M/s Kochi Property Developers (P) Ltd.,, Bangalore v. ACIT, Bangalore

ITA 421/BANG/2011 | 2006-2007
Pronouncement Date: 30-03-2012 | Result: Dismissed

Appeal Details

RSA Number 42121114 RSA 2011
Assessee PAN AACCK9054B
Bench Bangalore
Appeal Number ITA 421/BANG/2011
Duration Of Justice 11 month(s) 15 day(s)
Appellant M/s Kochi Property Developers (P) Ltd.,, Bangalore
Respondent ACIT, Bangalore
Appeal Type Income Tax Appeal
Pronouncement Date 30-03-2012
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted A
Tribunal Order Date 30-03-2012
Date Of Final Hearing 21-03-2012
Next Hearing Date 21-03-2012
Assessment Year 2006-2007
Appeal Filed On 15-04-2011
Judgment Text
PAGE 1 OF 5 ITA NO.42 1/BANG/2011 1 INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCHES A BEFORE SHRI N K SAINI ACCOUNTANT MEMBER AND SHRI GEORGE GEORGE K JUDICIAL MEMBER ITA NO.421/BANG/2011 (ASST. YEAR 2006-07) M/S KOCHI PROPERTY DEVELOPERS (P) LIMITED NO.54 RICHMOND ROAD BANGALORE-25. PA NO.AACCK9054B VS THE ADDL. COMMISSIONER OF INCOME TAX LTU BANGALORE. (APPELLANT) (RESPONDENT) DATE OF HEARING : 21.03.20 12 DATE OF PRONOUNCEMENT : 30.03.2012 APPELLANT BY : SHRI C RAMESH C.A. RESPONDENT BY : SHRI B SARAVANAN JCIT O R D E R PER GEORGE GEORGE K : THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE CIT(A)-I BANGALORE DATED 28/2/2011. THE RE LEVANT ASSESSMENT YEAR IS 2006-07. 2. THE SOLITARY ISSUE THAT ARISES FOR OUR CONSIDERA TION IS WHETHER THE CIT(A) IS JUSTIFIED IN CONFIRMING THE A DDITION OF RS.28 24 000/- MADE UNDER THE PROVISIONS OF SECTION 69C OF THE ACT. PAGE 2 OF 5 ITA NO.42 1/BANG/2011 2 3. BRIEFLY STATED THE FACTS ARE AS FOLLOWS:- THE ASSESSEE IS A COMPANY. IT IS ENGAGED IN THE B USINESS OF PROPERTY DEVELOPMENT. FOR THE CONCERNED ASSESSME NT YEAR RETURN OF INCOME WAS FILED DECLARING A LOSS OF RS.9 60 710 /-. THE ASSESSMENT UNDER SECTION 143(3) OF THE ACT WAS COMPLETED VIDE ORDER DATED 31/12/2008 FIXING THE TOTAL INCOME AT RS.27 45 790/ - INSTEAD OF LOSS OF RS.9 60 710/- DECLARED BY THE ASSESSEE. THE ASSE SSING OFFICER HAD MADE AN ADDITION OF RS.28 24 000/- UNDER SECTIO N 69C OF THE ACT (UNEXPLAINED EXPENDITURE). 3.1 DURING THE PREVIOUS YEAR THE ASSESSEE HAD PURC HASED A PROPERTY AT DELHI FOR A CONSIDERATION OF RS.3 53 00 000/-. THE EXPENDITURE ON STAMP DUTY AND CORPORATION TAX AT THE TIME OF REGISTRATION AMOUNTED TO RS.28.24 LAKHS. THE ASSES SING OFFICER HELD THAT THE EXPENDITURE OF RS.28.24 LAKHS HAS NOT BEEN ACCOUNTED IN THE BOOKS OF ACCOUNTS AND BROUGHT THE SAME TO TAX BY INV OKING THE PROVISIONS OF SECTION 69C OF THE ACT. 4. BEING AGGRIEVED THE ASSESSEE CONTESTED THE ADD ITION OFRS.28.24 LAKHS BEFORE THE CIT(A). 5. THE CIT(A) VIDE HIS ORDER DATED 28.2.2011 CONFI RMED THE ADDITION MADE BY THE ASSESSING OFFICER. THE RELEVANT FINDING OF THE CIT(A) AT PARA 7 READS AS FOLLOWS:- PAGE 3 OF 5 ITA NO.42 1/BANG/2011 3 7. IN THE LIGHT OF THE ABOVE FACTS AND PLEADING BY THE AR THE BASIC QUESTION TO BE ANSWERED IS WHO ACTUALLY SPENT RS.28 24 000/- FOR THE PURCHASE OF STAMP PAPERS? THE TROUBLE HERE IS THAT NORMAL PRACTICE SEEMS TO HAVE BEEN GIVEN A GO BY AND AS SUPPORTED BY EVIDENCE APPARENTLY HAVE BEEN PURCHASED BY ONE SRI S K GOEL THE ALLEGED REPRESENTATIVE OF THE VENDOR. ON THE FACE OF SUCH EVIDENCE PRODUCED BY THE ASSESSEE THE BURDEN HAS SHIFTED TO THE ASSESSING OFFICER TO CALL FOR THE DETAILS OF SRI S K GOEL AND EXAMINE HIM AS TO THE GENUINENESS OF THE CLAIM OF SUCH EXPENDITURE AND ALSO THE CAPACITY OF SRI S K GOEL AND WHETHER HE WAS ACTING ACTUALLY AS AN AGENT OF THE VENDOR SMT. SHEELA GEHOLT OR NOT? SUCH EXERCISE NOT BEING DONE I FIND THE ADDITION DOES NOT DESERVE TO BE SUSTAINED MADE SIMPLY ON THE BASIS OF AN AVERMENT IN THE SALE DEED. BUT I ALSO FIND THAT THE ASSESSE E IS EQUALLY IN FAULT BY INVITING SUCH ADDITION BECAUSE HE HAS FAILED TO PROVIDE A CONFIRMATION LETTER FROM THE VENDOR THAT THE ENTIRE EXPENDITURE OF RS.28 24 000/- HAS BEEN BORNE BY HER EVEN ON THE FACE OF ASSESSING OFFICERS PROPOSAL TO ADD THE SAME DURING THE COURSE OF ASSESSMENT PROCEEDINGS. THIS IS A FIT CASE FOR RESTORING THE CASE TO THE ASSESSING OFFICER FOR FURTHER INVESTIGATION. BUT I HAVE NO SUCH POWER NOW. IN VIEW OF THIS I DECIDE THE CASE IN FAVOUR OF THE REVENUE BECAUSE ULTIMATELY THE BURDEN LIED ON THE ASSESSEE TO SHOW THAT THE EXPENDITURE WAS INCURRED ONLY AND ONLY BY THE VENDOR HAS NOT BEEN CORROBORATED BY ADEQUATE EVIDENCE. BESIDE THE PRINCIPLES OF PREPONDERANCE OF PROBABILITY IS THAT THE PURCHASER IN ALMOST ALL CASES OF TRANSACTION OF PROPERTY BEARS THE STAMP DUTY UNLESS A CONTRARY AGREEMENT IS MADE ALSO WEIGH HEAVILY AGAINST THE APPELLANT. 6. THE ASSESSEE BEING AGGRIEVED IS IN APPEAL BEFOR E US. PAGE 4 OF 5 ITA NO.42 1/BANG/2011 4 7. THE LEARNED AR REITERATED THE SUBMISSIONS MADE BEFORE THE INCOME TAX AUTHORITIES. 8. THE LEARNED DR PRESENT WAS DULY HEARD. 9. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS ON RECORD. AS RIGHTLY POINTED OUT BY THE C IT(A) NORMALLY IN THE CASE OF PROPERTY TRANSACTION IT IS THE PURCHAS ER WHO BEARS THE STAMP DUTY. IN THIS CASE THE PROPERTY HAS BEEN PURC HASED BY THREE SALE DEEDS. ALL THE THREE SALE DEEDS ARE DATED 3 RD MARCH 2006. CLAUSE 5 OF SALE DEED (PAGE 31) WHICH IS IDENTICAL FOR ALL THE THREE SALE DEEDS READS AS FOLLOWS:- 5. THAT THE VENDOR SHALL CLEAR AND PAY ALL DUES AND CESSES INCLUDING PROPERTY TAX UPTO THE DATE OF THE HANDING OVER OF THE POSSESSION OF THE SAID UNIT TO THE VENDEE AND THEREAFTER THE VENDEE SHALL BE RESPONSIBLE TO PAY FOR THE SAME. 9.1 THE ABOVE CLAUSE CLEARLY STIPULATES THAT THE EX PENDITURE INCURRED IN CONNECTION WITH THE TRANSFER OF THE PRO PERTY WAS TO BE INCURRED BY THE PURCHASER/VENDEE. IN THE INSTANT CA SE THE ASSESSEE HAS NOT PRODUCED ANY IOTA OF EVIDENCE TO SHOW THAT T HE SELLER OF THE PROPERTY HAD IN FACT INCURRED THE EXPENSES OF STAMP DUTY AND CORPORATION TAX. THE ASSESSEE COULD HAVE OBTAINED A CONFIRMATION LETTER FROM THE SELLER THAT AN EXPENSE AMOUNTING TO RS.28.24 LAKHS WAS BORNE BY THEM WHEN THE PROPOSAL TO ADD THIS AMOU NT WAS MADE BY THE ASSESSING OFFICER. EVEN AT THIS STAGE THE ASS ESSEE HAS NOT PAGE 5 OF 5 ITA NO.42 1/BANG/2011 5 VENTURED TO PRODUCE ANY MATERIAL/EVIDENCE TO SUGGEST THAT THE EXPENDITURE INCURRED ON ACCOUNT OF STAMP DUTY AND CO RPORATION TAX WAS BORNE BY THE VENDOR AND NOT BY THE ASSESSEE. THE REFORE WE FEEL ON FACTS THAT THE ADDITION MADE BY THE ASSESSING OFF ICER AND CONFIRMED BY THE CIT(A) IS JUSTIFIED AND NO INTERFER ENCE IS CALLED FOR. 10. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH DAY OF MARCH 2012. SD/- SD/- (N K SAINI) (GEORGE GEORGE K) ACCOUNTANT MEMBER JUDICIAL MEMBER COPY TO:- 1. THE REVENUE 2. THE ASSESSEE 3. THE CIT CONC ERNED 4. THE CIT(A) CONCERNED 5. THE DR 6. GF MSP/- BY ORDER ASST. REGISTRAR ITAT BANGALORE.