2019 (12) TMI 1186 - AT - Income Tax

Tribunal decisions on deductions & additions for multiple assessment years. Stay applications dismissed, deductions allowed for AY 2014-15.

Sri Suresh Kumar Jain Versus Asst. Commissioner of Income Tax Central Circle-1 Visakhapatnam

Sri Suresh Kumar Jain Versus Asst. Commissioner of Income Tax Central Circle-1 Visakhapatnam - TMI Issues Involved:1. Stay of outstanding demand for A.Y. 2014-15 to 2016-172. Addition related to disallowance of deduction u/s 80IA of the Income Tax Act3. Addition of unexplained expenditure and money u/s 69A of the Income Tax Act4. Addition of unexplained jewellery5. Charging of interest u/s 234A, 234B, and 234C of the Income Tax ActDetailed Analysis:1. Stay of Outstanding Demand for A.Y. 2014-15 to 2016-17:The assessee filed stay applications requesting for a stay of outstanding demand for the assessment years 2014-15 to 2016-17. Since the appeals were taken up simultaneously, the stay applications filed by the assessee were dismissed.2. Disallowance of Deduction u/s 80IA:During the assessment proceedings, the AO found that the assessee claimed a deduction u/s 80IA amounting to Rs. 5,13,096/- and filed Form No.10CCB manually, which was required to be filed electronically. Consequently, the AO disallowed the deduction. The CIT(A) upheld this disallowance. The Tribunal noted that the assessment was a completed assessment as no incriminating material was found during the search. Hence, the addition made by the AO without support of incriminating material was deemed unsustainable, and the appeal on this issue was allowed.3. Addition of Unexplained Expenditure and Money u/s 69A:The AO made additions based on soft copy data found during a survey, which included unexplained expenditure of Rs. 23,32,202/- and unexplained money of Rs. 1,28,90,658/-. The CIT(A) confirmed these additions. However, the Tribunal observed that the loose sheets found during the survey did not belong to the assessee as per Section 292C, which presumes documents found during a search/survey belong to the person in whose premises they were found unless proven otherwise. Since no evidence was provided to link the sheets to the assessee, the Tribunal set aside the CIT(A)'s order and deleted the additions.4. Addition of Unexplained Jewellery:During a survey at the assessee's residence, gold and silver articles were found. The AO added the value of these items to the income, as they were not disclosed in wealth tax returns. The CIT(A) allowed 50% of the jewellery as explained based on family customs and traditions. The Tribunal referred to the Board Circular, which allows credit for a certain amount of jewellery per family member. Given the family composition, the Tribunal allowed credit for 950 grams of gold jewellery, treating the entire jewellery found as explained, but upheld the addition for silver articles.5. Charging of Interest u/s 234A, 234B, and 234C:The Tribunal noted that the levy of interest under these sections is mandatory. The AO was directed to levy the interest correctly as per the provisions of the Act.Conclusion:- Stay applications for A.Y. 2014-15 to 2016-17 were dismissed.- Appeal on disallowance of deduction u/s 80IA for A.Y. 2014-15 was allowed.- Additions of unexplained expenditure and money u/s 69A for A.Y. 2014-15 were deleted.- Addition of unexplained jewellery for A.Y. 2016-17 was partly allowed.- Directions were given to correctly levy interest u/s 234A, 234B, and 234C.The Tribunal's final orders were:- I.T.A. No.585/Viz/2019 for A.Y. 2014-15 was allowed for statistical purposes.- I.T.A. No.586/Viz/2019 for A.Y. 2015-16 was allowed for statistical purposes.- I.T.A. No.587/Viz/2019 for A.Y. 2016-17 was partly allowed.