ACIT, Coimbatore v. R.Elangovan, Coimbatore

ITA 878/CHNY/2016 | 2012-2013
Pronouncement Date: 26-10-2016

Appeal Details

RSA Number 87821714 RSA 2016
Assessee PAN AADPE1841Q
Bench Chennai
Appeal Number ITA 878/CHNY/2016
Duration Of Justice 6 month(s) 20 day(s)
Appellant ACIT, Coimbatore
Respondent R.Elangovan, Coimbatore
Appeal Type Income Tax Appeal
Pronouncement Date 26-10-2016
Appeal Filed By Department
Bench Allotted A
Assessment Year 2012-2013
Appeal Filed On 06-04-2016
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : CHENNAI . . . . . ' #$ % &' ( [ BEFORE SHRI N.R.S. GANESAN JUDICIAL MEMBER AND SHRI D. S. SUNDER SINGH ACCOUNTANT MEMBER ] ./ I.T.A.NO.878/MDS/2016 / ASSESSMENT YEAR : 2012-13 THE ASSTT. COMMISSIONER OF INCOME-TAX CENTRAL CIRCLE I COIMBATORE VS. SHRI R.ELANGOVAN NO.821/2 KALLIPALAYAM CHIKKARAMPALAYAM POST KARAMADAI COIMBATORE 641104 [PAN AADPE 1841 Q ] ( )* / APPELLANT) ( + )* /RESPONDENT) / APPELLANT BY : SHRI SHIVA SRINIVAS JCIT /RESPONDENT BY : SHRI M. NARAYANAN RETD.ACIT / DATE OF HEARING : 28 - 09 - 2016 ! / DATE OF PRONOUNCEMENT : 26 - 10 - 2016 / O R D E R PER D.S. SUNDER SINGH ACCOUNTANT MEMBER THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-18 CHENN AI DATED 16.11.2015 FOR ASSESSMENT YEAR 2012-13. 2. ALL THE GROUNDS OF APPEAL ARE RELATED TO THE DELET ION OF ADDITION OF ` 7.02 CRORES MADE BY THE ASSESSING OFFICER U/S 69B OF THE INCOME-TAX ACT 1961. ITA NO. 878/16 :- 2 -: 3. A SEARCH U/S 132 OF THE ACT WAS CARRIED OUT IN THE ASSESSEES CASE ON 14.12.2012 AND DURING THE COURSE OF SEARCH OPERATION IT WAS FOUND THAT THE ASSESSEE HAS PURCH ASED M/S PSP STEELS(P) LTD KARAIKAL FOR A CONSIDERATION OF ` 22 CRORES. DURING THE COURSE OF SEARCH THE ASSESSEE WAS ASKED TO EXPLAIN THE SOURCE OF THE PAYMENT OF ` 22 CRORES FOR ACQUIRING M/S PSP STEELS(P) LTD. TH E ASSESSEE EXPLAINED THAT HIS COMPANY M/S SASTHA STE ELS (P) LTD HAD PURCHASED M/S PSP STEELS(P) LTD FOR ` 22.00 CRORES. THE PURCHASE WAS INCLUDED THE LAND BUILDING AND MACHINERIES BELONGI NG TO M/S PSP STEELS(P) LTD AND LAND MEASURING 2.42 ACRES BELONG ING TO SMT P.DHANALAKSHMI LOCATED ADJACENT TO THE STEEL UNIT. THE REGISTERED VALUE OF THE LAND AND BUILDING OF M/S M/S PSP STEE LS(P) LTD WAS ` .2.5 CRORES AND THE VALUE OF LAND PURCHASED FROM SMT P. DHANALAKSHMI WAS ` 98.00 LACS WHICH ACCORDING TO HIM WAS ACCOUNTED FOR IN THE BOOKS OF ACCOUNTS OF M/S SASTHA STEELS (P) LTD FOR ` 14.98 CRORES. SHRI ELANGOVAN IN HIS STATEMENT RECORDED ON 14/12/2014 A DMITTED THAT ` 7.02 CRORES WAS UNACCOUNTED INVESTMENT IN THE PURCH ASE OF M/S . PSP STEELS(P) LTD HOWEVER DURING THE COURSE OF ASSESSM ENT PROCEEDINGS THE ASSESSEE EXPLAINED THAT M/S PSP STEELS(P) LTD WAS PURCHASED FOR A CONSIDERATION OF ` 22 CRORES AND THE AMOUNT OF ` 19 CRORES WAS PAID BY CHEQUES AND ` 3 CRORES BY CASH. THE ASSESSING OFFICER MADE ITA NO. 878/16 :- 3 -: ADDITION OF ` 7.02 CRORES AS DEEMED INCOME U/S 69B OF THE ACT A S PER DISCUSSION MADE IN THE ASSESSMENT ORDER IN PARA 6.8 .4 AS UNDER: THE ASSESSEES EXPLANATION ON THIS ISSUE IS MERE REPETITION OF THE ANSWER GIVEN IN THE STATEMENT BEFORE THE INVEST IGATION TEAM. IT IS RELEVANT THAT THE ASSESSEE HAS AFTER THE INI TIAL DECLARATION OF ` 3 CRORES RECONCILED THE ACCOUNTS APPRECIATED THE FACTS AND REVISED THE DECLARATION IN RESPECT OF THE EXCESS MO NEY PAID FOR THE PURCHASE OF PSP LTD AS ` 7.02 CRORES (22 CRORES 14.98 CRORES). THE ASSESSEES RETRACTION OF HIS STATEME NT IS WITHOUT CORROBORATIVE EVIDENCE AND GIVEN AFTER CONSIDERABLE LAPSE OF TIME. HENCE THE AMOUNT OF ` 7.02 CRORES IS ASSESSED AS DEEMED INCOME FOR THE AY 2012-13 U/S 69(B) OF THE IT ACT. SINCE THE INVESTMENT WAS MADE IN THE F.Y 2011-12. 4. AGGRIEVED THE ASSESSEE WENT ON APPEAL BEFORE THE CIT(A) AND THE CIT(A) HAS DELETED THE ADDITION HOLDING THA T OUT OF THE TOTAL PAYMENT OF ` 22 CRORES THE ASSESSEE HAS MADE THE PAYMENT OF ` 19.19 CRORES THROUGH BANKING CHANNELS AND ` 3 CRORES WAS PAID TO SMT. DHANALAKSHMI. THE SOURCE WAS EXPLAINED BY THE ASSESSEE HENCE THERE WAS NO UNACCOUNTED PAYMENT FOR WHICH T HE SOURCE COULD NOT BE EXPLAINED BY THE ASSESSEE. 5. AGGRIEVED BY THE ORDER OF THE CIT(A) THE REVENUE I S IN APPEAL BEFORE US. DURING THE APPEAL THE LD. DR AR GUED THAT THE ASSESSEE HAS MADE PAYMENT OF ` 22 CRORES FOR PURCHASE OF M/S PSP STEELS(P) LTD AND ADMITTED THAT ` 14.98 CRORES WAS ACCOUNTED IN THE BOOKS OF ACCOUNTS AND THE REMAINING AMOUNT WAS UNA CCOUNTED. FURTHER THE LD. DR ARGUED THAT THE AMOUNT OF ` 3 CRORES WAS PAID IN ITA NO. 878/16 :- 4 -: CASH BY THE ASSESSEE WHICH WAS ADMITTED AS ADDITI ONAL INCOME IN THE STATEMENT RECORDED U/S 132(4) OF THE ACT. THEREFOR E THE LD. DR IS OF THE OPINION THAT THE ADDITION MADE BY THE ASSESSING OFFICER BE CONFIRMED. 6. ON THE OTHER HAND THE LD. AR RELIED ON THE CIT(A) S ORDER AND FILED A PAPER BOOK WITH STATEMENT OF AFFAIRS AN D EXTRACTS OF CASH BOOK. THE LD. AR EXPLAINED THAT THE ASSESSEE HAS PURCHASED M/S PSP STEELS(P) LTD FOR A CONSIDERATION OF ` 22 CRORES OUT OF WHICH ` 19.48 CRORES WAS PAID BY THE CHEQUE THROUGH BANKING CHAN NELS. THE REMAINING ` 3 CRORES WAS PAID FROM OWN SAVINGS OF THE ASSESSE E ON VARIOUS DATES. THE ASSESSEE FURNISHED CASH BOOK ENTRIES WITH THE RELEVANT DATES OF PAYMENTS MADE TO SMT. DHANALAKS HMI AND ARGUED THAT THE SOURCES FOR THE ENTIRE PAYMENT MADE FOR P URCHASE OF PSP STEELS(P) LTD WAS EXPLAINED AND THERE IS NO CASE FO R MAKING ANY ADDITION AS UNEXPLAINED INCOME. 7. WE HEARD THE RIVAL SUBMISSIONS AND THE MATERIAL PLA CED BEFORE US. IT IS AN ADMITTED FACT THAT THE ASSESS EE HAS PURCHASED M/S PSP STEELS(P) LTD FOR A SUM OF ` 22 CRORES AND ` 19 CRORES WAS PAID THROUGH BANKING CHANNEL WHICH WAS NOT DISPUTED BY T HE DEPARTMENT. THE DETAILS OF THE PAYMENTS MADE WERE FURNISHED BY THE ASSESSEE BEFORE THE CIT(A) AS WELL AS BEFORE US IN THE STAT EMENT OF AFFAIRS. ITA NO. 878/16 :- 5 -: THIS FACT WAS NOT DISPUTED BY THE DEPARTMENT. T HE REMAINING AMOUNT OF ` 3 CRORES WAS PAID BY THE ASSESSEE FROM HIS OWN SO URCE FOR WHICH FACT FINDING WAS GIVEN BY THE CIT(A). DURING THE APPEAL THE LD. AR FURNISHED THE DATE WISE PAYMENT IN THE P APER BOOK AND THE SAME WAS NOT CONTROVERTED BY THE LD. DR. THEREFO RE WE DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE CIT(A ) AND THE SAME IS CONFIRMED. 8. IN THE RESULT THE APPEAL OF THE REVENUE IS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT ON 26 TH OCTOBER 2016 AT CHENNAI. SD/- SD/- ( . . . ' ) (N.R.S. GANESAN) / JUDICIAL MEMBER ( . . ' #$ ) (D.S. SUNDER SINGH) % / ACCOUNTANT MEMBER #$ / CHENNAI %& / DATED: 26 TH OCTOBER 2016 RD &' ()*) / COPY TO: 1 . / APPELLANT 4. + / CIT 2. / RESPONDENT 5. ) - . / DR 3. +/' / CIT(A) 6. -01 / GF