M/s. Vindhya Bio-tech Pvt.Ltd, Hyderabad V. ITO (OSD)-2, Hyderabad

ITA 1645/HYD/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 3292 (ITAT-HYDERABAD)
• Duration Of Justice: 5 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-06-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 21-12-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B V PRASAD REDDY
• Section: 234B; 68; 69; 6

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD B BENCH, HYDERABAD BEFORE SHRI G.C. GUPTA, VICE PRESIDENT AND SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER ITA NO.1642/H/2010 ASSESSMENT YEAR : 2007-08 M/S MEDRAVATI AGRO FARMS (P) LTD. HYDERABAD (PAN AACCM 4811A) VS ITO (OSD)2, CENTRAL RANGE-I, HYDERABAD APPELLANT RESPONDENT ITA NO.1643/H/2010 ASSESSMENT YEAR : 2007-08 M/S KONAR GREENLANDS( P) LTD., HYDERABAD (PAN AABCK 5814 A) VS ITO (OSD)2, CENTRAL RANGE-I, HYDERABAD APPELLANT RESPONDENT ITA NO.1645/H/2010 ASSESSMENT YEAR 2007-08 M/S VINDHYA BIO TECH P LTD., HYDERABAD (PAN AABCV 6775 F) VS ITO (OSD)2, CENTRAL RANGE-I, HYDERABAD APPELLANT RESPONDENT APPELLANT BY : SHRI K.C. DEVDAS RESPONDENT BY : SHRI B.V. PRASAD REDDY ORDER PER BENCH THESE THREE APPEALS PREFERRED BY THE ABOVE DIFFERENT ASSESSEES ARE DIRECTED AGAINST ORDERS PAS SED BY ITA NOS.1642, ITA NOS.1642, ITA NOS.1642, ITA NOS.1642, 1643 & 1645/H/2010 1643 & 1645/H/2010 1643 & 1645/H/2010 1643 & 1645/H/2010 M/S M M/S M M/S M M/S MEDRAVATI, VIDHYA & KONAR, GREENLANDS P LTD., H YDERABAD EDRAVATI, VIDHYA & KONAR, GREENLANDS P LTD., HYDERA BAD EDRAVATI, VIDHYA & KONAR, GREENLANDS P LTD., HYDERA BAD EDRAVATI, VIDHYA & KONAR, GREENLANDS P LTD., HYDERA BAD 2 THE CIT(A)VII, HYDERABAD DATED 8.10.2010 AND PERTA INS TO THE ASSESSMENT YEAR 2007-08. SINCE ISSUES INVOL VED IN THESE APPEALS ARE COMMON IN NATURE, THEY ARE CLUBBE D TOGETHER, HEARD TOGETHER AND DISPOSED OFF VIDE THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. IN THESE APPEALS, THE ASSESSEES HAVE RAISED GROUNDS WITH REGARD TO SUSTAINING OF THE ADDITION B Y THE CIT(A) AND ALSO LEVY OF INTEREST U/S 234A & 234B OF THE INCOME TAX ACT, 1961. 3. WITH REGARD TO ITA NO.1642/H/2010, THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE HAS SUBMITTED THAT THE ADDITIONS WERE MADE U/S 69 OF TH E ACT THOUGH THE INVESTMENTS RECORDED IN THE REGULAR BOOK S OF ACCOUNTS. ACCORDING TO AR, PROVISIONS OF SECTION 6 9 IS NOT APPLICABLE WITH REGARD TO INVESTMENTS FOUND ENTERED IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE. 4. WITH REGARD TO ITA NO.1643/H/2010, THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE HAS SUBMITTED THAT THE ADDITIONS MADE U/S 68 IN RESPECT OF BANK CREDIT IS AGAINST THE PROVISIONS OF SECTION 68 OF THE ACT, AS BANK STATEMENTS ARE NOT THE BOOKS OF ACCOUN TS OF THE ASSESSEE AND THE ENTRIES FOUND IN THE BANK STAT EMENT CANNOT BE CONSIDERED FOR ADDITION U/S 68 OF THE ACT . REGARDING THE ADDITION TOWARDS INVESTMENT IN LAND, THE LEARNED AUTHORIZED REPRESENTATIVE HAS SUBMITTED THA T THE INVESTMENT IN LAND ENTERED IN THE BOOKS OF ACCOUNTS , AS SUCH THIS CANNOT BE CONSIDERED FOR ADDITION U/S 69 OF THE ACT. REGARDING ADDITION TOWARDS CURRENT LIABILITIE S, THE AR ITA NOS.1642, ITA NOS.1642, ITA NOS.1642, ITA NOS.1642, 1643 & 1645/H/2010 1643 & 1645/H/2010 1643 & 1645/H/2010 1643 & 1645/H/2010 M/S M M/S M M/S M M/S MEDRAVATI, VIDHYA & KONAR, GREENLANDS P LTD., H YDERABAD EDRAVATI, VIDHYA & KONAR, GREENLANDS P LTD., HYDERA BAD EDRAVATI, VIDHYA & KONAR, GREENLANDS P LTD., HYDERA BAD EDRAVATI, VIDHYA & KONAR, GREENLANDS P LTD., HYDERA BAD 3 SUBMITTED THAT PROPER OPPORTUNITY OF HEARING WAS NO T GIVEN TO THE ASSESSEE TO PUT FORTH ITS CASE. 5. REGARDING ITA NO.1645/H/2010, THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE HAS SUBM ITTED THAT AN OPPORTUNITY MAY BE GIVEN TO THE ASSESSEE TO FURNISH CONFIRMATION LETTERS FROM THE RESPECTIVE PA RTIES PROVING THE GENUINENESS OF THE CREDITORS. 6. THE LEARNED DEPARTMENTAL REPRESENTATIVE RELIED ON THE ORDER OF THE CIT(A). 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IN OUR OPINION, AS SEEN FROM THE ORDERS OF THE LOWER AUTHORITIES, EFFECTIVE OPPORTUNITY OF HEARING HAS NOT BEEN GIVEN TO THE ASSESSEES. FURTHER, THE INVESTMENTS FOUND ENTERED IN THE BOOKS OF ACCOUNTS CANNOT BE CONSIDERED FOR ADDITION U/S 69 OF THE IT ACT. AT THE BEST, IF THE SOURCE IS NO T EXPLAINED, IT MAY BE CONSIDERED U/S 68 OF THE ACT. HOWEVER, IN THESE CASES, EFFECTIVE OPPORTUNITY HAS NOT BEEN GIVEN TO THE ASSESSEE AND ON THIS REASON, WE F EEL IT APPROPRIATE TO SET ASIDE ALL THE ISSUES RAISED BY T HE ASSESSEES TO THE FILE OF ASSESSING OFFICER FOR FRES H CONSIDERATION. FURTHER, LEVY OF INTEREST U/S 234A & 234B IS CONSEQUENTIAL AND MANDATORY IN NATURE AND DO NOT REQUIRE ADJUDICATION AT THIS STAGE. ACCORDINGLY, W E REMIT BACK THE ENTIRE ISSUE IN ALL THE CASES TO THE FILE OF ASSESSING OFFICER WITH A DIRECTION TO GIVE ADEQUATE OPPORTUNITY OF HEARING AND DECIDE THE ISSUE THEREUP ON. ITA NOS.1642, ITA NOS.1642, ITA NOS.1642, ITA NOS.1642, 1643 & 1645/H/2010 1643 & 1645/H/2010 1643 & 1645/H/2010 1643 & 1645/H/2010 M/S M M/S M M/S M M/S MEDRAVATI, VIDHYA & KONAR, GREENLANDS P LTD., H YDERABAD EDRAVATI, VIDHYA & KONAR, GREENLANDS P LTD., HYDERA BAD EDRAVATI, VIDHYA & KONAR, GREENLANDS P LTD., HYDERA BAD EDRAVATI, VIDHYA & KONAR, GREENLANDS P LTD., HYDERA BAD 4 8. IN THE RESULT, ALL THE THREE APPEALS OF THE ASSESSEES ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 1.6.2011 SD/- G.C. GUPTA SD/- CHANDRA POOJARI VICE PRESIDENT ACCOUNTANT MEMBER DATED 1 ST JUNE, 2011 COPY FORWARDED TO: 1. M/S MEDRAVATI AGRO FARMS P LTD., H NO.8-3- 222/B/7/35,36, D.92 & 93, FLAT NO.304, SRIRAMANA ENCLAVE, MADHURA NAGAR, SR NAGAR POST, HYDERABAD. 2. M/S KONAR GREENLANDS P LTD., H.NO.2-13/31, SS NAGAR, OPP. HYDERNAGAR, HYDERABAD. M/S VINDHYA BIO TECH P LTD., H.NO.1-11-192, FLAT NO.201, KAMALA ARCADE, SHAMLAL BUILDING, BEGUMPET, HYDERABAD. C/O B.V. PRASAD, CA, G-26, RBVR REDDY, HOSTEL COMPLEX, TILAK ROAD, HYDERABAD. 3. ITO, (OSD)2, CENTRAL RANGE-1, HYDERABAD 4. CIT(A) VII, HYDERABAD 5. CIT, HYDERABAD 6. THE DR, ITAT, HYDERABAD. NP/