TaxTMI 
TaxTMI 
2006 (8) TMI 283
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....ome of the assessees. The addition made by the Assessing Officer by adopting certain percentage of additional/enhanced compensation as professional income of the assessees has been enhanced by Ld. CIT (Appeals) and the Ld. CIT (Appeals) has affirmed taxation of additional/enhanced compensation, disallowance of expenditure and taxation of interest in the hands of the assessees. A year-wise chart showing income estimated by the Assessing Officer and upheld by Ld. CIT (Appeals) in both the cases is summarized hereunder:- ------------------------------------------------------- Assessment Professional Additional/enhanced Year Income estimated compensation & by Assessing interest accrued on Officer @ 10 per SB/FD assessed cent of additional/ @ 50 per cent each in ....
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....nbsp; Rs. 4,12,18,648 CIT(A) - Rs. 68,01,034 & Rs. 25,00,000 on account of Fee from R.D. Gupta ------------------------------------------------------- 1993-94&n....
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....sp; in case of appellants by Assessing Officer & C.I.T. (Appeals) -------------------------------------------------------------- CIT (Appeals) affirmed - - addition of Rs. 7,85,643 @ 50 per cent in both the cases. -------------------------------------------------------------- CIT (Appeals) affirmed - - addition of Rs 1,47,320 @ 50 per cent in both the cases. --------------------....
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....; Rs. 24,54,200 affirmed dis- Rs. 88,24,207 @ 50 per allow ance of cent in both the cases. CIT(A)- Rs. 11,92,393 Rs. 23,84,786 @ 50 per cent in both the cases. -------------------------------------------------------------- CIT (Appeals) affirmed - - addition of Rs. 2,25,368 in case of B.N. Dey. --------------------------------------------....
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....e amount of money in their individual names as well as in the names of their family members. Same allegation has been levelled against the present assessees in the order of assessment and the appellate order. The Ld. Counsel submitted that the amounts are being deposited in their names either in bank account or fixed deposit as per order of the designated Court or the Hon'ble High Court as the case may be and it remained till the litigation is finalized. Our attention was drawn to the following observation given by the Hon'ble Patna High Court, Ranchi Bench in this regard, in the case of CIT v. B.N. Dey [CWJC No. 1105 to 1108 of 1995 (R)]:- "A large area of land was acquired by the Government of Bihar for the benefit of public sector undertakings or the Government of India or for its own use under the Land Acquisition Act. The amount of compensation as determined by the Collector under that Act was paid to the land owners. The land owners objected to the quantum of compensation which gave rise to proceedings under section 18 of the Land Acquisition Act for enhancement of compensation. The subordinate Judge-cum-Land Acquisition Judge, Hazaribagh awarded higher compensation. The S....
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....001 in the case of Tribhuvan Mahto, CIT v. Tanubai D. Desai [1972] 84 ITR 713 (Bom.), Manilal Kher Ambalal & Co. v. A.G. Lulla, ITO [1989] 176 ITR 253. Yet another decision of Calcutta High Court in the case of CIT v. Sandarson & Morgans [1970] 75 ITR 433 was referred to and on the strength of these decisions and the order of ITAT, Kolkata Bench (Camp-Jamshedpur), the Ld. A/R prayed that the addition on account of additional/enhanced compensation, interest and disallowance of expense sustained by the Ld. CIT (Appeals) may kindly be ordered to be deleted. The Ld. A/R submitted that the CIT (Appeals) has arbitrarily added Rs. 25,00,000 (one half each) in assessment year 1992-93 in the case of both the appellants on account of fee received from Sri Ram Dular Gupta [Page-9 of order of CIT (Appeals) in the case of B.N. Dey]. It was submitted that the amount paid by him represents decretal amount of award granted by the designated Court in few cases which were jointly conducted with Mr. Dular Gupta, Advocate. He submitted that the sum was not paid as professional fee and therefore it cannot form part of professional income of the appellants. The nature of this receipt is similar to that ....
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....aribagh enclosing opinion of Additional Advocate General No. II. 6-7 ------------------------------------------------------------- 5. Copy of order of the Hon'ble Patna High Court, Ranchi Bench in CWJC Nos. 1105 to 1108 of 1995 (R) dated 3-5-1996. 8-23 ------------------------------------------------------------- 6. Report of valuation cell dated 16-11-1998 valuing house of Smt. Rani Dey, w/o B.N. Dey at Rs. 7,29,000 against allegation of Rs. 20,00,000 by DDI in his report dated 25-11-1993. &....
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....e-713 in the case of CIT v. Tanubai D. Desai. 77-61 ------------------------------------------------------------- 13. Copy of judgment of Bombay High Court reported in 176 ITR, Page-253 in the case of Manilal Kher Ambalal & Co. v. A.G. Lulla. 82-86 ------------------------------------------------------------- 14. Copy of judgment of Calcutta High Court reported in 75 ITR, Page-433 in the case of CIT v. Sandarsons & Morgans. 87-95 ------------------------------------------------------------- 15....
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....sp;of payment to awardee, receipts from awardee, copy of awards by which it is proved that Rs. 1,85,410 was received in assessment year 1990-91 and not in this year and written submission before CIT (Appeals). 119-155 (c) Assessment year 1990-91 - Brief note, letter to bank asking for bank statement (deposit of 1,85,410), three letters written by L.A. Judge to bank (award of Rs. 5,20,445), receipt from awardees and written ....
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....-94 - Brief note, details of payment to awardee Rs. 26.85 lakhs, details of expense of Rs. 14.41 lakhs, details of payment to advocates Rs. 5.67 lakhs, bank guarantee in respect of award of Rs. 1.12 crores in favour of Tribhuvan Mahto and its renewal, certificate of bank regarding release of Rs. 1.12 crores in favour of Tribhuvan Mahto against bank guarantee and also stating that no amount (Rs. 1.22 crores) has been &nb....
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....essment year 1989-90 - Brief note. 267 (j) Assessment year 1990-91 - Brief note. 268 (k) *Assessment year 1991-92 - Brief note and written submission before CIT (Appeals). 269-270 (l) *Assessment year 1992-93 - Brief &nbs....
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....d compensation, interest earned thereon is the income of the appellants and has also affirmed disallowance of inadmissible expense. According to Ld. Standing Counsel, the order of CIT (Appeals) is to be upheld in toto. On addition of Rs. 25,00,000 in assessment year 1992-93 by way of fees from R.D. Gupta, Advocate, the Ld. D/R submitted that the CIT (Appeals) has assigned proper reason and therefore, the addition made @ 50 per cent each in the hands of appellants are to be sustained. 7. Countering the arguments of Ld. Standing Counsel, the A/R of the appellant stated that there was no submission before CIT (Appeals) on charging section and scope of total income contained in sections 4 and 5 and therefore the CIT (Appeals) had no occasion to examine the case in the light of these two sections. Further, the CIT (Appeals) has not considered the decision of Calcutta Bench of ITAT (Camp-Jamshedpur) in the case of Tribhuvan Mahto in right perspective. According to Ld. A/R, deposit in Bank Accounts/Fixed Deposits are secondary and are appropriation/utilization of income as per Court's directive in the hands of appellants. The taxes are to be imposed on earning of income from a particul....
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....e of the Revenue that the land in question belonged to the appellants or have been held by them in some benami name. The Assessing Officer as well as CIT (Appeals) has completely failed to understand the canons of taxation and the provisions of Land Acquisition Act. Instead of taxing the land owners to whom additional/enhanced compensation has been awarded, assessment has been made in the hands of the advocates concerned who are rendering professional services only in the process of litigation. In the matrix of admitted facts on record which have not been disputed by the department in absence of any alienation or assignment, the additional/enhanced compensation, interest accrued thereon and expenditure incurred in process of litigation cannot be subject-matter of addition/disallowance in the hands of appellants. The order of the Calcutta Bench of ITAT (Jamshedpur Camp) applies with full force in the case of the appellants. It has been held in Union of India v. Paras Laminates [1990] 186 ITR 722 (SC) that a Bench of co-ordinate jurisdiction should not disregard the decision of another co-ordinate Bench. This ratio has recently been approved by Hon'ble Delhi High Court in the case of....