Shri Hiteshkumar Ramanlal Desai, Dist.Valsad v. The Income tax Officer, Ward-1,, Vapi

ITA 1655/AHD/2007 | 2004-2005
Pronouncement Date: 27-08-2010 | Result: Partly Allowed

Appeal Details

RSA Number 165520514 RSA 2007
Assessee PAN ABHPD0187D
Bench Ahmedabad
Appeal Number ITA 1655/AHD/2007
Duration Of Justice 3 year(s) 4 month(s) 4 day(s)
Appellant Shri Hiteshkumar Ramanlal Desai, Dist.Valsad
Respondent The Income tax Officer, Ward-1,, Vapi
Appeal Type Income Tax Appeal
Pronouncement Date 27-08-2010
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted A
Tribunal Order Date 27-08-2010
Date Of Final Hearing 19-08-2010
Next Hearing Date 19-08-2010
Assessment Year 2004-2005
Appeal Filed On 23-04-2007
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH AHMEDABAD BENCH AHMEDABAD BENCH AHMEDABAD BENCH A AA A BEFORE BEFORE BEFORE BEFORE SHRI SHRI SHRI SHRI N NN N. .. .S. SAINI S. SAINI S. SAINI S. SAINI ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER AND AND AND AND SHRI SHRI SHRI SHRI MAHAVIR SINGH JUDICIAL MEMBER MAHAVIR SINGH JUDICIAL MEMBER MAHAVIR SINGH JUDICIAL MEMBER MAHAVIR SINGH JUDICIAL MEMBER DATE OF HEARING :23 8 10 DRAFTED ON: 23-8-10 ITA NO. 1655 /AHD/ 20 0 7 ASSESSMENT YEAR :2004-05 SHRI HITESHKUMAR RAMANLAL DESAI. AT PALSANA POST. UDWADA DISTRICT VAPI. VS. INCOME TAX OFFICER WARD 1 INCOME TAX OFFICE CHALA VAPI. PAN/GIR NO. : ABHPD0187D (A PPELLANT ) .. ( RESPONDENT ) APPELLANT BY : SHRI TUSHARF HEMANI. RESPONDENT BY: SHRI R.K. DHANESTA D.R. O R D E R O R D E R O R D E R O R D E R PER N.S.SAINI ACCOUNTANT MEMBER :- THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)- V ALSAD DATED 15-1-2007. 2. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APP EAL:- 1. LEARNED ASSESSING OFFICER HAS ERRED IN LAW AND ON FACTS TO ADD AN AMOUNT NET INCOME OF `.4 48 970/- FROM AGRICULTURAL ACTIVITY AND SALE OF MILK OF HIS OWN C ATTLE AS INCOME FROM UNDISCLOSED SOURCES. LEARNED COMMISSIO NER OF INCOME TAX (APPEALS) HAS ALSO ERRED IN CONFIRMING L EARNED ASSESSING OFFICERS ACTION. 2. LEARNED ASSESSING OFFICER TREATED TOTAL SALES O F MILK OF `.1 52.400/- AS NET INCOME WITHOUT ALLOWING PRORATE/PROPORTIONATE EXPENSES. LEARNED COMMISSIONE R OF INCOME TAX (APPEALS) HAS ALSO ERRED IN CONFIRMING L EARNED ASSESSING OFFICERS ACTION. 3. LEARNED ASSESSING OFFICER WHEN ACCEPTS THE FIGU RE OF TOTAL AGRICULTURAL AND MILK SALE FOR THE PURPOSE OF COMPUTING TAXABLE INCOME HOW CAN HE TREAT SOURCE OF THE SAME AS - 2 - UNDISCLOSED SOURCE. LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ALSO ERRED IN CONFIRMING LEARNED ASSE SSING OFFICERS ACTION. 3. THE LEARNED AUTHORISED REPRESENTATIVE OF THE ASS ESSEE MADE NO SERIOUS SUBMISSIONS IN RESPECT OF THE ABOVE THREE GROUNDS OF APPEAL. THEREFORE THEY ARE DISMISSED FOR LACK O F PROSECUTION. 4. GROUND NO.4 READS AS UNDER :- AS PER I.T. ACT A PERSON WHO HAS EARNED INCOME IS TO BE TAXED FOR SUCH INCOME WHEN ACQUISITION OF AGRICULTU RAL LAND IS SHOWN BY WAY OF PARTITION OF ANCESTRAL AGRICULTURAL LAND. LEARNED ASSESSING OFFICER HAS ERRED IN TREATING AGR ICULTURAL INCOME IN THE HANDS OF APPELLANT INDIVIDUAL AND N OT OF HUF. LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ER RED IN DISMISSING THIS ADDITIONAL VITAL GROUND. 5. THE LEARNED AUTHORISED REPRESENTATIVE OF THE ASS ESSEE SUBMITTED THAT THIS GROUND OF APPEAL IS SQUARELY CO VERED BY THE DECISION OF THIS TRIBUNAL IN THE CASE OF HIS OWN BR OTHER SHRI NARENDRABHAI R. DESAI IN ITA NO.2553/AHD/2007 FOR A SSESSMENT YEAR 2004-05 ORDER DATED 27-2-2009 WHEREIN THE TR IBUNAL HELD AS UNDER :- 5. WE FIND THAT THE REVENUE AUTHORITY HAVE ACCEPTED THAT THERE WAS A PARTITION OF BIGGER HUF OF THE ASSESSEE ON 23-04- 1998 NO DOUBT THE ASSESSEE HAS NOT FILED ANY RETU RN OF INCOME OF HUF THAT DOES NOT MEAN THE STATUS OF HUF IS GONE. FOR THE STATUS OF HUF TO BE REMAINED INTACT THE NUCLEUS IS REQUIR ED. HERE THE LAND AND CATTLE ARE THE NUCLEUS OF THE HUF. WHETHE R THE ASSESSEE HAS FILED THE RETURN OF INCOME FOR THAT THE ASSESSI NG OFFICER CAN TAKE PROPER ACTION UNDER THE PROVISION OF THE ACT. ACCORDINGLY WE ARE OF VIEW THAT THE HUF EXISTS AND THE CORRECT MET HOD IS TO ASSESS INCOME INTO CORRECT HANDS. THE HON'BLE CALCUTTA HI GH COURT IN THE CASE OF MAYNAK PODDAR (HUF) V. WEALTH-TAX OFFICER (2003) 262 ITR 633 HAS DEALT WITH THAT THE QUESTION OF ASSESSM ENT OF INCOME RELYING ON THE CALCUTTA HIGH COURTS DECISION IN TH E CASE OF CIT V. - 3 - BHASKAR MITTER (1994) 73 TAXMAN 437 (CAL) AND IN THE CASE OF MAYNAK PODDAR (HUF) (SUPRA) AND HELD AS UNDER:- THUS UNLESS THE DEFINITION OF NET WEALTH READ W ITH THE DEFINITION OF ASSET AS PROVIDED IN SECTION 2(M) AND SECTION 2(EA) RESPECTIVELY INCLUDES A BUILDING LET OUT TO A TENA NT USED FOR COMMERCIAL PURPOSES THE SAME CANNOT BE SUBJECTED T O WEALTH-TAX. EVEN IF THE ASSESSEE HAD INCLUDED THE SAME IN HIS R ETURN THAT WOULD NOT PRECLUDE THE ASSESSEE FROM CLAIMING THE B ENEFIT OF LAW. THERE CANNOT BE ANY ESTOPPEL AGAINST THE STATUE. A PROPERTY WHICH IS NOT OTHERWISE TAXABLE CANNOT BECOME TAXABLE BEC AUSE OF MISUNDERSTANDING OR WRONG UNDERSTANDING OF LAW BY T HE ASSESSEE OR BECAUSE OF HIS ADMISSION OR ON HIS MISAPPREHENSI ON. IF IN LAW AN ITEM IS NOT TABLE NO AMOUNT OF ADMISSION OR MIS APPREHENSION CAN MAKE IT TAXABLE. THE TAXABILITY OR THE AUTHORIT Y TO IMPOSE TAX IS INDEPENDENT OF ADMISSION. NEITHER THERE CAN BE ANY WAIVER OF THE RIGHT BY THE ASSESSEE. THE DEPARTMENT CANNOT RELY U PON ANY SUCH ADMISSION OR MISAPPREHENSION IF IT IS NOT OTHERWISE TAXABLE. THIS QUESTION WAS DEALT WITH BY THIS COURT IN BHASKAR MITTERS CASE (1974) 73 TAXMAN 437 AT PARAGRAPH 8 AT PAGE 442. IN THIS DECISION THIS COURT OBSERVED:- AN ASSESSEE IS LIABLE TO PAY TAX ONLY UPON SUCH IN COME AS CAN BE IN LAW INCLUDED IN HIS TOTAL INCOME AND WHIC H CAN BE LAWFULLY ASSESSED UNDER THE ACT. THE LAW EMPOWERS T HE INCOME-TAX OFFICER TO ASSESS THE INCOME OF AN ASSES SEE ACCORDING TO LAW AND DETERMINE THE TAX PAYABLE THER EON IN DOING SO HE CANNOT ASSESS AN ASSESSEE ON AN AMOUNT WHICH IS NOT TAXABLE IN LAW EVEN IF THE SAME IS SH OWN BY AN ASSESSEE. THERE IS NO ESTOPPEL BY CONDUCT AGAINST L AW NOR IS THERE ANY WAIVER OF THE LEGAL RIGHT AS MUCH AS T HE LEGAL LIABILITY TO BE ASSESSED OTHERWISE THAN ACCORDING T O THE MANDATE OF THE LAW (SIC). IT IS ALWAYS UPON TO AN A SSESSEE TO TAKE THE PLEA THAT THE FIGURE THOUGH SHOWN IN HIS RETURN OF TOTAL INCOME IS NOT TAXABLE IN LAW. ACCORDINGLY WE FIND THAT THE ASSESSMENT OF INCOME OF AGRICULTURE & MILK INCOME SHOULD BE ASSESSED IN THE STATUS OF H UF WHO IS A REAL OWNER. ACCORDINGLY WE DIRECT THE ASSESSING OF FICER TO ASSESS THE SAME IN THE HANDS OF HUF. ACCORDINGLY GROUND NO.1 IS DECIDED IN FAVOUR OF THE ASSESSEE AND AGAINST THE R EVENUE AS REGARDS TO STATUS OF THE HUF. AS REGARDS TO GROUND NO.2 AND 4 THE ADDITION ON ACCOUNT OF PURCHASE OF FERTILIZERS AND ADDITION OF SALE MILK INCOME BEING CONSEQUENTIAL. THE ASSESSING OFFI CER WILL RE- DECIDE IN THE HANDS OF HUF AS PER THE PROVISION OF THE ACT. - 4 - 6. IN VIEW OF THE ABOVE WE RESTORE THIS ISSUE BACK TO THE FILE OF THE LEARNED ASSESSING OFFICER FOR PROPER VERIFICATI ON OF THE FACTS OF THE CASE. IF THE FACTS OF THE CASE ARE EXACTLY THE SAME AS FACTS IN THE CASE OF SHRI NARENDRABHAQI R. DESAI THEN THE IS SUE IS TO BE DECIDED AS PER THE DECISION OF THE TRIBUNAL IN THE CASE OF SHRI NARENDRABHAI R. DESAI. THUS THIS GROUND OF APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 7. IN THE RESULT THE APPEAL OF THE OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER SIGNED DATED AND PRONOUNCED IN THE COURT ON 27 TH AUGUST 2010 SD/- SD/- ( MAHAVIR SINGH) ( N.S. SAINI ) JUDICIAL MEMBER ACCOUNTAN T MEMBER AHMEDABAD: ON THIS 27 TH DAY OF AUGUST 2010 COMPILED AND COMPARED BY: PATKI. COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE LD. CIT(APPEALS) VALSAD. 5. THE DR AHMEDABAD BENCH 6. THE GUARD FILE. BY ORDER //TRUE COPY// (DY./ASSTT.REGISTRAR) ITAT AHMEDABAD - 5 - DATE INITIALS 1. DRAFT DICTATED ON 23-8-2010 -------------- ----- 2. DRAFT PLACED BEFORE AUTHORITY 23-8-2010 ---- --------------- 3. DRAFT PROPOSED & PLACED 23-8-2010 -------- ----------- JM BEFORE THE SECOND MEMBER 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 26-8-2010 ------------------- JM 5. APPROVED DRAFT COMES TO P.S 27-8-2010 --------- ----------- 6. KEPT FOR PRONOUNCEMENT ON 27-8-2010 ------- ------------- 7. FILE SENT TO THE BENCH CLERK 27-8-2010 ------- ------------- 8. DATE ON WHICH FILE GOES TO THE ---------------- -------------------- 9. DATE OF DISPATCH OF ORDER ---------------- --- ------------------