Sri. Manzar Alikunju, Kollam V. The ACIT, Alappuzha

ITA 131/COCH/2016

• Counselvise Citation: [2019] 129 COUNSELVISE.COM (IT) 9888 (ITAT-COCHIN)
• Duration Of Justice: 2 year(s) 11 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-03-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 26-02-2019
• Assessment Year: 2008-2009
• Appeal Filed On: 24-03-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A S BINDHU
• Keywords: Unexplained cash credit; Audit objection; Question of law; TDS
• Section: 271(1)(c); 143(3); 40(a)(ia); 201; 148; 2

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFOR E S/ SHRI CHANDRA POOJARI , AM & GEORGE GEORGE K., J M I .T . A. NO S . 131&132/ CO CH/ 201 6 ASSESSMENT YEAR S : 2 0 09 - 09 & 2009 - 10 SHRI MANZAR ALIKUNJU, PANNAMPALLIL HOUSE, THODIYOOR NORTH P.O., KARUNAGAPALLY, KOLLAM. [[PAN:AHOPA 3182C] VS. THE ASSISTANT COMMISSIONER OF INCOME - TAX, CIRCLE - 1, ALAPPUZHA. (ASSESSEE - APPEL LANT) (REVENUE - RESPONDENT) A SSESSEE BY SHRI ARUN RAJ S, ADV. REVENUE BY SMT. A.S. BINDHU, SR. DR D ATE OF HEARING 26 / 0 2/ 201 9 DATE OF PRONOUNCEMENT 1 ST / 0 3 /201 9 O R D E R PER CHANDRA POOJARI, AM: TH ESE APPE AL S FILED BY THE ASSESSEE ARE DIRECTED AGAINST DIFFERENT ORDERS OF THE CIT (A), KOTTAYAM DATED 28/01/2016 AND PERTAIN TO THE A SSESSMENT YEAR S 2008 - 09 AND 2009 - 10. 2 . FIRST WE WILL TAKE UP THE APPE AL IN ITA NO.132/COCH/2016 FOR THE ASSESSMENT YEAR 2009 - 10 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS: 1. THE CIT (APPEALS) FAILED TO CONSIDER IN THE RIGHT PERSPECTIVE THE EXPLANATION OFFERED BY THE APPELLANT IN HIS WRITTEN REPLY DATED I.T.A. NO . 131 & 132 /COCH/ 201 6 2 18/06/2012 B EFORE THE OFFICER AND ALSO THE EXPLANATION OFFERED IN THE COURSE OF APPELLATE PROCEEDINGS. 2. THE LOWER AUTHORITIES ERRED IN IMPOSING A PENALTY OF RS.3,99,604/ - WITHOUT CONSIDERING IN THE RIGHT PERSPECTIVE THE EXPLANATION AND CIRCUMSTANCES UNDER WHICH C OMMISSION WAS MADE WHILE FILING THE RETURN. 3. THE CIT (APPEALS) OUGHT TO HAVE HELD THAT THE APPELLANT HAS NOT DELIBERATELY CONCEALED ANY PARTICULARS OF INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOME FOR THE AY 2009 - 10. 4. THE CIT(A) OUGHT TO HA VE NOTED THAT THE APPELLANT AGREED FOR THE ADDITION IN THE ASSESSMENT TO AVOID UNNECESSARY LITIGATION AND FOR PURCHASE OF PEACE IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 5. THE LOWER AUTHORITIES OUGHT TO HAVE NOTED THAT IN THE COURSE OF ASSESSMENT PROC EEDINGS INITIALLY, THE BANK A/C NUMBER INFORMED TO THE APPELLANT WAS DIFFERENT AND THEREFORE THE APPELLANT HAS STATED THAT THERE IS NO SUCH BANK ACCOUNT NUMBER IN HIS NAME. THE LOWER AUTHORITIES FAILED TO CONSIDER THE MATT ER IN THE RIGHT PERSPECTIVE. 6 . THE LOWER AUTHORITIES ERRED IN TAKING THE TOTAL CASH CREDIT OF RS.11,10,650/ - DEPOSITS ON VARIOUS DAYS THROUGHOUT THE YEAR, WITHOUT CONSIDERING THE WITHDRAWALS IN THE SAID BANK ACCOUNT, AS CONCEALED AMOUNT FOR IMPOSING PENALTY. 3. THE FACTS OF THE CA SE ARE THAT THE ASSESSEE IS A FRANCHISEE OF TATA TELESERVICES LTD. AND ALSO A DEALER IN AUTOMOBILE PARTS. THE ASSESSEE FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2009 - 10 RETURNING A TOTAL INCOME OF RS.6,78,150/ - . THE ASSESSMENT U/S. 143(3) OF THE ACT WAS COMPLETED ON 28/12/2011 DETERMINING A TOTAL INCOME OF RS.18,53,800/ - . IN PURSUANCE OF AN AIR INFORMATION RECEIVED, THE ASSESSING OFFICER COMPLETED THE ASSESSMENT BY ADDING BACK RS.11,10,650/ - U/S. 6 9 OF THE ACT. THOUGH THE ASSESSEE OBJECTED THE ADDITION INITIALLY, THE ASSESSEE AGREED WITH THE ADDITION MADE BY THE ASSESSING OFFICER. S UBSEQUENTLY, THE ASSESSING OFFICER ISSUED ORDER U/S. I.T.A. NO . 131 & 132 /COCH/ 201 6 3 271(1)(C) OF THE ACT, INITIATING PENALTY FOR CONCEALMENT OF INCOME AND FURNISHING INACCURATE PARTICULARS OF HIS INCOME IN THE RETURN FILED ON 02/12/2009. ACCORDINGLY, THE ASSESSING OFFICER LEVIED A MINIMUM PENALTY OF RS.3,99,604/ - U/S. 271(1)(C) OF THE ACT. 4. BEFORE THE CIT(A), THE ASSESSEE SUBMITTED THAT HIS BROTHER, AN NRI HAD OPERATED SAVINGS BANK ACCOUNT WITH SOUTH INDIAN BANK LTD., KARUNAGAPALLY IN ASSESSEES NAME FOR HIS FAMILY AND THIS ACCOUNT WAS NOT RELATED TO ANY OF THE ASSESSEES BUSINESS. IT WAS SUBMITTED THAT THE ACCOUNT WAS CLOSED EVEN BEFORE THE PENALTY ORDER AND THIS FACT CAME TO HIS KNOWLEDGE VERY LATE. SINCE THE ACCOUNT WAS OPENED AND OPERATED IN ASSESSEES NAME, IT WAS SUBMITTED THAT HE HAD AGREED TO ADD THE CASH CREDITS IN THE ACCOUNT OF THE ASSESSEES TOTAL INCOME TO AVOID LITIGATION AND FOR PURCHASE OF PEACE. THE ASSESSEE SUBMITTED THAT THE MUTUALLY ACCEPTED DEMAND WAS ALREADY PAID BY THE ASSESSEE. HENCE, IT WAS PRAYED THAT THE PENALTY IMPOSED U/S. 271(1)(C) OF THE ACT MAY BE DROPPED. 5. THE CIT(A) OBSERVED THAT THE ASSESSEE CONCEALED THE EXISTENCE OF THE BANK ACCOUNT FROM THE DEPART MENT. ACCORDING TO THE CIT(A), THE ASSESSEE HAD FURNISHED INACCURATE PARTICULARS OF HIS INCOME IN THE RETURN OF INCOME FILED. THE CIT(A) REJECTED THE EXPLANATION OFFERED BY THE ASSESSEE AND CONFIRMED THE LEVY OF PENALTY U/S. 271(1)(C) OF THE ACT. I.T.A. NO . 131 & 132 /COCH/ 201 6 4 6. AGAINST THIS, THE ASSESSEE IS IN APPEAL BEFORE US. 7. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. AS PER AIR INFORMATION, THE ASSESSEE HAD A SAVINGS BANK ACCOUNT WITH SOUTH INDIAN BANK LTD. AND DEPOSITED A SUM OF RS.11,10,650/ - . ON RECEIPT OF SHOW CAUSE NOTICE FROM THE ASSESSING OFFICER ON 15/11/2012, THE ASSESSEE REPLIED VIDE HIS LETTER DATED 23/11/2012 THAT HE HAD NO UNEXPLAINED CASH CREDIT OF RS.11,10,650/ - IN ANY OF HIS BANK ACCOUNTS OR BANK ACCOUNTS OF THE ASSOCIATED CONCER NS. LATER, IT WAS STATED THAT THE ASSESSEES BROTHER, AN NRI OPERATED THE BANK ACCOUNT AND IT WAS CLOSED BEFORE THE RECEIPT OF NOTICE OF LEVY OF PENALTY. HOWEVER, THE ASSESSEE CONCEALED THE FACT OF UNEXPLAINED AMOUNT DEPOSITED IN THE SOUTH INDIAN BANK LT D. AND IT WAS NOT DISCLOSED TO THE DEPARTMENT. IN OUR CONSIDERED OPINION, THIS IS A CLEAR CASE WHERE THE ASSESSEE INSPITE OF BEING OFFERED OPPORTUNITY TO EXPLAIN THE UNACCOUNTED BANK ACCOUNT, THE ASSESSEE CONCEALED THE DETAILS OF INCOME. IN OTHER WORDS, I T BECOMES A CASE OF CONCEALMENT OF TRUE AND CORRECT PARTICULARS OF INCOME CHARGEABLE TO TAX. THE CONCEALMENT OF INCOME MADE BY THE ASSESSEE WAS TO EVADE TAX. THE EXPLANATION OFFERED BY THE ASSESSEE IS FOUND TO BE FALSE, THEN IN THESE CIRCUMSTANCES, THE LE VY OF PENALTY U/S. 271(1)(C) IS JUSTIFIED. IT IS ALSO NOTICED THAT THE ASSESSEE NOT ONLY CONCEALED THE CORRECT INCOME, BUT ALSO ATTEMPTED TO GIVE FALSE EXPLANATION. IN VIEW OF THIS, WE ARE OF THE OPINION THAT THE LOWER AUTHORITIES WERE JUSTIFIED IN LEVY OF PENALTY I.T.A. NO . 131 & 132 /COCH/ 201 6 5 US. 271(1)(C) OF THE ACT. HENCE, THIS GROUND OF APPEAL OF THE ASSESSEE IS DISMISSED. THE APPEAL OF THE ASSESSEE IN ITA NO. 132/COCH/2016 IS DISMISSED. 8. IN THE APPEAL IN ITA NO. 131/COCH/2016 FOR THE ASSESSMENT YEAR 2008 - 09, T HE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS : 1. THE CIT (APPEALS) OUGHT TO HAVE CONSIDERED AND HELD THAT THE ISSUANCE OF NOTICE UNDER SECTION 148 OF THE ACT A N D REOPENING OF THE ASSESSMENT ON THE BASIS OF THE AUDIT OBJECTION FOR THE AY 2008 - 09 IS ILLEGAL AND ARBITRAR Y AND LIABLE TO BE CANCELLED. THE CIT (A) ERRED IN NOT CONSIDERING AND ACCEPTING THE ADDITIONAL GROUND IN THIS REGARD, WHICH IS A PURE QUESTION OF LAW, RAISED BY THE APPELLANT, WHICH FACT CAME TO THE KNOWLEDGE OF THE APPELLANT, IN THE COURSE OF APPELLAT E PROCEEDINGS. 2 . THE CIT (APPEALS) ERRED IN CONFIRMING THE ORDER OF THE ASSESSING OFFICER IN DISALLOWING SUM OF RS 46,05,833/ - UNDER SECTION 40 (A) (IA) OF THE INCOME TAX ACT FO R NON - DEDUCTION OF TAX U/S 194 H OF THE ACT AND THEREBY MAKING ADDITION TO THE RETURNED INCOME. 3 . THE CIT (APPEALS) FAILED TO NOTE/UNDERSTAND THAT THE APPELLANT IS A FRANCHISEE OF TATA TELE SERVICES LTD AND THE BUSINESS OF THE APPELLANT IS TO SELL RECHARGE CARDS/COUPONS TO THE CUSTOMERS AND IN THE SAID TRANSACTION THERE IS NO COMMISSION PAYMENT OR ANY KIND OF PAYMENT MADE TO THE CUSTOMERS BY THE APPELLANT . THE ASSESSING OFFICER ALSO FAILED TO LOOK INTO THE VERY NATURE OF TRANSACTION BETWEEN THE APPELLANT. 4 . THE CIT (APPEALS) AND THE ASSESSING OFFICER FAILED TO CONSIDER TH AT THERE IS NO PAYMENT MADE TO THE END CUSTOMER BY THE APPELLANT AND THEREFORE THE QUESTION OF TDS DOES NOT ARISE. THE AUTHORITIES BELOW FAILED TO CONSIDER/APPRECIATE THAT THE APPELLANT UPON SELLING THE RECHARGE COUPONS TO THE CUSTOMERS ONLY RECEIVES THE R ECHARGE AMOUNT FROM THE CUSTOMERS AND SOMETIMES RECEIVE THE PAYMENTS FROM THE CUSTOMERS AT THE DISCOUNTED RATES. THE ASSESSEE HAD SHOWN THE SAID DISCOUNT GIVEN TO THE CUSTOMERS (WHICH IS NOT COLLECTED FROM THE CUSTOMERS) AS COMMISSION BECAUSE M/S TATA TELE SERVICES LTD M/S. TATA TELE SERVICES LTD. DEDUCTED TAX AT SOURCE U/S. 194H AND GIVEN IT A NATURE OF COMMISSION WHILE MAKING THE SAID PAYMENT (WHICH IS GIVEN IN THE FORM OF RECHARGE COUPONS) TO APPELLANT ( VIZ AS REIMBURSEMENT). THE LOWER AUTHORITIES FAIL ED TO I.T.A. NO . 131 & 132 /COCH/ 201 6 6 APPRECIATE THE ABOVE ASPECTS IN THE RIGHT PERSPECTIVE AND ERRED IN HOLDING THAT THE AMOUNTS REPRESENTS COMMISSION PAYMENT TO THE CUSTOMERS. 5 . THE CIT (APPEALS) FAILED TO CONSIDER THE SPECIFIC CASE OF THE APPELLANT THAT THE DISCOUNTS /AMOUNT ADJUS TED TO THE INDIVIDUAL CUSTOMERS DOES NOT EXCEED RS 2500/ - AND THEREFORE, ASSUMING (WITHOUT ACCEPTING) THAT IF THE SAME IS CONSIDERED AS COMMISSION, THE PROVISIONS OF SECTION 194H OF DIE INCOME TAX ACT IS NOT ATTRACTED. THE CIT (APPEALS) FAILED TO CONSIDER IN THE RIGHT PERSPECTIVE THE LEDGER EXTRACTS/NOTE PRODUCED BY THE APPELLANT TO PROVE THAT THE DISCOUNTS (AMOUNTS NOT COLLECTED FROM THE CUSTOMERS WHICH IS MISTAKENLY SHOWN AS COMMISSION) GIVEN TO EACH INDIVIDUAL CUSTOMERS DO NOT EXCEED RS 2,500/ - , WHICH F ACT THE ASSESSING OFFICER HAS ALSO NOTICED IN THE ASSESSMENT PROCEEDINGS. 6 . THE CIT (APPEALS) FAILED TO CONSIDER THE CONTENTIONS/SUBMISSIONS OF THE APPELLANT IN THE RIGHT PERSPECTIVE AND DECIDED THE APPEAL ON A MISTAKEN UNDERSTANDING OF THE NATURE OF BUSINESS OF THE APPELLANT AND THE TRANSACTION INVOLVED. 9. THE FACTS OF THE CASE ARE THAT THE ASSESSING OFFICER NOTICED THAT IN THE PROFIT AND LOSS ACCOUNT ATTACHED WITH THE RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD DEBIT ED AN AMOUNT OF RS.46,05,833/ - ON ACCOUNT OF COMMISSION PAYMENTS, BUT HE HAD NOT DEDUCTED TAX U/S. 194H OF THE ACT AND HENCE, WAS DISALLOWABLE U/S. 40(A)(IA) OF THE ACT. THE ASSESSEE CONTENDED THAT COMMISSION PAYMENT OF RS.46,05,833/ - WAS MADE TO END CUST OMERS AND OUT OF THE SAID AMOUNT OF RS.34,36,733/ - REPRESENTED REIMBURSEMENT OF SPECIAL SCHEME PAYMENT BY THE TATA TELESERVICES LTD. FOR WHICH THEY HAD DEDUCTED TDS. ACCORDING TO THE ASSESSING OFFICER, AS PER THE PROVISIONS O F SECTION 194H OF THE ACT, TH E ASSESSEE SHOULD HAVE DEDUCTED TAX FROM PAYMENTS MADE BY HIM IRRESPECTIVE OF WHETHER TATA TELESERVICES LTD. HAD DEDUCTED OR REMITTED IT TO THE I.T.A. NO . 131 & 132 /COCH/ 201 6 7 GOVERNMENT ACCOUNT. IN VIEW OF THIS, THE ASSESSING OFFICER MADE AN ADDITION OF RS.46,05,833/ - U/S. 40(A)(IA) OF THE ACT. 10. BEFORE THE CIT(A), THE ASSESSEE HAD FILED AN ADDITIONAL GROUND THAT THE ASSESSING OFFICER IS NOT JUSTIFIED IN REOPENING THE ASSESSMENT ON THE BASIS OF AUDIT OBJECTION. BEFORE THE CIT(A), THE ASSESSEE FURTHER EXPLAINED THE GROUND AS FOLL OWS: (A) YOUR APPELLANT IS NOT PAYING COMMISSION TO THE END CUSTOMERS. THE AMOUNT CONSISTS OF DISCOUNTS GIVEN TO VARIOUS PARTIES REIMBURSED BY THE COMPANY. IT HAS BEEN ACCOUNTED AS COMMISSION IN BOOKS ONLY BECAUSE TATA TELE SERVICES LTD. DEDUCTED TAX U/S. 194H AND GIVEN IT A NATURE OF COMMISSION. (B) EVEN IF IT IS CONSIDERED AS COMMISSION, THE AMOUNTS ADJUSTED TO INDIVIDUAL PARTIES DO NOT EXCEED THE EXEMPTION LIMIT OF RS.2500/ - MENTIONED IN SECTION 194H TO ATTRACT DISALLOWANCE U/S. 40(A)(IA) OF THE ACT. THIS FACT WAS ALREADY EXPLAINED TO THE ASSESSING OFFICER AND WAS ALMOST CONVINCED. BIFURCATION OF TOTAL COMMISSION RECEIVED IN PROFIT AND LOSS ACCOUNT IS GIVEN BELOW: - LESS: AMOUNT REIMBURSED BY TATA TELE SERVICES LTD. RS.51,47,543/ - FOR GIVING DISCOUNT TO THE END CUSTOMERS RS.34 ,36,733/ - LESS: ADDITIONAL DISCOUNT GIVEN DURING THE YEAR FOR FIGHTING COMPETITION RS.11,69,101/ - TOTAL EXPENDITURE AS PER PROFIT AN D LOSS A/C RS.46,05,834/ - BALANCE BEING AMOUNT OF COMMISSION INCLUDED IN THE INCOME OF TRADING PROFITS RS. 5,41,709/ - TOTAL AMOUNT RECEIVED AS PER PROFIT AND LOSS ACCOU N T ACCOUNTED AS COMMISSION IS RS.51,47,543/ - . THIS AMOUNT INCLUDES RS.34,36,733/ - GIVEN AS RECHARGE DISCOUNT TO END CUSTOMERS REIMBURSED BY THE COMPANY. I.T.A. NO . 131 & 132 /COCH/ 201 6 8 THERE HAD BEEN NO GAIN FOR YOUR APPELLANT IN THIS ARRANGEMENT. TDS FOR THE SAID VALUE HAS A LREADY BEEN DEDUCTED AND UPLOADED IN YOUR APPELLANTS NAME BY THE COMPANY. YOUR APPELLANT IS MERELY ACTING AS AN INTERMEDIARY IN HANDING OVER THE BENEFIT OF THIS SCHEME TO THE CUSTOMERS. COPY OF INSTRUCTION LETTER FROM THE COMPANY FOR GIVING DISCOUNT TO THE CUSTOMERS FOR RS.34,36,733/ - IS ALSO ATTACHED HEREWITH. FURTHER YOUR APPELLANT HAS GIVEN ADDITIONAL DISCOUNT TO CUSTOMERS AMOUNTING TO RS.11,69,102/ - OUT OF DEALER COMMISSION RECEIVED FROM THE COMPANY TO BOOST SALE TO FIGHT COMPETITION. (THE ADDITIO NAL DISCOUNT GIVEN TO VARIOUS PARTIES HAS ALSO BEEN ACCOUNTED AS COMMISSION). IN THE CASE OF PAREEK ELECTRICALS VS. ASSISTANT COMMISSIONER OF INCOME - TAX CIRCLE - 2(1) CUTTACK, IT HAS BEEN HELD THAT TRADE DISCOUNT GIVEN TO SUB - FRANCHISEES AS A COMPENSATION F OREGOING PART OF COMMISSION ALREADY SUBJECTED TO TAX AT SOURCE BY THE COMPANY SHALL NOT AT TR ACT 194H AGAIN AND HENCE THE DISALLOWANCE WAS UNJUSTIFIED. THE COPY OF JUDGMENT IS ATTACHED HERE ALONG FOR YOUR KIND PERUSAL. ADDITIONAL GROUND AS PER THE ADDITI ONAL GROUNDS RAISED BY YOUR APPELLANT, THE ASSESSING OFFICER IS NOT JUSTIFIED IN REOPENING THE ASSESSMENT ON THE BASIS OF AUDIT OBJECTION. THE HONBLE HIGH COURT OF GUJARAT IN THE CASE OF SHREE RAM BUILDERS VS. ASSISTANT COMMISSIONER OF INCOME - TAX (2015) 121 DTR (GUJ) 101) HAS UPHELD THE SAME. THE COPY OF JUDGMENT IS ATTACHED HERE ALONG FOR YOUR KIND PERUSAL. 10.1 THE CIT(A) CONSIDERED THE ISSUE ON MERIT . THE CIT(A) REFERRED TO A LETTER PRODUCED BY THE ASSESSEE FROM TATA TELESERVICES LTD. DT. 0 7/12/2010 STATING THAT FOLLOWING AMOUNTS ARE REIMBURSED TO M/S. MS COMMUNICATION. CRICKET HUN G AMA RS.31,16,766/ - MIRACLE RECHARGE COUPON RS. 2,77,521/ - BAKRID X MAS SPECIAL SCHEMES RS. 42,446/ - RS.34,36,733/ - FROM THE ABOVE, THE CIT(A) OBSERVED THAT IT IS NOT CLEAR HOW CRICKET HANGAMA IS A SCHEME REIMBURSED BY THE TELEPHONE COMPANY. ACCORDING TO THE CIT(A) REIMBURSE MENT MEANS MONIES ACTUALLY HAD BEEN PAID TO THE ASSESSEE. THE I.T.A. NO . 131 & 132 /COCH/ 201 6 9 CIT(A) OBSERVED THAT IF THE ASSESSEE IS CLAIMING THAT IT WAS A DISCOUNT TO THE CUSTOMER, THEN THE ASSESSEE SHOULD ALSO RECEIVE A DISCOUNT, INSTEAD OF THAT, HE ASSESSEE HAD RECEIVED COMMISSION . HENCE THE CIT(A) REJECTED THE ARGUMENT OF THE ASSESSEE AND IT WAS TREATED AS INCOME OF THE ASSESSEE. FURTHER, ON VERIFICATION OF THE NOTE BOOK IN WHICH DETAILS OF PERSONS TO WHOM THE COMMISSION WAS PAID, THE CIT(A) FOUND THAT IT WAS A HANDWRITTEN KATC HA NOTE BOOK IN WHICH NAME AND VILLAGE OF PERSONS WERE WRITTEN BUT NO PROPER ADDRESS WAS AVAILABLE AND THE ASSESSEE WAS NOT ABLE TO PRODUCE ANY CONFIRMATION IN THIS REGARD. THE CIT(A) OBSERVED THAT THE CASE LAWS RELIED UPON BY THE ASSESSEE WERE AGAINST T HE FACTS OF THE ASSESSEES CASE. THE ASSESSEE WAS NOT ABLE TO PROVE THE GENUINENESS OF THE DISCOUNT GIVEN BY HIM. HENCE, THE CIT(A) JUSTIFIED THE ACTION OF THE ASSESSING OFFICER AND CONFIRMED THE ADDITION. 11. AGAINST THIS, THE ASSESSEE IS IN AP PEAL BEFORE US. 12. THE LD. DR RELIED ON THE ORDER OF THE LOWER AUTHORITIES. 13. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RECORD. WE FIND THAT THE CIT(A) HAS NOT AT ALL ADJUDICATED THE ADDITIONAL GROUND RAISED BY THE ASSESSEE. IN VIE W OF THIS, WE VACATE THE FINDINGS OF THE CIT(A) WHICH WAS DECIDED BY HIM ON MERIT AND RE MIT T HE ENTIRE ISSUE TO THE FILE OF THE CIT(A) WITH A DIRECTION TO ADJUDICATE THE ADDITIONAL GROUND FIRST AND THEN, IF HE REQUIRES, HE I.T.A. NO . 131 & 132 /COCH/ 201 6 10 HAS TO DECIDE THE OTHER GROUNDS A FRESH. ACCORDINGLY, THE A PPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. 14 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IN ITA NO. 132 / COCH/2016 IS DISMISSED AND THE APPEAL OF THE ASSESSEE IN ITA NO.131/COCH/2016 IS ALLOWED FOR STATISTI CAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 01 ST MARCH, 2019 SD/ - SD/ - (GEORGE GEORGE K.) (CHANDRA P OOJARI) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE: KOCHI DATED: 01 ST MARCH , 2019 GJ COPY TO: 1 . SHRI MANZAR ALIKUNJU, PANNAMPALLIL HOUSE, THODIYOOR NORTH P.O., KARUNAGAPALLY, KOLLAM. 2. THE ASSISTANT COMMISSIONER OF INCOME - TAX, CIRCLE - 1, ALAPPUZHA. 3 . THE COMMISSIONER OF INCOME - TAX(APPEALS), KOTTAYAM. 4. THE PR. COMMISSIONER OF INCOME - TAX, KOTTAYAM 5. D. R., I.T.A.T., COCHIN BENCH, COCHIN. 6 . GUARD FILE. BY ORDER (ASSISTANT REGISTRAR) I.T.A.T., COCHIN I.T.A. NO . 131 & 132 /COCH/ 201 6 11