G.Karthik, Erode v. ACIT, Trichy

ITA 40/CHNY/2015 | 2010-2011
Pronouncement Date: 21-11-2017 | Result: Dismissed

Appeal Details

RSA Number 4021714 RSA 2015
Assessee PAN AKGPK2255H
Bench Chennai
Appeal Number ITA 40/CHNY/2015
Duration Of Justice 2 year(s) 10 month(s) 13 day(s)
Appellant G.Karthik, Erode
Respondent ACIT, Trichy
Appeal Type Income Tax Appeal
Pronouncement Date 21-11-2017
Appeal Filed By Assessee
Tags No record found
Order Result Dismissed
Bench Allotted D
Tribunal Order Date 21-11-2017
Date Of Final Hearing 26-07-2017
Next Hearing Date 26-07-2017
First Hearing Date 26-07-2017
Assessment Year 2010-2011
Appeal Filed On 08-01-2015
Judgment Text
D/ SMC IN THE INCOME TAX APPELLATE TRIBUNAL D/SMC BENCH CHENNAI . BEFORE SHRI CHANDRA POOJARI ACCOUNTANT MEMBER I.T.A.NO.40 /MDS./2015 ( ASSESSMENT YEAR : 2010-11) MR.G.KARTHIK PROP: M/S.K.G.K.CONSTRUCTIONS 87/A KANGEYAM ROAD NEAR TELEPHONE OFFICE KODUMUDI 638 151. ERODE DISTRICT. VS. THE ACIT CIRCLE-II TIRUCHIRAPALLI. PAN AKGPK 2255 H ( / APPELLANT ) ( / RESPONDENT ) / APPELLANT BY : MR.G.STANLY ADVOCATE / RESPONDENT BY : MR.B.SAGADEVAN JCIT D.R ! ' / DATE OF HEARING : 09.11.2017 #$%& ! ' /DATE OF PRONOUNCEMENT : 21.11.2017 / O R D E R PER CHANDRA POOJARI ACCOUNTANT MEMBER: THIS APPEAL IS FILED BY THE ASSESSEE AGGRIEVED BY THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX(A) TIRUCHIR APALLI DATED 04.09.2014 PERTAINING TO ASSESSMENT YEAR 2010-11. ITA NO. 40/MDS/2015 2 2. THE ASSESSEE RAISED THE FOLLOWING GROUNDS FOR C ONSIDERATION. 1. THE ORDER PASSED BY THE COMMISSIONER OF INCOME T AX (APPEALS) IS AGAINST THE PRINCIPLE OF NATURAL JUSTICE LAW AND F ACTS OF THE CASE. 2. THE COMMISSIONER OF INCOME TAX (APPEALS) HAS ERR ED IN CONFIRMING THE HOUSING LOAN INTEREST CLAIM OF ` 1 50 000/- U/S. 24 OF THE ACT OUT OF THE TOTAL INTEREST PAYMENT OF ` 2 20 732/- PAID TO THE STATE BANK OF INDIA KODUMUDI BRANCH WITHOUT CONSIDERING THE PERI OD OF COMPLETION OF CONSTRUCTION AS THE PROPERTY HAS BEEN SELF OCCUP IED BY THE APPELLANT. 3. THE COMMISSIONER OF INCOME TAX (APPEALS) ERRED I N CONFIRMING THE ENTIRE AMOUNT OF ` 25 18 778/- RECEIVED AS A LOAN FROM VARIOUS CREDITORS AS UNEXPLAINED CASH CREDITS U/S. 68 OF TH E ACT AND ALSO INTEREST PAYMENT MADE ON THE ABOVE CREDIT OF ` 1 74 845/-. 4. THE COMMISSIONER OF INCOME TAX (APPEALS) OUGHT T O HAVE NOTED THAT THE DETAILS OF THE CREDITORS LIST FILED BY THE APPE LLANT DURING ASSESSMENT PROCEEDINGS AND THE LEARNED ASSESSING OF FICER HAS MERELY RELIED ON THE REPORT OF THE INSPECTOR WITHOU T GIVING OPPORTUNITY TO THE APPELLANT. 5. THE COMMISSIONER OF INCOME TAX (APPEALS) HAS ERR ED IN CONFIRMING THE SUM OF ` 5 00 000/- BEING THE GIFT RECEIVED FROM APPELLANTS WIFE SMT.G. KIRTHIKA AS INCOME OF THE APPELLANT U/S. 68 OF THE IT ACT WITHOUT BRINGING TO THE KNOWLEDGE OF THE APPELLANT. 6. THE COMMISSIONER OF INCOME TAX (APPEALS) ERRED I N CONFIRMING THAT A SUM OF ` 3 00 000/- BEING THE GIFT RECEIVED BY THE APPELLANT AT THE TIME OF MARRIAGE WITHOUT POINTING OUT THIS ISSUE DURING THE ASSESSMENT PROCEEDINGS AND WITHOUT CONSIDERING THE FACTS HABI TS PREVAILING IN THE COMMUNITY AND SOCIETY. ITA NO. 40/MDS/2015 3 3. AT THE OUTSET IT WAS NOTICED THAT THERE WAS A DELAY OF 68 DAYS IN FILING THE APPEAL BEFORE THE TRIBUNAL. HOWEVER THE RE WAS NO DELAY AS IT WAS CLARIFIED BY THE LD. ASSESSING OFFICER THAT ORDER OF LD.CIT(A) WAS ACTUALLY SERVED ON THE ASSESSEE ONLY ON 10.11.2 014 AND TO THAT EFFECT REVISED FORM NO.36 WAS FILED BY THE ASSESSE E ACCORDINGLY I NOTICE THAT THERE IS NO DELAY IN FILING THE APPEAL WHICH WAS FILED IN TIME. 4. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESS EE IS AN INDIVIDUAL AND DERIVES INCOME FROM THE FOLLOWING BUSINESS / SO URCES. I. INCOME FROM HOUSE PROPERTY II. CARRYING ON THE BUSINESS OF CIVIL CONTRACTOR UN DER THE NAME AND STYLE OF M/S.K.G.K CONSTRUCTION AND DERIVING INCOME FROM THE SAID BUSINESS III. INCOME FROM OTHER SOURCES THE ASSESSEE FILED HIS RETURN OF INCOME FOR THE AY 2010-11 ON 14.02.2011 ELECTRONICALLY ADMITTING A TOTAL INCOME OF ` 17 42 070/- AND AGRICULTURAL INCOME OF ` 1 72 000/-.THE ASSESSEE HAS ALSO FILED TAX AUDIT REPORT AS REQUIRED U/S.44AB OF THE I.T ACT. T HE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS CALLED FOR VARIOUS DETAILS SUCH AS LIST OF BANK ACCOUNTS SUND RY DEBTORS/ CREDITORS DETAILS OF LOANS FROM FRIENDS AND RELATI VES ALONG WITH THEIR ADDRESSES CONFIRMATION LETTERS COPY OF HOME LOAN SANCTION LETTERS ITA NO. 40/MDS/2015 4 PROOF FOR AGRICULTURAL INCOME AND DETAILS OF MARRIA GE GIFTS AND GIFT RECEIVED FROM THE ASSESSEES WIFE. THE ASSESSEE HAS NOT PRODUCED OR FILED DETAILS AS CALLED FOR. THE ASSESSEE HAS CL AIMED LOAN CREDITORS TO THE TUNE OF ` 99 51 553/- (ALL BELOW ` 20 000) INCLUDING FRESH LOAN CREDITORS DURING THE YEAR TO THE TUNE OF ` 25 18 778/- AND MARRIAGE GIFT RECEIVED AT ` 3 LAKHS AND GIFT FROM HIS WIFE AT ` 5 LAKHS. LATER ON THE AUTHORISED REPRESENTATIVE OF THE ASSESSEE APPEARED ON 04.12.2012 AND FILED A LIST OF 521 UNSECURED LOAN CREDITORS WI TH ADDRESSES. ALL THE LOANS TAKEN ARE BELOW ` 20 000/-. NO CONFIRMATION LETTERS OR SOURCE OF THE CREDITORS IDENTITY OF FIE LOAN CREDITORS HAVE B EEN FILED. LATER ON THERE WAS A SURVEY U/S 133A CONDUCTED IN THE BUSINE SS PREMISES OF THE ASSESSEE. THE ASSESSEE HAS AGREED THAT THE LOAN CREDITS ARE NOT REAL AND GENUINE. EVEN DURING THE RANDOM VERIFICATI ON OF ADDRESSES GIVEN BY THE LOAN CREDITORS BY THE INSPECTOR OF THE DEPARTMENT NONE OF THEM WERE EXISTED IN THE GIVEN ADDRESSES AND ACCORD INGLY THE ASSESSING OFFICER HAS FINALIZED THE ASSESSMENT BY M AKING VARIOUS ADDITIONS AT ` 36 43 623/-. NATURE OF ADDITIONS AMOUNT( ` ) DISALLOWANCE OF HOUSING LOAN INTEREST PAID TO SBI O N THE GROUND THAT CONSTRUCTION IS NOT YET COMPLETED 1 50 000/- ITA NO. 40/MDS/2015 5 ASSESSMENT OF LOAN CREDITORS U/S.68 OF THE IT ACT F OR THE WANT OF GENUINENESS AND CREDIT WORTHINESS OF THE CREDITORS 25 18 778!- DISBELIEVING THE RECEIPT OF GIFT OF RS.5 00 000/- F ROM APPELLANTS WIFE SMT.G.KIRTHIKA 5 00 000/- DISBELIEVING THE RECEIPT OF GIFT BY THE APPELLANT A T THE TIME OF HIS MARRIAGE 3 00 000/- DISALLOWANCE OF INTEREST CLAIMED ON THE ALLEGED CRE DITORS ASSESSED AS INCOME 1 74 845/- TOTAL 36 43 623/- AGGRIEVED BY THE ABOVE ADDITION THE ASSESSEE CARRI ED THE APPEAL BEFORE THE LD.CIT(A). 4.1 BEFORE LD.CIT(A) THE LD.A.R OBJECTED TO THE ADDITION OF HOUSING LOAN INTEREST CLAIM OF RS.L 50 000/- U/S. 2 4 OF THE ACT OUT OF THE TOTAL INTEREST PAYMENTS OF ` 2 20 732/- PAID TO THE STATE BANK OF INDIA KODUMUDI BRANCH WITHOUT CONSIDERING THE PERI OD OF COMPLETION OF CONSTRUCTION AS THE PROPERTY HAS BEEN SELF OCCUP IED BY THE ASSESSEE. IT WAS SUBMITTED THAT THE ASSESSING OFFIC ER MADE AN ADDITION OF RS.25 18 778/- RECEIVED AS LOAN FROM VA RIOUS CREDITORS AS UNEXPLAINED CASH CREDITS U/S. 68 OF THE ACT AND INT EREST PAYMENTS MADE TO THEM AT ` 1 74 845/-. SIMILARLY THE LD.A.R OBJECTED FOR THE ADDITION OF ` 5 LAKHS AS GIFT RECEIVED FROM ASSESSEES WIFE SMT.G.KRITHIKA AS WELL AS A SUM OF ` .3 LAKHS BEING THE GIFT RECEIVED BY ITA NO. 40/MDS/2015 6 THE ASSESSEE AT THE TIME OF HIS MARRIAGE. ACCORDIN G TO LD.CIT(A) THE ABOVE ADDITIONS ARE MADE BY THE ASSESSING OFFICER A S THE ASSESSEE HAD NOT FURNISHED ANY DETAILS DURING THE COURSE OF ASSESSMENT PROCEEDINGS AS WELL AS THE ADDITIONS WERE MADE ON T HE BASIS OF SURVEY FINDINGS AND SUBSEQUENT ENQUIRY BY THE DEPAR TMENT OFFICIALS. 4.2 FURTHER THE ASSESSING OFFICER MADE AN ADDITIO N OF ` 1 50 000/- TOWARDS INTEREST PAID ON HOUSING LOAN FOR SELF OCCU PIED HOUSE. AS THE HOUSE WAS STILL UNDER CONSTRUCTION DURING THE PREVI OUS YEAR RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION THE ASSE SSE IS NOT ELIGIBLE FOR CLAIMING THE INTEREST. LD.CIT(A) OBSER VED THAT THE ASSESSING OFFICER HAS CORRECTLY DISALLOWED THE INTE REST CLAIM AT ` 1 50 000/-. HENCE THE SAME WAS CONFIRMED BY LD.CIT( A). SIMILARLY THE ASSESSEE FAILED TO PROVE THE IDENTITY AND GENUI NENESS AND CREDITWORTHINESS OF THE LOAN CREDITORS AND THE ASSE SSEE HIMSELF AGREED THAT THE LOAN CREDITORS ARE NOT REAL AND EVE N THE INSPECTORS REPORT ESTABLISHES THE FACT THAT NONE OF THE CREDIT ORS ARE EXISTING IN THE ADDRESSES GIVEN. THEREFORE THE AMOUNT INTRODUCE D IN THE NAME OF THE LOAN CREDITORS DURING THE YEAR UNDER CONSIDERAT ION AT ` .25 18 778/- HAS BEEN CONFIRMED BY THE LD.CIT(A) A S THE ASSESSEE ITA NO. 40/MDS/2015 7 FAILED TO PROVE THE GENUINENESS OF THE LOAN CREDITO RS. HENCE THE SAME WAS CONFIRMED BY LD.CIT(A). 4.3 SIMILARLY THE ASSESSEE COULD NOT PRODUCE ANY EVIDENCE OF GIFT OF ` 5 LAKHS STATED TO HAVE BEEN RECEIVED BY THE ASSESSE E FROM HIS WIFE SMT.G.KRITHIKA WHO BEING A HOUSEWIFE HAS NO I NDEPENDENT SOURCE OF INCOME ALSO NOT AN INCOME TAX ASSESSEE TO VERIFY THE CLAIM OF THE ASSESSEE. OVER AND ABOVE THE ASSESSEE HAS F AILED TO ESTABLISH THE GENUINENESS OF THE GIFT TRANSACTION B ETWEEN HIM AND HIS WIFE AT ` .5 LAKHS. ACCORDING TO LD.CIT(A) THE ADDITION MADE BY THE ASSESSING OFFICER DESERVES TO BE CONFIRMED. ACCORDI NGLY THE SAME IS CONFIRMED BY THE LD.CIT(A). 4.4 AS FAR AS ANOTHER AMOUNT OF RS.3 LAKHS STATED TO HAVE BEEN RECEIVED BY THE ASSESSEE AS MARRIAGE GIFT FROM HIS BLOOD RELATIVES THE ASSESSEE COULD NOT PRODUCE ANY DETAILS TO PROVE THE CLAIM MADE BY THE ASSESSEE. HENCE THE ADDITION MADE BY THE ASS ESSING OFFICER AT ` 3 LATHS ON ACCOUNT OF MARRIAGE GIFT RECEIVED BY THE ASSESSEE WAS CONFIRMED DISMISSING THE CLAIMS OF THE ASSESSEE. 4.5 THE ASSESSING OFFICER HAS ALSO DISALLOWED AN A MOUNT OF ` 1 74 842/- ATTRIBUTED TO THE INTEREST PAID TO THE N EW CREDITORS WHICH ITA NO. 40/MDS/2015 8 ARE UNPROVED TO THE TUNE OF ` 25 18 778/- AND ACCORDINGLY THE SAME IS CONFIRMED. 4.6 ON APPEAL LD.CIT(A) ENDORSED THE ACTION OF LD . ASSESSING OFFICER AND CONFIRMED ALL THE ADDITIONS MADE BY LD. ASSESSING OFFICER. AGAINST THE ORDER OF LD.CIT(A) NOW THE ASSESSEE IS IN APPEAL BEFORE US. 5. BEFORE ME THE AUTHORISED REPRESENTATIVE OF ASS ESSEE MADE A PLEA THAT AS THE ASSESSEE WAS NOT ABLE TO FILE REQU ISITE DETAILS DUE TO LACK OF OPPORTUNITIES PROVIDED BY THE LOWER AUTHORI TY THE ASSESSEE SEEKS ONE MORE OPPORTUNITY TO PLACE NECESSARY EVIDE NCE IN SUPPORT OF THE ABOVE GROUNDS RAISED IN THIS APPEAL BEFORE T HE LOWER AUTHORITIES. 6. ON THE OTHER HAND LD.D.R SUBMITTED THAT IN SPI TE OF GIVING VARIOUS OPPORTUNITIES TO THE ASSESSEE BY LD. ASSES SING OFFICER AS WELL AS BY LD.CIT(A) THE ASSESSEE HAS NOT PLACED ANY E VIDENCE IN SUPPORT OF HIS CLAIM. FURTHER LD.D.R SUBMITTED THA T EVEN AT THIS STAGE THERE IS NO IOTA OF EVIDENCE FOR THE ASSESSEE TO PR ODUCE BEFORE THIS TRIBUNAL AND PLEADED THAT THE APPEAL MAY BE DISMISS ED. ITA NO. 40/MDS/2015 9 7. AFTER HEARING BOTH THE PARTIES AND EXAMINING TH E ORDERS OF LOWER AUTHORITIES AS RIGHTLY POINTED OUT BY THE LD.D.R T HAT THERE WAS NO IOTA EVIDENCE IN SUPPORT OF THE CLAIM OF THE ASSESSEE I N SUPPORT OF VARIOUS DISALLOWANCES MADE BY THE LD. ASSESSING OFF ICER AND SUSTAINED BY LD.CIT(A). IN THE ABSENCE OF ANY MATE RIALS PLACED BY THE ASSESSEE BEFORE ME I AM NOT IN A POSITION TO R EMIT THE ISSUE TO THE FILE OF LD. ASSESSING OFFICER FOR FRESH CONSIDE RATION. ACCORDINGLY I HAVE NO OPTION TO CONFIRM THE ORDER OF LOWER AUTHOR ITIES. HENCE THE GROUNDS RAISED BY ASSESSEE RELATING TO VARIOUS ADD ITIONS MADE BY THE AO STAND DISMISSED AND THE ADDITIONS SUSTAINED. 8. IN THE RESULT THE APPEAL OF ASSESSEE IS DISMIS SED. ORDER PRONOUNCED ON 21 ST NOVEMBER 2017. SD/- ( ) ( CHANDRA POOJARI ) /ACCOUNTANT MEMBER CHENNAI DATED THE 21 ST NOVEMBER 2017 . K S SUNDARAM. ' ( )!*+ +%! / COPY TO: 1 . / APPELLANT 3. ' ' -! () / CIT(A) 5. +0 1 )!)23 / DR 2. / RESPONDENT 4. ' ' -! / CIT 6. 1 45 6 / GF