IT : Where in preceding year disallowances were deleted, same could be followed in current year, facts being same
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[2013] 34 taxmann.com 218 (Rajasthan)
HIGH COURT OF RAJASTHAN
Commissioner of Income-tax, Udaipur
v.
Dr. Suresn Sharma*
DINESH MAHESHWARI AND ARUN BHANSALI, JJ.
D.B. IT APPEAL NO. 45 OF 2012†
JANUARY 14, 2013
Section 37(1) read with sections 133A and 143, of the Income-tax Act, 1961 - Business expenditure - Allowability of [Res judicata] - Assessment year 2004-05 - Assessee was engaged in running nursing home and also owned a marble cutting plant - Assessing Officer on basis of material found during survey disallowed certain hospital and factory expenses - In preceding year on same facts, Commissioner (Appeals) deleted disallowance on ground that trading additions had already been made in original assessment which was confirmed by Tribunal - Whether, where all relevant and material aspects equally applied to present appeal, following aforesaid decision in same terms, this appeal would also stand dismissed - Held, yes [Para 5][In favour of assessee]
FACTS
■ The assessee was engaged in running nursing home and also owned a marble cutting plant. It filed original return deduction NIL income.
■ A survey was conducted at the business premises of assessee. The assessing officer on the basis of material found during the course of survey completed the assessment by making certain additions.
■ On first appeal, the Commissioner (Appeals) deleted certain additions after analyzing the material on second and on finding that certain trading additions had already been made in original assessment.
■ On appeal by the revenue, the Tribunal confirmed the order of CIT(A).
■ On further appeal :
HELD
■ This Court while considering the appeal filed by the revenue for the assessment year 2002-03 being CIT v. Dr. Suresh Sharma [D.B. IT Appeal No. 47 of 2012] has held that the grounds as urged and the questions as suggested essentially related to the matters of appreciation of evidence for factual enquiry and rendering findings on facts about the expenditure on purchase of medicines, receipt of consultation fees and expenditure at factory and hospital. Though the Assessing Officer made the additions with reference to his opinion on the material found and impounded during the course of survey proceedings, however, the Commissioner (Appeals) disagreed with the findings of the Assessing Officer after thoroughly analyzing the material on record and after referring to the inconsistencies in the assessment order on accounting aspects and the fact that the trading additions had already been made in the original assessment. Thereafter, the Tribunal found no reason to interfere while scrutinizing the findings recorded by the Commissioner (Appeals) on relevant considerations.
■ Therefore, the reasons foregoing, on all the relevant and material aspects, equally apply to the present appeal too, which is based on self-same grounds. Thus, following the decision aforesaid and in the same terms, this appeal also stands dismissed summarily. [Para 5]
CASE REVIEW
CIT v. Dr. Suresh Sharma [D.B. IT Appeal No. 47 of 2012] (para 5) followed.
CASES REFERRED TO
CIT v. Dr. Suresh Sharma [D.B. IT Appeal No. 47 of 2012] (para 5).
K.K. Bissa for the Appellant.
ORDER
Arun Bhansali, J. - The present appeal under Section 260A of the Income Tax Act, 1961 ['the Act'] has been filed by the Revenue seeking to question the order dated 09.12.2011 passed by the Income Tax Appellate Tribunal, Jodhpur Bench, Jodhpur ['the Tribunal'] in ITA No.653/JODH/08 and C.O.No.27/JODH/2009 for the assessment year 2004-2005, whereby, the Tribunal has affirmed the order dated 17.09.2008 passed by the Commissioner of Income Tax (Appeals), Udaipur ['the CIT(A)'] partly allowing the appeal preferred by the assessee and deleting the additions of Rs.6,71,668/- on account of unaccounted factory expenses, Rs.60,438/- on account of expense of M/s Suresh Grenite, Rs.1,01,292/- on account of expense of M/s Sharma Nursing Home, Rs.50,070/- on account of low GP Rate of M/s Sharma Nursing Home, and Rs.5,05,682/- on account of income from undisclosed sources and allowing the cross objection filed by the assessee and deleting disallowance of depreciation of Rs.1,76,003/- as made by the Assessing Officer ['the AO'] in the assessment order dated 29.12.2006.
2. Having heard the learned counsel for the appellant and having perused the material placed on record, we are clearly of the view that the present appeal essentially raises issues relating to appreciation of evidence resulting in finding on facts; and no substantial question of law is involved.
3. The facts of the case may be noted thus: The assessee runs a nursing home and also owns a marble cutting plant. The assessee filed his original return of income for the assessment year 2004-2005 on 02.08.2004 declaring NIL income besides an agricultural income of Rs.64,800/-. It appears that a survey under Section 133A of the Act was undertaken on 29.11.2006 at the business premises of the assessee and on the basis of material found during the course of survey, while notice under Section 148 of the Act was issued relating to assessment years 2002-2003 and 2003-2004 and for the said assessment years assessments were completed under Section 143(3)/148 of the Act and assessment for the year 2004-2005 was completed under Section 143(3) of the Act. The AO, inter alia, made the additions, few of which were deleted by the CIT(A) as noticed hereinbefore. The appeals arising out of assessment years 2002-2003 to 2006-2007 filed by revenue were decided by the Tribunal by a common order.
4. For the assessment year 2004-2005 the Tribunal has observed as under:-
(i) Addition on account of unaccounted factory expenses:
"We have considered the findings given by the authorities below. We have already considered the similar issue in the order for the assessment year 2002-03. We find that assessee has shown receipts in the name of Suresh Granite and there are transactions in the separate bank account of M/s Suresh Granite. Further the said note book no.18 also contains transactions relating to Suresh Granite. The return of income of the wife of Assessee Mrs. Sushma Sharma has been filed in time including the income from M/s Sushma Granite. The findings given by assessing officer are not correct and the expenditure incurred and the bank deposits made by the assessee from the regular sources of receipts shown by the assessee family from various concerns. Therefore, following the findings given by us for Assessment Year 2002-03 in respect of the similar noting of expenditure, we uphold the findings given by the CIT (A) and dismiss this ground of the departmental appeal."
(ii) Addition on account of unaccounted expense of M/s Suresh Granite :
"In such circumstances, when the over all receipts covers all these expenditures, no addition can be made on the basis of noting in the diary. We find that the issue is similar to ground no.1 dealt with above and the findings given by us in that respect will apply even in respect of this issue. We accordingly uphold the order of CIT (A) on this issue also and the ground of appeal is rejected."
(iii) Addition on account of unaccounted expense of M/s Sharma Nursing Home:
"In such circumstances, there are all possibilities of accounting overall expenditure in different heads, however, the overall payments noted in these diaries are not exceeding the overall receipts shown by the assessee in all the Profit and Loss accounts of the group concerns. Therefore, no addition in respect of the unaccounted expenditure on the basis of such noting can be made. We accordingly uphold the deletion of addition on account of unexplained salary expenditure. This ground of departmental appeal is also rejected."
(iv) Addition on account of low G.P. Rate of M/s Sharma Nursing Home:
"We have dealt up this issue in detail for the assessment year 2002-03 and in view of the findings given in that respect and the facts and circumstances of the case observed above, we hereby decline to interfere with the order of the CIT(A) on this ground also. The ground of appeal of the departmental appeal is rejected."
(v) Addition on account of income from undisclosed sources:
"After hearing the rival parties and the perusing the orders of authorities below and also the material available in the paper books filed by the assessee we are of the considered view that ld. AO was not justified in holding that the business of M/s Suresh Granites has been discontinued only on the basis of disconnection of power. The assessee has shown the availability of power from the D G Set of M/s Susham Granite the proprietorship concern of the wife of assessee which is operating in the same premises. Therefore, the addition made on this count cannot be upheld. We find no reason to interfere the findings given by the CIT (A) on this count. This ground of appeal of the departmental appeal is accordingly rejected."
(vi) In relation to cross objection of the assessee:
"The disallowance is made consequent to the finding that the business of M/s Suresh Granite had been discontinued. In view of our findings above in ground no. 5 of the departmental appeal, this ground of cross objection is allowed."
5. This Court while considering the appeal filed by the Revenue for the assessment year 2002-2003 being D.B. Income Tax Appeal No.47/2012 (CIT v. Dr. Suresh Sharma) has held as under:-
"In our view, the submissions do not make out any substantial question of law for consideration by this Court in this appeal. The grounds as urged and the questions as suggested essentially relate to the matters of appreciation of evidence for factual enquiry and rendering findings on facts about the expenditure on purchase of medicines, receipt of consultation fees and expenditure at factory and hospital. Though the AO made the additions with reference to his opinion on the material found and impounded during the course of survey proceedings, however, the CIT(A) disagreed with the findings of the AO after thoroughly analyzing the material on record and after referring to the inconsistencies in the assessment order on accounting aspects and the fact that the trading additions had already been made in the original assessment. Thereafter, the Tribunal found no reason to interfere while scrutinizing the findings recorded by the CIT(A) on relevant considerations.
In an overall view of the matter, we are satisfied that the findings on facts have been rendered by the two appellate authorities in accordance with law; and the orders impugned do not suffer from any perversity or wrong application of any principle of law so as to raise any substantial question of law.
Consequently and in view of the above, the appeal fails and the same is, therefore, dismissed summarily."
The reasons foregoing, on all the relevant and material aspects, equally apply to the present appeal too, which is based on self-same grounds. Thus, following the decision aforesaid and in the same terms, this appeal also stands dismissed summarily.
ISHA
Regards
Prarthana Jalan
__._,_.___
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