Rajiv Shishir Nagar , Howrah V. ITO, Ward - 46(3), Kolkata , Kolkata

ITA 1085/KOL/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 6703 (ITAT-KOLKATA)
• Duration Of Justice: 8 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 22-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BAIGNATH SINGH
• Keywords: Question of law
• Section: 40A(3); 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH SMC KOLKATA BEFORE SHRI S.S, GODARA, JUDICIAL MEMBER ITA NO.1085/KOL/2018 ASSESSMENT YEAR:2012-13 RAJIV SHISHIR NAGAR 62/5, GURU KRIPA, ATINDRA MUKHERJEE LANE, SHIBPUR,HOWRAH-711102 [ PAN NO.ACDPN 9187 A ] / V/S . INCOME TAX OFFICER, WARD-46(3), 3 GOVT. PLACE, KOLKATA-700001 /APPELLANT .. /RESPONDENT /BY APPELLANT NONE /BY RESPONDENT SHRI BAIGNATH SINGH, ADDL CIT-DR /DATE OF HEARING 02-01-2019 /DATE OF PRONOUNCEMENT 23-01-2019 /O R D E R THIS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2012-13, ARISES AGAINST THE COMMISSIONER OF INCOME-TAX (APPEALS)-14, KOLKATAS ORDER DATED 23.02.2018 PASSED IN CASE NO.85/CIA-14/WD-48(1)/2015-16 INVOLV ING PROCEEDINGS U/S. 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE A CT. CASE CALLED TWICE. NONE APPEARS AT ASSESSEES BEHES T. HE IS THEREFORE PROCEEDED EX PARTE . 2. THE ASSESSEE SOLE SUBSTANTIVE GROUND CHALLENGES BOTH THE LOWER AUTHORITIES ACTION INVOKING SEC. 40A(3) DISALLOWAN CE OF CARRIAGE, FREIGHT AND TRAVELLING EXPENSES OF 12,91,444/- ON ACCOUNT OF CASH PAYMENT MADE IN A SINGLE DAY. MR. SINGH STRONGLY SUPPORTS THE IMPUGN ED DISALLOWANCE ON THE ITA NO.1085/KOL/2018 A.Y.2012-13 RAJIV SHISHIR NAGAR VS. ITO WD-46(3), K OL. PAGE 2 GROUND THAT ASSESSEE COULD NOT PROVE THE RELEVANT F ACTS AND CIRCUMSTANCES FORMING REASON OF THE IMPUGNED CASH PAYMENT. HE FAI LS TO DISPUTE THAT BOTH THE LOWER AUTHORITIES HAVE NOWHERE DOUBTED GENUINENESS OF THE IMPUGNED EXPENDITURE. HON'BLE JURISDICTIONAL HIGH COURTS JU DGMENT IN CIT VS. CRESCENT EXPORT SYNDICATE IN ITA NO.202 OF 2008 DECIDED ON 30.07.2008 READS A S UNDER:- THE LEARNED COUNSEL APPEARING FOR THE APPELLANT AR GUED THAT THE ASSESSEE IS 100% EXPORT ORIENTED FIRM, EXPORTING LE ATHER GOODS VIZ. WALLETS AND DIFFERENT TYPES OF BAGS. THE TOTAL EXPO RT TURNOVER DURING THE YEAR (FOB VALUE) RS.19,81,73,720/- AND PURCHASES SH OWN AT RS.11,65,97,523/. OUT OF THE SAID PURCHASE, THE PUR CHASE FROM 15 PARTIES AMOUNTING TO R.83,44,822/- AND THE SELLER COULD NOT BE PRODUCED IN ASSESSMENT, HENCE THE AO DISALLOWED THE ENTIRE PURC HASE AND ADDED RS.83,44,822/-. IN APPEAL, BEFORE THE LD. CIT(A)-XI X, KOLKATA THE APPELLANT SUBMITTED THAT IT MAINTAINS STOCK BOOK IN VENTORISED THE PURCHASE OF LEATHER, LEATHER ISSUED FOR CUTTING, AN D ISSUED TO FABRICATOR FINALLY FOR FINISHING THE GOODS AS PER EXPORT ORDER . THE LD. CIT(A) DIRECTED THE A O TO EXAMINE THOSE BOOKS AND TO SUB MIT THE REMAND REPORT. IN THE REMAND REPORT THE AO HAS ADMITTED ON VERIFICATION FOR THE PURCHASE DETAILS, IT IS SEEN THAT THE PURCHASES AMO UNTING TO RS.83,44,822/- MADE FROM DIFFERENT PARTIES ARE ENTE RED IN THE TOCK REGISTER AND PUT TO THE VARIOUS STAGES OF MANUFACTU RING PROCESS. THE ASSESSEE ALSO PRODUCED BILLS IN RESPECT OF ALL PURC HASE MADE FROM THESE 15 PARTIES AND FINALLY THE LD. CIT(A) HAS HELD AS R EGARDS THE PURCHASE, IT IS SEEN THAT THESE WERE RECORDED IN THE TOCK REGIST ER, THEIR CONSUMPTION IS ALSO RECORDED THEREIN, UP TO THE STAGE OF FINAL PRO DUCTION. ALL THESE RECORDS ARE AUDITED. THEY ARE PRODUCED BEFORE THE A SSESSING OFFICER FOR EXAMINATION WHO HAD NOT BEEN ABLE TO PRINT OUT ANY DEFECT IN IT. UNDER THE CIRCUMSTANCES THE PURCHASES ARE CONSIDERED TO B E GENUINE. SO THE PURCHASES HAVE BEEN HELD TO BE GENUINE. IT ALSO APP EARS THATS THE PURCHASES HAVE BEEN HELD TO BE GENUINE BY THE LEARN ED CIT (APPEAL) BUT THE LEARNED CIT (APPEAL) HAS INVOKED SECTION 40A(3) FOR PAYMENT EXCEEDING RS.20,000/- SINCE IT IS NOT MADE BY CROSS ED CHEQUE OR BANK DRAFT BUT BY HEARER CHEQUES AND HAS COMPUTED THE PA YMENTS FALLING UNDER PROVISIONS TO SECTION 40A(3) FOR RS78,45,580/- AND DISALLOWED @ 20% THEREON RS.15,69,116/-. IT IS ALSO MADE CLEAR THAT WITHOUT THE PAYMENT BEING MADE BY BEARER CHEQUE THEE GOODS COULD NOT HA VE BEEN PROCURED AND IT WOULD HAVE HAMPERED THE SUPPLY OF GOODS WITH IN THE STIPULATED TIME. THEREFORE, THE GENUINENESS OF THE PURCHASE HA S BEEN ACCEPTED BY THE LD. CIT (APPEAL) WHICH HAS ALSO NOT BEEN DISPUT ED BY THE DEPARTMENT ITA NO.1085/KOL/2018 A.Y.2012-13 RAJIV SHISHIR NAGAR VS. ITO WD-46(3), K OL. PAGE 3 AS IT APPEARS FROM THE ORDER SO PASSED BY THE LEARN ED TRIBUNAL. IT FURTHER APPEAR FROM THE ASSESSMENT ORDER THAT NEITHER THE A SSESSING OFFICER NOR HE CIT (PL) HAS DISBELIEVED THE GENUINENESS OF THE AN. THERE WAS NO DISPUTE THAT THE PURCHASE WERE GENUINE. ACCORDINGLY, IN OUR OPINION, THE LEARNED TRIBUNAL H AS CORRECTLY CAME TO THE CONCLUSION BY DELETING THE ADDITION OF RS.15,69 ,116/- UNDER SECTION 40A(3) OF THE ACT. ON THE OTHER GROUND AS IT APPEAR S THAT THE CIT(APPEAL) HAS BEEN DIRECTED TO RECONSIDER THE MATTER. IN VIEW OF THAT WE DO NOT THINK THAT ANY SUBSTANTIAL QUESTION OF LAW IS INVOLVED IN THIS MATTER. HENCE, THE APPEAL BEING ITA NO.202 OF 2008 IS DISMISSED. I ADOPT THE ABOVE DETAILED REASONING MUTATIS MUTANDIS TO DELETE THE IMPUGNED DISALLOWANCE. 3. THIS ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 23/01/2019 SD/- (S.S. GODARA) JUDICIAL MEMBE R KOLKATA, *DKP/SR.PS - 23/01/2019 / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT-RAJIV SHISHIR NAGAR, 62/5, GURU KRIPA, AT INDRA MUKHERJEE LANE, SH IBPUR, HOWRAH-711102 2. /RESPONDENT-ITO WARD-46(3), 3 NO/GOVT. PLACE, KOLKA A-700001 3. # & / CONCERNED CIT 4. & - / CIT (A) 5. ' **# , # / DR, ITAT, KOLKATA 6. , / GUARD FILE. BY ORDER/ , /TRUE COPY/ / #,