ANIL PRABAHKAR KORGAONKAR, HUF,KOLHAPUR vs. THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, KOLHAPUR

This is an appeal filed by the assessee directed against the order of ld. Commissioner of Income Tax (Appeals)-11, Pune [‘the CIT(A)’] dated 20.02.2023 for the assessment year 2019-20.

Briefly, the facts of the case are that the appellant is a HUF and is engaged in the business of Hotel under the name and style of “Hotel Hill Top”. The Return of Income for the assessment year 2019-20 was filed on 19.02.2020 declaring total income of Rs.30,80,930/-. Against the said return of income, the assessment Asst. Commissioner of Income Tax, Central Circle, Kolhapur (‘the Assessing Officer’) vide order dated 23.09.2021 passed u/s 143(3) of the Income Tax Act, 1961 (‘the Act’) accepting the returned income. However, the Assessing Officer held that the income declared during the course of survey proceedings conducted on 21.10.2019 should be assessed to tax u/s 115BBE of the Act. The factual background of the case is as under: During the course of survey proceedings conducted in the business premises of the appellant on 22.10.2019 certain incriminating documents were stated to have been impounded vide Bundle No.1 containing 79 pages. The said impounded documents revealed the cash receipts from the business of Hotel which were not accounted in the books of account, regularly maintained by the appellant. It is further revealed that during the previous year relevant to the assessment year 2019-20, a sum of Rs.13,46,586/- was not accounted in the books of account of HUF. When this information was confronted to the managing partner of the assessee, Shri Ashish Korgaokar, who is Karta of HUF, accepted that these are the business receipts and agreed to offer the tax and this amount was also credited to the Profit & Loss Account. However, the Assessing Officer treated this money as unexplained income u/s 69 of the Act and also held that it should be assessed under the provisions of section 115BBE of the Act. 3. Being aggrieved by the action of the Assessing Officer, an appeal was filed before the ld. CIT(A), who vide impugned order, confirmed the action of the Assessing Officer placing reliance on the decision of the Hon’ble Madras High Court in the case of M/s. SVS Oils Mills vs. ACIT, 113 taxmann.com 388 (Madras) by holding that the appellant had declared the additional income on account of running business of Hotel. 4. Being aggrieved, the appellant is in appeal before this Tribunal in the present appeal. 5. The ld. AR contends that during the course of survey proceedings, the appellant offered the additional income under the head “business” and credited to the Profit & Loss Account and the same was assessed under the head “income from business”. Having chosen to assess the additional income under the head “income from business”, the Assessing Officer is barred to apply the provisions of section 115BBE of the Act.