M/s Shri Krishna Das Tikaram, V. Income Tax Officer,

ITA 211/JAB/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 5721 (ITAT-JABALPUR)
• Duration Of Justice: 2 year(s) 8 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-04-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 04-04-2016
• Assessment Year: 2000-2001
• Appeal Filed On: 15-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D R LATHORIYA
• Keywords: Depreciation; Assessment record
• Section: 143(3); 133A; 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JABALPUR BENCH, JABALPUR BEFORE SHRI N.S. SAINI , HONBLE ACCOUNTANT MEMBER AND SHRI N.K. CHOUDHRY , HONBLE JUDICIAL MEMBER ITA NO. 2 1 1 / J AB /201 3 (ASST. YEAR : 200 0 - 0 1 ) M/S. SHRI KRISHNA DAS TIKARAM, CIVIL LINES, KATNAI (MP) . V S. ITO, KATNI PAN NO. AAKFS 6379 Q (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI VIJAY GUPTA C A DEPARTMENT BY : S HRI D.R. LATHORIYA - DR DATE OF HEARING : 04 / 0 4 /201 6 . DATE OF PRONOUNCEMENT : 04 / 04 /201 6 . O R D E R PER N.S. SAINI , ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) - 28 , MUMBAI , DATED 2 5 /0 3 /201 3 . 2. IN GROUND NO.1 OF THE APPEAL, THE ASSESSEE HAS CHALLENGED THE REOPENING OF THE ASSESSMENT BY THE ASSESSING OFFICER. 3 . THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE SUBMITTED THAT IT WILL BE SEEN FROM THE REASONS , FOR REOPENING , RECORDED BY THE ASSESSING OFFICER, WHICH IS FILED AT PAGE NOS. 21 TO 23 OF THE PAPER BOOK, NOTICE FOR REOPENING WAS ISSUED ON THE FOLLOWING 10 GROUNDS: - 1) THE ASSESSEE HAS SHOWN INCOME FROM FREIGHT UNDER THE HEAD TRUCK RUNNING ACCOUNT AT RS. 40,434/ - AND DEDUCTED RS. 95,029/ - TOWARDS DIESEL & OTHER EXPENSES. THE ASSESSEE HAS TRIED TO SHOW BUSINESS LOSS OF RS. 54,595/ - TO 2 ITA NO. 2 11 / JAB /201 3 THE TRADING ACCOUNT AND THEREFORE, HE HAS A REASON TO BELIEF THAT THE INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. 2) THE ASSESSEE HAS FURNISHED TDS CERTIFICATES FROM M/S. KATNI MINERALS P. LTD. F OR THE TRANSPORT RECEIPT AT RS. 6,74,043/ - . THE ASSESSEE HAS NOT SHOWN THIS INCOME IN THE RETURN FILED. THEREFORE, THE INCOME HAS ESCAPED ASSESSMENT . 3) THE ASSESSEE RUNS A D HARAMKATA AND HAD SHOWN THE INCOME DURING THIS YEAR AT NIL , WHEREAS THE ASSESSEE HAS SHOWN INCOME FROM DHARMAKATA FOR THE ASSESSMENT YEAR 1998 - 99 AT RS. 9,966/ - AND FOR THE ASSESSMENT YEAR 1999 - 2000 AT RS. 25,350/ - . THEREFORE, INCOME CHARGEABLE TO TAX TO THE EXTENT OF MORE THAN RS. 25,000/ - HAS ESCAPED ASSESSMENT . 4) THE ASSESSEE HAS SHOWN SALES OF MINERALS DURING THE YEAR AT RS. 65,25, 695/ - AND CLAIMED MINING EXPENSES AT RS. 51,20,300 / - AND DECLARED GROSS PROFIT AT RS. 15,46,470/ - WHICH GIVES GROSS PROFIT OF RS. 23.70% AS AGAINST 24.45% DECLARED BY THE ASSESSEE ITSELF DURING THE IMMEDIATELY PRECEDING YEAR AND 37.78% DECLARED IN THE ASSESSMENT YEAR 2001 - 02 . THEREFORE, INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. 5) THE ASSESSEE HAS PAID EMPLOYERS CONTRIBUTION TO THE PROVIDENT FUND AFTER THE DUE DATE AGGREGATING TO RS. 8,305/ - AND THE SAME HAS TO BE DISALLOWED AND ADDED TO THE INCOME OF THE ASSESSEE. 6) THE ASSESSEE HAS PURCHASED TATA HITACHI HYDRAULIC EXCAVATOR FOR RS. 26 LAC ON 31/01/2000 . THE ASSESSEE HAS NOT SHOWN ANY INCOME FROM THIS EXCAVATOR BUT HAS CLAIMED DEPRECIATION AT RS. 3,58,989/ - . SINCE, THE ASSESSEE HAD NOT USED THE MACHINE DURING THE YEAR UNDER CONSIDERATION , THE DEPRECIATION CLAIMED AT RS. 3,58,989/ - HAS TO BE WITHDRAWN A ND THE INCOME HAS ESCAPED ASSESSMENT TO THAT EXTENT. 3 ITA NO. 2 11 / JAB /201 3 7) THE ASSESSEE , IN THE RETURN FILED FOR THE ASSESSMENT YEAR 2000 - 01 , HAS ENCLOSED A LETTER FROM M/S. SHRI KRISHAN DAS TIKARAM & SONS DATED 21/01/2000 ADDRESSED TO THE ASSESSEE INTIMATING THAT THEY WISH TO SELL THEIR TRUCK NO. JVQ - 7 - 21196 & JVQ - 7 - 60277 FOR RS. 2,09,000/ - AND THE AMOUNT MAY BE ADJUSTED AGAINST THEIR OUTSTANDING BALANCE WITH THE ASSESSEE. THE ASSESSEE HAS CLAIMED DEPRECIATION ON THE SUM OF RS. 2,09,000/ - . NO DOCUMENTARY EVIDENCE FOR TRANSFER OF THESE VEHICLES NOT ENCLOSED WITH THE RETURN. NO INCOME FROM THESE TRUCKS HA S BEEN SHOWN BY THE ASSESSEE IN THE RETURN . THEREFORE, THE INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. 8) THE PARTNER SHRI PAWAN GUPTA HAS INTRODUCED CAPITAL DURING THE YEAR FOR RS. 91,594/ - WHICH NEEDS VERIFICATION. THE OTHER PARTNER SHRI O.P. GUPTA HAS ALSO INTRODUCED CAPITAL FOR RS. 1,79,394/ - . THESE ACCRETION TO CAPITAL NEEDS EXAMINATION. 9) DURING THE COURSE OF SURVEY UNDER SEC. 133A CONDUCTED IN THE BUSINESS PREMISES OF THE ASSESSEE ON 13/11/2000 , IT WAS FOUND THAT SOME SELF - MADE VOUCHERS PERTAIN S TO ASSESSMENT YEAR 2000 - 01 , WITHOUT SIGNATURE OF THE RECI PIENTS , WERE AVAILABLE ON THE TABLE OF THE ASSESSEES OFFICE . THE ASSESSEE WHEN QUESTIONED ABOUT THE SAME, HE COULD NOT GIVE ANY ANSWER. IN THESE CIRCUMSTANCES , RS. 7,07,062/ - BEING INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT . 10) DURING THE YEAR, THE ASSESSEE HAS MADE INVESTMENT IN FDRS WITH BANK OF BARODA FOR RS. 7 LAC WHICH NEEDS EXAMINATION. THEREFORE, INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. 4 ITA NO. 2 11 / JAB /201 3 HE SUBMITTED THAT IN THE ASSESSMENT FRAMED UNDER SEC. 143(3)/147 DATED 28/0 3 /2006 , NO ADDITION HAS BEEN MADE BY THE ASSESSING OFFICER ON 09 , OUT OF 10 GROUNDS OF THE REASONS RECORDED FOR REOPENING OF THE ASSESSMENT AND THE ADDITION WAS MADE ONLY ON ACCOUNT OF DISALLOWANCE OF LATE PAYMENT OF EMPLOYERS CONTRIBUTION TO THE PROVIDENT FUND FOR RS. 8,305/ - . HE SUBMITTED THAT IN VIEW OF THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS. M/S. ALOM EXTRUSIONS LIMITED (2009) 319 ITR 306 (SC) WHERE IT HAS BEEN HELD THAT WHERE PAYMENT FOR EMPLOYERS CONTRIBUTION TO PROVIDENT FUND WAS MADE BY THE ASSESSEE BEF O RE DUE DATE FOR FILING OF RETURN UNDER SE C. 139(1) OF THE ACT, THEN NO DISALLOWANCE OF THE SAME WAS TO BE MADE IN COMPUTING THE INCOME OF THE ASSESSEE. HE SUBMITTED THAT IT WILL BE OBSERVED FROM THE ASSESSMENT ORDER , THE PAYMENTS TO THE EMPLOYERS CONTRIBUTION TO THE PROVIDENT FUND WAS MADE BY THE ASSESSEE AS UNDER: - MONTH AMOUNT DUE DATE DATE OF PAYMENT APRIL 1999 RS. 1960/ - 20/05/1999 25/05/1999 JANUARY 2000 RS. 2115/ - 20/02/2000 2202/2000 FEBRUARY 2000 RS. 2115/ - 20/03/2000 25 /03/2000 MARCH 2000 RS. 2115/ - 20/03/2000 17 /03/2000 TOTAL RS. 8305 / - HE SUBMITTED THAT DUE DATE FOR FILING OF RETURN OF INCOME FOR THE ASSESSMENT YEAR 2000 - 01 WAS 30 TH SEP. 2001. A PERUSAL OF THE ABOVE TABLE OF PAYMENTS FOR EMPLOYERS CONTRIBUTION TO PROVIDENT FUND AS RECORDED IN THE ASSESSMENT ORDER SHOWS THAT THE PAYMENTS WERE MADE WELL BEFORE DUE DATE FOR FILING OF RETURN OF INCOME ON 30/09/2001 AND HENCE, I N VIEW OF THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF M/S. ALOM EXTRUSIONS LIMITED (SUPRA) , NO DISALLOWANCE UNDER SEC. 43 - B COULD BE MADE . HE SUBMITTED THAT IN VIEW OF THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF M/S.ALOM EXTRU SIONS LIMITED , THE ADDITION MADE BY THE ASSESSING OFFICER IN AN ORDER FRAMED UNDER SEC. 5 ITA NO. 2 11 / JAB /201 3 143(3) READ WITH SEC. 147 , DATED 28/03/2006 MAKING DISALLOWANCE FOR CONTRIBUTION TO THE EMPLOYERS PROVIDENT FUND , COULD NOT BE SUSTAINED . THUS, ALL THE 10 REASONS RECORDED BY THE ASSESSING OFFICER FOR REOPENING OF THE ASSESSMENT BEING NOT VALID, THE REOPENING OF THE ASSESSMENT WAS BAD IN LAW. 4 . DEPARTMENTAL REPRESENTATIVE COULD NOT CONTROVERT THE ABOVE SUBMISS I ONS OF THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE. 5. AFTER CONSIDERING THE RIVAL SUBMISSIONS AND PERUSING THE MATERIALS AVAILABLE ON RECORD, WE FIND THAT THE ASSESSING OFFICER HAD MADE REOPENING OF THE ASSESSMENT BY ISSUING NOTICE UNDER SEC. 148 OF THE ACT ON 08/03/2004 ON 10 GROUNDS LISTED ABO VE IN THIS ORDER . T HE ASSESSING OFFICER HIMSELF IN THE ORDER FRAMED UNDER SEC. 143(3) READ WITH SEC. 147 ON 28/03/2006 DID NOT MAKE ANY ADDITION ON 09 GROUNDS RECORDED IN THE REASONS FOR REOPENING OF THE ASSESSMENT . AS REGARDS, THE DISALLOWANCE MADE ON THE 10 TH GROUND FOR LATE PAYMENT OF CO NTRIBUTION TO THE EMPLOYERS PROV IDENT FUND, WE FIND THAT IN VIEW OF THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF M/S. ALOM EXTRUSIONS LIMITED (SUPRA), NO DISALLOWANCE UNDER SEC. 43 - B COULD BE MADE, IF THE C ONTRIBUTION TO THE PROVIDENT FUND WAS DEPOSITED BEFORE THE DUE DATE FOR FILING OF THE RETURN OF INCOME UNDER SEC. 139(1) OF THE ACT. WE FIND FROM THE ASSESSMENT ORDER THAT ALL THE CONTRIBUTIONS TO EMPLOYERS CONTRIBUTION TO PROVIDENT FUND WERE DEPOSITED WELL BEFORE THE DUE DATE FOR FILING OF RETURN OF INCOME UNDER SEC. 139(1) OF THE ACT BY THE ASSESSEE FOR THE ASSESSMENT YEAR UNDER CONSIDERATION AND HENCE, NO DISALLOWANCE COULD HAVE BEEN MADE BY THE ASSESSING OFFICER . A S THE ALL REASONS FOR REOPENING OF THE ASSESSMENT RECORDED BY THE ASSESSING OFFICER HAVE BECOME INVALID , T HEREFORE, NOTICE UNDER SEC. 148 OF THE ACT IS INVALID AND ACCORDINGLY RE - ASSESSMENT FRAMED ON 28/03/2006 HAS BECOME BAD IN LAW AND IS ACCORDINGLY CANCELLED . 6 ITA NO. 2 11 / JAB /201 3 6 . IN VIEW OF OUR DECISION IN GROUND NO.1 OF THE APPEAL OF THE ASSESSEE , WHERE WE HAVE CANCELLED THE REASSESSMENT ORDER DATED 28/0 3 /2006 BY THE ASSESSING OFFICER , THE OTHER GROUNDS OF APPEAL TAKEN ON MERITS OF ADDITION HAVE BECOME INFRUCTUOUS AND ACCORDINGLY ARE NOT ADJUDICATED BY US. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE COURT AT THE CLOSE OF THE HEARING ON MONDAY , THE 04 TH DAY OF APRIL , 201 6 AT JABALPUR . S D/ - SD/ - ( N.K. CHOUDHRY ) (N.S.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER D ATED : 04 TH APRIL , 201 6 . VR/ - COPY TO: 1. THE ASSESS E E. 2. THE REVENUE. 3. THE CIT 4. THE CIT(A) 5. THE D.R . 6. GUARD FILE. BY ORDER SR. PRIVATE SECRETARY, ITAT, JABALPUR.