ITO, NEW DELHI vs. SH. NARESH KUMAR TOMAR, NEW DELHI

impugned order dated 4.9.2013, passed by the Ld. CIT (Appeals)- XXIV, New Delhi for the quantum of assessment u/s 147/143(3) for the assessment year 2007-08. In the grounds of appeal the revenue has raised following grounds:-

“1. Directing the AO to accept the revised return even when the work was awarded to M/s Gopi Construction under the proprietorship of the assessee accepting the tender documents submitted by him in his proprietorship capacity and TDS on Sub- contracts given by the assessee was made in his proprietorship capacity as is evident from Form 27A. 2. Allowing the deduction u/s 80IA (4) in respect of work awarded to M/s. Gopi Construction Prop. Naresh Kumar Tomar

1.4.2005, wherein the entire income from Gopi Construction has been shown in the hands of the said company. Thus, the income of proprietorship concern shown by the assessee in his individual hands was not correct as the same income was already shown in the hands of the company. Once the assessee has realised this mistake it has duly revised his return of income u/s 139(5). He further brought to our notice that for the same assessment year, assessment has been framed u/s 147 r.w.s. 143(3) vide order dated 17.3.2014 in the case of M/s. Arham Technologies Pvt. Ltd., wherein this entire income has now been assessed on substantive basis by the AO and claim of 80IA(4) was disallowed. The copy of the said assessment order was placed before us. Thus, this income cannot be taxed in the hands of assessee and therefore, it has rightly been deleted by CIT (A).

3. On the other hand, Ld. DR strongly relied upon the order of the AO and Ld. CIT (A).

Gopi Construction and was doing construction work. Later on, w.e.f.

1.4.2005 the said business of M/s. Gopi Construction was taken over by M/s. Arham Technologies Pvt. Ltd. The assessee’s case was that it was by mistake, income from M/s. Gopi Construction was shown in the hands of the assessee and deduction u/s 801A(4) was claimed. In fact the income of M/s. Gopi Construction could not have been assessed in the hands of the assessee as same was merged with the aforesaid company. AO did not accepted the submission of the assessee and added the entire claim of deduction u/s 80IA (4) as income of the assessee. Before the Ld. CIT (A) the assessee brought to the notice that M/s. Arhan Technologies had filed the returned income for the same assessment year, i.e., A.Y. 2007-08 in which the income of M/s. Gopi Construction was duly included and the claim of same deduction u/s 80IA(4) was subjected to scrutiny assessment. It has been further brought to our notice that income of M/s. Gopi Construction for A.Y. 2010-11 shown in the hands of the company has been accepted by the AO. Ld. CIT (A) after taking into consideration all these facts has deleted the addition in the hands of the assessee company and further observed that notice u/s 148 has been issued to M/s. Arhan Technologies for the A.Y. 2007-08 which though at that stage assessment was pending. But now that already assessment has been passed u/s 147 in the case of M/s. Arham Technologies where the income of M/s. Gopi Construction has been assessed in the hands of the company and claim has been disallowed on merits on substantive basis, therefore, the same income now cannot be taxed in the hands of the assessee.