DCIT CEN CIR 8(3), MUMBAI V. INTERNATIONAL GOLD CO., P.LTD, MUMBAI

ITA 1070/MUM/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 0241 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-02-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 02-03-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: OMI NINGSHEN
• Section: 143(3); 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL 'I' BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ITA NO.1070/MUM/2016 (ASSESSMENT YEAR: 2011-12) DCIT, CENTAL CIRCLE - 8(3) ROOM NO. 659, 6TH FLOOR AAYAKAR BHAVAN, M.K. ROAD MUMBAI 400020 VS. M/S. INTERNATI O NAL GOLD CO. PVT. LTD. G-48, GEMS AND JEWELLERY COMPLEX, SEEPS, ANDHERI (E) MUMBAI 400096 PAN AAACI2830H APPELLANT RESPONDENT APPELLANT BY: SHRI OMI NINGSHEN RESPONDENT BY: NONE DATE OF HEARING: 29.01.2018 DATE OF PRONOUNCEMENT: 14.02.2018 O R D E R PER RAJESH KUMAR, AM THIS APPEAL HAS BEEN FILED BY THE REVENUE AGAINST T HE ORDER OF THE CIT(A)-50, MUMBAI DATED 30.11.2015 FOR A.Y. 2011-12 . 2. THE ONLY GROUND TAKEN BY THE REVENUE IS AGAINST DEL ETION OF DISALLOWANCE OF LABOUR CHARGES OF ` 36,32,828/- BY CIT(A) WITHOUT APPRECIATING THE FACT THAT NOTICES ISSUED UNDER SEC TION 133(6) WERE RETURNED UNSERVED AND THE ASSESSEE DID NOT PROVIDE THE CORRECT ADDRESS NOR DID PRODUCE THE PARTIES FOR VERIFICATION. 3. AT THE OUTSET WE WOULD LIKE TO MENTION THAT NONE A PPEARED ON BEHALF OF THE ASSESSEE AT THE TIME OF HEARING NOR ANY APPL ICATION FOR ADJOURNMENT WAS RECEIVED FROM THE ASSESSEE. WE THEREFORE PROCEE D TO DISPOSE OFF THE APPEAL AFTER CONSIDERING THE MERIT AND HEARING THE LEARNED D.R. 4. THE BRIEF FACTS OF THE CASE ARE THAT DURING THE COU RSE OF ASSESSMENT PROCEEDINGS THE AO NOTICED THAT THE ASSESSEE HAS DE BITED VARIOUS EXPENSES ITA NO. 1070/MUM/2016 M/S. INTERNATIONAL GOLD CO. PVT. LTD. 2 IN THE PROFIT & LOSS ACCOUNT FOR WHICH DETAILS WERE CALLED FOR. UPON EXAMINATION OF THE SAID DETAILS THE AO ISSUED NOTIC E UNDER SECTION 133(6) TO VARIOUS PARTIES. HOWEVER, THE NOTICE IN RESPECT OF LABOUR CHARGES PAID TO SHRI SUNIT GHOSH OF ` 36,32,828/- WAS RETURNED UNSERVED. THEREAFTER THE AO ISSUED SHOW CAUSE NOTICE ON 28.02.2014 WHICH WAS REPLIED BY THE ASSESSEE VIDE LETTER DATED 07.03.2014 FILING VARIOU S DETAILS SUCH AS COPY OF LEDGER ACCOUNTS, LABOUR BILLS, BANK STATEMENT, EXTR ACT OF THE REGISTER SHOWING GATE PASS ISSUED TO SHRI SUNIT GHOSH AND TD S CERTIFICATE ISSUED TO SHRI SUNIT GHOSH AND TDS REMITTANCE TO GOVERNMEN T TREASURY. THE AO, HOWEVER, NOT CONVINCED WITH THE GENUINENESS OF SUCH EXPENSES ADDED THE SAME TO THE INCOME OF THE ASSESSEE BY TREATING THE SAME AS BOGUS AND NON-VERIFIABLE BY FRAMING THE ASSESSMENT UNDER SECT ION 143(3) VIDE ORDER DATED 29.03.2014 ASSESSING THE TOTAL LOSS AT ` 7,69,587 /-. 5. AGGRIEVED, ASSESSEE WENT IN APPEAL BEFORE THE CIT(A ). IN THE APPELLATE PROCEEDINGS THE CIT(A) ALLOWED THE APPEAL OF THE AS SESSEE BY OBSERVING THAT THE ONLY GROUND CITED BY THE AO FOR MAKING THE ADDITION WAS NON- SERVICE OF NOTICE. ACCORDING TO THE CIT(A) THE AO H AS NOT BROUGHT ON RECORD ANY COGENT EVIDENCE WHICH PROVES THAT THE MONEY PAI D TO SHRI SUNIT GHOSH AS LABOUR CHARGES WAS NOT GENUINE. THE LEARNED CIT( A) OBSERVED THAT BY FILING OF NECESSARY DOCUMENTS SUCH AS COPY OF LEDGE R ACCOUNTS, GATE PASS, BANK STATEMENT, CONVEYANCE PAYMENT AND PAN, ETC. TH E ASSESSEE HAS DISCHARGES ITS ONUS. HOWEVER, THE AO HAS NOT DONE A NY EXERCISE TO VERIFY THE SAID AMOUNT. THUS FINALLY THE CIT(A) OBSERVED T HAT THE ADDITION WAS BASED ON SUSPICION AND ACCORDINGLY ALLOWED THE APPE AL OF THE ASSESSEE. AGGRIEVED, REVENUE IS IN APPEAL BEFORE US. 6. WE HAVE HEARD THE LEARNED D.R. AND PERUSED THE REL EVANT DOCUMENTS PLACED BEFORE US. WE FIND THAT IN THIS CASE THE ASS ESSEE HAS DISCHARGED HIS ONUS BY PLACING THE EVIDENCES WHICH THE ASSESSEE HA S IN POSSESSION SUCH AS COPY OF THE LEDGER ACCOUNT, BANK STATEMENT, GATE PA SS ISSUED TO SHRI GHOSH, DETAILS OF TDS AND PAN, ETC. THUS THE PRIMARY ONUS OF THE ASSESSEE WAS DULY DISCHARGED. THE AO HAS NOT DONE ANYTHING TO VE RIFY SUCH PAYMENT OR NOTHING WAS BROUGHT ON RECORD TO PROVE THAT THE PAY MENT WAS BOGUS AND ITA NO. 1070/MUM/2016 M/S. INTERNATIONAL GOLD CO. PVT. LTD. 3 NON-GENUINE. UNDER THESE CIRCUMSTANCES WE ARE IN AG REEMENT WITH THE CONCLUSION DRAWN BY THE CIT(A) THAT THE DISALLOWANC E IS NOT JUSTIFIED. THUS, THE GROUND TAKEN BY THE REVENUE IS REJECTED. 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS D ISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 14 TH FEBRUARY, 2018. SD/ - SD/ - (MAHAVIR SINGH) (RAJESH KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 14 TH FEBRUARY, 2018 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) -50, MUMBAI 4. THE PR. CIT, CENTRAL-4, MUMBAI 5. THE DR, I BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.