The Commissioner Of Income Tax, Kota v. Smt Manju Devi Modi

HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH ATJAIPUR D.B. Income Tax Appeal No. 95 / 2008 The Commissioner of Income Tax, Kota. ----Appellant Versus Smt Manju Devi Modi, C/o Agrawal Flooring Stone Company, Morak Station, Kota. ----Respondent Connected With D.B. Income Tax Appeal No. 96 / 2008 The Commissioner of Income Tax, Kota. ----Appellant Versus Smt Manju Devi Modi, C/o Agrawal Flooring Stone Company, Morak Station, Kota. ----Respondent _____________________________________________________ For Appellant(s) : Ms. Parinitoo Jain with Ms. Shiva Goyal.For Respondent(s) : Mr. P.K. Kasliwal. _____________________________________________________ HON'BLE MR. JUSTICE K.S. JHAVERI HON'BLE MR. JUSTICE INDERJEET SINGHJudgment 17/08/2017 1.In both these appeals common questions of law and factsare involved and as they relate to the same assessee, they aredecided by this common judgment. 2.By way of these appeals, the appellant has challenged thejudgment and order of the Tribunal whereby the Tribunal hasallowed the appeal of the assessee. 3.This Court while admitting the appeals framed the followingsubstantial questions of law:- ITA No. 95/2008 admitted on 15.09.2008 “(3)Whether the interference by the Tribunal isperverse wherein the assessment orders are directed tobe framed de nove under Section 263 by theCommissioner of Income Tax. (4)Whether on the and in the circumstances of thecase, the ITAT is justified in canceling the order of CITframed u/s 263, ignoring the facts that the AO had notmade proper investigation on the issue of allowinginterest on over draft facility against the interestincome from the debtors, household expenses andrental income of the shops. The CIT has sufficientmaterial on the fact of the record to infer that theassessment order framed by the AO is erroneous andprejudicial to the revenue in view of the decision of theSupreme Court in the case of Smt. Tara Devi AgarwalVs. CIT (88 ITR 323)?” ITA No.96/2008 admitted on 15.09.2008 “(3)Whether the interference by the Tribunal isperverse wherein the assessment orders are directed tobe framed de nove under Section 263 by theCommissioner of Income Tax. (4)Whether on the and in the circumstances of thecase, the ITAT is justified in canceling the order of CITframed u/s 263, ignoring the facts that the AO had notmade proper investigation on the issue of allowinginterest on over draft facility against the interestincome from the debtors, household expenses andrental income of the shops. The CIT has sufficientmaterial on the fact of the record to infer that theassessment order framed by the AO is erroneous andprejudicial to the revenue in view of the decision of theSupreme Court in the case of Smt. Tara Devi AgarwalVs. CIT (88 ITR 323)?” 4.Counsel for the appellant contended that CIT (A) whileconsidering the issue under Section 263 has given cogent reasonsand the Tribunal has wrongly allowed the appeal and contendedthat the view taken by the revisional authority to proceed underSection 263 was prejudicial to the interest of the revenue, andtherefore, the view taken by the revisional authority was required to be accepted and view taken by the Tribunal is required to be reversed. 5.Counsel for the respondent has taken us to observation of the tribunal in para 14, which reads as under:- 4.Counsel for the appellant contended that CIT (A) whileconsidering the issue under Section 263 has given cogent reasonsand the Tribunal has wrongly allowed the appeal and contendedthat the view taken by the revisional authority to proceed underSection 263 was prejudicial to the interest of the revenue, andtherefore, the view taken by the revisional authority was required to be accepted and view taken by the Tribunal is required to be reversed. 5.Counsel for the respondent has taken us to observation of the tribunal in para 14, which reads as under:- “So far as acceptance of claimed rental income fromdifferent shops at Surat is concerned, there wasnothing on record before the Ld. CIT to come to thisconclusion that more rental income than claimed bythe assessee was received. The Ld. Cit was thus notjustified in treating the assessment order in thisregard as erroneous and when it was not erroneousthee was no question of it being prejudicial to theinterest of revenue. We thus while setting asiderevisional order in question in this regard directrestoration of assessment order accepting the claimedhousehold expenses and rental income from differentshops at Surat.”different shops at Surat is concerned, there wasnothing on record before the Ld. CIT to come to thisconclusion that more rental income than claimed bythe assessee was received. The Ld. Cit was thus notjustified in treating the assessment order in thisregard as erroneous and when it was not erroneousthee was no question of it being prejudicial to theinterest of revenue. We thus while setting asiderevisional order in question in this regard directrestoration of assessment order accepting the claimedhousehold expenses and rental income from differentshops at Surat.” 6.In that view of the matter, the interest income which wasreceived from the debtor and household and other expenses inview of decision in S.A. Builder's case [288-ITR-1(SC)] which wassought by the Tribunal to be relied upon is required to beaccepted. 7.Both the questions are answered in favour of assesseeagainst the Department. 8.The appeals stand dismissed. (INDERJEET SINGH),J. (K.S. JHAVERI),J. Mohit GroverSr. No.46-47.