Ashok Kumar Shaw, Kolkata V. I.T.O Wd - 41(2),kolkata, Kolkata

ITA 2301/KOL/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 4908 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 8 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-05-2016
• Appeal Filed By: Assessee
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 26-08-2013
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Additional evidence
• Section: 143(3); 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH A, KO LKATA [BEFORE SHRI MAHAVIR SINGH, JM & SHRI M.BALAGANES H, AM] ITA NO.2301/KOL/2013 ASSESSMENT YEAR : 2009-10 ASHOK KUMAR SHAW -VERSUS- I.T.O., WARD-41(2), KOLKATA KOLKATA (PAN:ALYPS0683A) ( APPELLANT ) (RESPONDENT) FOR THE APPELLANT : NONE FOR THE RESPONDENT : SHRI SALLONG YADEN, ADDL.CIT, SR.DR DATE OF HEARING : 04.05.2016. DATE OF PRONOUNCEMENT : 06.05.2016. ORDER PER SHRI M.BALAGANESH, AM 1. THIS APPEAL OF THE ASSESSEE ARISES OUT OF THE OR DER OF THE LEARNED CIT(A)-XII,, KOLKATA IN APPEAL NO.514/XII/41(2)/2011-12 DATED 1 5.03.2013 PASSED AGAINST THE ORDER OF ASSESSMENT FRAMED FOR THE ASST YEAR 2009-1 0 U/S 143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT). 2. THE FIRST ISSUE TO BE DECIDED IN THIS APPEAL IS AS TO WHETHER, THE TRANSACTIONS WITH M/S. L.G.BALAKRISHNA AND BROS. PVT. LTD. AMOUNTING TO RS.12,77,000/- WITH CORRESPONDING TCS OF RS.14,469/- CAN BE CONSIDERED FOR THE PURPOSE OF ADDITION IN THE ASSESSMENT YEAR UNDER APPEAL , IN THE FACTS AND CI RCUMSTANCES OF THE CASE. 3. THE BRIEF FACTS OF THIS ISSUE ARE THAT THE ASSES SEE IS AN INDIVIDUAL DEALING IN IRON SCRAP UNDER THE NAME AND STYLE OF M/S.A.K.STEEL, A PROPRIETORSHIP CONCERN. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE LD. AO ISSUED NOTICE U/S 133(6) OF THE ACT FOR CHECKING THE GENUINENESS OF THE SUNDRY CREDITORS RE FLECTED BY THE ASSESSEE. HE OBSERVED THAT IN SOME CASES NOTICES WERE RETURNED W ITH THE REMARK LEFT OR COMPANY ABOLISHED . THE ASSESSEE HOWEVER FURNISHED PAN AS WELL AS VAT REGISTRATION DETAILS OF THE SUNDRY CREDITORS TO ESTABLISH THEIR EXISTENC E AND GENUINENESS. THE LD. AO ACCEPTED THE SAME. HOWEVER, FROM THE STATEMENT IN 2 6AS , THE AO OBSERVED THAT THE TRANSACTIONS MADE WORTH OF RS.12,77,000/- FROM M/S. L.G.BALAKRISHNAN AND BROS. PVT. ITA NO.2301/KOL/2013 ASHOK KUMAR SHAW A.Y.2009-10 2 LTD WAS NOT DISCLOSED BY THE ASSESSEE. THE ASSESSEE EXPLAINED THAT THE ASSESSEE HAS DISCLOSED EACH AND EVERY TRANSACTIONS WITH M/S. L.G .BALAKRISHNAN AND BROS. PVT. LTD AND THE ACCOUNT WAS SQUARED UP DURING THE FINANCIAL YEAR 2008-09 RELEVANT TO A.Y.2009-10 AND TCS OF RS.14,469/- WAS ALSO DISCLOS ED BY THE ASSESSEE IN THE BOOKS OF ACCOUNT AND FOR WANT OF OBTAINING THE TDS CERTIF ICATE BEFORE FILING OF RETURN OF INCOME, THE TCS OF RS.14,479/- WAS NOT CLAIMED BY T HE ASSESSEE IN THE RETURN FOR A.Y.2009-10. THE LD. AO OBSERVED THAT THESE TRANSAC TIONS ARE TAKEN INTO ACCOUNT ALTHOUGH THE ASSESSEE HAS NOT CLAIMED THE TCS. HE F URTHER OBSERVED ONCE THE ASSESSEE HAS OBTAINED THE CLARIFICATION FROM THE SAID DEDUCT OR BY MAKING THE DEDUCTOR REVISE ITS TDS RETURNS SO THAT 26AS STATEMENT DOES NOT SHOW TH IS INCOME, NECESSARY MODIFICATION TO THE ASSESSMENT SHALL BE MADE IN THE ASSESSMENT. TILL SUCH TIME, IN THE INTEREST OF THE REVENUE , THIS AMOUNT WAS ADDED BA CK BY THE LD. AO. ALL THESE FACTS ARE CLEARLY SPELT OUT IN THE ASSESSMENT ORDER. 4. ON FIRST APPEAL THE ASSESSEE FILED CERTAIN PAP ERS FOR VERIFICATION WHICH WERE TAKEN AS ADDITIONAL EVIDENCES AND THE LD. CIT(A) CALLED F OR A REMAND REPORT IN THIS REGARD. THE LD. AO IN THE REMAND PROCEEDINGS STATED THAT TH E ASSESSEE HAS FAILED TO SUBSTANTIATE HIS CLAIM BY PRODUCING NECESSARY DOCUM ENTS. THE LD. CIT(A) BASED ON THE REMAND REPORT UPHELD THE ACTION OF THE LD. AO. AGGR IEVED, THE ASSESSEE IS IN APPEAL ON THE FOLLOWING GROUNDS :- 1) THE LEARNED CIT XII, KOLKATA ERRED IN LAW AS WE LL AS IN FACTS IN NOT CONSIDERING THE DETAILED SUBMISSION OF THE APPELLANT REGARDING TRAN SACTIONS OF PURCHASE OF RS.1490345/- WITH M/S L.G. BALAKRISHNA AND BROS. PVT. LTD. FORMI NG PARTS OF TOTAL PURCHASE OF RS. 7,43,66,267.65 OF AUDITED BOOKS OF ACCOUNTS AND ALL THE PAYMENTS MADE BY BANK TRANSACTIONS AND DISMISSING GROUNDS OF APPEAL ENTIR ELY ON THE BASIS OF REMAND REPORT MADE BY AO WITH MALAFIDE INTENTION. 2) THE LEARNED CIT (A) XII, KOLKATA ERRED IN LAW AS WELL AS IN FACTS IN RELYING FULLY ON THE REMAND REPORT PREPARED BY THE AO, WITH MALAFIDE INTENTION INSTEAD OF LOOKING INTO THE TRUE STATE OF AFFAIRS OF THE PURCHASES MADE FRO M L.G. BALAKRISHNA AND BROS. PVT. LTD. DULY SHOWN IN STATEMENT FILED BY THE APPELLANT FORM ING PART OF TOTAL PURCHASE SHOWN IN AUDITED PROFIT AND LOSS ACCOUNT. 3) THE LEARNED CIT (A) DID NOT BOTHER TO LOOK INTO THE FACTS THAT NO OPPORTUNITY OF HEARING WAS ALLOWED TO THE APPELLANT AS THE NOTICE OF HEARING OF REMAND REPORT DATED 26.11.2012 AND HEARING ON 30.11.2012 WAS SERVED AS 29.11.2012 4) THAT THE LEARNED CIT (A) DID NOT APPRECIATE THE FACT THAT WITHOUT HEARING DONE HOW COULD HE JUSTIFY THAT TRANSACTION WITH L.G. BALAKRI SHNA AND BROS. PVT. LTD. WAS INGENUEINE CONTRARY TO THE VIEW OF HIS PREDECESSOR EVEN THROUGH TCS OF RS. 14469/- WAS DULY SHOWN IN AUDITED BOOKS OF ACCOUNTS. THE LEARNE D CIT(A) ALSO DID NOT APPRECIATE THE FACT THAT HOW THE AO WITHOUT HEARING CONCLUDED AND CROSSED BEYOND HIS ITA NO.2301/KOL/2013 ASHOK KUMAR SHAW A.Y.2009-10 3 PREDECESSOR, WHO MADE THE ORIGINAL ASSESSMENT ORDE R, SUBJECT MATTER OF APPEAL, THAT TRANSACTION WITH L.G. BALAKRISHNA AND BROS. P T. LT D. WERE NOT GENUINE WHILE THE REMARKS OF HIS PREDECESSOR WERE :- 'BUT THE L.G. BALAKRISHNA AND BROS. PVT. LTD. TAN:C MBL03003A SHOWN AGAINST ITS DETAILS IS NOT FOUND MENTION IN THE ACCOUNTS. IT AC COUNTS FOR RS.12, 77,000/- PAYMENT ACCRUED TO THE ASSESSEE AND A TCS OF RS. 14,469/- B UT THESE ARE TAKEN INTO ACCOUNT ALTHOUGH THE ASSESSEE HAS NOT CLAIMED/DISCLOSED THI S. ONCE THE ASSESSEE OBTAIN A CLARIFICATION FROM THE SAID DEDUCTOR AND GETS ITS T CS RETURN REVISED AND SO THAT THE 26AS STATEMENT DOES NOT SHOWN THIS INCOME, WE WOULD MAKE NECESSARY CORRECTION. TILL THAT TIME, IT IS ADDED BACK. ' 5. WE FIND THAT NONE APPEARED ON BEHALF OF THE A SSESSEE. WE HAVE HEARD THE LD. DR AND PERUSED THE MATERIALS AVAILABLE ON RECORD. WE F IND FROM THE ASSESSMENT ORDER THAT THE LD. AO WAS NOT SURE OF FRAMING THIS ADDITION. FROM THE LANGUAGE OF THE ASSESSMENT ORDER ITSELF, IT COULD BE SEEN THAT THIS ADDITION W AS MADE ONLY AS A STOP GAP ARRANGEMENT TILL SUCH TIME THE DEDUCTOR REVISES THE TDS RETURN IN ORDER TO MAKE NECESSARY MODIFICATIONS IN ORDER TO ASCERTAIN THE T RUE NATURE OF THE TRANSACTIONS. HENCE WE DEEM IT FIT IN THE FACTS AND CIRCUMSTANCES, IN T HE INTEREST OF JUSTICE AND FAIR PLAY, TO SET ASIDE THIS ISSUE TO THE FILE OF THE LD. AO TO D ECIDE THIS ISSUE AFRESH IN ACCORDANCE WITH LAW. NEEDLESS TO MENTION THAT THE ASSESSEE BE GIVEN REASONABLE OPPORTUNITY OF BEING HEARD. ACCORDINGLY GROUND NO.S 1 TO 4 ARE ALL OWED FOR STATISTICAL PURPOSES. 6. THE NEXT GROUND TO BE DECIDED IN THIS APPEAL IS AS TO WHETHER A SUM OF RS.1,64,155/- WHICH WERE REPRESENTING EXPENSES THAT WERE REFLECTED IN THE PERSONAL PROFIT AND LOSS ACCOUNT OF THE ASSESSEE AND NOT PAR T OF THE TAX AUDIT REPORT OBTAINED FOR THE BUSINESS BALANCE SHEET OF THE ASSESSEE COUL D BE DISALLOWED IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 7. DURING THE COURSE OF ASSESSMENT PROCEEDINGS T HE LD. AO OBSERVED THAT SOME EXPENSES CLAIMED IN THE PERSONAL PROFIT AND LOSS AC COUNT WHICH WERE NOT PART OF THE TAX AUDIT REPORT WHICH IN THE OPINION OF THE AO WER E NOT INCIDENTAL TO THE BUSINESS OF THE ASSESSEE. ACCORDINGLY THE LD. AO SOUGHT TO D ISALLOW THE SAME IN THE SUM OF RS.1,64,155/-. ON FIRST APPEAL THE ASSESSEE FILED S OME DETAILS WHICH WERE SENT TO THE LD. AO FOR VERIFICATION AND REMAND REPORT OBTAINED THEREON. THE LD. CIT(A) OBSERVED THAT THE LD. AO HAS NOT CHANGED ITS STAND IN THE RE MAND PROCEEDINGS AND BASED ON THE SAME HE UPHELD THE ACTION OF THE LD. AO. AGGRIEVED, THE ASSESSEE IS IN APPEAL ON THE FOLLOWING GROUNDS :- ITA NO.2301/KOL/2013 ASHOK KUMAR SHAW A.Y.2009-10 4 5) THAT THE LEARNED CIT (A) XII ERRED IN NOT CONSI DERING THE GENUINENESS OF THE CLAIM OF RS.L ,64,959.00 WHICH WERE INCURRED FOR THE PURP OSE OF BUSINESS ON THE BASIS OF RELY FULLY THE REMAND REPORT PREPARED WITH ULTERIOR MOTI VE AND MALAFIDE INTENTIONS BY THE AO. 8. WE FIND THAT NONE APPEARED ON BEHALF OF THE A SSESSEE. WE HAVE HEARD THE LD. DR AND PERUSED THE MATERIALS AVAILABLE ON RECORD. WE F IND THAT SINCE NO REPRESENTATION WAS MADE ON BEHALF OF THE ASSESSEE WE ARE NOT ABLE TO CONCLUDE AS TO WHAT DETAILS WERE FILED BY THE ASSESSEE BEFORE THE LD. AO DURING THE REMAND PROCEEDINGS AND WHAT OBSERVATIONS WERE MADE BY THE LD. AO IN HIS REMAND ORDER. HENCE IN VIEW OF THE FACTS AND CIRCUMSTANCES WE DEEM IT FIT AND PROPER, IN THE INTEREST OF JUSTICE AND FAIR PLAY, TO SET ASIDE THIS ISSUE TO THE FILE OF THE LD. AO, TO DECIDE THE SAME AFRESH, IN ACCORDANCE WITH LAW. NEEDLESS TO MENTION THAT THE ASSESSEE BE GIVEN REASONABLE OPPORTUNITY OF BEING HEARD. ACCORDINGLY GROUND NO.5 IS ALLOWED FOR STATISTICAL PURPOSES. 9. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 06.05.2016. SD/- SD/- [MAHAVIR SINGH] [M.BALAGANESH] JUDICIAL MEMBER ACCOUNTANT MEMBE R DATE: 06.05.2016. R.G.(.P.S.) COPY OF THE ORDER FORWARDED TO: 1 . ASHOK KUMAR SHAW, 147A, SOUTH SINTHI ROAD, KOLKATA- 50. 2 THE I.T.O., WARD-41(2), KOLKATA. 3 . .CIT(A)-XII, KOLKATA 4. CIT-XIV, KOLKATA 5. DR, KOLKATA BENCHES, KOLKATA TRUE COPY, BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES ITA NO.2301/KOL/2013 ASHOK KUMAR SHAW A.Y.2009-10 5