ITO, Jaipur V. PUSHPA bHANDARI, Jaipur

ITA 1081/JPR/2010

• Counselvise Citation: 108123114 RSA 2010
• Duration Of Justice: 1 year(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-09-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 01-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D K MEENA
• Assessee Lawyers: B P MUNDRA
• Section: 133(6)

Judgement Text

1 ITA 1081-10 IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH B JAIPUR BEFORE SHRI R.K. GUPTA AND SHRI N.L. KALRA ITA NO. 1081/JP/2010 ASSTT. YEAR : 2007-08. THE INCOME-TAX OFFICER, VS. SMT. PUSHPA BHANDARI, WARD 6(1), 2/408, MALVIYA NAGAR, JAIPUR. JAIPUR. NOW 80 USHA COLONY, MALVIYA NAGAR, JAIPUR. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI D.K. MEENA RESPONDENT BY : SHRI B.P. MUNDRA DATE OF HEARING : 12.9.2011 DATE OF PRONOUNCEMENT : 16.9.2011. ORDER DATE OF ORDER : 16/09/2011. PER R.K. GUPTA, J.M. THIS IS AN APPEAL BY DEPARTMENT AGAINST THE ORDER OF LD. CIT (A) RELATING TO ASSESSMENT YEAR 2007-08. 2. THE DEPARTMENT IS OBJECTING IN DELETING THE ADDI TION OF RS. 2,96,737/- MADE ON ACCOUNT OF UNVERIFIABLE PURCHASES AND DELETING THE ADDITION OF RS. 26,50,295/- MADE ON ACCOUNT OF UNVERIFIABLE SUNDRY CREDITORS ADDED UNDE R SECTION 41(1)(A) BY THE AO. 3. BRIEF FACTS OF THE CASE ARE THAT DURING ASSESSME NT PROCEEDINGS THE AO NOTICED THAT ASSESSEE HAS MADE PURCHASES OF RS. 15,65,751/-. TH E AO FURTHER NOTED THAT PAYMENT TO VARIOUS PARTIES AMOUNTING TO RS. 2,96,737/- REMAINE D UNVERIFIABLE. THE ASSESSEE WAS 2 REQUIRED TO PRODUCE THOSE PARTIES FROM WHOM THE PUR CHASES HAVE BEEN MADE AND PAYMENTS REMAINED UNVERIFIABLE. SUMMON ISSUED UNDER SECTION 133(6) WERE RECEIVED BACK FROM NINE PARTIES AND OUT OF THESE PAYMENT M ADE TO VARIOUS FIVE PARTIES STATED TO BE OF RS. 2,96,737/-. THEREFORE, THE AO WAS OF THE VI EW THAT THE PURCHASES TO THIS EXTENT IS NOT GENUINE. ACCORDINGLY, HE MADE ADDITION OF RS. 2,96,737/- ON ACCOUNT OF UNVERIFIABLE PURCHASES. 4. THE AO ALSO NOTED THAT SUNDRY CREDITORS TO THE E XTENT OF RS. 26,80,295/- WAS SHOWN, THE ASSESSEE WAS REQUIRED TO PRODUCE SUNDRY CREDITORS. HOWEVER, THEY WERE NOT PRODUCED, THEREFORE, THE AO HELD THAT THEY ARE NOT GENUINE. ACCORDINGLY HE MADE ADDITION OF RS. 26,80,295/-. 5. THE LD. CIT (A) DELETED THE ADDITION OF RS. 2,96 ,737/- BY OBSERVING THAT ASSESSEE HAS SHOWN G.P. RATE OF 10.10% AGAINST 2.2% SHOWN IN EARLIER. IT WAS FURTHER NOTED THAT AO HIMSELF HAS NOT DOUBTED THESE PURCHASES. HOWEVE R, SINCE PAYMENT MADE TO THESE PARTIES REMAINED UNVERIFIABLE, THEREFORE, HE HAS DR AWN ADVERSE INFERENCE. HOWEVER, THE FACT IS THAT THE PAYMENTS WERE MADE TO THESE PARTIE S BY ACCOUNT PAYEE CHEQUE. ACCORDINGLY THE ADDITION WAS DELETED. HOWEVER, IT W AS MENTIONED BY LD. CIT (A) THAT SINCE IN COMPUTATION NO SEPARATE ADDITION HAS BEEN MADE OF THIS AMOUNT, THEREFORE, WHILE GIVING APPEAL EFFECT NO REDUCTION TO THIS EFFECT IS REQUIRED TO BE MADE. 6. THESE FINDINGS OF LD. CIT (A) REMAINED UNCONTROV ERTED, THEREFORE, WE SEE NO REASON TO INTERFERE WITH THE FINDING OF LD. CIT (A) . ACCORDINGLY WE CONFIRM THE ORDER OF LD. CIT (A) ON THIS ISSUE. 7. REGARDING ADDITION OF RS. 26,50,295/-, THE LD. C IT (A) NOTED THAT PAYMENTS TO ALL THESE PARTIES HAVE BEEN MADE ON A SUBSEQUENT DATE B Y ACCOUNT PAYEE CHEQUE. THEREFORE, 3 THIS IS NOT A CASE OF CESSION OF LIABILITY IN VIEW OF SECTION 41(1). IT WAS FURTHER NOTED BY LD. CIT (A) THAT ADDITION IN CASE OF SUNDRY CREDITO R CAN ONLY BE MADE WHILE COMPUTING TOTAL INCOME WHEN THERE IS A CASE OF ESTABLISHED AN D BUSINESS CESSION OF LIABILITY. SINCE THE PAYMENTS HAVE ALREADY BEEN MADE ON SUBSEQUENT D ATES, THEREFORE, THE LD. CIT (A) DELETED THIS ADDITION ALSO. 8. IN THE ABOVE FINDING OF LD. CIT (A), AGAIN WE SE E NO INFIRMITY. FINDINGS OF LD. CIST (A) REMAINED UNCONTROVERTED. ACCORDINGLY, WE CONFIRM THIS FINDING OF LD. CIT (A). 9. IN THE RESULT, APPEAL OF THE DEPARTMENT IS DISMI SSED. 10. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 16 .9.2011. SD/- SD/- ( N.L. KALRA ) ( R.K. GUPTA ) ACCOUNTANT MEMBER JUDICIAL MEMBER JAIPUR, D/- COPY FORWARDED TO :- THE ITO WARD 6(1), JAIPUR. SMT. PUSHPA BHANDARI, JAIPUR. THE CIT (A) THE CIT THE D/R GUARD FILE (ITA NO. 1081/JP/2010) BY ORDER, AR ITAT JAIPUR.