SMT. RUJUTA JANAK BHALARIA,MUMBAI vs. ITO WARD 11(3), MUMBAI

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ITA 1764/MUM/2019Status: DisposedITAT Mumbai16 March 2021AY 2012-136 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal held that the remuneration declared in the revised return was in consonance with the audited accounts of the partnership firm, which had also been accepted by the Revenue. Therefore, the addition of Rs. 16 lacs was directed to be deleted.

What were the facts?

The assessee initially declared salary income of Rs. 18 lacs from a partnership firm, but later filed a revised return showing Rs. 2 lacs. The Assessing Officer (AO) rejected the revised return, citing a substantial reduction and a higher salary in the preceding year.

What were the issues?

The primary issue was whether the AO was justified in rejecting the assessee's revised return of income which reduced the declared salary income from a partnership firm, and whether the audited accounts of the firm should be considered.

Which sections of the Income-tax Act were involved?

Section 139,Section 143(1),Section 271(1)(c),Section 234A,Section 234B,Section 234C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC-I” BENCH, MUMBAI

Before: SHRI VIKAS AWASTHY & SHRI N.K. PRADHAN

For Appellant: Shri Ankit Talsania, AR
Hearing: 10.03.2021Pronounced: 16.03.2021

O R D E R श्री विकास अिस्थी, न्मायमक सदस्म के द्िाया PER VIKAS AWASTHY, JM: This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals)-18, Mumbai [in short ‘the CIT(A)’] dated 28.01.2019 for the AY 2012-13.

2.

Shri Ankit Talsania appearing on behalf of the assessee submitted that the primary issue raised in this appeal by the assessee is against the addition of Rs. 16 lacs made on account of salary income from the partnership firm. Narrating the facts of the case, the learned AR submitted that the assesee is a working partner in partnership firm Unno Source Corporation. The assessee filed her return of income for

3.

Per contra, Shri Sanjay J. Sethi representing the department vehemently defended the impugned order and prayed for dismissing the appeal of assessee. The learned DR submitted that the partnership deed provides for remuneration to the working partner at the rate of Rs. 24 lacs per annum. The assessee in her original return of income has disclosed remuneration of Rs. 18 lacs and there is no reason as to why the remuneration to working partner is reduced to Rs. 2 lacs. The assessee had paid self-assessment tax on remuneration of Rs. 18 lacs. The deduction in salary in revised return would amount to refund of self assessment tax.

4.

We have heard the submissions made by rival sides and have considered the orders of authorities below. We have also considered the documents furnished by the assessee in the paper book. Undisputedly, the assessee filed her original return of income disclosing remuneration from partnership firm as Rs. 18 lacs. Thereafter, the assessee filed revised return disclosing remuneration from partnership firm at Rs. 2 lacs. The AO refused to accept the revised return of income as he was not convinced with the reason

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