M/s. Tayal Concast (P) Ltd., Muzaffarnagar V. ITO, Muzaffarnagar

ITA 1145/DEL/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 3663 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 8 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-11-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 10-05-2017
• Assessment Year: 2000-2001
• Appeal Filed On: 26-02-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIJAY VERMA
• Assessee Lawyers: AMIT KUMAR
• Keywords: Search and seizure; Reassessment proceedings
• Section: 143(3); 147; 145; 148

Judgement Text

PAGE | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D : NEW DELHI BEFORE SHRI H.S.SIDHU , JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO. 1145/DEL/2015 & ITA NO. 2039/DEL/2013 (ASSESSMENT YEAR: 2000 - 01) TAYAL CONCAST (P) LTD, C/O. PREM PRAKASH ADVOCATE, 183/2, NORTH CIVIL LINES, MUZAFFARNAGAR PAN:AABCT1327P VS. ITO, WARD - 2(4), MUZAFFARNAGAR (APPELLANT) (RESPONDENT) & ITA NO. 2039/DEL/2013 (ASSESSMENT YEAR: 2000 - 01) TAYAL CONCAST (P) LTD, C/O. PREM PRAKASH ADVOCATE, 183/2, NORTH CIVIL LINES, MUZAFFARNAGAR PAN:AABCT1327P VS. ITO, WARD - 2(3), MUZAFFARNAGAR (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI AMIT KUMAR, ADV REVENUE BY: SHRI VIJAY VERMA, CIT DR DATE OF HEARING 22/08 / 2017 DATE OF PRONOUNCEMENT 0 9 / 11 / 2017 O R D E R PER PRASHANT MAHARISHI , A. M. 1. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD CIT(A), MUZAFFARNAGAR DATED 29.12.2014 FOR THE ASSESSMENT YEAR 2000 - 01. 2. THE ASSESSEE HAS FILED THE FOLLOWING GROUNDS OF APPEAL IN ITA NO. 1145/DEL/ 2015 : - 1. THAT THE ORDER IS AGAINST LAW AND FACTS ON RECORD. 2. THAT THE LD CIT(A) WAS WRONG IN CONFIRMING THE PENALTY U/S 271(1)(C) WITHOUT CONSIDERING THE SUBMISSIONS MADE BY THE APPELLANT. 3. THAT LD CIT(A) WAS WRONG IN NOT CONSIDERING THE LEVY OF PENALTY WITHOUT POINTING OUT THE DEFAULTS FOR WHICH PENALTY U/S 271(1)(C) HAS BEEN IMPOSED I.E. WHETHER FOR CONCEALMENT OF INCOME OR FILING INACCURATE PARTICULARS OF INCOME OR OF BOTH. 4. THAT THE LD CIT(A) WAS WRONG IN NOT CONSIDERING VARIOUS RULINGS CITE D BY THE APPELLANT. 5. THAT THE LD CIT(A) WAS WRONG IN MENTIONING THAT EXCISE DEPTT HAS CONDUCTED RAID ON THE BUSINESS PREMISES AND TAX EVASION WAS DEDUCTED. TAYAL CONCAST (P) LTD, VS. ITO ITA NO. 1145/DEL/2015 AND 2039/DEL/201 3 AY 2000 - 01 3. THE BRIEF FACTS OF THE CASE IS THAT THE ASSESSEE IS A COMPANY ENGAGED IN THE MANUFACTURING AND SALE OF LOCAL CEMENT. IT FILED ITS RETURN OF INCOME ON 30.11.2000 SHOWING LOSS OF RS. 186000/ - . SUBSEQUENTLY, NOTICE U/S 148 OF THE ACT WAS ISSUED ON 14.01.2002. THE ASSESSEE FILED THE SAME RETURN OF INCOME ON 19.07.2002. THE ASSESSMENT U/S 143(3) READ WITH SECTION 147 WAS COMPLETED ON 20.03.2003 OF RS. 173718/ - . THEREAFTER, A TAX EVASION PETITION WAS RECEIVED ALONG WITH COPIES OF ACCOUNTS OF SEVERAL PARTIES TO WHOM TH E ASSESSEE HAS SOLD ITS PRODUCT FOR THE FY 1999 - 2000. IT WAS ALSO ALLEGED THAT CERTAIN EXPENSES HAVE BEEN MADE OUT OF THE BOOKS. THE AO FURTHER GET S THE INFORMATION FROM THE EXCISE DEPARTMENT THAT IT HAS ALSO TAKEN ACCOUNT ACTION AGAINST THE ASSESSEE FOR E VASION OF TAX. THE POLICE ALSO RAIDED THE FACTORY ON 12.09.2004 AND FILED AN FIR ON 13.09.2004 REGARDING MANUFACTURING AND SALE OF SPURIOUS CEMENT . HENCE, ONCE AGAIN NOTICE U/S 148 WAS ISSUED ON 15.01.2007 AND ASSESSMENT WAS COMPLETED ON 27/12/2007 OF RS. 1240730/ - . THE ASSESSEE CHALLENGED THE ASSESSMENT UPTO THE LEVEL OF COORDINATE BENCH WHO SET ASIDE THE WHOLE ISSUE BACK TO THE FILE OF LD CIT(A) WHO PASSED THE IMPUGNED ORDER ON 07.01.2013 DISMISSING THE APPEAL OF THE ASSESSEE. 4. THE LD A O HAS MADE AN ADDITI ON OF RS. 902037/ - WHEREIN GP RATE OF 21% WAS DETERMINED OF RS. 1986226/ - AGAINST THE GROSS PROFIT EARNED BY THE ASSESSEE OF RS. 1084190/ - . 5. THE LD AR SUBMITTED THAT GROSS PROFIT DECLARED BY THE ASSESSEE IS 18.16% AGAINST GP RATE 23.45% IN EARLIER YEAR. THE ASSESSEE FURTHER SUBMITTED THAT ACCORDING TO TEP PAPERS THE SALE IS RS. 953490/ - WHEREAS THE LD AO HAS TAKEN IT AT RS. 1232670/ - . THIS ARGUMENT W AS REJECTED BY THE LD CIT(A) WITHOUT ANY VALID REASON. HE FURTHER STATED THAT AT THE TIME OF RECORDING HIS SUBMISSION THE AO SUPPLIE D PHOTO COPIES OF 24 PAGES WHICH DID NOT BEAR THE SIGNATURE OF THE OFFICERS. FURTHER THESE PAPERS ALSO DO NOT HAVE THE NAME OF THE ASSESSEE. HE FURTHER STATED THAT THERE WAS NO NARRATION OF SALES. IN VIEW OF THIS HE SUBMITTED THAT ADDITION HAS BEEN MADE BY THE LD AO WITHOUT ANY PROPER OPPORTUNITY GIVEN TO THE ASSESSEE. HE FURTHER STATED THAT THE INFORMATION WAS RECEIVED FROM TH E CENTRAL EXCISE DEPARTMENT WHICH WAS NOT SUFFICIENT FOR REOPENING OF THE ASSESSMENT. HE FURTHER STATED THAT THE LD CIT(A) HAS BRUSHED ASIDE ALL THE OBJECTIONS RAISED BY THE ASSESSEE WITHOUT ASSIGNING ANY COGENT REASON. WITH RESPECT TO THE ESTIMATE OF 21% OF THE NET PROFIT IT WAS SUBMITTED THAT THE ASSESSEE HAS ALREADY SURRENDERED CERTAIN AMOUNT S AND AO HAS ALSO NOT CONSIDERED THE COMPARATIVE CHART OF GROSS PROFIT FOR THE LAST TWO YEARS. TAYAL CONCAST (P) LTD, VS. ITO ITA NO. 1145/DEL/2015 AND 2039/DEL/201 3 AY 2000 - 01 HE SUBMITTED THAT CREDIT FOR ALREADY SURRENDERED AMOUNT SHOULD HAVE BE EN GIVEN TO THE ASSESSEE. HE FURTHER RELIED UPON THE SEVERAL CASE LAWS. 6. THE LD DR VEHEMENTLY CONTESTED THE SUBMISSION OF THE ASSESSEE AND THEREFORE, THE ORDER OF THE LD CIT(A) MAY BE UPHELD. 7. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS AS WELL AS P ERUSED THE ORDER OF THE LD CIT(A) WHO HAS CONFIRMED THE ADDITION OF RS. 902037/ - . THE LD AO HAS TAKEN SALES OF RS. 9458225/ - AS PER ORDER OF DCIT DATED 27.12.2007 AND APPLIED THE GP RATE OF 21% THEREON FOR MAKING THE ABOVE ADDITION. BEFORE THE LD CIT(A) AS SESSEE HAS RAISED VARIOUS ARGUMENTS WHICH ARE AT PAGE NO. 24 TO 25 OF THE ORDER OF THE LD CIT(A). ASSESSEE HAS ALSO CHALLENGED VALIDITY OF THE REASSESSMENT PROCEEDINGS BEFORE HIM WHICH WAS NOT CONSIDERED BY LD CIT(A) BUT BRUSHED ASIDE AND REJECTED. FURTHER MORE, REOPENING ON THE BASIS OF REPORT OF CENTRAL EXCISE AUTHORITIES AS WELL AS ON THE BASIS OF TEP, MADE BY THE LD AO IS ALSO CHALLENGED BY THE ASSESSEE WHICH WAS NOT MET WITH REASONS. FURTHERMORE, BEFORE US THE LD AUTHORISED REPRESENTATIVE HAS SUBMITTED THAT ON IDENTI CA L FACTS AND CIRCUMSTANCES IN ASSESSEES OWN CASE FOR AY 2005 - 06 WHERE SIMILAR ALLEGATIONS WERE LEVELED THE COORDINATE BENCH HAS DECIDED THE ISSUE IN ITA NO. 2107/DEL/2013 AND ALLOWED THE APPEAL OF THE ASSESSEE FOR AY 2000 - 01. IN THAT PARTI CULAR APPEAL THE COORDINATE BENCH HAS CONSIDERED THE ALLEGATION OF SALE OF SPURIOUS CEMENT AND DETERMINATION OF PROFIT THEREON. THE COORDINATE BENCH HAS ALSO CONSIDERED THE REJECTION OF THE BOOKS OF ACCOUNT U/S 145 OF THE ACT FOR THAT ASSESSMENT YEAR. THE NON AFFORDING OF THE OPPORTUNITY TO THE ASSESSEE WAS ALSO CONSIDERED. IN VIEW OF THIS WE SET ASIDE ITA NO. 2039/DEL/2015 FOR ASSESSMENT YEAR 2000 - 01 BACK TO THE FILE OF THE LD AO WITH A DIRECTION TO THE ASSESSEE TO FILE ITS ALL OBJECTIONS BEFORE THE LD AO ON MERITS OF THE ADDITION OF RS. 902037/ - . THE LD AO MAY CONSIDER THE SUBMISSI ON OF THE ASSESSEE ON MERITS OF THE CASE AND ALSO CONSIDER THE DECISION OF THE ITAT FOR AY 2005 - 06 IN ITS OWN CASE WHERE IT IS STATED THAT SIMILAR FACTS WERE EXISTED . IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 8. NOW IN ITA NO. 1115/DEL/2015 IS AGAINST THE PENALTY LEVIED BY THE AO OF RS. 347284/ - U/S 271(1)(C) OF THE ACT WHICH IS CONFIRMED BY THE LD CIT(A) VIDE ORDER DATED 29.12.2014 AND AGAINST WHICH THE ASSESSEE IS IN APPEAL BEFORE US. AS THE QUANTUM APPEAL HAS ALREADY BEE N SET ASIDE TO THE FILE OF THE LD AO THIS APPEAL IS ALSO DIRECTED TO BE RECONSIDER BY THE LD AO ON MERITS OF THE CASE AFTER FINALIZING THE ASSESSMENT WHICH HAS BEEN SET ASIDE TO HIM. IN VIEW OF THIS APPEAL IS ALSO ALLOWED FOR STATISTICAL PURPOSES. TAYAL CONCAST (P) LTD, VS. ITO ITA NO. 1145/DEL/2015 AND 2039/DEL/201 3 AY 2000 - 01 9. IN THE RESULT BOTH THE APPEALS OF THE ASSESSEE ON QUANTUM AS WELL AS ON PENALTY ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 09 / 11 / 2017 . - SD/ - - SD/ - ( H.S.SIDHU ) (PRASHANT MAHARISHI) JUDICIAL MEMBE R ACCOUNTANT MEMBER DATED: 09 / 11 / 2017 A K KEOTA COPY FORWARDED TO 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI