By Advs. Harisankar v. Menon Meera V.menon

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI MONDAY, THE 14 DAY OF MARCH 2022 / 23RD PHALGUNA, 1943 ITA NO. 64 OF 2018 AGAINST THE ORDER IN ITA 418/2016 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT/S: K.R.RAIZA AGED 33 YEARS SHELTER, JAYANTHI NAGAR, P.T.USHA ROAD, CALICUT. BY ADVS. HARISANKAR V. MENON MEERA V.MENON RESPONDENT/S: COMMISSIONER OF INCOME TAX CENTRAL CIRCLE, KOCHI - 682 013. OTHER PRESENT: SC JOSE JOSEPH THIS INCOME TAX APPEAL HAVING COME UP FOR HEARING ON 14.03.2022, ALONG WITH ITA.61/2018, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI MONDAY, THE 14 DAY OF MARCH 2022 / 23RD PHALGUNA, 1943 ITA NO. 61 OF 2018 AGAINST THE ORDER IN ITA 417/2016 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT/S: K.R. RAZIYA, AGED 33 YEARS SHELTER, JAYANTHI NAGAR, P.T. USHA ROAD, CALICUT. BY ADVS. HARISANKAR V. MENON MEERA V.MENON RESPONDENT/S: COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, KOCHI-682 013. SC JOSE JOSEPH THIS INCOME TAX APPEAL HAVING COME UP FOR HEARING ON 14.03.2022, ALONG WITH ITA.64/2018, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ITA Nos.61 & 64/2018 J U D G M E N T [ITA Nos.64/2018, 61/2018] S.V. Bhatti, J. Heard Adv. Meera V Menon and Adv. Jose Joseph for the parties. 2. One K R Raiza, R/o. Calicut/assessee is the appellant in both appeals. Commissioner of Income Tax, Central Circle, Kochi/Revenue is the respondent. The assessee, aggrieved by the common order dated 23.04.2018, is in appeal before this Court under Section 260A of the Income Tax Act 1961 (for short ‘the Act’). The details of orders of assessment etc. are stated in the following table: 2.1 The assessee is the daughter of one K A Rauf and a proprietor of M/s. K A Reclaims. On 05.11.2009, a search of K A Rauf's residence (i.e., assessee’s father) and his associates was carried out under Section 132 of the Act. On 03.05.2010, based on the documents, details, accounts seized from the premises of K A Rauf, and also that the assessee herein is residing in the same ‘Shelter’ of her father K A Rauf, notice under Section 153A read with Section 153C of the Act was issued to the assessee. On 17.02.2011, a notice under Section 142(1) of the Act was issued to the assessee. 3. The assessee objected to the notice as follows: ITA Nos.61 & 64/2018 (1) The residence “Shelter”, Jayanthi Nagar Colony, is not in the exclusive possession of Shri K A Rauf (2) The seized documents do not constitute valuable articles or things or books of accounts or documents belong to the assessee. Therefore, the reassessment set in motion under Section 153A read with Section 153C of the Act, the re-computation of return . etc is illegal and unauthorized 3.1 The other heads of the income of assessee scrutinized relate to the purchase of land at Sreerange, Maharastra. The assessing authority in the assessment order recorded the following findings: “1. The lease agreement do not have any legal validity as same is not executed in a stamp paper 2. The assessee does not have easement right (Pokkuvarau) in the said property and therefore it is not in the assessee's possession. ITA Nos.61 & 64/2018 3. The creditworthiness of lessee is not proved. 4. Sublease rent was paid in cash. 5. The assessee could not give the name and address of the person who receives the money since the assessee is in Kerala. 6. The assessee failed to produce the original of the agreement which was notarized on 6.12.2011 from Calicut. 7. The crops mentioned in the letter of lessee require a minimum of one year to yield in initial year except paddy. The agricultural income claimed by the assessee is disallowed on the ground that the very document on which the assessee is “1. The lease agreement do not have any legal validity as same is not executed in a stamp paper 2. The assessee does not have easement right (Pokkuvarau) in the said property and therefore it is not in the assessee's possession. ITA Nos.61 & 64/2018 3. The creditworthiness of lessee is not proved. 4. Sublease rent was paid in cash. 5. The assessee could not give the name and address of the person who receives the money since the assessee is in Kerala. 6. The assessee failed to produce the original of the agreement which was notarized on 6.12.2011 from Calicut. 7. The crops mentioned in the letter of lessee require a minimum of one year to yield in initial year except paddy. The agricultural income claimed by the assessee is disallowed on the ground that the very document on which the assessee is relying cannot be treated, in any manner, as constituting the relationship of lessor and lessee between the assessee and the third party from whom the source of agricultural income is claimed. The enquiry resulted in the following assessment. ITA Nos.61 & 64/2018 4. The assessee raised two principal objections, one under Section 153A r/w 153C of the Act, and second, disallowance of lease rent received from agricultural land. The appeals before the Commissioner and the Tribunal ended in dismissal. Throughout, the appeals of all the assesses brought within the scope of enquiry or scrutiny pursuant to search and seizure are heard together and the Tribunal delivered the common order dated 23.04.2018. 4.1 One K M Fathima, the mother of the assessee, raised the same questions and the circumstances are substantially the same and similar. Therefore, arguments put forward in the said ITA Nos.61 & 64/2018 case are treated as arguments heard in these appeals as well. While answering those questions, vide separate judgment dated 11.03.2022 [ITA No.67/2018 and connected matters], this Court rejected both the grounds raised by the assessee’s mother. It is conceded that the grounds now canvassed in the appeal are the same and similar to I.T.A. No.67/2018 and batch. Therefore, by following the view taken by us in ITA No.67/2018 and connected batch, the questions are answered in favour of the Revenue and against the assessee. Sd/- S.V.BHATTI JUDGE Sd/- BASANT BALAJI JUDGE PETITIONER ANNEXURES ANNEXURE A ANNEXURE B ANNEXURE C ANNEXURE D ANNEXURE E APPENDIX OF ITA 61/2018 PHOTOCOPY OF ASSESSMENT ORDER DATED 30.12.2011 PHOTOCOPY OF ORDER OF CIT(A) DT 31.3.2016 IN ITA-C-161-162/CIT(A)IV/11.12 (COMMON ORDER) ORIGINAL OF ORDER OF ITAT DT.23.4.2018 IN I.T.A.417-418/C/2016 (COMMON ORDER) STATEMENT RECORDED FROM NOTARY PUBLIC PHOTOCOPIES OF NOTICES ISSUED TO AND REPLIES RECEIVED FROM LESSEES PETITIONER ANNEXURES ANNEXURE P1 ANNEXURE P2 ANNEXURE P3 ANNEXURE P4 ANNEXURE P5 APPENDIX OF ITA 64/2018 PHOTOCOPY OF ASSESSMENT ORDER DT. 30.12.2011. PHOTOCOPY OF ORDER OF CIT[A] DT.31.03.2016 IN ITA-C 161-162/CIT[A]-IV/11.12 PHOTOCOPY OF ORDER OF ITAT DT.23.04.2018 IN I.T.A. NO.417-418/C/2016 STATEMENT RECORDED FROM NORTARY PUBLIC. PHOTOCOPIES OF NOTICES ISSUED OT AND REPLIES RECEIVED FROM LESSEES.