S.Harsha, CHENNAI v. ITO, Pondicherry

ITA 1043/CHNY/2014 | 2009-2010
Pronouncement Date: 31-07-2015 | Result: Allowed

Appeal Details

RSA Number 104321714 RSA 2014
Assessee PAN ACKPH5130J
Bench Chennai
Appeal Number ITA 1043/CHNY/2014
Duration Of Justice 1 year(s) 3 month(s) 5 day(s)
Appellant S.Harsha, CHENNAI
Respondent ITO, Pondicherry
Appeal Type Income Tax Appeal
Pronouncement Date 31-07-2015
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted C
Date Of Final Hearing 04-06-2015
Next Hearing Date 04-06-2015
Assessment Year 2009-2010
Appeal Filed On 25-04-2014
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL C B ENCH CHENNAI . ! # $ & BEFORE SHRI CHANDRA POOJARI ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD JUDICIAL MEMBER ./ I.T.A.NO . 1043/MDS/2014 ( / ASSESSMENT YEAR: 2009-10) MR.S.HARSHA 7 FIRST CROSS VIVEKANANDA NAGAR PONDICHERRY-605 005. VS INCOME TAX OFFICER WARD-I(2) PUDUCHERRY. PAN:ACKPH5130J ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : MR.S. SRIDHAR ADVOCATE /RESPONDENT BY : MR. KRISHNAMURTHY CIT /DATE OF HEARING : 4 TH JUNE 2015 /DATE OF PRONOUNCEMENT : 31 ST JULY 2015 / O R D E R PER CHALLA NAGENDRA PRASAD JM: THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER OF THE COMMISSIONER OF INCOME TAX PUDUCHERRY DATED 26.03.2014 FOR THE ASSESSMENT YEAR 2009-10 PASSED U NDER SECTION 263 OF THE ACT. THE ASSESSEE IN HIS APPEAL CONTENDED THAT COMMISSIONER OF INCOME TAX ERRED IN ASSUMING JURISDICTION UNDER SECTION 263 OF THE ACT AND CONSEQUENTLY ERRED IN PASSING REVISION ORDER FOR SE TTING ASIDE THE ORIGINAL ASSESSMENT FRAMED BY THE ASSESSING OFF ICER DATED 14.12.2011 UNDER SECTION 143(3) OF THE ACT ON SCRUTINY. 2 ITA NO.1043 /MDS/2014 2. COUNSEL FOR THE ASSESSEE SUBMITS THAT IN THE COU RSE OF ASSESSMENT PROCEEDINGS UNDER SECTION 143(3) OF THE ACT THE ASSESSEE EXPLAINED THE CASH DEPOSITS MADE BY HIM I NTO BANK ACCOUNT IN RESPECT OF ` 25 00 000/- . THE ASSESSEE EXPLAINED THAT HE HAS RECEIVED ` 25 00 000/- AS LOAN FROM HIS FATHER AND THIS WAS DEPOSITED INTO HIS BANK ACCOUNT . CONFIRMATIONS WERE ALSO FILED ALONG WITH AFFIDAVIT OF HIS FATHER BEFORE THE ASSESSING OFFICER IN THE COURSE OF ASSES SMENT PROCEEDINGS. COUNSEL SUBMITS THAT ASSESSING OFFICER AFTER EXAMINING THE DETAILS FURNISHED BY THE ASSESSEE ACC EPTED THAT ASSESSEE HAS TAKEN CASH LOAN FROM HIS FATHER A ND CONCLUDED THE ASSESSMENT. HE FURTHER SUBMITS THAT I N FACT ASSESSING OFFICER MENTIONED THAT ASSESSEE MADE CAS H DEPOSITS AND WITHDRAWALS ON SEVERAL DATES AND WHEN ASKED FOR EXPLANATION ASSESSEE SUBMITTED THAT HE HAS TAK EN LOAN FROM HIS FATHER AND IT IS ALSO MENTIONED THAT AFFID AVIT WAS FILED BEFORE THE ASSESSING OFFICER IN THE COURSE OF ASSES SMENT PROCEEDINGS. HE SUBMITS THAT ALL THE INFORMATION WE RE FILED BEFORE THE ASSESSING OFFICER DURING THE COURSE OF A SSESSMENT PROCEEDINGS AND THEREFORE THE ASSESSMENT ORDER IS NEITHER ERRONEOUS NOR PREJUDICIAL TO THE INTERESTS OF THE R EVENUE. 3 ITA NO.1043 /MDS/2014 PLACING RELIANCE ON THE DECISION OF JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. PVP VENTURES LTD. (101 DTR 161) COUNSEL SUBMITS THAT ONCE THE INCOME TAX OFFICER AD OPTED ONE OF THE COURSES PERMISSIBLE IN LAW AND IT HAS RE SULTED IN LOSS OF REVENUE OR WHERE TWO VIEWS ARE POSSIBLE AND ITO HAS TAKEN ONE OF THE VIEWS WITH WHICH COMMISSIONER DOES NOT AGREE THE ASSESSMENT ORDER CANNOT BE TREATED AS AN ERRONEOUS ORDER PREJUDICIAL TO THE INTERESTS OF THE REVENUE UNLESS THE VIEW TAKEN BY THE INCOME-TAX OFFICER IS UNSUSTAINABLE IN LAW. COUNSEL FOR THE ASSESSEE FUR THER SUBMITS THAT IN FACT THE ASSESSING OFFICER LEVIED P ENALTY UNDER SECTION 271D OF THE ACT FOR ACCEPTING CASH LOAN FRO M FATHER AND THIS PENALTY WAS ALSO DELETED BY THE TRIBUNAL I N ITA NO.2258/MDS/2013 DATED 01.05.2015 FOR THE ASSESSM ENT YEAR 2009-10 A COPY OF THE ORDER IS ALSO PLACED ON RECORD. THUS HE SUBMITS THAT COMMISSIONER OF INCOME TAX IS NOT JUSTIFIED IN DIRECTING THE ASSESSING OFFICER TO DO ASSESSMENT DE NOVO EXAMINING ALL THE ISSUES IN RESPECT OF THE LOAN OBTAINED BY THE ASSESSEE FROM HIS FATHER AND SOURCE S THEREOF. 4 ITA NO.1043 /MDS/2014 3. DEPARTMENTAL REPRESENTATIVE SUPPORTS THE ORDER O F THE COMMISSIONER OF INCOME TAX IN INVOKING THE PROVISIO NS OF SECTION 263 SETTING ASIDE THE ASSESSMENT ORDER PAS SED UNDER SECTION 143(3) OF THE ACT AND DIRECTING THE ASSESSING OFFICER TO REDO THE ASSESSMENT AFRESH IN RESPECT OF LOAN OBTAINED BY THE ASSESSEE FROM HIS FATHER AND SOURCE S THEREOF. 4. HEARD BOTH SIDES. PERUSED ORDERS OF LOWER AUTHOR ITIES AND THE DECISION RELIED ON. IN THIS CASE ASSESSMENT UNDER SECTION 143(3) OF THE ACT WAS COMPLETED ON 14.12.20 11 ACCEPTING THE INCOME RETURNED BY THE ASSESSEE. WHIL E COMPLETING THE ASSESSMENT ASSESSING OFFICER IN THE ASSESSMENT ORDER OBSERVED AS UNDER:- DURING THE COURSE OF ASSESSMENT PROCEEDINGS IT I S SEEN THAT THE ASSESSEE HAS MADE CASH DEPOSITS AND WITHDRAWALS ON SEVERAL DATES. THE ASSESSEE'S REPRESENTATIVE WAS ASKED TO EXPLAIN SUCH CASH DEPOSITS. THE AUTHORISED REPRESENTATIVE HAS STATED THAT A SUM OF RS.20 OO OOOI- WAS TAKEN AS LOAN FROM THE ASSESSEE'S FATHER SHR LN. SUBRAMANIAN DURING THE RELEVANT FINANCIAL YEAR. HE ALSO PRODUCED AN AFFIDA VIT FROM HIM. HENCE THE ASSESSMENT IS COMPLETED U/S.143(3) OF THE INCOME TAX ACT. 5. AS COULD BE SEEN FROM THE ABOVE IN THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTIC ED THAT 5 ITA NO.1043 /MDS/2014 ASSESSEE HAS MADE CASH DEPOSITS AND WITHDRAWALS IN HIS ACCOUNT AND CALLED FOR EXPLANATION FROM THE ASSESSE E AND ASSESSEE HAS FURNISHED EXPLANATION STATING THAT ASS ESSEE HAS RECEIVED LOAN FROM HIS FATHER DURING THE RELEVA NT FINANCIAL YEAR AND AN AFFIDAVIT WAS ALSO FURNISHED BEFORE HIM . THE ASSESSING OFFICER ON EXAMINING THE DETAILS EXPLANA TION AND AFFIDAVIT FURNISHED BY THE ASSESSEE ACCEPTED THAT A SSESSEE HAS RECEIVED LOAN FROM HIS FATHER. AS THE THINGS S TOOD THUS THE COMMISSIONER OF INCOME TAX PASSED ORDER UNDER S ECTION 263 OF THE ACT ON 26.03.2014 SETTING ASIDE THE ASSE SSMENT ORDER DATED 14.12.2011 PASSED UNDER SECTION 143(3) OF THE ACT DIRECTING THE ASSESSING OFFICER TO DO THE ASSES SMENT DE NOVO FOR EXAMINING THE LOAN RECEIVED BY THE ASSESSE E FROM HIS FATHER AND THE SOURCES THEREOF STATING THAT IDE NTITY OF THE DEPOSITOR CREDIT WORTHINESS OF THE DEPOSITOR AND GENUINENESS OF THE TRANSACTION ARE NOT SATISFACTORI LY EXPLAINED. ON GOING THROUGH THE ORDER OF ASSESSMENT PASSED UNDER SECTION 143(3) AND THE ORDER UNDER SECTION 26 3 WE ARE OF THE VIEW THAT ASSESSING OFFICER IN THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS EXAMINED THE ISSUE REGARDING ACCEPTANCE OF LOAN BY THE ASSESSEE FROM HIS FATHER WITH 6 ITA NO.1043 /MDS/2014 REFERENCE TO THE EVIDENCES FURNISHED BEFORE HIM AND THEREFORE THE ORDER PASSED BY THE ASSESSING OFFICE R CANNOT BE SAID TO BE ERRONEOUS OR PREJUDICIAL TO THE INTER ESTS OF THE REVENUE AS HELD BY THE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. PVP VENTURES LTD. (SUPRA) THAT ONCE THE INCOME TAX OFFICER ADOPTED ONE OF THE COURSES PERMISSIBLE IN LAW AND IT HAS RESULTED IN LOSS OF REVENUE OR WHERE TWO VIE WS ARE POSSIBLE AND INCOME-TAX OFFICER HAS TAKEN ONE OF TH E VIEWS WITH WHICH COMMISSIONER DOES NOT AGREE THE ASSESSM ENT ORDER CANNOT BE TREATED AS AN ERRONEOUS ORDER PREJU DICIAL TO THE INTERESTS OF THE REVENUE UNLESS THE VIEW TAKEN BY THE INCOME-TAX OFFICER IS UNSUSTAINABLE IN LAW. IN THE CASE ON HAND THE ASSESSING OFFICER CALLED FOR EXPLANATION EXAMINED THE DETAILS / EVIDENCES FURNISHED BY THE ASSESSEE A ND HAS TAKEN ONE OF THE VIEWS PERMISSIBLE AND ACCEPTED THA T ASSESSEE HAS RECEIVED LOAN FROM HIS FATHER. THUS T HE DIRECTION OF THE COMMISSIONER OF INCOME TAX TO THE ASSESSING OFFICER TO REDO THE ASSESSMENT DE NOVO FO R EXAMINING THE LOAN TRANSACTION ONCE AGAIN IS NOT CO RRECT. FURTHER WE ALSO FIND THAT THIS TRIBUNAL DELETED T HE PENALTY LEVIED BY THE ASSESSING OFFICER UNDER SECTION 271D OF THE ACT 7 ITA NO.1043 /MDS/2014 FOR ACCEPTING CASH LOAN FROM HIS FATHER FOR THE ASS ESSMENT YEAR 2009-10. IN THE CIRCUMSTANCES WE SET ASIDE TH E ORDER OF THE COMMISSIONER OF INCOME TAX PASSED UNDER SECTION 263 OF THE ACT AND ALLOW THE GROUNDS RAISED BY THE ASSE SSEE. 6. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST JULY 2015. SD/- SD/- ( # ) ( & (# ) ( CHANDRA POOJARI ) ( CHALLA NAGENDRA PRASAD ) * / ACCOUNTANT MEMBER ( * / JUDICIAL MEMBER ( /CHENNAI /DATED 31 ST JULY 2015 SOMU ./ 0/ /COPY TO: 1. APPELLANT 2. RESPONDENT 3. 1 () /CIT(A) 4. 1 /CIT 5. / 5 /DR 6. /GF .