Khambatta Family Trust, Ahmedabad V. The ACIT.,Circle-10, Ahmedabad

ITA 2141/AHD/2007

• Counselvise Citation: 214120514 RSA 2007
• Duration Of Justice: 4 year(s) 8 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 31-01-2012
• Assessment Year: 2003-2004
• Appeal Filed On: 21-05-2007
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J P JANGID
• Assessee Lawyers: PF JAIN
• Keywords: Rejection of books of accounts; Opportunity of being heard
• Section: 143(3)

Judgement Text

-1- IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'A' BEFORE SHRI D K TYAGI - JM AND SHRI A L GEHLOT - AM ITA NO.2141/AHD/2007 (ASSESSMENT YEAR:-2003-04) M/S KHAMBHATTA FAMILY TRUST, B/4, ELLIS-BRIDGE, GYMKHANA, ELLIS-BRIDGE, AHMEDABAD V/S THE ASST. COMMISSIONER OF INCOME-TAX, CIRCLE-10, AHMEDABAD PAN: AAAK 0428 P [APPELLANT] [RESPONDENT] ITA NO.2287/AHD/2007 (ASSESSMENT YEAR:-2003-04) THE DEPUTY COMMISSIONER OF INCOME- TAX, CIRCLE-10, AHMEDABAD V/S M/S KHAMBHATTA FAMILY TRUST, B/4, ELLIS-BRIDGE, GYMKHANA, ELLIS-BRIDGE, AHMEDABAD [APPELLANT] [RESPONDENT] ASSESSEE BY :- SHRI P F JAIN, AR REVENUE BY:- SHRI J P JANGID, SR. DR DATE OF HEARING:- 31-01-2012 DATE OF PRONOUNCEMENT:- 31-01-2012 O R D E R PER D K TYAGI (JM) :- THESE ARE CROSS APPEALS FILED AGAINST THE ORDER OF THE LEARNED CIT(A)-XVI, AHMEDABAD FOR ASSESSMENT YEAR 2003-04. 2 2 THE ASSESSEE HAS RAISED VARIOUS GROUNDS IN ITS AP PEAL. THE FIRST GROUND RAISED BY THE ASSESSEE READS AS UNDER: - 1. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS I N UPHOLDING THE ORDER WITHOUT APPRECIATING THE FACTS THAT DURING CO URSE OF ASSESSMENT HEARINGS, NO DISCUSSION OF VARIOUS ISSUES MENTIONED IN THE ORDER WAS MADE, NO CASE-LAWS CITED AND RELIED UPON IN THE ASS ESSMENT ORDER WERE EVER DISCUSSED AND NO QUERIES FOR WHICH ADDITIONS H AVE BEEN MADE, WERE MADE IN THE COURSE OF HEARING AS DETAILED IN S TATEMENTS OF FACTS. 2 BEFORE THE LEARNED CIT(A), THE ASSESSEE SUBMITTED STATEMENT OF FACTS WHICH ARE AS UNDER:- THE ASSESSEE IS A PRIVATE DISCRETIONARY TRUST ENGA GED-IN MANUFACTURING OF SOFT DRINKS FOR LAST MANY' YEARS W HOSE BOOKS OF ACCOUNTS ARE AUDITED AND VARIOUS RECORDS AS REQUIRE D UNDER VARIOUS ACTS LIKE FACTORY ACT, E.S.I. LAW, P.F. LAW, SALES- TAX ACT ETC. ARE MAINTAINED AND ARE DULY VERIFIED BY THE VARIOUS AUT HORITIES FROM TIME- TO-TIME. THE RETURNS OF THE ASSESSEE IN THE PAST YE ARS HAVE BEEN SCRUTINIZED BY THE INCOME-TAX DEPARTMENT AND VARIOU S ISSUES HAVE BECOME SETTLED AND ATTAINED FINALITY, MORE PARTICUL ARLY THE SYSTEM OF ACCOUNTING. THE SYSTEM OF ACCOUNTING CONSISTENTLY FOLLOWED BY T HE ASSESSEE FOR LAST MANY YEARS, SO TO SAY SINCE INCEPTION WITH REG ARD TO MAINTENANCE OF STOCK RECORDS, AND OTHER RECORDS HAVE BEEN ACCEP TED BY THE DEPARTMENT, FOR CERTAIN YEARS ADDITIONS FOR ALLEGED NON-MAINTENANCE OF RECORDS FOR CONSUMPTION OF RAW MATERIALS WERE MADE IN THE PAST BY REJECTING BOOK RESULT U/S.145 AND THE MATTER ULTIMA TELY REACHED THE TRIBUNAL AND THE ISSUE GOT SETTLED BUT THEN ALSO DI SREGARDING THE ISSUE DECIDED BY THE TRIBUNAL AND ALSO DISREGARDING THE D ECISION OF SUPREME COURT WHICH SAYS THAT OLD AND STALE ISSUES SHOULD N OT BE REACT VITIATED WHICH HAVE ATTAINED FINALITY, THE BOOKS RESULT HAVE BEEN REJECTED ON THE GROUND THAT AS A RESULT OF SURVEY, FRESH FACTS HAVE EMERGED EVEN THOUGH THE FACT IS THAT NO FRESH FACTS HAVE SURFACE D JUSTIFYING ANY DEVIATION FROM THE EARLIER POSITION AND VARIOUS ADD ITIONS HAVE BEEN MADE. 3 AS AGAINST RETURNED INCOME OF RS.54,99,900/- INCOME U/S. 143(3) HAS BEEN DETERMINED AT RS.2,08,69,810/- MAKING HUGE ADD ITIONS ON VARIOUS ISSUES EVEN THOUGH IN RESPONSE TO VARIOUS NOTICES, ALL THE DETAILS AS REQUIRED INCLUDING QUANTITY DETAILS OF GOODS PRODUC ED, RAW MATERIALS CONSUMED AND DETAILS OF EXPENSES HAVE BEEN GIVEN. IT IS ALSO PERTINENT TO POINT OUT THAT DURING COURS E OF HEARINGS, ONLY THE SUBMISSIONS WERE RECEIVED BUT NO DISCUSSION WAS MAD E AND THE ASSESSEE WAS APPRAISED AS TO WHETHER THE ASSESSING OFFICER IS SATISFIED WITH THE DETAILS FURNISHED OR NOT OR ANY FURTHER DE TAILS ARE REQUIRED WHICH IS THE NORMAL PROCEDURE OF HEARING. IN THE AS SESSMENT ORDER, ELABORATE DISCUSSION LIKE AN ARTICLE IN THE BOOK HA S BEEN MADE AND THE TITLE LIKE 'REBUTTAL OF ASSESSES'S SUBMISSION', 'CO NCLUSION', 'REJECTION OF BOOKS OF ACCOUNTS AND ESTIMATION OF PROFIT' HAVE BEEN GIVEN, VARIOUS CASE-LAWS HAVE BEEN CITED AND RELIED UPON W HICH IS PECULIAR BECAUSE SUCH WORDS WERE NEVER DISCUSSED OR HEARD DU RING COURSE OF HEARING AND THAT NO SUCH DISCUSSION OR REVEALING OR CONFRONTING THESE FINDINGS, DECISIONS TO THE ASSESSEE WERE EVER MADE, THEREBY THE ASSESSMENT ORDER BECOMES ERRONEOUS FACTUALLY AND LE GALLY AND NOT KEEPING WITH THE ACTUAL HEARING MADE. 3 AGGRIEVED BY THE ORDER OF THE LEARNED CIT(A), THE ASSESSEE IS IN APPEAL BEFORE US. AT THE TIME OF HEARING, THE LEARNED COUNSEL OF THE ASSESSEE SUBMITTED THAT THE AO HAS PASSED TH E ORDER WITHOUT GIVING PROPER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE, AS HE TOOK THE ASSESSMENT PROCEEDINGS AT THE FAG EN D OF THE YEAR WHEN THE CASE WAS GETTING TIME-BARRED. HE ACCORDING LY PRAYED THAT IN THE INTEREST OF JUSTICE AND FAIR PLAY, THE MATTER MAY BE RESTORED TO THE FILE OF THE AO FOR RE-ADJUDICATION. 4 THE LEARNED DR DID NOT OBJECT TO THIS SUBMISSION MADE BY THE LEARNED COUNSEL OF THE ASSESSEE. 5 HAVING HEARD BOTH THE PARTIES, WE RESTORE THE MAT TER BACK TO THE FILE OF THE AO FOR FRESH ADJUDICATION. SINCE TH E ISSUES 4 INVOLVED IN THE ASSESSEES APPEAL ARE RESTORED BACK TO THE FILE OF THE AO, THE REVENUES APPEAL FOR THE YEAR UNDER CON SIDERATION ALSO STANDS RESTORED. 6 IN THE RESULT, BOTH THE APPEALS ARE ALLOWED FOR S TATISTICAL PURPOSE. ORDER PRONOUNCED IN THE COURT TODAY ON 31-01-2012 SD/- SD/- (A L GEHLOT) ACCOUNTANT MEMBER (D K TYAGI) JUDICIAL MEMBER DATE : 31-01-2012 COPY OF THE ORDER FORWARDED TO: 1. M/S KHAMBHATTA FAMILY TRUST, B/4, ELLIS-BRIDGE, GYMKHANA, ELLIS-BRIDGE, AHMEDABAD 2. THE ASST. COMMISSIONER OF INCOME-TAX, CIRCLE-10, AHMEDABAD 3. CIT CONCERNED 4. CIT(A)-XVI, AHMEDABAD 5. DR, ITAT, AHMEDABAD BENCH-A, AHMEDABAD 6. GUARD FILE BY ORDER DEPUTY REGISTRAR ASSISTANT REGISTRAR ITAT, AHMEDABAD