Plasticon Technologies Pvt. Ltd., Hyderabad V. Income Tax Officer, Hyderabad

ITA 1280/HYD/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 74461 (ITAT-HYDERABAD)
• Duration Of Justice: 3 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 20-09-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: P BALAKRISHNA
• Keywords: Revision of order
• Section: 143(3); 263; 63; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER ITA NO. 1280/HYD/2013 ASSESSMENT YEAR: 2006-07 PLASTICON TECHNOLOGIES PVT. LTD., HYDERABAD. PAN AADCP0670M VS. INCOME TAX OFFICER, WARD 16 (2), HYDERABAD. APPELLANT RESPONDENT ASSESSEE BY: SRI P. BALAKRISHNA REVENUE BY: SRI JEEVAN LAL LAVIDIYA DATE OF HEARING: 08/01/2014 DATE OF PRONOUNCEMENT: 08/01/2014 O R D E R PER CHANDRA POOJARI, AM: THIS APPEAL PREFERRED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDERS OF THE CIT(A), HYDERABAD DATED 03/06/2013 FO R THE ASSESSMENT YEAR 2006-07 WHEREIN THE ASSESSEE HAS RA ISED THE FOLLOWING GROUNDS OF APPEAL: 1. BOTH ASSESSING OFFICER AND CIT(A) HAVE ERRED IN LAW AND FACTS OF THE CASE. 2. THE REJECTION TO VERIFY THE INFORMATION SUBMITTE D BY THE APPELLANT, BY BOTH ASSESSING OFFICER AND CIT(A) IS ARBITRARY AND THEREFORE THE DISMISSAL OF THE APPEAL IS NOT JU STIFIED. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSES SEE COMPANY FILED ITS RETURN OF INCOME FOR THE AY 2006-07 ON 18 -11-2006 ADMITTING INCOME OF RS. 2,32,067/-. THE ASSESSMENT WAS COMPLETED U/S 143(3) DATED 30/12/2008 ASSESSING THE INCOME AT RS. 6,41,511/- AFTER SET OFF OF CARRY FORWARD LOSSES OF RS. 7,20,9 14/-. THE CIT-IV, HYDERABAD VIDE ORDER U/S 263 DATED 25/03/2011 HAD D IRECTED THE I.T.A. NO. 1280/HYD/2013 PLASTICON TECHNOLOGIES PVT. LTD. 2 ASSESSING OFFICER TO REDO THE ASSESSMENT BY MAKING THE FOLLOWING ADDITIONS: I) INFLATION IN PURCHASE DEBITED TO THE P&L A/C OF RS. 18,23,885/- II) ADDITION OF TRANSPORT CHARGES OF RS. 12,22,779/ - III) DISALLOWANCE OF RS. 2,89,069/- ON ACCOUNT CENV AT CREDIT. IV) DISALLOANCE OF RS. 1,85,706/- ON ACCOUNT OF VAT INPUT TAX. 2.1 ACCORDINGLY, THE ASSESSING OFFICER FOLLOWING TH E DIRECTIONS OF THE CIT VIDE HIS ORDER DATED 28/10/2011 PASSED ORDE R U/S 144 R.W.S. 263 OF THE IT ACT, ADDED THE ABOVE TOTAL AMOUNT OF RS. 35,21,439/- TO THE INCOME DETERMINED AS PER ORDER U/S 143(3) DA TED 30/12/2008. 3. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN AP PEAL BEFORE THE CIT(A). 4. BEFORE THE CIT(A), THE ASSESSEE SUBMITTED A PAPE R BOOK ON 29/11/2011, WHICH WAS SENT TO THE ASSESSING OFFICER TO VERIFY THE CLAIMS AND FOR A REMAND REPORT. THE ASSESSING OFFIC ER VIDE HIS LETTER DATED 13/12/2012 STATED THAT HE FOLLOWED THE DIRECTIONS OF THE CIT ISSUED VIDE ORDER U/S 263 DATED 25/03/2011 AND PASSED ASSESSMENT ORDER U/S 144 RWS 263, AND UNDER THESE C IRCUMSTANCES, VERIFICATION OF THE DATA SUBMITTED BY THE ASSESSEE WOULD BE AGAINST THE DIRECTIONS OF THE CIT-IV, HYDERABAD. 5. WITH REGARD TO ALLOWANCE OF CARRY FORWARD LOSS O F RS. 7,20,914/-, WHICH WAS ALLOWED IN THE ORIGINAL ASSES SMENT, THE CIT(A) OBSERVED THAT IN ORIGINAL ORDER PASSED U/S 1 43(3) OF THE IT ACT, DATED 30/12/2008, THE ASSESSING OFFICER COMPUT ED THE TOTAL INCOME AT RS. 13,62,425/- BY MAKING DISALLOWANCE U/ S 40A(IA) OF RS. 3,78,241/-, DISALLOWANCE OF PROVISION FOR ELECT RICITY CHARGES OF RS. 6,71,617/- AND DISALLOWANCE OF CAPITAL EXPENDIT URE OF RS. 80,500/- AND ADDED THE SAME TO THE RETURNED INCOME OF RS. 2,32,067/-. HE NOTED THAT THE ASSESSING OFFICER ALL OWED CARRY I.T.A. NO. 1280/HYD/2013 PLASTICON TECHNOLOGIES PVT. LTD. 3 FORWARD LOSS OF RS. 7,20,914/- RESULTING IN NET TAX ABLE INCOME OF RS. 6,41,511/-. 5.1 THE CIT(A) NOTED THAT THE ASSESSING OFFICER FOL LOWING THE ORDER U/S 263, PASSED ORDER U/S 144 RWS 263 OF THE IT ACT, HAD MISTAKENLY TAKEN THE TOTAL INCOME COMPUTED AS PER O RIGINAL ASSESSMENT ORDER DATED 30/12/2008 AT RS. 13,62,425/ - INSTEAD AT RS. 6,41,511/- AFTER ALLOWING CARRYING FORWARD LOSS OF RS. 7,20,914/- . 5.2 THE CIT(A) HELD THAT AS IT IS A MISTAKE APPAREN T FROM RECORD, THE ASSESSING OFFICER IS DIRECTED TO ADOPT THE TOTA L INCOME ARRIVED AS PER THE ORIGINAL ASSESSMENT ORDER DATED 30/12/20 08 AT RS. 6,41,511/- AND THEN RE-COMPUTE THE TOTAL INCOME AFT ER GIVING EFFECT TO THE DIRECTIONS OF THE CIT. 5.3 AS REGARDS THE CONTENTION OF THE ASSESSEE THAT NO PROPER OPPORTUNITY WAS GIVEN TO THE ASSESSEE WHILE COMPLET ING THE ASSESSMENT, THE CIT(A) HELD THAT THERE IS NO TRUTH IN THE CONTENTION OF THE ASSESSEE AND REJECTED THE CONTENTION OF THE ASSESSEE. 5.4 THE CIT(A) NOTED THAT THE ASSESSEE FILED AN APP EAL BEFORE THE CIT(A) AGAINST THE ORDER OF THE CIT PASSED U/S 263 OF THE ACT DATED 25/03/2011 AND THE ITAT VIDE ITS ORDER DATED 31/08/ 2012 IN ITA NO. 751/HYD/2011 HAD DISMISSED THE APPEAL OF THE ASSESS EE. THE RELEVANT FINDINGS OF THE ITAT WERE EXTRACTED BY THE CIT(A) IN HIS ORDER AT PAGES 6 TO 8 OF THE ORDER. 5.5 THE CIT(A) FOLLOWING THE ORDER OF THE ITAT (SUP RA) CONFIRMED THE ADDITIONS IN RESPECT OF RS. 18,23,885/- REPRESE NTING THE INFLATION IN PURCHASE DEBITED TO THE P&L ACCOUNT AND II) RS. 12,22,779/- IN RESPECT OF TRANSPORT CHARGES CLAIMED TWICE. REGARDI NG DIFFERENCE IN CENVAT CREDIT AVAILED BY THE ASSESSEE AT RS. 2,89,0 69/- AND I.T.A. NO. 1280/HYD/2013 PLASTICON TECHNOLOGIES PVT. LTD. 4 DIFFERENCE IN VAT INPUT TAX AT RS. 1,85,706/-, THE CIT(A) CONFIRMED SAID ADDITIONS. 6. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US. 7. WE HAVE HEARD THE ARGUMENTS OF BOTH THE PARTIES, PERUSED THE RECORD AND HAVE GONE THROUGH THE ORDERS OF THE REVENUE AUTHORITIES. WE HAVE ALSO CAREFULLY GONE THROUGH TH E ORDER OF THE CIT PASSED U/S 263 DATED 25/03/2011. AGAINST THIS O RDER, THE ASSESSEE CAME IN APPEAL BEFORE THE TRIBUNAL, AND TH E TRIBUNAL DISMISSED THE APPEAL OF THE ASSESSEE BY HOLDING AS UNDER: 19...................WE ARE OF THE OPINION THAT THE CIT WAS RIGHT IN DIRECTING THE ASSESSING OFFICER TO REDO THE ASSESSM ENT AS THE ASSESSING OFFICER IN THE ORIGINAL ASSESSMENT HAD NO T MADE ANY ENQUIRIES AS TO THE GENUINENESS OF PURCHASE FIG URE OR AS TO THE VALIDITY OF THE ASSESSEES SEPARATE DEBIT OF TRANSPORT EXPENDITURE UNDER THE HEAD OF DIRECT EXPENSES I.E. SCHEDULE 11 TO THE P&L ACCOUNT. FURTHER, THE ASSESSING OFF ICER HAS NOT APPLIED HIS MIND BY VERIFYING FROM THE SALES TA X AUTHORITIES AND FAILED TO ASCERTAIN THE CORRECT FIG URES. THE ORDER OF THE ASSESSMENT PASSED BY THE ASSESSING OFF ICER WITHOUT MAKING NECESSARY ENQUIRIES ON CERTAIN IMPOR TANT POINTS CONNECTED WITH THE ASSESSMENT WOULD BE ERRON EOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE. 7.1 THE ASSESSEE RAISED AN ADDITIONAL GROUND BEFORE THE CIT(A) THAT THE ASSESSING OFFICER ERRED GROSSLY IN ADOPTIN G THE TOTAL INCOME DETERMINED AT RS. 13,62,425/- U/S 143(3) DAT ED 31/03/2008, WHICH WAS NOT EXISTING AT A TIME OF THE COMPLETING THE ASSESSMENT U/S 144 RWS 263 OF THE ACT BY VIRTUE OF ORDER U/S 2 63 OF THE CIT, HENCE, THE ORDER U/S 144 LIABLE TO BE QUASHED. THE CIT(A) QUASHED THIS GROUND BY OBSERVING THAT THERE IS NO TRUTH IN THE CONTENTION OF THE ASSESSEE. MOREOVER, WHEN THE ASSESSEE FILED AN APPEAL AGAINST THE ORDER PASSED U/S 263, HE COULD NOT SUCCEED. THE REFORE, THERE IS NO MERIT IN THE CONTENTIONS OF THE ASSESSEE. 7.2 BEFORE US, THE ASSESSEE RAISED A GROUND AND TH E SAME IS THAT THE REJECTION TO VERIFY THE INFORMATION SUBMIT TED BY THE I.T.A. NO. 1280/HYD/2013 PLASTICON TECHNOLOGIES PVT. LTD. 5 ASSESSEE BY BOTH THE ASSESSING OFFICER AND CIT(A) I S ARBITRARY AND THEREFORE THE DISMISSAL OF THE APPEAL IS NOT JUSTIF IED. BEFORE THE CIT(A), THE ASSESSEE SUBMITTED A PAPER BOOK WHICH W AS SENT TO THE ASSESSING OFFICER TO VERIFY THE CLAIMS AND FOR A RE MAND REPORT. THE ASSESSING OFFICER VIDE HIS LETTER DATED 13/12/2012 STATED THAT HE FOLLOWED THE DIRECTIONS OF THE CIT ISSUED VIDE ORDE R U/S 263 DATED 25/03/2011 AND PASSED ASSESSMENT ORDER U/S 144 RWS 263, AND UNDER THESE CIRCUMSTANCES, VERIFICATION OF THE DATA SUBMITTED BY THE ASSESSEE WOULD BE AGAINST THE DIRECTIONS OF THE CIT -IV, HYDERABAD. THEREFORE, THE GROUND RAISED BY THE ASSESSEE HAS NO MERIT AND THE SAME IS HEREBY DISMISSED. 7.3 IN VIEW OF THE ABOVE DISCUSSION, WE UPHOLD THE FINDINGS OF THE CIT(A) AND THE ORDER OF THE CIT(A) IS HEREBY CONFIR MED DISMISSING THE GROUNDS RAISED BY THE ASSESSEE. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISS ED. PRONOUNCED IN THE OPEN COURT ON 08/01/2014. SD/- (ASHA VIJAYARAGHAVAN) JUDICIAL MEMBER SD/- (CHANDRA POOJARI) ACCOUNTANT MEMBER HYDERABAD, DATED 08/01/2014. KV COPY FORWARDED TO: 1. PLASTICON TECHNOLOGIES PVT. LTD., C/O V. MADHUSU DHAN PHANI,COMPANIES ACT, 1956 (1 OF 1956), H.NO. 10-3-3 35, NEW VIJAYNAGAR COLONY, HYDERABAD 500 057. 2. ITO, WARD 16 (2), HYDERABAD 3. CIT(A)-V, HYDERABAD 4. CIT-IV, HYDERABAD. 5. THE DR, ITAT, HYDERABAD