Thangamani Vinodhagan, Thanjavur v. ACIT, CHENNAI

ITA 418/CHNY/2011 | 2003-2004
Pronouncement Date: 18-11-2011 | Result: Dismissed

Appeal Details

RSA Number 41821714 RSA 2011
Assessee PAN AABPT5004E
Bench Chennai
Appeal Number ITA 418/CHNY/2011
Duration Of Justice 8 month(s) 16 day(s)
Appellant Thangamani Vinodhagan, Thanjavur
Respondent ACIT, CHENNAI
Appeal Type Income Tax Appeal
Pronouncement Date 18-11-2011
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted D
Tribunal Order Date 18-11-2011
Date Of Final Hearing 15-11-2011
Next Hearing Date 15-11-2011
Assessment Year 2003-2004
Appeal Filed On 03-03-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL BENCH D CHENNAI BEFORE SHRI N. S. SAINI ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN JUDICIAL MEMBER .. I.T.A. NOS. 410 TO 420/MDFS/2011 ASSESSMENT YEARS : 1993-94 1995-96 1996-97 1997-98 2001-02 2002-03 2003-04 2004-05 & 2005-0 6 SHRI THANGAMANI VINODHAGAN NO. 8C/225 SECOND CROSS STREET ARULANDANAGAR THANJAVUR-613 007. V. THE ASSISTANT COMMISSIONER OF INCOME-TAX CENTRAL CIRCLE-II(4) CHENNAI. [PAN: AABPT5004E] (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI K. RAVI CA RESPONDENT BY : SHRI K. RAMASAMY SR. STANDING COUNSEL DATE OF HEARING : 15-11-2011 DATE OF PRONOUNCEMENT : 18-11-2011 O R D E R PER BENCH: ITA NO. 410/MDS/2011 IS AN APPEAL FILED BY THE ASS ESSEE AGAINST THE ORDER OF THE LEARNED CIT(APPEALS)-II CHENNAI IN ITA NO. 255 /07-08 DATED 01-12-2010 FOR THE ASSESSMENT YEAR 1993-94. ITA NO. 411/MDS/2011 I S AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LEARNED CIT(APPEA LS)-II CHENNAI IN ITA NO. I.T.A. NO.410-420/MDS/2011 2 256/07-08 DATED 01-12-2010 FOR THE ASSESSMENT YEAR 1995-96. ITA NO. 412/MDS/2011 IS AN APPEAL FILED BY THE ASSESSEE AGA INST THE ORDER OF THE LEARNED CIT(APPEALS)-II CHENNAI IN ITA NO. 257/07-08 DATED 01-12-2010 FOR THE ASSESSMENT YEAR 1996-97. ITA NO. 413/MDS/2011 IS A N APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LEARNED CIT(APPEA LS)-II CHENNAI IN ITA NO. 258/07-08 DATED 01-12-2010 FOR THE ASSESSMENT YEAR 1997-98. ITA NO. 414/MDS/2011 IS AN APPEAL FILED BY THE ASSESSEE AGA INST THE ORDER OF THE LEARNED CIT(APPEALS)-II CHENNAI IN ITA NO. 20/08-09 DATED 01-12-2010 FOR THE ASSESSMENT YEAR 2001-02. ITA NO. 415/MDS/2011 IS AN APPEAL F ILED BY THE ASSESSEE AGAINST THE ORDER OF THE LEARNED CIT(APPEALS)-II CHENNAI I N ITA NO. 21/08-09 DATED 01-12- 2010 FOR THE ASSESSMENT YEAR 2002-03. ITA NO. 416 /MDS/2011 IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LEARNED CI T(APPEALS)-II CHENNAI IN ITA NO. 230/06-07 DATED 01-12-2010 FOR THE ASSESSMENT Y EAR 2003-04. ITA NO. 417/MDS/2011 IS AN APPEAL FILED BY THE ASSESSEE AGA INST THE ORDER OF THE LEARNED CIT(APPEALS)-II CHENNAI IN ITA NO. 185/05-06 DATED 01-12-2010 FOR THE ASSESSMENT YEAR2003-04. ITA NO. 418/MDS/2011 IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LEARNED CIT(APPEALS)-II C HENNAI IN ITA NO. 22/08-09 DATED 01-12-2010 FOR THE ASSESSMENT YEAR 2003-04. ITA NO. 419/MDS/2011 IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF T HE LEARNED CIT(APPEALS)-II CHENNAI IN ITA NO. 411/06-07 DATED 01-12-2010 FOR T HE ASSESSMENT YEAR 2004-05. ITA NO. 420/MDS/2011 IS AN APPEAL FILED BY THE ASSE SSEE AGAINST THE ORDER OF THE I.T.A. NO.410-420/MDS/2011 3 LEARNED CIT(APPEALS)-II CHENNAI IN ITA NO. 259/07- 08 DATED 01-12-2010 FOR THE ASSESSMENT YEAR 2005-06. AS ALL THESE APPEALS RELA TE TO THE SAME ASSESSEE AND INVOLVE SUBSTANTIALLY IDENTICAL ISSUES ALL THE ELE VEN APPEALS ARE BEING DISPOSED OF BY THIS COMMON ORDER. 2. SHRI K. RAVI CA REPRESENTED ON BEHALF OF THE AS SESSEE AND SHRI K. RAMASAMY SENIOR STANDING COUNSEL REPRESENTED ON BE HALF OF THE REVENUE. 3. AT THE TIME OF HEARING THE LEARNED AUTHORISED R EPRESENTATIVE SUBMITTED THAT HE WAS NOT PRESSING THE GROUNDS RELATING TO THE RE- OPENING AND VALIDITY OF THE ASSESSMENTS IN ALL THE APPEALS. CONSEQUENTLY THE GROUNDS RELATING TO THE RE- OPENING AND VALIDITY OF THE ASSESSMENTS ARE DISMISS ED AS NOT PRESSED. 4. ON MERITS IT WAS SUBMITTED BY THE LEARNED AUTHO RISED REPRESENTATIVE THAT THE ISSUES MAINLY REVOLVE AROUND TWO ISSUES THE FI RST BEING THE AGRICULTURAL INCOME DISCLOSED BY THE ASSESSEE AND TREATED AS INCOME FR OM OTHER SOURCES BY THE ASSESSING OFFICER. IT WAS SUBMITTED THAT THE ASSE SSEE OWNED 13.11 ACRES OF AGRICULTURAL LAND. IT WAS THE SUBMISSION THAT THE ASSESSEE HAD BEEN DISCLOSING AGRICULTURAL INCOME EARLIER AND IT HAD ALSO BEEN AC CEPTED. IT WAS THE SUBMISSION THAT THERE WAS A SEARCH IN THE CASE OF THE ASSESSEE S BROTHER SHRI K.V. MAHADEVEN ON 24-10-1996. SUBSEQUENT TO THE SEARCH THE ASSES SEES CASE WAS TRANSFERRED TO CHENNAI. IT WAS THE SUBMISSION THAT IN THE COURSE OF ORIGINAL ASSESSMENT THE ASSESSING OFFICER HAD TREATED THE NET AGRICULTURAL INCOME DISCLOSED BY THE ASSESSEE AS INCOME FROM OTHER SOURCES. IT WAS THE SUBMISS ION THAT ON FIRST APPEAL THE I.T.A. NO.410-420/MDS/2011 4 LEARNED CIT(A) HAD RESTORED THE ISSUE TO THE FILE O F THE ASSESSING OFFICER FOR RE- ADJUDICATION. IT WAS THE SUBMISSION THAT IN THE SE T ASIDE PROCEEDINGS THE ASSESSING OFFICER HAD ACCEPTED PART OF THE AGRICULTURAL INCOM E DISCLOSED BY FOLLOWING THE DECISION OF THE LEARNED CIT(A) IN THE ORIGINAL APPE LLATE PROCEEDINGS IN THE CASE OF THE ASSESSEES MOTHER SMT. REGINAKANTHAM. IT WAS THE SUBMISSION THAT THE ASSESSING OFFICER HAD ESTIMATED AND DISALLOWED THE BALANCE OF THE AGRICULTURAL INCOME DISCLOSED BY THE ASSESSEE AND TREATED THE SA ME AS INCOME FROM OTHER SOURCES ONLY FOR THE REASON THAT THE ASSESSEE COUL D NOT PRODUCE ANY MATERIAL EVIDENCE TO PROVE THE AGRICULTURAL INCOME. IT WAS THE SUBMISSION THAT THE FACT THAT THE ASSESSEE OWNED 13.11 ACRES OF AGRICULTURAL LAND WAS NOT DISPUTED AND IN THE COURSE OF SEARCH NO EVIDENCE HAD BEEN FOUND TO SHOW THAT THE ASSESSEE HAD ANY OTHER SOURCE OF INCOME WHICH HE HAD ATTEMPTED TO DI SCLOSE UNDER THE HEAD AGRICULTURAL INCOME. IT WAS THE SUBMISSION THAT IN THE APPEAL THE LEARNED CIT(A) HAD CONFIRMED THE ORDER OF THE ASSESSING OFFICER AG AIN ON THE GROUND THAT THE ASSESSEE COULD NOT PRODUCE ANY EVIDENCE TO SUBSTANT IATE THAT THE ASSESSEE HAD ONLY AGRICULTURAL INCOME. IT WAS THE SUBMISSION THAT TH E ASSESSEE OWNED AGRICULTURAL LAND AND ALSO THE FACT THAT AGRICULTURAL OPERATIONS HAD BEEN CARRIED OUT WERE NOT DISPUTED. IT WAS THE FURTHER SUBMISSION THAT THE A DDITION MADE BY THE ASSESSING OFFICER AND AS CONFIRMED BY THE LEARNED CIT(A) WAS LIABLE TO BE DELETED. 5. IN REPLY THE LEARNED SR. STANDING COUNSEL ON BE HALF OF THE REVENUE VEHEMENTLY SUPPORTED THE ORDERS OF THE LEARNED CIT( A) AND THE ASSESSING OFFICER. I.T.A. NO.410-420/MDS/2011 5 IT WAS THE SUBMISSION THAT NO EVIDENCE OF LAND HOLD INGS AND AGRICULTURAL OPERATIONS WAS PRODUCED BEFORE THE ASSESSING OFFICER. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PER USAL OF THE ASSESSMENT ORDER CLEARLY SHOWS THAT WHAT THE ASSESSING OFFICER HAS CONSIDERED FOR DISALLOWANCE IS OUT OF THE NET AGRICULTURAL INCOME. IN SHORT T HE ASSESSING OFFICER HAS ACCEPTED THE FACT THAT EXPENSES HAVE BEEN INCURRED FOR AGRIC ULTURAL OPERATIONS. THE ASSESSMENT YEARS INVOLVED HERE ARE 1993-94 TO 2004- 05. ASKING THE ASSESSEE TO PRODUCE PROOF OF AGRICULTURAL OPERATIONS DONE IN 19 93 WOULD BE FAR-FETCHED. IN FACT THERE IS NO EVIDENCE EVEN AFTER THE SEARCH TO SHOW THAT THE ASSESSEE WAS NOT DOING ANY AGRICULTURAL OPERATIONS. THE FACT THAT T HE ASSESSEE OWNED 13.11 ACRES OF AGRICULTURAL LAND HAS ALSO BEEN RECOGNIZED BY THE A SSESSING OFFICER. FURTHER IN THE CASE OF SMT. V. REGINAKANTHANM THE MOTHER OF THE A SSESSEE IN ITA NOS. 399 TO 409/MDS/2011 WE HAVE ALREADY HELD THAT THE AGRICULT URAL INCOME DISCLOSED IS REASONABLE AND HAS ACCEPTED THE CLAIM OF AGRICULTUR AL INCOME DISCLOSED. IN THE CIRCUMSTANCES ON ACCOUNT OF THE FACT THAT EVEN THE EXPENDITURE AS DISCLOSED BY THE ASSESSEE HAS BEEN ACCEPTED AS ALSO ON ACCOUNT OF TH E FACT THAT NO EVIDENCE WHATSOEVER WAS FOUND TO SHOW THAT THE ASSESSEE WAS NOT UNDERTAKING ANY AGRICULTURAL OPERATIONS EVEN IN THE COURSE OF SEAR CH WE ARE OF THE VIEW THAT THE CLAIM OF AGRICULTURAL INCOME AS DISCLOSED BY THE AS SESSEE IS LIABLE TO BE ACCEPTED AND WE DO SO. IN THE CIRCUMSTANCES THE DISALLOWAN CE MADE BY THE ASSESSING OFFICER AND AS CONFIRMED BY THE LEARNED CIT(A) STAN DS DELETED. HERE WE MAY ALSO I.T.A. NO.410-420/MDS/2011 6 MENTION THAT WE ARE TAKING RELIANCE ON THE FACT THA T NO EVIDENCE HAS BEEN FOUND IN THE COURSE OF SEARCH TO SHOW THAT NO AGRICULTURAL O PERATIONS WERE DONE. WE RECOGNIZE THIS AS NEGATIVE EVIDENCE THAT HAS BEEN L OOKED AT. BUT IN A SEARCH OBVIOUSLY THIS FACT WOULD ALSO COME OUT. 7. THE SECOND ISSUE IT WAS SUBMITTED BY THE LEARNE D AUTHORISED REPRESENTATIVE WAS AGAINST THE ACTION OF THE LEARNED CIT(A) IN CON FIRMING THE ADDITION ON ACCOUNT OF THE ADDITION MADE BY THE ASSESSING OFFICER IN RE SPECT OF THE RECEIPT FROM THE DEBTORS. IT WAS THE SUBMISSION THAT THE ASSESSEE H AD RECEIVED BACK CERTAIN AMOUNTS WHICH HAD BEEN GIVEN BY HIM DURING THE EARL IER YEARS TO DEBTORS. IT WAS THE SUBMISSION THAT THE ASSESSEE HAD PRODUCED CONFI RMATION LETTERS BEFORE THE ASSESSING OFFICER AND INDEPENDENT ENQUIRIES HAD ALS O BEEN MADE BY THE ASSESSING OFFICER TO WHICH THE DEBTORS HAD REPLIED ALSO DIREC TLY TO THE ASSESSING OFFICER. IT WAS THE SUBMISSION THAT ONLY BECAUSE THE PERSONS WH O WERE NOT PRODUCED FOR EXAMINATION THE DISALLOWANCE HAD BEEN MADE. IT WAS THE FURTHER SUBMISSION THAT IN RESPECT OF ONE OF THE CASES THE ASSESSING OFFICER H AS ALSO MENTIONED THAT THERE WAS DIFFERENCE IN THE SIGNATURE WHEN COMPARED WITH THE CONFIRMATION LETTER. IT WAS THE SUBMISSION THAT THE DEBTORS HAD REPAID THE AMOUNTS TO THE ASSESSEE AND THE DEBTORS WERE RESIDENTS OF THANJAVUR AND THEY WERE U NWILLING TO APPEAR BEFORE THE ASSESSING OFFICER AT CHENNAI. IT WAS THE SUBMISSIO N THAT THE DEBTS VARIED BETWEEN ` 810/- ` 4240/- AND THE MAXIMUM AMOUNT WAS AN AMOUNT OF ` 19 570/-. IT WAS THE SUBMISSION THAT THERE IS NO ALLEGATION BY THE A SSESSING OFFICER THAT THE CLAIM OF I.T.A. NO.410-420/MDS/2011 7 DEBTORS WAS NOT GENUINE OR WITH REGARD TO THE AMOUN TS AS MENTIONED IN THE CONFIRMATION LETTERS AS ALSO THE LETTERS SENT DIREC TLY TO THE ASSESSING OFFICER IN RESPONSE TO THE LETTERS OF THE ASSESSING OFFICER. IT WAS THE SUBMISSION THAT JUST BECAUSE THE DEBTORS REFUSED TO APPEAR FOR REASONS B EST KNOWN TO THEM THE ADDITION SHOULD NOT BE MADE IN THE HANDS OF THE ASS ESSEE ESPECIALLY WHEN THE CONFIRMATIONS HAD ALSO BEEN CALLED FOR BEHIND THE B ACK OF THE ASSESSEE AND THE SAME HAD ALSO BEEN RECEIVED BY THE ASSESSING OFFICE R. 8. IN REPLY THE LEARNED SR. STANDING COUNSEL ON BE HALF OF THE REVENUE VEHEMENTLY SUPPORTED THE ORDERS OF THE ASSESSING OF FICER AND THE LEARNED CIT(A). 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PER USAL OF THE ASSESSMENT ORDER CLEARLY SHOWS THAT THE ASSESSEE HAD PRODUCED CONFIRMATION LETTERS FROM THE DEBTORS. IT IS ALSO NOTICED THAT THE ASSESSING OFF ICER HAD SENT LETTERS TO THE DEBTORS AND MANY OF THEM HAD REPLIED STATING THE REASONS TH EREIN FOR THEIR NON-APPEARANCE. THERE IS NO AVERMENT IN THE ASSESSMENT ORDER THAT A NY OF THE DEBTORS HAD DENIED THE TRANSACTION. IN THE CIRCUMSTANCES WE ARE OF T HE VIEW THAT NO ADDITION CAN BE MADE ON THIS COUNT IN THE HANDS OF THE ASSESSEE. I N THE CIRCUMSTANCES THE ADDITION AS MADE BY THE ASSESSING OFFICER STANDS DE LETED. 10. IN THE RESULT ITA NO. 410/MDS/2011 ON THE ISS UES IN ITEM NO.1 & 2 DECIDED ABOVE RESULTS IN THE APPEAL OF THE ASSESSEE BEING PARTLY ALLOWED.; ITA NO. 411/MDS/2011 ON THE ISSUE IN ITEM NO.1 DECIDED ABO VE RESULTS IN THE ASSESSEES APPEAL BEING PARTLY ALLOWED; ITA NO. 412/MDS/2011 ON THE ISSUE IN ITEM NO.1 I.T.A. NO.410-420/MDS/2011 8 DECIDED ABOVE RESULTS IN THE ASSESSEES APPEAL BEI NG PARTLY ALLOWED; ITA NO. 413/MDS/2011 ON THE ISSUE IN ITEM NO.1 DECIDED ABOV E RESULTS IN THE ASSESSEES APPEAL BEING PARTLY ALLOWED AND ITA NO. 417/MDS/201 1 ON THE ISSUE IN ITEM NO.1 DECIDED ABOVE RESULTS IN THE ASSESSEES APPEAL BEI NG PARTLY ALLOWED. NO OTHER GROUNDS HAVE BEEN CONTESTED IN ANY OF THE ABOVE APP EALS. 11. COMING TO ITA NOS. 414 415 & 416/MDAS/2011 IT WAS SUBMITTED BY THE LEARNED AUTHORISED REPRESENTATIVE THAT THEY RELATED TO THE ASSESSMENT YEARS 2001- 02 2002-03 AND 2003-04 AND WERE AGAINST THE ACTION OF THE LEARNED CIT(A) IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER IN D ISALLOWING THE DEPRECIATION ON THE CAR USED BY THE ASSESSEE FOR THE BUSINESS OF THE FI RM IN WHICH THE ASSESSEE WAS A PARTNER. IT WAS THE SUBMISSION THAT THIS DISALLOWA NCE HAD BEEN DONE IN SEC. 154 PROCEEDINGS. THE LEARNED AUTHORISED REPRESENTATIVE DREW OUR ATTENTION TO THE ORDER OF THE ASSESSING OFFICER PASSED U/S 154 WHEREIN THE ASSESSING OFFICER HAS CATEGORICALLY MENTIONED THAT SINCE THE ASSESSEE HA S NOT PROVED THAT THIS EXPENDITURE IS INCURRED TO EARN THE INCOME DECLARED THIS EXPENDITURE WAS ALLOWED BY MISTAKE. IT WAS THE SUBMISSION THAT AS THE ASS ESSING OFFICER HIMSELF HAS MENTIONED THAT THE PROOF OF THE EXPENDITURE NEEDS T O BE VERIFIED THE ISSUE NO MORE REMAINS A MISTAKE APPARENT FROM RECORD BUT IS A HIG HLY DEBATABLE ISSUE. IT WAS THE SUBMISSION THAT THE ORDER PASSED U/S 154 FOR ALL TH E 3 YEARS WAS LIABLE TO BE QUASHED. IN THE PASSING IT WAS ALSO MENTIONED THAT IN THE ORIGINAL ASSESSMENT I.T.A. NO.410-420/MDS/2011 9 ORDER PASSED THE AGRICULTURAL INCOME DISCLOSED BY T HE ASSESSEE FOR ALL THESE YEARS HAD BEEN ACCEPTED BY THE REVENUE. 12. IN REPLY THE LEARNED STANDING COUNSEL ON BEHAL F OF THE REVENUE SUBMITTED THAT THE DISALLOWANCE OF DEPRECIATION WAS NOT A DEB ATABLE ISSUE. IT WAS THE SUBMISSION THAT THE VEHICLE HAVING NOT BEEN USED IN THE BUSINESS OF THE ASSESSEE DEPRECIATION WAS LIABLE TO BE DISALLOWED. IT WAS T HE SUBMISSION THAT A MISTAKE APPARENT FROM RECORD COULD RIGHTLY BE RECTIFIED BY INVOKING THE PROVISIONS OF SEC. 154 OF THE INCOME TAX ACT 1961. 13. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. THE FACT THAT THE ASSESSING OFFICER HIMSELF HAS CATEGORICALLY MENTIONED THAT TH E PROOF OF THE EXPENDITURE IN RESPECT OF THE USE OF THE CAR FOR EARNING THE INCOM E HAVING BEEN REQUIRED FOR VERIFICATION CLEARLY REMOVES THE ISSUE OUT OF THE P URVIEW OF A MISTAKE APPARENT FROM THE RECORD. MISTAKE APPARENT FROM THE RECORD COU LD BE ARITHMETICALLY MISTAKE AND NON-APPLICATION OF THE CORRECT PROVISION OF THE LAW . IT CAN EVEN GO TO THE EXTENT OF WRONG COMPUTATION BUT IT CANNOT WITHIN ITS REACH TA KE AN ISSUE OF EXAMINATION OF EVIDENCE OR PROVING OF EXPENDITURE. IN THE CIRCUMS TANCES WE ARE OF THE VIEW THAT THE ISSUE CANNOT BE DECIDED IN A RECTIFICATION APPL ICATION BY INVOKING THE PROVISIONS OF SEC. 154 AND THE SAME IS NOT A MISTAKE APPARENT FROM RECORD BUT IS A HIGHLY DEBATABLE ISSUE. IN THE CIRCUMSTANCES THE ORDER P ASSED UNDER SECTION 154 DATED 27-03-2008 FOR THE ASSESSMENT YEARS 2001-02 20022- 03 AND 2003-04 STANDS I.T.A. NO.410-420/MDS/2011 10 QUASHED. IN THE CIRCUMSTANCES THE APPEALS OF THE ASSESSEE IN ITA NOS. 414 415 & 416/MDS/2011 STAND ALLOWED. 14. IN REGARD TO ITA NO. 418/MDS/2011 IT WAS SUBMIT TED BY THE LEARNED AUTHORISED REPRESENTATIVE THAT THE ASSESSING OFFICE R HAD LEVIED PENALTY U/S 271(1)(B) OF THE INCOME TAX ACT 1961 ON ACCOUNT OF THE NON-REPRESENTATION IN THE ASSESSMENT PROCEEDINGS MORE SPECIFICALLY FOR NOT R ESPONDING TO THE NOTICES ISSUED UNDER SECTIONS 142(1) 143(2) ETC. IT WAS THE S UBMISSION THAT THE ASSESSEE WAS UNDER THE BONA FIDE BELIEF THAT HE HAD NO TAXABLE INCOME FOR THE RELEVA NT ASSESSMENT YEAR AND CONSEQUENTLY THE FAILURE HAD OC CURRED. 15. IN REPLY THE LEARNED STANDING COUNSEL ON BEHAL F OF THE REVENUE SUBMITTED THAT IF THE ASSESSEE WAS UNDER THE BELIEF THAT HE H AD NO TAXABLE INCOME NOTHING PREVENTED HIM FROM REPRESENTING AND RESPONDING TO T HE NOTICES ISSUED. HE VEHEMENTLY SUPPORTED THE ORDERS OF THE ASSESSING OF FICER AND THE LEARNED CIT(A). 16. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. IT I S NOTICED HERE IN THE PRESENT CASE THAT REPEATED NOTICES HAVE BEEN ISSUED AND THE RE HAS BEEN NON-COOPERATION BY THE ASSESSEE. JUST BECAUSE THE ASSESSEE WAS UND ER SOME BONA FIDE BELIEF THAT HE DID NOT HAVE TAXABLE INCOME CANNOT GIVE ROOM TO THE ASSESSEE NOT TO RESPOND TO A STATUTORY NOTICE ISSUED BY THE ASSESSING OFFICER. THE REASONS SUBMITTED BY THE LEARNED AUTHORISED REPRESENTATIVE ARE NOT FOUND TO BE SATISFACTORY NOR HAS THE LEARNED AUTHORISED REPRESENTATIVE BEEN ABLE TO CONV INCE US IN REGARD TO THE BONA FIDE BELIEF. IN THE CIRCUMSTANCES WE ARE OF THE VIEW THAT THE LEVY OF PENALTY UNDER I.T.A. NO.410-420/MDS/2011 11 SECTION 271(1)(B) OF THE ACT AS CONFIRMED BY THE LE ARNED CIT(A) IS ON A RIGHT FOOTING AND DOES NOT CALL FOR ANY INTERFERENCE. IN THE CIR CUMSTANCES THE APPEAL OF THE ASSESSEE IN ITA NO. 418/MDS/2011 STANDS DISMISSED. 17. IN REGARD TO ITA NOS. 419 & 420/MDS/2011 IT WAS SUBMITTED BY THE LEARNED AUTHORISED REPRESENTATIVE THAT THE ISSUE WAS AGAINS T THE ACTION OF THE LEARNED CIT(A) IN CONFIRMING THE DISALLOWANCE OF DEPRECIATI ON AND INTEREST PAID ON THE CAR USED BY THE ASSESSEE FOR BUSINESS PURPOSES OF THE F IRM IN WHICH THE ASSESSEE WAS A PARTNER. IT WAS THE SUBMISSION THAT AS THE ASSESSE E HAD USED THE VEHICLE FOR BUSINESS PURPOSE DEPRECIATION WAS LIABLE TO BE ALL OWED. 18. IN REPLY THE LEARNED SR. STANDING COUNSEL ON B EHALF OF THE REVENUE SUBMITTED THAT USING CAR FOR THE BUSINESS OF THE AS SESSEE AND USING CAR FOR DOING THE BUSINESS OF THE FIRM IN WHICH THE ASSESSEE WAS A PARTNER ARE TWO DIFFERENT ISSUES. IT WAS THE SUBMISSION THAT THE ASSESSEES BUSINESS IS NOT THE BUSINESS OF THE FIRM. IT WAS THE SUBMISSION THAT THE ASSESSEE MIGHT BE A PARTNER IN THE FIRM BUT THE FIRM IS ASSESSED AS AN INDEPENDENT ENTITY A ND AFTER TAXES THE BALANCE PROFITS ARE APPORTIONED TO THE PARTNERS. IT WAS THE SUBMIS SION THAT JUST BECAUSE A PARTNER USES A VEHICLE WHICH IS IN HIS OWN NAME FOR DOING THE BUSINESS OF THE PARTNERSHIP FIRM IN WHICH HE IS A PARTNER IT CANNOT BE HELD TH AT THE ASSESSEE IS DOING THE BUSINESS FOR WHICH DEPRECIATION AND INTEREST COULD BE ALLOWED ON THE VEHICLE. 19. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. AS R IGHTLY POINTED OUT BY THE LEARNED SR. STANDING COUNSEL ON BEHALF OF THE REVEN UE THE BUSINESS OF THE FIRM IS I.T.A. NO.410-420/MDS/2011 12 DIFFERENT FROM THE ACTIVITIES OF THE PARTNERS OF TH E FIRM. JUST BECAUSE THE PARTNER HAS USED HIS VEHICLE FOR DOING THE BUSINESS OF THE FIRM IN WHICH HE IS A PARTNER THE PARTNER WOULD NOT BE ENTITLED TO DEPRECIATION AND I NTEREST CLAIMED IN RESPECT OF THE VEHICLE INSOFAR AS THE VEHICLE HAS NOT BEEN USED IN THE BUSINESS OF THE ASSESSEE. SECTION 32 OF THE ACT CATEGORICALLY USES THE TERM USED FOR THE PURPOSE OF THE BUSINESS OR PROFESSION. THE BUSINESS OF THE ASSES SEE AS A PARTNER IN THE FIRM IS NOT THE SAME AS THE BUSINESS DONE BY THE FIRM. IN THE CIRCUMSTANCES WE ARE OF THE VIEW THAT THE FINDING OF THE LEARNED CIT(A) ON THIS ISSUE IS ON A RIGHT FOOTING AND DOES NOT CALL FOR ANY INTERFERENCE. 20. IT WAS THE FURTHER SUBMISSION BY THE LEARNED AU THORISED REPRESENTATIVE IN ITA NO. 419/MDS/2011 THAT ANOTHER ISSUE IN REGARD TO TH E CASH CREDIT WAS ALSO THERE. IT WAS SUBMITTED THAT THIS AMOUNT WAS RECEIVED FROM TH E SISTER OF THE ASSESSEE FOR MEETING THE FAMILY EXPENSES OF THE SISTER WHO WAS S TAYING WITH THE ASSESSEE. IT WAS FAIRLY AGREED THAT NO CONFIRMATION LETTER HAD B EEN PRODUCED FROM THE ASSESSEES SISTER. 21. IN REPLY THE LEARNED SR. STANDING COUNSEL ON B EHALF OF THE REVENUE VEHEMENTLY SUPPORTED THE ORDERS OF THE LEARNED CIT( A) AND THE ASSESSING OFFICER. 22. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. AS I T IS NOTICED THAT NO EVIDENCE HAS BEEN PRODUCED IN THE FORM OF CONFIRMATION LETTE RS OR ANY OTHER DOCUMENTARY EVIDENCE TO SHOW THAT THE AMOUNT WAS RECEIVED FROM THE ASSESSEES SISTER THE FINDING OF THE LEARNED CIT(A) ON THIS ISSUE STANDS CONFIRMED. I.T.A. NO.410-420/MDS/2011 13 23. IT WAS THE FURTHER SUBMISSION THAT IN ITA NO. 4 20/MDS/2011 AN ISSUE OF CASH CREDIT DISALLOWED TO AN EXTENT OF ` 50 000/- HAD BEEN RAISED. IT WAS THE SUBMISSION THAT THIS CASH CREDIT OF ` 50 000/- DEPOSITED IN THE BANK ACCOUNT WAS OUT OF THE PAST SAVINGS OF THE ASSESSEE AS ALSO OUT OF HIS AGR ICULTURAL INCOME. IT WAS THE SUBMISSION THAT THE ADDITION MAY BE DELETED. 24. IN REPLY THE LEARNED SR. STANDING COUNSEL ON B EHALF OF THE REVENUE VEHEMENTLY SUPPORTED THE ORDERS OF THE LEARNED CIT( A) AND THE ASSESSING OFFICER. 25. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. AS I T IS NOTICED THAT THE ASSESSEE DOES HAVE AGRICULTURAL INCOME AND ALSO CONSIDERING THE FACT THAT THE ISSUE IS VERY MUCH OLD AND IT WOULD BE PRACTICALLY DIFFICULT FOR THE ASSESSEE TO PRODUCE ANY SUBSTANTIAL EVIDENCE IN THIS REGARD TAKING A REASO NABLE VIEW THE ASSESSING OFFICER IS DIRECTED TO REDUCE THE ADDITION OF THIS AMOUNT TO ` 25 000/-. IN THE CIRCUMSTANCES THE APPEAL OF THE ASSESSEE IN ITA NO. 419/MDS/2011 IS DISMISSED AND ITA NO. 420/MDS/2011 IS PARTLY ALLOWED. 26. THE ORDER WAS PRONOUNCED IN THE COURT ON 18/11/ 2011. SD/- SD/- (N. S. SAINI) (GEORGE MATHAN) ACCOUNTANT MEMBER JUDICIAL MEMBER CHENNAI DATED THE 18 TH NOVEMBER 2011. H. COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE