Bhojohori Manna Restaurants India Pvt. Ltd., , Kolkata V. DCIT, Circle - 8(1), Kolkata , Kolkata

ITA 1715/KOL/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 9963 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 4 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-01-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2015-2016
• Appeal Filed On: 10-08-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SUPRIYO PAL
• Assessee Lawyers: MANOJ DUTTA
• Keywords: Principle of natural justice
• Section: 69C; 133(6)

Judgement Text

1 ITA NO.1715/KOL/2018 BHOJORI MANNA RESTAURANTS IN DIA P. LTD., AY 2015-16 , C , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: KOL KATA ( ) . . , . ' # $% % , '( ) [BEFORE SHRI A. T. VARKEY, JM & DR. A. L. SAINI, A M] I.T.A. NO. 1715/KOL/2018 ASSESSMENT YEAR: 2015-16 BHOJORI MANNA RESTAURANTS INDIA PVT. LTD. (PAN: AAECB0690C) VS DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-8(1), KOLKATA APPELLANT RESPONDENT DATE OF HEARING 16.12.2019 DATE OF PRONOUNCEMENT 03.01.2020 FOR THE APPELLANT SHRI MANOJ DUTTA, FCA FOR THE RESPONDENT SHRI SUPRIYO PAL, JCIT, SR. DR ORDER PER SHRI A.T.VARKEY, JM THIS APPEAL PREFERRED BY THE ASSESSEE IS AGAINST TH E ORDER OF THE LD. CIT(A)-23, KOLKATA DATED 11.06.2018 FOR AY 2015-16. 2. THE SOLE ISSUE INVOLVED IN THIS APPEAL OF ASSESS EE IS AGAINST THE ACTION OF LD. CIT(A) IN CONFIRMING THE ADDITION OF PURCHASE AS UNEXPLAIN ED EXPENDITURE U/S. 69C OF THE INCOME- TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT ). 3. BRIEFLY STATED FACTS AS OBSERVED BY THE AO ARE T HAT DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS ASKED TO FURNISH THE DETAILS OF PURCHASES ALONG WITH COPIES OF PURCHASE LEDGER. THE ASSESSEE FURNISHED REPLY VIDE LETTER DATED 25.09.2017. NOTICES U/S. 133(6) OF THE ACT WERE ISSUED ON TEST CHECK BASIS T O VERIFY THE VERACITY OF THE EXPENSE/PURCHASES AS CLAIMED BY THE ASSESSEE. ON EXAMINATION OF THE REPLIES RECEIVED AND MATERIAL ON RECORDS, THE AO FOUND THAT THE PURCHASE AMOUNT WAS OVERSTATED BY AN AMOUNT OF RS.16,96,686/-. ACCORDING TO AO, THE ASSESSEE WAS NOT ABLE TO RECONCILE THE DIFFERENCE IN PURCHASE AMOUNT. THEREAFTER, THE ASSESSEE WAS SHOW CAUSED AS TO WHY THE DIFFERENTIAL AMOUNT OF RS.16,96,686/- SHOULD NOT BE DISALLOWED. THE ASSESSEE FURNISHED REPLY VIDE LETTER DATED 07.12.2017 AND ACCEPTED THE PROPOSED DISALLOW ANCE OF RS.16,96,686/-. ACCORDINGLY, 2 ITA NO.1715/KOL/2018 BHOJORI MANNA RESTAURANTS IN DIA P. LTD., AY 2015-16 THE AO DISALLOWED THE PURCHASE EXPENSES AMOUNTING T O RS.16,96,686/- AND ADDED BACK THE SAME TO THE TOTAL INCOME OF THE ASSESSEE. AGGRIEVE D, ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A), WHO CONFIRMED THE ACTION OF AO. AGGRIE VED, THE ASSESSEE IS BEFORE US. 4. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE. WE NOTE THAT THE AO IN ORDER TO VERIFY THE V ERACITY OF THE SUNDRY CREDITORS ISSUED NOTICES U/S. 133(6) OF THE ACT AND AFTER RECEIVING THEIR REPLIES HAS FOUND THE DIFFERENCE WHICH HAS BEEN ADDED TO THE TOTAL INCOME OF THE ASS ESSEE. WE NOTE THAT WHEN THE ASSESSEE WAS CONFRONTED BY THE AO ABOUT THE FACT THAT THERE WERE CERTAIN DISCREPANCIES/DIFFERENCES IN THE AMOUNT AS SHOWN BY THE ASSESSEE AS WELL AS THAT OF THE SUNDRY CREDITORS, THE ASSESSEE IN TURN HAD REQUESTED FOR THE COPY OF THE REPLIES OF T HE SUNDRY CREDITORS. HOWEVER, THE AO WITHOUT FURNISHING ANY COPY OF THE REPLIES OF THE S UNDRY CREDITORS, THE AO HAS MADE THE ADDITION WHICH IS IN VIOLATION OF THE NATURAL JUSTI CE. IN THIS CASE, THE ONLY ADVERSE MATERIAL IN THE HAND OF THE AO TO MAKE THE ADDITION AGAINST THE ASSESSEE WAS THE REPLIES HE RECEIVED FROM THE SUNDRY CREDITORS PURSUANT TO THE NOTICE IS SUED U/S. 133(6) OF THE ACT. SO, WHEN THE ASSESSEE REQUESTED FOR A COPY OF THE ADVERSE MATERI AL/REPLY OF SUNDRY CREDITORS, THE AO OUGHT TO HAVE FURNISHED A COPY OF THE SAME. THE AO CANNOT KEEP THE ASSESSEE IN THE DARK AND USE THE MATERIAL HE COLLECTED AGAINST THE ASSES SEE, SO THE ORDER OF AO IS VITIATED FOR NON- ADHERENCE OF NATURAL JUSTICE. THEREFORE, WE SET ASI DE THE ORDER OF THE LD. CIT(A) AND REMAND THE MATTER BACK TO THE FILE OF THE AO TO DEC IDE THE ISSUE DE NOVO. WE ALSO DIRECT THE AO TO FURNISH COPIES OF THE REPLIES OF THE SUNDRY C REDITORS WHICH WAS RECEIVED BY AO PURSUANT TO SEC. 133(6) NOTICES SO THAT THE ASSESS EE WOULD BE ABLE TO DEFEND/EXPLAIN ITS STAND IN ACCORDANCE TO LAW. THEREFORE, ON THIS LIM ITED ISSUE, THE AO IS DIRECTED TO FRAME FRESH ASSESSMENT AS PER LAW AFTER HEARING THE ASSES SEE. 5. IN THE RESULT, THE APPEAL OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER IS PRONOUNCED IN THE OPEN COURT ON 3 RD JANUARY, 2020. SD/- SD/- (DR. A. L. SAINI) (ABY. T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED :3 RD JANUARY, 2020 JD.(SR.P.S.) 3 ITA NO.1715/KOL/2018 BHOJORI MANNA RESTAURANTS IN DIA P. LTD., AY 2015-16 COPY OF THE ORDER FORWARDED TO: 1. APPELLANT M/S. BHOJORI MANNA RESTAURANTS INDIA PVT. LTD.P-33, PHASE- 1, KASBA INDUSTRIAL ESTATE, KASBA, KOLKATA-700107. 2 RESPONDENT DCIT, CIRCLE-8(1), KOLKATA. 3. 4. 5. CIT(A)-23, KOLKATA. (SENT THROUGH E-MAIL) CIT , KOLKATA DR, ITAT, KOLKATA. (SENT THROUGH E-MAIL) / TRUE COPY, BY ORDER, ASSISTANT REGISTRAR