ITO, Kollam V. Sri.Babu jacob, Kollam

ITA 114/COCH/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 64787 (ITAT-COCHIN)
• Duration Of Justice: 1 year(s) 7 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-09-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 05-09-2012
• Assessment Year: 2003-2004
• Appeal Filed On: 11-02-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A S BINDHU
• Assessee Lawyers: IYPE MATHEW

Judgement Text

1 ITA NO.114/COCH/2011 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE SHRI N.R.S. GANESAN (JM) AND SHRI B.R. BASKARA N(AM) I.T.A NO. 114/COCH/2011 (ASSESSMENT YEAR 2007-08) ITO, WD.1 VS SHRI BABU JACOB KOLLAM MANJU AUTO SPARES BEACH ROAD, KOLLAM PAN : AJAPB7503N (APPELLANT) (RESPONDENT) APPELLANT BY : MS. A.S. BINDHU RESPONDENT BY : SHRI IYPE MATHEW DATE OF HEARING : 05-09-2012 DATE OF PRONOUNCEMENT : 14-09-2012 O R D E R PER N.R.S. GANESAN (JM) BEING AGGRIEVED BY THE ORDER OF COMMISSIONER OF IN COME-TAX(A), THE REVENUE IS IN APPEAL BEFORE THIS TRIBUNAL FOR THE A SSESSMENT YEAR 2007-08. 2. SMT. A.S. BINDHU, THE LD.DR SUBMITTED THAT THE A SSESSING OFFICER MADE ADDITION OF RS. 16,47,340 AS AGREED BY THE TAXPAYER IN THE COURSE OF ASSESSMENT PROCEEDINGS. THE LD.DR FURTHER SUBMITTED THAT THE TAXPAYER CONTENDED BEFORE THE COMMISSIONER OF INCOME-TAX(A) THAT HE HAS NOT AG REED FOR ANY ADDITION. THE LD.DR PRODUCED COPY OF THE ORDER SHEET ENTRY MADE B Y THE ASSESSING OFFICER AND SUBMITTED THAT THE ASSESSING OFFICER PROPOSED TO MA KE ADDITION OF RS. 16,47,340 2 ITA NO.114/COCH/2011 AND THE TAXPAYER HAS ALSO SIGNED THE SAME AS TOKEN O F ACCEPTANCE. THE LD.DR FURTHER SUBMITTED THAT THE ASSESSING OFFICER HAS AL SO PROPOSED TO MAKE ADDITION OF RS.1,73,439 FOR ASSESSMENT YEAR 2004-05; RS.1,88, 634 FOR ASSESSMENT YEAR 2005-06; AND RS.4,90,585 FOR ASSESSMENT YEAR 2006-07. THE TAXPAYER HAS ACCEPTED THIS PROPOSAL AS AGREED. HOWEVER, HE IS D ISPUTING THE ADDITION FOR ASSESSMENT YEAR 2007-08. THEREFORE, THE CONTENTION OF THE TAXPAYER THAT HE HAS NOT AGREED FOR THE ADDITION FOR THE ASSESSMENT YEAR 2007-08 IS NOT CORRECT. WHEN IT WAS POINTED OUT BY THE BENCH AFTER SHOWING THE COPY OF THE ORDER SHEET ENTRY THAT IT IS ONLY A PROPOSAL FOR MAKING ADDITION AND THERE IS NOTHING IN THE ORDER SHEET ENTRY TO INDICATE THAT THE TAXPAYER HAS AGREED FOR THE ADDITION, THE LD.DR SUBMITTED THAT IN FACT THE TAXPAYER HAD AGREE D FOR THE ADDITION. HOWEVER, THE ORDER SHEET ENTRY WAS NOT PROPERLY DRAFTED BY T HE ASSESSING OFFICER. MERELY BECAUSE THE ORDER SHEET ENTRY WAS NOT PROPERLY WORD ED AND DRAFTED THE TAXPAYER CANNOT TAKE ADVANTAGE OF THE SAME TO GO BACK FROM HIS CONSENT FOR MAKING ADDITION OF RS. 16,47,340 FOR THE ASSESSMENT YEAR 2 007-08 ALONE. THE LD.DR FURTHER POINTED OUT THAT THERE WAS ACCRUAL OF CAPIT AL WHICH WAS NOT PROPERLY EXPLAINED. THEREFORE, THE TAXPAYER ACCEPTED THE PR OPOSAL OF THE ASSESSING OFFICER. 3. ON THE CONTRARY, SHRI IYPE MATHEW, THE LD.REPRES ENTATIVE FOR THE TAXPAYER SUBMITTED THAT THERE IS NO ACCRUAL OF CAPITAL. THE LD.REPRESENTATIVE FURTHER SUBMITTED THAT THE ASSESSING OFFICER MADE A PROPOSA L TO MAKE ADDITION OF RS.25 LAKHS FOR THE ASSESSMENT YEARS 2004-05 TO 2007-08. IN THE PROPOSAL THE TAXPAYER HAS SIGNED THE NOTING MADE BY THE ASSESSING OFFICER IN THE ORDER SHEET AS TOKEN OF HIS PRESENCE. ACCORDING TO THE LD.REPRESENTATIVE, THE TAXPAYER NEVER AGREED FOR ADDITION AS PROPOSED BY THE ASSESSING OFFICER WHICH WAS ONLY A PROPOSAL OF THE ASSESSING OFFICER HIMSELF. THE TAXPAYER AFFIXED HI S SIGNATURE AT THE REQUEST OF THE 3 ITA NO.114/COCH/2011 ASSESSING OFFICER ONLY TO MARK HIS PRESENCE AND NOT FOR AGREEING WITH THE PROPOSAL MADE BY THE ASSESSING OFFICER. THEREFORE, AT NO ST RETCH OF IMAGINATION IT CAN BE TAKEN AS AN AGREEMENT FOR MAKING THE PROPOSED ADDITIO N BY THE ASSESSING OFFICER. FOR THE ASSESSMENT YEARS 2004-05 TO 2006-07 THE TAX P AYER HAS NOT CHALLENGED THE ADDITION MADE BY THE ASSESSING OFFICER IN ORDER TO AVOID LITIGATION. MERE NON FILING OF APPEAL FOR ASSESSMENT YEARS 2004-05 TO 200 6-07 CANNOT BE VIEWED AGAINST THE TAXPAYER WHEN NOTHING IS ON RECORD TO I NDICATE THAT THE TAXPAYER HAS AGREED FOR THE ADDITION. THEREFORE, ACCORDING TO T HE LD.REPRESENTATIVE, THE COMMISSIONER OF INCOME-TAX(A) HAS RIGHTLY DELETED TH E ADDITION. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND ALS O PERUSED THE MATERIAL AVAILABLE ON RECORD. THE CONTENTION OF THE DEPARTM ENT IS THAT THERE WAS ACCRUAL TO THE CAPITAL AND THE TAXPAYER AGREED FOR ADDITION OF RS. 16,47,340 FOR THE ASSESSMENT YEAR 2007-08. ON VERIFICATION OF THE ORD ER SHEET ENTRY MADE BY THE ASSESSING OFFICER IT IS OBVIOUS THAT IT IS A PROPOS AL OF THE ASSESSING OFFICER TO MAKE ADDITION. NO DOUBT, THE TAXPAYER HAS ALSO AFFIXED HIS SIGNATURE IN THE ORDER SHEET ENTRY MADE BY THE ASSESSING OFFICER WHERE HE PROPOS ED TO MAKE THE ADDITION. ON PERUSAL OF THE ORDER SHEET ENTRY THERE IS NOTHING T O INDICATE THAT THE TAXPAYER HAS AGREED FOR THE PROPOSAL MADE BY THE ASSESSING OFFIC ER. AT THE BEST, WE MAY SAY THAT THE PROPOSAL MADE BY THE ASSESSING OFFICER WAS BROUGHT TO THE NOTICE OF THE TAXPAYER. IT DOES NOT MEAN THAT THE TAXPAYER HAS I N ANY WAY AGREED FOR THE ADDITION. IF THE TAXPAYER HAD AGREED FOR THE ADDIT ION NOTHING WOULD HAVE PREVENTED THE ASSESSING OFFICER IN SAYING SO IN THE ORDER SHEET ENTRY MADE TO THAT EFFECT. UNFORTUNATELY, THE ASSESSING OFFICER HAS N OT STATED ANYTHING TO INDICATE THAT THE TAXPAYER HAD NO OBJECTION FOR THE PROPOSED ADDITION OR HE HAD AGREED FOR THE ADDITION. THE LD.DR HAS TAKEN PAIN TO EXPLA IN THAT MERELY BECAUSE THE ORDER SHEET ENTRY WAS NOT PROPERLY WORDED AND DRAFT ED, THE TAXPAYER CANNOT BE 4 ITA NO.114/COCH/2011 ALLOWED TO TAKE BENEFIT OUT OF SUCH ORDER. IT IS A CLEAR CASE OF PROPOSAL MADE BY THE TAXING AUTHORITY FOR ADDITION OF RS.16,47,340 W HICH WAS BROUGHT TO THE NOTICE OF THE TAXING AUTHORITY. THEREFORE, THIS TRIBUNAL IS OF THE OPINION THAT MERELY BECAUSE THE TAXPAYER AFFIXED HIS SIGNATURE IT CANNO T BE TAKEN AS AN AGREEMENT FOR THE ADDITION OF PROPOSED AMOUNT OF RS. 16,47,340. THERE IS NOTHING ON RECORD TO INDICATE THAT THERE IS ACCRUAL IN THE CAPITAL ACCOU NT. IN THESE FACTUAL CIRCUMSTANCES, THIS TRIBUNAL IS OF THE CONSIDERED O PINION THAT THE COMMISSIONER OF INCOME-TAX(A) HAS RIGHTLY DELETED THE ADDITION. WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LOWER AUTHORITY. ACCORDINGLY THE SAME IS CONFIRMED. 5. IN THE RESULT, APPEAL OF THE REVENUE STANDS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 14 TH SEPTEMBER, 2012. SD/- SD/- (B.R. BASKARAN) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER COCHIN, DT : 14 TH SEPTEMBER, 2012 PK/- COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE COMMISSIONER OF INCOME-TAX 4. THE COMMISSIONER OF INCOME-TAX(A) 5. THE DR (TRUE COPY) BY ORDER ASSTT. REGISTRAR, INCOME-TAX APPELLATE TRIBUNAL, COCHIN BENCH