SHRI PANKAJ BAFNA, Indore v. THE ITO 3(2), Indore

ITA 598/IND/2016 | 2009-2010
Pronouncement Date: 28-09-2016 | Result: Dismissed

Appeal Details

RSA Number 59822714 RSA 2016
Assessee PAN AGSPB2310A
Bench Indore
Appeal Number ITA 598/IND/2016
Duration Of Justice 3 month(s) 25 day(s)
Appellant SHRI PANKAJ BAFNA, Indore
Respondent THE ITO 3(2), Indore
Appeal Type Income Tax Appeal
Pronouncement Date 28-09-2016
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted SMC
Tribunal Order Date 28-09-2016
Date Of Final Hearing 07-09-2016
Next Hearing Date 07-09-2016
Assessment Year 2009-2010
Appeal Filed On 03-06-2016
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH INDORE .. .. % BEFORE SHRI D.T. GARASIA JUDICIAL MEMBER AND SHRI O.P. MEENA ACCOUNTANT MEMBER SHRI PANKAJ BAFNA 403 AISHWARYA APPT. 25/1 NEW PALASIA INDORE. .. ./ PAN: AGSPB2310A VS. ITO 3(2) INDORE. / APPELLANT / RESPONDENT / APPELLANT BY SHRI C.P.RAWKA C. A. / RESPONDENT BY SHRI K. G. GOYAL DR DATE OF HEARING 07.09.2016 DATE OF PRONOUNCEMENT 28.09.2016 / O R D E R PER O.P. MEENA ACCOUTANT MEMEBR. THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER OF LD. COMMISSIONER OF INCOME-TAX (APPEALS)-I INDORE [HEREINAFTER .. . / I.T.A. NO.598/IND/2016 %' ' / ASSESSMENT YEAR: 2009-10 ITA NO.598/IND/16 AY : 09-10 PANKAJ BAFNA INDORE. PAGE 2 OF 16 REFERRED TO AS THE CIT(A)] DATED 18.03.2016 AND PER TAINS TO ASSESSMENT YEAR 2009-10 AS AGAINST APPEAL DECIDED I N RESPECT OF ASSESSMENT ORDER DATED 23.12.2011 OF ITO WARD 3( 2) INDORE [HEREINAFTER REFERRED TO AS THE AO]. 2. GROUND NOS. 1 & 2 RELATE TO CONFIRMING THE ADDITION OF RS. 13 LAKHS BY INVOKING THE PROVISIONS OF SECTION 50C OF THE INCOME-TAX ACT 1961 AND REJECTING THE CLAIM OF EXE MPTION OF LONG TERM CAPITAL GAIN U/S 54F BEING INVESTMENT MAD E IN RESIDENTIAL HOUSE. BOTH GROUNDS ARE BEING CONSIDERE D TOGETHER. 3. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE ASSE SSEE HAS SOLD A PIECE OF LAND ON 26.05.2008 FOR RS. 12 L AKHS WHICH WAS VALUED BY THE STAMP DUTY AUTHORITIES AT RS. 25 LAKHS. THE ASSESSEE DID NOT MAKE ANY CLAIM U/S 54F IN THE ORIGINAL RETURN OF INCOME. HOWEVER THE ASSESSEE MADE A CLA IM U/S 54F DURING ASSESSMENT PROCEEDINGS BEFORE THE AO. IT WAS CLAIMED BY THE ASSESSEE THAT A RESIDENTIAL HOUSE WAS PURCHASED ON 22.03.2010 FOR RS. 25 LAKHS. SINCE THE NEW PROPERTY WAS PURCHASED WITHIN TWO YEARS OF THE SALE O F ORIGINAL PROPERTY THE ASSESSEE WAS ENTITLED FOR DEDUCTION U/ S 54-F. SINCE NEW PROPERTY WAS PURCHASED WITHIN TWO YEARS HENC E ITA NO.598/IND/16 AY : 09-10 PANKAJ BAFNA INDORE. PAGE 3 OF 16 SECTION 50C WILL NOT COME INTO PLAY. ACCORDINGLY TH E AO MADE ADDITION OF RS. 13 LAKHS (RS. 25 LAKHS RS. 1 2 LAKHS) ON ACCOUNT OF LONG TERM CAPITAL GAIN BY DENYING DEDUC TION IN 54F OF THE ACT. AGGRIEVED THE ASSESSEE FILED APPEAL BE FORE CIT(A). 4. THE LD. CIT(A) NOTED THAT THE ASSESSEE HAS FILED TH E RETURN OF INCOME ON 27.09.2009 AND THE NEW PROPERTY WAS PURCHASED ON 22.03.2010 BEFORE THE END OF TWO YEARS FROM THE DATE OF SALE OF PROPERTY. HOWEVER THE ASSESSEE DI D NOT UTILIZE THE FUNDS BEFORE FILING OF THE RETURN WHICH HE SHOU LD HAVE DEPOSITED THE AMOUNT IN THE SPECIFIED BANK ACCOUNT TO CLAIM DEDUCTION U/S 54F IN THE PRESENT ASSESSMENT YEAR. T HEREFORE THE AO DISALLOWED THE CLAIM OF THE ASSESSEE. THE LD . CIT(A) HAS ALSO PLACING RELIANCE ON THE DECISION OF HON'BLE SU PREME COURT IN THE CASE OF PRAKASH NATH KHANNA VS. CIT 266 ITR 1 HELD THAT DUE DATE MEANS DUE DATE OF FILING OF RETURN U/ S 139(1) AND SINCE THE ASSESSEE DID NOT DEPOSIT THE MONEY IN A SPECIFIED BANK ACCOUNT BEFORE 27.09.2010 THE AO HA S RIGHTLY DISALLOWED THE CLAIM OF THE ASSESSEE. CONSEQUENTLY SECTION 50C AUTOMATICALLY CAME INTO PLAY. AGGRIEVED THE AS SESSEE FILED THIS APPEAL BEFORE THIS TRIBUNAL. ITA NO.598/IND/16 AY : 09-10 PANKAJ BAFNA INDORE. PAGE 4 OF 16 5. THE LD. COUNSEL FOR THE ASSESSEE CONTENDED THAT SECTION 54F IS A BENEFICIAL PROVISION FOR PROMOTING THE CONSTRUCTION OF RESIDENTIAL HOUSE AND REQUIRED TO B E CONSTRUED LIBERALLY FOR ACHIEVING THAT PURPOSE. CITING VARIOU S JUDICIAL PRECEDENCE THE LD. AUTHORIZED REPRESENTATIVE OF TH E ASSESSEE CLAIMED THAT BENEFIT U/S 54F IS ALLOWABLE WHEN THE CA PITAL GAIN REALIZED FROM THE SALE OF CAPITAL ASSETS SHOUL D BE PARTED BY THE ASSESSEE AND INVESTED EITHER IN PURCHASING R ESIDENTIAL HOUSE OR IN CONSTRUCTING RESIDENTIAL HOUSE. IF THE ASSESSEE HAS INVESTED THE MONEY IN PURCHASE OF RESIDENTIAL HOUSE WITHIN TWO YEARS OF SALE OF OLD ASSET SALE PROCEEDS WERE N OT DEPOSITED IN SPECIFIED CAPITAL GAIN ACCOUNT BEFORE DUE DATE OF FILING OF RETURN OF INCOME THE ASSESSEE WOULD NOT DISENTITLE THE ASSESSEE FROM CLAIMING THE BENEFIT U/S 54F. THE LD. AUTHORIZED REPRESENTATIVE OF THE ASSESSEE HAS ALSO PLACED RELI ANCE IN THE CASE OF CIT VS. K.RAMCHANDRA RAO (2015) 230 TAXMAN 0334 (KAR) WHEREIN IT WAS HELD AS UNDER :- AS IS CLEAR FROM SUB SECTION (4) IN THE EVENT OF TH E ASSESSEE NOT INVESTING THE CAPITAL GAINS EITHER IN PURCHASING THE RESIDENTIAL HOUSE OR IN CONSTRUCTING A ITA NO.598/IND/16 AY : 09-10 PANKAJ BAFNA INDORE. PAGE 5 OF 16 RESIDENTIAL HOUSE WITHIN THE PERIOD STIPULATED IN SECTION 54F(1) IF THE ASSESSEE WANTS THE BENEFIT O F SECTION 54F THEN HE SHOULD DEPOSIT THE SAID CAPITA L GAINS IN AN ACCOUNT WHICH IS DULY NOTIFIED BY THE CENTRAL GOVERNMENT. IN OTHER WORDS IF HE WANT OF CLAIM EXEMPTION FROM PAYMENT OF INCOME TAX BY RETAINING THE CASH THEN THE SAID AMOUNT IS TO BE INVESTED IN THE SAID ACCOUNT. IF THE INTENTION IS N OT TO RETAIN CASH BUT TO INVEST IN CONSTRUCTION OR ANY PURCHASE OF THE PROPERTY AND IF SUCH INVESTMENT IS MADE WITHIN THE PERIOD STIPULATED THEREIN THEN SECTION 54F(4) IS NOT AT ALL ATTRACTED AND THEREFOR E THE CONTENTION THAT THE ASSESSEE HAS NOT DEPOSITED THE AMOUNT IN THE BANK ACCOUNT AS STIPULATED AND THEREFORE HE IS NOT ENTITLED TO THE BENEFIT EVEN T HOUGH HE HAS INVESTED THE MONEY IN CONSTRUCTION IS ALSO N OT CORRECT. 6. IN THE LIGHT OF THE ABOVE THE LD. AUTHORIZED REPRESENTATIVE OF THE ASSESSEE CONTENDED THAT THE A SSESSEE OUGHT TO HAVE BEEN ALLOWED DEDUCTION U/S 54F OF THE ACT. ITA NO.598/IND/16 AY : 09-10 PANKAJ BAFNA INDORE. PAGE 6 OF 16 7. THE LD. DEPARTMENTAL REPRESENTATIVE HAS SUPPORTED THE ORDERS OF THE LOWER AUTHORITIES AND SUBMITTED T HAT THE CONDITIONS OF SECTION 54(4) OF THE ACT ARE MANDATOR Y WHICH REQUIRES THAT THE SALE CONSIDERATION OF CAPITAL GAI NS IF REMAINS UNUTILIZED BEFORE DUE DATE OF FILING OF RETURN OF I NCOME IS REQUIRED TO BE DEPOSITED IN CAPITAL GAINS SCHEME AC COUNTS. SINCE IN THE PRESENT CASE THE ASSESSEE HAS FAILED TO DEPOSIT THE NET CAPITAL GAINS CONSIDERATION IN THE SPECIFIE D BANK ACCOUNT THEREFORE THE ASSESSEE IS NOT ENTITLED TO THE DEDUCTION U/S 54F OF THE ACT. THE LD. DEPARTMENTAL REPRESENTATIVE ALSO CONTENDED THAT THE ASSESSEE HI MSELF HAS OFFERED THE CAPITAL GAINS FOR TAXATION IN THE ORIGI NAL RETURN OF INCOME. IT IS ONLY LATER ON THE AO HAS INVOKED THE PROVISIONS OF SECTION 50C OF THE ACT THE ASSESSEE HAS MADE TH IS CLAIM DURING ASSESSMENT PROCEEDINGS. THE ASSESSEE HAS T HUS CHANGED HIS STAND AND MADE A CLAIM U/S 54F WHICH IS ALSO NOT CERTAIN UNDER WHICH SECTION THE ASSESSEE HAS MAD E THE CLAIM. 8. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND FROM THE ASSESSMENT RECORDS THAT THE ASSESSEE HAS S OLD HIS ITA NO.598/IND/16 AY : 09-10 PANKAJ BAFNA INDORE. PAGE 7 OF 16 LAND SITUATED AT LAXMI BAI WARD HARDA ON 26.05.20 08 FOR RS. 13 50 000/- ON WHICH THE ASSESSEE HAS DISCLOSED RS. 2 57 696/- AS LONG TERM CAPITAL GAIN AND OFFERED TH E SAME FOR TAXATION IN HIS RETURN OF INCOME. HOWEVER DURING T HE SCRUTINY THE AO FOUND THAT STAMP DUTY VALUATION OF SAID LAND WAS AT RS. 25 LAKHS. ACCORDINGLY THE AO MADE ADDITION OF RS. 13 LAKHS BY INVOKING THE PROVISIONS OF SECTION 50C OF THE INCOME- TAX ACT 1961. THE AO ALSO OBSERVED THAT THE ASSESS EE HAS NOT MADE ANY CLAIM U/S 54F IN HIS RETURN OF INCOME. THI S WAS CAME TO BE CONFIRMED BY THE LD. CIT(A). WE ALSO FI ND THAT THE ASSESSEE HAS PURCHASED A RESIDENTIAL HOUSE FOR RS. 25 LAKHS ON 22 ND MARCH 2010 AND CLAIMED DEDUCTION U/S 54F AS THE INVESTMENT WAS MADE WITHIN TWO YEARS OF THE DATE OF SA LE OF OLD PROPERTY. HOWEVER THE CLAIM U/S 54F MADE BY TH E ASSESSEE WAS DENIED AS THE ASSESSEE HAS FAILED TO D EPOSIT THE MONEY IN A SPECIFIED BANK ACCOUNT BEFORE DUE DATE O F FILING OF RETURN U/S 139(1) I.E. 27.09.2010. IN ORDER TO APP RECIATE THE PROVISIONS OF SECTION 54F IT IS NECESSARY TO REPRO DUCE THE SAID PROVISIONS U/S 54F :- ITA NO.598/IND/16 AY : 09-10 PANKAJ BAFNA INDORE. PAGE 8 OF 16 SECTION 54F(4): (4) THE AMOUNT OF THE NET CONSIDERATION WHICH IS NOT APPROPRIATED BY THE ASSESSEE TOWARDS THE PURCHASE OF THE NEW ASSET MADE WITHIN ONE YEAR BEFORE THE DATE ON WHICH THE TRANSFER OF THE ORIGINAL ASSET TOOK PLACE OR WHICH IS NOT UTILIZED BY HIM FOR THE PURCHASE OR CONSTRUCTION OF THE NEW ASSET BEFORE THE DATE OF FURNISHING THE RETURN OF INCOME UNDER SECTION 139 SHALL BE DEPOSITED BY HIM BEFORE FURNISHING SUCH RETURN SUCH DEPOSIT BEING MADE IN ANY CASE NOT LATER THAN THE DUE DATE APPLICABLE IN THE CASE OF THE ASSESSEE FOR FURNISHING THE RETURN OF INCOME UNDER SUB-SECTION (1) OF SECTION 139 IN AN ACCOUNT IN ANY SUCH BANK OR INSTITUTION AS MAY BE SPECIFIED IN AND UTILIZED IN ACCORDANCE WITH ANY SCHEME WHICH THE CENTRAL GOVERNMENT MAY BY NOTIFICATION IN THE OFFICIAL GAZETTE FRAME IN THIS BEHALF AND SUCH RETURN SHALL BE ITA NO.598/IND/16 AY : 09-10 PANKAJ BAFNA INDORE. PAGE 9 OF 16 ACCOMPANIED BY PROOF OF SUCH DEPOSIT ; AND FOR THE PURPOSES OF SUB-SECTION (1) THE AMOUNT IF ANY ALREADY UTILIZED BY THE ASSESSEE FOR THE PURCHASE OR CONSTRUCTION OF THE NEW ASSET TOGETHER WITH THE AMOUNT SO DEPOSITED SHALL BE DEEMED TO BE THE COST OF THE NEW ASSET : PROVIDED THAT IF THE AMOUNT DEPOSITED UNDER THIS SUB-SECTION IS NOT UTILIZED WHOLLY OR PARTLY FOR TH E PURCHASE OR CONSTRUCTION OF THE NEW ASSET WITHIN TH E PERIOD SPECIFIED IN SUB-SECTION (1) THEN (I) THE AMOUNT BY WHICH (A) THE AMOUNT OF CAPITAL GAIN ARISING FROM THE TRA NSFER OF THE ORIGINAL ASSET NOT CHARGED UNDER SECTION 45 ON THE BASIS OF THE COST OF THE NEW ASSET AS PROVIDED IN C LAUSE (A) OR AS THE CASE MAY BE CLAUSE (B) OF SUB-SECTI ON (1) EXCEEDS (B) THE AMOUNT THAT WOULD NOT HAVE BEEN SO CHARGED HAD THE AMOUNT ACTUALLY UTILIZED BY THE ASSESSEE FO R THE PURCHASE OR CONSTRUCTION OF THE NEW ASSET WITHIN TH E ITA NO.598/IND/16 AY : 09-10 PANKAJ BAFNA INDORE. PAGE 10 OF 16 PERIOD SPECIFIED IN SUB-SECTION (1) BEEN THE COST O F THE NEW ASSET SHALL BE CHARGED UNDER SECTION 45 AS INCO ME OF THE PREVIOUS YEAR IN WHICH THE PERIOD OF THREE Y EARS FROM THE DATE OF THE TRANSFER OF THE ORIGINAL ASSET EXPIRES ; AND (II) THE ASSESSEE SHALL BE ENTITLED TO WITHDRAW THE UNUTILIZED AMOUNT IN ACCORDANCE WITH THE SCHEME AFORESAID. 9. THE PERUSAL OF ABOVE SECTION MANDATES THAT UNUTILIZ ED AMOUNT OF NET CONSIDERATION MUST BE DEPOSITED IN NO TIFIED CAPITAL GAIN SCHEME ACCOUNT NOT LATER THAN DUE DATE AND RETURN AS APPLICABLE U/S 139(1) OF THE ACT. 10. THE LD. AUTHORIZED REPRESENTATIVE OF THE ASSESSEE RELIED IN THE CASE OF CIT VS. K.RAMACHANDRA RAO 23 0 TAXMAN 334 (KAR) TO CONTEND THAT THE ASSESSEE IS ELIGIBLE FOR THE DEDUCTION U/S 54F. HOWEVER THE FACTS OF THE SAID CASE ARE DISTINGUISHABLE AS IN THE SAID CASE THE HON'BLE H IGH COURT HAS HELD THAT IF THE ASSESSEE WANTS THE BENEFIT OF S ECTION 54-F THEN HE SHOULD DEPOSIT THE SAID CAPITAL GAINS IN AN ACCOUNT ITA NO.598/IND/16 AY : 09-10 PANKAJ BAFNA INDORE. PAGE 11 OF 16 WHICH IS DULY NOTIFIED BY THE CENTRAL GOVERNMENT. IN OTHER WORDS IF HE WANTS TO CLAIM EXEMPTION FROM PAYMENT OF INCOME TAX BY RETAINING THE TAX THEN THE SAID AMOUNT IS T O BE INVESTED IN THE SAID ACCOUNT. IF THE INTENTION IS NOT TO RET AIN CASH BUT TO INVEST IN CONSTRUCTION FOR ANY PURCHASE OF THE PROP ERTY AND IF SUCH INVESTMENT IS MADE WITHIN THE PERIOD STIPULATED THEREIN THEN SECTION 54-F IS NOT ATTRACTED. IN THE PRESENT CASE WE FIND THAT THE INTENTION OF THE ASSESSEE WAS NOT TO INVEST IN CONSTRUCTION OR PURCHASE OF ANY PROPERTY AS COULD B E SEEN FROM THE RETURN OF INCOME THAT THE ASSESSEE HIMSELF HAS OFFERED CAPITAL GAIN AT RS. 2 57 696/- FOR TAXATION IN HIS RETURN OF INCOME FILED ON 27.09.2009. THUS THERE WAS NO IN TENTION OF THE ASSESSEE TO MAKE INVESTMENT OR PURCHASE NEW PROP ERTY BUT THE INTENTION WAS TO RETAIN THE CASH AND THEREF ORE THE ASSESSEE WAS REQUIRED TO DEPOSIT THE SAID CASH IN TH E SPECIFIED BANK ACCOUNT IN ORDER TO CLAIM THE BENEFIT OF SECTI ON 54F OF THE ACT. WE FURTHER RELY IN THE CASE OF HUMAYUN SUL EMAN MERCHANT VS. CIT (2016) STIOL-1949-S.C.MUM-I.T. WH EREIN THE HON'BLE MUMBAI HIGH COURT HAS HELD THAT THE PRO VISIONS OF SECTION 54F(4) OF THE ACT ARE VERY CLEAR. THERE IS NO ITA NO.598/IND/16 AY : 09-10 PANKAJ BAFNA INDORE. PAGE 12 OF 16 AMBIGUITY. THUS THERE IS NO OCCASION TO APPLY LIBERAL/BENEFICIAL CONSTRUCTION WHILE INTERPRETING T HE SECTION WHETHER EXEMPTION U/S 54F(1) IS AVAILABLE WHERE THE CONSIDERATION RECEIVED ON SALE OF CAPITAL ASSETS IS NOT APPROPRIATED WHERE PURCHASE WAS EARLIER THAN SALE OR UTILIZED WHERE PURCHASE IS AFTER THE SALE AND NEITHER THE UN- UTILIZED AMOUNT WERE DEPOSITED IN THE SPECIFIED BANK ACCOUNT AS NOTIFIED IN TERMS OF SECTION 54F DEDUCTION IS NOT A VAILABLE. THE FACTS OF THAT CASE ARE REPRODUCED AS UNDER :- THE SALE OF CAPITAL ASSETS TOOK PLACE ON 29 TH APRIL 1995 FOR A CONSIDERATION OF RS. 85.33 LAKHS. THE AGREEMENT FOR PURCHASE ON CONSTRUCTION OF FLAT FOR CONSIDERATION OF RS. 69.90 LAKHS WAS ENTERED INTO B Y THE ASSESSEE ON 16 TH JULY 1996. AN AMOUNT OF RS. 35 LAKHS WAS UTILIZED BY THE ASSESSEE IN PURCHASE OF FLAT BEFORE THE RETURN OF INCOME WAS FILED ON 4 TH NOVEMBER 1996 U/S 139 OF THE ACT. HOWEVER THE MANDATE UNDER SUB SECTION (4) OF SECTION 54-F OF TH E ACT IS THAT THE AMOUNT NOT UTILIZED FOR THE PURCHAS E OF THE FLAT HAS TO BE DEPOSITED BEFORE THE DUE DATE OF ITA NO.598/IND/16 AY : 09-10 PANKAJ BAFNA INDORE. PAGE 13 OF 16 FILING OF RETURN OF INCOME U/S 139(1) OF THE ACT IN THE SPECIFIED BANK ACCOUNT. IN THIS CASE ADMITTEDLY T HE ENTIRE AMOUNT OF THE CAPITAL GAIN IN SALE OF ASSETS WHICH IS NOT UTILIZED HAS NOT BEEN DEPOSITED IN A SPECIFIED BANK ACCOUNT BEFORE DUE DATE OF FILING OF RETURN U/S 139(1) OF THE ACT. THEREFORE WHERE THE AMOUNT OF CAPITAL GAINS IS UTILIZED BEFORE FILING O F THE RETURN OF INCOME IN PURCHASE/CONSTRUCTION OF RESIDENTIAL HOUSE THEN THE BENEFIT OF EXEMPTION U/ S 54 OF THE ACT IS AVAILABLE EXCEPT RS. 35 LAKHS THE BALANCE OF THE AMOUNT SUBJECT TO CAPITAL GAINS TAX HAS NOT BEEN UTILIZED BEFORE DATE OF FURNISHING OF RETURN OF INCOME I.E. 4 TH NOVEMBER 1996 U/S 139(1) OF THE ACT. THEREFORE ON PLAIN INTERPRETATION OF SECTION 54 OF THE ACT IT APPEARS THAT THE IMPUGNED ORDER OF THE INCOME-TAX ACT 1961. CANNOT BE FAULTED.. . THE PROVISIONS OF SECTION 54F(4) OF T HE ACT ARE VERY CLEAR. THERE IS NO AMBIGUITY. THUS TH ERE IS NO OCCASION TO APPLY LIBERAL/BENEFICIAL CONSTRUC TION ITA NO.598/IND/16 AY : 09-10 PANKAJ BAFNA INDORE. PAGE 14 OF 16 WHILE INTERPRETING THE SECTION AS CONTENDED BY THE ASSESSEE. 11. IN THE LIGHT OF THE ABOVE FINDINGS OF THE HON'BLE MUMBAI HIGH COURT WE FIND THAT THE ASSESSEE HAS FAI LED TO DEPOSIT THE NET SALE CONSIDERATION ARISING ON SALE OF ORIGINAL ASSET IN THE SPECIFIED BANK ACCOUNT THEREFORE THE FACTS OF ABOVE CASE ARE SQUARELY COVERED. FURTHER THE DECIS ION IN SUBSEQUENT DECISION OF HON'BLE KARNATAKA HIGH COURT ; THEREFORE WE ARE RESPECTFULLY FOLLOWING THE SAME AN D WE ARE INCLINED TO ACCEPT THE FINDINGS OF LOWER AUTHORITIE S. ACCORDINGLY THE ORDER OF THE CIT(A) IS UPHELD. THI S GROUND OF APPEAL IS DISMISSED. CONSEQUENTLY THE PROVISIONS O F SECTION 50C WOULD BE APPLICABLE. ACCORDINGLY THE FINDINGS OF THE LOWER AUTHORITIES ARE UPHELD. IN VIEW OF THE ABOVE DISCUSS ION THE GROUND NOS. 1 & 2 OF THE ASSESSEES APPEALS ARE DIS MISSED. 12. GROUND NO. 3 RELATES TO DISALLOWANCE OF RS. 20 00 0/- OUT OF EXPENSES CLAIMED FOR PHONE VEHICLE MAINTENA NCE AND TRAVELLING. 13. WE HAVE HEARD THE RIVAL SUBMISSIONS AND WE ARE OF T HE VIEW THAT THE DISALLOWANCES ARE RIGHTLY MADE ON ACCO UNT OF ITA NO.598/IND/16 AY : 09-10 PANKAJ BAFNA INDORE. PAGE 15 OF 16 ELEMENT OF PERSONAL USE IN RESPECT OF VEHICLE TRAV ELLING AND PHONES. THEREFORE THIS GROUND OF APPEAL IS DISMISS ED. 14. IN THE RESULT THE APPEAL OF THE ASSESSEE IS DISMISS ED. THE ORDER HAS BEEN PRONOUNCED IN OPEN COURT ON THE 28 TH SEPTEMBER 2016. SD/- (..) (D.T.GARASIA) JUDICIAL MEMBER SD/- (..) (O.P.MEENA) ACCOUNTANT MEMBER * / DATED : 28 TH SEPTEMBER 2016. CPU* COPY OF THE ORDER FORWARDED TO : THE ASSESSEE/ PCIT- INDORE/ CIT(A)-I INDORE AO/ D R- INDORE BENCH/ GUARD FILE BY ORDER ASSISTANT REGISTRAR OF ITAT INDORE BENCH ITA NO.598/IND/16 AY : 09-10 PANKAJ BAFNA INDORE. PAGE 16 OF 16