Inder Kumar Bhargav, Delhi v. ITO, New Delhi

ITA 80/DEL/2015 | 2011-2012
Pronouncement Date: 25-10-2016 | Result: Partly Allowed

Appeal Details

RSA Number 8020114 RSA 2015
Assessee PAN AAGPB2557F
Bench Delhi
Appeal Number ITA 80/DEL/2015
Duration Of Justice 1 year(s) 9 month(s) 19 day(s)
Appellant Inder Kumar Bhargav, Delhi
Respondent ITO, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 25-10-2016
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted SMC 2
Tribunal Order Date 25-10-2016
Date Of Final Hearing 25-10-2016
Next Hearing Date 25-10-2016
Assessment Year 2011-2012
Appeal Filed On 06-01-2015
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : SMC-II : NEW DELHI BEFORE SHRI R.S. SYAL ACCOUNTANT MEMBER ITA NO.80/DEL/2015 ASSESSMENT YEAR : 2011-12 INDER KUMAR BHARGAV D-109 VIVEK VIHAR DELHI. PAN: AAGPB2557F VS. ITO WARD-2(4) CR BUILDING NEW DELHI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI K. SAMPATH ADVOCATE & SHRI V. RAJA KUMAR DEPARTMENT BY : SHRI F.R. MEENA SR. DR DATE OF HEARING : 25.10.2016 DATE OF PRONOUNCEMENT : 25.10.2016 ORDER THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER PASSED BY THE CIT(A) ON 22.10.2014 IN RELATION TO THE ASSE SSMENT YEAR 2011-12. 2. THE FIRST ISSUE ARGUED BY THE LD. AR IS AGAINST THE CONFIRMATION OF ADDITION OF RS.2 77 200/- ON ACCOUNT OF DEEMED RENT AL INCOME. ITA NO.80/DEL/2015 2 3. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT T HE ASSESSEE WAS THE OWNER OF THE FOLLOWING THREE PROPERTIES:- 1. FLAT NO.GF PLOT NO.229 SHALIMAR GARDEN EXTN. 1 PASONDA GHAZIABAD. 2. FLAT NO.F1 & S1 AT A-1/24 DLF BHOPURA. 3. FLAT NO.F-1 F-2 S1 S2 B-1/6 ANKUR VIHAR D LF LONI GHAZIABAD. 4. THE ASSESSEE DECLARED RENTAL INCOME ONLY IN RESP ECT OF ONE PROPERTY I.E. RENT FROM MOBILE TOWER INSTALLED AT ROOF OF B -1/6 ANKUR VIHAR DLF LONI GHAZIABAD. AN INSPECTOR WAS DEPUTED FOR CONDU CTING INQUIRIES REGARDING THE STATUS OF OTHER PROPERTIES. THE INSP ECTOR SUBMITTED A REPORT INDICATING THE RENTAL INCOME AT PARTICULAR LEVELS. WHEN CONFRONTED THE ASSESSEE ADMITTED THAT THESE PROPERTIES WERE OWNED BY HIM. HOWEVER IT WAS ARGUED THAT THE QUANTUM OF RENT WAS ON HIGHER S IDE. NOT CONVINCED WITH THE ASSESSEES SUBMISSIONS THE AO COMPUTED I NCOME FROM THE PROPERTY AT RS.2 77 200/- AFTER ALLOWING STATUTORY DEDUCTION TO THE EXTENT OF 30% FROM THE GROSS RENT OF RS.3 96 000/- AS IND ICATED BY THE INSPECTOR. THIS LED TO THE ADDITION OF RS.2 77 200/- WHICH C AME TO BE CONFIRMED IN THE FIRST APPEAL. ITA NO.80/DEL/2015 3 5. AFTER CONSIDERING THE RIVAL SUBMISSIONS AND PERU SING THE RELEVANT MATERIAL ON RECORD IT IS INDISPUTABLY FOUND THAT T HE ASSESSEE ADMITTED TO BE THE OWNER OF THREE PROPERTIES DISCUSSED BY THE AO I N THE ASSESSMENT ORDER. THE LD. AR CONTENDED THAT MUNICIPAL VALUE OF THE PR OPERTY SHOULD HAVE BEEN TAKEN INTO CONSIDERATION WHILE DETERMINING THE ANNUAL LETTING VALUE OF THE PROPERTY U/S 23 OF THE ACT. ON A SPECIFIC Q UERY THE LD. AR COULD NOT DRAW MY ATTENTION TOWARDS ANY MATERIAL INDICATI NG THAT THESE PROPERTIES WERE NOT LET OUT OR THE ASSESSEE DID NOT RECEIVE ANY RENT FROM SUCH PROPERTIES. THERE IS NO DISCUSSION IN THE ASS ESSMENT ORDER OR THE IMPUGNED ORDER ON THIS VITAL ASPECT WHICH IS SIGNI FICANT FOR DETERMINING THE ALV OF THE PROPERTIES U/S 23 OF THE ACT. UNDER THESE CIRCUMSTANCES I SET ASIDE THE IMPUGNED ORDER AND REMIT THE MATTER T O THE FILE OF AO WITH A DIRECTION TO DETERMINE THE ALV OF THESE PROPERTIES AS PER LAW AFTER ALLOWING AN OPPORTUNITY OF HEARING TO THE ASSESSEE. 6. THE ONLY OTHER ISSUE PRESSED BY THE LD. AR IS AG AINST THE ADDITION OF RS.14 51 856/- ON ACCOUNT OF DEEMED DIVIDEND U/S 2( 22)(E) OF THE ACT. THE FACTS OF THIS GROUND ARE THAT THE ASSESSEE IS A DIRECTOR IN M/S BHARGAV PROMOTERS (P) LTD. AND ALSO HELD SHARE CAPITAL OF M ORE THAN 10% IN M/S ITA NO.80/DEL/2015 4 BHARGAV BUILDTECH (P) LTD. ON A PERUSAL OF THE COPY OF ACCOUNT OF THE ASSESSEE IN THE BOOKS OF THE COMPANY IT WAS NOTICE D THAT THE COMPANYS MONEY WAS LYING IN THE ASSESSEES ACCOUNT. TOTAL O F SUCH CREDIT ENTRIES WAS WORKED OUT AT RS.14 51 816/-. SINCE THE ACCUMU LATED PROFITS OF THE COMPANY WERE MORE THAN THIS AMOUNT THE AO CALLED U PON THE ASSESSEE AS TO WHY THE ADDITION BE NOT MADE BY TREATING THIS AM OUNT AS DEEMED DIVIDEND U/S 2(22)(E) OF THE ACT. IN REPLY THE AS SESSEE SUBMITTED THAT HE ACCEPTED MONEY FROM THE COMPANY UNDER CURRENT ACCOU NT WHICH WAS SQUARED UP AT THE CLOSE OF THE FINANCIAL YEAR. IT W AS FURTHER SUBMITTED THAT THE ASSESSEE DID NOT RECEIVE ANY PAYMENT IN THE NAT URE OF LOAN OR ADVANCE. NOT CONVINCED THE AO MADE ADDITION OF RS.14 51 816 /- WHICH WAS ECHOED IN THE FIRST APPEAL. 7. HAVING HEARD BOTH THE SIDES AND PERUSED THE RELE VANT MATERIAL ON RECORD IT IS NOTICED THAT THE ASSESSEE HAS MADE OU T A CASE THAT THE SAID AMOUNT OF RS.14.51 LAC WAS RECEIVED BY HIM ON CURRE NT ACCOUNT FOR DEFRAYING THE EXPENSES OF THE COMPANY AND NOT AS A LOAN OR ADVANCE FOR PERSONAL USE. ON A SPECIFIC QUERY THE LD. AR COULD NOT PRODUCE A COPY OF ACCOUNT OF THE ASSESSEE IN THE BOOKS OF THE COMPANY . ONLY WHEN THE COPY ITA NO.80/DEL/2015 5 OF ACCOUNT IS AVAILABLE THAT ONE CAN APPRECIATE THE CONTENTION ABOUT THE AMOUNT AS OBTAINED ON CURRENT ACCOUNT OR AS LOAN OR ADVANCE. SINCE THIS SIGNIFICANT INFORMATION IS NOT AVAILABLE ON RECORD I CONSIDER IT EXPEDIENT TO SET ASIDE THE IMPUGNED ORDER AND RESTORE THE MAT TER TO THE FILE OF AO FOR DECIDING THIS ISSUE AFRESH AFTER CONSIDERING THE N ATURE OF AMOUNT RECEIVED BY THE ASSESSEE. IF IT IS SIMPLY A BALANCE IN THE CURRENT ACCOUNT NAMELY THE ASSESSEE WAS SPENDING MONEY ON BEHALF OF THE CO MPANY THEN NO ADDITION IS CALLED FOR. IF HOWEVER SUCH AMOUNT I S FOUND TO HAVE BEEN RECEIVED AS A LOAN OR ADVANCE FROM THE COMPANY EVE N IF SQUARED UP AT THE END OF THE YEAR IT WOULD BE A CASE CALLING FOR DIS ALLOWANCE U/S 2(22)(E) OF THE ACT. NEEDLESS TO SAY THE ASSESSEE WILL BE GIV EN AN OPPORTUNITY OF BEING HEARD. 8. THE OTHER DISALLOWANCE OF RS.22 497/- ON ACCOUNT OF INTEREST WAS NOT PRESSED BY THE LD. AR WHICH IS HEREBY DISMISSED. ITA NO.80/DEL/2015 6 9. IN THE RESULT THE APPEAL IS PARTLY ALLOWE D FOR STATISTICAL PURPOSES. THE ORDER PRONOUNCED IN THE OPEN COURT ON 25.10.20 16. SD/- [R.S. SYAL] ACCOUNTANT MEMBER DATED 25 TH OCTOBER 2016. DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR ITAT AR ITAT NEW DELHI.