Bhawani Shankar , Sumerpur, Pali V. ACIT,Circle, Pali

ITA 137/JODH/2019

• Counselvise Citation: [2020] 109 COUNSELVISE.COM (IT) 9979 (ITAT-JODHPUR)
• Duration Of Justice: 1 year(s) 8 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-12-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2015-2016
• Appeal Filed On: 12-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K.C. BADHOK LD.
• Keywords: Retraction
• Section: 143(3); 133A

Judgement Text

1 ITA NO.137/JODH/2019 SHRI BHAWANI SHANKAR ASSESSMENT YEAR: 2015-16 IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH , , BEFORE HONBLE SHRI SANDEEP GOSAIN, JM AND HONBLE SHRI MANOJ KUMAR AGGARWAL, AM (HEARING THROUGH VIDEO CONFERENCING MODE) ./ I.T.A. NO.137/JODH/2019 ( / ASSESSMENT YEAR: 2015-16) SHRI BHAWANI SHANKAR SUMERPUR, DIST.PALI C/O RAJENDRA JAIN ADVOCATE 106, AKSHAY DEEP COMPLEX, 5TH B ROAD SARDARPURA, JODHPUR,RAJASTHAN-342 001 / VS. A CIT CIRCLE PALI RAJASTHAN ./ ./PAN/GIR NO. ACPPS-8740-N ( /APPELLANT ) : ( / RESPONDENT ) ASSESSEE BY : SHRI RAJENDRA JAIN (ADVOCATE) & MS. RAKSHA BIRLA (CA) LD.ARS. REVENUE BY : SHRI K.C. BADHOK- LD. CIT- DR / DATE OF HEARING : 06/11/2020 / DATE OF PRONOUNCEMENT : 21/12/2020 / O R D E R MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER): - 1. AFORESAID APPEAL BY ASSESSEE FOR ASSESSMENT YEAR [IN SHORT REFERRED TO AS AY] 2015-16 CONTEST THE ORDER OF L D. COMMISSIONER OF INCOME-TAX (APPEALS)-1, JODHPUR, [IN SHORT REFER RED TO AS 2 ITA NO.137/JODH/2019 SHRI BHAWANI SHANKAR ASSESSMENT YEAR: 2015-16 CIT(A)], VIDE APPEAL NO.204/2017-18, DATED 06/02/ 2019 ON FOLLOWING EFFECTIVE GROUNDS:- 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE ID CIT (A) ERRED IN CONFIRMING ADDITION OF RS.13,56,321/- IN RESPE CT OF EXCESS STOCK . 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE ID CIT (A) ERRED IN SUSTAINING ADDITION OF EXCESS STOCK ON THE BASIS OF STATEMENT OF ASSESSEE RECORDED AT THE TIME OF SURVEY WITHOUT CONSIDERING THE FACTS THAT THERE WAS MISTAKE ON THE PART OF SURVEY WHILE WORKED OUT EXCE SS STOCK. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE ID CIT (A) GROSSLY ERRED IN IGNORING THE EXPLANATION FURNISHED BY THE ASSESSEES WHICH WERE SUPPORTED FROM DOCUMENTARY EVIDENCES. 4. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE ID CIT (A) GROSSLY ERRED IN UPHOLDING VARIOUS OBSERVATION MADE BY THE LD. AO IN THE ASSESSMENT ORDER WHICH IS CONTRARY TO FACTS AND MAT ERIAL AVAILABLE ON RECORDS. AS EVIDENT, THE ASSESSEE IS AGGRIEVED BY CONFIRMATI ON OF CERTAIN ADDITION OF EXCESS STOCK. 2. WE HAVE CAREFULLY HEARD THE RIVAL SUBMISSIONS AN D PERUSED RELEVANT MATERIAL ON RECORD INCLUDING SUBMISSIONS M ADE DURING THE COURSE OF HEARING. THE CASE LAWS AS CITED DURING TH E COURSE OF HEARING HAVE DULY BEEN DELIBERATED UPON. OUR ADJUDI CATION TO THE SUBJECT MATTER WOULD BE AS GIVEN IN SUCCEEDING PARA GRAPHS. 3. FACTS ON RECORD WOULD REVEAL THAT ASSESSEE BEING RESIDENT INDIVIDUAL IS STATED TO BE ENGAGED IN TRADING OF HA NDICRAFT RELIGIOUS GOODS RELATED TO TEMPLES AND SUTHARI WORK OF TIMBER. IT WAS ASSESSED U/S. 143(3) ON 15/12/2017 WHEREIN IT WAS S ADDLED WITH AN ADDITION OF RS.13.56 LACS ON ACCOUNT OF EXCESS STOC K. THE ASSESSEE WAS SUBJECTED TO SURVEY PROCEEDINGS ON 08/ 01/2015 DURING WHICH IT SURRENDERED EXCESS CASH FOR RS.3.01 LACS AND EXCESS STOCK FOR RS.32.02 LACS. HOWEVER, AROUND AFT ER ONE MONTH I.E. ON 16/02/2015,THE ASSESSEE SUBMITTED THAT DUE TO MISTAKE IN MEASURING THE WOOD AND ITS VALUATION, THE STOCK WAS OVERVALUED BY 3 ITA NO.137/JODH/2019 SHRI BHAWANI SHANKAR ASSESSMENT YEAR: 2015-16 RS.13.56 LACS BY THE SURVEY TEAM PRESENT AT THE BUS INESS PREMISES OF THE ASSESSEE. DURING THE COURSE OF ASSESSMENT PR OCEEDINGS, THE ASSESSEE REITERATED THAT THERE WAS CALCULATION MIST AKE IN THE STOCK INVENTORY TAKEN BY THE SURVEY TEAM WHICH CAME TO KN OWLEDGE OF THE ASSESSEE AFTER COMPLETION OF SURVEY. HOWEVER, GOING BY THE REPLIES GIVEN BY ASSESSEE BEFORE SURVEY TEAM, LD. AO NOTED THAT THE VALUATION OF STOCK WAS DONE AS PER HIS DIRECTIONS O NLY AND THE ASSESSEE TOTALLY AGREED WITH THE VALUATION SO DONE. THEREFORE, NOT CONVINCED, THE AMOUNT OF RS.13.56 LACS WAS ADDED TO THE INCOME OF THE ASSESSEE. 4. BEFORE LD. CIT(A), THE ASSESSEE, INTER-ALIA, SUBMITTED THAT VALUATION WAS MADE AND STATEMENTS WERE FINALIZED IN LATE NIGHT AND THEREFORE THE VALUATION AS ACCEPTED UNDER UNDUE PRE SSURE. IT WAS SUBMITTED THAT ADDITIONS WERE MADE WHOLLY ON THE BA SIS OF STATEMENT OF THE ASSESSEE AND STATEMENT RECORDED U/ S 133A WOULD NOT HAVE MUCH EVIDENTIARY VALUE. POINTING TO THE MI STAKE, IT WAS SUBMITTED THAT THE VOLUME OF SOLID TIMBER WAS TO BE MEASURED IN CUBIC FEET AND THE SAME WAS TO BE ARRIVED AT AFTER MULTIPLYING ALL THE THREE DIMENSIONS VIZ. LENGTH, BREADTH & HEIGHT WHER EAS THE SURVEY TEAM ONLY MULTIPLIED TWO ITEMS WHICH WAS WRONG AND THE SAME LED TO CALCULATION ERRORS. SIMILAR OTHER ERRORS THAT CR EPT INTO THE CALCULATIONS WERE ALSO POINTED OUT. HOWEVER, LD. CI T(A) OPINED THAT THE RETRACTION WAS NOT SUPPORTED WITH ANY CONCRETE EVIDENCE AND THE SUBMISSIONS WERE MERE AFTERTHOUGHT. THEREFORE, THE ADDITIONS WERE CONFIRMED. AGGRIEVED, THE ASSESSEE IS IN FURTH ER APPEAL BEFORE US. 4 ITA NO.137/JODH/2019 SHRI BHAWANI SHANKAR ASSESSMENT YEAR: 2015-16 5. IT IS SETTLED LAW THAT STATEMENTS RECORDED U/S 1 33A DURING SURVEY OPERATIONS WOULD NOT CARRY MUCH EVIDENTIARY VALUE UNLESS THE SAME IS CORROBORATED WITH MATERIAL EVIDENCES. T HE ASSESSEE WOULD BE WITHIN HIS RIGHT TO RETRACT THE SAME IN TH E LIGHT OF EVIDENCES AS WELL AS FRESH FACTS EMERGING OUT SUBSEQUENT TO C ONCLUSION OF SURVEY PROCEEDINGS. UPON PERUSAL OF ASSESSEES SUBM ISSIONS BEFORE LD. FIRST APPELLATE AUTHORITY, WE FIND THAT THERE WERE CALCULATIONS ERRORS WHICH WERE SOUGHT TO BE RECTIFI ED BY WAY OF RETRACTION. THE ASSESSEE WAS DEALING IN SOLID WOOD WHICH WAS TO BE MEASURED IN CUBIC FEET ONLY AND THE SAME WAS TO BE ARRIVED AT AFTER MULTIPLYING ALL THE THREE DIMENSIONS VIZ. LENGTH, B READTH & HEIGHT. AS AGAINST THIS SURVEY TEAM ONLY MULTIPLIED TWO ITEMS WHICH WAS PATENTLY WRONG AND WOULD CERTAINLY GIVE WRONG COMPU TATIONS. SIMILAR OTHER MISTAKES HAVE ALSO BEEN POINTED OUT W HICH ARE ALREADY EXTRACTED IN THE IMPUGNED ORDER. IT IS ALSO NOTICEABLE THAT THE ASSESSEE HAS NOT DENIED THE FACTUM OF EXCESS ST OCK BUT MERELY SEEK RECTIFICATION OF COMPUTATIONAL ERRORS. THE ITE M-WISE DETAILS OF THE MISTAKE WERE PLACED ON RECORD AND THE SAME HAS ALSO BEEN PLACED BEFORE US ALSO. WE FIND THAT THE ASSESSEE HA S COMPUTED COMPUTATIONAL ERRORS FOR EACH OF THE ITEM SPECIFICA LLY AND ARRIVED AT CORRECT VALUATION THEREOF. THEREFORE, THE RETRACTIO N COULD NOT BE BRUSHED ASIDE SIMPLY. IN FACT, NO ERROR HAS BEEN PO INTED OUT IN THE COMPUTATION SO MADE BY THE ASSESSEE. OUR VIEW IS DU LY SUPPORTED BY ANOTHER DECISION OF COORDINATE BENCH OF THIS TRI BUNAL IN M/S SHRINATH GUM & CHEMICALS V/S ITO (ITA NO.527/JU/200 9 DATED 09/12/2011) WHICH HAS TAKEN A VIEW THAT THE ADDITIONS COULD NOT BE 5 ITA NO.137/JODH/2019 SHRI BHAWANI SHANKAR ASSESSMENT YEAR: 2015-16 MADE MERELY ON THE BASIS OF THE SURVEY STATEMENT. S IMILAR IS THE VIEW OF JAIPUR TRIBUNAL IN SATISH CHAND AGARWAL V/S ITO (ITA NO.311/JP/2015 DATED 12/04/2018) WHICH HAS ALSO TAKEN SIMILAR VIEW. DERIVING STRENGTH FROM THE SAME, WE DELETE TH E ADDITION OF RS.13.56 LACS AND ALLOW THE APPEAL. 6. IN NUTSHELL, THE APPEAL STANDS ALLOWED. ORDER PRONOUNCED U/R 34(4) OF INCOME TAX (APPELLATE TRIBUNAL) RULES, 1963. SD/- SD/- (SANDEEP GOSAIN) (MANOJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 21/12/2020 SR.PS:-JAISY VARGHESE ! / COPY OF THE ORDER FORWARDED TO : 1. ' / THE APPELLANT 2. #$' / THE RESPONDENT 3. % ( ) / THE CIT(A) 4. % / CIT CONCERNED 5. &'#( ) , ) , / DR, ITAT, JODHPUR 6. '+,- / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, JODHPUR.