Apurba Kumar Dey, Barddhaman V. I.T.O.,Ward-1(3), Burdwan

ITA 1715/KOL/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 0270 (ITAT-KOLKATA)
• Duration Of Justice: 10 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-06-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 17-03-2020
• Assessment Year: 2012-2013
• Appeal Filed On: 22-07-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: JAYANTA KHANRA
• Section: 143(3); 250

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA SMC BENCH, KOLKATA (BEFORE SRI J. SUDHAKAR REDDY, HONBLE ACCOUNTANT MEMBER) ITA NO. 1715/KOL/2019 ASSESSMENT YEARS: 2012-13 APURBA KUMAR DEY...................................................................APPELLANT C/O. S.N. GHOSH & ASSOCIATES, ADVOCATES SEBEN BROTHERS LODGE P.O. BUROSHIBTALA P.S. CHINSURAH DIST.:- HOOGHLY WEST BENGAL 712 105 [PAN : ACWPD 6113 B] VS. INCOME TAX OFFICER, WARD-1(3), BURDWAN........................RESPONDENT APPEARANCES BY: SHRI SOMNATH GHOSH, ADVOCATE, APPEARED ON BEHALF OF THE ASSESSEE. SHRI JAYANTA KHANRA, JCIT SR. D/R, APPEARING ON BEHALF OF THE REVENUE. DATE OF CONCLUDING THE HEARING : MARCH 17 TH , 2020 DATE OF PRONOUNCING THE ORDER : JUNE 19 TH , 2020 ORDER PER J. SUDHAKAR REDDY, AM :- THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) BURDWAN, (HEREINAFTER THE LD.CIT(A)), PASSED U/S. 250 OF THE INCOME TAX ACT, 1961 (THE ACT), DT. 17/06/2019 FOR THE ASSESSMENT YEAR 2012-13. 2. THE ASSESSEE IS AN INDIVIDUAL AND IS ENGAGED IN THE BUSINESS OF TRADING IN MEDICINE UNDER THE NAME AND STYLE OF M/S. DEY ENTERPRISE. HE FILED HIS RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION ON 28/09/2012, DISCLOSING TOTAL INCOME OF RS.2,76,400/-. THE ASSESSING OFFICER PASSED THE ASSESSMENT ORDER U/S 143(3) OF THE ACT ON 28/03/2015. AT PARA 5 OF HIS ORDER, HE MADE AN ADDITION UNDER THE HEAD UNDISCLOSED STOCK. THE SUM AND SUBSTANCE OF THE ADDITION IS THAT THE ASSESSEE HAS UNRECORDED PURCHASES TO THE TUNE OF RS.11,38,825/-. ON APPEAL, THE LD. CIT(A) CONFIRMED THE ADDITION. 3. AGGRIEVED THE ASSESSEE IS IN APPEAL BEFORE THIS TRIBUNAL. 4. HEARD RIVAL CONTENTIONS. ON CAREFUL CONSIDERATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE, PERUSAL OF THE PAPERS ON RECORD, ORDERS OF THE AUTHORITIES BELOW AS WELL AS CASE LAW CITED, I HOLD AS FOLLOWS:- 5. THE ALLEGATI ON IS THAT THE ASSESSEE MADE PURCHASES OF RS.1,62,15,614/ WHEREAS HE HAS RECORDED PAYMENTS OF RS.1,58,29,257/ OPENING BALANCE OF RS.7,52,468/ WORDS, THIS AMOUNT IS A C REDIT RECEIPT BY THE ASSESSEE. THESE SUPPLIERS ARE SUNDRY CREDITORS. WHEN THESE SUNDRY CREDITORS ARE BROUGHT INTO BOOKS AND CORRESPONDING STOCK IS RECORDED THERE WOULD BE NO INCOME THAT WOULD BE LIABLE TO TAX AS UNDISCLOSED STOCK. THERE CANNOT BE AN ADDITI ON OF UNDISCLOSED CREDIT. 5.1. CONSIDERING THE ALTERNATIVE CONTENTION OF THE LD. D/R, IF THESE PURCHASES ARE TAKEN AS UNRECORDED AND THAT EQUIVALENT STOCK IS NOT AVAILABLE WITH THE ASSESSEE THEN THE ADDITION CAN BE ONLY OF A PERCENTAGE OF SUCH PURCHASES. HAS UNDISCLOSED PURCHASES OF RS.3,86,357/ UNPAID AMOUNTS CANNOT BE TAKEN INTO ACCOUNT IN THE CURRENT YEAR. UNDER THESE CIRCUMSTANCES, AT BEST A PERCENTAGE OF RS.3,86,357/ APPLYING NET PROFIT. IN MY VIEW, NET PROFIT OF 10% WOULD SERVE THE PURPOSE. HENCE THE ADDITION IS RESTRICTED TO RS. 38,635/ 6. BEFORE PARTING, IT IS NOTED THAT THE ORDER IS BEING PRONOUNCED AFTER NINETY (90) DAYS OF HEARING. HOWEVER, TAKING NOTE OF THE EXTRAORDINARY SITUATION IN THE LIGHT OF THE COVID PANDEMIC AND LOCKDOWN, THE PERIOD OF LOCKDOWN DAYS NEED TO BE EXCLUDED. FOR C SUCH A CONCLUSION, I RELY UPON THE DECISION OF THE CO IN THE CASE OF DCIT VS. JSW LIMITED IN ITA NO. 6264/MUM/2018 & 6103/MUM/2018, ASSESSMENT YEAR 2013- 14, ORDER DT. 14 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED IN PART. KOLKATA, THE DATED : 19.06.2020 {SC SPS} 2 ON IS THAT THE ASSESSEE MADE PURCHASES OF RS.1,62,15,614/ WHEREAS HE HAS RECORDED PAYMENTS OF RS.1,58,29,257/ - , AFTER TAKING INTO ACCOUNT THE OPENING BALANCE OF RS.7,52,468/ - , AND THE UNPAID AMOUNT AS RS.11,38,825/ REDIT RECEIPT BY THE ASSESSEE. THESE SUPPLIERS ARE SUNDRY CREDITORS. WHEN THESE SUNDRY CREDITORS ARE BROUGHT INTO BOOKS AND CORRESPONDING STOCK IS RECORDED THERE WOULD BE NO INCOME THAT WOULD BE LIABLE TO TAX AS UNDISCLOSED STOCK. ON OF UNDISCLOSED CREDIT. CONSIDERING THE ALTERNATIVE CONTENTION OF THE LD. D/R, IF THESE PURCHASES ARE TAKEN AS UNRECORDED AND THAT EQUIVALENT STOCK IS NOT AVAILABLE WITH THE ASSESSEE THEN THE ADDITION CAN BE ONLY OF A PERCENTAGE OF SUCH PURCHASES. DURING THE YEAR, THE ASSESSEE HAS UNDISCLOSED PURCHASES OF RS.3,86,357/ - . IN MY OPINION, THE OPENING BALANCE OF UNPAID AMOUNTS CANNOT BE TAKEN INTO ACCOUNT IN THE CURRENT YEAR. UNDER THESE CIRCUMSTANCES, AT BEST A PERCENTAGE OF RS.3,86,357/ - MAY BE CONSIDE RED AS ADDITION BY APPLYING NET PROFIT. IN MY VIEW, NET PROFIT OF 10% WOULD SERVE THE PURPOSE. HENCE THE ADDITION IS RESTRICTED TO RS. 38,635/ -. BEFORE PARTING, IT IS NOTED THAT THE ORDER IS BEING PRONOUNCED AFTER NINETY (90) DAYS OF HEARING. HOWEVER, TAKING NOTE OF THE EXTRAORDINARY SITUATION IN THE LIGHT OF THE COVID PANDEMIC AND LOCKDOWN, THE PERIOD OF LOCKDOWN DAYS NEED TO BE EXCLUDED. FOR C SUCH A CONCLUSION, I RELY UPON THE DECISION OF THE CO - ORDINATE BENCH OF THE MUMBAI TRIBUNAL DCIT VS. JSW LIMITED IN ITA NO. 6264/MUM/2018 & 6103/MUM/2018, 14, ORDER DT. 14 TH MAY, 2020. OF THE ASSESSEE IS ALLOWED IN PART. KOLKATA, THE 19 TH DAY OF JUNE, 2020. SD/- [ J. SUDHAKAR REDDY ] ACCOUNTANT MEMBER ITA NO. 1715/KOL/2019 ASSESSMENT YEARS: 2012-13 APURBA KUMAR DEY ON IS THAT THE ASSESSEE MADE PURCHASES OF RS.1,62,15,614/ - AND , AFTER TAKING INTO ACCOUNT THE , AND THE UNPAID AMOUNT AS RS.11,38,825/ -. IN OTHER REDIT RECEIPT BY THE ASSESSEE. THESE SUPPLIERS ARE SUNDRY CREDITORS. WHEN THESE SUNDRY CREDITORS ARE BROUGHT INTO BOOKS AND CORRESPONDING STOCK IS RECORDED THERE WOULD BE NO INCOME THAT WOULD BE LIABLE TO TAX AS UNDISCLOSED STOCK. CONSIDERING THE ALTERNATIVE CONTENTION OF THE LD. D/R, IF THESE PURCHASES ARE TAKEN AS UNRECORDED AND THAT EQUIVALENT STOCK IS NOT AVAILABLE WITH THE ASSESSEE THEN DURING THE YEAR, THE ASSESSEE . IN MY OPINION, THE OPENING BALANCE OF UNPAID AMOUNTS CANNOT BE TAKEN INTO ACCOUNT IN THE CURRENT YEAR. UNDER THESE RED AS ADDITION BY APPLYING NET PROFIT. IN MY VIEW, NET PROFIT OF 10% WOULD SERVE THE PURPOSE. HENCE THE BEFORE PARTING, IT IS NOTED THAT THE ORDER IS BEING PRONOUNCED AFTER NINETY (90) DAYS OF HEARING. HOWEVER, TAKING NOTE OF THE EXTRAORDINARY SITUATION IN THE LIGHT OF THE COVID -19 PANDEMIC AND LOCKDOWN, THE PERIOD OF LOCKDOWN DAYS NEED TO BE EXCLUDED. FOR C OMING TO ORDINATE BENCH OF THE MUMBAI TRIBUNAL DCIT VS. JSW LIMITED IN ITA NO. 6264/MUM/2018 & 6103/MUM/2018, COPY OF THE ORDER FORWARDED TO: 1. APURBA KUMAR DEY C/O. S.N. GHOSH & ASSOCIATES, ADVOCATES SEBEN BROTHERS LODGE P.O. BUROSHIBTALA P.S. CHINSURAH DIST.:- HOOGHLY WEST BENGAL 712 105 2. INCOME TAX OFFICER, WARD- 1(3), BURDWAN 3. CIT(A)- 4. CIT- , 5. CIT(DR), KOLKATA BENCHES, KOLKATA. 3 C/O. S.N. GHOSH & ASSOCIATES, ADVOCATES 1(3), BURDWAN CIT(DR), KOLKATA BENCHES, KOLKATA. ASSISTANT REGISTRAR ITAT, KOLKATA BENCHES ITA NO. 1715/KOL/2019 ASSESSMENT YEARS: 2012-13 APURBA KUMAR DEY TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT, KOLKATA BENCHES