NALLURU MUNISWAMYRAJU GIRI,BENGALURU vs. DEPUTY COMMISSIONER OF INCOME TAX CIRCLE-6(2)(1), BENGALURU

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ITA 2566/BANG/2017Status: DisposedITAT Bangalore14 February 2020AY 2012-135 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal directed the AO to verify if receipts related to a company in which the assessee is a director, and to re-examine the disallowance of agricultural income, allowing the assessee to provide supporting details.

What were the facts?

The assessee, an individual with agricultural and other income, was assessed for AY 2012-13. The Assessing Officer (AO) made additions for undeclared receipts and disallowed a portion of agricultural income.

What were the issues?

Whether receipts declared by a company were wrongly added to the individual assessee's income, and whether agricultural income was correctly disallowed.

Which sections of the Income-tax Act were involved?

Section 143(1),Section 143(2),Section 142(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘B’ BENCH : BANGALORE

Before: SHRI. A. K. GARODIA & SMT. BEENA PILLAI

For Appellant: Mr. Shahnawaz Ul Rahman, JCIT – DR

ORDER

PER BEENA PILLAI, JUDICIAL MEMBER Present appeal has been filed by assessee against order dated 14/09/2017, passed by Ld. CIT(A), Bangalore-6, for assessment year 2012-13, on following grounds of appeal:

1.

1. The Learned Commissioner of Income tax (Appeals)-6, Bengaluru (“Learned CIT(A)”) has erred in facts and in law by passing an order which is opposed to the facts of the case.

2. The Learned CIT(A) has erred in facts and in law by adding the difference in turnover of Rs.8,42,823/- as other income.

3. The Learned CIT(A) has erred in facts and in law by not allowing expenditure to the tune of net profit ratio while adding back Rs. 8,42,823 as Turnover.

4. The Learned CI(A) has erred in facts and in law by disallowing agricultural income to the tune of Rs. 4,95,922.00 and adding the same as ‘Income from other sources’.

5. Such other grounds as may be urged at the time of hearing.

Page 2 of 6 ITA 2566/Bang/2017 A. Y : 2012 – 13 Brief facts of the case are as under: 2. Assessee is an individual deriving income from agriculture and other sources. Assessee filed its return of income for year under consideration on 11/12/2012, declaring income of Rs.71,18,640/-. Return was processed under section 143 (1) of the Act, and selected for scrutiny. Subsequently, notice under section 143 (2) was issued along with notice under section 142 (1) and questionnaire. In response to statutory notices, representative of assessee appeared before Ld.AO and filed requisite details as called for.

3.

Ld. AO observed that, assessee is a proprietor engaged in business of Telecom/Civil work contractor. Assessee is also a director in a company by name, M/s. Bell Teleservices Pvt. Ltd.,. During the course of assessment proceedings, assessee was called upon to furnish certain information. On perusal of information filed by assessee, Ld.AO observed that as per 26 A-S statement assessee has received a sum of Rs.6,65,823/- from M/s. Hathaway Cable and Datacom Ltd., and Rs.1,77,000/- from M/s. Power Grid Corporation of India Ltd., which has not been declared. Accordingly, Ld.AO made addition in the hands of assessee to the extent of Rs.8,42,823/-. Ld. AO also considered sum of Rs. 20,61,424/- as income from other sources and agricultural income only to the extent of Rs.12,99,244/-.

4.

Aggrieved by the order of Ld. AO, assessee preferred appeal before Ld. CIT (A) who upheld the observations of Ld. AO. Aggrieved by order of Ld.CIT(A), assessee is in appeal before us now.

Page 3 of 6 ITA 2566/Bang/2017 A. Y : 2012 – 13 5. Ground No.1 is general in nature and therefore do not require adjudication.

6.

Ground No.2-3 are in respect of addition towards differences in the turnover amounting to Rs.8,42,823/- in the hands of assessee. Ld.AR submitted that, receipts pertain to company in which assessee is a director, and such receipts have been considered as income in the hands of company and has been offered to tax. Ld. AR further submitted that TDS in respect of the same was claimed by assessee. Alternatively, Ld. AR submitted that in the event the said amount is treated as income in the hands of the assessee, corresponding expenditure must be allowed, as otherwise it would amount to double taxation.

7.

On the contrary, Ld. CIT-DR supported the orders passed by authorities below.

8.

We have perused submissions advanced by both sides in light of records placed before us. It is observed that at page 24-25 of paper book form 26 A-S for year under consideration has been placed. Ld. AR pointed out that a sum of Rs.6,65,823/-, against which TDS is deducted by M/s. Hathaway Cable and Datacom Ltd., and sum of Rs.1,77,000/-, against which, TDS is deducted by M/s. Power Grid Corporation of India Ltd.,. He referred to Ledger account placed at page 27-28 of M/s. Hathaway Cable Datacom Pvt. Ltd., in the books of M/s. Bell Teleservices India Pvt. Ltd., wherein, payments received by M/s. Bell Teleservices India Pvt. Ltd., is mentioned. In Schedule 16 of audited statement of M/s. Bell Teleservices India Pvt. Ltd., under sale of services, sum of Rs. 6,48,44,063/- has been

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