KISHOREBHAI POKAR, MUMBAI v. ASST CIT 22(1), NAVI MUMBAI

CO 162/MUM/2013 | 2007-2008
Pronouncement Date: 09-10-2013 | Result: Partly Allowed

Appeal Details

RSA Number 16219923 RSA 2013
Assessee PAN AGEPP6820F
Bench Mumbai
Appeal Number CO 162/MUM/2013
Duration Of Justice 2 month(s) 20 day(s)
Appellant KISHOREBHAI POKAR, MUMBAI
Respondent ASST CIT 22(1), NAVI MUMBAI
Appeal Type Cross Objection
Pronouncement Date 09-10-2013
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted Not Allotted
Tribunal Order Date 09-10-2013
Assessment Year 2007-2008
Appeal Filed On 19-07-2013
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH I MUMBAI ! '# $## #% & ! ' BEFORE SHRI RAJENDRA SINGH ACCOUNTANT MEMBER AND SHRI VIVEK VARMA JUDICIAL MEMBER . : 1229 / / 2011 A.Y. 2007-08 ITA NO. : 1229/MUM/2011 (ASSESSMENT YEAR: 2007-08) DCIT/ACIT 22(1) 4 TH FLOOR TOWER-6 VASHI RAILWAY STATION BUILDING NAVI MUMBAI -400 703 VS SHRI KISHOREBHAI KANJI POKAR 50/51 OM SHREYAS APARTMENTS NEW MANEKLAL ESTATE S.N.M. MARG GHATKOPAR (W) MUMBAI -400 086 (APPELLANT) (RESPONDENT) C.O. 162/MUM/2013 ARISING OUT OF ITA NO. 1229/MUM/2011 AY 2007-08 SHRI KISHOREBHAI KANJI POKAR MUMBAI -400 086 .: PAN: AGEPP 6820 F VS ACIT 22(1) 4 TH FLOOR TOWER-6 VASHI RAILWAY STATION BUILDING NAVI MUMBAI -400 703 CROSS OBJECTOR (APPELLANT) (RESPONDENT) APPELLANT CROSS OBJECTOR BY : NONE RESPONDENT-REVENUE BY : MISS BHAVANA C. YASHROY /DATE OF HEARING : 30-09-2013 !' / DATE OF PRONOUNCEMENT : 09-10-2013 + O R D E R $## #% : PER VIVEK VARMA JM: THE REVENUE HAS FILED AN APPEAL AGAINST THE ORDER OF CIT( A) 33 MUMBAI DATED 24.11.2010. ON RECEIPT OF THE NOTICE/ACKNOWLE DGEMENT THE ASSESSEE ALSO FILED A CROSS OBJECTION AGAINST THE OR DER IMPUGNED BY THE DEPARTMENT. SHRI KISHOREBHAI KANJI POKAR ITA NO. 1229/MUM/2012 CO 162/M/2013 2 2. AT THE TIME OF HEARING WHEN THE CASE WAS CALLED FOR HE ARING NEITHER ANYBODY ATTENDED NOR THERE WAS ANY PRAYER FOR ADJOURNMENT. IN THESE CIRCUMSTANCES WE ARE PROCEEDING EXPARTE IN ABSENCE OF THE ASSESSEE OR HIS AR. 3. THE DEPARTMENT HAS TAKEN THE FOLLOWING GROUNDS OF APPEAL: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD CIT(A) ERRED IN ACCEPTING THE INCOME FROM HOUSE PROPERTY A T RS.(-)1 50 000/- ON THE BASIS OF DETAILS FURNISHED DURING APPELLATE PRO CEEDINGS. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD CIT(A) ERRED IN ALLOWING DEDUCTION U/S.80C OF THE ACT OF R S.1 00 000/- RELATING TO REPAYMENT OF HOUSING LOAN ON THE BASIS OF DETAIL S FURNISHED DURING APPELLATE PROCEEDINGS. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD CIT(A) ERRED IN DIRECTING THE AD. TO MODIFY THE TURNOVER O F THE ASSESSEE EVEN THOUGH THE ISSUE WAS NOT IN GROUNDS OF APPEAL. 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD CIT(A) ERRED IN DIRECTING THE A.O. TO INCLUDE RS.24 68 210 /- CREDITED TO THE P&L A/C UNDER THE HEAD EXTRA WORK DONE TO THE TURNOVER OF THE ASSESSEE. 5. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD CIT(A) ERRED IN GRANTING RELIEF ON THE BASIS OF EVIDENCE P RODUCED IN CONTRAVENTION TO PROVISIONS OF RULE 46A OF THE I.T. RULES. 6. THE APPELLANT PRAYS THAT THE ORDER OF THE CIT( A) ON THE ABOVE GROUND BE REVERSED AND THAT OF THE ASSESSING OFFICER BE RESTO RED. 7. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER AN Y GROUNDS OR ADD A NEW GROUND WHICH MAY BE NECESSARY. 4. GROUNDS 1 & 2 OF THE GROUNDS OF APPEAL PERTAINS TO TH E INCOME UNDER THE HEAD HOUSE PROPERTY. 5. ON GOING THROUGH THE ORDERS OF THE REVENUE AUTHORIT IES IT IS OBVIOUS THAT THE DETAILS ASKED FOR BY THE AO PERTAINING T O INTEREST ON HOUSING LOAN U/S 24(B) ON THE SELF OCCUPIED PROPERTY AND THE DEDUCTION CLAIMED U/S 80C WERE NOT PROVIDED AT THE ASSE SSMENT STAGE BUT WERE PLACED ON RECORD BEFORE THE CIT(A) WHO CONSIDER ED THE SAME AND DELETED THE ADDITION MADE. FROM THE IMPUGNED ORDER O F THE CIT(A) IT CANNOT BE GATHERED THAT ANY OPPORTUNITY WAS PROVIDE D OR THE ISSUE WAS REMANDED BACK FOR AOS COMMENTS. 6. IN THESE CIRCUMSTANCES IN THE INTEREST OF JUSTICE WE RESTORE THE ISSUES TO THE FILE OF THE CIT(A) WHO SHALL READJUDICATE THEM AFTER SEEKING COMMENTS FROM THE AO AND CONFRONTING THE SAME T O THE SHRI KISHOREBHAI KANJI POKAR ITA NO. 1229/MUM/2012 CO 162/M/2013 3 ASSESSEE. THE CIT(A) SHALL THEN TAKE A VIEW ON THE ISSUES MENTIONED IN GROUNDS NO. 1 & 2. 7. GROUNDS NO. 1 & 2 ARE THUS ALLOWED. 8. GROUNDS NO. 3 & 4 PERTAIN TO THE COMPUTATION OF GROS S PROFIT ON TURNOVER. 9. THE FACTS ARE THAT THE ASSESSEE IS IN CONSTRUCTION B USINESS AND IN ITS PROFIT & LOSS ACCOUNT HE HAD SHOWN THE TOTAL TURNO VER AT RS. 2 67 43 643/-. 10. IN THE ASSESSMENT STAGE THE AO PROCEEDING EXPARTE TOOK THE TURNOVER AT RS. 2 42 75 433/- ON WHICH HE ESTIMATED THE P ROFIT @ 8% WHICH CAME AT RS. 19 42 035/- AND SEPARATELY ADDED RS. 2 4 68 210/- AS THE EXTRA WORK DONE AND ADDED THE SAME IN THE COMPUTATION. 11. BEFORE THE CIT(A) THE ASSESSEE SUBMITTED THAT THE A SSESSEE HAD SHOWN ITS TURNOVER AT RS. 2 67 43 643/- AND NOT RS. 2 42 75 433/-. HE FURTHER SUBMITTED THAT THE AO SHOULD HAVE ESTIMATED THE PROFIT ON RS. 2 67 43 643/- AND NOT ON RS. 2 42 75 433/- AND NOT OVER AN D ABOVE RS. 24 68 210/- TO BE ADDED SEPARATELY BECAUSE RS. 2 67 43 643/- INCLUDED RS. 24 68 210/- WHICH WAS NOTHING BUT ARISING FROM THE REGULAR BUSINESS ACTIVITY OF CONSTRUCTION. 12. THE CIT(A) AFTER EXAMINING THE SUBMISSIONS OF THE ASSES SEE NOTED THAT THE BOOKS HAD BEEN AUDITED AND AFTER RECOR DING THE REASONS FOR NON COMPLIANCE BEFORE THE AO HELD THAT THE TURNOVER HAD BEEN SHOWN AT RS. 2 67 43 643/-. HE THEREFORE COMPUTED THE PR OFIT AT 8% ON THIS TURNOVER WHICH CAME AT RS. 21 39 490/-. HE FURTH ER HELD THAT NO SEPARATE ADDITION NEEDS TO BE CALLED UPON AS DONE BY THE AO. HE THEREFORE DELETED THE SEPARATE ADDITION OF RS. 24 68 210/- AND GAVE AN AGGREGATE RELIEF OF RS. 22 70 755/- (RS. 19 42 035/- + RS. 24 68 210/- - RS. 21 39 490/-). SHRI KISHOREBHAI KANJI POKAR ITA NO. 1229/MUM/2012 CO 162/M/2013 4 13. AGAINST THIS FINDING OF FACT BY THE CIT(A) THE DEPARTME NT IS IN APPEAL. 14. THE DR HAS VEHEMENTLY SUPPORTED THE ORDER OF THE AO. 15. PROCEEDING EXPARTE WE HAVE PERUSED THE ORDERS OF THE REVENUE AUTHORITIES AND WE FIND THAT CERTAIN BASIC AND PRIMARY DET AILS WERE THERE BEFORE THE AO WHICH INCITED HIM TO ASK FOR FURTHER DETAILS. IT IS FROM THESE DETAILS THAT THE AO WAS ABLE TO EXTRACT THE FIGURES OF RS. 2 42 75 433/- AND RS. 24 68 210/-. FROM THE CONJOINT READIN G OF THE ORDERS OF BOTH THE REVENUE AUTHORITIES WE FIND THAT THE BOOKS WERE MAINTAINED AND AUDITED. IT IS FROM THESE AUDITED ACCOUNTS THE ASSESSEE WAS ABLE TO EXPLAIN TO THE CIT(A) THAT THE TUR NOVER HAS TO BE TAKEN AT RS. 2 67 43 643/- AND NOT RS. 2 42 75 433/- ON WHIC H PROFIT IS TO BE ESTIMATED AND RS. 21 39 490/- AND NOTHING HAS TO BE CONSIDERED SEPARATELY. SINCE THE INCOME HAS TO BE ESTIM ATED ON TURNOVER WE ARE OF THE OPINION THAT THE CIT(A) HAS CORR ECTLY ADOPTED THE FIGURE OF RS. 2 67 43 643/- AND ESTIMATED THE INCOME @ 8 % ON THIS FIGURE BECAUSE RS. 24 68 210/- WAS NOTHING BUT PART & PAR CEL OF THE TURNOVER OF THE BUSINESS ACTIVITY. 16. WE THEREFORE FIND NO REASON TO DISTURB THE FINDING OF T HE CIT(A) WHICH WE SUSTAIN. 17. GROUNDS NO. 3 & 4 ARE THUS REJECTED. 18. GROUND NO. 5 PERTAINS TO THE CONTRAVENTION OF RULE 46A OF THE IT RULES. 19. WE HAVE GIVEN DIRECTIONS TO THE CIT(A) IN GROUNDS N O. 1 & 2 TO READJUDICATE THE ISSUES INVOLVED AFTER SEEKING COMMENTS FR OM THE AO. IN SO FAR AS GROUNDS NO. 4 & 5 ARE CONCERNED WE HAVE ADJUDICATED ON THE BASIS OF ORDERS WHEREIN THE AO HAS HIMSELF RELIED ON TH E TURNOVER EMANATING FROM THE BOOK RESULTS WHICH HE HAD REJECTED. S INCE THE SHRI KISHOREBHAI KANJI POKAR ITA NO. 1229/MUM/2012 CO 162/M/2013 5 ISSUE DID NOT INVOLVE ANY READJUDICATION WE HAVE DECIDED THE ISSUE ON MERITS. 20. IN THE LIGHT OF OUR OBSERVATIONS HEREABOVE THE GROU ND IS PARTLY ALLOWED. 21. GROUND 6 & 7 ARE GENERAL. 22. IN THE RESULT THE APPEAL FILED BY THE DEPARTMENT IS P ARTLY ALLOWED. CROSS OBJECTION NO. 162/MUM/2013 : FILED BY THE ASSESSEE 23. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS IN THE CO FILED: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LEARNED ASSISTANT COMMISSIONER OF INCOME TAX 22(1) MUMBAI. (ACIT II) 1. ERRED IN OBJECTING THE ORDER OF THE HONBLE CO MMISSIONER OF INCOME-TAX (APPEALS) -33 MUMBAI CIT (A)] ON THE GROUNDS A. IN DISALLOWING DEDUCTION U/S. 80C OF THE ACT OF RS. 1 00 000/- TREATING IT AS RELATING TO REPAYMENT OF HOUSING LOA N PRINCIPAL BUT WE HAVE CLAIMED RS. 45 077/- AS HOUSING LOAN REPAYM ENT AND BALANCE AS PAYMENT OF LIC PREMIUM. ASSESSING OFFICE R HAS DISALLOWED DEDUCTION OF RS 1 00 000/- IN ABSENCE OF SUPPORTING EVIDENCE BUT WE HAVE FURNISHED DETAILS AS WELL AS P ROOF TO THE COMMISSIONER OF INCOME TAX(APPEALS)33 MUMBAI. B. IN TREATING EXTRA WORK SHOWN IN PROFIT AND LOSS RS. 24 68 210/- AS SEPARATE INCOME WHEREAS THE SAME IS RECEIPT ARIS ING FROM THE CONSTRUCTION ACTIVITY DONE IN REGULAR BUSINESS AND HAS BEEN CHARGED FOR EXTRA WORK DONE ON BEHALF OF BUYER OF F LATS AT PANCHAVATI CO-OP HOUSING SOCIETY LIMITED. IN THE PR OFIT AND LOSS ACCOUNT THE AMOUNT RECEIVED UNDER THE HEAD EXTRA WO RK SHOWN IS RELATED TO CONSTRUCTION ACTIVITY ONLY. IN SUPPOR T OF THE SAME WE HAVE ALREADY SUBMITTED CERTIFIED COPY OF AUDITED RE PORT ALONG WITH PROFIT AND LOSS ACCOUNT. C. IN SUPPORT OF CLAIM FOR HOUSE PROPERTY WE ARE H EREBY ENCLOSING HOUSING LOAN STATEMENT SHOWING DETAILS OF INTEREST AND PRINCIPAL. 24. GROUNDS 1(A) AND 1(C) PERTAIN TO DISALLOWANCE OF DEDUCT ION U/S 80C. THE ISSUE HAS BEEN DEALT WITH BY US IN ITA NO. 1229 /MUM/2011 WHEREIN WE HAVE RESTORED THE ISSUE TO THE FILE OF THE CIT (A) FOR RE- ADJUDICATION AFTER SEEKING COMMENTS FROM THE AO AND THEN PASS AN ORDER IN ACCORDANCE WITH LAW GIVING REASONABLE AND ADEQUA TE OPPORTUNITY TO THE ASSESSEE TO PRESENT HIS CASE. SHRI KISHOREBHAI KANJI POKAR ITA NO. 1229/MUM/2012 CO 162/M/2013 6 25. SINCE WE HAVE ALREADY GIVEN THE FINDING IN THE APPEAL FILE D BY THE DEPARTMENT ON THE ISSUE GROUNDS AS RAISED BECOME INFRUC TUOUS HERE. GROUNDS NO. 1(A) & (C) ARE THEREFORE REJECTED. 26. GROUND NO. 1(B) PERTAINS TO ADDITION OF RS. 24 68 210/-. 27. THE ISSUE HAS BEEN DECIDED BY US IN ITA NO. 1229/MU M/2011 WHEREIN WE HAVE REJECTED GROUND RAISED BY THE DEPARTM ENT TO HOLD THE SAME IN FAVOUR OF THE ASSESSEE THAT THIS EXTRA WORK IS IN CLUDED IN THE TOTAL TURNOVER OF RS. 2 67 43 643/- AND THAT THE CIT(A) WAS CORRECT IN COMPUTING THE INCOME @ 8% ON THE FIGURE OF AGGREGATE OF R S. 2 67 43 643/- WHICH INCLUDED THE IMPUGNED FIGURED. 28. SINCE WE HAVE ALREADY DECIDED THE ISSUE AGAINST THE DEPARTMENT IN THE APPEAL FILED BY THE DEPARTMENT THE ISSUE RAISED IN THE CO BECOMES AUTOMATICALLY IN FAVOUR OF THE ASSESSEE. 29. IN THESE CIRCUMSTANCES THE GROUND RAISED IS ALLOWED. 30. IN THE RESULT THE CO FILED BY THE ASSESSEE IS PARTLY ALLOWED. SUM UP RESULTS: REVENUES APPEAL IN ITA 1229 OF 2011 STANDS PARTLY ALLOWED ASSESSEES CO 162 OF 2013 STANDS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 9 TH OCTOBER 2013. SD/- SD/- ( ) ( $## #% ) ! ! (RAJENDRA SINGH) (VIVEK VARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI DATE: 9 TH OCTOBER 2013 / COPY TO:- SHRI KISHOREBHAI KANJI POKAR ITA NO. 1229/MUM/2012 CO 162/M/2013 7 1) / THE APPELLANT. 2) / THE RESPONDENT. 3) & &' ( ) - 33 MUMBAI / THE CIT (A)-33 MUMBAI. 4) & &' 22 MUMBAI / THE CIT 22 MUMBAI 5) )*+ & & -. / THE D.R. I BENCH MUMBAI. 6) +/ 0 COPY TO GUARD FILE. &12 / BY ORDER / / TRUE COPY / / [ 3 / 4 5 & -. DY. / ASSTT. REGISTRAR I.T.A.T. MUMBAI *784 . . * CHAVAN SR. PS