M/S. Tirat C.S. Shop, Asansol V. ITO, Ward-1(3), Asansol, Asansol

ITA 162/KOL/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 4594 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 5 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-07-2016
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 09-02-2015
• Court: TRIBUNAL
• Department Lawyers: M K BISWAS
• Assessee Lawyers: V N PUROHIT
• Section: 40A(3)

Judgement Text

I.T.A. NOS. 162 & 163/KOL./2015 ASSESSMENT YEARS: 2007-2008 & 2010-2011 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA C(SMC) BENCH, KOLKATA BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER I.T.A. NOS. 162 & 163 /KOL/ 2015 ASSESSMENT YEARS: 2007-2008 & 2010-2011 M/S. TIRAT C.S. SHOP,.............................. ..............................APPELLANT P.O. TIRAT- KALLPPHARI, ASANSOL (BURDWAN), PIN: 713 339 [PAN : AADFT 4483 D] -VS.- INCOME TAX OFFICER,............................... ............................RESPONDENT WARD-1(3), ASANSOL, SAHANA APARTMENT, 186/1, LOWER CHELDANGA, G.T. ROAD, ASANSOL (WEST). PIN: 713 304 APPEARANCES BY: SHRI V.N. PUROHIT, FCA, FOR THE ASSESSEE SHRI M.K. BISWAS, JCIT, D.R., FOR THE DEPARTMENT DATE OF CONCLUDING THE HEARING : JULY 11, 2016 DATE OF PRONOUNCING THE ORDER : JULY 14, 2016 O R D E R THESE TWO APPEALS FILED BY THE ASSESSEE ARE DIRECTE D AGAINST TWO SEPARATE ORDERS PASSED BY THE LD. COMMISSIONER OF I NCOME TAX (APPEALS), ASANSOL BOTH DATED 01.12.2014 FOR THE ASSESSMENT YE ARS 2007-08 AND 2010-11 AND SINCE THE SOLITARY ISSUE INVOLVED THERE IN IS COMMON, THE SAME HAVE BEEN HEARD TOGETHER AND ARE BEING DISPOSE D OF BY A SINGLE COMPOSITE ORDER. 2. THE SOLITARY COMMON ISSUE INVOLVED IN THESE APPE ALS RELATES TO THE ADDITION OF RS.7,19,450/- AND RS.28,49,058/- MADE B Y THE ASSESSING OFFICER UNDER SECTION 40A(3) AND CONFIRMED BY THE L D. CIT(APPEALS). I.T.A. NOS. 162 & 163/KOL./2015 ASSESSMENT YEARS: 2007-2008 & 2010-2011 PAGE 2 OF 4 3. THE ASSESSEE IN THE PRESENT CASE IS A PARTNERSHI P FIRM, WHICH IS ENGAGED IN THE BUSINESS OF RETAIL SALE OF COUNTRY S PIRIT AND PACHAI. THE RETURNS OF INCOME FOR BOTH THE YEARS UNDER CONSIDER ATION WERE FILED BY THE ASSESESE ON 06.03.2008 AND 30.03.2011 DECLARING TOTAL INCOME OF RS.7,317/- AND RS.14,084/- FOR A.Y. 2007-08 AND 201 0-11 RESPECTIVELY. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, IT WAS NOTICED BY THE ASSESSING OFFICER THAT THE ASSESSEE HAS MADE PAYMEN TS AGAINST PURCHASES OF COUNTRY SPIRIT IN CASH IN THE SUM EXCEEDING RS.2 0,000/- AGGREGATING TO RS.35,97,252/- AND RS.28,49,058/- IN A.Y. 2007-08 A ND 2010-11 RESPECTIVELY. SINCE THE SAID PAYMENTS WERE MADE BY THE ASSESSEE IN VIOLATION OF THE PROVISIONS OF SECTION 40A(3) AND T HERE WAS NO CASE MADE OUT BY THE ASSESSEE TO SHOW THAT THE SAID PAYMENTS IN CASH WERE MADE IN THE EXCEPTIONAL CIRCUMSTANCES AS PRESCRIBED IN RULE 6DD, THE ASSESSING OFFICER INVOKED THE PROVISIONS OF SECTION 40A(3) AN D MADE A DISALLOWANCE OF RS.7,19,450/- BEING 20% OF THE TOTAL CASH PAYMEN TS OF RS.35,97,252/- AND RS.28,49,058/- FOR A.Y. 2007-08 AND 2010-11 RES PECTIVELY. 4. THE DISALLOWANCE MADE BY THE ASSESSING OFFICER U NDER SECTION 40A(3) IN BOTH THE YEARS UNDER CONSIDERATION WAS CH ALLENGED BY THE ASSESSEE IN THE APPEALS FILED BEFORE THE LD. CIT(AP PEALS) AND KEEPING IN VIEW THAT THE CASE OF THE ASSESSEE WAS NOT COVERED BY THE EXCEPTIONAL CIRCUMSTANCES PRESCRIBED IN RULE 6DD, THE LD. CIT(A PPEALS) CONFIRMED THE DISALLOWANCE MADE BY THE ASSESSING OFFICER UNDER SE CTION 40A(3) FOR BOTH THE YEARS UNDER CONSIDERATION. AGGRIEVED BY THE ORD ERS OF THE LD. CIT(APPEALS), THE ASSESSEE HAS PREFERRED THESE APPE ALS BEFORE THE TRIBUNAL. 5. I HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AND ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. AS POINTED O UT BY THE LD. COUNSEL FOR THE ASSESSEE FROM THE RELEVANT PORTION OF THE A SSESSMENT ORDER, IT WAS SPECIFICALLY SUBMITTED BY THE ASSESSEE BEFORE THE A SSESSING OFFICER THAT I.T.A. NOS. 162 & 163/KOL./2015 ASSESSMENT YEARS: 2007-2008 & 2010-2011 PAGE 3 OF 4 THE AMOUNTS IN QUESTION WERE NOT PAID IN CASH DIREC TLY TO THE CONCERNED PARTY AGAINST THE PURCHASES, BUT THE SAME WERE DEPO SITED IN THE BANK ACCOUNT OF THE SAID PARTY. IN THIS REGARD, HE HAS R ELIED ON THE DECISION OF THE HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS.- SMT. SHELLY PASSI REPORTED IN 350 ITR 227, WHEREIN IT WA S HELD THAT THE AMOUNT IN CASH HAVING BEEN DEPOSITED BY THE ASSESSEE DIREC TLY IN THE BANK ACCOUNT OF THE SELLER, THE SAME COULD NOT BE DISALL OWED UNDER SECTION 40A(3). THE LD. D.R. HAS NOT DISPUTED THIS PROPOSIT ION BY CITING DECISION OF ANY OTHER HONBLE HIGH COURT OR HONBLE SUPREME COURT TAKING A CONTRARY VIEW. HE, HOWEVER, HAS CONTENDED THAT THE SUBMISSION MADE BY THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEE DINGS OF HAVING DEPOSITED DIRECTLY, THE AMOUNT IN QUESTION IN THE B ANK ACCOUNT OF THE CONCERNED SUPPLIER WAS NOT VERIFIED BY THE ASSESSIN G OFFICER AND SINCE NO FINDING THEREON HAS BEEN GIVEN EITHER BY THE ASSESS ING OFFICER OR BY THE LD. CIT(APPEALS), THE MATTER MAY BE RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR SUCH VERIFICATION. I FIND MERIT IN THE CONTENTION OF THE LD. D.R. AND SINCE THE LD. COUNSEL FOR THE ASSESSEE HAS NOT ALSO RAISED ANY OBJECTION IN THIS REGARD, I SET ASIDE THE IMPUGNED ORDERS OF THE LD. CIT(APPEALS) ON THE ISSUE UNDER CONSIDERATION AND R ESTORE THE MATTER TO THE FILE OF THE ASSESSING OFFICER FOR DECIDING THE SAME AFRESH IN THE LIGHT OF THE DECISION OF THE HONBLE PUNJAB & HARYANA HIG H COURT IN THE CASE OF SMT. SHELLY PASSI (SUPRA) AFTER VERIFYING THE CLAIM OF THE ASSESSEE OF HAVING DEPOSITED THE AMOUNTS IN QUESTION IN CASH DI RECTLY IN THE BANK ACCOUNT OF THE CONCERNED SUPPLIER/SELLER. 6. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON JULY 14, 2016 . SD/- (P.M. JAGTAP) ACCOUNTANT MEMBER KOLKATA, THE 14 TH DAY OF JULY, 2016 I.T.A. NOS. 162 & 163/KOL./2015 ASSESSMENT YEARS: 2007-2008 & 2010-2011 PAGE 4 OF 4 COPIES TO : (1) M/S. TIRAT C.S. SHOP, C/O. V.N. PUROHIT & CO., CHARTERED ACCOUNANTS, DIAMOND CHAMBERS, UNIT-III, 4 TH FLOOR, SUIT NO. 4G, 4, CHOWRINGHEE LANE, KOLKATA-700 016 (2) INCOME TAX OFFICER, WARD-1(3), ASANSOL, SAHANA APARTMENT, 186/1, LOWER CHELDANGA, G.T. ROAD, ASANSOL (WEST). PIN: 713 304 (3) COMMISSIONER OF INCOME TAX (APPEALS), ASANSOL (4) COMMISSIONER OF INCOME TAX- , (5) THE DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.