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Income Tax Appellate Tribunal, ‘A’ SMC BENCH, CHENNAI
Before: SHRI N.R.S. GANESAN
आदेश /O R D E R
This appeal of the assessee is directed against the order of the Commissioner of Income Tax (Appeals), Salem, dated 15.11.2018 and pertains to assessment year 1999-2000.
Shri N.V. Balaji, the Ld.counsel for the assessee, submitted that this is second round of litigation before this Tribunal. The first issue arises for consideration is cost of construction. According to the Ld. counsel, there was a survey under Section 133A of the Income-tax Act, 1961 (in short 'the Act'). During the course of survey operation, the assessee admitted that he spent ₹7,50,000/- towards cost of construction for the assessment year 1999-2000. However, in the return of income, he restricted the investment only to ₹4,50,000/-. According to the Ld. counsel, the total cost of the investment is only ₹18,30,430/-, out of which, ₹4,50,000/- was spent during the year under consideration and the balance amount was spent in the assessment year 2000-01. According to the Ld. counsel, the assessee has disclosed the balance amount in the subsequent assessment year. If ₹7,50,000/- is taken during the year under consideration, that would amount to double addition. The Ld.counsel further submitted that there is no material other than the statement recorded during the course of survey operation.
On the contrary, Shri K. Hari Govind, the Ld. Departmental Representative, submitted that during the course of examination, the assessee admitted that he invested ₹7,50,000/- in the construction of building. The Departmental Valuation Officer estimated the total cost of construction at ₹20 lakhs. Since the assessee has disclosed only ₹4,50,000/- upto 31.03.2009, the balance of ₹3 lakhs was added to the total income.
I have considered the rival submissions on either side and perused the relevant material available on record. The total cost of construction in the assessment years 1999-2000 and 2000-01 was estimated by the Departmental Valuation Officer at ₹20 lakhs. However, the assessee states as ₹18,30,430/-. There was a difference of about ₹1,70,000/-. Estimation would vary, depending upon person to person. Moreover, estimation may not always reflect the actual cost of investment. There may be a little difference. In other words, estimation always requires little bit of guess work and assumption. Therefore, after taking into consideration all the factors, the total cost of construction for both the assessment years, i.e. 1999-2000 and 2000-01can be adopted at ₹18,30,430/-.
The assessee claims that an amount of ₹4,50,000/- was invested 5. during the year under consideration and the balance amount was invested in the next assessment year. The Department claims that the assessee admitted investment of ₹7,50,000/- during the year under consideration. It is not in dispute that the assessee, apart from ₹4,50,000/- disclosed ₹7,50,000/- during the year under consideration and disclosed the balance amount in the subsequent assessment year. Therefore, as rightly submitted by the Ld.counsel for the assessee, if ₹7,50,000/- is taken during the year under consideration that would amount to addition of ₹3 lakhs twice. If the investment of ₹7,50,000/- was taken into consideration during the year under consideration, then the investment in the subsequent assessment year has to be reduced to that extent. The assessment year under consideration is 1999-2000, almost 19 years passed, therefore, remitting the issue back to the file of the Assessing Officer for reconsideration may not be justified. Since the assessee has already disclosed ₹18,30,430/- in the subsequent assessment year, this Tribunal is of the considered opinion that there cannot be any addition to the extent of ₹3 lakhs during the year under consideration. Hence, this Tribunal is unable to uphold the orders of the authorities below. Accordingly, the orders of both the authorities below are set aside and the addition of ₹3 lakhs is deleted.
The next ground arises for consideration is addition of ₹2 lakhs 6. said to be received by the assessee from his wife Smt. G. Anuradha.
Shri N.V. Balaji, the Ld.counsel for the assessee, submitted that the assessee has received ₹2 lakhs from his wife. However, the Assessing Officer disbelieved the claim of receipt of ₹2 lakhs from his wife and made addition.
I heard Shri K. Hari Govind, the Ld. Departmental Representative also. It is not the case of the Revenue that the assessee and his wife are living together. Even assuming that the assessee’s wife has no independent source of income, the habit of saving in the family from the money received from the respective husband is prevalent in this part of country. Moreover, it is a usual practice that in every household the ladies use to take ₹200/- or ₹300/- from their respective husband for household expenditure. It is also a usual practice among the ladies to save money when they get it from their respective husband. This social phenomena prevailing in this part of country cannot be ignored by the judicial authorities. Therefore, the assessee’s claim that he received ₹2 lakhs from his wife has to be considered in this aspect. This Tribunal is of the considered opinion that the assessee’s wife would have saved ₹2 lakhs from the money received for her husband for household expenditure apart from the reasons stated by her before the Assessing Officer like income from tuition and money lending business. In view of these factual aspects prevalent in this part of country, this Tribunal is unable to uphold the orders of both the authorities below. Accordingly, the orders of both the authorities below are set aside and the addition of ₹2 lakhs is deleted.