M/s. Suntex Indl.Pvt.Ltd., Surat V. The ACIT., Cent.Circle-3, Surat

ITA 1219/AHD/2011

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 9312 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 9 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-02-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 21-01-2016
• Assessment Year: 2002-2003
• Appeal Filed On: 25-04-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SONIA KUMAR

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD , , BEFORE SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER AND SHRI KUL BHARAT, JUDICIAL MEMBER ./ I.T.A. NO.1219/AHD/2011 ( / ASSESSMENT YEAR : 2002-03) SUNTEX INDUSTRIES PVT.LTD. C/O. SURESH CHUGH 302, ARIHANT PARK OPP. PRATISHTHA COMPLEX HOTEL GATEWAY ROAD PARLE POINT, SURAT (GUJ) / VS. THE ACIT CIRCLE-3 SURAT ' ./ ./ PAN/GIR NO. : AADCS 4400 N ( '% / APPELLANT ) .. ( &''% / RESPONDENT ) '% ( / APPELLANT BY : SHRI HARDIK VORA, AR &''% ) ( / RESPONDENT BY : SMT. SONIA KUMAR, SR.DR * ) / DATE OF HEARING 21/01/2016 +,-. ) / DATE OF PRONOUNCEMENT 16/02/2016 / O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE LD.COMMISSIONER OF INCOME TAX(APPEALS)-II, AHMEDABA D [CIT(A) IN SHORT] DATED 09/11/2010 PERTAINING TO ASSESSMENT Y EAR (AY) 2002-03. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF AP PEAL:- ITA NO.1219/AHD /2011 SUNTEX INDUSTRIES PVT.LTD. VS. ACIT ASST.YEAR 2002-03 - 2 - 1. AS REGARDS ADDITION OF RS.8,27,580/- CONSIDERED AS UNACCOUNTED PURCHASES. 1.1. THE LD CIT(A) HAD ERRED ON THE FACTS OF THE CASE I N DISALLOWING THE PURCHASES WHICH HAS NEITHER BEEN RE CORDED NOR PAID BY THE ASSESSEE AS THE MATERIAL WAS REJECT ED AND KEPT SEPARATELY. 2. THE ASSESSEE CRAVES LEAVE TO ADD, AMEND, MODIFY AL TER OR DELETE ANY F THE GROUNDS AT THE TIME OF HEARING. 2. THE ONLY EFFECTIVE GROUND IS AGAINST CONFIRMING THE ADDITION OF RS.8,27,580/- WHICH IS CONSIDERED AS UNACCOUNTED PU RCHASES. 3. BRIEFLY STATED FACTS ARE THAT THIS IS SECOND ROU ND OF LITIGATION. IN EARLIER ROUND OF LITIGATION, THE MATTER TRAVELLED U PTO THE ITAT AND THE TRIBUNAL WAS PLEASED TO RESTORE THE ISSUE TO THE FI LE OF ASSESSING OFFICER (AO IN SHORT) WITH DIRECTION TO RECORD THE COMPLET E FACTS AFTER VERIFYING THE RELEVANT MATERIAL AND EVIDENCE AND DECIDE THE M ATTER IN ACCORDANCE WITH LAW AFTER PROVIDING REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. THE AO YET AGAIN SUSTAINED THE ADDITION. THE ASSESSEE BEING AGGRIEVED BY THE SAID ORDER, PREFERRED AN APPEAL BE FORE THE LD.CIT(A), WHO AFTER CONSIDERING THE MATERIAL AVAILABLE ON REC ORD, DISMISSED THE APPEAL. AGGRIEVED BY THE ORDER OF THE LD.CIT(A), T HE ASSESSEE IS NOW IN APPEAL BEFORE US. ITA NO.1219/AHD /2011 SUNTEX INDUSTRIES PVT.LTD. VS. ACIT ASST.YEAR 2002-03 - 3 - 4. THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT T HE AUTHORITIES BELOW WERE NOT JUSTIFIED IN DELETING THE ADDITION. HE SU BMITTED THAT IN THE EARLIER ROUND OF LITIGATION, THE COMMISSIONER HAD G IVEN RELIEF TO THE ASSESSEE ON THE BASIS OF CONFIRMATION LETTER DATED 31/03/2005 ISSUED BY THE SUPPLIER. HE SUBMITTED THAT DEFECTIVE MATERI AL WAS SUPPLIED TO THE ASSESSEE AND ON ACCOUNT OF DEFECTS INTO THE MATERIA L, THE PAYMENT TO SUCH MATERIAL GOODS WAS NOT RECORDED IN THE ACCOUNTS OF THE ASSESSEE. HE SUBMITTED THAT THERE IS NO LOSS TO THE REVENUE AND IT IS NOT THE CASE WHERE THE PURCHASES HAVE BEEN MADE OUT OF BOOKS OF THE AS SESSEE. HE SUBMITTED THAT THE DISPUTE RELATED TO THE QUALITY O F THE MATERIAL CULMINATED INTO THE PROCEEDINGS BEFORE THE HONBLE JURISDICTIONAL HIGH COURT. 4.1. ON THE CONTRARY, THE LD.SR.DR SMT.SONIA KUMAR SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE LD.COUNSEL FOR THE ASSESSEE HAS DRAWN OUR ATTEN TION TOWARDS THE LETTER DATED 31/03/2005, WHEREIN THE SUPPLIER HAS CONFIRME D THE TRANSACTION AS RECORDED BY THE AO IN HIS ASSESSMENT ORDER AT PARA- 9. IT IS STATED BY THE SUPPLIER THAT THE CUSTOMER, I.E. ASSESSEE HAD RAISE D DISPUTE WITH REGARD TO QUALITY AND TILL 31/03/2005 MATTER WAS NOT RESOLVED . WE FIND BEFORE THE ITA NO.1219/AHD /2011 SUNTEX INDUSTRIES PVT.LTD. VS. ACIT ASST.YEAR 2002-03 - 4 - LD.CIT(A) IT WAS STATED BY THE ASSESSEE THAT IN THE FINANCIAL YEAR (FY) 2006-07, 50% OF THE AMOUNT HAS BEEN PAID TO M/S.SAA HIL ORGANICS PVT.LTD. ON ACCOUNT OF SETTLEMENT AS PER THE VERDIC T OF THE HONBLE JURISDICTIONAL HIGH COURT. THE LD.CIT(A) HAS REC ORDED THAT IN SUPPORT OF SUCH CONTENTION, NO EVIDENCE WAS PLACED ON RECOR D. BEFORE THIS TRIBUNAL ALSO, NO EVIDENCE HAS BEEN PLACED, EVEN TH ERE WAS A DISPUTE PENDING BEFORE THE HONBLE JURISDICTIONAL CIVIL COU RT. HOWEVER, THERE IS NO DISPUTE WITH REGARD TO THE FACT THAT THE ASSESSE E HAS PLACED A LETTER DATED 31/03/2005 ISSUED FROM SAAHIL ORGANICS PVT.LT D. THE AO HAS NOT MADE ANY ENQUIRY IN THIS REGARD FROM M/S.SAAHIL ORG ANICS PVT.LTD. IT IS A SETTLED POSITION OF LAW THAT ANY CLAIM MADE BY TH E ASSESSEE WITH REGARD TO PURCHASE, THE SAME IS TO BE PROVED BY FURNISHING THE MATERIAL EVIDENCE. IN THE CASE IN HAND, THERE IS NO DISPUTE WITH REGAR D TO THE FACT THAT THE ASSESSEE HAS STATED BEFORE THE AUTHORITIES BELOW TH AT THE AMOUNT HAS BEEN PAID TO SUPPLIER IN PURSUANCE TO THE SETTLEMENT. THIS FACT IS NOT DISPUTED BY THE ASSESSEE AND ADMITTEDLY THE TRANSACTION RELA TES TO ASSESSMENT YEAR 2002-03. UNDER THESE FACTS, THE AMOUNT SO SETTLED TO BE TREATED AS PURCHASES OUTSIDE THE BOOKS. THEREFORE, WE DIRECT THE AO TO DELETE ADDITION OF RS.4,13,790/- AND BALANCE ADDITION OF R S.4,13,790/- AS THE ASSESSEE GROSSLY FAILED TO RECORD THE PURCHASES IN ITS BOOKS OF ACCOUNT. THUS, THIS GROUND OF ASSESSEES APPEAL IS PARTLY AL LOWED AS DISCUSSED HEREINBEFORE. ITA NO.1219/AHD /2011 SUNTEX INDUSTRIES PVT.LTD. VS. ACIT ASST.YEAR 2002-03 - 5 - 6. IN THE RESULT, ASSESSEES APPEAL IS PARTLY ALLOW ED. ORDER PRONOUNCED IN THE COURT ON TUESDAY, THE 16 TH DAY OF FEBRUARY, 2016 AT AHMEDABAD. SD/- SD/- ( ) ( ) ( ANIL CHATURVEDI ) ( KUL BHARAT ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 16/ 02 /2016 2.., .../ T.C. NAIR, SR. PS !'#$%&' &$ / COPY OF THE ORDER FORWARDED TO : 1. '% / THE APPELLANT 2. &''% / THE RESPONDENT. 3. 345 6 / CONCERNED CIT 4. 6 ( ) / THE CIT(A)-II, AHMEDABAD 5. 7 8 &45 , 45. , 3 / DR, ITAT, AHMEDABAD 6. 8:; <* / GUARD FILE. ! / BY ORDER, '7 & //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 28.1.16 (DICTATION-PAD 11- P AGES ATTACHED AT THE END OF THIS FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 1.2.16 3. OTHER MEMBER 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.16.2.16 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 16.2.16 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER