M/s P.H. Collection, V. I.T.O.,

ITA 106/RAN/2013

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 0332 (ITAT-RANCHI)
• Duration Of Justice: 1 year(s) 10 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-10-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 16-12-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: CHOUDHARY ORAON
• Assessee Lawyers: S C ARYA
• Section: 133A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RANCHI CIRCUIT BENCH, RANCHI BEFORE SHRI N.S. SAINI, HONBLE ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN, HONBLE JUDICIAL MEMBER ITA NO. 106/RAN/2013 (ASST. YEAR : 2006-07) M/S. P.H. COLLECTION, DARI MOHALLA, DHANBAD. VS. ITO, WARD-II(1), DHANBAD. PAN NO. AAEFP 9227 G (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI S.C. ARYA ADV. DEPARTMENT BY : SHRI CHOUDHARY ORAON DR DATE OF HEARING : 27/10/2015. DATE OF PRONOUNCEMENT : 27/10/2015. O R D E R PER N.S. SAINI, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF COMMISSIONER OF INCOME TAX (APPEALS), DHANBAD, DATE D 02/09/2013. 2. GROUND NO.1 OF THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) IN SUSTAINING THE ADDITION OF RS.3,35,585/- ON ACCOUNT OF DIFFERENCE IN STOCK. 3 . FACTS OF THE CASE, IN BRIEF, ARE THAT A SURVEY UN DER SECTION 133A OF THE ACT WAS CARRIED OUT AT THE BUSINESS PREMISES OF THE ASSESSEE ON 06/10/2005. DURING THE COURSE OF SURVEY, THE STOCK FOUND AT THE BUSINESS PREMISES WAS INVENTORISED. THE STOCK INVE NTORISED BY THE SURVEY PARTY WAS RS. 32,72,119/- AT MRP. THE BOOK S TOCK OF THE ASSESSEE WAS FOUND RS. 21,80,574/-. THUS, THERE WA S A DIFFERENCE OF RS. 10,91,545/-. THE ASSESSEE SUBMITTED BEFORE THE ASSESSING OFFICER 2 ITA NO. 106/RAN/2013 THAT DISCOUNT ALLOWED TO THE CUSTOMERS VARIES FROM 10 TO 12% DEPENDING ON THE VOLUME OF PURCHASE, QUANTITY/GRADE OF CLOTH AND THEREFORE CLAIMED DEDUCTION OF RS. 4,70,015/- FROM THE STOCK FOUND DURING THE COURSE OF SEARCH. FURTHER, THE ASSESSEE CLAIMED THAT 3 TO 4% DISCOUNT WAS GIVEN ON DEFECTIVE GOODS TO THE CUSTO MERS AND CLAIMED DEDUCTION OF RS. 1,27,340/- FROM THE STOCK FOUND DURING THE COURSE OF SURVEY. THE ASSESSEE ALSO CLAIMED DEDUCT ION FOR LESSER AMOUNT RECEIVED FROM THE CUSTOMERS FROM TIME TO TIM E OF RS. 36,091/-. FURTHER, THE ASSESSEE ALSO CLAIMED DEDUCTION OF GRO SS PROFIT OF 14.2% WHICH AMOUNTING TO RS. 4,58,097/-. THUS, THE ASSES SEE RECONCILED THE DIFFERENCE OF RS. 10,91,544/-. THE ASSESSING OFFIC ER WAS NOT SATISFIED WITH REGARD TO THE EXPLANATION OF THE ASSESSEE FOR DISCOUNT ALLOWED TO THE CUSTOMERS OF 10 TO 12% AND DISCOUNT ALLOWED DUE TO DEFECTIVE IN GOODS OF 3 TO 4% AND THEREFORE, MADE THE ADDITION O F RS. 5,97,355/- TO THE INCOME OF THE ASSESSEE. 4. ON APPEAL, COMMISSIONER OF INCOME TAX (APPEALS) ES TIMATED THE DISCOUNT AT 8% OF THE MRP OF THE STOCK AT RS. 32,72 ,119/- WHICH WORKED OUT TO RS. 2,61,769/- AND ALLOWED RELIEF FOR THE SAME AND CONFIRMED THE BALANCE AMOUNT OF DISALLOWANCE OF RS. 3,35,585/-. 5. BEFORE US, THE AUTHORIZED REPRESENTATIVE OF THE AS SESSEE SUBMITTED THAT THE RESTRICTION OF THE DISALLOWANCE AT RS. 3,35,585/- BY THE COMMISSIONER OF INCOME TAX (APPEALS) IN PLACE O F RS. 5,97,355/- MADE BY THE ASSESSING OFFICER WAS NOT JUSTIFIED. O N A QUERY BY THE BENCH THAT WHAT IS THE BASIS FOR CLAIMING DISCOUNT OF 10 TO 12% GIVEN TO THE CUSTOMERS ON MRP AND DISCOUNT OF 3 TO 4% GIVEN TO THE CUSTOMERS FOR DEFECTIVE GOODS ON MRP, THE AUTHORIZED REPRESEN TATIVE OF THE ASSESSEE EXPRESSED HIS INABILITY TO PROVIDE ANY EVI DENCE OR MATERIAL FOR THE SAME. IN ABSENCE OF ANY EVIDENCE BEING BROUGHT ON RECORD TO SHOW THAT THE DISCOUNT OFFERED TO THE CUSTOMERS WAS MORE THAN 8% AS ESTIMATED BY THE COMMISSIONER OF INCOME TAX (APPEAL S), WE FIND NO GOOD REASON TO INTERFERE WITH THE ORDERS OF THE LOW ER AUTHORITIES WHICH IS CONFIRMED AND THE GROUND OF APPEAL OF THE ASSESS EE IS DISMISSED. 3 ITA NO. 106/RAN/2013 6 . THE OTHER GROUND OF APPEAL IS DIRECTED AGAINST TH E ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) IN CONFIRMING THE ADDITION OF RS.1,49,695/- ON THE GROUND OF SUPPRESSION OF SALE. 7 . WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE O RDERS OF THE LOWER AUTHORITIES AND THE MATERIALS AVAILABLE ON RE CORD. 8 . THE ASSESSING OFFICER OBSERVED THAT AS PER THE EX ERCISE BOOK PHC-2 IMPOUNDED DURING THE COURSE OF SURVEY, IT IS FOUND THAT PAGE NOS. 17 TO 53 CONTAINS THE TRANSACTION OF SALE FOR THE PERIOD 01/04/2005 TO 05/10/2005 WHICH WORKS OUT TO RS. 18,85,979/- WH EREAS AS PER THE TRADING ACCOUNT FURNISHED BY THE ASSESSEE, THE SALE FOR THIS PERIOD HAS BEEN DISCLOSED AT RS. 17,42,406/-. THUS, THE DIFFE RENCE OF RS.1,49,695/- COULD NOT BE RECONCILED BY THE ASSESS EE AND NO EXPLANATION COULD BE SUBMITTED. ACCORDINGLY, THE A SSESSING OFFICER MADE THE ADDITION FOR RS. 1,49,695/- TO THE INCOME OF THE ASSESSEE. ON APPEAL, THE COMMISSIONER OF INCOME TAX (APPEALS) CO NFIRMED THE ACTION OF THE ASSESSING OFFICER. 9. BEFORE US, THE AUTHORIZED REPRESENTATIVE OF THE ASS ESSEE ALSO COULD NOT RECONCILE THE DIFFERENCE OF RS. 1,49,695/ - IN SALES AS PER THE IMPOUNDED MATERIAL DURING SURVEY AND THE SALE AS PE R TRADING ACCOUNT OF THE ASSESSEE, HENCE, WE FIND NO GOOD REASON TO I NTERFERE WITH THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) W HICH IS CONFIRMED AND THE GROUND OF APPEAL OF THE ASSESSEE IS DISMISS ED. 10 . IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISS ED. ORDER PRONOUNCED IN THE COURT AT THE CLOSE OF THE H EARING ON TUESDAY, THE 27 TH DAY OF OCTOBER, 2015 AT RANCHI. SD/- SD/- (GEORGE MATHAN) (N.S.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 27 TH OCTOBER, 2015. 4 ITA NO. 106/RAN/2013 VR/- COPY TO: 1. THE ASSESSEE. 2. THE REVENUE. 3. THE CIT 4. THE CIT(A) 5. THE D.R. 6. GUARD FILE. BY ORDER ASSISTANT REGISTRAR I.T.A.T., RANCHI 5 ITA NO. 106/RAN/2013 DATE INITIAL ORIGINAL DICTATION PAD & DRAFT ARE ENCLOSED IN THE FILE 1. DRAFT DICTATED ON 27/10/2015 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 28/10/2015 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 28/10/2015 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 28/10/2015 JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 28/10/2015 SR.PS 6. DATE OF PRONOUNCEMENT 27/10/2015 SR.PS 7. FILE SENT TO THE BENCH CLERK 28/10/2015 SR.PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER