R N D Wafer Machines Private Limited, Hyderabad V. Asst. Commissioner of Income Tax(OSD), Ward-3(2), Hyderabad

ITA 1342/Hyd/2019

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 3631 (ITAT-HYDERABAD)
• Duration Of Justice: 2 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-11-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-B
• Assessment Year: 2011-2012
• Appeal Filed On: 27-08-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES SMC, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER I.T.A. NO. 1342/HYD/2019 ASSESSMENT YEAR: 2011-12 RND WAFER MACHINES PRIVATE LIMITED, HYDERABAD [PAN: AACCR9653H] VS ASST. COMMISSIONER OF INCOME TAX (OSD), WARD-3(2), HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI MOHD.AFZAL, AR FOR REVENUE : SMT. MATTA PADMA, DR DATE OF HEARING : 04-11-2019 DATE OF PRONOUNCEMENT : 11-11-2019 O R D E R THIS APPEAL FILED BY THE ASSESSEE FOR THE AY.2011-12 IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCO ME TAX (APPEALS)3, HYDERABAD, DATED 08-07-2019. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSING OFFIC ER (AO) RECEIVED AN INFORMATION THAT THE ASSESSEE, DURING THE F INANCIAL YEAR RELEVANT TO THE AY.2011-12, HAS ACQUIRED AN ASSET FOR RS.20,12,035/-. HE OBSERVED THAT THE ASSESSEE HAS NOT FILED ANY RETURN OF INCOME FOR THE AY.2011-12. SINCE HE WA S OF THE OPINION THAT THE INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT, A NOTICE U/S.148 OF THE INCOME TAX ACT [AC T] WAS ISSUED TO THE ASSESSEE ON 31-03-2018. ITA NO. 1342/HYD/2019 :- 2 -: 3. DURING THE RE-ASSESSMENT PROCEEDINGS, HOWEVER, NON E APPEARED FOR THE ASSESSEE AND THE AO COMPLETED THE PROCEEDINGS U/S.144 OF THE ACT BY BRINGING TO TAX THE SU M OF RS.20,12,035/- AS UN-EXPLAINED INVESTMENT U/S.69A O F THE ACT. 3.1. AGGRIEVED, THE ASSESSEE PREFERRED AN APPEAL BEF ORE THE CIT(A), WHO CONFIRMED THE ORDER OF AO EX-PARTE THE ASSESSEE BY OBSERVING THAT THE ASSESSEE HAS NOT FILED ANY RETURN OF INCOME AND ASSESSEE IS NOT EXEMPT FROM OPERATION OF PROVISION S OF SECTION 249(4)(B) OF THE ACT. 3.2. AGGRIEVED, THE ASSESSEE IS IN SECOND APPEAL BEF ORE THE TRIBUNAL, BY RAISING THE FOLLOWING GROUNDS: 1. THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IS AGAINST THE LAW, WEIGHT OF EVIDENCE AND PROBABILITI ES OF CASE. 2. THE LEARNED COMMISSIONER OUGHT TO HAVE APPRECIAT ED THAT THERE ARE NO TRANSACTIONS FOR THE SUBJECT ASSESSMENT YEAR , THEREFORE, NO RETURN OF INCOME WAS FILED BY THE ASSESSEE. 3. THE LEARNED COMMISSIONER ERRED IN DISMISSING THE APPEAL ASSUMING THAT THE CONDITIONS LAID DOWN U/S.249(4) A RE VIOLATED, WHEREAS, NO INCOME WAS ACCRUED TO THE ASSESSEE AS T HERE WERE NO TRANSACTIONS IN THE SUBJECT ASSESSMENT YEAR AND NO TAX IS PAYABLE. 4. THE LEARNED COMMISSIONER OUGHT TO HAVE APPRECIAT ED THAT THE PURCHASE OF CAR FOR RS.20,12,035/- WAS MADE BY THE PARTNERSHIP FIRM NAMELY, R AND D ENGINEERS (PAN AACFR2450D) AND THE SAME IS REFLECTED IN THE HANDS OF R AND D ENGINEERS, THEREF ORE, ERRED IN CONFIRMING THE ADDITIONS. 5. THE LEARNED COMMISSIONER OUGHT TO HAVE PROVIDED ONE MORE OPPORTUNITY TO THE ASSESSEE FOR CLARIFICATION OF TR ANSACTION WHICH RESULTED IN ADDITION OF RS.20,12,035/- AND ALSO IN RESPECT OF APPLICABILITY OF SECTION 249(4). ITA NO. 1342/HYD/2019 :- 3 -: 6. THE APPELLANT CRAVES LEAVE TO ADD TO, AMEND OR M ODIFY THE ABOVE GROUNDS OF APPEAL EITHER BEFORE OR AT THE TIME OF H EARING OF THE APPEAL, IF IT IS CONSIDERED NECESSARY. 4. THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE IS A COMPANY, WHEREAS THERE IS ANOTHER PAR TNERSHIP FIRM BY NAME M/S.R AND D ENGINEERS, WHOSE PAN WAS AACFR2450D . HE SUBMITTED THAT THE AO HAD ERRED IN MAKING THE SAID ADDITION OF RS.20,12,035/- U/S.69A OF THE AC T IN THE HANDS OF THE ASSESSEE-COMPANY INSTEAD OF EXAMINING I T IN THE HANDS OF THE FIRM WITH SIMILAR NAME. LD.COUNSEL ALSO SUBMITTED THAT THE AO AS WELL AS THE CIT(A) HAVE HELD TH AT THE ASSET HAS BEEN PURCHASED BY THE ASSESSEE HEREIN. TO C OUNTER THE SAME, HE HAS FILED A COPY OF THE TAX INVOICE IN SU PPORT OF HIS CONTENTIONS THAT THE PROPERTY HAS BEEN PURCHASED BY THE FIRM AND ALSO THAT THE ASSET HAS BEEN SHOWN IN THE BOOK S OF THE SAID FIRM AND THE DEPRECIATION HAS ALSO BEEN CLAIM ED THEREIN. FINALLY, LD.COUNSEL PRAYED FOR REMANDING THE ISSUE BACK TO THE FILE OF AO FOR RE-VERIFICATION OF THESE DETA ILS. 5. LD.DR WAS ALSO HEARD. 6. AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE A ND ALSO MATERIAL ON RECORD, I FIND THAT THE SAID PROPERTY HAS BEEN PURCHASED BY M/S.R AND D ENGINEERS, A PARTNERSHIP FI RM WHEREAS THE ASSESSEE IS A COMPANY. SINCE THESE DOCUM ENTS WERE NOT FILED EITHER BEFORE THE AO OR BEFORE THE CIT(A ), THEY WERE CONSTRAINED TO PASS EX-PARTE ORDER AND THE CIT(A) ALSO HELD THAT THE ASSESSEE WAS LIABLE TO PAY ADMITTED TAX U/S.249(4) OF THE ACT. HOWEVER, SINCE THE VERY ACQUIS ITION OF ITA NO. 1342/HYD/2019 :- 4 -: THE ASSET BY THE ASSESSEE IS CHALLENGED, THERE CANNOT B E ANY ADMITTED TAX PAYABLE BY THE ASSESSEE FOR ADMITTING THE AP PEAL BY THE CIT(A). THEREFORE, I DEEM IT FIT AND PROPER TO REMAND THE ISSUE BACK TO THE FILE OF AO FOR VERIFICATION OF THE SE PAPERS FILED BY THE ASSESSEE TO SUBSTANTIATE ITS CLAIM THAT THE PROPERTY IS NOT PURCHASED BY THE ASSESSEE, BUT THE SAME IS PURCH ASED BY THE PARTNERSHIP FIRM, AFTER GIVING THE ASSESSEE A FA IR OPPORTUNITY OF HEARING. HENCE, THE APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH NOVEMBER, 2019 SD/- (P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD, DATED: 11-11-2019 TNMM ITA NO. 1342/HYD/2019 :- 5 -: COPY TO : 1. RND WAFER MACHINES PRIVATE LIMITED, C/O. MOHD. A FZAL, ADVOCATE, #402, SHERSONS RESIDENCY, 11-5-465, CRIM INAL COURT ROAD, RED HILLS, HYDERABAD. 2. ASST.COMMISSIONER OF INCOME TAX(OSD), WARD-3(2), HYDERABAD. 3. CIT(APPEALS)-3, HYDERABAD. 4. PR.CIT-3, HYDERABAD. 5. D.R. ITAT, HYDERABAD. 6. GUARD FILE.