Late Mrs. Kamaladevi Omprakash Itara, Ahmednagar V. Income-tax Officer,

ITA 1719/PUN/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 0483 (ITAT-PUNE)
• Duration Of Justice: 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-11-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 11-08-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUMITRA BANERJI
• Keywords: Additional evidence
• Section: 133(6); 68

Judgement Text

- IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC , PUNE , BEFORE MS. SUSHMA CHOWLA, JM . / ITA NO. 1719 /PN/201 6 / ASSESS MENT YEAR : 20 12 - 13 LATE MRS. KAMALADEVI OMPRAKASH ITARA L/H MR. OMPRAKASH MANGATRAM ITARA, PROP. M/S. SHRI OM TEXTILES, OPP. CHHAYA TALKIES, CHITALE ROAD, AHMEDNAGAR - 414001 . / APPELLANT PAN: A AIPI8069F VS. VS. THE INCOME TAX OFFICER , WAR D 3, AHMEDNAGAR . / RESPONDENT / APPELLANT BY : SHRI C.H. NANIWADEKAR / RESPONDENT BY : SMT. SUMITRA BANERJI / DATE OF HEARING : 0 5 . 1 0 .201 6 / DATE OF PRON OUNCEMENT: 11 . 1 1 .201 6 / ORDER PER SUSHMA CHOWLA, J M : TH IS APPEAL FILED BY THE ASSESSEE IS AGAINST THE ORDER OF CIT (A) - 2 , PUNE , DATED 2 5 . 0 5 .20 1 6 RELATING TO ASSESSMENT YEAR 20 12 - 13 AGAINST ORDER PASSED UNDER SECTION 1 4 3(3) OF THE INCOME - TAX ACT , 1961 (IN SHORT THE ACT) . ITA NO. 1719 /PN/20 1 6 LATE MRS. KAMALA DEVI OMPRAKASH ITARA 2 2 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : - GROUNDS OF APPEAL: 1 . THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)2 PUNE HAS ERRED IN LAW AND ON THE FACTS IN PASSING THE ORDER WITHOUT TAKING ON RECORD T HE LEGAL HEIR OF THE DE CE A S ED. THAT THE ORDER PASSED BY THE CIT(A) IS BAD - IN - IAW AND HENCE THE SAME BE SET ASIDE. ALTERNA TIVE GROUND: 2 . THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)2 PUNE HAVE ERRED IN PASSING THE ORDER WITHOUT ALLOWING OPPORTUN ITY TO PRODUCE ADDITIONAL EVIDENCE, AND THERE BY DISMISSED THE APPEAL. THAT THE APPELLANT MAY BE EVIDENCE, AND THERE BY DISMISSED THE APPEAL. THAT THE APPELLANT MAY BE ALLOWED TO PRODUCE ADDITIONAL EVIDENCE U/R 46A OF I.T. ACT WHICH IS RELEVANT WITH THE ADDITION MADE BY A.O. 3 . THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPE ALS)2, PUNE HAVE ERRED ON THE FACTS AND IN LAW IN CONFIRMING THE ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT FICTITIOUS TRADE CREDITOR OF RS.2 , 45 , 345/ - . THAT THE ADDITION MADE BY A.O AND CONFIRMED BY CIT (A) BE DELETED. 3. THE GROUND OF APPEAL NO.1 RAISED BY THE ASSESSEE IS NOT PRESSED AND HENCE, THE SAME IS DISMISSED AS NOT PRESSED. 4. THE ISSUE IN GROUND OF APPEAL NO.2 RAISED BY THE ASSESSEE IS AGAINST NON - ALLOWANCE OF OPPORTUNITY BY THE CIT(A) TO PRODUCE THE ADDITIONAL EVIDENCE AND CONFIRMING THE ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT OF FICTITIOUS TRADE CREDITOR OF RS.2,45,345/ - . 5. BRIEFLY, IN THE FACTS OF THE CASE, THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION HAD FURNISHED THE RETURN OF INCOME DECLARING INCOME AT RS.2,63,590/ - . TH E ASSESSEE WAS ENGAGED IN THE BUSINESS OF PURCHASE AND SALE OF SAREES, CLOTH, ETC. ON WHOLESALE BASIS. FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD DECLARED LOWER GP AS COMPARED TO THE EARLIER YEAR. THE EXPLANATION FILED BY THE ASSESSEE IN THIS REG ARD WAS ACCEPTED AND ITA NO. 1719 /PN/20 1 6 LATE MRS. KAMALA DEVI OMPRAKASH ITARA 3 NO ADDITION WAS MADE IN THE HANDS OF ASSESSEE ON THIS ACCOUNT. HOWEVER, THE ASSESSING OFFICER SOUGHT INFORMATION UNDER SECTION 133(6) OF THE ACT FROM THE SUNDRY CREDITORS SHOWN BY THE ASSESSEE. ON VERIFICATION OF BALANCE SHEET, THE A SSESSING OFFICER NOTED THAT THE ASSESSEE HAD SHOWN CREDIT BALANCE OF RS. 2,85,345/ - AS ON 31.03.2012 IN THE NAME OF MUNDRA SAREES. ON THE ADDRESS PROVIDED BY THE ASSESSEE, NOTICE UNDER SECTION 133(6) OF THE ACT WAS ISSUED WHICH WAS RETURNED BACK BY THE POS TAL AUTHORITY WITH THE REMARKS ADDRESS MOVED. THE ASSESSEE WAS ASKED TO PROVIDE COMPLETE P OSTAL ADDRESS OF MUNDRA SAREES AND IN REPLY, THE ASSESSEE PROVIDED THE SAME ADDRESS AS PROVIDED EARLIER. THE ASSESSING OFFICER WAS OF THE VIEW THAT THE SAID CONCE RN DID NOT EXIST IN WHOSE NAME THE ASSESSEE HAD SHOWN CREDIT BALANCE OF RS. 2,85,345/ - AND THE SAID AMOUNT WAS ADDED AS INCOME OF THE ASSESSEE. 6. THE ASSESSEE BEFORE THE CIT(A) POINTED OUT THAT SHE HAD FILED THE LEDGER EXTRACT OF MUNDRA SAREES DURING THE ASSESSMENT PROCEEDINGS AND EVEN SALE BILLS ISSUED BY THE SAID DEALER. THE PURCHASES MADE FROM MUNDRA SAREES HAVE NOT BEEN DOUBTED BY THE ASSESSING OFFICER. ANOTHER PLEA WAS THAT THE PURCHASES WERE ENTERED INTO THE STOCK REGISTER WHICH W AS ALSO PRODUCED F OR VERIFICATION. ON ENQUIRY ABOUT THE NON - SERVICE OF SUMMONS WITH THE NEIGHBOURS OF MUNDRA SAREES THAT THE DEALER HAD GONE TO HIS NATIVE PLACE IN RAJASTHAN AS HIS MOTHER WAS SERIOUSLY ILL AND THE SHOP WAS CLOSED FOR SOME TIME. THE ASSESSEE ALSO EXPLAINED THAT THE ASSESSING OFFICER GAVE VERY SHORT TIME TO FURNISH THE CONFIRMATION . THE CASE OF ASSESSEE BEFORE THE CIT(A) WAS THAT IT WAS PREVENTED BY SUFFICIENT CAUSE FROM PRODUCING THE SAID EVIDENCE BEFORE THE ASSESSING OFFICER. HOWEVER, AN APPLICATION WAS MADE TO ADMIT THE ADDITIONAL ITA NO. 1719 /PN/20 1 6 LATE MRS. KAMALA DEVI OMPRAKASH ITARA 4 EVIDENCE BEFORE THE CIT(A), WHO IN TURN, REJECTED THE SAME AND UPHELD THE ADDITION MADE BY THE ASSESSING OFFICER. 7. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF CIT(A). 8. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSE SSEE POINTED OUT THAT IT IS NOT CLEAR WHETHER THE ADDITION WAS MADE UNDER SECTION 68 OF THE ACT OR ANY OTHER PROVISIONS OF THE ACT. ATTENTION WAS DRAWN TO THE BILLS ISSUED BY THE SAID PARTY, WHICH ARE PLACED AT PAGES 12 TO 23 OF THE PAPER BOOK. ATTENTION FURTHER WAS DRAWN TO THE COPY OF ACCOUNT PLACED AT PAGE 3 OF THE PAPER BOOK. HE FURTHER POINTED OUT THAT THE PAYMENTS WERE MADE TO THE SAID CONCERN BY CHEQUE IN THE SUCCEEDING YEAR AS REFLECTED IN THE STATEMENT PLACED AT PAGE 3 OF THE PAPER BOOK. THE LE ARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE IN TURN, REFERRED TO THE BANK STATEMENT OF THE ASSESSEE IN AHMEDNAGAR MERCHANTS CO - OP. BANK LTD. TO WHICH THE SAID PAYMENTS WERE DEBITED. 9. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE ON THE OTHER HAND, RELIED ON THE ORDER OF CIT(A) AND POINTED OUT THAT THIS WAS AN ADDITIONAL EVIDENCE. 10. ON PERUSAL OF RECORD AND AFTER HEARING BOTH THE LEARNED AUTHORIZED REPRESENTATIVES, THE ISSUE WHICH NEEDS TO BE ADJUDICATED IN THE PRESENT APPEAL IS AGAIN ST THE ADDITION OF RS. 2,45,345/ - . THE ASSESSEE WAS ENGAGED IN THE TRADING OF SAREES, CLOTH, ETC. IN THE LIST OF SUNDRY CREDITORS, THE ASSESSEE HAD SHOWN SUM OF RS.2,45,345/ - DUE TO ONE MUNDRA SAREES OF SURAT. THE ASSESSING OFFICER IN ORDER TO VERIFY THE CORRECTNESS OF TRADE CREDITOR HAD ISSUED ITA NO. 1719 /PN/20 1 6 LATE MRS. KAMALA DEVI OMPRAKASH ITARA 5 SUMMONS UNDER SECTION 133(6) OF THE ACT UPON THE SAID PERSON, WHICH COULD NOT BE SERVED AND THE SAME WERE RETURNED BACK. THE ASSESSEE WAS ASKED TO FILE CONFIRMATION FROM THE SAID PERSON. HOWEVER, THE ASSESSEE WAS UNABLE TO DO SO, SINCE THE SAID PARTY WAS NOT AVAILABLE IN THE SAID ADDRESS. HOWEVER, BEFORE THE CIT(A), THE ASSESSEE FILED FURTHER EVIDENCE THAT THE SUM DUE OF RS.2,45,345/ - WAS PAID BY WAY OF CHEQUE TO THE SAID PARTY IN THE SUCCEEDING YEAR MUCH BEFORE CLOSE OF THE ASSESSMENT PROCEEDINGS. THE SAID ADDITIONAL EVIDENCE FILED BY THE ASSESSEE I.E. COPY OF ACCOUNT IN ITS BOOKS OF ACCOUNT FOR THE PERIOD 01.04.2012 TO 31.03.2013 AND THE RELEVANT ENTRIES IN THE BANK ACCOUNT WERE FILED AS ADDITIONAL EVIDENCE BEF ORE THE CIT(A) WHICH WAS NOT ACCEPTED AND THE ADDITION WAS CONFIRMED. 11. THE FIRST ASPECT TO BE NOTED IN THE PRESENT CASE IS THE CLAIM OF ASSESSEE THAT THE PURCHASES MADE FROM DAY - TO - DAY WERE ENTERED IN THE PURCHASE REGISTER AND PURCHASES MADE BY THE ASS ESSEE HAVE BEEN ACCEPTED IN ENTIRETY BY THE ASSESSING OFFICER. THE ASSESSEE HAVING MAINTAINED COMPLETE DATA OF PURCHASES, WHICH IN TURN, WERE ENTERED IN THE BOOKS OF ACCOUNT AND STOCK REGISTER , MERELY BECAUSE CERTAIN INFORMATION COULD NOT BE FILED DURING THE COURSE OF ASSESSMENT PROCEEDINGS BECAUSE OF UNAVAILABLE OF THE SAID SUNDRY CREDITOR DOES NOT JUSTIFY THE ORDER OF CIT(A). WHERE THE ASSESSEE HAD FURNISHED ADDITIONAL EVIDENCE IN THE FORM OF BANK STATEMENT WHICH EVIDENCES THE PAYMENT OF DUE AMOUNT OF R S. 2,85,345/ - TO THE SAID CONCERN BY CHEQUE, WHICH WAS ADMITTEDLY PAID DURING THE FINANCIAL YEAR 2012 - 13 MUCH BEFORE PASSING OF THE ASSESSMENT ORDER ON 25.03.2015, THE SAID EVIDENCE SHOULD HAVE BEEN ACCEPTED BY THE CIT(A) IN ORDER TO ADJUDICATE THE ISSUE. THE SAID ADDITIONAL EVIDENCE IS ADMITTED AND THE ADDITION MADE ON THIS ACCOUNT IS DELETED . ITA NO. 1719 /PN/20 1 6 LATE MRS. KAMALA DEVI OMPRAKASH ITARA 6 REVERSING THE ORDER OF CIT(A), THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE ALLOWED. 1 2 . IN THE RESULT, THE APPEAL OF ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON THIS 11 TH DAY OF NOVEMBER , 201 6 . SD/ - (SUSHMA CHOWLA) / JUDICIAL MEMBER / PUNE ; DATED : 11 TH NOVEMBER , 201 6 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT(A) - 2 , PUNE ; 4. / THE PR. CIT - 1 , PUNE ; 5. 6. , , , - / DR SMC , ITAT, PUNE; / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE