M/s. Jaspal Filling Station, Distt. Nawanshehar V. The Income Tax Officer, Nawanshahr

ITA 163/ASR/2013

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 8694 (ITAT-AMRITSAR)
• Duration Of Justice: 2 year(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-03-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 04-03-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 14-03-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Additional evidence
• Section: 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. A.D.JAIN, JUDICIAL MEMBER AND SH. B.P.JAIN, ACCOUNTANT MEMBER I.T.A. NO.163(ASR)/2013 ASSESSMENT YEAR:2006-07 PAN :AAFFJ 5357 M/S. JASPAL FILLING STATION, VS. INCOME TAX OFFICE R, VILL. PALLI JHIKKI, NAWANSHAHAR. NAWANSHAHAR. (APPELLANT) (RESPONDENT) APPELLANT BY:SH.ANIL MIGLANI, ADVOCATE RESPONDENT BY:SH.TARSEM LAL, DR DATE OF HEARING:04/03/2015 DATE OF PRONOUNCEMENT:23/03/2015 ORDER PER B.P.JAIN,AM: THIS APPEAL OF THE ASSESSEE ARISES FROM THE ORDER OF THE CIT(A), JALANDHAR, DATED 01.01.2013 FOR THE ASSESSMENT YEA R 2006-07. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : 1. THAT THE ORDER OF THE CIT(A) IS AGAINST LAW & F ACTS OF THE CASE ON THE FILE. 2. THAT THE LD. CIT(A) GRAVELY ERRED IN SUSTAINING ADDITION OF RS.4,99,862/- BEING PART OF CAPITAL LYING IN THE OP ENING BALANCE OF ONE OF THE PARTNER SMT. GURBACHAN KAUR WHO WAS A PROPRIETOR UPTO THE PERIOD 31.07.2005 TO 31.03.2006 . ITA NO.163(ASR)/2013 2 2.2. THAT WHILE SUSTAINING THE AFORESAID ADDITION T HE LD. CIT(A) IGNORED THAT THE ASSESSEE FIRM WAS CONSTITUTED ON 0 1.08.2005 AND THE OPENING CAPITAL OF RS.11,11,643/- WAS INVES TED BY SMT. GURBACHAN KAUR, PARTNER WHICH WAS THE CLOSING BALA NCE OF HER CAPITAL IN HER BOOKS OF ACCOUNT AS PER BALANCE SHEE T OF HER PROPRIETORSHIP CONCERN AS AT 31.07.2005, WHEREAS TH E CIT(A) ERRED IN SUSTAINING ADDITION OF RS.4,99,862/- BY AL LOWING PART RELIEF ONLY IN RESPECT OF THE CLOSING CAPITAL BALAN CE OF CAPITAL OF SMT. GURBACHAN KAUR AS ON 31.03.2005 AT RS.6,11,781 /-. 2.3. THAT WHILE SUSTAINING THE AFORESAID ADDITION T HE LD. CIT(A) IGNORED THE DOCUMENTARY EVIDENCE IN THE SHAPE OF TR ADING, PROFIT & LOSS AND BALANCE SHEET ALONGWITH CAPITAL A CCOUNT OF THE PROPRIETOR SMT. GURBACHAN KAUR IN THE PROPRIETO RSHIP FIRM FOR THE PERIOD 01.04.2005 TO 31.07.2005, FILED BEFO RE HIM AS WELL AS FILED BEFORE THE AO DURING ASSESSMENT PROCE EDINGS, WHICH WERE DULY SUPPORTED BY THE AO DURING ASSESSME NT PROCEEDINGS, WHICH WERE DULY SUPPORTED BY THE BOOKS OF ACCOUNT AND WERE NOT REQUIRED TO BE AUDITED UNDER T HE INCOME TAX LAW NOR IT WAS MANDATORY FOR SMT. GURBACHAN KAU R TO FILE HER RETURN OF INCOME U/S 139 OF THE INCOME TAX ACT, 1961 FOR THE PERIOD 01.04.2005 TO 31.07.2005 BEING LOSS. 4. THAT THE APPELLANT BEGS TO ADD OR AMEND ANY GROU ND OF APPEAL BEFORE THE APPEAL IS HEARD AND DISPOSED OFF. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE RETURN OF INCOME WAS FILED ON 31.10.2006 DECLARING A LOSS OF RS. (-) 99,710/- FOR THE PERIOD 01.08.2005 TO 31.03.2006 (THOUGH IN THE ASSESSMENT ORDER THE PERI OD IS WRONGLY MENTIONED AS 01.04.05 TO 31.03.05). DURING THE ASSESSMENT IT WAS FOUND THAT IN RESPECT OF ONE PARTNER SMT. GURBACHAN KAUR THE CAPITAL SHOW N AS ON 01.08.2005 WAS NIL AND THERE WAS AN ADDITION OF RS. 11,11,643/-. S HE WAS PREVIOUSLY THE PROPRIETOR OF M/S JASPAL FILLING, STATION WHICH WAS CONVERTED INTO A FIRM ITA NO.163(ASR)/2013 3 W.E.F., 01.08.2005. A LETTER WAS SENT BY AO TO SMT. GURBACHAN KAUR ASKING HER WHETHER ANY RETURN WAS FILED BY HER FOR THE PER IOD 01.04.2004 TO 31.03.2005 AND ALSO FOR THE PERIOD 01.04.2005 TO 31 .07.2005. THE LETTER WAS UNDELIVERED. THE ASSESSEE WAS ALSO ASKED TO PRODUCE SMT. GURBACHAN KAUR BUT SHE COULD NOT BE PRODUCED, HOWEVER A PHOTOCOPY OF TRADING AND PROFIT AND LOSS ACCOUNT AND BALANCE SHEET RELATING TO M/S JASPAL FILLING STATION WAS FILED. ANOTHER DOCUMENT DEPICTING THE CAPITAL AS ON 01.08.2005 AT RS.11,11,643/- WAS FILED. SINCE NO EVIDENCE OF FILI NG ANY RETURN FOR THE PERIOD PRIOR TO 01.08.2005 WAS FILED, THE AO ADDED THE OPENING CAPITAL OF RS.11,11,643 IN THE NAME OF SMT. GURBACHAN KAUR TO THE INCOME OF THE FIRM. 3. BEFORE THE LD. CIT(A), THE ASSESSEE MADE SUBMISS IONS AND PRODUCED THE ADDITIONAL EVIDENCES WHICH WERE SENT TO THE AO FOR REMAND REPORT AND REPORT OF THE AO WAS SUBMITTED TO THE ASSESSEE AND THE REJOINDER WAS TAKEN FROM THE ASSESSEE. THE LD. CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, REPORT OF THE AO AND THE REJOINDER OF THE ASSESSEE, DELETED THE ADDITION OF RS.6,11,781/- AND SUSTAINED THE ADDITIO N OF RS.4,99,862/- VIDE PARA 14 OF HIS ORDER. 4. THE LD. COUNSEL FOR THE ASSESSEE, RELIED ON VARI OUS SUBMISSIONS MADE BEFORE THE LD. CIT(A) AND PAPER BOOK CONTAINING PAG ES 1 T O 23. ITA NO.163(ASR)/2013 4 5. THE LD. COUNSEL FOR THE ASSESSEE, MR. ANIL MIGLA NI, ADVOCATE TRIED TO CONVINCE THE BENCH THAT THE MONEY HAS BEEN DEPOSITE D AFTER 2005 I.E. 01.04.2005 TO 31.07.2005 AFTER VARIOUS REALIZATION, WHICH WERE POINTED OUT IN THE PAPER BOOK AT PAGES 1 TO 23 AND ARGUED THAT THE ADDITION WAS WRONGLY SUSTAINED BY THE LD. CIT(A) AND THE SAME MAY DIRECT ED TO BE DELETED. 6. THE LD. DR, ON THE OTHER HAND, RELIED UPON THE O RDERS OF BOTH THE AUTHORITIES BELOW AND ARGUED THAT THERE IS NO EVIDE NCE OF THE SOURCES OF CAPITAL INTRODUCED FROM 01.04.2005 TO 31.07.2005 AN D THE ASSESSEE HAS ALSO NOT FILED INCOME TAX RETURN FOR THE YEAR ENDING 31 ST MARCH, 2006 RELEVANT TO ASSESSMENT YEAR 2006-07 AND NO OTHER EVIDENCE IN SU PPORT OF THE CLAIM HAS BEEN PLACED ON RECORD. THE ARGUMENT THAT REALIZATIO NS HAVE BEEN MADE ARE WITHOUT ANY DOCUMENTARY SUPPORT AND THEREFORE, CANN OT BE ACCEPTED. THEREFORE, THE LD. DR PRAYED TO CONFIRM THE ORDER O F THE LD. CIT(A). 7. WE HAVE HEARD THE RIVAL CONTENTIONS AND HAVE PER USED THE MATERIAL AVAILABLE ON RECORD. THE ONLY DISPUTE IS WITH REGA RD TO THE AMOUNT OF RS.4,99,862/-, WHICH REMAINED UNEXPLAINED BEFORE TH E LD. CIT(A) SINCE THE ASSESSEE HAS NOT FILED THE RETURN OF INCOME FOR THE YEAR ENDING 31.03.2006 RELEVANT TO ASSESSMENT YEAR 2006-07 AND THE ASSESSE E HAS NOT BROUGHT ANY MATERIAL ON RECORD ON ACCOUNT OF REALIZATION MADE OUT OF BALANCES OUTSTANDING AS ON 31.03.2005. IN THE FACTS AND CIRC UMSTANCES OF THE CASE, WE ITA NO.163(ASR)/2013 5 FIND NO INFIRMITY IN THE ORDER OF THE LD. CIT(A), W HO HAS RIGHTLY CONFIRMED THE ACTION OF THE AO. THE ORDER OF THE LD. CIT(A) FOR THE SAKE OF CONVENIENCE IS REPRODUCED HEREINEBLOW: GROUND NO.2 AND 3 RELATES TO THE ADDITION OF RS.11 ,11,643/-. THE UNDISPUTED FACTS AS EMERGE ARE THAT PRIOR TO 01 .08.2005 SMT. GURCHARAN KAUR WAS THE PROPRIETOR OF M/S JASPA L FILLING STATION. THE COPY OF RETURN FOR THE PERIOD 01.04.04 TO 31.03.05 IS ON RECORDS ALONGWITH THE COMPUTATION OF INCOME C ERTIFIED COPIES OF BALANCE SHEET AND PROFITS AND LOSS ACCOUN T ARE ALSO ON FILE. AS PER BALANCE SHEET AS ON 31.03.05 (THE RELE VANT RETURN IS FILED AND EVIDENCE ON RECORDS.) THE CAPITAL OF SMT. GURBACHAN KAUR WAS AT RS.611781.92. SO FAR AS THIS BALANCE AS ON 31.03.05 IN CONCERNED, IS WELL EVIDENCED AND IS ACC EPTED. AS FAR AS THE PERIOD 01.04.05 TO 31.07.2005 IS CONCERNED N O RETURN OF INCOME IS FILED AS THERE ARE NEITHER ANY EVIDENCE B ROUGHT ON RECORDS NOR ANY NARRATION IS AVAILABLE TO SUBSTANTI ATE AS TO HOW THE CAPITAL OF RS.6,11,781 AS ON 01.04.05 SWELLED T O RS.11,11,643/- AS ON 01.08.05. THROUGH THE COPIES O F BALANCE SHEET AND PROFIT AND LOSS ARE FILED YET THEY ARE NE ITHER AUDITED NOR SUPPORTED BY A RETURN OF INCOME FILED FOR THE P ERIOD 01.04.05 TO 31.07.05. DESPITE SHOWING A NET LOSS OF RS.2,69,811/- FOR THIS SHORT PERIOD, THERE IS NOTHI NG TO SUPPORT THE CAPITAL AS ON 31.07.05 SHOWN AT 11,11,643/-. IN VIEW OF THIS THE DIFFERENCE BETWEEN RS.11,11,643/- AND RS.6,11,7 81/- (CAPITAL AS ON 31.03.05 WHICH IS ACCEPTED AS BEING DULY SUBSTANTIATED) I.E., RS.4,99,862/- IS CLEARLY NOT E XPLAINED AS YET AND THE ADDITION TO THIS EXTENT IS CONFIRMED. 7.1. IN VIEW OF OUR FINDINGS HEREINABOVE AND WELL R EASONED ORDER OF THE LD. CIT(A), WE FIND NO INFIRMITY IN THE ORDER OF THE LD . CIT(A) AND UPHOLD THE SAME. ACCORDINGLY, ALL THE GROUNDS OF THE ASSESSEE ARE DISMISSED. ITA NO.163(ASR)/2013 6 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IN ITA NO.163(ASR)/2014 IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 23RD MARCH, 2015. SD/- SD/- (A.D.JAIN) (B.P. JAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 23RD MARCH, 2015 /SKR/ COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE:M/S. JASPAL FILLING STATION, VILL. PAL LI JHIKKI, NAWANSHHAR 2. THE ITO, NAWANSHAHAR 3. THE CIT(A), JLR 4. THE CIT, JLR. 5. THE SR DR, ITAT, AMRITSAR. TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR.