Thulasi Transport, CHENNAI V. DCIT, Vellore

ITA 1800/CHNY/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 8182 (ITAT-CHENNAI)
• Duration Of Justice: 6 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-01-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 28-12-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 15-06-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V NANDA KUMAR
• Assessee Lawyers: A S SRIRAMAN
• Section: 2

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: CHENNAI . . . , !'. . # $ % , ' () BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI D.S.SUNDER SINGH, ACCOUNTANT MEMBER ./ ITA NO.1800/MDS/2016 * +* /ASSESSMENT YEAR: 2008-09 M/S.THULASI TRANSPORT, 18, KOMUTTI STREET, WALAJAPET 632 513. VS. THE DY. COMMISSIONER OF INCOME TAX, CIRCLE-I, VELLORE [PAN: AAGFM 5983 N ] ( ,- /APPELLANT) ( ./,- /RESPONDENT) ,- 0 1 / APPELLANT BY : MR.A.S.SRIRAMAN, ADV. ./,- 0 1 /RESPONDENT BY : MR.V.NANDAKUMAR, JCIT # 0 2' /DATE OF HEARING : 28.12.2016 34+ 0 2' /DATE OF PRONOUNCEMENT : 13.01.2017 / O R D E R PER D.S.SUNDER SINGH , ACCOUNTANT MEMBER : 1.0 THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST AN ORDER DATED 02.03.2016 OF COMMISSIONER OF INCOME TAX (APPEALS)- 13, CHENNAI, IN ITA NO.163/CIT(A)-13/2008-09 FOR THE AY 2008-09. 2.0 GROUND NOS.2 & 3 ARE RELATED TO THE ISSUE OF CO MMON NOTICE U/S.147 OF INCOME TAX ACT. THE LD.AR OF THE ASSESSE HAS NO T MADE ANY ARGUMENT ON ISSUE OF NOTICE. IN THIS CASE, THE ASSESSMENT W AS COMPLETED ITA NO.1800/MDS/2016 :- 2 -: U/S.143 (1) AND THE NOTICE U/S.147 WAS ISSUED ON 26 .08.2011 WITHIN THE FOUR YEARS FROM THE END OF THE RELEVANT AY. THE LD .CIT(A) IN HIS ORDER UPHELD THE VALIDITY OF NOTICE. THEREFORE, WE HOLD THAT NOTICE ISSUED U/S.147 IS VALID AND HENCE, GROUND NOS. 2 & 3 ARE DISMISSED . 3.0 THE REMAINING GROUNDS OF APPEAL ARE RELATED TO THE ADDITION OF RS.34,25,675/- REPRESENTING THE OUTSTANDING SUNDRY CREDITORS BALANCE. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OF FICER (HEREINAFTER REFERRED TO AS AO) CALLED FOR CONFIRMATION FROM T HE ASSESSE FOR THE OUTSTANDING SUNDRY CREDITORS AND THE ASSESSE FAILED TO FURNISH ANY EVIDENCE OR CONFIRMATIONS REGARDING THE OUTSTANDING SUNDRY CREDITORS. DURING THE ASSESSMENT, THE LD.AR OF THE ASSESSE AND THE PARTNER OF THE FIRM HAVE AGREED FOR THE ADDITION OF OUTSTANDING SU NDRY CREDITORS BALANCES AND THE AO MADE ADDITION. 4.0 AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSE W ENT ON APPEAL BEFORE THE LD.CIT(A) AND THE LD.CIT(A) CONFIRMED TH E ADDITION MADE BY THE AO. THEREFORE, THE ASSESSE FILED APPEAL BEFORE THIS TRIBUNAL. 5.0 DURING THE APPEAL, THE LD.AR ARGUED THAT DURING THE PENDENCY OF APPEAL, THE LD.CIT(A) HAS CALLED FOR THE REMAND REP ORT FROM THE AO AND THE ASSESSEE HAS PRODUCED THE OUTSTANDING SUNDRY CR EDITORS BEFORE THE AO BUT THE AO COULD NOT EXAMINE THE OUTSTANDING SUNDRY CREDITORS DUE TO LACK OF TIME. THEREFORE, HE INVITED OUR ATTENTION AND T HE CHRONOLOGY OF THE EVENTS DURING THE PENDENCY OF APPEAL PROCEEDINGS AN D PRODUCTION OF ITA NO.1800/MDS/2016 :- 3 -: OUTSTANDING SUNDRY CREDITORS BEFORE THE AO WHICH WA S DISCUSSED IN PAGE NO.7 OF CIT(A)S ORDER IS AS UNDER: THE APPELLANT FIRM HAS OBTAINED CONFIRMATION LETTE RS FROM THE SUNDRY CREDITORS FORM ALL THE SUNDRY CREDITORS EXCEPT THE RELIANCE PETRO MARKETIN G P LTD, AND SUBMITTED THE SAME BEFORE THE COMMISSIONER OF THE INCOME TAX APPEALS-XI ON 29 .4.2013. THE CIT APPEALS HAS REFERRED THE MATTER BACK TO ACIT TO PRODUCE THE SUN DRY CREDITORS FOR VERIFYING GENUINENESS OF THE CREDITORS. ACCORDINGLY, THE APPELLANT FIRM H AS BEEN ASKED TO PRODUCE THE SUNDRY CREDITORS BEFORE THE ACIT ON 10. 10.2013 AT 11.00 A M. THE APPELLANT FIRM A ALSO APPEARED ALONG WITH CREDITORS ON THE APPOINTED DAY AND THE C REDITORS HAVE BEEN ASKED TO WAIT AS THE ACIT IS BUSY WITH HIS SCRUTINY ASSESSMENTS UP TILL 7.30.PM AND AFTER 7.30.PM THE CREDITORS HAVE BEEN ASKED TO PRODUCE THE COPIES PAN CARD, RAT ION CARD, VOTER ID, RC BOOK, ETC., AND APPEAR ON 17,10.2013. SOME OF THE CREDITORS APPEARE D ON 17.10.13 ALONG WITH DOCUMENTS CALLED FOR BEFORE THE ACIT, VELLORE AND THEY HAVE B EEN ASKED TO COME AFTER A WEEK AS THE INCOME TAX INSPECTOR HAS BEEN BUSY WITH SOME OTHER DUTY THE CREDITORS APPEARED BEING SINGLE LORRY OWNERS COULD NOT APPEAR WITHIN A WEEK AS THEY HAVE BEEN DRIVING THEIR OWN LORRIES FOR LONG DISTANCES. THE APPELLANT ONCE AGAI N BROUGHT THE CREDITORS ON 21.11.2013; ON THAT DAY THE ACIT ASKED FOR BOOKS OF ACCOUNTS FO R WHICH THE CREDITORS BEING SINGLE LORRY OWNERS STATED THAT THEY ARE OFFERING INCOME U/S.44A E FOR THE REASON THAT THEY ARE NOT MAINTAINING BOOKS OF ACCOUNTS AND ON THAT DAY ALSO THE ACIT HAS NOT HEARD ANYTHING BUT ASKED AGAIN TO COME AFTER A WEEK AFTER THAN IT WAS NOT POSSIBLE FOR THE APPELLANT TO BRING ANY CREDITORS TO SUBMIT STATEMENT AS THEY HAVE GONE ON NORTH OF INDIA FOR THEIR LONG TRANSPORT OPERATION. THE CREDITORS ARE SINGLE LORRY OWNERS/DRIVERS WHO HAVE BEEN WORKING IN THE MUMBAI/NORTH INDIA AREA AND THEY WERE NOT ABLE TO APPEAR DURING THE 1 MONTHS FOR THE CONTINUOUS FREIGHT CARRIER-WORKS. IN ALL THE 3 DAYS WHEN THE CREDITORS APPEARED NO RECORD OF THEIR PRESENCE HAVE BEEN MADE IN THE OFFI CE OF THE ACIT. FURTHER HEARINGS HAVE BEEN IMPEDIMENTED BY THE SUDDEN DEATH OF AUTHORISED REPRESENTATIVES MOTHER ON 31.10.13 AND THE SUBSEQUENT OBSEQUIES THAT WERE PER FORMED BY HIM. ALL THE CREDITORS HAVE BEEN CARRYING ON THE BUSINES S IN NORTH INDIA AND HAVE BEEN PREVENTED FROM APPEARING BEFORE THE ACIT FOR THE RE ASON OF THEIR PRESENT CONTRACTS. FINALLY, THE ACIT ALLOWED ONE MORE HEARING ON 6.2.14 TO PROD UCE THE CREDITORS BUT THE CREDITORS APPEARANCE ON 6.2.14 BEFORE THE ACIT HAS BEEN DECLI NED STATING THAT THE REPORT STATING NON-APPEARANCE OF THE CREDITORS HAS BEEN REPORTED T O THE CIT (APPEALS)-VLL, CHENNAI. FURTHER, THE LD.AR REQUESTED FOR ONE MORE OPPORTUN ITY TO PRODUCE THE OUTSTANDING SUNDRY CREDITORS BEFORE THE AO AND TO PROVE GENUINENESS OF OUTSTANDING. ON THE OTHER HAND, THE LD.DR DID N OT OBJECT FOR GIVING ITA NO.1800/MDS/2016 :- 4 -: ONE MORE OPPORTUNITY TO THE ASSESSE IN THE BACK GRO UND OF THE CHRONOLOGY OF EVENTS DISCUSSED IN LD.CIT(A)S ORDER. 6.0 WE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL PLACED ON RECORD. THE AO STATED IN THE ASSESSMENT ORDER THAT THE ASS ESSEE HAS AGREED FOR THE ADDITION. THE ASSESSE WENT ON APPEA L BEFORE THE LD.CIT(A) STATING THAT THE ADDITION WAS AGREED UNDER THE INFL UENCE OF THE AO. AS PER THE DISCUSSIONS MADE IN THE CIT(A)S ORDER, IT APPE ARS THAT THE ASSESSEE HAS PRODUCED THE OUTSTANDING SUNDRY CREDITORS ON 10 .10.2013, 17.10.2013 AND 21.11.2013 BUT COULD NOT PRODUCE SUBSEQUENTLY, BECAUSE OF THE CIRCUMSTANCES BEYOND THE CONTROL OF THE ASSESSEE AN D THE LD.AR OF THE ASSESSE EXPLAINED THAT ALL THE OUTSTANDING SUNDRY C REDITORS BALANCES ARE GENUINE, IDENTIFIABLE AND CREDIT WORTHY, GIVEN THE OPPORTUNITY, THE ASSESSE WILL BE ESTABLISHING THE GENUINENESS OF OUT STANDING SUNDRY CREDITORS BALANCES. THEREFORE, WE ARE OF THE CONS IDERED OPINION THAT IN THE INTEREST OF THE JUSTICE, THE CASE SHOULD BE REM ITTED BACK TO THE FILE OF AO TO RE-EXAMINE THE GENUINENESS, CREDITWORTHINESS AND IDENTIFICATION OF THE OUTSTANDING SUNDRY CREDITORS. THEREFORE, WE SE T-ASIDE THE ORDERS OF THE LOWER AUTHORITIES AND REMIT THE MATTER BACK TO THE FILE OF THE AO WITH A DIRECTION TO RE-EXAMINE THE OUTSTANDING SUNDRY CRED ITORS AND DECIDE THE ISSUE AFRESH ON MERITS. ITA NO.1800/MDS/2016 :- 5 -: IN THE RESULT, THE APPEAL OF THE ASSESSE IS ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED IN THE OPEN COURT ON 13 TH JANUARY, 2017, AT CHENNAI. SD/- SD/- ( . . . ) (N.R.S. GANESAN) /JUDICIAL MEMBER ( !' . . # $ % ) (D.S.SUNDER SINGH) ' /ACCOUNTANT MEMBER /CHENNAI, 5 /DATED: 13 TH JANUARY, 2017. TLN 0 .2$6 76+2 /COPY TO: 1. ,- /APPELLANT 4. # 82 /CIT 2. ./,- /RESPONDENT 5. 69 .2 /DR 3. # 82 ( ) /CIT(A) 6. '* < /GF