M/s.Bandeshwar Krupa Trading Co., Yadgir V. Income Tax Officer, Gulbarga

ITA 177/BANG/2017

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 5373 (ITAT-BANGALORE)
• Duration Of Justice: 3 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-05-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 24-01-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Revised return
• Section: 139(5)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC - B BENCH : BANGALORE BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER ITA NO.177/BANG/2017 ASSESSMENT YEAR : 2012-13 M/S. BANDESHWAR KRUPA TRADING CO., NO.10, APMC YARD, NEW BASAVESHWAR GUNJ, YADGIR 585 201. DISTRICT YADGIR. PAN: AAIFB 2397K VS. THE INCOME TAX OFFICER, WARD 2, GULBARGA. APPELLANT RESPONDENT APPELLANT BY : SMT. PRATIBHA R., ADVOCATE RESPONDENT BY : SHRI A.R.V. SREENIVASAN, JT.CIT(DR)(ITAT) BENGALURU DATE OF HEARING : 02.03.2017 DATE OF PRONOUNCEMENT : 19.05.2017 O R D E R THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST TH E ORDER OF CIT(APPEALS) INTER ALIA ON THE FOLLOWING GROUNDS:- 1. THE LEARNED CIT (APPEALS) ERRED IN PASSING TH E ORDER IN THE MANNER HE DID. 2. THE LEARNED CIT (APPEALS) OUGHT TO HAVE APPRECIAT ED THAT THE PARTNER IN HIS INDIVIDUAL RETURN HAS SHOWN THE INCOME OF RS.3,63,442/- INSTEAD OF THE CORRECT AMOUNT OF RS.7 ,85,542/-. ACCORDINGLY, THE ADDITION OF RS.4,22,100/- WAS TO B E MADE IN PARTNERS HAND AND NOT IN THE HANDS OF THE FIRM-APP ELLANT. THUS, ITA NO. 177/BANG/2017 PAGE 2 OF 5 THE ADDITION MADE IN THE HANDS OF THE FIRM IS REQUI RED TO BE DELETED. 3. THE LEARNED CIT (APPEALS) ERRED IN NOT CONSIDERIN G THE BOOKS OF ACCOUNT AND AGRICULTURE PATTIES FOR GENUIN ENESS OF THE CREDITS FOR THE SALE OF AGRICULTURE PRODUCE IN THE HANDS OF THE PARTNER. THEREFORE, THE ADDITION MADE IN FIRM'S HAN D OUGHT TO BE DELETED. 4. WITHOUT PREJUDICE, THE ADDITION AS CONFIRMED BY T HE LEARNED CIT (APPEALS) IS EXCESSIVE, UNREASONABLE AN D OUGHT TO BE DELETED IN FULL. 5. THE LEARNED CIT (APPEALS) ERRED IN CONFIRMING THE LEVY OF INTEREST UNDER SECTIONS 234A & 234C OF THE ACT. 6. FOR THESE AND SUCH OTHER GROUNDS THAT MAY BE U RGED AT THE TIME OF HEARING, THE APPELLANT PRAYS THAT THE APPEAL MAY BE ALLOWED. 2. THE FACTS IN BRIEF BORNE OUT FROM THE RECORD ARE THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF SALE OF AGRICULTURAL PRO DUCE. SHRI SIDDAPPA GOUDA M. PATIL REPRESENTING HIS HUF AND SHRI SIDRAM AREDDY M. PATIL IN HIS INDIVIDUAL CAPACITY ARE THE PARTNERS OF THE ASSESSE E FIRM. WHILE COMPLETING THE ASSESSMENT, THE AO HAS MADE AN ADDITION OF RS. 4,22,100 TOWARDS EXCESS OF LIABILITY CRATED IN THE BOOKS OF ACCOUNT IN RESPECT OF UNSECURED LOANS AS ON 31.03.2012 ON THE GROUND THAT IN THE LO AN ACCOUNT OF SHRI SIDDAPPA GOUDA M. PATIL IN THE FIRMS ACCOUNT, THE LOAN AMOUNT OUTSTANDING IS RS.21,92,235 WHEREAS IN THE RETURN O F INCOME FILED BY SHRI SIDDAPPA GOUDA M. PATIL, THE OUTSTANDING LOAN AMOUN T PAYABLE BY THE ASSESSEE FIRM IS RS.17,70,135. ITA NO. 177/BANG/2017 PAGE 3 OF 5 3. AGGRIEVED, THE ASSESSEE HAS PREFERRED APPEAL BEF ORE THE CIT(APPEALS), BUT THE CIT(APPEALS) WAS NOT CONVINCE D WITH THE EXPLANATION FURNISHED BY THE ASSESSEE AND HE CONFIRMED THE ADDI TION. 4. NOW THE ASSESSEE HAS PREFERRED AN APPEAL BEFORE THE TRIBUNAL AND INVITED OUR ATTENTION TO THE REVISED RETURN OF INCO ME OF SHRI SIDDAPPA GOUDA M. PATIL, IN WHICH THE TOTAL AGRICULTURAL INC OME WAS SHOWN AT RS.7,85,542. THE LD. COUNSEL FOR THE ASSESSEE HAS MADE HIS EFFORTS TO EXPLAIN THE DISCREPANCY IN THE ACCOUNTS OF THE FIRM AND THE ASSESSEE WITH THE SUBMISSION THAT IN FACT THERE IS NO EXCESS LIAB ILITY SHOWN BY THE FIRM. 5. THE LD. DR, ON THE OTHER HAND, HAS SUBMITTED THA T INITIALLY THE AGRICULTURAL INCOME WAS AT RS.3,63,442 AND THE SAME WAS REVISED WHEN THE AO HAS MADE AN ADDITION ON ACCOUNT OF DIFFERENC E IN LIABILITIES. THEREFORE, THERE IS NO VALID JUSTIFICATION FOR SHOW ING LESS AGRICULTURAL INCOME. 6. HAVING CAREFULLY EXAMINED THE ORDER OF LOWER AUT HORITIES, I FIND THAT THE AO HAS PICKED UP THE CORRECT FIGURE OF AGRICULT URAL INCOME AT RS.3,63,442 WHICH WAS REVISED EVEN AFTER THE ASSESS MENT ORDER. THEREFORE, THE COGNIZANCE OF REVISED RETURN CANNOT BE TAKEN. REVISION IS ALWAYS POSSIBLE AT THE MOST BEFORE COMPLETION OF TH E ASSESSMENT. AS PER THE PROVISIONS OF SECTION 139(5) OF THE I.T. ACT, 1 961, REVISED RETURN CAN ONLY BE FILED AT ANY TIME EITHER BEFORE EXPIRY OF O NE YEAR FROM THE RELEVANT ITA NO. 177/BANG/2017 PAGE 4 OF 5 ASSESSMENT YEAR, OR BEFORE COMPLETION OF ASSESSMENT , WHICHEVER IS EARLIER. IN THE INSTANT CASE, THE REVISED RETURN WAS FILED E VEN AFTER THE COMPLETION OF ASSESSMENT. THEREFORE, IT IS NOT A VALID REVISED R ETURN AND NO COGNIZANCE CAN BE TAKEN THEREOF. IN THE LIGHT OF THESE FACTS, SINCE THERE WAS DIFFERENCE IN THE OUTSTANDING LIABILITIES, THE LOWER AUTHORITI ES HAVE RIGHTLY MADE THE ADDITION. THE CIT(APPEALS) HAS DISCUSSED THE ISSUE IN DETAIL IN HIS ORDER AND I FIND NO INFIRMITY THEREIN. HOWEVER, FOR THE SAKE OF REFERENCE, I EXTRACT THE RELEVANT OBSERVATIONS OF CIT(APPEALS) AS UNDER: - 5.0. I HAVE CAREFULLY GONE THROUGH THE FACTS OF THE CASE P ERUSED THE ASSESSMENT ORDER AND CONSIDERED THE ARGUMENTS O F THE AR. I DO NOT AGREE WITH THE CONTENTIONS OF THE APPELLANT- FIRM. THE AO AT PARA NOS 2,3,4 & 4(A) OF THE ASSESSMENT ORDER HA S CLEARLY PRESENTED THE FACTS OF THE CASE. THERE ARE AS MANY AS FIVE HEARINGS IN THIS CASE BY THE AO. BOOKS OF ACCOUNT AND OTHER DETAILS AS CALLED FOR HAVE BEEN SUBMITTED. BOTH THE PARTNERS A RE MANAGING PARTNERS DRAWING REMUNERATION. DURING THE HEARING B EFORE THE AO, DETAILS OF SUNDRY CREDITORS AND UNSECURED LOAN CREDITORS WERE FURNISHED. A DETAILED NOTE ON THE BUSINESS ACT IVITIES OF THE FIRM WAS ALSO SUBMITTED TO THE AO BY THE A.R AND TH E AO HAS VERIFIED THE DETAILS OF UNSECURED LOAN CREDITORS AP ART FROM VERIFYING OTHER INFORMATION FURNISHED. THE AO HAS A LSO VERIFIED COPIES OF RETURNS OF INCOME FILED BY THE PARTNERS. THE AO VIDE PARA NO. 4(A) OF THE ASSESSMENT ORDER HAD GIVEN A C LEAR FINDING THAT THE OUTSTANDING LOAN AMOUNT PAYABLE BY THE APP ELLANT FIRM TO THE PARTNER, SRI. SIDDAPPA GOWDA H PATIL AS ON 31.0 3.2012 IS ONLY RS. 17,70,135/- AND NOT RS. 21,92,235/- AS SHOWN IN THE BOOKS OF ACCOUNT OF THE APPELLANT FIRM LEADING TO THE DIFFER ENCE OF RS. 4,22,100/- WHICH REPRESENTS EXCESS OF LIABILITY CRE ATED BY THE APPELLANT FIRM. THUS, THERE IS A CLEAR CUT DEMONS TRATION BY THE AO. THE IMPUGNED LOAN CREDITOR IS NONE OTHER THAN O NE OF THE MANAGING PARTNERS OF THE FIRM, THAT TOO A WORKING P ARTNER. I DO NOT THINK THAT THIS IS A MISTAKE THAT HAS CREPT IN BY INADVERTENCE. THE APPELLANT CANNOT THROW THE BURDEN ON TO THE PAR TNER. I FULLY AGREE WITH THE AO AND I CONFIRM THE DISALLOWANCE OF RS 4,22,100/-. THUS ALL THE GROUNDS OF APPEAL ARE DISM ISSED. ITA NO. 177/BANG/2017 PAGE 5 OF 5 7. SINCE NO DEFECT IS NOTICED IN THE ORDER OF CIT(A PPEALS), I CONFIRM THE SAME. 8. IN THE RESULT, THE APPEAL OF ASSESSEE IS DISMISS ED. PRONOUNCED IN THE OPEN COURT ON THIS 19 TH DAY OF MAY, 2017. SD/- (SUNIL KUMAR YADAV ) JUDICIAL MEMBER BANGALORE, DATED, THE 19 TH MAY, 2017. / D ESAI S MURTHY / COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR, ITAT, BANGALORE.