ACIT, Madurai V. M/s. MVM Subramania Nadar & Sons, Madurai

ITA 196/CHNY/2010

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 4514 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-07-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 30-06-2010
• Assessment Year: 2006-2007
• Appeal Filed On: 18-02-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: OMKARESHWAR CHIDRA
• Assessee Lawyers: M BALASUBRAMANIYAM
• Section: 191

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BENCH D CHENNAI BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AN D SHRI GEORGE MATHAN, JUDICIAL MEMBER I.T.A. NOS. 191, 192, 193, 194, 195, 196 AND 197/MD S/2010 ASSESSMENT YEARS: 2001-02, 02-03, 03-04, 04-05, 05 -06, 06-07 AND 07-08 THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE III, MADURAI.. VS. M/S. MVM SUBRAMANIA NADAR & SONS, NO. 39, MADURAI MAIN ROAD, THIRUMANGALAM, MADURAI 625 706. [PAN: AABFM5457G] (APPELLANT) (RESPONDENT) REVENUE BY : SHRI OMKARESHWAR CHIDRA ASSESSEE BY : SHRI M. BALASUBRAMANIYAM O R D E R PER BENCH THESE ARE THE APPEALS FILED BY THE REVENUE AGAINST THE CONSOLIDATED ORDER OF THE LD. CIT(A) II, MADURAI IN APPEAL NOS. 209 TO 215/2008-09 DATED 30.11.2009 FOR THE ASSESSMENT YEARS 2001-02 TO 2007 -08. SHRI OMKARESHWAR CHIDRA, LD. CIT DR REPRESENTED ON BEHALF OF THE REV ENUE AND SHRI M. BALASUBRAMANIYAM, CA REPRESENTED ON BEHALF OF THE A SSESSEE. IN THE REVENUES APPEAL, THE REVENUE HAS RAISED THE FOLLOWING GROUND S: 1.A. THE ORDER OF THE LD. CIT(A) GRANTING RELIEF TOWARDS ADDITION ON ACCOUNT OF UNACCOUNTED SALES IS CONTRARY TO LAW AN D OPPOSED TO THE FACTS OF THE CASE. 1.B. THE CIT(A) HAS HELD THAT THE ADDITION WAS BASE D ON CONJUNCTURE, SUSPICION AND SURMISES. BUT, HE HAS I GNORED THAT THE FACT OF UNACCOUNTED SALES ON RETAIL CUSTOMERS WAS ADMITTED BY THE MANAGER AND IS IN CONFORMITY WITH THE MARKET TREND WHERE RETAIL CUSTOMERS HARDLY INSIST FOR BIL LS. FURTHER, SINCE THESE BILLS HAVE NOT BEEN ISSUED AND ACCOUNT ED FOR THAT DOES NOT MEAN THAT THE ASSESSEE IS ENGAGED IN WHOS ESALE BUSINESS ONLY, ESPECIALLY WHEN THE MANAGER HIMSELF HAS STATED THE FACTS CONTRARY TO THE CONCLUSION OF CIT (A). 1.C. THE CIT(A) OUGHT TO HAVE NOTED THAT THE JURISD ICTIONAL HIGH COURT IN THE CASE OF P. GOVINDASAMY VS. CIT 244 IT R 510 (MDS) AND THE GUJARAT HIGH COURT IN THE CASE OF RA MILABEN I.T.A. NO I.T.A. NO I.T.A. NO I.T.A. NOS SS S. .. . 191 TO 197 191 TO 197 191 TO 197 191 TO 197/MDS/ /MDS/ /MDS/ /MDS/1 11 10 00 0 2 RATILAL SHAH VS. CIT 282 ITR 178 HAVE HELD THAT AD MISSION MADE DURING THE COURSE OF SEARCH BY WAY OF SWORN S TATEMENT IS AN ADMITTED FACT AND NEED NOT BE PROVED. 2. THE APPELLANT CRAVES LEAVE TO ADD, TO AMEND OR ALTER THE ABOVE GROUNDS OF APPEAL AS MAY BE DEEMED NECESSARY . 2. THE GROUNDS RAISED ARE IDENTICAL FOR ALL THE YEA RS. AT THE TIME OF HEARING, IT WAS FAIRLY AGREED BY BOTH THE SIDES THAT THE ISSUES IN THESE APPEALS WERE SQUARELY COVERED BY THE DECISION OF THE COORDINATED BENCH OF THIS TRIBUNAL IN THE SISTER CONCERNS CASE OF THE ASSESSEE M/S. SUSEE AG ENCIES IN I.T.A. NOS. 1301 TO 1307/MDS/2009 DATED 29.01.2010, WHEREIN THE COORDIN ATED BENCH HAS HELD AS FOLLOWS: 5. AFTER GIVING OUR THOUGHTFUL CONSIDERATION TO T HE FACTS, EVIDENCES AND LEGAL POSITION ON THE ISSUE, WE HAVE CLEARLY NO TED THAT AS PER THE ASSESSMENT, M/S SUSEE AGENCIES, IS A WHOLESALE DEAL ER IN CIGARETTES, ETC., WHICH IS CLEARLY EVIDENT FROM COLUMN NO.10 OF THE HEADING OF ASSESSMENT ORDER. THE STATEMENT WAS NOT RECORDED A S STATED BY THE LD. AR DURING SEARCH, BUT IT WAS RECORDED DURING SURVEY . IN VIEW OF THE HON'BLE MDRAS HIGH COURT DECISION, IT IS SETTLED LE GAL POSITION THAT THE DEPARTMENT IS NOT EMPOWERED TO RECORD SWORN STATEME NT DURING SURVEY. IN ANY CASE, EVEN IF THIS STATEMENT IS CON SIDERED, IT IS NOT OF ANY HELP TO THE CASE OF THE DEPARTMENT BECAUSE IN T HAT CASE, THE ADMISSION IS REGARDING RETAIL SALES AND NOT WHOLESA LE. ADMITTEDLY, THE ASSESSEE IS ENGAGED IN WHOLESALE BUSINESS OF CIGARE TTES ETC. THE ASSESSING OFFICER HAS NOT MENTIONED ANYTHING REGARD ING THE BOOKS OF ACCOUNT. IN ANY CASE, EVEN IF THE ASSESSEE HAD IND ULGED IN RETAIL SALES, FOR WHICH SOME BILLS WERE NOT ISSUED, THE BOOKS OF ACCOUNT OF THE ASSESSEE ARE DULY AUDITED AND THE ASSESSING OFFICER HAS NOT POINTED OUT ANY UNACCOUNTED SALES THEREIN. DURING THE COURS E OF SURVEY, PHYSICAL STOCK OF PRODUCTS AVAILABLE IN THE BUSINES S PREMISES WAS TAKEN BY THE OFFICERS OF THE DEPARTMENT AND NO DISC REPANCY WAS EITHER NOTICED OR POINTED OUT BY THEM WITH RESPECT TO STOC K REGISTER MAINTAINED BY THE ASSESSEE FIRM. THE ASSESSEE FIRM IS ALSO SUBJECTED TO SALES TAX AND THE SALES TAX ASSESSMENT ORDERS WERE EXAMINED BY THE LD. CIT(A) IN WHICH NO DEFICIENCY WAS NOTICED OR PO INTED OUT. THIS FACT HAS NOT BEEN CONTROVERTED BY THE LD. DR DURING THE COURSE OF HEARING. ALL THE PURCHASES WERE FOUND TO BE COVERED BY PURCH ASE BILLS AND ALL I.T.A. NO I.T.A. NO I.T.A. NO I.T.A. NOS SS S. .. . 191 TO 197 191 TO 197 191 TO 197 191 TO 197/MDS/ /MDS/ /MDS/ /MDS/1 11 10 00 0 3 THE SALES WERE FOUND TO BE COVERED BY SALES BILLS B Y THE SALES TAX AUTHORITIES. CONSEQUENTLY, WE ALSO OBSERVE THAT THE ADDITIONS TO THE RETURNED INCOME MADE BY THE ASSESSING OFFICER FOR A LL THESE YEARS, ARE NOT PROPERLY SUPPORTED BY ANY PLAUSIBLE EVIDENCE. W ITHOUT ANY BASIS, NO SUCH ADHOC ADDITION CAN BE MADE. THESE ADDITIONS ARE SIMPLY BASELESS AND DESERVE TO BE DELETED. HENCE, THE LD. CIT(A) HAS CORRECTLY DELETED THEM. WE UPHOLD THE IMPUGNED FIND INGS AND CONFIRM THE IMPUGNED DELETIONS. ACCORDINGLY, WE CANNOT ALLO W THESE APPEALS OF THE REVENUE. 3. IN THE CIRCUMSTANCES, RESPECTFULLY FOLLOWING THE DECISION OF THE COORDINATED BENCH OF THIS TRIBUNAL IN THE CASE OF M /S. SUSEE AGENCIES, THE FINDING OF THE LD. CIT(A) IS CONFIRMED AND THE APPE ALS OF THE REVENUE ARE DISMISSED. 4. IN THE RESULT, ALL THE APPEALS OF THE REVENUE A RE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 09.07.2010. SD/- SD/- (ABRAHAM P. GEORGE) (GEORGE MATHAN) ACCOUNTANT MEMBER JUDICIAL MEMBER CHENNAI, DATED THE 09.07.2010. VM/- COPY TO : APPELLANT/RESPONDENT/CIT(A)- /CIT, /DR