The ITO, Ward-1, Palanpur V. Shri Virat Jormalbhai Chokshi, Palanpur

ITA 1586/AHD/2012

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 1003 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 11 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-07-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 08-06-2016
• Assessment Year: 2004-2005
• Appeal Filed On: 20-07-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: M K PATEL

Judgement Text

ITA NO. 1586 /AHD/201 2 A.Y . 20 0 4 - 05 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH, SMC , AHMEDABAD BEFORE SHRI R.P. TOLANI, JUDICIAL MEMBER I TA NO. 1586 /AHD /201 2 ASSESSMENT YEAR: 20 0 4 - 05 INCOME TAX OFFICER, VS. SHRI VIRAT JORMALBHAI CHOKSHI, WARD - 1 , PALANPUR . C/O. JITUBHAI CHOKSHI, MOTI BAZAR, TOWER ROAD, PALANPUR. [PAN: ABBPC 1605 M] (APPELLANT ) (RESPONDENT) APPELLANT BY : S HRI MADHUSUDAN, SR. D.R. RESPONDENT BY : SHRI M.K. PATEL, A.R. DATE OF HEARING : 0 8 .0 6 . 20 16 DATE OF PRONO UNCEMENT : 15 . 0 7 .2016 O R D E R 1. THIS IS REVENUE S APPEAL. THE SOLE ISSUE RAISED IN THIS APPEAL READ AS UNDER: - THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - XX, AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN DELETING T HE DISALLOWANCE OF PAYMENT AMOUN TING TO RS.43,66,835/ - MAD TO SHRI MAGA N LAL P. PATEL. 2. THE FACTS AND REASONS FOR CONCLUSIONS AS CULLED OUT FROM THE RELEVANT PARA GRAPHS OF THE ASSESSING OFFICER AND THE LEARNED CIT ( A ) ARE AS UNDER : - A.O. AS NEITHER SHRI MAGA N LAL PURSHOTTAMDAS PATEL, ATTENDED IN PERSON NOR ANY EVIDENCE TO THE EFFECT THAT THE ABOVE PERSON WAS CARRYING ON BUSINESS A T N A V S ARI, AND HE WORKED FOR THE ASSESSEE, NOR THE ASSESSEE A BLE TO PRODUCE HIM FOR VERIFICATION. IN ABSENCE OF ANY EVIDENCES IN SUPPORT OF THE PAYMENT MADE TO MANGALAL PU R SHOTTAMDAS PATEL, IT IS HELD THAT THE PAYMENTS OF RS.43,66,835/ - MADE TO SHRI MAGANLAL PURSHOTAMDAS PAT E L ARE BOGUS PAYMENT TO REDUCE PROFIT OF THE ASSESSEE . ACCORDINGLY , TH E SAME IS ADDED TO THE TOTAL INCOME DECLARED. PROCEEDINGS UNDER S ECTION 274 READ WITH SECTION 271(1)(C) ARE INITIATED FOR FURNISHING INACCURATE PARTICULARS OF INCOME. CIT(A) 4.3 AS SEEN FROM THE PAPER BOOK FURNISHED BY T HE LD. A .R., DURING THE COURSE OF ASSESSMENT PROCEEDINGS, APPELLANT FURNISHED COPY OF RETURN OF I NCOME FILED BY SHRI MAGANLAL P. PATEL, COPY OF CERTIFICATE ISSUED BY ITO FOR DEDUCTION OF TAX AT LOWER RATE ON T HE PAYMENTS BEING MADE TO THE S AID PARTY, ITA NO. 1586 /AHD/201 2 A.Y . 20 0 4 - 05 PAGE 2 OF 3 COPY OF BANK ACCOUNT EVIDENCING PAYMENTS TO THE SAID PARTY ETC. IN SUPPORT OF THE GENUINENESS OF THE E XPENDITURE. MERE NON - PRODUCTION OF THE PERSON BEFORE THE AO THAT TOO AFTER TIME LAG OF 7 YEARS FROM THE YEAR OF TRANSACTIONS CANNOT BE THE SOLE BASIS FOR MAKING THE DISALLOWANCE. THE CONTENTION OF THE LD. A.R. THAT WITHOUT PAY ING LABOUR CHARGES, THE BUSIN ESS OF THE APPELLANT COULD NOT HAVE BEEN CARRIED ON STANDS TO REASON. SINCE THE APPELLANT FURNISHED ALL THE NECE SS ARY DETAILS HE WAS CAPABLE OF AND S INCE NO MATERIAL IS BROUGHT ON RECORD TO CONTROVERT T HE CONTENTIONS OF T HE APPELLANT, IMPUGNED DISALLOWANC E IS NOT SUSTAINABLE. IT IS DELETED. THESE GROUND OF APPEAL RE ALLOWED. 3. LEARNED DEPARTMENTAL REPRESENTATIVE SUPPORTED THE ORDER OF THE ASSESSING OFFICER. 4. LEARNED COUNSEL FOR THE ASSESS E E V EHEMENTLY CONTENDS THAT THE OBSERVATION OF THE ASSESSIN G OFFICER THAT NOTHING W AS PRODUCED BEFORE HIM IS PATENTLY WRONG IN ASMUCH AS THE LEARNED CIT(A), AF T ER DUE VERIFICATION OF THE ASSESSMENT R ECO R DS , HAS GIV E N A FACTUAL FINDING TH A T DURING T HE COURSE OF ASSESSMENT PROCEEDINGS, ASSESSEE FURNISHED COPY OF RET URN OF INCOME FILED BY SHRI MAGANLAL P . PATEL, COPY OF CERTIFICATE ISSUED BY ITO FOR DEDUCTION OF TAX AT LOWER RATE ON THE PAYMENTS BEING MADE TO THE SAID PARTY, COPY OF BANK ACCOUNT EVIDENCING PAYMENTS TO THE SAID PARTY ETC. IN SUPPORT OF THE GENUINENESS OF THE EXPENDITURE. WHEN THE RELEVANT DOCUMENT S A RE P RODUCED , MERELY PHYSICAL NON PRODUCTION OF CREDITOR CANNOT BE BASIS FOR THE ADDITION. L EANED C IT ( A ) HAS TAKEN RIGHT DECISION WHICH MAY BE UPHELD . 5. I HAVE HEA R D THE RIVAL CONTENTIONS AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. I FIND MERIT IN TH E CONTENTION OF THE LD . C OUNSEL FOR THE ASSESSEE. T HER E IS NO INFIRMITY IN THE ORDER OF THE LEARNED CIT(A) WHICH IS UPH ELD. 6. IN THE RESULT, REVENUE S APPEAL IS DISMISSED. ( THIS ORDER P RONOUNCED IN THE OPE N COURT TODAY ON TH E 15 TH DAY OF JULY , 201 6 . ) SD/ - R.P. TOLANI ( JUDICIAL MEMBER) AHMEDABAD, THE 15 TH DAY OF JULY , 2016 ITA NO. 1586 /AHD/201 2 A.Y . 20 0 4 - 05 PAGE 3 OF 3 PBN/* COPIES TO: (1) THE APPELLANT ( 2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD