ITO WD 1(4), THANE V. LACHMAN SOBHRAJMAL PAMNANI, THANE

ITA 1931/MUM/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 93104 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 3 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2015
• Appeal Filed By: Department
• Bench Allotted: A
• Next Hearing Date: 10-06-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 11-03-2013
• Court: TRIBUNAL
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER AND SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER I.T.A. NO.1931//M/2013 (AY:2009 - 2010 ) ITO, WD 1(4), ASHAR I.T. PARK, ROAD NO.16Z, MIDC, WAGLE INDL. ESTATE, THANE (W), THANE. / VS. LACHMAN SOBHRAJMAL PAMNANI, F - 138 PREM NAGAR SOC. KOPRI COLONY, THANE. ./ PAN : AGQPP5067L ( / APPELLANT) .. ( / RESPONDENT ) / APPELLANT BY : SHRI JEEVAN LAL LAVIDIYA / RESPONDENT BY : NONE / DATE OF HEARING : 10 .06.2015 / DATE OF PRONOUNCEMENT :30 .06.2015 / O R D E R PER D. KARUNAKARA RAO, AM: THIS APPEAL FILED BY THE REVENUE ON 11.3.2013 IS AGAINST THE ORDER OF THE CIT (A) - II, THANE DATED 30.11.2012 FOR THE ASSESSMENT YEAR 2009 - 2010. IN THIS APPEAL, REVENUE RAISED THE FOLLOWING GROUNDS WHICH READ AS UNDER: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT (A) ERRED IN DELETING THE ADDITION OF RS. 14,00,000/ - ON ACCOUNT OF SUNDRY CREDITORS. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD CIT (A) ERRED IN ADMITTING FRESH EVIDENCE DURING THE COURSE OF APPEAL PROCEEDINGS ON THE B ASIS OF WHICH THE DELETION OF RS. 14,00,000/ - WAS MADE WITHOUT GIVING AN OPPORTUNITY TO THE AO TO EXAMINE THE FRESH EVIDENCE. THIS IS IN VIOLATION OF RULE 46A OF THE INCOME TAX RULES, 1962. THE EVIDENCE WAS NOT PRODUCED BEFORE THE AO DURING ASSESSMENT PR OCEEDINGS. 2. BRIEFLY STATED RELEVANT FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL ENGAGED IN THE BUSINESS OF CONSTRUCTION WORK AND BUILDING REPAIR WORK. ASSESSEE FIELD THE RETURN DECLARING THE TOTAL INCOME OF RS. 1,44,502/ - . ASSESSMENT WAS COMPLETED U/S 143(3) OF THE ACT AND THE ASSESSED INCOME WAS DETERMINED AT RS. 26,07,718/ - . IN THE ASSESSMENT AO MADE CERTAIN DISALLOWANCES AMOUNTING TO RS. 24,63,216/ - AND RS. 17 LAKHS IS ONE OF SUCH DISALLOWANCE MADE ON ACCOUNT OF SUNDRY CREDITORS. AGGR IEVED, ASSESSEE CARRIED THE APPEAL BEFORE THE FIRST APPELLATE AUTHORITY. 3. DURING THE PROCEEDINGS BEFORE THE FIRST APPELLATE AUTHORITY, AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, CIT (A) RESTRICTED THE DISALLOWANCE TO RS. 3 LAKHS AS AN UNEXPLAINED AMOUNT AND GAVE RELIEF TO THE EXTENT OF RS. 14 LAKHS. AGGRIEVED WITH THE SAID DECISION OF THE CIT (A), REVENUE IS IN APPEAL BEFORE THE TRIBUNAL BY RAISING THE ABOVE MENTIONED GROUNDS. DURING THE PROCEEDINGS BEFORE US, NONE APPEARED ON BEHALF OF THE ASSES SEE. 4. ON THE OTHER HAND, LD DR FOR THE REVENUE RELIED ON THE ORDER OF THE AO. 5. WE HAVE HEARD THE LD DR FOR THE REVENUE AND PERUSED THE ORDERS OF THE REVENUE AUTHORITIES AS WELL AS THE RELEVANT MATERIAL PLACED ON TO THE RECORD. ON PERUSAL OF THE ORDER OF THE CIT (A) IN GENERAL AND PARA 4.1 IN PARTICULAR, WE FIND THE SAME IS RELEVANT IN THIS REGARD. CONSIDERING THE IMPORTANCE OF THE SAID PARA 4.1 AND FOR THE SAKE OF COMPLETENESS OF THIS ORDER, THE SAID PARA IS EXTRACTED AS FOLLOWS: 4.1. IN RESPECT OF T HE SUNDRY CREDITOR OF RS. 17,00,000/ - SHOWN IN THE BALANCE SHEET, THE APPELLANT HAS SUBMITTED THAT HE HAD ENTERED INTO A SUB - CONTRACT AGREEMENT WITH M/S. MOHAN CONSTRUCTIONS & SUPPLIERS WHO CARRIED OUT THE WORK ON BEHALF OF THE APPELLANT. FOR CARRYING OUT THE WORK OF THE APPELLANT, A CREDIT ENTRY IN THE ACCOUNT OF M/S. MOHAN CONSTRUCTIONS & SUPPLIERS HAS BEEN MADE RESULTING TO LIABILITY OF RS. 17,00,000/ - . A CONFIRMATION IN THIS REGARD ALONG WITH THE COPY OF SUB - CONTRACT AGREEMENT AND FORM NO.16A ARE ALSO FILED. ON PERUSAL OF THE COPY OF ACCOUNT, IT IS NOTICED THAT RS. 3,00,000/ - HAVE BEEN CREDITED IN THE ACCOUNT OF M/.S MOHAN CONSTRUCTIONS & SUPPLIERS ON ACCOUNT OF MONEY RECEIVED. HOWEVER, THE BALANCE AMOUNT OF RS. 14,00,000/ - HAS BEEN CREDITED ON 30.3. 2009 ON ACCOUNT OF SUB - CONTRACT AMOUNT PAYABLE. SINCE, THE APPELLANT HAS SHOWN SUB - CONTACT WORK CARRIED OUT THROUGH M/S. MOHAN CONSTRUCTIONS & SUPPLIERS AT RS. 41,31,402/ - AS PER FORM 16A OUT OF WHICH RS. 14,00,000/ - WAS PAYABLE AS ON 31.3.2009, THE SUNDR Y CREDITOR TO THE EXTENT OF RS. 14,00,000 - CANNOT BE CONSIDERED AS NON - GENUINE. MOREOVER, THE RECEIPTS ON ACCOUNT OF CONTRACT WORK HAVE BEEN CONSIDERED AS GENUINE ALONG WITH SUB - CONTRACT EXPENSES BY THE AO. THEREFORE, SUNDRY CREDITOR PAYABLE TO THE EXTEN T OF RS. 14 LAKHS IN THE NAME OF M/S MOHAN CONSTRUCTIONS & SUPPLIERS CANNOT BE CONSIDERED AS NON - GENUINE. MOREOVER, THE RECEIPTS ON ACCOUNT OF CONTRACT WORK HAVE BEEN CONSIDERED AS GENUINE ALONG WITH SUB - CONTRACT EXPENSES BY THE AO. THEREFORE, SUNDRY CREDITORS PAYABLE TO THE EXTENT OF RS. 14 LAKHS IN THE NAME OF M/S. MOHAN CONSTRUCTIONS & SUPPLIERS CANNOT BE TREATED AS NON - GENUINE. HOWEVER, THE APPELLANT HAS FAILED TO PROVE THE SOURCE OF CREDIT OF RS. 3,00,000/ - BY SUPPORTING DOCUMENTARY EVIDENCE SUCH AS COPY OF BANK ACCOUNT, BALANCE SHEET ETC SHOWN IN THE NAME OF M/S. MOHAN CONSTRUCTIONS & SUPPLIERS. THEREFORE, I AM OF THE CONSIDERED VIEW THAT SUNDRY CREDIT TO THE EXTENT OF RS. 3,00,000/ - REMAINED UNEXPLAINED AND ACCORDINGLY, THE ADDITION TO THIS ACC OUNT IS CONFIRMED. THE AO IS DIRECTED TO DELETE THE ADDITION OF RS. 14.00 LAKHS OUT OF RS. 17.00 LAKHS MADE ON ACCOUNT OF UNEXPLAINED SUNDRY CREDITORS. EVENTUALLY THE APPELLANT SUCCEEDS PARTLY ON THIS ACCOUNT. 6. CONSIDERING THE ABOVE, WE FIND THE ORDE R OF THE CIT (A) IS REASONABLE AND IT DOES NOT CALL FOR ANY INTERFERENCE. ACCORDINGLY, GROUNDS RAISED BY THE REVENUE ARE DISMISSED. 7. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNC ED IN THE OPEN COURT ON 30 TH JUNE, 2015. SD/ - SD/ - (I.P. BANSAL) (D. KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; 30 .6 .2015 . . ./ OKK , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI