C I T KOTA vs. SMT MANJU DEVI MODI

HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Income Tax Appeal No. 95 / 2008 The Commissioner of Income Tax, Kota. ----Appellant Versus Smt Manju Devi Modi, C/o Agrawal Flooring Stone Company, Morak Station, Kota. ----Respondent Connected With D.B. Income Tax Appeal No. 96 / 2008 The Commissioner of Income Tax, Kota. ----Appellant Versus Smt Manju Devi Modi, C/o Agrawal Flooring Stone Company, Morak Station, Kota. ----Respondent _____________________________________________________ For Appellant(s) : Ms. Parinitoo Jain with Ms. Shiva Goyal. For Respondent(s) : Mr. P.K. Kasliwal. _____________________________________________________ HON'BLE MR. JUSTICE K.S. JHAVERI HON'BLE MR. JUSTICE INDERJEET SINGH Judgment 17/08/2017 1. In both these appeals common questions of law and facts are involved and as they relate to the same assessee, they are decided by this common judgment. 2. By way of these appeals, the appellant has challenged the judgment and order of the Tribunal whereby the Tribunal has allowed the appeal of the assessee. 3. This Court while admitting the appeals framed the following substantial questions of law:-

(2 of 3) [ITA-95/2008] ITA No. 95/2008 admitted on 15.09.2008 “(3) Whether the interference by the Tribunal is perverse wherein the assessment orders are directed to be framed de nove under Section 263 by the Commissioner of Income Tax. (4) Whether on the and in the circumstances of the case, the ITAT is justified in canceling the order of CIT framed u/s 263, ignoring the facts that the AO had not made proper investigation on the issue of allowing interest on over draft facility against the interest income from the debtors, household expenses and rental income of the shops. The CIT has sufficient material on the fact of the record to infer that the assessment order framed by the AO is erroneous and prejudicial to the revenue in view of the decision of the Supreme Court in the case of Smt. Tara Devi Agarwal Vs. CIT (88 ITR 323)?” ITA No.96/2008 admitted on 15.09.2008 “(3) Whether the interference by the Tribunal is perverse wherein the assessment orders are directed to be framed de nove under Section 263 by the Commissioner of Income Tax. (4) Whether on the and in the circumstances of the case, the ITAT is justified in canceling the order of CIT framed u/s 263, ignoring the facts that the AO had not made proper investigation on the issue of allowing interest on over draft facility against the interest income from the debtors, household expenses and rental income of the shops. The CIT has sufficient material on the fact of the record to infer that the assessment order framed by the AO is erroneous and prejudicial to the revenue in view of the decision of the Supreme Court in the case of Smt. Tara Devi Agarwal Vs. CIT (88 ITR 323)?” 4. Counsel for the appellant contended that CIT (A) while considering the issue under Section 263 has given cogent reasons and the Tribunal has wrongly allowed the appeal and contended that the view taken by the revisional authority to proceed under Section 263 was prejudicial to the interest of the revenue, and therefore, the view taken by the revisional authority was required

(3 of 3) [ITA-95/2008] to be accepted and view taken by the Tribunal is required to be reversed. 5. Counsel for the respondent has taken us to observation of the tribunal in para 14, which reads as under:- “So far as acceptance of claimed rental income from different shops at Surat is concerned, there was nothing on record before the Ld. CIT to come to this conclusion that more rental income than claimed by the assessee was received. The Ld. Cit was thus not justified in treating the assessment order in this regard as erroneous and when it was not erroneous thee was no question of it being prejudicial to the interest of revenue. We thus while setting aside revisional order in question in this regard direct restoration of assessment order accepting the claimed household expenses and rental income from different shops at Surat.” 6. In that view of the matter, the interest income which was received from the debtor and household and other expenses in view of decision in S.A. Builder's case [288-ITR-1(SC)] which was sought by the Tribunal to be relied upon is required to be accepted. 7. Both the questions are answered in favour of assessee against the Department. 8. The appeals stand dismissed.

(INDERJEET SINGH),J. (K.S. JHAVERI),J. Mohit Grover Sr. No.46-47.