DCIT, New Delhi V. Sh. Naveen Aggarwal, New Delhi

ITA 2163/DEL/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 74035 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 8 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-01-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 06-06-2013
• Assessment Year: 2004-2005
• Appeal Filed On: 07-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMIT GOEL
• Assessee Lawyers: GUNJAN P RASAD

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH E NEW DELHI) BEFORE SHRI U.B.S. BEDI, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER I.T.A. NO.2163/DEL./2012 ASSESSMENT YEAR: 2004-05 DY. CIT, VS. NAVEEN AGGARWAL CEN. CIRCLE-6, E-40/3, OKHLA INDL. AREA, NEW DELHI PHASE-II, NEW DELHI PAN/GIR NO. ADLPA 0602 J (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI AMIT GOEL, FCA RESPONDENT BY : SHRI GUNJAN PRASAD, CIT- DR ORDER PER U.B.S. BEDI, JM: THIS APPEAL OF THE DEPARTMENT IS DIRECTED A GAINST THE ORDER PASSED BY LEARNED CIT(A-I), NEW DELHI DATED 02-02-2012 REL EVANT TO ASSESSMENT YEAR 2004-05, WHEREBY BESIDES CHALLENGING ADDITION OF RS.62,000/- OUT OF TOTAL ADDITION OF RS.1,32,000/- MADE BY THE ASSESSI NG OFFICER ON ACCOUNT OF HOUSEHOLD WITHDRAWALS, ASSESSEE HAS ALSO CHALLENGED DELETION OF ADDITION OF RS.11,98,173/- MADE BY THE ASSESSING OFFICER ON ACC OUNT OF PURCHASE FROM PRINCE FABRICATOR HOLDING THE SAME TO BE UNVERIFIAB LE AS ASSESSEE DID NOT FILE CONFIRMATION DESPITE VARIOUS OPPORTUNITIES AFFORDED TO HIM AND THUS FAILED TO PROVE THE GENUINENESS OF TRANSACTION. I.T.A. NO. 2163/DEL/2012 2 2. AS REGARDS THE FIRST ISSUE, ASSESSING OFFICER W AS OF THE VIEW THAT THIS WITHDRAWAL OF RS.36,000/- WAS NOT SUFFICI ENT LOOKING INTO THE STATUS OF THE ASSESSEE AND, THEREFORE, HE MADE AN ADDITION OF RS.1,32,000/- BY ESTIMATING THE MONTHLY EXPENDITURE OF RS.14,000/-. IN APPEAL, PART RELIEF WAS GIVEN BY LEARNED CIT(A) BY RESTRICTING SUCH ADDITIO N TO RS.60,000/- AGAINST WHICH DEPARTMENT HAS FILED APPEAL AND LEARNED DR HA S RELIED UPON THE ORDER OF THE ASSESSING OFFICER TO PLEAD FOR SETTING ASIDE THE ORDER OF LD. CIT(A) AND TO RESTORE THAT OF THE ASSESSING OFFICER AND WH EN LD. D.R. WAS ASKED FOR THE REASONING, HE JUST RELIED UPON THE ORDER OF THE ASSESSING OFFICER AND LEARNED COUNSEL RELIED UPON THE ORDER OF LEARNED CI T(A) TO PLEAD FOR HIS CONFIRMATION. 2.1 WE HAVE HEARD BOTH THE SIDES, CONSIDERED THE MA TERIAL ON RECORD AND FIND THAT LD. CIT(A) HAS PASSED A VERY REASONED ORD ER WHEN NO INFIRMITY OR FLAW IN HIS ORDER HAS BEEN FOUND OR POINTED OUT. O THERWISE, THE ORDER APPEARS TO BE JUST AND APPROPRIATE BECAUSE NORMAL P ROBABILITIES HAVE BEEN TAKEN INTO CONSIDERATION FOR ARRIVING AT THE FIGURE OF ADDITION ON ACCOUNT OF HOUSEHOLD EXPENSES, WHICH CAME TO BE RESTRICTED TO RS.60,000/- WHEN THE ASSESSEE HAS ALREADY DECLARED RS.36,000/- AGAINST H OUSEHOLD EXPENSES. SO, IN ALL, HOUSE OLD EXPENSES HAVE BEEN ESTIMATED BY L D. CIT(A) AT RS.96,000/- I.E. RS.8,000/- PER MONTH, WHICH APPEARS TO BE JUST IFIED. AS SUCH, WE DO NOT FIND ANY GROUND TO INTERFERE IN THIS ORDER PASSED B Y LD. CIT(A) WHICH IS CONFIRMED AND THIS GROUND OF THE REVENUE IS DISMISS ED. 3. THE 2 ND GROUND RELATES TO DELETION OF ADDITION OF RS.11,98 ,173/- MADE BY THE A.O. ON ACCOUNT OF PURCHASES FROM PRINCE FAB RICATORS HOLDING THE SAME TO BE UNVERIFIABLE AS THE ASSESSEE DID NOT FIL E ITS CONFIRMATION DESPITE VARIOUS OPPORTUNITIES AFFORDED TO THE ASSESSEE TO P ROVE GENUINENESS OF I.T.A. NO. 2163/DEL/2012 3 TRANSACTION. THEREFORE, THE ORDER OF LD. CIT(A) IN THIS REGARD SHOULD BE SET ASIDE AND THAT THE A.O. SHOULD BE RESTORED. 4. THE FACTS INDICATE THAT THE A.O. HAD ASKED THE A SSESSEE TO PRODUCE CONFIRMATION FORM M/S. PRINCE FABRICATORS IN RESPON SE TO WHICH, THE ASSESSEE STATED THAT HE HAS NOT MADE FURTHER PURCHASES SINCE THE MATERIAL WAS DEFECTIVE AND HE HAS NOT PAID ANY MONEY NOR HAS HE RECEIVED THE MATERIAL AND IT IS DIFFICULT TO GET CONFIRMATION FROM THE PA RTY. THEREFORE, THE ADDITION MADE BY THE A.O. TO THE EXTENT OF RS.11,98,173/- WA S CHALLENGED BEFORE LD. CIT(A) AND IT WAS CONTENDED IN FIRST APPELLATE STAG E THAT THE ASSESSEE HAS SUBMITTED THE COPIES OF BILLS, BUILTY, WEIGHMENT RE CEIPT AND BORDER BARRIER STAMP ETC. TO THEM AND IF THE A.O. WAS NOT SATISFIE D WITH THIS, HE SHOULD HAVE MADE INDEPENDENT INQUIRY. JUST BECAUSE THE CONFIR MATION OF THE PURCHASE WAS NOT PRODUCED BEFORE THE A.O., IT WAS CONTENDED THAT THE SAME CANNOT BE MADE THE BASIS FOR MAKING SUCH ADDITION. THE ASSES SEE HAS FURTHER STATED IN FIRST APPEAL THAT OTHERWISE THE TRANSACTION IS REVE NUE NEUTRAL BECAUSE THIS AMOUNT HAS BEEN SHOWN AS CLOSING STOCK ON THE CREDI T SIDE IN THE P & L ACCOUNT. SO, NO ADDITION IS CALLED FOR, WHICH SHOU LD BE DELETED. 5. LD. CIT(A), CONSIDERING THE PLEA OF THE ASSESSEE , HAS CONCLUDED TO DELETE THE IMPUGNED ADDITION AS PER PARA 5.3 OF HIS ORDER WHICH IS REPRODUCED AS UNDER: I HAVE GONE THROUGH THE SUBMISSION OF THE ASSESSEE AS WELL AS THE OBSERVATIONS MADE BY THE A.O. THE CONTENTION OF TH E ASSESSEE THAT SINCE THE MATERIAL WAS DEFECTIVE, HE HAS NEITHER MA DE THE PAYMENT NOR HE HAS BEEN ABLE TO SELL THIS MATERIAL IS FORTIFIED BY THE P & L ACCOUNT WHICH SHOWS THE BALANCE OF CLOSING STOCK AT RS.12,8 6,860/-. IN FACT THE ENTIRE AMOUNT PURCHASED HAS BEEN CREDITED IN TH E P & L ACCOUNT AS CLOSING STOCK WHICH GOES TO SHOW THAT THE TRANSA CTION IS REVENUE NEUTRAL, THUS THERE IS NO BASIS FOR MAKING THIS ADD ITION. THE ADDITION OF RS.11,98,173/- IS, THEREFORE, DELETED. I.T.A. NO. 2163/DEL/2012 4 6. AGAINST SUCH DELETION OF ADDITION, THE DEPARTMEN T HAS COME UP IN APPEAL BUT LD. D.R. HAS RELIED UPON THE ORDER OF TH E A.O. TO PLEAD FOR RESTORATION OF HIS ORDER WHEREAS, LD. COUNSEL FOR T HE ASSESSEE HAS RELIED UPON THE ORDER OF LD. CIT(A) AND PLEADED FOR CONFIRMATIO N OF THE IMPUGNED ORDER. 7. WE HAVE HEARD BOTH THE SIDES, CONSIDERED THE MAT ERIAL ON RECORD AND FIND THAT LD. CIT(A) HAS, WHILE CONSIDERING THE ENT IRETY OF THE FACTS AND CIRCUMSTANCES, MATERIAL ON RECORD AND ARGUMENTS OF THE LD. A.R., CONCLUDED TO DELETE THE AMOUNT OF ADDITION AS PER PARA 5.3 OF HIS ORDER WHICH STANDS ALREADY REPRODUCED IN EARLIER PARAGRAPH. FROM THE PERUSAL OF THE CONCLUSION AS DRAWN BY LD. CIT(A), WE DO NOT FIND ANY JUSTIFIA BLE REASON TO INTERFERE IN THE SAME AS THE ORDER PASSED BY LD. CIT(A) IS FOUND TO BE JUST, APPROPRIATE AND CORRECT IN LAW. AS SUCH, WHILE CONCURRING WITH THE FINDING OF LD. CIT(A), WE UPHELD HIS ORDER AND DISMISS THE APPEAL OF THE REVENUE ON THIS ISSUE ALSO. 8. AS A RESULT, APPEAL OF THE REVENUE IS DISMISSED. 9. ORDER PRONOUNCED IN THE OPEN COURT ON 17 TH JAN., 2014. SD./- SD./- (SHAMIM YAHYA) (U.B.S.BEDI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATE: 17 TH JAN., 2014. SP. COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A)-XXV, NEW DELHI AR, ITAT, 5. CIT(ITAT), NEW DELHI NEW DELHI