M/s. Shree Cariiers, Baroda V. The Dy.CIT, Circle-2(2), Baroda

ITA 1629/AHD/2014

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 5112 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 2 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-08-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 08-06-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 23-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: M K PATEL
• Section: 143(3)

Judgement Text

, SMC IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & SHRI MAHAVIR PRASAD, JUDICIAL MEMBER ./ I.T.A. NO. 1629/AHD/2014 ( ASSESSMENT YEAR : 2009-10) M/S. SHREE CARRIERS, PROP. SANJIV B. SHAH, B- 214, PARADISE COMPLEX, SAYAJIGUNJ, BARODA 390005 / VS. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE - 2(2), BARODA ././ PAN/GIR NO. : AFSPS8376J ( APPELLANT ) .. ( !' / RESPONDENT ) # / APPELLANT BY : SHRI M. K. PATEL, A.R. !' $# / RESPONDENT BY : SHRI S. K. DEV, SR. D.R. % &'($) DATE OF HEARING 05/07/2018 *+, $) / DATE OF PRONOUNCEMENT 02/08/2018 / O R D E R PER PRADIP KUMAR KEDIA - AM: THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTANCE OF THE ASSESSEE AGAINST THE ORDER OF THE CIT(A)-II, BARODA (CIT(A) IN SHORT), DATED 24.01.2014 ARISING IN THE ASSESSMENT ORDER DATED 23.12.2011 PASSED BY THE ASSESSING OFFICER (AO) UND ER S. 143(3) OF THE INCOME TAX ACT, 1961 (THE ACT) CONCERNING AY 20 09-10. 2. IN THE PRESENT APPEAL, THE ASSESSEE HAS IMPUGNE D THE ACTION OF THE CIT(A) IN CONFIRMING ADDITION OF RS.11,31,665/- MADE UNDER S. 41(1) OF THE ACT IN RESPECT OF CERTAIN DIFFERENCE I N BALANCE OF SUNDRY CREDITORS. ITA NO. 1629/AHD/14 [M/S. SHREE CARRIERS VS. DCIT] A.Y. 2009-10 - 2 - 3. WHEN THE MATTER WAS CALLED FOR HEARING, LEARNED AR FOR THE ASSESSEE AT THE OUTSET SUBMITTED THAT CERTAIN DIFFE RENCE AMOUNTING TO RS.11,31,665/- WAS NOTED BY THE AO IN THE CASE OF O NE OF THE CREDITORS OF THE ASSESSEE COMPANY NAMELY M/S. CENTURY PHARMAC EUTICALS PVT. LTD. THE AO HAS INVOKED THE PROVISIONS OF SECTION 41(1) WRONGLY WITHOUT UNDERSTANDING THE FACT IN PERSPECTIVE. THE LEARNED AR REFERRED TO THE RECONCILIATION STATEMENT AS TABULAT ED AT PAGE NO.6 OF THE CIT(A)S ORDER AND SUBMITTED THAT WHILE THE AFORESA ID CREDITOR HAS SHOWN OUTSTANDING RECEIVABLE FROM THE ASSESSEE AT R S.44,72,784/-, THE ASSESSEE HAD SHOWN RS.56,04,449/- IN ITS BOOKS, THE DIFFERENCE WAS ON ACCOUNT OF CERTAIN ENTRIES WHOSE EFFECTS WERE GIVEN BY THE ASSESSEE BY PASSING GENERAL ENTRIES IN ITS BOOKS IN THE SUBSEQU ENT FY 2011-12 WHEN NOTICED. THE LEARNED AR THUS SUBMITTED THAT N O DIFFERENCE ULTIMATELY REMAINS IN THE BOOKS AND THEREFORE THE A DDITION MADE UNDER S.41(1) IS NOT SUSTAINABLE IN LAW AND ON FACTS. 4. THE LEARNED DR PLACED RELIANCE UPON THE ORDER OF CIT(A). 5. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS AND PERUSED THE RESPECTIVE ORDERS OF THE AO AND THE CIT(A) AND MATERIAL PLACED ON RECORD. THE CONTROVERSY IN THE PRESENT CASE REVOLV ES AROUND ADDITION UNDER S.41(1) OF THE ACT IN VIEW OF THE LOWER OUTST ANDING RECEIVABLE AS SHOWN IN THE BOOKS OF DEBTOR VIS--VIS THE BOOKS OF THE ASSESSEE CREDITOR. AS POINTED OUT ON BEHALF OF THE ASSESSEE , THE DISCREPANCY DOES NOT SURVIVE ANY MORE AND SPECIFIC RECONCILED I N FY 2011-12. IF THIS IS SO, THE ADDITION MADE UNDER S.41(1) OF THE ACT IS NOT SUSTAINABLE HAS RIGHTLY POINTED OUT ON BEHALF OF THE ASSESSEE. HOWEVER, THE ABOVE ASSERTIONS MADE ON BEHALF OF THE ASSESSEE TOWARDS R ECONCILIATION REQUIRE FACTUAL VERIFICATION AT END OF THE AO. THE ISSUE IS ACCORDINGLY SET ASIDE TO THE FILE OF THE AO FOR VERIFICATION OF FACTUAL ASPECTS TOWARDS RECONCILIATION IN THE SUBSEQUENT FY AS POIN TED OUT ON BEHALF OF THE ASSESSEE. IT WILL ALSO BE OPEN FOR THE AO T O SEEK A CERTIFICATE ITA NO. 1629/AHD/14 [M/S. SHREE CARRIERS VS. DCIT] A.Y. 2009-10 - 3 - FROM AN ACCOUNTANT AS DEFINED UNDER S.288 OF THE AC T TOWARDS RECONCILIATION OF DIFFERENCES IN THE OUTSTANDING AS CLAIMED ON BEHALF OF THE ASSESSEE. THE AO IS THUS REQUIRED TO DETERM INE THE ISSUE IN ACCORDANCE WITH LAW AS PER OBSERVATION SET OUT ABOV E AFTER GIVING REASONABLE OPPORTUNITY TO THE OTHER SIDE. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. SD/- SD/- (MAHAVIR PRASAD) (PRADIP KUMA R KEDIA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD: DATED 02/08/2018 TRUE COPY S. K. SINHA / COPY OF ORDER FORWARDED TO:- ..' / REVENUE 2.' / ASSESSEE 0. ) % 1) / CONCERNED CIT 4. % 1)- / CIT (A) 4.5'67!8)8& 9 9 / DR, ITAT, AHMEDABAD :.7;<= / GUARD FILE. BY ORDER / 9 / 9 THIS ORDER PRONOUNCED IN OPEN COURT ON 02/08/ 2018