M/S Sunny Construction & Co. , Koderma V. ACIT,Circle 1(1), Hazaribagh

ITA 196/RAN/2018

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 8591 (ITAT-RANCHI)
• Duration Of Justice: 2 year(s) 1 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-07-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 15-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K MOHANTI CITSRDR
• Assessee Lawyers: D C AGARWAL
• Keywords: Revenue expenditure
• Section: 143(3); 201; 147; 148; 37

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RANCHI BENCH E COURT AT KOLKATA BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND DR. A.L. SAINI, ACCOUNTANT MEMBER ITA NO. 1 9 6 / RAN / 201 8 ASSESSMENT YEAR :2010-11 M/S SUNNY CONSTRUCTION & CO. JHUMRITELAIYA, KODERMA-825 409 [ PAN NO.ABKFS 0076 P ] V/S . ACIT, CIRCLE-1(1), AAYKAR BHAWAN, HAZARIBAG-825301 /APPELLANT .. / RESPONDENT /BY APPELLANT SHRI D.C. AGARWAL, A.R /BY RESPONDENT SHRI A.K. MOHANTI, ADDL. CIT-SR-DR /DATE OF HEARING 15-07-2020 /DATE OF PRONOUNCEMENT 15 -07-2020 / O R D E R PER BENCH (ORAL):- THIS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2010-11 ARISES AGAINST THE COMMISSIONER OF INCOME TAX (APPEALS)-HAZARIBAGHS O RDER DATED 09.05.2018 PASSED IN CASE NO.10028/HZB/2017-18, INVOLVING PROC EEDINGS U/S 147 R.W.S. 143(3) THE INCOME TAX ACT, 1961; IN SHORT THE ACT . HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. IT TRANSPIRES AT THE OUTSET THAT THE ASSESSING O FFICER HAD INITIATED SECTION 148 R.W.S. 147 PROCEEDINGS AGAINST THE ASSESSEE AS PER THE NOTICE DATED 24.03.2017 AFTER RECORDING THE FOLLOWING REASONS:- IT HAS BEEN OBSERVED THAT THE ASSESSEE HAS DEBITED RS.14,72,991/- IN THE P/L ACCOUNT UNDER THE SUB-HEAD REVENUE . IT IS QUITE EVIDENT FROM THE RECORD THAT THE EXPENDITURE MADE UNDER THIS SUB-HEAD IS NOT REVENUE EXPENDITURE AND HENCE BOOKS OF ACCOUNT ARE REQUIRED TO BE EXAMINED. IT IS A SOR T OF RECOVERY AGAINST REVENUE ( I.E. ITA NO196/RAN/2018 A.Y. 2010-11 M/S SUNNY CONSTRUCTION & CO. VS. ACIT, CIR- 1(1), HZB PAGE 2 AGAINST NON-REFUND OF ASSETS SUCH AS EMPTY BITUMEN DRAM, EMPTY CEMENT BAGS ETC.) . HENCE, THE EXPENSES CLAIMED UNDER ABOVE MENTIONED SUB-HEAD ARE NOT ALLOWABLE UNDER THE PROVISION OF SECTION 37 OF THE I.T. ACT, 1961. HENCE, ATTRACTS ESCAPEMENT AND IT SHOULD BE ADDED BACK TO THE TOTAL INCOME OF THE ASSESSEE. THEREFORE, I HAVE REASONS TO BELIEVE THAT AN AMOUNT OF RS.14,72,991/- IS ESCAPED INCOME FOR WHICH ACTION AS PER 147/148 IS TO BE INI TIATED. 3. LEARNED DEPARTMENTAL REPRESENTATIVE FAILS TO REB UT THE CLINCHING FACT THAT WE ARE IN ASSESSMENT YEAR 2010-11 WHEREAS THE IMPUG NED PROCEEDINGS HAVE BEEN SET INTO MOTION WELL BEYOND THE PERIOD OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. AND THAT TOO WITHOUT RECO RDING ANY FAILURE ON PART OF THE ASSESSEE TO FULLY AND TRULY DISCLOSED THE RELEV ANT PARTICULARS. IT RATHER TRANSPIRES THAT THE ASSESSING OFFICERS RE-OPENING REASONS HAVE GONE BY THE ASSESSEES PROFIT AND LOSS ACCOUNT AND BOOKS OF ACC OUNT ALREADY ON RECORDED ONLY. WE THEREFORE INVOKE SEC. 147 FIRST PROVISO IN THE GIVEN FACTS OF THE CASE AND QUASH THE IMPUGNED RE-OPENING FOR THIS REASON A LONE. ALL OTHER PLEADINGS ON MERITS ARE RENDERED INFRUCT UOUS. 4. THIS ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT AT THE CLOSE OF HEAR ING ON WEDNESDAY, 15 TH JULY, 2020 SD/- SD/- ( ') ($% ') (DR. A.L. SAINI) (S.S.GODARA) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) *DKP SR.P.S. &- 15 / 07/ 20 20 / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-M/S SUNNY CONSTRUCTION & CO. JHUMRIITELA IYA, KODERMA-825301 2. /RESPONDENT-ACIT, CIR-1(1), AAYKAR BHAWAN, HAZARIBA G-825301 3. 0 3 / CONCERNED CIT RANCHI 4. 3- / CIT (A) RANCHI 5. 6 %%0, 0, / DR, ITAT, RANCHI 6. < / GUARD FILE. BY ORDER/ , /TRUE COPY/ 0,