Aysha Traders, CHENNAI V. ITO, Ooty

ITA 1569/CHNY/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 8049 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-11-2016
• Appeal Filed By: Assessee
• Bench Allotted: C
• Next Hearing Date: 24-11-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 30-05-2016
• Court: TRIBUNAL
• Department Lawyers: MR ASHISH TRIPATHIJCIT D R
• Assessee Lawyers: S SRIDHAR

Judgement Text

, SMC/C , IN THE INCOME TAX APPELLATE TRIBUNAL SMC/C BENCH, CHENNAI . , BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER ./ I.T.A.NO.1569 /MDS./2016 ( / ASSESSMENT YEAR :2011-12) M/S.AYSHA TRADERS , 10/716B,CHUNGAM,GUDALUR, NILGIRIS 643 212. VS. THE ITO, WARD-1(1), OOTY. PAN AAJFA 4050 B ( / APPELLANT ) ( / RESPONDENT ) !' # $ / APPELLANT BY : MR.S.SRIDHAR, ADVOCATE %&!' # $ / RESPONDENT BY : MR. MR. ASHISH TRIPATHI,JCIT, D.R ' ( # ) * / DATE OF HEARING : 24.11.2016 +, # ) * /DATE OF PRONOUNCEMENT : 24.11.2016 / O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER: THIS APPEAL IS FILED BY THE ASSESSEE, AGGRIEVED B Y THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX(A)-3, COIMBA TORE DATED 26.02.2016 IN ITA NO.89/14-15(A)-1, DATED 26.02.201 6 PASSED UNDER SEC.143(3) OF THE ACT. 2. THE MAIN GRIEVANCE OF THE ASSESSEE IN THIS APPE AL IS THAT THE LD. CIT (A) ERRED IN CONFIRMING THE ASSESSMENT OF ` 17,46,500/- ITA NO.1569/MDS/2016 2 REPRESENTING THE TRADE CREDIT RELATABLE TO M/S.THOM AS BROTHERS FOR SUPPLY OF PEPPER IN TWO INVOICES/BILLS DATED 14.02. 2011 AND 04.01.2011 AS INCOME OF ASSESSEE IN THE COMPUTATION OF TAXABLE TOTAL INCOME WITHOUT ASSIGNING PROPER REASONS AND JUSTIF ICATION. 3. THE FACTS OF THE ISSUE ARE THAT THERE WAS A CRED IT OF ` 17,46,500/- IN THE NAME OF M/S.THOMAS BROTHERS. TH E AO SUMMONED THE CREDITOR MR.V.J.THOMAS. IN RESPONSE T O NOTICE ISSUED BY THE AO, HIS BROTHER MR.V.J.JOSEPH APPEARED STATI NG THAT MR.V.J.THOMAS WAS UNWELL AND ADMITTED TO THE HOSPIT AL. MR.V.J.JOSEPH SUBMITTED BEFORE THE AO THAT MR.V.J.T HOMAS SUPPLIED PEPPER TO THE ASSESSEE AND THE AMOUNT OUTSTANDING IS RELATING TO PURCHASE OF PEPPER FROM MR.V.J.THOMAS. HOWEVER, TH E SAID AMOUNT WAS NOT SHOWN AS RECEIVABLE IN THE BOOKS OF ACCOUNT S OF M/S.THOMAS BROTHERS. HENCE, THE AO TREATED IT UNEXPLAINED CRED IT IN THE HANDS OF ASSESSEE I.E MR.V.J.THOMAS. AGGRIEVED, THE ASSESSEE CARRIED THE APPEAL BEFORE THE LD.CIT(A). ON APPEAL, LD.CIT(A) CONFIRMED THE ORDER OF AO. AGAINST THIS, THE ASSESSEE IS IN APPEA L BEFORE US. ITA NO.1569/MDS/2016 3 4. THE LD.A.R SUBMITTED THAT THIS IS A TRADE CREDI TOR OUTSTANDING REGARDING PURCHASE OF PEPPER AND THE AO ACCEPTED TH E PURCHASES AND ALSO THE PURCHASER ACCEPTED THE CORRESPONDING C REDITS TO BE CONSIDERED AS GENUINE AND HE CANNOT TREAT IT AS UNA CCOUNTED CREDIT U/S.68 OF THE ACT. IF THE AO NOT AGREED WITH THE S UBMISSIONS OF MR.V.J.JOSEPH, THEN HE SHOULD HAVE SUMMONED THE REL EVANT DOCUMENTS FROM THE CREDITOR AND EXAMINED IT. ACCORD ING TO HIM, IN THE PRESENT CASE, IT IS AN ADMITTED FACT THAT MR.V.J.TH OMAS WAS HOSPITALIZED AND THEREAFTER HE DIED. IT IS IMPOSSI BLE TO GET ANY CONFIRMATION MR.V.J.THOMAS, AS SUCH THE BOOKS OF AC COUNTS OF M/S.THOMAS BROTHERS MAY BE SUMMONED AND IT IS TO BE EXAMINED WHETHER IT IS GENUINE PURCHASE OR NOT. 5. ON THE OTHER HAND, LD.D.R RELIED ON THE ORDER O F THE LOWER AUTHORITIES. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. WE FIND FORCE IN THE ARGUMENT OF THE LD.A.R THAT IF THE AO ACCEPT THE PURCHASE MADE FROM M/S.THOMAS BROTHERS A ND THE PERSON CONCERN WAS HOSPITALIZED, THE AO SHOULD HAVE SUMMON ED THE BOOKS OF ACCOUNTS OF M/S.THOMAS BROTHERS AND EXAMINED WH ETHER THE ITA NO.1569/MDS/2016 4 PURCHASE WAS ACTUALLY MADE OR NOT AND THEREAFTER, H E COULD HAVE DECIDED THE ISSUE. SINCE THE AO HAD NOT CARRIED ON THE ENQUIRY TO THE LOGICAL END, IN OUR OPINION IT IS APPROPRIATE TO RE MIT TO THE FILE OF AO TO RE-EXAMINE THE ISSUE AFTER GIVING OPPORTUNITY OF HE ARING TO THE ASSESSEE. ACCORDINGLY, THIS ISSUE IS REMITTED TO TH E FILE OF AO FOR FRESH CONSIDERATION. 7. IN THE RESULT, THE APPEAL OF ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 24 TH NOVEMBER, 2016 AT CHENNAI. SD/- ( ) ( CHANDRA POOJARI ) /ACCOUNTANT MEMBER CHENNAI, DATED THE 24 TH NOVEMBER, 2016. K S SUNDARAM. - # %)./ 0/ ) / COPY TO: 1 . !' / APPELLANT 3. ' 1) () / CIT(A) 5. /4 5 %)6 / DR 2. %&!' / RESPONDENT 4. ' 1) / CIT 6. 5 7 8 ( / GF