Dr. Bhupinder Singh Gaba, Yamunanagar v. DCIT, Yamunanagar

ITA 524/CHANDI/2016 | 2008-2009
Pronouncement Date: 26-10-2016 | Result: Partly Allowed

Appeal Details

RSA Number 52421514 RSA 2016
Assessee PAN ABTPG1327Q
Bench Chandigarh
Appeal Number ITA 524/CHANDI/2016
Duration Of Justice 5 month(s) 20 day(s)
Appellant Dr. Bhupinder Singh Gaba, Yamunanagar
Respondent DCIT, Yamunanagar
Appeal Type Income Tax Appeal
Pronouncement Date 26-10-2016
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted Not Allotted
Tribunal Order Date 26-10-2016
Assessment Year 2008-2009
Appeal Filed On 06-05-2016
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH CHANDIGARH BEFORE SHRI BHAVNESH SAINI JUDICIAL MEMBER ITA NO. 524/CHD/2016 ASSESSMENT YEAR: 2008-09 DR. BHUPINDER SINGH GABA VS THE DCIT GOBIND PURI ROAD CIRCLE YAMUNA NAGAR. YAMUNA NAGAR. PAN: ABTPG1327Q (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ROHIT GOEL RESPONDENT BY : SHRI MANJIT SINGH DR DATE OF HEARING : 24.10.2016 DATE OF PRONOUNCEMENT : 26 .10.2016 O R D E R THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF LD. CIT(APPEALS) KARNAL DATED 21.03.20 16 FOR ASSESSMENT YEAR 2008-09. 2. I HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PAR TIES AND PERUSED THE MATERIAL ON RECORD. 3. ON GROUND NO. 1 ASSESSEE CHALLENGED THE DISALLOWANCE OF RS. 1 61 800/- OUT OF INTEREST PAID TO UNSECURED LOANS AND INTEREST PAID ON SECURED LOAN O N NOTIONAL BASIS. THIS GROUND RELATES TO DISALLOWANC E OF RS. 1 61 800/- AS INTEREST PAID ON ACCOUNT OF INTER EST 2 FREE ADVANCE GIVEN TO MS. GEETINDER KAUR DAUGHTER AND SHRI RIPU DAMAN GABA SON OF THE ASSESSEE. THE ASSESSING OFFICER OBSERVED THAT ASSESSEE HAD DEBIT BALANCE IN THE NAME OF MS. GEETINDER KAUR AND SHRI RIPU DAMAN GABA OF RS. 12 34 000/- AND RS. 1 15 000/- RESPECTIVELY ON WHICH NO INTEREST HAD BE EN CHARGED. THESE ADVANCES HAVE BEEN GIVEN FOR NON- BUSINESS PURPOSES THEREFORE ASSESSING OFFICER MADE THE DISALLOWANCE OUT OF INTEREST PAID. IT WA ALSO NOTE D THAT SIMILAR DISALLOWANCE WAS MADE IN ASSESSMENT YEAR 20 05- 06 AND 2006-07. 3(I) THE LD. CIT(APPEALS) CONFIRMED THE ADDITION AN D DID NOT ACCEPT CONTENTION OF THE ASSESSEE THAT IN ASSES SMENT YEAR 2006-07 THE TRIBUNAL IN THE CASE OF ASSESSEE VIDE ORDER DATED 29.06.2011 DELETED THE ADDITION BECAUSE ASSESSEE HAS NOT PROVIDED EVIDENCE OR FACT WHICH CO ULD INDICATE THAT ASSESSEE HAD SUBSTANTIAL BALANCE IN H IS CAPITAL ACCOUNT FOR PROVIDING INTEREST FREE ADVANCE TO HIS CHILDREN THIS YEAR. 4. AFTER CONSIDERING RIVAL SUBMISSIONS I AM OF THE VIEW ADDITION IS WHOLLY UNJUSTIFIED. THE ASSESSEE HAS SPECIFICALLY SUBMITTED BEFORE LD. CIT(APPEALS) IN H IS WRITTEN SUBMISSION COPY OF WHICH IS FILED AT PAGE 1 OF THE PAPER BOOK THAT ASSESSEE IS HAVING OPENING CAPI TAL BALANCE OF RS. 93 70 349/- AND CLOSING BALANCE OF R S. 1 01 84 964/- AND THE SAME IS SUFFICIENT TO MEET TH E 3 DEBIT BALANCE STANDING AGAINST PROPRIETOR EITHER WITHDRAWALS FOR SON/DAUGHTERS PAYMENT. COPY OF TH E BALANCE SHEET IS FILED IN PAPER BOOK AT PAGE 9. IN ASSESSMENT YEAR 2006-07 THIS ISSUE WAS CONSIDERED BY ITAT CHANDIGARH BENCH IN THE CASE OF THE ASSESSEE I N ITA 1095/2009 DATED 26.06.2011 COPY OF WHICH IS FI LED AT PAGE 15 OF THE PAPER BOOK IN WHICH IDENTICAL GRO UND WAS CONSIDERED BY THE TRIBUNAL REGARDING DISALLOWAN CE OF INTEREST AND IT WAS CONSIDERED THAT SINCE THE AS SESSEE HAD CAPITAL BALANCE IN HIS ACCOUNT WHICH WAS SUFFIC IENT TO MEET THE IMPUGNED SUM GIVEN TO THE DAUGHTER THEREFORE ASSESSEE WAS FREE TO DIVERT THE MONEY FR OM HIS OWN ACCOUNT. SINCE ASSESSEE HAD SUFFICIENT BAL ANCE IN HIS CAPITAL ACCOUNT THEREFORE IMPUGNED IDENTIC AL ADDITION WAS DELETED. THE ASSESSEE HAS THEREFORE BEEN ABLE TO PROVE IN THIS YEAR ALSO THAT IT HAS SUFFICI ENT CAPITAL WITH HIM. THEREFORE LD. CIT(APPEALS) SHOU LD HAVE FOLLOWED ORDER OF THE TRIBUNAL AND SHOULD HAVE DELETED THE ADDITION. 5. I THEREFORE SET ASIDE THE ORDERS OF AUTHORITIE S BELOW AND DELETE THE ENTIRE ADDITION BEING THE ISSU E COVERED BY ORDER OF ITAT CHANDIGARH BENCH IN THE CA SE OF SAME ASSESSEE FOR ASSESSMENT YEAR 2006-07 DATED 29.06.2011 (SUPRA). THIS GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. 4 6. ON GROUND NO. 2 ASSESSEE CHALLENGED THE DISALLOWANCE OF EXPENSES OF RS. 1 50 000/-. THE ASSESSING OFFICER OBSERVED IN PARA 4 OF THE ASSESSM ENT ORDER THAT ON EXAMINATION OF THE VOUCHERS UNDER THE HEAD BUILDING REPAIRS & MAINTENANCE EXPENSES THE RE WERE ITEMS RELATING TO FABRICATION OF GRILLS PURCH ASE OF IRON AND STEEL ITEMS PURCHASE OF BRICKS TULLU PUM PS AND FLOOR TILES WHICH ARE EXPENSES CAPITAL IN NATUR E AND DISALLOWED THE SAME. THE ASSESSEE SUBMITTED BEFORE LD. CIT(APPEALS) THAT THESE EXPENSES WERE INCURRED FOR MAINTAINING THE EXISTING BUILDING AND NO NEW ASSETS HAVE BEEN CREATED THEREFORE IT IS NOT CAPITAL IN NATURE. THE LD. CIT(APPEALS) HOWEVER DISMISSED THIS GROUN D OF APPEAL OF THE ASSESSEE. 7. AFTER CONSIDERING RIVAL SUBMISSIONS I AM OF THE VIEW ADDITION IS EXCESSIVE IN NATURE. THE LD. COUN SEL FOR THE ASSESSEE SUBMITTED THAT ASSESSEE IS RUNNING HOSPITAL AND AMOUNTS UNDER THESE ITEMS HAVE BEEN INCURRED FOR MAINTENANCE OF THE HOSPITAL. THE ASSE SSING OFFICER HAS NOT POINTED OUT ANY SPECIFIC ITEMS WHIC H ARE CAPITAL IN NATURE WITH REFERENCE TO THEIR VALUE. I AM THEREFORE SATISFIED WITH THE EXPLANATION OF THE AS SESSEE THAT SINCE ASSESSEE IS RUNNING HOSPITAL THEREFORE MANY OF THESE AMOUNT ON THESE ITEMS WOULD HAVE BEEN INCURRED FOR REPAIR AND MAINTENANCE OF THE EXISTING BUILDING. THE ASSESSING OFFICER HAS NOT POINTED OU T AS TO HOW THE AMOUNT OF RS. 1 50 000/- IS CAPITAL IN 5 NATURE. THE ASSESSING OFFICER DID NOT DISBELIEVE T HE SUBSTANTIAL CLAIMS OF THE ASSESSEE OF INCURRING EXPENDITURE WHICH ARE REVENUE IN NATURE UNDER THIS HEAD OF EXPENSES. THEREFORE CONSIDERING THE EXPLANATION OF THE ASSESSEE AND THAT ASSESSING OFFI CER HAS NOT POINTED OUT ANY SPECIFIC AMOUNT WHICH IS CA PITAL IN NATURE I RESTRICT THE ADDITION TO RS. 50 000/- ONLY AS AGAINST ADDITION MADE BY ASSESSING OFFICER OF RS. 1 50 000/-. THIS GROUND IS PARTLY ALLOWED. 8. IN THE RESULT APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DATED : 26 TH OCTOBER 2016. POONAM COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. THE CIT DR ASSISTANT REGISTRAR ITAT CHANDIGARH