Shri Brijkishore Gupta, Vidisha V. The ITO, Vidisha

ITA 207/IND/2014

• Counselvise Citation: 20722714 RSA 2014
• Duration Of Justice: 1 year(s) 7 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-10-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 12-03-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Assessee Lawyers: RAGHAVJI

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE (SINGLE MEMBER CASE) BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER I.T.A.NO. 207/IND/2014 A.Y.: 2008-09 SHRI BRIJKISHORE GUPTA, ITO, PROP.OM TRADERS, VS. VIDISHA GANJ BASODA, DISTRICT VIDISHA APPELLANT RESPONDENT PAN NO :AFMPG6649H APPELLANT BY : SHRI RAGHAVJI, ADV. RESPONDENT BY : SHRI R. A. VERMA, DR DATE OF HEARING : 13 . 10 .2015 . DATE OF PRONOUNCEMENT : 13 . 10 .2015 SHRI BRIJKISHORE GUPTA, GANJ BASODA, DISTT. VIDISHA VS. ITO, I.T.A.NO. 207/IND/2014 A.Y.2008-09 2 2 O R D E R THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF CIT(A)-II, BHOPAL, DATED 28.11.2013 FOR THE ASSE SSMENT YEAR 2008-09. 2. GROUND NO.1 IS OF GENERAL NATURE AND DOES NOT REQUI RE ANY ADJUDICATION. 3. GROUND NO.2 READS AS UNDER :- THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, LD. CIT(A)-II, BHOPAL, ERRED AND W AS NOT JUSTIFIED IN HOLDING AN ADDITION OF RS. 1,07,290/- ON ACCOUNT OF AMOUNT PAYABLE AS LIABILITY, THEREFORE, THE ADDITION MADE BE KINDLY DELETED. 4. IT WAS OBSERVED FROM THE BALANCE SHEET UNDER THE HE AD SUNDRY CREDITORS AMOUNT OF RS. 1,07,290/- PAYABL E TO M/S. TRIVENI CANVASSERS, JABALPUR. ON SCRUTINY OF THE EA RLIER YEARS BALANCE SHEET SHOWED THE SAME AMOUNT PAYABLE. THE A SSESSEE WAS ASKED WHY THE AMOUNT WAS NOT PAID SO, FAR AND W HY THE SAME MAY NOT BE ADDED U/S 41 AS CESSATION OF LIABIL ITY. THE ASSESSEE CONTENDED THAT THE AMOUNT IN QUESTION IS I N DISPUTE IN THE COURT OF LAW BUT DID NOT PRODUCE ANY PROOF R EGARDING SHRI BRIJKISHORE GUPTA, GANJ BASODA, DISTT. VIDISHA VS. ITO, I.T.A.NO. 207/IND/2014 A.Y.2008-09 3 3 DISPUTE REGARDING LITIGATION. THEREFORE, IT WAS ADD ED U/S 41 OF THE INCOME-TAX ACT, 1961. 5. THE MATTER CARRIED TO THE LD. CIT(A) AND THE LD. CI T(A) HAS CONFIRMED THE SAME. 6. I HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PART IES. LOOKING TO THE FACTS AND CIRCUMSTANCES OF THE CASE, I FIND THAT THE ASSESSEE HAS SOLD WHEAT TO AMBIKA CORPORATION, BARODA, AMOUNTING TO RS. 3,14,300/-. FROM THE ABOVE, THE AS SESSEE HAS PAID RS. 14,300/- IN CASH IN THE YEAR 2001 AND BALANCE RS. 3,00,000/- WERE GIVEN BY CHEQUES AMOUNTING TO R S. 50,000/- ON DIFFERENT DATES. CHEQUES WERE BOUNCED AND RETURNED BACK TO THE ASSESSEE. THE ASSESSEE HAS ISS UED A LEGAL NOTICE TO THE PURCHASER. THE ASSESSEE HAS FILED THE COMPLAINT WITH BASODA POLICE THANA. MOREOVER THE ASSESSEE HAS ALSO FILED SUIT AGAINST DEFAULTER BEFORE FIRST CLASS MAG ISTRATE, CIVIL COURT, GANJ BASODA. THE COURTS NOTICE COULD NOT BE SERVED. IN THE MEANTIME, THE ASSESSEE HAS PRESSED HARD TO THE DALAL TO ARRANGE THE PAYMENT OF RS. 3 LACS. THE DALAL HAD MA DE THE PAYMENT OF ONE THIRD AMOUNT TO, THE ASSESSEE AND HE HAS SHRI BRIJKISHORE GUPTA, GANJ BASODA, DISTT. VIDISHA VS. ITO, I.T.A.NO. 207/IND/2014 A.Y.2008-09 4 4 DEPOSITED RS. 1 LAC IN THE ACCOUNT OF TRIVENI CANVA SSERS, JABALPUR. SIMILARLY, THE AMOUNT OF RS. 3 LACS WAS S HOWN AS DEBIT OF M/S. AMBIKA TRADING CORPORATION OF BASODA , IN THE BALANCE SHEET. THE ASSESSEE HAS DEPOSITED AMOUNT OF RS. 1 LAC WITH THE CONDITION THAT IF THE ASSESSEE RECOVERS RS . 3 LACS FROM AMBIKA TRADING CORPORATION, BARODA, RS. 1 LAC RECEI VED FROM TRIVENI CANVASSERS HAS TO BE RETURNED TO THE ASSESS EE. THE ASSESSEE HAD LIABILITY OF RS. 1,07,290/- AT ONE TIM E, BUT THIS LIABILITY IS SUBJECT TO OUTCOME OF THE RESULT. THER EFORE, THIS IS NOT A TRADING LIABILITY. MOREOVER, THE ASSESSEE HAS PRODUCED THE DOCUMENTARY EVIDENCE TO SHOW THAT THE MATTER IS SUB- JUDICE. PAGE 31 TO 32 OF THE PAPER BOOK IS CHARGE S HEET FILED BY THE POLICE AND, THEREFORE, THE ASSESSEE COULD NOT R ECOVER THIS AMOUNT. SIMILARLY, THE MATTER IS ALSO PENDING BEFOR E CIVIL COURT, BASODA I.E ON PAGE NO. 33. FROM THIS, IT CAN BE SEEN THAT THE ASSESSEE COULD NOT RECOVER THIS AMOUNT AND IT IS SHOWN THAT THIS OUTSTANDING IS IN THE NAME OF THE P URCHASER. I FIND THAT AS PER SECTION 41(1) OF THE ACT, THE ASSE SSEE HAS NOT RECEIVED ANY REMISSION AND CESSATION OF LIABILITY. THE ASSESSEE SHRI BRIJKISHORE GUPTA, GANJ BASODA, DISTT. VIDISHA VS. ITO, I.T.A.NO. 207/IND/2014 A.Y.2008-09 5 5 HAS NOT RECEIVED ANY BENEFIT OF SUCH LIABILITY BY W AY OF REMISSION OR CESSATION THEREOF. THEREFORE, IN THIS CASE, THE ASSESSEE HAS NOT RECEIVED ANY REMISSION OR CESSATIO N OF LIABILITY. THE REMISSION AND CESSATION OF LIABILITY IS ABSENT IN ASSESSEES CASE. THE ASSESSEE HAS RECEIVED RS. 1,07 ,290/- THAT IS ON CONDITION. THEREFORE, THE PROVISIONS OF SECTI ON 41(1) IS NOT APPLICABLE TO THE LIABILITY OF RS. 1,07,290/-. THEREFORE, I DELETE THE SAME. GROUND NO. 2 IS ALLOWED 7. GROUND NO. 3 READS AS UNDER :- THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, LD. CIT(A) II, BHOPAL, ERRED AND WAS NOT JUSTIFIED IN HOLDING AN ADDITION OF RS. 29,726.00 ON THE GROUND OF DIFFERENCE IN NET COMMISSION AMOUNT CREDITED IN PROFIT AND LOSS ACCOUNT AND GROSS COMMISSION SHOWN IN TDS CERTIFICATE, THEREFORE, THE ADDITION MADE BE KINDLY DELETED. 8. THE ASSESSEE DERIVES INCOME FROM TRADING OF GRAINS AND COMMISSION ON BROKERAGE. DURING THE COURSE OF S CRUTINY, IT WAS OBSERVED THAT THE ASSESSEE HAS CREDITED AN A MOUNT OF RS. 3,63,352/- AS RECEIPT FROM COMMISSION/BROKERAG E TO THE PROFIT AND LOSS ACCOUNT. ON VERIFICATION OF TDS CER TIFICATE ATTACHED TO THE RETURN FILED BY THE ASSESSEE, IT IS OBSERVED THAT SHRI BRIJKISHORE GUPTA, GANJ BASODA, DISTT. VIDISHA VS. ITO, I.T.A.NO. 207/IND/2014 A.Y.2008-09 6 6 THE ASSESSEE HAS RECEIVED AN AMOUNT OF RS. 3,90,021 /- AND RS. 3357/- TOTALING TO RS. 3,93,378/- FROM M/S. AGR O SOLVENTS PRODUCTS PRIVATE LIMITED, GWALIOR AND M/S. KRISHNA OIL EXTRACTION LIMITED, RAIPUR. THE ASSESSEE WAS ASKED TO EXPLAIN THE DIFFERENCE OF RS. 29,726/- LESS CREDITED TO PRO FIT AND LOSS ACCOUNT. THE ASSESSEE CONTENDED THAT THE DIFFERENCE AMOUNT WAS RECEIVED IN EARLIER YEARS AND OFFERED FOR TAXAT ION. THE AO HAS VERIFIED THE AUDITED REPORT OF 2006-07 AND HE D ID NOT FIND ANY AMOUNT CREDITED TO PROFIT AND LOSS ACCOUNT AND THE ASSESSEE COULD NOT PRODUCE ANY EVIDENCE. IN VIEW OF THIS THE AMOUNT OF RS. 29,726/- WAS ADDED TO THE INCOME OF T HE ASSESSEE. 9. THE LD. AUTHORIZED REPRESENTATIVE DURING THE COURSE OF HEARING SUBMITTED THAT THE ASSESSEE HAS EARNED COMM ISSION FROM M/S. AGRO SOLVENTS PRODUCTS PRIVATE LIMITED AN D CREDITED THE SAME IN THE YEAR AND THE TOTAL AMOUNT OF RS. 10 ,043/- WAS CREDITED TO THE LEDGER ACCOUNT OF M/S. AGRO SOLVENT S PRODUCTS PRIVATE LIMITED AND THIS AMOUNT IS REFLECTED IN AUD IT REPORT FOR FINANCIAL YEAR 2006-07. SIMILARLY, M/S. AGRO SOLVEN TS PRODUCTS SHRI BRIJKISHORE GUPTA, GANJ BASODA, DISTT. VIDISHA VS. ITO, I.T.A.NO. 207/IND/2014 A.Y.2008-09 7 7 PRIVATE LIMITED HAS ALSO ESTIMATED THE TDS AMOUNT F ROM THIS COMMISSION AND THE AMOUNT WAS DULY CREDITED IN COMM ISSION ACCOUNT. THE COPY OF THE COMMISSION ACCOUNT IS ENCL OSED. SIMILARLY, THE ASSESSEE HAS ALSO SHOWN THE NET INCO ME OF RS. 3,63,652/- IN PROFIT AND LOSS ACCOUNT OF THE ASSESS EE. SIMILARLY, THE ASSESSEE HAS EARNED THE COMMISSION O F RS. 3357/- WHICH IS ALSO CREDITED AND REFLECTED AND CO PY IS ALSO ENCLOSED. SIMILARLY, THE AMOUNT OF RS. 4191/- IS AL SO CREDITED. THUS, ALL THE EVIDENCES WERE SUBMITTED. 10. THE LD. AUTHORIZED REPRESENTATIVE SUBMITTED THAT TH E ASSESSEE IS HAVING ALL THESE DOCUMENTARY EVIDENCES. THEREFORE, AFTER VERIFYING THE DOCUMENTS, THE CLAIM OF THE ASS ESSEE MAY BE ALLOWED. 11. ON THE OTHER HAND, THE LD. DR REQUESTED FOR RESTORATION OF THIS APPEAL TO THE FILE OF AO. 12. I HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PART IES. THE ASSESSEE HAS SUBMITTED ALL THESE DOCUMENTARY EV IDENCES BEFORE ME AND ALL THE COMMISSION IS ALSO CREDITED I N SOYABEAN ACCOUNT, M/S. KRISHNA OIL EXTRACTION LIMITED, RAIP UR AND SHRI BRIJKISHORE GUPTA, GANJ BASODA, DISTT. VIDISHA VS. ITO, I.T.A.NO. 207/IND/2014 A.Y.2008-09 8 8 COMMISSION RECEIVED FROM M/S. AGRO SOLVENTS PRODUCT S PRIVATE LIMITED, GWALIOR. THEREFORE, I DIRECT THE AO TO VER IFY ALL THESE DOCUMENTARY EVIDENCES AND DECIDE THE MATTER AFRESH AS PER LAW. GROUND NO.3 IS ALLOWED FOR STATISTICAL PURPOSE S. 13. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 13 TH OCTOBER, 2015. SD/- ( D.T.GARASIA) JUDICIAL MEMBER DATED : 13 TH OCTOBER, 2015. CPU* 13