Gour Nitye Tea & Industries Ltd, Jalpaiguri V. ACIT, Circle-1, Jalpaiguri, Jalpaiguri

ITA 1220/KOL/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 99875 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 1 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-10-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 27-08-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 21-08-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NILOY BASAN SOM JCITSRDR
• Keywords: Principle of natural justice
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH B KOLKATA BEFORE SHRI N.V. VASUDEVAN, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ITA NO. 1220 / KOL / 2012 ASSESSMENT YEAR :2008-09 GOUR NITYE TEA & INDUSTRIES LTD., RAIKAT PARA, P.O. & DISTRICT JALPAIGURI [ PAN NO. AABCG 1513 E ] V/S . ASSTT. COMMISSIONER OF INCOME TAX, CIRCLE- 1 JALPAIGURI /APPELLANT .. / RESPONDENT /BY ASSESSEE SHRI SUBASH AGARWAL, ADVOCATE /BY RESPONDENT SHRI NILOY BASAN SOM, JCIT, SR-DR /DATE OF HEARING 08-09-2015 /DATE OF PRONOUNCEMENT 07-10-2015 / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER:- THIS APPEAL BY ASSESSEE IS ARISING OUT OF ORDER OF COMMISSIONER OF INCOME-TAX (APPEALS), JALPAIGURI IN APPEAL NO.26/JA L/CIT(A)/JAL/10-11 DATED 25.01.2011. ASSESSMENT WAS FRAMED BY ACIT, CI RCLE-1, JALPAIGURI U/S 143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REF ERRED TO AS THE ACT) VIDE HIS ORDER DATED 30.12.2010 FOR ASSESSMENT YEAR 2008 -09. ITA NO.1220/KOL/2012 A.Y.2008-09 GOUR NITYE TEA & INDS. LTD. V. ACIT CIR-1, JAL PAGE 2 2. THE ISSUE RAISED BY ASSESSEE IN THIS APPEAL IS T HAT LD. CIT(A) HAS ERRED IN CONFIRMING THE ORDER OF ASSESSING OFFICER BY DIS ALLOWING CERTAIN EXPENSES AS DETAILED BELOW:- PACKING MATERIALS EXPENSES OF RS.12,89,597/- TEA SELLING EXPENSES OF RS.38,17,760/- REPAIRS & MAINTENANCE CHARGES OF RS.11,09,226/- 3. BRIEFLY STATED FACTS ARE THAT ASSESSEE IS A PUBL IC LIMITED COMPANY AND IS INTO THE BUSINESS OF TEA PLANTATION AND MANUFACTURI NG OF TEA. DURING THE RELEVANT YEAR ASSESSING OFFICER HAS DISALLOWED THE EXPENSES ON AD HOC BASIS AS STATED ABOVE ON THE GROUND OF NON-PRODUCTION OF SUPPORTING DOCUMENTS AND SELF-HAND MADE DEBIT VOUCHERS. AGGRIEVED BY THI S ORDER ASSESSEE PREFERRED APPEAL BEFORE LD. CIT(A) WHO HAS UPHELD T HE ORDER OF AO BY RESTRICTING THE DISALLOWANCE TO THE TUNE OF 5% OF T HE TOTAL EXPENSES INCURRED BY ASSESSEE. AGGRIEVED BY THIS ORDER ASSESSEE PREFERRE D APPEAL BEFORE THE TRIBUNAL AND RAISED FOLLOWING GROUNDS OF APPEAL:- 1) THAT THE CONFIRMATION OF THE LD. ASSESSING OFFI CERS (BRIEFLY THE A.OS) ORDER DATED 25/06/2012 BY THE LD. COMMISSION ER OF INCOME TAX (APPEALS) IS ARBITRARY, BAD IN LAW AND IS NOT PROPE R AND ALSO DENIAL OF NATURAL JUSTICE. 2) THAT YOUR APPELLANT PETITIONER HAS BEEN CARRYING ON BUSINESS IN GROWING, MANUFACTURING AND SELLING OF TEA. THE APPE LLANT COMPANY E- FILED ITS RELEVANT RETURN ON 27/09/2008 FOR THE ASS ESSMENT YEAR 2008-09 SHOWING INCOME AS NIL AND LOSS FOR THE YEAR TO BE C ARRIED FORWARD RS.41,37,412/-. THE LD. ASSESSING OFFICER (BRIEFLY THE A.O) COMPLETED THE ASSESSMENT ON 30/12/2010 DETERMINING THE LOSS T O BE CARRIED FORWARD OF RS.38,88,749/-. IN DOING SO THE LD. AO D ISALLOWING THE BONA FIDE EXPENSES AND MADE ADDITIONS TOO ARBITRARILY AND ILLEGALLY. THAT THE LD. APPELLANT AUTHORITY SHARING THE VIEWS OF LD. AO AND CONFIRMING THE DETERMINATION OF POSSIBILITY OF INFL ATING THE EXPENSES THROUGH SELF MADE VOUCHERS IN SUSPICIOUS & HYPOTHET ICAL MANNER WITHOUT CONSIDERING THE AUTHENTICATED PROFIT & LOSS ACCOUNT & BALANCE SHEET DULY AUDITED BY A QUALIFIED CHARTERED ACCOUNT ANT AS WELL AS INSPITE OF SUBMISSION OF ORIGINAL BILLS OF PACKING MATERIALS EXPENSES AND BILLS OF BROKERS AND CONSIGNEE COMPANIES AND BILLS & VOUCHERS OF REPAIR ITA NO.1220/KOL/2012 A.Y.2008-09 GOUR NITYE TEA & INDS. LTD. V. ACIT CIR-1, JAL PAGE 3 & MAINTENANCE EXPENSES BY 5% OF EXPENSES IN LIEU OF 10% AS DETERMINED BY THE ASSESSING OFFICER ORIGINALLY I A ROUTINE MANNER WITHOUT BRINGING INTO THE RECORDS OF ANY MATERIALS IN SUPPO RT THEREOF. THE SUSPICIOUS HOWEVER HIGH CANNOT TAKE PLACE OF EVIDEN CE. THE LD. AO HAD DISALLOWED THE SAID EXPENSES IN MOST CASUAL AND ROUTINE MANNER WITHOUT CONSIDERING THE NATURE OF EXPENSES. 4. THE LD AR SUBMITTED A PAPER BOOKS CONTAINING PAG ES FROM 1 TO 51. AT THE TIME OF HEARING LD. COUNSEL APPEARING ON BEHALF OF ASSESSEE HAS DRAWN OUR ATTENTION BY REFERRING TO PAGE NO. 40-42 OF ASS ESSEES PAPER BOOK, WHEREIN THE COMPARATIVE STATEMENT OF EXPENDITURE AN D PERCENTAGE OF COST FOR PREVIOUS YEAR 2005-06, 2006-07 AND 2008-09 HAVE BEE N GIVEN AND BASED ON THE SAME LD. COUNSEL FOR THE ASSESSEE CONTENDED THA T PERCENTAGE OF EXPENDITURE INVOLVED DURING THE IMPUGNED ASSESSMENT YEAR IS LESS THAN PREVIOUS YEAR AND HE REQUESTED TO DELETE THE ADDITI ON WHICH WERE MADE BY AO BASED ON SUSPICION AND SURMISES. ON THE OTHER HA ND, LD. DR APPEARING ON BEHALF OF REVENUE RELIED ON THE ORDERS OF AUTHOR ITIES BELOW. 5. AFTER HEARING THE RIVAL SUBMISSIONS AND ON CAREF UL PERUSAL OF THE MATERIALS AVAILABLE ON RECORD, KEEPING IN VIEW OF T HE FACT THAT LD. COUNSEL FOR ASSESSEE HAS FILED A COMPARATIVE STATEMENT OF EXPEN DITURE AND UNIT COST PER KG FOR THE LAST PREVIOUS YEAR 2005-06, 2006-07 AND 2007-08 WHEREIN THE ABOVE LISTED EXPENSES ARE LESS THAN THE PREVIOUS YE AR UNDER CONSIDERATION. THE ASSESSEE HAS ALSO SUBMITTED A CASE LAW IN SUPPO RT OF ITS OWN CASE, WHERE THE TRIBUNAL HAS GIVEN THE RELIEF TO THE ASSESSEE, IN ITA NO. 507/KOL/ 2011 FOR AY 2005-06 DATED 16.03.2012 IN PARA-6, WHICH REPRO DUCED AS UNDER:- 6. AFTER HEARING THE RIVAL SUBMISSIONS AND ON CARE FUL PERUSAL OF MATERIALS AVAILABLE ON RECORD, KEEPING IN VIEW OF T HE FACT THAT THE LD. COUNSEL FOR ASSESSEE HAS FILED A COMPARATIVE STATEM ENT OF THE EXPENDITURE AND PERCENTAGE OF COST FOR AYRS 2002-03 TO 200506 WHICH ARE PLACED AT PAGE NOS 5 AND 6 OF THE PAPER B OOK IT IS OBSERVED THAT THE EXPENDITURE INVOLVED IN THE ASSESSMENT YEA R UNDER CONSIDERATION I.E. 2005-06 IS MUCH LESS THAN THE PR EVIOUS YEAR. THEREFORE WE SET ASIDE THE ORDERS OF THE REVENUE AU THORITIES AND ALLOW THE APPEAL OF THE ASSESSEE. ITA NO.1220/KOL/2012 A.Y.2008-09 GOUR NITYE TEA & INDS. LTD. V. ACIT CIR-1, JAL PAGE 4 IT IS OBSERVED THAT THE EXPENDITURE INVOLVED IN THE ASSESSMENT YEAR ARE LESS THAN THE YEAR PREVIOUS YEAR, THEREFORE WE SET ASIDE THE ORDERS OF AUTHORITIES BELOW AND ALLOW ASSESSEES GROUND. 6. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT 07 /10/2015 SD/- SD/- (N.V.VASUDEVAN) (WASEEM AHMED) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) KOLKATA, *DKP !- 07 /10/2015 / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT GOUR NITYE TEA & INDUSTRIES LTD., RA IKAT PARA, P.O. & DIST. JALPAI GURI - 735101 2. / RESPONDENT- ACIT, CIRCLE-1, JALPAIGURI -735101 3. * +, - - . / CONCERNED CIT KOLKATA 4. - - .- / CIT (A) KOLKATA 5. 012 33+,, - +, , / DR, ITAT, KOLKATA 6. 267 89 / GUARD FILE. BY ORDER/ - , /TRUE COPY/ / - +, ,