Income Tax Appellate Tribunal - Delhi
Smt. Sunita Chopra, Saharanpur vs Acit, Saharanpur on 1 August, 2017
1 ITA No.3918/Del/2010
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH: 'G' NEW DELHI
BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBER
AND
MS SUCHITRA KAMBLE, JUDICIAL MEMBER
I.T.A .No.5121/DEL/2012 (A.Y 2009-10)
Sunita Chopra Vs ACIT
C/o. M/s. Sanjay & Sanjay, CA Circle Saharanpur,
15, Kishore Bagh, Delhi Road Income Tax Office, Delhi Road
Saharanpur Saharanpur
AHFPC3855K (RESPONDENT)
(APPELLANT)
ITA No.4984/DEL/2012 (A.Y 2009-10)
ACIT Vs Sunita Chopra
Circle Saharanpur, Prop. M/s. New Chopra Fire
Uttar Pradesh Works,
Ambala Road
Saharanpur
AHFPC3855K
(APPELLANT) (RESPONDENT)
Appellant by Sh. Sanjay Kumar, CA
Respondent by Sh. N. K. Bansal, Sr. DR
Date of Hearing 25.05.2017
Date of Pronouncement 01.08.2017
ORDER
PER SUCHITRA KAMBLE, JM
These two appeals are filed against the order dated 27/6/2012 passed by CIT(A)- Muzaffarpur.
2. The ground of appeal are as under:- (ITA No. 1512/Del/2012)
1. "Because, the "CIT(Appeals)" has exceeded his authority and jurisdiction as is conferred on him u/s 251(1)(a) of the Act in 2 ITA No.3918/Del/2010 making/giving various observations/directions as appearing at Page 14 of the appeal order dated 27/6/2012, commencing from "Admittedly,....................."
2. Because observations made/directions given in the appeal order dated 27/6/2012 as referred to above, are wholly uncalled for an extraneous in deciding the appeal/subject matter of appeal before him and the same are liable to be quashed.
3. Because the order appealed against is contrary to the principles of natural justice."
(ITA No. 4984/Del/2012)1. "On the facts and in the circumstances of the case, the CIT(A) has erred in law in deleting the addition of Rs.33,03,472/- made by the Assessing Officer on account of surrendered income of Rs.40,00,000/- during the course of survey by ignoring the fact that the assessee submitted a letter dated 19/5/2008 to the then Addl. Commissioner of Income Tax, Range, Saharanpur in connection with survey conducted at her premises on 7/5/2008 stating therein that she was surrendering a sum of Rs.40,00,000/- as her income other than rgular income subject to no penal action. Accordingly surrender of Rs.40,00,000/- made by the assessee was rightly added to the income of the assessee for Assessment Year 2009-10.
3. The Assessee is an individual deriving income from trading of crackers. Return declaring income of Rs.6,96,528/- along with agricultural income of Rs. 40,000/- was filed on 16.03.2010. Survey u/s. 133A of the Income Tax Act, 1961 was conducted on 08.05.2008. During the course of assessment proceedings the Assessing Officer vide letter dated 23.12.2011 pointed out to the assessee that at the time of survey u/s. 133A of the Act in her business premises, an amount of Rs. 40 lacs was surrendered by her in addition to the normal income. However, a perusal of return of income showed that the assessee had filed return on 16.03.2010 showing net total income of Rs. 8,78,730/- which included amount surrendered at Rs. 6,96,528/-. The 3 ITA No.3918/Del/2010 assessee was accordingly required to show cause as to why the difference of Rs. 33,03,472/- be not added to her income. In response, the assessee submitted that it was correct that a survey was conducted u/s 133A of the Act and during the course of survey, loose papers and other documents were impounded u/s. 131(3) of the Act which related to period of A.Ys. 2007-08, 2008-09 and 2009-
10. The assessee agreed to surrender the amount of Rs. 40 Lacs and paid the amount of Rs. 3 lacs as tax for A.Y. 2008-2009. The Assessee submitted that the department would have accepted the surrender of Rs. 40 lacs in AY 2009- 10, there would not have been any burden of interest which was payable in the preceding AYs. 2007-08, 2008-09. In spite of such burden, the assessee had agreed for the assessment for AYs. 2007-08 to 2009-10. As per assessee she was a widow who had for the first time started business of crackers in AY 2007-08. She was not having knowledge of taxation at all. The Assessing Officer mentioned that the assessee revised her returns of previous years which were processed as 'belated returns' and proceedings were filed. The assessee pressed the department to regularize her returns filed for the previous years during the assessment proceedings. The Assessing Officer held that the surrender was always made for the year in which it was conducted and not for other years. Further, if the assessee wanted to bifurcate the surrender in different years, it could be possible only if a statement was recorded to such effect with the consent of the Authorised Officer but such was not a case with the assessee. Thus, the Assessing Officer added the difference of Rs. 33,30,472/- to the income of the assessee. The Assessing Officer also added the amount of Rs. 40,000/- to the income of the assessee under the head 'income from other sources'.
4. Being aggrieved, the assessee filed appeal before the CIT(A). The CIT(A) partly allowed the appeal of the assessee on the first issue with the direction to the Assessing Officer that investigation be done for A.Y. 2008-09 and 2009-10 and dismissed the second issue.
4 ITA No.3918/Del/20105. The Ld. AR submitted that while disposing of the appeal for AY 2009-10 the CIT(A) directed the AO to immediately take remedial action for AY 2008-09 i.e. for the period/ year which was not in appeal before him. Therefore, the CIT(A) exceeded his jurisdiction, while giving such direction. The powers of the CIT(A) as per Section 251 of the Act was only to the extent of confirming, reducing, enhancing or annulling the assessment. The Ld. AR further submitted that there is no mention in the said section about the direction to the Assessing Officer to frame the assessment in a particular manner. The Ld. AR relied upon the decision of the ITAT, Lucknow in case of Smt. Uma Goenka Vs. ACIT (ITA No. 421/LKW/2011 A.Y. 2001-02 order dated 24.08.2012).
6. The Ld. DR relied upon the orders of the Assessing Officer and CIT(A). The Ld. DR submitted that the CIT(A) has rightly given the directions to the Assessing Officer for investigation.
7. We have heard both the parties and perused the relevant records. The direction of the CIT(A) that of directing the AO to immediately take remedial action for AY 2008-09 i.e. for the period/ year which was not in appeal before him is not as per powers bestowed upon the CIT(A) under Section 251 of the Act. The sole issue raised before us is with regard to the powers of the CIT(A). The directions given to Assessing Officer as relating to conducting further inquiry does not come under the purview of the powers under Section 251 of the Income Tax Act, 1961. And thus the direction of the CIT(A) to the Assessing Officer to conduct further inquiry is bad in law. Relevant extract of Section 251 of the Income Tax Act, 1961 reproduced hereinbelow:
251. Powers of the Commissioner (Appeals).- (1) In disposing of an appeal, the Commissioner (Appeals) shall have the following powers--
(a) in an appeal against an order of assessment, he may confirm, reduce, enhance or annul the assessment;5 ITA No.3918/Del/2010
The words "or he may set aside" was omitted by the Finance Act, 2001 w.e.f. 1.06.2001. While disposing of the appeal for AY 2009-10 the CIT(A) directed the AO to immediately take remedial action for AY 2008-09 i.e. for the period/ year which was not in appeal before him. Therefore, the CIT(A) exceeded his jurisdiction, while giving such direction. The powers of the CIT(A) as per Section 251 of the Act was only to the extent of confirming, reducing, enhancing or annulling the assessment. There is no mention in the Section 251 about the direction to the Assessing Officer to frame the assessment in a particular manner. Thus, the CIT(A) override his powers given under Section 251 of the Act. Thus, the appeal of the assessee is allowed.
8. As on merits, it can be seen that during the Assessment proceedings, the Assessee submitted that the department would have accepted the surrender of Rs. 40 lacs in AY 2009-10, there would not have been any burden of interest which was payable in the preceding AYs. 2007-08, 2008-09. The Assessing Officer mentioned in the Assessment Order that the assessee revised her returns of previous years. The assessee pressed the department to regularize her returns filed for the previous years during the assessment proceedings, but the same was not regularized by the Assessing Officer. The CIT(A) clearly made an observation in his order that the assessee disclosed Rs. 25,46,528/- as her business income against the surrender of Rs. 40 lac made by her. The CIT(A) further observed that the surrender of Rs. 18,50,000/- made by the assessee in A.Y. 2008-09 and Nil surrender made in A.Y. 2007-08, and excess stock of Rs. 36,29,000/- as on 31.03.2008 was admitted by the assessee on the day of the survey operation. The fact that major transactions took place during A.Y. 2008- 09 and only 38 days involved for A.Y. 2009-10, the surrender of Rs. 6,96,528/- made by the assessee in respect of her business was accepted by the CIT(A). Once the said transaction is accepted by the CIT(A) as well as not disputed by the Assessing Officer. Thus, the finding of the CIT(A) that the purchases to the tune of Rs. 1,11,31,650/- are reflected in the documents against the disclosed purchases of Rs. 33,68,610/- only in the profit and loss account for A.Y. 2008- 6 ITA No.3918/Del/2010 09 was correct and there is no need to interfere with the same. Thus, the appeal of the revenue is dismissed.
9. In result, appeal of the Assessee is allowed and appeal of the Revenue is dismissed.
Order pronounced in the Open Court on 1st August, 2017.
Sd/- Sd/-
(R. K. PANDA) (SUCHITRA KAMBLE)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Dated: 01/08/2017
R. Naheed *
Copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(Appeals)
5. DR: ITAT
ASSISTANT REGISTRAR
ITAT NEW DELHI
Date
1. Draft dictated on PS
25/05/2017
2. Draft placed before author PS
26/05/2017
3. Draft proposed & placed before .2017 JM/AM
the second member
7 ITA No.3918/Del/2010
4. Draft discussed/approved by JM/AM
Second Member.
5. Approved Draft comes to the PS/PS
Sr.PS/PS 02.08.2017
6. Kept for pronouncement on PS
7. File sent to the Bench Clerk 02.08.2017 PS
8. Date on which file goes to the AR
9. Date on which file goes to the
Head Clerk.
10. Date of dispatch of Order.