SHRI SHARAD SHUKLA, RAIPUR V. DY.. C.I.T.-1(1), RAIPUR (CG)

CO 23/BIL/2014

• Counselvise Citation: [2018] 123 COUNSELVISE.COM (IT) 3904 (ITAT-RAIPUR)
• Duration Of Justice: 3 year(s) 5 month(s) 23 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 08-06-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 15-12-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SHEETAL SHASHWAT VERMA
• Assessee Lawyers: R B DOSHI
• Keywords: Unexplained cash credit; Additional evidence
• Section: 133A; 144; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAIPUR BENCH , RAIPUR BEFORE S HRI N.K. BILLAIYA (AM) AND SHRI RAM LAL NEGI (JM) ITA NO. 164 /RPR /20 1 4 ASSESSMENT YEAR: 2010 - 11 THE DY. COMMISSIONER OF INCOME TAX - (1), CENTRAL REVENUE BUILDING, CIVIL LINES, RAIPUR (C.G .) VS. SHRI SHARAD SHUKLA, PROP. M/S. SHARAD SHUKLA, STATION ROAD, RAIPUR (C.G.) PAN: AJJPS8996D (APPELLANT) (RESPONDENT) & CO NO. 23/RPR /201 4 (ARISING OUT OF ITA NO. 164/RPR/2014) ASSESSMENT YEAR: 2010 - 11 SHRI SHARAD SHUKLA, PROP. M/S. SHARAD S HUKLA, NEAR DESHBANDHU SCHOOL, STATION ROAD, RAIPUR (C.G.) PAN: AJJPS8996D VS. THE DY. COMMISSIONER OF INCOME TAX - (1) (1), CENTRAL REVENUE BUILDING, CIVIL LINES, RAIPUR (C.G.) (APPELLANT) (RESPONDENT) REVENUE BY : MS. SHEETAL SHASHWAT VERMA ( DR) ASSESSEE BY : SHRI R.B. DOSHI ( CA ) DATE OF HEARING: 08 /03 /201 8 DATE OF PRONOUNCEMENT: 08 / 06 /201 8 O R D E R PER RAM LAL NEGI, JM THESE ARE THE APPEAL AND CROSS OBJECTION FILED BY THE REVENUE AND THE APPELLANT/ ASSESSEE RESPECTIVELY AGAINST THE ORDER DATED 30.05.2014 2 ITA NO. 164 / RPR/2014 & CO NO. 23/RPR/ 2014 ASSESSMENT YEAR: 2010 - 11 PASSED BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS) , RAIPUR , FOR THE A S S ESSMENT YEAR 2010 - 11 , WHEREBY THE LD. CIT (A) HAS PARTLY ALLOWED THE APPEAL FILED BY THE ASSESSEE AGAINST ASSESSMENT ORDER PASSED BY THE AO U/S 144 READ WITH SECTION 143 (3) OF THE INCOME TAX ACT, 1961 (FOR SHORT THE A CT). ITA NO. 164/RPR/2014 (ASSESSMENT YEAR: 2010 - 11) 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE A CIVIL CONTRACTOR, FILED ITS R ETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER CONSIDERATION DECLARING THE TOTAL INCOME OF RS. 29,02,450/ - . SINCE, THE CASE WAS SELECTED FOR SCRUTINY , AO ISSUED NOTICE U/S 143 (2) AND 142 (1) OF THE ACT . IN RESPONSE TO THE SAID NOTICES, AUTHORIZED REPRESENT ATIVE (AR) OF THE ASSESSEE APPEARED AND SUBMITTED AUDITED FINANCE STATEMENT AND TAX AUDIT REPORT ETC. THEREAFTER, NEITHER THE ASSESSEE NOR THE AR ATTENDED THE PROCEEDINGS NOR ANY SUBMISSIONS WERE MADE ON BEHALF OF THE ASSESSEE. S INCE THE SURVEY U/S 133A HA D BEEN CONDUCTED IN THE PREMISES OF THE ASSESSEE DURING THE FINANCIAL YEAR RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION , THE ASSESSEE WAS REQUIRED TO PRODUCE THE OFFICIAL , WHO WAS RESPONSIBLE FOR KEEPING THE BILLS AND VOUCHERS, THE ACCOUNTANT WHO DE STROYED THE VOUCHERS AFTER MAKING ENTRIES, A LL BILLS VOUCHERS RELATED TO MATERIAL TRANSPORT , LABOUR ETC. SINCE THE ASSESSEE HAD OFFERED ONLY 4.1% NP AGAINST THE 8% NP OFFERED DURING SURVEY , T HE ASSESSEE WAS ASKED TO EXPLAIN THE SAME AND ALSO TO JUSTIFY THE UNSECURED LOAN ETC. IN ORDER TO OBTAIN THE REQUIRED DOCUMENTS THE AO ISSUED NOTICES FROM TIME TO TIME; HOWEVER, NO RESPONSE WAS RECEIVED FROM THE ASSESSEE. THE LAST NOTICE WAS ISSUED ON 11.12.2012. T HEREAFTER, THE ASSESSEE FILED WRITTEN SUBMISSIONS ON 07. 01.2013 AND ALSO REQUESTED TO ACCEPT THE BOOKS OF 3 ITA NO. 164 / RPR/2014 & CO NO. 23/RPR/ 2014 ASSESSMENT YEAR: 2010 - 11 ACCOUNTS INCLUDING LEDGERS, HOWEVER NOT FILED CASH BOOK , ALL LEDGER S, BILL S FOR PURCHASES VOUCHERS FOR EXPENSES AND RELEVANT SUPPORTING DOCUMENTS AND REGISTERS. THEREAFTER ONE MORE OPPORTUNITY WAS GIVEN T O THE ASSESSEE TO PRODUCE THE BOOKS OF ACCOUNT ALONG WITH BILLS FOR VOUCHER FOR VERIFICATION, HOWEVER, THE SAME WERE NOT PRODUCED. ULTIMATELY, THE AO PASSED THE ASSESSMENT ORDER U/S 144 READ WITH SECTION 143 (3) OF THE ACT AFTER INTER ALIA MAKING DISALLOWA NCE OF RS. 68,75,058/ - OUT OF THE EXPENSES CLAIM IN THE WORKS AND P&L ACCOUNT FOR WANT OF VERIFICATION IN THE ABSENCE OF BILLS AND VOUCHERS, DISALLOWANCE OF RS. 8,88,575/ - AND RS. 6,90,249/ - MADE UNDER SECTION 36(1) (III) OF THE ACT AND ADDITION OF RS. 31 ,60,500/ - MADE U/S 68 OF THE ACT. 3. THE ASSESSEE CHALLENGED THE ASSESSMENT ORDER BEFORE T HE CIT (A) . THE LD. CIT(A) AFTER HEARING THE ASSES SEE ADMITTED THE ADDITIONAL E V I DE N C E UNDE R RULE 46A OF THE INCOME TAX RULES AND DELETED THE ADDITION OF RS. 67,5 3,902/ - MADE ON ACCOUNT OF DISALLOWANCE OUT OF THE TOTAL EXPENSES CLAIMED BY THE ASSESSEE, DELETED THE ADDITIONS OF RS. 8,88,575/ - AND RS. 6,90,249/ - MADE U/S 36(1)(III) AND ALSO DELETED THE ADDITION OF RS. 31,60,500/ - MADE UNDER SECTION 68 OF THE ACT. 4. THE REVENUE HAS CHALLENGED THE ACTION IN ADMITTING ADDITIONAL EVIDENCE AND DELETING THE AFORESAID ADDITIONS MADE BY THE AO BY RAISING THE FOLLOWING GROUNDS OF APPEAL: - 1. WHETHER IN LAW AND ON FACTS & CIRCUMSTANCES OF THE CASE, THE LEARNED CIT (A) WAS JUSTIFIED IN ADMITTING ADDITIONAL EVIDENCE UNDER RULE 46A PRODUCED BY THE ASSESSEE DURING THE COURSE OF APPELLATE PROCEEDINGS AS THE ASSESSEE HAS FAILED TO GIVE ANY 4 ITA NO. 164 / RPR/2014 & CO NO. 23/RPR/ 2014 ASSESSMENT YEAR: 2010 - 11 SATISFACTORY EXPLANATION FOR NOT PRODUCING THE SAME BEFORE THE AO?. 2. WHETHER IN LAW AND ON FACTS & CIRCUMSTANCES OF THE CASE, THE LEARNED CIT (A) HAS ERRED IN GIVING RELIEF OF RS. 67,53,902/ - OUT OF ADDITION OF RS. 68,75,058/ - MADE BY THE AO OUT OF VARIOUS UNVERIFIABLE EXPENSES? 3. WHETHER IN LAW AND ON FACTS & CIRCUMSTANCES OF THE CASE, THE LEARN ED CIT (A) HAS ERRED IN DELETING THE ADDITION U/S 36(1)(III) OF THE IT ACT, 1961 OF RS. 8,88,575/ - MADE BY THE AO AS INTEREST BEARING FUNDS WERE USED FOR NON BUSINESS PURPOSES? 4. WHETHER IN LAW AND ON FACTS & CIRCUMSTANCES OF THE CASE, THE LEARNED CIT (A) H AS ERRED IN DELETING THE ADDITION U/S 36(1)(III) OF THE IT ACT, 1961 OF RS. 6,90,249/ - MADE BY THE AO AS INTEREST BEARING FUNDS WERE USED FOR NON BUSINESS PURPOSES? 5. WHETHER IN LAW AND ON FACTS & CIRCUMSTANCES OF THE CASE, THE LEARNED CIT (A) HAS ERRED IN DELETING THE ADDITION ON ACCOUNT OF UNEXPLAINED CASH CREDIT U/S 68 OF THE IT ACT, 1961 OF RS. 31,60,500/ - MADE BY THE AO? 6. THE ORDER OF THE LD. CIT (A) IS ERRONEOUS BOTH IN LAW AND ON FACTS. 5. AT THE OUTSET, THE LD. DEPARTMENTAL REPRESENTATIVE (DR) SUBM ITTED THAT THE LD. CIT (A) HAS WRONGLY ADMITTED THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE DURING THE APPELLATE PROCEEDINGS. SINCE, THE ASSESSEE HAS NOT FILED THE ENTIRE BOOKS OF ACCOUNT AND OTHER DOCUMENTS REQUIRED FOR MAKING PROPER ASSESSMENT OF INCOM E, DESPITE SUFFICIENT OPPORTUNITIES AFFORDED BY THE AO, THE LD. CIT (A) OUGHT TO HAVE REJECTED THE APPLICATION OF THE ASSESSEE FOR ADMITTING ADDITIONAL EVIDENCE . THE LD. DR FURTHER SUBMITTED THAT THE AO HAS NOT VERIFIED THE DOCUMENTS DURING THE 5 ITA NO. 164 / RPR/2014 & CO NO. 23/RPR/ 2014 ASSESSMENT YEAR: 2010 - 11 ASSESSMENT PROCEEDINGS AND EVEN DURING THE REMAND PROCEEDINGS, THE SAME WAS REQUIRED TO BE VERIFIED BY THE AO FOR DECIDING THE ISSUES INVOLVED IN THE PRESENT APPEAL. THE LD. DR FURTHER SUBMITTED THAT UNDER THESE CIRCUMSTANCES, THE ACTION OF LD. CIT (A) IN DELETING TH E ADDITIONS MADE BY THE AO IS NOT AT ALL JUSTIFIED. 6. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE LD. CIT (A) HAS RIGHTLY ALLOWED THE APPLICATION FOR ADMITTING ADDITIONAL EVIDENCE AND DELETED THE ADDITION MADE U/S 36(1)(III) OF THE ACT AND ADDITION MADE ON ACCOUNT OF UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT. THE LD. COUNSEL FURTHER SUBMITTED THAT SO FAR AS THE ADDITION MADE ON ACCOUNT OF DISALLOWANCE MADE OUT OF THE TOTAL EXPENSES CLAIMED BY THE ASSESSEE IS CONCERNED , THE LD. CIT (A) OUGHT TO HAVE DELETED THE ENTIRE ADDITION MADE BY THE AO. THE LD. COUNSEL FUR T HER SUBMITTED THAT THE ASSESSEE HAS FILED CO AND HAS CHALLENGED THE ACTION OF THE LD. CIT (A) IN SUSTAINING THE ADDITION OF RS. 1,21,156/ - OUT OF THE TOTAL ADDITION MADE BY THE AO. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND ALSO PERUSED THE DOCUMENTS IN THE LIGHT OF THE RIVAL CONTENTIONS OF PARTIES . ADMITTEDLY, THE AO HAS PASSED THE ASSESSMENT ORDER U/S 144 READ WITH SECTION 143 (3) OF THE ACT. TO JUSTIFY THIS ACTION, AO HAS ALSO MENTIONED THE DATES ON WHICH THE ASSESSEE FAILED TO APPEAR OR RESPOND TO NOTICES ISSUED FOR PRODUCTION OF REQUIRED DOCUMENTS IN CONNECTION WITH THE ASSESSMENT . WE NOTICE THAT D URING THE APPELLATE PROCEEDINGS, THE ASSESSEE MADE APPLICATION FOR AD MITTING THE BOOKS OF ACCOUNTS AND SUPPORTING DOCUMENTS AS ADDITIONAL EVIDENCE UNDER RULE 46A OF THE RULES ON THE GROUND THAT DURING THE ASSESSMENT PROCEEDINGS THE SAID DOCUMENT WERE LYING WITH THE OFFICE OF 6 ITA NO. 164 / RPR/2014 & CO NO. 23/RPR/ 2014 ASSESSMENT YEAR: 2010 - 11 THE CONCERNED CA IN CONNECTION WITH AUDIT OF THE ACCOUNTS . THE LD. CIT (A) REFERRED THE DOCUMENTS FILED ADDITIONAL EVIDENCE ALONG WITH THE REQUEST OF THE ASSESSEE TO THE AO FOR VERIF ICATION. AS POINTED OUT BY THE LD. CIT (A), THE AO STATED IN ITS REMAND REPORT THAT DOCUMENTS BEING ADDITIONAL EVIDENCE SU BMITTED BY THE APPELLANT MAY NOT BE CONSIDERED AS THE SAME ARE AFTERTHOUGHT . THE RESPONSE OF THE AO ESTABLISHES THAT THE DOCUMENTS SUBMITTED AS ADDITIONAL WERE NOT AT ALL VERIFIED BY THE AO . HOWEVER, THE LD. CIT (A) HAS DECIDED THE ISSUES RELYING ON THE DO CUMENTS SUBMITTED BY THE ASSESSEE AS ADDITIONAL EVIDENCE. 8. IN V I E W OF THE FACTS AND CIRCUMSTANCES OF THE CASE , WE ARE OF THE CONSIDERED VIEW THAT SINCE AO HAS NOT VERIFIED THE ADDITIONAL EVIDENCE ADMITTED BY THE LD. CIT (A), THE SAME IS ESSENTIALLY REQU IRED TO BE VERIFIED BY THE AO . WE THEREFORE , SET ASIDE THE FINDINGS OF THE LD. CIT(A) AND SEND THE APPEAL BACK TO THE AO FOR PASSING THE ASSESSMENT ORDER AFRESH AFTER TAKING INTO CONSIDERATION, THE ENTIRE EVIDENCE INCLUDING THE ADDITIONAL EVIDENCE ADMITTED BY THE LD. CIT(A) DURING THE APPELLATE PROCEEDINGS. CO NO. 23/RPR/2014 (ASSESSMENT YEAR: 2010 - 11) THE ASSESSEE HAS CHALLENGED THE IMPUGNED ORDER BY FILING THE PRESENT CROSS OBJECTION ON THE FOLLOWING GROUNDS: - IN THE FACTS AND CIRCUMSTANCES OF THE CASE, LD. CIT (A) WAS NOT JUSTIFIED IN SUSTAINING DISALLOWANCE OF RS. 1,21,156/ - OUT OF THE TOTAL DISALLOWANCE OF RS. 68,75,058/ - MADE BY THE A.O. OUT OF DIFFERENT HEADS OF EXPENDITURE. 2. SINCE, WE HAVE SET ASIDE THE ORDER OF THE LD.CIT (A) AND REMAND ED THE MAIN APPEAL BACK TO THE AO FOR PASSING THE ASSESSMENT ORDER AFRESH 7 ITA NO. 164 / RPR/2014 & CO NO. 23/RPR/ 2014 ASSESSMENT YEAR: 2010 - 11 AFTER TAKING INTO CONSIDERATION, THE ENTIRE EVIDENCE ON RECORD INCLUDING THE ADDITIONAL EVIDENCE SUBMITTED DURING THE APPELLATE PROCEEDINGS, THE CO FILE D BY THE ASSESSEE DOES NOT SUR VIVE . HENCE, WE DISMISS THE CO. IN THE RESULT, APPEAL FILED BY THE REVENUE FOR A SSESSMENT YEAR 2010 - 2011 IS ALLOWED FOR THE STATISTICAL PURPOSES AND CROSS OBJECTION FILED BY THE ASSESSEE IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON 8 T H JUNE , 2018 . SD/ - SD/ - ( N.K. BILLAIYA) ( RAM LAL NEGI ) ACCOUNTANT MEMBER JUDICIAL MEMBER RAIPUR, DATED: 08 / 06 / 201 8 ALINDRA, PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , RAIPUR / DR, ITAT, RAIPUR 6. / GUARD FILE . / BY ORDER, //TRUE COPY// / (DY./AS STT. REGISTRAR) / PS , RAIPUR / ITAT, RAIPUR