K.T.JOSEPH vs. THE DEPUTY COMMISSIONER OF INCOME TAX

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HON'BLE THE CHIEF JUSTICE DR. MANJULA CHELLUR & THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE MONDAY, THE 16TH DAY OF DECEMBER 2013/25TH AGRAHAYANA, 1935 ITA.No. 259 of 2013 --------------------- AGAINST THE ORDER IN ITA 604/COCH/2011 of I.T.A.TRIBUNAL,COCHIN BENCH DATED 28-03-2013 APPELLANT/RESPONDENT: ---------------------------- SHRI.K.T.JOSEPH 50/1772, YUVAJANA SAMAJAM ROAD, KADAVANTHRA KOCHI - 20. BY ADVS.SRI.ANIL D. NAIR SRI.R.SREEJITH SMT.NIVEDITA A.KAMATH RESPONDENT/APPELLANT: ----------------------------- THE DEPUTY COMMISSIONER OF INCOME TAX (APPEALS) CENTRAL CIRCLE - 2, ERNAKULAM. BY SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 16-12-2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

MANJULA CHELLUR,C.J. & A.M.SHAFFIQUE, J. = = = = = = = = = = = = = = = = I.T.A No.259 of 2013 = = = = = = = = = = = = = = = = = = = = Dated this the 16 th day of December, 2013 JUDGMENT Manjula Chellur,CJ This appeal pertains to the assessment year 2003-2004. The dispute raised in the above appeal pertains to alleged loan taken by the assessee from one Mr.Vinod who was examined by the officer before whom Mr.Vinod said to have demonstrated that he was managing the affairs of the company on commission basis and that he along with his family members owned 50 acres of land from where he earned money which was lent to the assessee herein. 2. According to the assessee, though Mr.Vinod was a PAN Card holder, since agricultural income was exempted from Income Tax, he was not offering the same to tax. This fact was not taken note of by the Assessing Officer apart from failing to consider that the assessee owned agriculture land as well. So

I.T.A No.259 of 2013 2 far as this controversy, the assessing officer rejected the case of the appellant and added 7,50,000/- as the income of the ₹ assessee. However, CIT (Appeals) placing reliance on the remand report allowed the claim of the assessee and this came to be challenged by the Revenue before the Tribunal. The Tribunal, after referring to the report in detail, opined that the Assessing Officer was justified in rejecting the statement of Mr.Vinod for the reasons mentioned in the remand report. The Tribunal further at paragraph 10 of the order clearly indicate the reasoning to disbelieve the statement of Mr.Vinod. 3. If agricultural income being the only source of income for Mr.Vinod, we fail to understand why though holding a PAN Card did not disclose his income from commission as alleged by the appellant in I.T.A.No.270 of 2013. In I.T.A No.270/2013, this very Vinod is the Commission Agent, according to the assessee company, to whom several lakhs of rupees were paid as agent by the company. In the above appeal Managing Director of the same company is the assessee to whom said loan was given by Mr.Vinod. In the absence of Vinod maintaining proper accounts, when he places reliance on the landed property

I.T.A No.259 of 2013 3 for the source of income, we fail to understand how a person who has received lakhs of rupees as commission was not an income tax assessee. Therefore, the appellate authority was justified in considering the statement of Mr.Vinod regarding both the transactions i.e. alleged commission paid to Mr.Vinod and alleged loan lent by Mr.Vinod. The reasoning of the Tribunal at paragraphs 9 and 10 of the order are based on material placed on record, especially the remand report during the appeal proceedings. Hence the appeal is rejected. MANJULA CHELLUR, CHIEF JUSTICE A.M.SHAFFIQUE, JUDGE.

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