ADITYA BIRLA RETAIL LTD., MUMBAI V. DCIT - 9(1)(1), MUMBAI

ITA 2142/MUM/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 0145 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-08-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2008-2009
• Appeal Filed On: 01-04-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH E, MU MBAI BEFORE SH. P.K. BANSAL VICE PRESIDENT AND SHRI PAWAN SINGH, JUDICIAL MEMBER ITA NO. 2142/MUM/2016 (ASSESSMENT YEAR- 2008-09) ADITYA BIRLA RETAIL LTD. (SUCCESSOR OF M/S. TRINETHRA SUPER RETAIL PVT. LTD.) 86/92 SKYLINE ICON, 5 TH FLOOR, NEAR MITTAL INDUSTRIAL ESTATE, ANDHERI (E), MUMBAI -400059 PAN: AAACP2678Q VS. DCIT -9 (1)(1 ), 2 ND FLOOR, AAYAKAR BHAVAN, M.K. ROAD,MUMBAI-400020. (APPELLANT) (RESPONDENT) ASSESSEE REPRESENTED BY : SH. RONOK G. DOSHI (AR ) REVENUE REPRESENTED BY : SH. RAM TIWARI (SR DR) DATE OF HEARING : 01.08.2017 DATE OF ORDER : 29.08.2017 ORDER UNDER SECTION 254(1) OF INCOME-TAX ACT PER PAWAN SINGH JUDICIAL MEMBER ; 1. THIS APPEAL BY ASSESSEE UNDER SECTION 253 OF INCOME -TAX ACT (ACT) IS DIRECTED AGAINST THE ORDER OF LD. COMMISSIONER (APP EALS)-2, HYDERABAD DATED 23.02.2015 FOR ASSESSMENT YEAR 2008- 09. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE LEARNED COMMISSIONER OF INCOME TAX APPEALS - 2, HYDERABAD ( 'CIT(A)') ERRED IN UPHOLDING THE ORDER OF THE INCOME-TAX OFFICER, WARD 2(2), HYDERABAD ('THE AO') IN MAKING AN ADDITION TO TOTAL INCOME ON ACCOU NT OF PURCHASES ALLEGED GROUND THAT NO EVIDENCE WAS PRODUCED TO JUSTIFY THE GENUINENESS OF PURCHASES. 2. THE APPELLANT THEREFORE PRAYS THAT THE AFORESAID ADDITION BE DELETED. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE-C OMPANY IS DERIVING ITS INCOME FROM THE BUSINESS OF SUPER MARKET, FILED ITS RETURN OF INCOME FOR ITA NO.2142/M/ 2016 ADITYA BIRLA RETAIL LTD. 2 RELEVANT AY ON 29.09.2008 DECLARING TOTAL LOSS OF R S. 109,86,58,856/-. THE ASSESSMENT WAS COMPLETED U/S 143(3) ON 29.12.20 10. THE ASSESSING OFFICER (AO) WHILE FRAMING THE ASSESSMENT ORDER BES IDES THE OTHER ADDITION RS. 36,56,156/- BY DISALLOWING THE PURCHA SES. ON APPEAL BEFORE THE LD. CIT(A), THE ACTION OF AO WAS CONFIRMED. THU S, FURTHER AGGRIEVED BY THE ORDER OF LD. CIT(A), THIS APPEAL IS FILED BE FORE US. 3. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVE (AR ) OF ASSESSEE AND LD. DEPARTMENTAL REPRESENTATIVE (DR) FOR THE REVENUE AN D PERUSED THE MATERIAL AVAILABLE ON RECORD. THE LD. AR OF THE ASS ESSEE ARGUED THAT DURING THE ASSESSMENT PROCEEDING, THE ASSESSEE WAS ASKED TO PRODUCE SOME SELECTED VOUCHERS FOR VERIFICATION ON TEST CHE CK BASIS. THE VOUCHERS WERE VERIFIED ON THE TEST CHECK BASIS, THE AO MADE THE DISALLOWANCE OF RS. 36,56,165/- THAT ON THE GROUND THAT PURCHASE BILLS WERE NOT FURNISHED. THE ASSESSEE HAS FURNISHED AND THE VOUCHERS AVAILABLE WITH THE ASSESSEE. THE BUSINESS OPERATIONS OF THE A SSESSEE IS SPREAD ACROSS FOUR STATES I.E. ANDHRA PRADESH, KARNATAKA, TAMIL N ADU AND KERALA, THE BILLS COULD NOT BE PRODUCED DUE TO THE PAUCITY OF T IME, ALL THE PURCHASES OF ASSESSEE WERE GENUINE AND THE DISALLOWANCE CANNOT B E MADE HOLDING THAT ASSESSEE COULD NOT PRODUCE THE VOUCHER. ON THE OTHE R HAND, THE LD. DR FOR THE REVENUE SUPPORTED THE ORDER OF AUTHORITIES BELO W. THE LD. DR FOR THE REVENUE FURTHER ARGUED THAT THE ASSESSEE DESPITE GI VING SUFFICIENT ITA NO.2142/M/ 2016 ADITYA BIRLA RETAIL LTD. 3 OPPORTUNITY FAILED TO PRODUCE THE BILLS EITHER BEFO RE THE AO OR BEFORE THE LD. CIT(A). 4. WE HAVE CONSIDERED THE RIVAL SUBMISSION OF THE PART IES AND HAVE GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. WE HAVE SE EN THAT DURING THE ASSESSMENT PROCEEDING, THE AO ASKED THE ASSESSEE TO PRODUCE SOME SELECTED VOUCHERS RELATING TO PURCHASES, FOR VERIFI CATION ON TEST CHECK BASIS, THE ASSESSEE WAS UNABLE TO PRODUCE ANY KIND OF EVIDENCE FOR BILL AMOUNTING TO RS. 1,22,84,815/-. THE ASSESSEE WAS AG AIN ASKED VIDE NOTICE DATED 27.12.2010 AS TO WHY THE ADDITION BE NOT MADE TO THE TOTAL INCOME OF ASSESSEE. IN REPLY TO THE NOTICE VIDE REPLY DATED 29.12.2010 SUBMITTED THAT EXCEPT THE PURCHASE BILLS OF RS.36,56,165/-. THE BILL COULD NOT AS THE BE PRODUC ED AS THE BUSINESS OPERATION OF THE ASSESSEE ARE SPREAD OVER FOUR STAT E CONSISTING OF ANDHRA PRADESH, KARNATAKA, TAMIL NADU AND KERALA. THE CONT ENTION OF ASSESSEE WAS NOT ACCEPTED BY AO AND THE PURCHASES OF RS. 36, 56,165/- WAS DISALLOWED. BEFORE THE LD. CIT(A), THE SIMILAR CONT ENTION WAS RAISED THAT BUSINESS OPERATION OF THE ASSESSEE ARE SPREAD OVER FOUR STATE CONSISTING OF ANDHRA PRADESH, KARNATAKA, TAMIL NADU AND KERALA AN D THE BILLING WAS OUTSOURCED AND PURCHASE BILL COULD NOT BE FILED. TH E LD. CIT (A) CONFIRMED THE ACTION OF THE AO HOLDING IT AS JUSTIF IABLE. 5. WE HAVE SEEN THAT DURING THE RELEVANT FINANCIAL YEA R/ ASSESSMENT PERIOD THE ASSESSEE HAS THE ASSESSEE SHOWN THE PURCHASES OF RS.5,42,00,712/-. ITA NO.2142/M/ 2016 ADITYA BIRLA RETAIL LTD. 4 THE ASSESSEE COULD NOT PRODUCED THE BILLS RELATED THE PURCHASE OF RS. 36,56,165/- ONLY. THE ASSESSEE CONTENDED THAT THEY COULD NOT FURNISHED THE BILLS DUE TO SHORTAGE OF THE TIME AS THE BUSINE SS OF THE ASSESSEE IS SPREAD OVER IN FOUR STATES I.E. ANDHRA PRADESH, TAM ILNAIDU, KARNATAKA AND KERALA AND THE ASSESSEE WAS NOT GIVEN SUFFICIENT TI ME TO COLLECT THE RELEVANT BILLS TO RECONCILE THE PURCHASES. THE ASSE SSEE FILED DOCUMENTARY EVIDENCES FOR 95% OF THE BILLS. THE AO OFFICER NOT DISPUTED THE GENUINITY OF THE PURCHASES. THE DISALLOWANCE WAS MADE BY ASSE SSING OFFICER ONLY ON THE BASIS OF FAIR ADMISSION ON BEHALF OF ASSESSEE. THE ASSESSING OFFICER HAS NOT GIVEN ANY FINDING THE ASSESSEE HAS SHOWN PU RCHASES TO INFLATE THE GROSS OR NET PROFIT. WE MAY FURTHER NOTE THAT THE A SSESSEE HAS FILED THE RETURN OF INCOME BY DECLARING THE LOSS OF RS. 110 C RORE (APROX). IN OUR VIEW THE ADDITIONS WERE MADE ONLY ON THE FAIR ADMIS SION OF THE ASSESSEE THAT THE BILLS RELATED FOR AN AMOUNT OF RS. 36,56,1 65/-. THE ASSESSEE FAIRLY CONCEDED THAT THEY COULD NOT BE FURNISHED THE BILLS FOR SUCH PURCHASES, FOR THE REASONS THAT THE BUSINESS OF THE ASSESSEE WAS S PREAD IN FOUR STATES. CONSIDERING THE PECULIARITY OF THE FACTS, WE MAY CO NCLUDE THAT THERE IS NO DELIBERATE ACT ON THE PART OF ASSESSEE TO EVADE THE EVIDENCE OR TO INFLATE THE PROFIT. AS WE HAVE ALREADY OBSERVED THAT THE AS SESSEE HAS SHOWN THE NEGATIVE INCOME. THUS, THE ASSESSEE WOULD NOT BE BE NEFITED BY CONCEALING SUCH BILLS. IN OUR CONSIDERED OPINION THE DISALLOWA NCE ON THE FAIR ADMISSION BY ASSESSEE ON THE FACTS OF THE PRESENT C ASE IS NOT JUSTIFIABLE. IN ITA NO.2142/M/ 2016 ADITYA BIRLA RETAIL LTD. 5 OUR VIEW THE ASSESSEE IS NOT REQUIRE TO PROVE THE T HINGS BEYOND THE REASONABLE DOUBT UNDER THE INCOME TAX PROCEEDINGS. THE ASSESSEE HAS SUFFICIENTLY EXPLAINED THE FACTS ABOUT NOT FURNISHI NG THE CERTAIN BILLS BEFORE THE LOWER AUTHORITIES. CONSIDERING THE RATIO / QUANTITY OF THE BILLS, COMPARATIVE TO THE TOTAL PURCHASE THE EXPLANATION O F THE ASSESSEE IS PLAUSIBLE ONE. HENCE, THE DISALLOWANCE OF RS. 36,56 ,165/- IS NOT JUSTIFIABLE AND THE SAME IS DELETED. THUS, THE GROU ND OF APPEAL RAISED BY ASSESSEE IS ALLOWED. 6. IN THE RESULT APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 29 TH DAY OF AUGUST 2017. SD/- SD/- ( P.K. BANSAL) (PAWAN SINGH) VICE-PRESIDENT JUDICIAL MEMBER MUMBAI; DATED 29/08/2017 S.K.PS COPY OF THE ORDER FORWARDED TO : BY ORDER, ( ASSTT.REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY/