The ITO,Vapi Ward-3, Vapi V. M/s. Sagar Paper Box Industries, Vapi

ITA 1210/AHD/2011

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9556 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 1 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-05-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 14-05-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 25-04-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B L YADAV
• Assessee Lawyers: RAVI BOHRA
• Section: 133(6); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH AHMEDABAD BEFORE S/SHRI G. D. AGARWAL, VP AND RAJPAL YADAV, JM ITA NO.1210/AHD/2011 ASST. YEAR 2007-08 .INCOME-TAX OFFICER, VAPI WARD-3, VAPI. VS M/S SAGAR PAPER BOX INDUSTRIES, SHED NO.A2/27, 40 SHED AREA SILVASSA ROAD, VAPI. (APPELLANT) (RESPONDENT) PA NO. AAOFS4542D APPELLANT BY SHRI B. L. YADAV, SR.DR RESPONDENT BY SHRI RAVI BOHRA, AR DATE OF HEARING: 14-5-2015 DATE OF PRONOUNCEMENT: 29/5/2015 O R D E R PER SHRI RAJPAL YADAV, JUDICIAL MEMBER. REVENUE IS IN APPEAL BEFORE US AGAINST THE ORDER O F CIT(A) DATED 30 TH DECEMBER, 2010 FOR ASSESSMENT YEAR 2007-08. THE SOLITARY GRIEVANCE OF THE REVENUE IS THAT LD. CIT(A ) HAS ERRED IN DELETING THE ADDITION OF RS.23,55,565/- WHICH WAS A DDED BY THE AO WITH THE AID OF SECTION 68 ON ACCOUNT OF DIFFERENCE IN THE SUNDRY CREDITORS AVAILABLE IN THE BALANCE SHEET OF THE ASS ESSEE VIS--VIS THE CONFIRMATION GIVEN BY THE CREDITORS. ITA NO.1210/AHD/2011 ASST. YEAR 2007-08 2 2. BRIEF FACTS ARE THAT ASSESSEE HAS FILED ITS RETU RN OF INCOME ON 06/11/2007 DECLARING TOTAL INCOME OF RS.55,401/-. T HE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY ASSESSMENT AND N OTICE UNDER SECTION 143(2) OF THE I.T. ACT, 1961 WAS ISSUED AND SERVED UPON THE ASSESSEE ON 27/09/2008. ON SCRUTINY OF THE ACCOUNTS IT REVEALED THAT SUNDRY CREDITS OF RS.1,73,82,361/- ARE SHOWN IN TH E ACCOUNTS OF THE ASSESSEE. THE LD. AO HAD DIRECTED THE ASSESSEE TO F ILE CONFIRMATION ON BEHALF OF THE CREDITORS. IT APPEARS THAT THERE W AS A DEATH IN THE FAMILY OF THE PARTNERS AND, THEREFORE, THEY COULD N OT SUBMIT THE DETAILS IN THE GIVEN TIME. A REQUEST WAS MADE THAT AO SHOUL D USE HIS POWERS AVAILABLE UNDER SECTION 133(6) AND DIRECTLY CALL FO R CONFIRMATIONS FROM THE PARTIES. ACCORDING TO THE INFORMATION COLLECTED BY THE AO THERE IS A VARIATION IN THE AMOUNTS OUTSTANDING TOWARDS THE ASSESSEE. THE DETAILS NOTICED BY THE AO READ AS UNDER :- SL.NO. PARTY NAME AMOUNT AS PER BALANCE SHEET AMOUNT AS PER CONFIRMATION LETTERS DIFFERENCE AMOUNT 1. APNA PAPER MILLS PVT. LTD. 344,170 375,688 31,518 2 VAHID PAPER DISTRIBUTORS 280,000 730,000 450,000 3. R.A. SHAIKH PAPER MILLS PTD. 469,410 2,216,062 1,746,652 4. VAIBHAV PAPER BOARDS PVT. LTD. (TOTAL OF BOTH UNITS) 1,490,199 1,362,804 127,395 TOTAL 2,355,565 THE LD. AO IN THIS WAY MADE AN ADDITION OF RS.23,55 ,565/-. 3. ON APPEAL LD. FIRST APPELLATE AUTHORITY HAS DELE TED THE ADDITION BY OBSERVING AS UNDER :- ITA NO.1210/AHD/2011 ASST. YEAR 2007-08 3 5.4 DECISION: I HAVE CAREFULLY CONSIDERED THE SUB MISSIONS MADE BY THE LD. AR AND THE FINDINGS OF THE AO. THE DISPUTE OF NON-RECO NCILIATION OF THE CREDITORS AROUSED DUE TO THE PAUCITY OF TIME AND THE UNTIMELY DEATH OF THE FAMILY MEMBERS OF THE APPELLANT. THE AO IS ABSOLUTELY RIGHT THAT B OGUS CREDIT BALANCE CANNOT BE INCLUDED IN THE B/S. IT WAS THE DUTY OF THE APPELLA NT TO SUBMIT THE RECONCILIATION STATEMENTS BEFORE THE AO FOR HIS SATISFACTION WHICH IN THIS CASE THE APPELLANT FAILED TO DO. HOWEVER, DURING THE APPELLATE PROCEED INGS THE LD. AR SUBMITTED DETAIL RECONCILIATION WITH THE LEDGER A/C OF THOSE PARTIES. I HAVE PERUSED THOSE DETAILS AND SATISFIED THAT THE RECONCILIATION STATE MENTS APPEARS TO BE IN ORDER. THEREFORE, THE AO IS DIRECTED TO DELETE THE ADDITIO N MADE IN THIS GROUND. HENCE, THE APPEAL IN THIS GROUND IS ALLOWED. 4. WITH THE ASSISTANCE OF THE LD. REPRESENTATIVES W E HAVE GONE THROUGH THE RECORD CAREFULLY. IT EMERGES OUT THAT L D. CIT(A) HAS DELETED THE ADDITION ON THE GROUND THAT ASSESSEE HA S RECONCILED THE DIFFERENCES. FOR EXAMPLE THE MAJOR DIFFERENCE IS IN THE CASE OF R.A. SHAIKH PAPER MILL. AS PER THE BALANCE SHEET A CREDI T OF RS.4,69,410/- WAS SHOWN WHEREAS THIS PARTY HAS CONFIRMED THAT THE AMOUNT OF RS.22,16,062/- STANDS OUTSTANDING TOWARDS THE ASSES SEE. IN RECONCILIATION ASSESSEE POINTED OUT THAT A CHEQUE O F RS.11,64,163/- WAS ISSUED TO THIS PARTY WHICH WAS NOT ACCOUNTED FO R BY THIS PARTY. THE ASSESSEE FILED COPY OF THE BANK STATEMENT FOR R ECONCILIATION. IT WAS CONTENDED THAT PAYMENTS MADE IN PAST OF RS.5,82 ,489/- HAS NOT BEEN RECOGNIZED. IN THIS WAY ASSESSEE HAS RECONCILE D THE DIFFERENCE OF RS.17,46,652/-. IN SIMILAR WAY ASSESSEE HAS RECO NCILED THE DIFFERENCE IN OTHER ACCOUNTS. THE LD. FIRST APPELLA NT AUTHORITY HAS ITA NO.1210/AHD/2011 ASST. YEAR 2007-08 4 OBSERVED THAT THE AO DID NOT GRANT PROPER OPPORTUNI TY TO THE ASSESSEE. HE CALLED FOR THE DETAILS AT THE FAG-END OF DECEMBER, 2009. THE CONFIRMATION WAS RECEIVED BY HIM ON 28 TH DECEMBER, 2009. WITHOUT CONFRONTING THE ASSESSEE HE HAS USED THESE DETAILS. THEREFORE, THE LD. FIRST APPELLATE AUTHORITY HAS GO NE THROUGH THE DETAILS INCLUDING BANK STATEMENT ETC. AND THEREAFTER SATISF IED THAT THERE IS NO DIFFERENCE AS SUCH IN THE SUNDRY CREDITORS DETAILS. AFTER GOING THROUGH THE WELL REASONED FINDING OF THE FIRST APPELLATE AU THORITY, WE DO NOT SEE ANY REASON TO INTERFERE IN IT. THIS APPEAL OF T HE REVENUE IS DEVOID OF ANY MERIT, HENCE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT. ORDER PRONOUNCED IN THE OPEN COURT ON 29/5/2015 SD/- SD/- (G. D. AGARWAL) VICE PRESIDENT (RAJPAL YADAV) JUDICIAL MEMBER DATED 29/5/15 MAHATA/- ITA NO.1210/AHD/2011 ASST. YEAR 2007-08 5 COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) CONCERNED 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE BY ORDER DY. REGISTRAR, ITAT, AHMEDABAD 1. DATE OF DICTATION: 25/5/2015 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE T HE DICTATING MEMBER: 25/5/2015 OTHER MEMBER: 3. DATE ON WHICH APPROVED DRAFT COMES TO THE SR. P. S./P.S.: 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE TH E DICTATING MEMBER FOR PRONOUNCEMENT: __________ 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE S R. P.S./P.S.: 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK: 29/5/15 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK: 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER: 9. DATE OF DESPATCH OF THE ORDER: