UTTAM PRAKASH, Jaipur V. DCIT, Jaipur

CO 3/JPR/2017

• Counselvise Citation: [2018] 123 COUNSELVISE.COM (IT) 3892 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 4 month(s) 3 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 18-06-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 15-02-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SEEMA MEENA
• Assessee Lawyers: S L JAINADV; PREMLATA ADV DH

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH HKKXPAN] YS[KK L NL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI BHAGCHAND, A M VK;DJ VIHY LA- @ ITA NO. 958/JP/2016 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2010-11 THE DCIT, CIRCLE-2, JAIPUR. CUKE VS. SHRI UTTAM PRAKASH 20/108, BHRIGU MARG, KAVERI PATH, MANSAROVAR, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: ADUPP 9269 K VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDE NT CO NO. 03/JP/2017 (ARISING OUT OF ITA NO. 958/JP/2016) FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2010-11 SHRI UTTAM PRAKASH 20/108, BHRIGU MARG, KAVERI PATH, MANSAROVAR, JAIPUR. CUKE VS. THE DCIT, CIRCLE-2, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: ADUPP 9269 K VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS @ REVENUE BY : SMT. SEEMA MEENA (JCIT) FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI S.L. JAIN(ADV.) & SHRI PREMLATA (ADV.) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 14/06/2018 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 18/06/2018 VKNS'K@ ORDER ITA NO. 958/JP/2016& CO NO. 03/JP/2017 DCIT V SHRI UTTAM PRAKASH 2 PER: VIJAY PAL RAO, J.M. THIS APPEAL BY THE REVENUE AND CROSS OBJECTION BY T HE ASSESSEE ARE DIRECTED AGAINST THE ORDER DATED 31.08.2016 OF CIT (A), JAIPUR FOR THE A.Y. 2010-12.THE REVENUE HAS RAISED THE FOLLOWI NG GROUNDS AS UNDER:- (I) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE ID. CIT(A) HAD ERRED IN DELETING THE ENTIRE ADDITION OF RS. 1,79,47,866/- MADE BY THE AO WITHOUT APPRECI ATING THE FACT THE SUBSTANTIVE ADDITION HAS BEEN DELETED BY T HE LD. CIT(A) VIDE ORDER DATED 12.07.2016 FOR THE AY 2010-11 IN I TA NO. 686/2012-13 IN THE INTEREST OF REVENUE. (II) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE THE ID. CIT(A) HAS ERRED IN IGNORING THE FACT THAT EVEN THO UGH BALANCE OF BOTH THE PARTIES ARE TALLIED, RECONCILIATION WAS DO NE WITHOUT ANY LOGIC. (III) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE ID. CIT(A) HAS ERRED IN IGNORING THE FACT THAT STATEMEN TS THAT CHEQUES WERE ISSUED BY SHRI RANJEET SINGH WERE GOT REALIZED ONLY AFTER 31.03.2010 ARE NOT TENABLE. IF CHEQUES WERE I SSUED BY SHRI RANJEET SINGH, THE DEBIT BALANCE OF SHRI UTTAM PRAK ASH WOULD HAVE INCREASED BY CHEQUES AMOUNT. THE DEBIT BALANCE IS NOT REFLECTING AS SUCH, HENCE ADDITION WAS MADE AS UNDI SCLOSED INVESTMENT IN THE HANDS OF SHRI RANJEET SINGH. ON T HE OTHER HAND, PROTECTIVE ADDITION WAS MADE IN THE HANDS OF SHRI UTTAM PRAKASH. (IV) THE APPELLANT CRAVES THE RIGHT TO AMEND ALTER OR ADD TO ANY OF THE GROUNDS OF APPEAL GIVEN ABOVE.' ITA NO. 958/JP/2016& CO NO. 03/JP/2017 DCIT V SHRI UTTAM PRAKASH 3 2. WE HAVE HEARD THE LD. DR AS WELL AS THE LD. AR A ND CONSIDERED THE RELEVANT MATERIAL ON RECORD. THE AO MADE AN ADD ITION ON PROTECTIVE BASIS ON ACCOUNT OF DISCREPANCY IN THE CREDIT BALAN CE APPEARING IN THE BOOKS OF THE ASSESSEE AND IN THE BOOKS OF SHRI RANJ EET SINGH CHOUDHARY WHO HAD UNDERTAKEN THE WORKS CONTRACT FRO M THE ASSESSEE. AT THE OUTSET WE NOTE THAT THE LD. CIT(A) HAS DELET ED PROTECTIVE ASSESSMENT MADE BY THE AO ON THE GROUND THAT THE SU BSTANTIVE ADDITION IN CASE OF SHRI RANJEET SINGH CHOUDHARY IT SELF WAS DELETED. WE NOT THAT IN THE CASE OF SHRI RANJEET SINGH CHOUDHAR Y THE SUB CONTRACTOR OF ASSESSEE THIS TRIBUNAL IN ITA NO. 780 & 880/JP20 16 HAS CONFIRMED THE ORDER OF THE LD. CIT(A) IN DELETING THE ADDITIO N MADE BY THE AO AND HELD IN PARA 4 AS UNDER:- 4. HAVING CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD, WE NOTE THAT THE ENTIR E CONFUSION ON THE ISSUE IS THE AMOUNT OF RS. 1,51,71,836/- APPEAR ING IN THE LEDGER ACCOUNTS IN THE BOOKS OF THE ASSESSEE AS WEL L AS OF SHRI UTTAM PRAKASH BUT THE SAID AMOUNT WAS NOT APPEARING IN THE BALANCE SHEET OF THE ASSESSEE DUE TO THE METHOD OF ACCOUNTING ADOPTED BY THE ASSESSEE. THIS RECEIPT IS ON ACCOUN T OF SUB- CONTRACT EXECUTED BY THE ASSESSEE ON BEHALF OF SHRI UTTAM PRAKASH FOR CONSTRUCTION OF CRPF WALL AND THEREFORE AS FAR AS THE AMOUNT RECEIVED ON ACCOUNT OF THE SAID EXECUTION AN D CORRESPONDING PAYMENT BY THE ASSESSEE TO SHRI UTTAM PRAKASH IS CONCERNED, THE SAME IS NOT IN DISPUTE. FURTHER, THE AO HAS NOT CONSIDERED THE VARIOUS EXPENSES ON ACCOUNT OF SUPPL Y OF MATERIAL, ITA NO. 958/JP/2016& CO NO. 03/JP/2017 DCIT V SHRI UTTAM PRAKASH 4 WAGES AND OTHER EXPENDITURES WHICH IS SHOWN IN THE WORK ACCOUNT TO MAKE THIS ADDITION OF NOT SHOWING THE EN TIRE AMOUNT IN THE BALANCE SHEET. IN THE REMAND REPORT, THE AO HAS NOT DISPUTED THE CORRECTNESS OF THE AMOUNT OF RECEIPT A ND PAYMENT BUT THE ADDITION WAS MADE ONLY ON THE GROUND THAT A N EQUAL AMOUNT WAS NOT APPEARING IN THE BALANCE SHEET OF TH E ASSESSEE. THE LD. CIT (A) AFTER CONSIDERING THE REMAND REPORT AND BALANCE SHEET OF THE ASSESSEE AS WELL AS OF SHRI UTTAM PRAK ASH HAS FINALLY GIVEN THE FINDING AS UNDER :- FROM THE VARIOUS ACCOUNTING STATEMENTS REPRODUCED ABOVE, IT CAN BE APPRECIATED THAT AS PER THE BOOKS OF ACCOUNTS OF SHRI UTTAM PRAKASH, SUM OF RS. 1,51,71, 836/- WAS PAYABLE TO THE APPELLANT AS ON 31.03.2010. THE BALANCE OF RS. 1,51,71,836/- (DEBIT) IS ALSO APPEAR ING IN THE ACCOUNT OF UTTAM PRAKASH (WORKS) AS APPEARING IN TH E BOOKS OF ACCOUNTS OF THE APPELLANT. THUS, AS FAR AS THE CLOSING BALANCE OF SHRI UTTAM PRAKASH IN THE BOOKS OF THE APPELLANT (AS APPEARING IN UTTAM PRAKASH WORKS ACCO UNT) AND CLOSING BALANCE OF THE APPELLANT IN THE BOOKS O F ACCOUNTS OF SHRI UTTAM PRAKASH ARE CONCERNED, BOTH ARE SAME AND THERE IS NO DIFFERENCE IN THE BALANCES APP EARING IN THE BOOKS OF ACCOUNTS OF BOTH THE PARTIES. HOWEV ER, IN THE BALANCE SHEET DATED 31.3.10 OF THE APPELLANT, N O DEBIT BALANCE OF RS. 1,51,71,836/- IN THE NAME OF SHRI UT TAM PRAKASH WAS APPEARING. HENCE, THE AO MADE THE ADDIT ION OF RS. 1,51,71,836/- TREATING THE AMOUNT AS UNRECON CILED BALANCE OF SHRI UTTAM PRAKASH. IF THE BALANCE SHEET OF THE APPELLANT ALONG WITH ANNEXURE C OF THE BALANCE SHEE T IS SEEN THEN IT CAN BE APPRECIATED THAT THE ASSESSEE H AS SHOWN CREDIT BALANCE OF RS. 9,04,570/- WHICH INCLUD ES THE AMOUNT OF RS. 27,76,030/- UNDER THE HEAD ADVANCES FOR UTTAM PRAKASH WORKS. IN OTHER WORDS, THE APPELLAN T INSTEAD OF SHOWING DEBIT BALANCE OF RS. 1,51,71,836 /- IN THE NAME OF SHRI UTTAM PRAKASH, HAS SHOWN CREDIT BA LANCE ITA NO. 958/JP/2016& CO NO. 03/JP/2017 DCIT V SHRI UTTAM PRAKASH 5 OF RS. 27,76,030/- UNDER THE HEAD ADVANCES FOR UTT AM PRAKASH WORKS. IF THE DETAILED SUBMISSION FURNISH ED BY THE APPELLANT IS PERUSED, IT CAN BE COMPREHENDED TH AT THERE WAS UNPAID LIABILITY OF RS. 1,79,47,866/- IN RESPECT OF THE WORKS EXECUTED BY THE APPELLANT ON BEHALF OF SH RI UTTAM PRTAKASH ON SUB CONTRACT BASIS. THE ASSESSEE INSTEAD OF SHOWING THIS UNPAID LIABILITY OF RS. 1,7 9,47,866/- IN THE LIABILITIES SIDE OF THE BALANCE SHEET AND RS . 1,51,71,836/- IN THE ASSET SIDE OF THE BALANCE SHEE T HAS NETTED BOTH THE BALANCES AND HAS SHOWN THE NET CRED IT BALANCE OF RS. 27,76,030/- (DEBIT BALANCE OF RS. 1,51,71,836/- OF SHRI UTTAM PRAKASH UNPAID LIABIL ITIES OF RS. 1,79,47,866) IN RESPECT OF WORKS EXECUTED BY TH E APPELLANT ON BEHALF OF SHRI UTTAM PRAKASH ON SUB CO NTRACT BASIS. THUS, AS FAR AS BALANCE IN THE ACCOUNT OF TH E APPELLANT IN THE BOOKS OF SHRI UTTAM PRAKASH AND BA LANCE OF SHRI UTTAM PRAKASH IN THE BOOKS OF THE APPELLANT ARE CONCERNED, THERE IS NO DIFFERENCE. THE DIFFERENT F IGURES APPEARING IN THE BALANCE SHEET OF THE APPELLANT AND IN THE BALANCE SHEET OF SHRI UTTAM PRAKASH ARE ONLY BECAUS E OF THE MANNER IN WHICH THESE FIGURES HAVE BEEN PRESENT ED IN THE BALANCE SHEET. IF THE ASSESSEE HAD NOT REDUCED THE UNPAID LIABILITY OF RS. 1,79,47,866/- FROM THE DEBI T BALANCE OF RS.1,51,71,836/- OF SHRI UTTAM PRAKASH, THE DEBI T BALANCE OF RS. 1,51,71,836/- WOULD HAVE BEEN SHOWN IN THE ASSET SIDE AND UNPAID LIABILITIES OF RS. 1,79,47,86 6/- WOULD HAVE BEEN SHOWN UNDER THE LIABILITY SIDE OF THE BAL ANCE SHEET AND THERE WOULD NOT HAVE BEEN ANY CREDIT BALA NCE OF RS. 27,76,030/- UNDER THE HEAD ADVANCES FOR UTTAM PRAKASH WORKS. IN VIEW OF THESE FACTS, I AM OF THE CONSIDERED VIEW THAT AS FAR AS BALANCE OF SHRI UTTA M PRAKASH IN THE BOOKS OF APPELLANT AND THE BALANCE O F THE APPELLANT IN THE BOOKS OF SHRI UTTAM PRAKASH ARE CO NCERNED SAME ARE TALLIED AND NO ADDITION ON ACCOUNT OF ANY ITA NO. 958/JP/2016& CO NO. 03/JP/2017 DCIT V SHRI UTTAM PRAKASH 6 UNRECONCILED DIFFERENCE OF RS. 1,51,71,836/- OR RS.27,76,030/- IS CALLED FOR. THUS ALL THE RELEVANT FACTS AND FIGURES WERE CONSID ERED BY THE LD. CIT (A) TO RECONCILE THE DIFFERENCES APPEARING IN T HE BALANCE SHEET OF THE ASSESSEE AS WELL AS IN THE BALANCE SHE ET OF SHRI UTTAM PRAKASH. ACCORDINGLY, IN VIEW OF THE FACTS AN D CIRCUMSTANCES OF THE CASE, WE DO NOT FIND ANY ERROR OR ILLEGALITY IN THE IMPUGNED ORDER OF LD. CIT (A) QUA THIS ISSUE. THUS, IT IS CLEAR THAT WHEN THE SUBSTANTIVE ADDITIO N ITSELF WAS DELETED ON THE MERITS THEN THE PROTECTIVE ADDITION MADE BY THE AO WOULD NOT SURVIVE. ACCORDINGLY, IN VIEW OF THE DECISION OF TH E COORDINATE BENCH OF THIS TRIBUNAL IN CASE OF SHRI RANJEET SINGH CHOUDHA RY WHEREIN THE INCOME ASSESSED ON SUBSTANTIVE BASIS WAS DELETED, W E DO NOT FIND ANY ERROR OR ILLEGALITY IN THE ORDER OF THE IMPUGNED OR DER QUA THIS ISSUE. 3. THE ASSESSEE IN THE CROSS OBJECTION HAS RAISED THE FOLLOWING GROUNDS:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE THE LD. CIT(A)-II WAS FULLY JUSTIFIED IN DELETING THE ADDIT ION OF RS. 1,79,47,866/- MADE BY THE LD. AO ON PROTECTIVE BASI S. 2. THAT THE APPELLANT RESERVES HIS RIGHT TO ADD, AM END OR ALTER THE GROUNDS OF CO ON OR BEFORE THE DATE OF HEARING. ITA NO. 958/JP/2016& CO NO. 03/JP/2017 DCIT V SHRI UTTAM PRAKASH 7 4. THE ASSESSEE HAS NOT RAISED ANY INDEPENDENT GROU ND IN THE CROSS OBJECTION BUT HAS SUPPORTED THE ORDER OF THE LD. CI T(A). THEREFORE, WHEN THE APPEAL OF THE REVENUE IS DISMISSED, THE CR OSS OBJECTION OF THE ASSESSEE BECOMES INFRUCTUOUS. IN THE RESULT, THE APPEAL OF THE REVENUE AND CROSS OBJECTION OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 18/06/2018. SD/- SD/- HKKXPAN FOT; IKY JKO (BHAGCHAND) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 18/06/2018. * SANTOSH. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- THE DCIT, CIRCLE-2, JAIPUR. 2. IZR;FKHZ@ THE RESPONDENT- SHRI UTTAM PRAKASH, JAIPUR. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 958/JP/2016 & CO NO. 03/JP/2017} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR