAL EVIDENCES AND HENCE THE ISS UE MAY BE SET ASIDE TO THE FILE OF THE A.O. FOR FURTHER EXAMINATION. WTA NO.2&3/VIZAG/2016 MANTENA RAMAKRISHNA RAJU, VSKP 5 6. HAVING HEARD BOTH THE SIDES AND CONSIDERED MATER IALS ON RECORD, WE FIND THAT THE A.O. HAS MADE ADDITIONS FOR TWO AS SETS TO THE NET WEALTH OF THE ASSESSEE FOR THE REASON THAT THE ASSE SSEE IS NOT ELIGIBLE FOR EXEMPTION U/S 5(1)(VI) OF THE ACT. THE CIT(A) HAS DIRECTED THE A.O. TO DELETE ADDITIONS MADE TOWARDS MADAPUR SITE BY ADMIT TING ADDITIONAL EVIDENCES FILED BY THE ASSESSEE WITHOUT AFFORDING A N OPPORTUNITY TO THE A.O. SIMILARLY, THE ASSESSEE HAS FILED ADDITIONAL EVIDENCES IN THE FORM OF SALE DEED TO SUBSTANTIATE THE CLAIM OF EXEMPTION FO R ONE RESIDENTIAL HOUSE U/S 5(1)(VI) OF THE ACT, WHICH WAS NOT FILED BEFORE THE A.O. AS WELL AS THE CIT(A). DURING THE COURSE OF HEARING, BOTH THE COUNSELS AGREED TO SET ASIDE THE ISSUE TO THE FILE OF THE A.O. FOR FURTHER VERIFICATION. THEREFORE, WE ARE OF THE VIEW THAT THE ISSUE NEEDS TO BE EXAMINED BY THE A.O. WITH REFERENCE TO THE ADDITIONAL EVIDENCES FILED BY THE ASSESSEE. HENCE, WE SET ASIDE THE ISSUE TO THE FILE OF THE A. O. AND DIRECT THE A.O. TO EXAMINE THE ADDITIONAL EVIDENCES FILED BY THE AS SESSEE TO SUBSTANTIATE HIS CLAIM WITH REGARD TO THE EXEMPTION FOR MADAPUR SITE AS WELL AS AYYAPPA SOCIETY SITE AND PASS APPROPRIATE ORDERS WI TH A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WTA NO.2&3/VIZAG/2016 MANTENA RAMAKRISHNA RAJU, VSKP 6 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE AND THE APPEAL FILED BY THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES . THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 31 ST JAN17. SD/- SD/- ( . ) ( . ) (V. DURGA RAO) (G. MANJUNATHA) /JUDICIAL MEMBER /ACCOUNTANT MEMBER # /VISAKHAPATNAM: ' /DATED : 31.01.2017 VG/SPS )# *# /COPY OF THE ORDER FORWARDED TO:- 1. / THE APPELLANT THE WTO, WARD-3(1), VISAKHAPATNA M 2. / THE RESPONDENT SRI MANTENA RAMAKRISHNAM RAJU, 8-4-18/9, FLAT NO.401, SAISRINIVASAM, PRASANTHINAGAR, PEDAWALTAIR, VISAKHAPATNAM 3. + / THE CIT, VISAKHAPATNAM 4. + ( ) / THE CIT (A)-1, VISAKHAPATNAM 5. # . , . , # / DR, ITAT, VISAKHAPATNAM 6 . / GUARD FILE / BY ORDER // TRUE COPY //