The ITO, Ward-3(2), JAMNAGAR V. Shri Rambhai Savabhai Detharia, JAMNAGAR

ITA 237/RJT/2011

• Counselvise Citation: 23724914 RSA 2011
• Duration Of Justice: 9 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-03-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 22-03-2012
• Assessment Year: 2003-2004
• Appeal Filed On: 25-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MK SINGH
• Keywords: Opportunity of being heard

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT BEFORE SHRI T.K. SHARMA,JM AND SHRI D. K. SRIVASTAV A,AM. ITA NO. 237/RJT/2011. (ASSESSMENT YEAR 2003-04) THE I.T.O., WARD-3(2), VS SHRI RAMBHAI SAVABHAI DE THARIA, JAMNAGAR. PROP.M/S. RAM CONSTRUCTION CO., AERODRAM ROAD, JAMNAGAR. PAN: ACFPD0384B. (APPELLANT) (RESPONDENT) DATE OF HEARING : 22-03-2012. DATE OF PRONOUNCEMENT : 23-03-2012. REVENUE BY : SHRI M. K. SINGH, D. R. ASSESSEE BY : NONE. O R D E R T. K. SHARMA, J. M. : THIS APPEAL BY THE REVENUE IS AGAINST THE ORDER DA TED 29-03-2011 OF CIT (A, JAMNAGAR FOR THE ASSESSMENT YEAR 2003-04. 2. BRIEFLY STATED THE FACTS ARE THAT THE ASSESSEE I S AN INDIVIDUAL AND ENGAGED IN BUSINESS OF CIVIL CONSTRUCTION IN HIS PROPRIETOR SHIP CONCERN VIZ.; M/S. RAM CONSTRUCTION CO. FOR THE ASSESSMENT UNDER APPEAL, HE FILED THE RETURN OF INCOME DECLARING TOTAL INCOME OF RS.1,05,000/- ON 24-11-20 03. AO FRAMED THE ASSESSMENT U/S.143(3) ON 15-02-2006 WHEREIN, HE MAD E THE ADDITION OF RS.1,17,800/- U/S.40A(3) AS WELL AS RS.11,94,647/- ON ACCOUNT OF BOGUS EXPENDITURE. SUBSEQUENTLY, THE LD. CIT(A) VIDE ORDE R DATED 16-10-2006 DELETED THE ADDITION OF RS.11,94,647/-. ON FURTHER APPEAL TO THE ITAT, RAJKOT IN ITA NO. 25/RJT/2007 DATED 31-07-2008 SET-ASIDE THE ORDER OF LD. CIT(A) AND RESTORED THE MATTER BACK TO THE FILE OF AO FOR FRESH CONSIDERATI ON GIVING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. ITA NO 237/RJT/2011. 2 3. IN PURSUANCE OF DIRECTION BY THE ITAT, THE ASSES SING OFFICER FRAMED THE ASSESSMENT U/S.144 WHEREIN, HE AGAIN MADE THE ADDIT ION OF R.11,94,647/- ON THE GROUND THAT ASSESSEE FAILED TO COMPLY WITH VARIOUS NOTICES ISSUED AND SERVED ON HIM. 4. AGAINST THE AFORESAID ORDER, THE ASSESSEE PREFER RED APPEAL BEFORE LD. CIT(A). THE LD. CIT(A) IN IMPUGNED ORDER DATED 29- 03-2011 DELETED THE ADDITION OF RS.11,94,747/- FOR THE DETAILED REASON GIVEN IN PARA-7 WHICH READS AS UNDER:- 7. I HAVE CAREFULLY CONSIDERED THE ISSUE, IT IS FO UND TAT DUE TO WRONG REPRESENTATION BEFORE ITAT, MATTER WAS SET ASIDE TO THE FILE OF ASSESSING OFFICER FOR FRESH CONSIDERATION. IT IS SEEN THAT A LL MATERIAL EVIDENCES, NAME, ADDRESS, CONFIRMATIONS, INCOME TAX RETURN, CONTRA A CCOUNTS, BILLS AND VOUCHERS WERE AVAILABLE ON RECORD. HENCE NO NEW IN FORMATION WAS REQUIRED FROM THE ASSESSEE FOR DECIDING THE MATTER. THE SAME IN AFFIRMED BY THE AO IN HIS REMAND REPORT. IT IS SEEN THAT TH E APPELLANT HAS ISSUED CHEQUES TO THREE PARTIES, WHICH WERE MIS-POSTED IN DIFFERENT ACCOUNTS, THE SAID MISTAKE WAS SU MOTO RECTIFIED BY THE APPELLANT BEFORE COMMENCEMENT OF ORIGINAL SCRUTINY ASSESSMENT. THE S AID MIS-POSTING HAS NOTHING TO DO WITH EXPENDITURE DEBITED IN PROFIT AN D LOSS ACCOUNT. EVEN GENUINENESS OF EXPENDITURE WAS NOT AT ALL DOUBTED B Y ASSESSING OFFICER IN ORIGINAL ASSESSMENT, THE APPELLANT HAD SUBMITTED NA ME, ADDRESS, CONFIRMATIONS, INCOME TAX RETURN, CONTRA ACCOUNTS, BILLS AND VOUCHERS TO PROVE EXPENDITURE WHICH IS ALREADY AVAILABLE ON REC ORD. MERE MIS POSTING OF PAYMENT TO DIFFERENT ACCOUNT ITSELF DOES NOT PRO VE AND SOLE GROUND FOR DISALLOWING EXPENDITURE, WHICH IS OTHERWISE SUPPORT ED AND CONFIRMED BY RECIPIENTS. HENCE ADDITION OF RS.11,94,647/- IS HER EBY DELETED. 5. AGGRIEVED WITH THE ORDER OF LD. CIT(A), THE REVE NUE IS IN APPEAL BEFORE THE TRIBUNAL ON THE FOLLOWING GROUNDS:- (1) THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN DEL ETING ADDITION OF RS.1194747/- MADE ON ACCOUNT OF DISALLOWANCE OF CLA IM OF EXPENDITURE HELD TO BE BOGUS. (2) THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN NOT APPRECIATING THE FACT THAT INFORMATION GATHERED FROM CENTRAL BANK O F INDIA REVEALED THAT THE PAYMENTS WERE NOT ACTUALLY MADE TO RESPECT IVE PERSONS AS CLAIMED BY THE ASSESSEE. ITA NO 237/RJT/2011. 3 6. ON THE DATE FIXED FOR HEARING, NONE WAS PRESENT FROM THE SIDE OF THE ASSESSEE.. ON BEHALF OF THE REVENUE, SHRI M. K. SI NGH, D.R. APPEARED AND CONTENDED THAT AO FRAMED ASSESSMENT U/S.144 BECAUSE NO COMPLIANCE WAS MADE BEFORE THE AO. UNDER THESE CIRCUMSTANCES, THE LD. D.R. POINTED OUT THAT DL. CIT(A) ERRED IN DELETING THE ADDITION WITHOUT A PPRECIATING THE FACT THAT INFORMATION GATHERED FROM CENTRAL BANK OF INDIA REV EALED THAT THE PAYMENT WAS NOT ACTUALLY MADE TO THE RESPECTIVE PERSONS AS CLAI MED BY THE ASSESSEE.. 7. AFTER HEARING LD. D.R., WE HAVE CAREFULLY GONE T HROUGH THE ORDER OF AUTHORITIES BELOW. IT IS PERTINENT TO NOTE THAT BEF ORE DELETING IMPUGNED ADDITION OF RS.11,94,747/-, THE LD. CIT(A) HAS CALLED THE REMAN D REPORT FROM THE AO. VIDE LETTER DATED 22-03-2011. THE AO WAS ALSO REQUESTED TO REMAIN PRESENT FOR HEARING. BEFORE THE LD. CIT(A), THE ASSESSEE. CONT ENDED THAT IN ORIGINAL APPEAL PROCEEDINGS, REMAND REPORT DATED 21-09-2006 WAS SUB MITTED AND BASE ON WHICH, THE APPEAL ORDER WAS PASSED BUT DUE TO WRONG REPRESENTATION BEFORE ITAT, THE MATTER WAS SET-ASIDE FOR FRESH CONSIDERAT ION. IT WAS THEREFORE, CONTENDED THAT SINCE THE ISSUE IS ALREADY DISCUSSED , IN THE EARLIER REMAND REPORT DATED 21-09-2006, SAME MAY BE CONSIDERED. FROM THE PERUSAL OF PARA-6 OF THE IMPUGNED ORDER, IT IS CLEAR THAT AFTER CONSIDERING THE REMAND REPORT, THE LD. CIT(A) DELETED THE ADDITION OBSERVING THAT GENUINENESS OF THE EXPENDITURE WAS NOT AT ALL DOUBTED BY THE AO IN ORIGINAL ASSESSMENT. THE ASSES SEE HAD ALREADY SUBMITTED NAME, ADDRESS, CONFIRMATIONS, INCOME TAX RETURN, CO NTRA ACCOUNTS, BILLS AND VOUCHERS TO PROVE EXPENDITURE WHICH ARE AVAILABLE O N RECORD. WE THEREFORE, OF THE VIEW THAT IN THE IMPUGNED ORDER, THE LD. CIT(A) HAS GIVEN COGENT REASON FOR DELETING THE ADDITION OF RS.11,94,647/-. THEREFORE , WE INCLINED TO INTERFERE. 8. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. THIS ORDER PRONOUNCED IN THE OPEN COURT ON 23-03-20 12. SD/- SD/- ( D. K. SRIVASTAVA ) (T.K. SHARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER RAJKOT, DT :23-03-2012. NVA/- ITA NO 237/RJT/2011. 4 COPY TO: 1. THE I.T.O., WARD-3(2), JAMNAGAR.. 2. SHRI RAMBHAI SAVABHAI DETHARIA, JAMNAGAR.. 3. THE CIT, JAMNAGAR.T 4. THE CIT-(A), JAMNAGAR. 5. THE DR, I.T.A.T., RAJKOT 6. THE GUARD FILE. (TRUE COPY) BY ORDER ASSTT.REGISTRAR, ITAT, RAJKOT