Anilkumar R. Agarwal, Ahmedabad v. The Income tax Officer, Ahmedabad

ITA 829/AHD/2014 | 2010-2011
Pronouncement Date: 29-09-2016 | Result: Partly Allowed

Appeal Details

RSA Number 82920514 RSA 2014
Assessee PAN ADYPA6685J
Bench Ahmedabad
Appeal Number ITA 829/AHD/2014
Duration Of Justice 2 year(s) 6 month(s) 8 day(s)
Appellant Anilkumar R. Agarwal, Ahmedabad
Respondent The Income tax Officer, Ahmedabad
Appeal Type Income Tax Appeal
Pronouncement Date 29-09-2016
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted C
Tribunal Order Date 29-09-2016
Date Of Final Hearing 26-09-2016
Next Hearing Date 26-09-2016
Assessment Year 2010-2011
Appeal Filed On 21-03-2014
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH (BEFORE SHRI N.K. BILLAIYA ACCOUNTANT MEMBER & SHRI MAHAVIR PRASAD JUDICIAL MEMBER) ITA. NO: 829/AHD/2014 (ASSESSMENT YEAR: 2010-11) SHRI ANIL KUMAR R. AGARWAL 311 VANIJYA BHAVAN DIWAN BALLUBHAI SCHOOL KANKARIA AHMEDABAD-380022 V/S INCOME TAX OFFICER WARD- 9 (4) AHMEDABAD (APPELLANT) (RESPONDENT) PAN: ADYPA6685J APPELLANT BY : SHRI PRADEEP G. TULSIAN A.R. RESPONDENT BY : SHRI PRASOON KABRA SR. D.R. ( )/ ORDER DATE OF HEARING : 28-09-2016 DATE OF PRONOUNCEMENT : 29 -09-2016 PER N.K. BILLAIYA ACCOUNTANT MEMBER: 1. WITH THIS APPEAL THE ASSESSEE HAS CHALLENGED THE C ORRECTNESS OF THE ORDER OF THE LD. CIT(A)-II AHMEDABAD DATED 27.01.2 014 PERTAINING TO A.Y. 2010-11. ITA NO. 829/ AHD/2014 . A.Y. 2010-11 2 2. THE GRIEVANCE OF THE ASSESSEE IS TWOFOLD. FIRSTLY THE ASSESSEE IS AGGRIEVED BY THE ADDITION OF RS. 1 40 839/- MADE ON ACCOUNT OF INTEREST PAYMENT AND SECONDLY THE ASSESSEE IS AGGR IEVED BY THE DENIAL OF THE CREDIT OF TDS OF RS. 32 442/-. 3. THE ASSESSEE IS IN THE BUSINESS OF TRANSPORTATION. THE RETURN FOR THE YEAR WAS SELECTED FOR SCRUTINY ASSESSMENT AND ACCOR DINGLY STATUTORY NOTICES WERE ISSUED AND SERVED UPON THE ASSESSEE. 4. WHILE SCRUTINIZING THE RETURN OF INCOME THE A.O. N OTICED THAT THE ASSESSEE HAS GIVEN INTEREST OF RS. 1 40 839/- TO VA RIOUS PARTIES AND ON THE OTHER HAND THE ASSESSEE HAS ADVANCED INTEREST F REE LOAN TO THE HUF OF THE ASSESSEE AND ONE RITU AGARWAL. THE ASSE SSEE WAS ASKED TO SHOW CAUSE WHY THE INTEREST PAYMENT OF RS. 1 40 839 /- SHOULD NOT BE DISALLOWED AS THE ASSESSEE HAS NOT CHARGED ANY INTE REST ON THE LOANS AND ADVANCES MADE TO THE HUF AND RITU AGARWAL. 5. THE ASSESSEE FILED A DETAILED REPLY EXPLAINING THE PAYMENT OF INTEREST OF RS. 1 40 839/- AND THE SAME CAN BE UNDERSTOOD BY THE FOLLOWING CHART:- NAME OF PARTY PURPOSE OF LOAN LOAN OBTAINED ON I NTEREST PAID KOTAK MAHINDRA BANK LTD. BUSINESS PURPOSE 15.01.2008 75029 HDFC BANK LTD. BUSINESS PURPOSE 18.12.2007 41712/ - LIC BUSINESS PURPOSE PRIOR TO 01.04.2007 13598 JAGATNARAYAN KOTHARI BUSINESS PURPOSE 06.02.2009 10500 TOTAL 140839 ITA NO. 829/ AHD/2014 . A.Y. 2010-11 3 6. IT WAS EXPLAINED THAT THE IMPUGNED ADVANCES WERE GI VEN BY THE ASSESSEE PRIOR TO THE AFOREMENTIONED LOANS TAKEN BY HIM. THE ASSESSEE STRONGLY OBJECTED FOR THE PROPOSED DISALLO WANCE OF INTEREST. THE EXPLANATION OF THE ASSESSEE DID NOT FIND FAVOUR WITH THE A.O. WHO WAS OF THE FIRM BELIEF THAT THE ASSESSEE HAS UTILIZ ED THE INTEREST BEARING LOAN FOR MAKING ADVANCES TO HIS FAMILY MEMB ERS. THE A.O. ACCORDINGLY DISALLOWED RS. 1 40 839/-. 7. ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) B UT WITHOUT ANY SUCCESS. 8. BEFORE US THE LD. COUNSEL FOR THE ASSESSEE REITERA TED WHAT HAS BEEN STATED BEFORE THE LOWER AUTHORITIES. 9. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE ORD ERS OF THE AUTHORITIES BELOW AND THE RELEVANT DOCUMENTARY EVID ENCES BROUGHT ON RECORD. WE FIND THAT RS. 16 97 492/- WAS ADVANCED T O ANIL AGARWAL HUF DURING THE FINANCIAL YEAR 2007-08 AND RS. 15 04 550/- WAS ADVANCED TO RITU AGARWAL IN THE SAME FINANCIAL YEAR 2007-08. A COMPARISON OF THESE ADVANCES WITH THE BORROWINGS AS MENTIONED ELSEWHERE CLEARLY SHOWS THAT THE ADVANCES WERE MADE MUCH EARLIER THAN THE LOANS BORROWED. THIS PROVES THAT THE LOANS WERE NOT BORROWED FOR MAKING INTEREST FREE ADVANCES. FURTHER SINCE T HESE ADVANCES/BORROWINGS ARE BROUGHT FORWARD BALANCES FR OM EARLIER YEARS AND NO SUCH DISALLOWANCE HAS BEEN MADE IN EARLIER Y EARS. THEREFORE WE DO NOT FIND ANY REASON FOR MAKING THE IMPUGNED D ISALLOWANCE FOR THE YEAR UNDER CONSIDERATION. WE ACCORDINGLY SET ASIDE THE FINDINGS OF THE LD. CIT(A) AND DIRECT THE A.O. TO DELETE THE AD DITION OF RS. 1 40 839/-. ITA NO. 829/ AHD/2014 . A.Y. 2010-11 4 10. COMING TO THE SECOND GRIEVANCE OF THE ASSESSEE REL ATING TO THE DENIAL OF CREDIT OF TDS. WE FIND THAT THE LD. CIT(A ) HAS DIRECTED THE A.O. TO EXAMINE THE CLAIM OF THE ASSESSEE AND ALLOW THE SAME AFTER VERIFICATION. DIRECTIONS OF THE LD. CIT(A) ARE VERY SPECIFIC THEREFORE CALLS FOR NO INTERFERENCE. 11. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 29 - 09- 201 6. SD/- SD/- (MAHAVIR PRASAD) (N. K. BILLAIYA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD: TRUE COPY RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR. ITAT AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT AHME DABAD