Ita/34/2011 Of The Commissioner Of Income Tax,Kozhikode v. A.c.joseph,Amakattu House, Mullankolly

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HON'BLE THE CHIEF JUSTICE DR. MANJULA CHELLUR & THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE THURSDAY, THE 16TH DAY OF JANUARY 2014/26TH POUSHA, 1935 ITA.No. 34 of 2011 -----------------------AGAINST THE ORDER IN IT 45/COCH/2006 of I.T.A.TRIBUNAL,COCHIN BENCH DATED 20-08-2010 ................. APPELLANT/APPELLANT :----------------------------- THE COMMISSIONER OF INCOME TAX, KOZHIKODE. BY ADV. SRI.JOSE JOSEPH, SC, FOR INCOME TAX RESPONDENT/RESPONDENT : --------------------------------- A.C.JOSEPH, AMAKATTU HOUSE, MULLANKOLLY, PULPALLY WAYANAD-673 579. R1 BY ADVS. SRI.ANIL D. NAIR SRI.J.R.PREM NAVAZ SMT.NIVEDITA A.KAMATH THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 16-01-2014, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: Manjula Chellur, C.J. & A.M. Shaffique, J. - - - - - - - - - - - - - - - - - - - - - - - - - - - - I.T.A. No. 34 OF 2011 - - - - - - - - - - - - - - - - - - - - - - - - - - - - Dated this the 16[th] day of January, 2014 Manjula Chellur, C.J. JUDGMENT So far as the respondent/assessee in this case, theundisclosed income assessed represent the following amounts: “ 1. Undisclosed investment in Chola Huts and Bar : Rs.32,20,000/- 2. Undisclosed investment in Victoria Hotel & Bar : Rs.45,50,000/- 3. Unexplained loan from Devasia Devasia for the investment in rubber estate at Nilambur : Rs.36,19,617/- 4. Unexplained foreign travel expenses : Rs.1,00,000/- 5. Unexplained chitty payments : Rs.9,00,000/- 6. Unexplained investment in Maria Bankers : Rs.9,47,840/- 7. Unexplained loan from friends and relatives : Rs.1,10,000/- 8. Unexplained payment of cash towards loan processing charges to Kerala Financial Corpn. : Rs. 12,500/- ------------------- Rs.1,34,59,960/- ===========” 2. So far as the undisclosed investment in M/s.Chola Huts and Bar and Victoria Hotel and Bar, simply referring to theorders of another assessee; Devasia Devasia, the authorities belowhave opined similar view in the case of present assessee. ITA No. 34 of 2011 3. Then coming to the unexplained loan from DevasiaDevasia for the investment in rubber estate at Nilambur theamount of `36,19,617/-, the Assessing Officer opined that in thetotal investment in Kottamala Rubber estate, the assessee wasable to establish the loan from Kerala Financial Corporation andIndian Overseas Bank and the balance amount `36,19,617/- saidto have been taken as loan from Devasia Devasia was notbelievable as neither the assessee nor his counsel could bring anyevidence substantiating the claim that he had taken a loan fromDevasia Devasia. 4. So far as the First Appellate Authority based on thecash flow statement of Devasia Devasia the authority opines thatthere was no need to consider this `36,19,617/-; the loan fromDevasia Devasia; the First Appellate Authority accepted this cashflow statement of Devasia Devasia. Though the assessing officeropined that when Devasia Devasia did not receive any interest forthis `36,19,617/- from Sri.A.C. Joseph it would be difficult tobelieve such statement. However, the Tribunal did not disclose ITA No. 34 of 2011 its opinion with reference to any material but simply followed theopinion of the First Appellate Authority. In that view of thematter, we are of the opinion, this also deserves to bereconsidered by the First Appellate Authority. 5. So far as the foreign travel expenses, assessee claims to have the benefit of sponsorship from M/s.Mc Dowell. Itis quite possible that the respondent assessee being partner oftwo Bar Hotels and Restaurant could have had the benefit ofsponsorship on account of these two Hotels doing good businessso far as the company is concerned. Therefore, we are notinclined to differ from the opinion of the Appellate Authorities. ITA No. 34 of 2011 its opinion with reference to any material but simply followed theopinion of the First Appellate Authority. In that view of thematter, we are of the opinion, this also deserves to bereconsidered by the First Appellate Authority. 5. So far as the foreign travel expenses, assessee claims to have the benefit of sponsorship from M/s.Mc Dowell. Itis quite possible that the respondent assessee being partner oftwo Bar Hotels and Restaurant could have had the benefit ofsponsorship on account of these two Hotels doing good businessso far as the company is concerned. Therefore, we are notinclined to differ from the opinion of the Appellate Authorities. 6. So far as Chitty payments and unexplainedinvestment in Maria Bankers, Tribunal simply confirms the ordersof First Appellate Authority without going into any discussion.Since the major portion of the amounts assessed are to bereconsidered by the First Appellate Authority, we are of theopinion, these amounts also could to be reconsidered by the FirstAppellate Authority. In other words, except `1,00,000/- said to ITA No. 34 of 2011 -:4:- be the foreign travel expenses all other amounts could bereconsidered by the First Appellate Authority. Manjula Chellur, Chief Justice. A.M. Shaffique, Judge. ttb/18/01