ACIT, Cir-40, Kolkata, Kolkata V. Shri Saurabh Gupta, Kolkata

ITA 117/KOL/2014

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 8018 (ITAT-KOLKATA)
• Duration Of Justice: 5 year(s) 2 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-04-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2010-2011
• Appeal Filed On: 20-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SOURAV KUMAR CITSRDR
• Section: 143(3)

Judgement Text

, C , IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH C KOLKATA BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND DR. A.L. SAINI, ACCOUNTANT MEMBER ITA NO. 117 / KOL / 20 14 ASSESSMENT YEAR :2010-11 ACIT, CIRCLE-40, 18, RABINDRA SARANI, PODDER COURT, 4 TH FLOOR, KOLKAT-001 V/S . SHRI SAURABH GUPTA P-64B, CIT ROADD, GROUND FLOOR, SCHEME- VIM, KOLKATA-54 [ PAN NO.ADPPG 1118 F ] /APPELLANT .. / RESPONDENT /BY APPELLANT SHRI SOURAV KUMAR, ADDL. CIT-SR-DR /BY RESPONDENT NONE /DATE OF HEARING 14-01-2019 /DATE OF PRONOUNCEMENT 16-04-2019 / O R D E R PER S.S.GODARA, JUDICIAL MEMBER:- THIS REVENUES APPEAL FOR ASSESSMENT YEAR 2010-11 A RISES AGAINST THE COMMISSIONER OF INCOME TAX (APPEALS)-XII, KOLKATAS ORDER DATED 09.10.2013 PASSED IN CASE NO.72/XII/CIR-40/13-14, INVOLVING PR OCEEDINGS U/S 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. CASE CALLED TWICE. NONE APPEARS AT THE ASSESSEES B EHEST. WE PROCEED EX PARTE AGAINST THE ASSESSEE IN THE INSTANT APPEAL . 2. THE REVENUES FORMER SUBSTANTIVE GROUND CHALLENG ES CORRECTNESS OF THE CIT(A)S FINDING REVERSING ASSESSING OFFICERS ACTI ON REJECTING ASSESSEES BOOKS OF ACCOUNTS. ITS CASE IS THAT THE TAXPAYER HA D FAILED TO EXPLAIN ALL THE EVIDENCES / DOCUMENTS SUPPORTING ITS FALL IN GROSS PROFIT RATE ALONGWITH REASONABLE COSTS(S) OF OUTPUT, PRODUCTION AND CONSU MPTION OF THE RAW MATERIAL FOLLOWED BY NON-SATISFACTORY RESPONSE JUSTIFYING CO ST OF DEFECTIVE GOODS AND ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 2 CORRESPONDING SALES RETURN IN STOCK. ITS NEXT GROUN D SEEKS TO REVIVE THE ASSESSING OFFICERS ACTION DISALLOWING REPLACEMENT PROVISION OF 91,07,528/- AS DELETED IN THE LOWER APPELLATE PROCEEDINGS. WE D EEM IT APPROPRIATE TO REPRODUCE THE CIT(A)S DETAILED DISCUSSION ON BOTH THE ISSUE(S) AS FOLLOWS:- ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 3 ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 4 ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 5 ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 6 ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 7 ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 8 ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 9 ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 10 ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 11 ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 12 ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 13 ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 14 ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 15 ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 16 ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 17 ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 18 ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 19 LEARNED SENIOR DEPARTMENTAL REPRESENTATIVE VEHEMENT LY CONTENDS DURING THE COURSE OF HEARING THAT THE ASSESSING OFFICER HAD R IGHTLY REJECTED ASSESSEES BOOKS OF ACCOUNT AS HE HAD FAILED TO EXPLAIN DECLIN E ITS PROFIT RATE IN THE LIGHT INPUT, PRODUCTION AND CONSUMPTION OF RAW MATERIALS. WE FIND NO SUBSTANCE IN REVENUES INSTANT ARGUMENTS ON THE INSTANT FORMER I SSUE OF REJECTION OF BOOKS OF ACCOUNT. CASE FILE SUGGESTS THAT THE CIT(A) HAD SENT ASSESSEES RELEVANT DETAILS TO THE ASSESSING OFFICER REJECTING COMPARAT IVE INCREASE IN RAW MATERIAL PRICE IN FOREIGN CURRENCY, WITHOUT ANY TREND TO THI S EFFECT IN SALE PRICE OF THE EXPORTED GOODS. WE ALSO FIND THAT ASSESSEE HAD SUCC ESSFULLY PROVED ITS PURCHASE PAYMENTS ROUTED THROUGH BANLONG CHANNEL ON LY. THE REVENUE FAILS TO REBUT THE CRUCIAL FACT THAT THE TAXPAYERS SUBMI SSIONS IN ANNEXURE A-D SUFFICIENTLY INDICATED COMPARATIVE GROSS PROFIT RAT ES IN PRECEDING VIS--VIS THE IMPUGNED ASSESSMENT YEAR, PROFIT RATES OF EXPORT AN D DOMESTIC SALES, RAW MATERIAL PRICE UPWARD MOVEMENT AND AVAILABILITY OF ALL QUANTITATIVE DETAILS DURING THE COURSE OF ASSESSMENT. LEARNED DRS ARGUM ENT IS THAT THE ASSESSEE HAD FAILED TO EXPLAIN ITS CONTENTION WITH THE HELP OF SUPPORTIVE DOCUMENTARY EVIDENCE IS DEVOID OF MERIT THEREFORE. WE CONCLUDE IN THESE PECULIAR FACTS AND CIRCUMSTANCES THAT THE CIT(A) HA S RIGHTLY UPHELD ASSESSEES BOOKS OF ACCOUNT IN VIEW OF VARIOUS JUDICIAL PRECED ENT (SUPRA) GOVERNING THE ITA NO.117/KOL/2014 A.Y. 20 10-11 ACIT, CIR-40, KOL. VS. SHRI SAURABH G UPTA PAGE 20 FIELD AS WELL AS ALL THE RELEVANT SUPPORTIVE EVIDEN CE AS RECORD. THIS FORMER SUBSTANTIVE GROUND IS DECIDED IN ASSESSEES FAVOUR THEREFORE. 3. NEXT COMES THE REVENUES LATTER GRIEVANCE SEEKIN G TO REVIVE REPLACEMENT DISALLOWANCE PROVISION OF 91,907,528/-. WE MAKE IT CLEAR FIRST OF ALL THAT SUCH A WARRANTY CLAIM BASED ON ARISING FRO M POST LIABILITIES AND SCIENTIFIC ESTIMATION IS VERY MUCH ALLOWABLE AS PER HON'BLE APEX COURTS LANDMARK DECISION IN ROTORK CONTROLS CASE (SUPRA ). THE ASSESSEES DETAILS DULY CONSIDERED IN THE CIT(A)S FINDINGS MAKE IT CL EAR THAT HE HAD CLAIMED THE IMPUGNED PROVISION(S) BOTH IN PROCEEDING AND SUCCEE DING ASSESSMENT YEAR TO BE MUCH LESS THAN THAT ACTUALLY INCURRED (SUPRA). T HE ASSESSEE HAS FURTHER PLACED ON RECORD HIS CURRENT LEDGER MAINTAINED IN S UPPORT OF THE IMPUGNED REPLACEMENT CLAIM BY TAKING RECOURSE TO CREDIT NOTE S. ALL THESE CRUCIAL DETAILS HAVE NOWHERE BEEN REBUTTED EITHER DURING ASSESSMEN T OR IN THE INSTANT APPELLATE PROCEEDINGS. WE THUS SEE NO JUSTIFIABLE R EASON TO INTERFERE WITH THE CIT(A)S FINDING DELETING THE IMPUGNED DISALLOWANCE . 4. THIS REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT 16 /04/2019 SD/- SD/- ( %) (' %) (DR.A.L. SAINI) (S.S.GODARA) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) KOLKATA, *DKP, SR.P.S (- 16 / 04 /201 9 / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-ACIT, CIRCLE-40, 18, RABINDRA SARANI, PO DDAR COURT, 4 TH FL. KOL-001 2. /RESPONDENT-SHRI SAURABH GUPTA, P-64B, CIT ROAD, GR OUND FLOOR, SCHEME-VIM, KOLKATA-54 3. 3 4 / CONCERNED CIT KOLKATA 4. 4- / CIT (A) KOLKATA 5. 7 ''3, 3, / DR, ITAT, KOLKATA 6. < / GUARD FILE. BY ORDER/ , /TRUE COPY/ / 3,