THE DY. CIT-1(1), RAIPUR (CG) V. M/S. RAJESH ENGINEERING & CASTING, RAIPUR (CG)

ITA 2/BIL/2014

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 8962 (ITAT-RAIPUR)
• Duration Of Justice: 3 year(s) 11 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-01-2018
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 27-01-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MRS SHITAL VERMA
• Section: 143(3); 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, RAIPUR BENCH, RAIPUR BEFORE S/SHRI N.S SAINI, ACCOUNTANT MEMBER AND PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA NO.02/RPR/2014 ASSESSMENT YEAR : 2009-2010 DCIT-1(1) , RAIPUR VS. M/S RAJESH ENGINEERING & CASTING, PLOT NO.389-390, URLA INDUSTRIAL ESTATE SECTOR-A, RAIPUR (C.G.) PAN/GIR NO. AACCB7644N (APPELLANT) .. ( RESPONDENT) REVENUE BY : MRS. SHITAL VERMA, DR ASSESSEE BY : NONE DATE OF HEARING : 18/01/ 2018 DATE OF PRONOUNCEMENT : 19 /01/ 2018 O R D E R PER PAVAN KUMAR GADALE, JM THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE OR DER OF THE CIT(A)- RAIPUR, DATED 28.10.2013 FOR THE ASSESSMENT YEAR 2009- 2010. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APP EAL:- 1. WHETHER IN LAW AND ON FACTS & CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS. 40,48,616/- MADE BY THE A.O. ON ACCOUNT OF DIFFERENCE IN INVENTORY OF CLOSING STOCK FOUND AT THE TIME OF SURVEY U/S. 133A.' 2 ITA NO.02/RPR/2014 ASSESSMENT YEAR : 2009-2010 2. 'WHETHER IN LAW AND ON FACTS & CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS. 4,55,752/- MADE BY THE A.O. ON ACCOUNT OF DIFFERENCE IN CASH AND INVESTMENT IN OFFICE BUILDING DISCLOSED AT THE TIME OF S URVEY U/S. 133A.' 3. 'WHETHER IN LAW AND ON FACTS & CIRCUMSTANCES OF THE CASE, DIE CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS. 14,74,848/- MADE BY THE AO ON ACCOUNT OF REMUNERATION TO PARTNERS AS THE SURRENDERED INCOME IS TO BE CONSIDERED AS INCOME FROM OTH ER SOURCES.' 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A PARTNE RSHIP FIRM DERIVING INCOME FROM MANUFACTURING OF HEAVY EARTH MOV ING MACHINERY PARTS. A SURVEY U/S.133A OF THE I.T.ACT, 1961 WAS CONDUCTED AT T HE BUSINESS PREMISES OF THE ASSESSEE ON 30.06.2008 AND 01.07.2008. D URING THE SURVEY, THE ASSESSEED SURRENDERED RS.1,16,06,292/- ON ACCOUNT OF EXCESS STOCK, EXCESS CASH AND UNRECORDED INVESTMENT IN OFFICE BUILDING AN D OFFERED RS.13,00.000/- AFTER MAKING RECONCILIATION IN THE INCOM PLETE BOOKS OF ACCOUNT AND EXPLAINING THE DIFFERENCES. THE ASSESSING OFF ICER ALSO MADE OBSERVATION IN RESPECT OF STATEMENT OF COMPARISON OF THE ASSESSEE, FINANCIAL STATEMENT OF SALE AND NET PROFIT FOR THE YEAR 2007-08 AND 2008-09. CONSIDERING THESE FINDINGS, THE ASSESSING OFFICER CONCLUDED THE PERCENTAGE DISALLOWANCE TO BE MADE IN RESPECT OF STOCK DISCLOSURE AND A LSO DIFFERENCE IN THE CASH AND DISALLOWANCE OF PARTNERS REMUNERATION MAD E U/S 40B AND ALSO BOOKS OF ACCOUNT ARE REJECTED U/S.145(3) OF THE ACT AND CO MPLETED THE 3 ITA NO.02/RPR/2014 ASSESSMENT YEAR : 2009-2010 ASSESSMENT 143(3) R.W S 144 OF THE ACT ASSESSING THE TOTAL IN COME AT RS.90,76,386/- 4. BEING AGGRIEVED BY THE ORDER OF THE ASSESSING OFFICER , THE ASSESSEE CARRIED THE MATTER IN APPEAL. 5. IN THE APPELLATE PROCEEDINGS, THE LD A.R. ARGUED T HE GROUNDS, REITERATED THE SUBMISSIONS MADE BEFORE THE ASSESSING OFFICER ON VARIOUS ADDITIONS. THE CI(A) RELYING ON THE JUDICIAL DECISIONS AND FINDINGS MADE BY THE ASSESSING OFFICER, HAS GRANTED RELIEF AND ALLOWED TH E APPEAL OF THE ASSESSEE. 6. AGGRIEVED BY THE ORDER OF THE CIT(A), THE REVENU E HAS FILED APPEAL BEFORE US. 7. AT THE TIME OF HEARING, LD D.R SUBMITTED THAT THE CIT(A) ERRED IN ALLOWING RELIEF TO THE ASSESSEE IRRESPECTIVE OF THE FACT T HAT THERE IS DIFFERENCE IN VALUATION OF CLOSING STOCK AND EXCESS CASH, WHICH WAS DI SCLOSED AT THE TIME OF SURVEY AND SUBSEQUENT TO THE ASSESSMENT. THE CIT( A) DEALT ON THE VARIOUS ASPECT AND NONE OF THE QUERY OF THE ASSESSING OFF ICER WAS COMPLIED. 8. WE HAVE HEARD LD D.R., PERUSED THE ORDERS OF LOWER AUTHORITIES AND MATERIALS AVAILABLE ON RECORD. PRIMA FACIE, WE FOUND F ROM THE RECORD PRODUCED BEFORE THE TRIBUNAL AND ALSO AS ENUMERATED I N THE ASSESSMENT ORDER THAT THE ASSESSEE HAS NOT COMPLIED ANY NOTICES OF T HE ASSESSING 4 ITA NO.02/RPR/2014 ASSESSMENT YEAR : 2009-2010 OFFICER, THEREFORE, THE ASSESSMENT WAS COMPLETED U/S.144 OF THE ACT. WE FIND THAT THE CIT(A) ERRED IN DELETING THE ADDITION WITHOUT CONSIDERING VARIOUS FACTS AND OVERLOOKING THE ASSESSING OFFICERS FIND INGS AND ALSO RELYING ON THE STATEMENT OF THE ASSESSEE. THE ASSESSING OF FICER WAS DEPRIVED OF VERIFYING THESE FACTS, WHICH WERE PRODUCED BEFORE THE CIT(A). THE CIT(A) DID NOT CALL FOR REMAND REPORT. THEREFOR E, IN THE INTEREST OF JUSTICE, WE REMIT THE MATTER TO THE FILE OF THE ASSESSING OFFICER TO VERIFY THE CLAIM OF THE ASSESSEE. THE ASSESSEE IS DIRECTED TO FURNISH T HE DETAILS WHICH WERE FURNISHED BEFORE THE CIT(A) AND THE AO IS DIRECTE D TO EXAMINE THE DOCUMENTS AND PASS FRESH ORDER AS PER LAW AFTER GIVING O PPORTUNITY OF BEING HEARD TO THE ASSESSEE. 9. IN THE RESULT, APPEAL FILED BY THE REVENUE IS ALLO WED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 19 /01/2018. SD/- SD/- (N.S SAINI) (PAVAN KUMAR GADALE ) ACCOUNTANT MEMBER JUDICIALMEMBER RAIPUR; DATED 19 /01/2018 B.K.PARIDA, SPS 5 ITA NO.02/RPR/2014 ASSESSMENT YEAR : 2009-2010 COPY OF THE ORDER FORWARDED TO : BY ORDER, SR.PRIVATE SECRETARY ITAT, RAIPUR 1. THE APPELLANT : DCIT-1(1) , RAIPUR 2. THE RESPONDENT. M/S RAJESH ENGINEERING & CASTING, PLOT NO.389-390, URLA INDUSTRIAL ESTATE SECTOR-A, RAIPUR (C.G.) 3. THE CIT(A)-RAIPUR 4. PR.CIT-RAIPUR 5. DR, ITAT, RAIPUR 6. GUARD FILE. //TRUE COPY//