DCIT, Pune V. Shri Avdhoot Sarvottam Kulkarni, Pune

ITA 1582/PUN/2012

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 72285 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 3 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-10-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2007-2008
• Appeal Filed On: 26-07-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P L PATHADE
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES A, PUNE BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER ITA NO.1582/PN/2012 (ASSESSMENT YEAR : 2007-08) DY. COMMISSIONER OF INCOME TAX, CIRCLE 3, PUNE . APPELLANT VS. SHRI AVDHOOT SARVOTTAM KULKARNI, PROP. MARKETING MULTIPLIERS, 1206/B-1, BUTE PATIL CHAMBERS, J.M. ROAD, PUNE 411 004. PAN : ABEPK3975H . RESPONDENT C.O. NO.59/PN/2013 (ARISING OUT OF ITA NO.1582/PN/2012) (ASSESSMENT YEAR : 2007-08) SHRI AVDHOOT SARVOTTAM KULKARNI, PROP. MARKETING MULTIPLIERS, 1206/B-1, BUTE PATIL CHAMBERS, J.M. ROAD, PUNE 411 004. PAN : ABEPK3975H . APPELLANT VS. DY. COMMISSIONER OF INCOME TAX, CIRCLE 3, PUNE . RESPONDENT DEPARTMENT BY : MR. P. L. PATHADE ASSESSEE BY : MR. M. K. KULKARNI DATE OF HEARING : 23-10-2013 DATE OF PRONOUNCEMENT : 28-10-2013 ORDER PER G. S. PANNU, AM THE CAPTIONED APPEAL BY THE REVENUE AND THE CROSS- OBJECTION BY THE ASSESSEE IS DIRECTED AGAINST AN ORDER OF THE COMMIS SIONER OF INCOME TAX (APPEALS)-II, PUNE DATED 26.03.2012 WHICH, IN TURN, HAS ARISEN FROM AN ORDER DATED 29.12.2009 PASSED BY THE ASSESSING OFFICER, U NDER SECTION 143(3) OF THE INCOME-TAX ACT, 1961 (IN SHORT THE ACT), PERTAINING TO THE ASSESSMENT YEAR 2007-08. ITA NO.1582/PN/2012 C.O. NO.59/PN/2013 A.Y. 2007-08 2. IN THIS APPEAL, ALTHOUGH THE REVENUE HAS RAISED MULTIPLE GROUNDS OF APPEAL BUT ESSENTIALLY THE SOLITARY ISSUE IS WITH R EGARD TO AN ADDITION OF RS.13,39,174/- MADE BY THE ASSESSING OFFICER INVOKI NG SECTION 41(1) OF THE ACT, WHICH HAS SINCE BEEN DELETED BY THE CIT(A). 3. IN BRIEF, THE FACTS RELEVANT CAN BE SUMMARIZED A S FOLLOWS. THE ASSESSEE IS AN INDIVIDUAL WHO IS ENGAGED IN THE BUSINESS OF RE-SALE OF PACKING MATERIAL. IN THE COURSE OF ASSESSMENT PROCEEDINGS, ASSESSEE W AS ASKED TO FURNISH THE DETAILS OF SUNDRY CREDITORS AND THEIR CONFIRMATIONS . THE ASSESSING OFFICER NOTICED THAT IN RELATION TO TWO SUNDRY CREDITORS, N AMELY, M/S J. VEE ENTERPRISES AND M/S YAJ-CRAFT, THERE WAS A DIFFERENCE IN THE BA LANCES AS SHOWN IN THE ASSESSEES BOOKS OF ACCOUNT WITH THAT SHOWN IN THE BOOKS OF THE RESPECTIVE CREDITORS. SUCH DIFFERENCE AMOUNTED TO RS.13,39,174 /-, AND THE SAME WAS TREATED AS CESSATION OF LIABILITY BY THE ASSESSING OFFICER, AS ACCORDING TO HIM THE CREDITORS WERE NOT CLAIMING SUCH AMOUNT, AND TH US THE AMOUNT WAS TAXED UNDER SECTION 41(1) OF THE ACT. 4. IN APPEAL BEFORE THE CIT(A), APART FROM OTHER AR GUMENTS, ASSESSEE FURNISHED A RE-CONCILIATION OF THE ACCOUNT MAINTAIN ED BY THE ASSESSEE IN HIS BOOKS OF ACCOUNT AND THE ACCOUNT MAINTAINED BY THE CREDITORS. THE ASSESSEE POINTED OUT THAT IN THE CASE OF M/S YAJ-CRAFT THERE WERE CERTAIN PAYMENTS MADE BY ACCOUNT PAYEE CHEQUES, WHICH WERE NOT ENTER ED BY THE CREDITOR IN HIS BOOKS OF ACCOUNT AND FURTHER CERTAIN BILLS ISSUED W ERE ALSO NOT ACCOUNTED FOR BY THE CREDITOR. WITH REGARD TO THE M/S J. VEE ENTE RPRISES, ASSESSEE FURNISHED AN AFFIDAVIT OF THE CREDITOR AVERRING THAT THE DIFF ERENCE WAS ONLY ON ACCOUNT OF A WRONG ENTRY MADE BY THE CREDITOR IN HIS BOOKS OF AC COUNT. ON THE BASIS OF AFORESAID EXPLANATION, ASSESSEE POINTED OUT THAT TH ERE WAS NO DIFFERENCE BETWEEN THE BALANCES OF THE TWO SUNDRY CREDITORS AS APPEARING IN THE ASSESSEES BOOKS OF ACCOUNT UPON COMPARISON WITH TH E BALANCES APPEARING IN THE BOOKS OF THE CREDITORS. THE CIT(A) CONSIDERED T HE EXPLANATION AND THE ITA NO.1582/PN/2012 C.O. NO.59/PN/2013 A.Y. 2007-08 MATERIAL PUT-FORTH BY THE ASSESSEE AND CALLED FOR A REMAND REPORT FROM THE ASSESSING OFFICER WITH RESPECT TO THE SUBMISSIONS P UT-FORTH BY THE ASSESSEE. THE ASSESSING OFFICER VIDE HIS REMAND REPORT DATED 13.02.2011 SUBMITTED THAT THE BALANCES OF THE CREDITORS AS SHOWN BY THE ASSES SEE WERE TALLYING WITH THE BALANCES SHOWN BY THE SUNDRY CREDITORS AND THEREFOR E THE ADDITION MADE ON THE BASIS OF AN INCORRECT CONFIRMATION AT THE TIME OF ASSESSMENT PROCEEDINGS WOULD NOT PERSIST . 5. THE CIT(A) CONSIDERED THE MATERIAL PUT-FORTH BY THE ASSESSEE AND ALSO THE REMAND REPORT OF THE ASSESSING OFFICER AND DELE TED THE ADDITION OF RS.13,39,174/- MADE BY THE ASSESSING OFFICER. AGAIN ST SUCH DELETION, REVENUE IS IN APPEAL BEFORE US. 6. AT THE TIME OF HEARING, THE LEARNED DEPARTMENTAL REPRESENTATIVE APPEARING FOR THE REVENUE HAS NOT CONTROVERTED THE REMAND REPORT OF THE ASSESSING OFFICER DATED 13.02.2011 ADDRESSED TO THE CIT(A) WHEREIN IT IS OBSERVED THAT THERE WAS NO DIFFERENCE IN THE BALANC ES OF THE SUNDRY CREDITORS AS DECLARED BY THE ASSESSEE VIS--VIS THE BALANCES SHOWN BY THE SUNDRY CREDITORS IN THEIR BOOKS OF ACCOUNT. IT IS ALSO NOT DISPUTED THAT THE ADDITION HAS BEEN DELETED BY THE CIT(A) ON THE BASIS OF THE RE-C ONCILIATION OF THE SUNDRY CREDITORS BALANCES FURNISHED BY THE ASSESSEE, WHIC H WAS BASED ON THE RELEVANT MATERIAL. IT IS ALSO NOT DISPUTED BEFORE U S THAT IN THE REMAND PROCEEDINGS, THE ASSESSING OFFICER EXAMINED SUCH MA TERIAL AND NO INFIRMITY IN THE SAME WAS FOUND. 7. IN VIEW OF THE AFORESAID, WE THEREFORE FIND NO R EASONS TO INTERFERE WITH THE ORDER OF THE CIT(A) DELETING THE IMPUGNED ADDIT ION. SO, HOWEVER, IT IS CANVASSED ON BEHALF OF THE REVENUE THAT THE CIT(A) OUGHT TO HAVE EXAMINED BOTH THE CREDITORS BEFORE DELETING THE IMPUGNED ADD ITION AND THAT THE CIT(A) ITA NO.1582/PN/2012 C.O. NO.59/PN/2013 A.Y. 2007-08 ERRED IN ACTING UPON THE CONFIRMATIONS GIVEN BY THE CONCERNED CREDITORS. IN THIS MANNER, THE ORDER OF THE CIT(A) IS SOUGHT TO BE ASS AILED. 8. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS PUT -FORTH BY THE REVENUE AND FIND THAT NO JUSTIFICATION IN THE SAME. OSTENSIBLY, THE RE-CONCILIATION OF ACCOUNTS, EXTRACT COPY OF THE LE DGER ACCOUNT AND THE EXPLANATION FOR THE DIFFERENCE NOTED AT THE TIME OF ASSESSMENT PROCEEDINGS, ETC. WERE FORWARDED BY THE CIT(A) TO THE ASSESSING OFFICER REQUIRING HIM TO EXAMINE SUCH MATERIAL AND THEREAFTER SEND A REMAND REPORT TO HIM. THE OPERATIVE PART OF THE ORDER UNDER SECTION 250(4) OF THE ACT DATED 10.08.2011 MADE BY THE CIT(A) IN THIS REGARD HAS BEEN REPRODUC ED IN PARA 3.2 OF HIS ORDER. IT IS CLEAR THAT THE ENTIRE MATERIAL CONSIDE RED BY THE CIT(A) TO DELETE THE ADDITION WAS MADE AVAILABLE TO THE ASSESSING OFFICE R IN THE REMAND PROCEEDINGS. THE ASSESSING OFFICER DID NOT FIND ANY INFIRMITY IN THE SAME, AND RATHER HE CONFIRMED IN THE REMAND PROCEEDINGS THAT THE ADDITION WAS MADE ON THE BASIS OF AN INCORRECT CONFIRMATION AND WOULD NOT PERSIST . NOTABLY, NO DISCREPANCY WAS FOUND IN THE MATERIAL BEING CANVASS ED BY THE ASSESSEE IN SUPPORT OF HIS ASSERTION THAT THE IMPUGNED ADDITION WAS NOT MAINTAINABLE. EVEN BEFORE US, NO MATERIAL HAS BEEN LEAD BY THE RE VENUE TO CONCLUDE TO THE CONTRARY. THEREFORE, IN OUR VIEW, THE ORDER OF THE CIT(A) DESERVES TO BE AFFIRMED, WHICH WE HOLD SO. 9. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. 10. THE CROSS-OBJECTION PREFERRED BY THE ASSESSEE I S ONLY IN SUPPORT OF THE ORDER OF THE CIT(A), WHICH WE HAVE ALREADY AFFIRMED IN THE FOREGOING PARAGRAPHS. THUS, THE CROSS-OBJECTION IS ALSO DISMI SSED, AS INFRUCTUOUS. 11. RESULTANTLY, THE APPEAL OF THE REVENUE AS WELL AS THE CROSS-OBJECTION FILED BY THE ASSESSEE IS DISMISSED, AS ABOVE. ITA NO.1582/PN/2012 C.O. NO.59/PN/2013 A.Y. 2007-08 ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH OCTOBER, 2013. SD/- SD/- (R.S. PADVEKAR) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE, DATED: 28 TH OCTOBER, 2013 SUJEET COPY OF THE ORDER IS FORWARDED TO : - 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A)-II, PUNE; 4) THE CIT-II, PUNE; 5) THE DR, A BENCH, I.T.A.T., PUNE; 6) GUARD FILE. BY ORDER //TRUE COPY// SR. PRIVATE SECRETARY I.T.A.T., PUNE