Income Tax Appellate Tribunal - Mumbai
Abhishek Ramesh Vyas, Mumbai vs Department Of Income Tax on 17 June, 2013
आयकर अपीलीय अिधकरण,
अिधकरण "आई" खंडपीठ मुंबई
INCOME TAX APPELLATE TRIBUNAL,MUMBAI - 'I' BENCH.
सव[ौी बी.
बी.आर.
आर.िमƣ
िमƣल, Ûयाियक सदःय/
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ि लेखा सदःय
Before S/Sh. B.R. Mittal, Judicial Member & Rajendra, Accountant Member
आयकर अपील सं./ITA No.965/Mum/2011,िनधा[
िनधा[रण वष[/Assessment Year-2005-06
ITO 25(3)(3) C-11, 3rd Floor, Shri Abhishek R. Vyas
Pratyakshkar Bhavan, Flat No.-202, N.A. Regency Park,
Bandra(E),Mumbai- 400051. Vs. Plot No.-B, M.G. Road,
Kandivali(W),Mumbai-400067
PAN: ABYPV0770D
(अपीलाथȸ /Appellant) (ू×यथȸ / Respondent)
अपीलाथȸ ओर से / Appellant by : Neeraj Pradhan (DR)
ू×यथȸ कȧ ओर से/Respondent by : None
सुनवाई कȧ तारȣख / Date of Hearing : 17-06-2013
घोषणा कȧ तारȣख / Date of Pronouncement : 26-06-2013
आ य क र अ िधिन यम ,1 9 6 1 कȧ धा रा 2 5 4( 1) के अ Ûतग[ त आ दे श
O r d er u/ s. 2 5 4( 1) of t h e In c o me - t a x Ac t , 1 9 6 1 ( Act )
Per Rajendra, A.M.
Challenging the order of the CIT(A)-35, Mum dated 20.01.2010 Assessing Officer (AO) has filed following grounds of appeal:
i)"On the facts and in the circumstances of the case, and law, the ld.CIT(A) erred in directing the Assessing Officer to delete the addition stating that without the re-assessment making any addition in respect of the issue for which proceedings were initiated, no other addition can be made".
ii) On the facts and in the circumstances of the case, and in law, the ld.CIT(A) erred in deleting the addition without appreciating the facts of the case".
iii)The appellant prays that the order of the Id. CIT (A) on the above grounds be set aside and that of the A.O. be restored".
iv)"The appellant craves leave to amend or alter any ground or add a new ground".
Facts of the case:
2.Assessee, an individual,deriving commission income filed his return of income on 06.05.2005 declaring total income of Rs. 3.90 lakhs.During the course of assessment proceedings, in the case of assessee's Smt. Anuradha Vyas,it was found by the AO that the assessee along with his wife had jointly acquired a Flat worth Rs. 26.95 lakhs during the year under consideration. He was of the view that there were reasons to believe that income chargeable to tax had escaped assessment.He issued a notice u/s 148 of the Act. Assessee filed a revised return on 08.07.2008 2 ITA No.965/Mum/2011,(AY-2005-06) Shri Abhishek R. Vyas.
declaring the same total income i.e. Rs. 3.9 lakhs. AO reopened the case,after recording the following reasons:-
"During the course of scrutiny proceedings in the case of the assessee's wife, Ms. Anuradha Abhishek Vyas for A.Y. 2005-06 it was revealed from the purchase agreement by the undersigned from Vijaya Bank, Branch that the assessee had during the F.Y. relevant to A.Y. 2005-06 jointly purchased a flast along with his wife for a sum of Rs. 26.95 lacs. The asstt. In the case of the wife had to be completed ex-parte as the assessee failed to prove. Neither the said asset/loan liability from Vijaya Bank/Advance paid against the flat is effected in assessee's balance sheet as on 31.03.2005. I have therefore reason to believe that the sum of Rs. 26.95 lacs has escaped taxation. Reassessment proceedings u/s 147 of the Income Tax, 1961 is hereby initiated. Issue notice u/s 148 of the Income-tax Act, 1961"
AO finalised the assessment u/s 147 r.w.s. 144 and 145(3) of the Act determining the total income of the assessee at Rs.10.34 lakhs.While finalizing the assessment, he made following additions to the income of the assessee:
i)estimation of GP Rs. 1.93 lakhs ii) unexplained capital gain 4.5 lakhs.
3.Assessee preferred an appeal before the First Appellate Authority.(FAA).After considering the submissions of the assessee and the assessment order he held that AO had issued the notice u/s 148 on the prima facie belief that the share of the assessee in investment in the flat amounting to Rs.26.95 lakhs had escaped from assessment,that the AO was satisfied with the explanation filed by the assessee in this regard, that the AO did not make any addition in respect of investment in the flat in the hands of the assessee, that AO resorted to addition on other issues which were not recorded in the reasons while re-opening the assessment, that AO could made other additions / disallowances apart from the point for which the re-assessment proceedings were initiated.He further held that in the case under consideration the very point for which re-assessment proceedings were initiated was not added by the AO, that other additions could not be sustained. Referring to section 147 of the Act he held that when the AO was satisfied with the explanation offered by the assessee with regard to the investment in flat he should have dropped the re- assessment proceedings,that he should not have made other additions. He deleted the additions made by the AO and directed him to accept the income of the assessee at Rs. 3.90 lakhs.
4.Before us Departmental Representative(DR)supported the order of the AO.She relied upon the order of the Best Wood Industries & Saw Mills delivered by the Hon'ble High Court of Kerala (331ITR63).No one appeared on behalf of the assessee.
5.We have heard the submissions of the DR and perused the material before us.In this case it is found that assessment was re-opened on the belief that assessee had not disclosed his investment in flat jointly purchased with his wife.We find that after considering the submissions of the assessee in this case, AO did not make any addition to the income of the assessee.As per the settled law of re-assessment, AO can make other additions while re-computing the income of the assessee for particulars assessment year, if he makes addition of the item for which assessment is re-opened.Hon'ble High Court of Kerala in the case of Best Wood Industries & Saw Mills has held also that in course of re-assessment if it comes to the notice of the AO that any item other than the item of escaped income for which original assessment was re-opened has also escaped taxation he can add such items/income.Hon'ble High Court has nowhere held that where the item,which has escaped assessment,is not added to the income of the assessee other items could be added to the total income of the assessee.In other words for making other additions the basic addition has to be made first.In the case under consideration, we find that AO has added certain items to the income of the assessee, whereas the main reasons for re-opening the assessee was 3 ITA No.965/Mum/2011,(AY-2005-06) Shri Abhishek R. Vyas.
not considered fit for making additions. In these circumstances, in our opinion order passed by the FAA is as per the law and does not need our interference. Upholding his order we dismiss the appeal filed by the AO.
As a result, appeal filed by the AO stands dismissed.
पǐरणामतःिनधा[ǐरती कȧ अपील खाǐरज कȧ जाती है .
Order pronounced in the open court on 26th June,2013 आदे श कȧ घोषणा खुले Ûयायालय मɅ Ǒदनांक 26 जून, 2013 को कȧ गई ।
Sd/- Sd/-
(बी.आर.िमƣल /B.R. Mittal) राजेÛि/
(राजे ि Rajendra)
Ûयाियक सदःय / Judicial Member लेखा सदःय /Accountant Member
मुंबई/Mumbai,Ǒदनांक/Date: 26th June, .2013
SK
आदे श कȧ ूितिलǒप अमेǒषत/Copy
षत of the Order forwarded to :
1. Assessee /अपीलाथȸ
2. Respondent /ू×यथȸ
3. The concerned CIT (A) /संबƨ अपीलीय आयकर आयुƠ
4. The concerned CIT /संबƨ आयकर आयुƠ
5. DR "I" Bench, ITAT, Mumbai /ǒवभागीय ूितिनिध बी खंडपीठ,आ.अ.Ûयाया.मुंबई
6. Guard File/गाड[ फाईल स×याǒपत ूित //True Copy// आदे शानुस ार/ BY ORDER, उप/सहायक पंजीकार Dy./Asst. Registrar आयकर अपीलीय अिधकरण, मुब ं ई /ITAT, Mumbai