ITO, New Delhi V. Sh. Raj Kumar Maheshwari, New Delhi

ITA 216/DEL/2012

• Counselvise Citation: 21620114 RSA 2012
• Duration Of Justice: 2 year(s) 1 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-03-2014
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 10-02-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 13-01-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: RAKESH CHADHA
• Keywords: Bogus purchase; Business income

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: F NEW DELHI BEFORE SMT DIVA SINGH, JUDICIAL MEMBER AND SHRI T.S.KAPOOR, ACCOUNTANT MEMBER I.T.A .NO.-216/DEL/2012 (ASSESSMENT YEAR-2008-09) ITO, WARD-19(4), ROOM NO- D-217, VIKAS BHAWAN, NEW DELHI (APPELLANT) VS SH.RAJ KUMAR MAHESHWARI, A-51, WAZIRPUR INDL. AREA, DELHI-110052. PAN-AAGPM2580F (RESPONDENT) APPELLANT BY: MS. MEENAKSHI VOHRA, SR. DR RESPONDENT BY: SH. RAKESH CHADHA, CA ORDER PER DIVA SINGH, JM IN THE PRESENT APPEAL FILED BY THE REVENUE AGAINS T THE ORDER DATED 25.10.2011 OF CIT(A)-XXII, NEW DELHI PERTAINING TO 2008-09 AS SESSMENT YEAR FOLLOWING GROUNDS HAVE BEEN RAISED FOR OUR ADJUDICATION:- 1. THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITI ON OF RS.12,27,727/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF BOGUS PURCHASES . 2. THE LD. CIT(A) HAS ERRED IN ACCEPTING THE ADDITI ONAL EVIDENCE SUBMITTED BY THE ASSESSEE WITHOUT CALLING FOR THE REMAND REPORT, AS PER PROVISIONS OF RULE 46-A OF THE I.T.RULES, 1962. 3. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ALL OR ANY OF THE AFORESAID GROUNDS OF APPEAL AND AMEND, ALTER OR ADD ANY OTHER GROUND OF APPEAL. 2. HOWEVER AT THE TIME OF HEARING, THE PARTIES WERE HEARD ONLY IN RESPECT TO GROUND NO-2 AGITATING FRESH EVIDENCE ENTERTAINED UN DER RULE 46A OF THE IT RULES, 1962. ADDRESSING THE SAME, THE LD. SR. DR, MS. MEE NAKSHI VOHRA INVITING ATTENTION TO THE ASSESSMENT ORDER DATED 24.12.2010 SUBMITTED THAT THE ASSESSEE WHO IS ENGAGED IN THE BUSINESS OF TRADING OF CLOTHES. REFERRING T O PARA 4 OF THE SAME IT WAS SUBMITTED THAT THE ASSESSEE WAS CONFRONTED BY THE AO WITH THE DISCREPANCIES IN THE MONTH-WISE 2 I.T.A .NO.-216/DEL/2012 SALES AND PURCHASE DETAILS PROVIDED. REFERRING TO THE SAME, IT WAS POINTED OUT THAT THE AO THEREAFTER COMES TO THE CONCLUSION THAT THE ASSE SSEE THROUGH THE AR WAS NOT ABLE TO PRODUCE ANY JUSTIFICATION OR ANY SUBMISSION TO S UBSTANTIATE ITS CLAIM. ACCORDINGLY THE AO CONCLUDED THAT THE ASSESSEE HAD MADE PURCHA SES OUTSIDE THE BOOKS AMOUNTING TO RS.12,27,727/- WHICH WAS TREATED AS INCOME OF TH E ASSESSEE ON ACCOUNT OF PURCHASE FROM UNDISCLOSED SOURCES. THE RELEVANT FINDING IS EXTRACTED HEREUNDER FOR READY- REFERENCE:- DURING THE COURSE OF ASSESSMENT PROCEEDINGS, ASSES SEE PRODUCED BOOKS OF ACCOUNTS WITH BILLS AND VOUCHERS WHICH WERE CHECKED ON TEST CHECK BASIS. DURING THE COURSE OF ASSESSMENT PROCEEDING ON 23-12 -2010, AR WAS CONFRONTED WITH THE FOLLOWING DISCREPANCY IN MONTHWISE SALES A ND PURCHASE WHICH ARE AS UNDER:- SL. NO. DESCRIPTION AMOUNT 1. SALES BETWEEN APRIL, 2007 TO JUNE, 2007 RS.12,93,086/- 2. AFTER REDUCING GP OF 10.31% COST OF GOODS SOLD A RS.11,59,769/- 3. OPENING STOCK AND PURCHASES FROM APRIL, 2007 TO JUNE, 2007 B RS.15,720/- 4. A-B C RS.11,44,049/- 5. SALES BETWEEN JULY, 2007 TO JANUARY 2008 RS.60,89,615/- 6. COST OF GOODS SOLD AFTER REDUCING GP OF 10.31% D RS.54,60,558/- 7. PURCHASES BETWEEN JULY, 2007 TO JANUARY 2008 E RS.53,76,880/- 8. D-E F RS.83,678/- TOTAL SALES MADE OUTSIDE THE BOOKS C+F=RS.11,44,049 /- + RS.83,678/- =RS.12,27,727/-. THE AR WAS NOT ABLE TO PRODUCE ANY JUSTIFICATION AN D SUBMISSION TO SUBSTANTIATE THE SAME. IN VIEW OF THE ABOVE, IT IS CLEAR THAT ASSESSEE HAD MADE PURCHASES OUTSIDE THE BOOKS TO THE TUNE OF RS.12,27,727/- AND HE HAS NO E XPLANATION TO OFFER WITH REGARD TO THE ABOVE DISCREPANCY. HENCE, THE ADDITI ON OF RS.12,27,727/- IS MADE TO THE INCOME OF THE ASSESSEE ON ACCOUNT OF PURCHASES FROM UNDISCLOSED SOURCES. FURTHER, I AM SATISFIED THAT THE ASSESSEE HAD PROVI DED INACCURATE PARTICULARS OF ITS INCOME AND THEREFORE PENALTY PROCEEDINGS U/S 271(1) (C) OF THE I.T.ACT, 1961 HAVE BEEN INITIATED SEPARATELY. (EMPHASIS BY BOLD TEXTING PROVIDED) 3. IN THIS BACKGROUND INVITING ATTENTION TO PARA 4. 3 OF THE IMPUGNED ORDER, IT WAS HER SUBMISSION THAT THE CIT(A) HAS TAKEN INTO CONSI DERATION CONFIRMATION FROM 3 I.T.A .NO.-216/DEL/2012 RAJASTHAN KNITTING MILLS , WAZIRPUR INDL. AREA, DEL HI WHICH WAS NEVER FILED BEFORE THE AO AND HAS ALSO RELIED UPON COPIES OF CHALLAN A ND BILLS WHICH WERE NEVER MADE AVAILABLE TO THE AO AND WERE FILED FOR THE FIRST T IME BEFORE THE CIT(A). TAKING THESE FRESH EVIDENCES INTO CONSIDERATION, IT WAS SUBMITTE D THE CIT(A) HAS COME TO THE CONCLUSION THAT THE SAID CONCERN WAS FOLLOWING THE PRACTICE OF DISPATCHING GOODS ON CHALLAN AND BILLS WERE MADE LATER ON. IT WAS HER S UBMISSION THAT THE EVIDENCE SHOULD HAVE BEEN CONFRONTED TO THE AO AND REMAND REPORT OB TAINED BEFORE ARRIVING AT A CONCLUSION. INVITING FURTHER ATTENTION TO THE SAID PARA OF THE IMPUGNED ORDER, IT WAS HER SUBMISSION THAT THE CIT(A) FURTHER RECORDS THAT MONTH-WISE DETAILS OF PURCHASE AND SALE WERE FILED FOR THE FIRST TIME BEFORE HIM. IN THIS BACKGROUND IT WAS HER SUBMISSION THAT THERE IS NO DEBATE THAT FRESH EVIDE NCE HAS BEEN FILED AND WITHOUT CONFRONTING THE SAME TO THE AO RELIEF HAS BEEN GRAN TED. THE SAID EVIDENCE IT WAS SUBMITTED SHOULD HAVE BEEN CONFRONTED TO THE AO AS SUCH THE IMPUGNED ORDER IS PERVERSE ON ACCOUNT OF THIS FACT. RELIANCE WAS PLA CED UPON THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF MANISH BUI LDWELL 245 ITR 397 (DELHI) AND DIT VS MODERN CHARITABLE FOUNDATION 335 ITR 105 (DE LHI) ON THE SAME PROPOSITION. 4. LD. AR, SH. RAKESH CHADHA ON THE OTHER HAND REL YING UPON THE IMPUGNED ORDER CONTENDED THAT THE ASSESSEE HAD COURIERED ALL THESE DOCUMENTS TO THE AO ON 27.12.2010 AND IT IS THESE VERY DOCUMENTS WHICH WE RE TAKEN INTO CONSIDERATION BY THE CIT(A). IT WAS HIS STAND THAT THE DOCUMENTS WERE FILED IN CONTINUATION OF THE ASSESSMENT PROCEEDINGS AS THEY WERE COURIERED ON 27 .12.2010. HOWEVER THE RECORD SHOWS THAT THE ASSESSMENT ORDER IS DATED 24.12.2010 AS SUCH ADMITTEDLY THE SAME WERE FILED AFTER THE PASSING OF THE ASSESSMENT ORDER. I N THE LIGHT OF THIS FACTUAL POSITION, NOT BEING IN DISPUTE WHERE ADMITTEDLY THE DOCUMENTS WE RE NEVER MADE AVAILABLE TO THE AO AS THEY WERE COURIERED ONLY AFTER THE PASSING OF THE ASSESSMENT ORDER ACCORDINGLY AFTER HEARING THE PARTIES WE DEEM IT APPROPRIATE TO RESTORE THE ISSUE BACK TO THE FILE TO THE AO FOR CONSIDERATION OF THE SAME. LD. AR REQUE STED THAT THE ISSUE MAY BE CONFINED ONLY TO THE FRESH EVIDENCES CONSIDERED BY THE CIT(A). CONSIDERING THE 4 I.T.A .NO.-216/DEL/2012 REQUEST ON FACTS WE RESTORE THE ISSUE TO THE AO WIT H THE LIMITED MANDATE TO TAKE INTO CONSIDERATION THE DOCUMENTS RELIED UPON BY THE ASSE SSEE BEFORE THE CIT(A) AND PASS A SPEAKING ORDER IN ACCORDANCE WITH LAW AFTER GIVING THE ASSESSEE A REASONABLE OPPORTUNITY. THE SAID ORDER WAS PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING IN THE PRESENCE OF THE PARTIES. 5. IN THE RESULT THE APPEAL OF THE REVENUE IS ALLOW ED FOR STATISTICAL PURPOSES. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 11 TH OF MARCH 2014. SD/- SD/- (T.S.KAPOOR) (DIVA SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED:- 11 /03/2014 *AMIT KUMAR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI