Bharat Enterprises Vs ACIT (ITAT Mumbai)
I find that the facts of the case indicate that the assessee had claimed as other income, a sum of Rs.19,87,500/- received from a buyer who had booked the flat. Further, since there was irregular payment from the buyer, the assessee had forfeited the sum of Rs.19,87,500/- and offered the same as income. However, in the meanwhile, the said person had filed a suit. There is no doubt about the existence of the suit. In the remand report, the Assessing Officer has also submitted that the said person has categorically claimed that he has not acquiesced in the forfeiture of the sums. In this background, there is no question of treatment of the said amount as assessee’s income. This amount received against the book of flat can be added in the hands of the assessee only if there is a cessation of liability. On the facts and circumstances of the case, by no stretch of imagination, it can be said that there is a cessation of liability. The Revenue authorities cannot take refuge on the mistaken offering of income by the assessee which has been cogently rebutted during the course of assessment. It is also well settled that the Revenue authority should not take advantage of the ignorance of the assessee. Accordingly, in the background of the aforesaid discussion, I hold that the said amount deserves to be excluded from the income and the Assessing Officer is directed accordingly.
FULL TEXT OF THE ITAT JUDGMENT
This appeal by the assessee is directed against the order of the ld. Commissioner of Income Tax (Appeals) dated 14.6.2017 and pertains to the assessment year 2010-11.
2. The two issues raised are as under:
