ITO, Ward - 31(2), Kolkata, Kolkata V. Shri Madhusudan Choudhury, Kolkata

ITA 1055/KOL/2011

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 5639 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 7 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-03-2014
• Appeal Filed By: Department
• Bench Allotted: C
• Assessment Year: 2008-2009
• Appeal Filed On: 01-08-2011
• Court: TRIBUNAL
• Department Lawyers: SATYAJIT MONDAL
• Assessee Lawyers: SOUMITRA CHOW DHURY
• Section: 133(6); 194C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH C , KOLKATA [BEFORE HONBLE SRI SHAMIM YAHYA, AM & HONBLE SR I GEORGE MATHAN, JM] ITA NO.1055/KOL/2011 ASSESSMENT YEAR : 2008-09 ( APPELLANT ) (RESPONDENT) I.T.O., WARD-31 (2), -VS- SHRI MADHUSUDAN CHOWD HURY KOLKATA KOLKATA (PAN ACCPC 5958 R ) FOR THE APPELLANT SHRI SATYAJIT MONDAL, JCIT, SR.DR FOR THE RESPONDENT SHRI SOUMITRA CHOWDHURY, ADVOCATE DATE OF HEARING : 25.03.2014 DATE OF PRONOUNCEMENT : 25. 03.2014. ORDER PER SHRI GEORGE MATHAN, JM THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF LD. C.I.T.(A)-XIX, KOLKATA IN APPEAL NO.69/CIT(A)-XIX/ITO,WD.31(2)/KOL /10-11 DATED 08.06.2011 FOR ASSESSMENT YEAR 2008-09. 2. SHRI SATYAJIT MONDAL, JCIT, SR.DR REPRESENTED O N BEHALF OF THE REVENUE AND SHRI SOUMITRA CHOWDHURY, ADVOCATE REPRESENTED ON BEHALF OF THE ASSESSEE. 3. IN THE REVENUES APPEAL THE REVENUE HAS RAISED T WO ISSUES. THE FIRST ISSUE IS AGAINST THE ACTION OF LD. CIT(A) IN DELETING THE AD DITION MADE REPRESENTING THE DIFFERENCE OF CLOSING STOCK AS PER THE STOCK STATEM ENT AS ON 31.03.2008 AND AS SUBMITTED BY ASSESSEE TO THE BANKING AUTHORITIES. I T WAS SUBMITTED BY THE LD. DR THAT THE AO HAD ISSUED 133(6) NOTICE TO THE BANK AND THE BANK HAD INTIMATED THAT THE ASSESSEE HAS SHOWN THE CLOSING STOCK AT RS.1,10,12, 530/- IN ITS STATEMENT TO THE BANK WHEREAS IN ITS STOCK STATEMENT THE STOCK WAS SHOWN AT RS.7,65,400/-. IT WAS THE SUBMISSION THAT THE LD. CIT(A) HAD DELETED THE ADDI TION BY HOLDING THAT THERE WAS NO EVIDENCE ON RECORD TO SHOW THAT THE BANKING AUTHORI TIES HAD INSPECTED THE STOCK ITA.NO.1055/KOL/2011 SHRI MA DHUSUDAN CHOWDHURY A.YR.2008-09 2 PHYSICALLY AS ON 31.03.2008 AND THE DATE PUT BY THE BANKING OFFICIAL IS OF 23.05.2008. FURTHER THE LD. CIT(A) WAS ALSO OF THE VIEW THAT TH E SPACE OCCUPIED BY THE ASSESSEE IS ONLY 600 SQ.FT WHICH AS PER THE SURVEYOR CAN HOLD M AXIMUM NUMBER OF 1600 BAGS WHEREAS THE STOCK STATEMENT GIVEN TO THE BANK CONT AINS 9265 BAGS. IT WAS THE SUBMISSION THAT THE LD. CIT(A) HAD DELETED THE ADDI TION BY HOLDING THAT THE AO HAD NOT POINTED OUT ANY DEFECT IN THE EVIDENCES PRODUCE D BY THE ASSESSEE WHEREAS THE ASSESSEE HAS ALSO BEEN ABLE TO PRODUCE THE STOCK ST ATEMENT BEFORE THE AO WHICH WAS WAS PRODUCED BEFORE THE BANK DATED 23.05.2008. IT WAS THE SUBMISSION THAT THE ORDER OF THE LD. CIT(A) WAS LIABLE TO BE REVERSED. THE LD . DR VEHEMENTLY SUPPORTED THE ORDER OF AO. 4. IN REPLY THE LD. AR SUBMITTED THAT THE BANK STAT EMENT WHICH IS BEING RELIED UPON IS DATED 23.05.2008 AND THE CORRESPONDING DATE TAKEN FROM THE ASSESSEES BOOK IS 31.03.2008. IT WAS THE SUBMISSION THAT THE STOCK ST ATEMENT GIVEN TO THE BANK WAS NOT OF 31.03.2008. IT WAS THE FURTHER SUBMISSION THAT T HE ASSESSEE HAD A PREMISES CONSISTING OF 600 SQ.FT WHICH AS PER THE KOLKATA MU NICIPAL CORPORATION SURVEYOR COULD HAVE HOLD ONLY 1600 BAGS OF ATTA, OR FLOUR OR SUGAR. HOWEVER, AS PER THE SAID STATEMENT GIVEN TO THE BANK ATTA, FLOUR AND SUGAR Q UANTITIES WERE OF NEARLY 9000 BAGS WHICH WAS PRACTICALLY IMPOSSIBLE TO STORE. IT WAS T HE FURTHER SUBMISSION THAT NOWHERE IN THE STOCK STATEMENT GIVEN TO THE BANK, THE BANK HAS SAID THAT THEY HAVE VERIFIED THE STOCK. IT WAS THE FURTHER SUBMISSION THAT IF ASSUMI NG THAT THE CLOSING STOCK WAS TO BE TAKEN ON THE BASIS OF THE STOCK STATEMENT GIVEN TO THE BANK DT 23.05.2008 THEN THE OPENING BALANCE WAS ALSO LIABLE TO BE ADJUSTED ON T HE SAME METHOD REPRESENTING THE STOCK STATEMENT GIVEN TO THE BANK. IT WAS THE SUBMI SSION THAT THIS WAS THE FIGURE RS.98,07,280/- WHICH AGAIN WAS PRACTICALLY IMPOSSIB LE. IT WAS THE SUBMISSION THAT THE LD. CIT(A) HAD RIGHTLY DELETED THE ADDITION. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PERU SAL OF THE ORDER OF AO SHOWS THAT THE AO HAS INVOKED HIS POWERS U/S 133(6) OF TH E ACT AND CALLED FOR THE STOCK STATEMENT FILED WITH THE BANK AUTHORITIES FOR OVERD RAFT FACILITIES AS ON 31.03.2008. HOWEVER, A PERUSAL OF THE SAID STOCK STATEMENT WHIC H HAS BEEN GIVEN BY THE BANK AS ITA.NO.1055/KOL/2011 SHRI MA DHUSUDAN CHOWDHURY A.YR.2008-09 3 BEEN RELIED UPON BY THE AO CLEARLY SHOWS THAT THE S AID STATEMENT IS DATED 23.05.2008 CLAIMING THE SAME TO BE IN MARCH, 2008. THIS ITSELF CLEARLY SHOWS THAT THE BANK COULD NEVER HAVE MADE THE PHYSICAL VERIFICATION OF THE SA ID STOCK. FURTHER, A PERUSAL OF THE DRAWING POWER REGISTER AS HAS BEEN GIVEN BY THE BAN K SHOWS THAT THE STATEMENT IS RECEIVED ON 23 RD MAY,2008 AND THERE IS NO STATEMENT RECEIVED AS ON 31.03.2008. AS THERE IS NO COMPARABLE FIGURE FOR 31.03.2008 AVAILA BLE WITH THE BANK THE FIGURES GIVEN FOR 23 RD MAY, 2008 CANNOT BE USED FOR COMPARING THE STOCK STATEMENT OF THE ASSESSEE AS PER THE BOOKS AS ON 31.03.2008 FOR THE PURPOSE O F MAKING THE ADDITION. FURTHER, ORDER OF THE LD.CIT(A) CLEARLY SHOWS THAT THE LD. C IT(A) HAS TAKEN INTO CONSIDERATION THE FACT THAT THE AO HAS NOT POINTED OUT ANY DEFECT S IN THE EVIDENCES FILED BY THE ASSESSEE TO SUBSTANTIATE ITS CLAIM THAT THE ASSESSE E DOES NOT HAVE SUCH HIGH QUANTITY OF STOCK AS ON 31.03.2008. IN THE CIRCUMSTANCES WE ARE OF THE VIEW THAT THE FINDINGS OF LD. CIT(A) IS ON A RIGHT FOOTING AND DOES NOT CALL FOR ANY INTERFERENCE. 6. IN REGARD TO THE SECOND ISSUE IT WAS SUBMITTED B Y THE LD. DR THAT THE ISSUE IS AGAINST THE ACTION OF THE LD. CIT(A) IN DELETING TH E ADDITION ON ACCOUNT OF LORRY FREIGHT AS THE ASSESSEE HAD NOT DEDUCTED TDS U/S 194C OF TH E ACT. THE LD. DR VEHEMENTLY SUPPORTED THE ORDER OF AO. 7. IN REPLY THE LD.AR VEHEMENTLY SUPPORTED THE ORDE R OF LD. CIT(A). 8. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PERU SAL OF THE ORDER OF THE LD. CIT(A) IN PAGE -12 AT PARA 5.2 THE LD. CIT(A) HAD D ELETED THE ADDITION BY FOLLOWING THE DECISION OF HONBLE PUNJAB AND HARYANA HIGH COU RT IN THE CASE OF CIT VS UNITED RICE LAND LTD. 322 ITR 594 AND BHAGWATI STEELS 326 ITR 108 AS ALSO THE DECISION OF THE COORDINATE BENCH OF THIS TRIBUNAL IN THE CASE O F ACIT VS STUMM INDIA IN ITA NO.1158/KOL/2008. AS IT IS NOTICED THAT THE LD. CIT (A) HAS DELETED THE DISALLOWANCES ON THE JUDICIAL DISCIPLINE BY FOLLOWING THE DECISIO NS OF PUNJAB & HARYANA HIGH COURT AS ALSO THE DECISION OF THE COORDINATE BENCH OF THI S TRIBUNAL WE ARE OF THE VIEW THAT THE FINDINGS OF THE LD. CIT(A) ON THIS ISSUE IS ON A RIGHT FOOTING AND DOES NOT CALL FOR ANY INTERFERENCE. ITA.NO.1055/KOL/2011 SHRI MA DHUSUDAN CHOWDHURY A.YR.2008-09 4 9. IN THE RESULT THE APPEAL OF THE REVENUE STANDS D ISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 25.03.2014. SD/- SD/- [SHAMIM YAHYA] [ GEORGE MATHAN ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE: 25.03.2014. R.G.(.P.S.) COPY OF THE ORDER FORWARDED TO: 1. SHRI MADHUSUDAN CHOWDHURY, 1/B, CONVENT ROAD, KOLKA TA-700014. 2 I.T.O. WARD-31(2), KOLKATA 3 . CIT(A)-XIX, KOLKATA. 4. CIT - KOLKATA. 5. CIT-DR, KOLKATA BENCHES, KOLKATA TRUE COPY, BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES