Income Tax Officer, Ward-3(2), Hyderabad V. Richmond Vivek Laboratoreis Private Limited, Hyderabad

ITA 1509/Hyd/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 7013 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 6 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-04-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB-A
• Assessment Year: 2014-2015
• Appeal Filed On: 04-10-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANJALA SAHU
• Keywords: TDS
• Section: 44AB

Judgement Text

ITA NO 1509 OF 2019 RICHMOND VIVEK LABS P LTD HYD ERABAD PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH, HYDERABAD (THROUGH VIDEO CONFERENCING) BEFORE SHRI S.S. GODARA, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER ITA NO.1509/HYD/2019 ASSESSMENT YEAR: 2014-15 INCOME TAX OFFICER WARD 3(2) HYDERABAD VS. M/S. RICHMOND VIVEK LABORATORIES P LTD HYDERABAD (APPELLANT) (RESPONDENT) REVENUE BY: SMT. ANJALA SAHU, DR ASSESSEE BY : NONE DATE OF HEARING: 23/03/2021 DATE OF PRONOUNCEMENT: 09/04/2021 ORDER PER S.S. GODARA, J.M. THIS REVENUES APPEAL FOR AY.2014-15 ARISES FROM TH E CIT(A)-3, HYDERABADS ORDER DATED 22.07.2019 PASSED IN APPEAL ITA NO.0633/ITO-3(2)/HYD/CIT(A)-3/2016-17 IN PROCEEDING S U/S143(3) OF THE INCOME TAX ACT, 1961 [IN SHORT, THE ACT]. HEARD BOTH THE PARTIES. CASE FILE PERUSED. NONE AP PEARED AT THE ASSESSEES BEHEST. IT IS ACCORDINGLY PROCEEDED EX-P ARTE. 2. THE REVENUES SOLE SUBSTANTIVE GROUND PLEADED IN THE INSTANT APPEAL SEEKS TO REVERSE THE CIT (A)S ACTIO N DELETING DISALLOWANCE/ADDITION OF RS.1,92,38,312/-ON ACCOUNT OF EXPENDITURE INCURRED VIDE FOLLOWING DETAILED DISCUS SION:- 3. THE CONTENTS OF THE REMAND REPORT OF THE AO, I. E. THE INCOME TAX OFFICER, WARD-3(3), HYDERABAD, AND THE FORWARDING REPORT OF THE ADD.CIT, RANGE- 3, HYDERAB AD AND ITA NO 1509 OF 2019 RICHMOND VIVEK LABS P LTD HYD ERABAD PAGE 2 OF 3 THE SUBMISSIONS OF THE APPELLANT HAVE BEEN DULY PER USED. IT IS SURPRISING THAT IN A TAX AUDIT CASE. WHERE THE A NNUAL REPORT OF THE APPELLANT COMPANY IS AVAILABLE ON REC ORD, THE ASSESSING OFFICER HAD DISALLOWED THE ENTIRE EXPENDI TURE CLAIMED BY THE APPELLANT ON THE GROUND OF NON PRODU CTION OF SUBSTANTIATING EVIDENCES. IT IS A WELL ESTABLISHED FACT THAT IN ANY BUSINESS THERE CANNOT BE INCOME WITHOUT EXPENDI TURE. IT IS NOTED THAT THE APPELLANT EXPRESSED HIS INABIL ITY OF PRODUCTION OF BILLS AND VOUCHERS AS DUE TO NON-PAYM ENT OF RENT TO THE OWNER OF THE APPELLANT'S BUSINESS PREMI SES AND HENCE THE APPELLANT WAS NOT ALLOWED TO ENTER INTO I TS OWN BUSINESS PREMISES BY THE OWNER OF BUSINESS PREMISES . THIS WAS BROUGHT TO NOTE IN THE REMAND PROCEEDINGS AS CA N BE SEEN FROM THE REMAND REPORT AND IT WAS ALSO BROUGHT TO NOTE DURING THE COURSE OF APPELLATE PROCEEDINGS BY THE AUTHORIZED REPRESENTATIVE OF THE APPELLANT COMPANY. IT WAS ALSO NOTICED DURING THE APPELLATE PROCEEDINGS T HAT THE APPELLANT WAS LOCKED OUT OF ITS OWN BUSINESS PREMIS E BY THE LAND OWNERS OF THE BUSINESS PREMISES AND THAT T HE APPELLANT SUBMITTED THE REASONS FOR NON-FURNISHING OF EVIDENCES WAS BEYOND THE CONTROL OF THE APPELLANT A ND THERE WERE COMPELLING REASONS DUE TO WHICH THE APPE LLANT COULD NOT PRODUCE THE BILLS AND VOUCHERS. HOWEVER, THE APPELLANT SUBMITTED THAT THE BOOKS OF THE APPELLANT COMPANY WERE AUDITED UNDER THE PROVISIONS OF SECTIO N 44AB OF INCOME TAX ACT, 1961 AND THAT THE ANNUAL RE PORT FOR F. Y.20 13- 14(A. Y.20 14- 15) WAS ALSO AVAILAB LE. CONSIDERING THE FACTS AND CIRCUMSTANCES AND THAT TH ERE IS REASONABLE OR SUFFICIENT CAUSE ON PART OF THE APPEL LANT COMPANY, IT IS JUSTIFIED AND REASONABLE TO DISALLOW THE APPELLANT'S CLAIM OF LOSS ARRIVE AT RS.38,507/- IN THE RETURN OF INCOME IN THE ABSENCE OF PROPER JUSTIFICATION FO R ITS CLAIM OF EXPENDITURE. IT IS ALSO NOTED THAT IN THE COMPUT ATION OF TOTAL INCOME, THE APPELLANT HAD DISALLOWED A SUM OF RS.5,20,228/_TOWARDS NON DEDUCTION OF TDS ETC. HOWE VER, THE ASSESSING OFFICER IS DIRECTED TO EXAMINE WHETHE R ANY STATUTORY GOVT. DUES SUCH AS TDS, GST ETC. ARE NOT REMITTED BY THE APPELLANT COMPANY IN TIME. IN CASE OF NON RE MITTANCE OF STATUTORY GOVT. DUES BY THE APPELLANT COMPANY, T HE ASSESSING OFFICER IS DIRECTED TO TAKE APPROPRIATE A CTION. HENCE THIS GROUND IN APPEAL IS PARTLY ALLOWED. 3. LEARNED CIT (DR) VEHEMENTLY CONTENDED DURING THE COURSE OF HEARING THAT THE CIT (A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE IMPUGNED MISC. EXPENDITURE DISALLOWANC E OF RS.1,92,38,312/- DESPITE THE FACT THAT THE ASSESSEE HAD FAILED TO PROVE THE SAME BY WAY OF FILING COGENT SUPPORTIVE E VIDENCE BEFORE THE ASSESSING OFFICER. WE FIND NO MERIT IN REVENUE S INSTANT GRIEVANCE. THERE IS NO DISPUTE QUA THE CLINCHING FA CT THAT THE ITA NO 1509 OF 2019 RICHMOND VIVEK LABS P LTD HYD ERABAD PAGE 3 OF 3 ASSESSEES BOOKS HAD BEEN DULY AUDITED AND ITS ANNU AL REPORT WAS ALSO AVAILABLE. AND THAT THE ASSESSING OFFICER HAD DISALLOWED ASSESSEES ENTIRE EXPENSES IN DRUG MANUFACTURING BU SINESS THEREBY ENHANCING ITS PROFIT TO THE MAXIMUM LEVEL. THE ASSESSEE HAS ALREADY EXPLAINED THE REASON OF NON-PRODUCTION OF AUDITED BOOKS OF ACCOUNT TO THE FACT THAT THERE WAS A TENAN CY DISPUTE CULMINATING IN LOCKED UP PREMISES IN THE CORRESPOND ING SPAN OF TIME. SO FAR AS THE REVENUES CASE THAT THE CIT (A) DELETED THE IMPUGNED DISALLOWANCE WITHOUT VERIFICATION, IT HAS COME ON RECORD THAT HE HAD DULY SOUGHT FOR A REMAND REPORT FROM TH E ASSESSING OFFICERS SIDE. WE THEREFORE FIND NO REASON TO REVI VE THE IMPUGNED DISALLOWANCE GOING BY THE REVENUES PLEADINGS. ITS SOLE GRIEVANCE FAILED ACCORDINGLY. 4. THIS REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 9 TH APRIL, 2021. SD/- SD/- (LAXMI PRASAD SAHU) ACCOUNTANT MEMBER (S.S. GODARA) JUDICIAL MEMBER HYDERABAD, DATED 9 TH APRIL, 2021. VINODAN/SPS COPY TO: 1 ITO WARD 3(2) HYDERABAD 2 C/O SRI N. VENKATARAM, CA, D. NO.1-10-63/16 CHIKO TI GARDENS, BEGUMPET, HYDERABAD 500016 3 CIT (A)-3 HYDERABAD 4 PR. CIT 3, HYDERABAD 5 THE DR, ITAT HYDERABAD 6 GUARD FILE BY ORDER