The Assistant Commissioner of Income Tax, Circle-1(1), Panaji., Panaji V. M/s Naivedya Logistics (India) Pvt. Ltd., Panaji

ITA 238/PAN/2015

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 1383 (ITAT-PANAJI)
• Duration Of Justice: 3 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-09-2015
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 08-09-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 20-05-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAMESH S MUTAGAR LD
• Assessee Lawyers: SANTOSH KENKRE
• Keywords: Principle of natural justice

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH, PANAJI BEFORE SHRI N.S. SAINI, HON'BLE ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN, HONBLE JUDICIAL MEMBER ITA NO. 238/PNJ/2015 : (A.Y 2010 - 11) ASST. COMMISSIONER OF INCOME TAX, CIRCLE - 1(1), PANAJI, GOA. (APPELLANT) VS. M/S. NAIVEDYA LOGISTICS (INDIA) PVT. LTD., A - 6, SKYLARK APARTMENTS MENEZES, BRAGANZA ROAD, PANAJI, GOA (RESPONDENT) PAN : AACCN9766F ASSESSEE BY : SANTOSH KENKRE, CA REVENUE BY : RAMESH S. MUTAGAR, LD. DR DATE OF HEARING : 08/09/2015 DATE OF PRONOUNCEMENT : 08/09/2015 O R D E R PER GEORGE MATHAN : 1. THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF CIT(A), PANAJI - 1 IN ITA NO. 99/PNJ/13 - 14 DT. 19.2.2015 FOR THE A.Y 2010 - 11. SHRI RAMESH S. MUTAGAR , LD. DR REPRESENTED ON BEHALF OF THE REVENUE AND SHRI SANTOSH KENKRE, CA REPRESENTED ON BEHALF OF THE ASSESSEE. 2. IT WAS SUBMITTED BY THE LD. DR THAT THERE WAS A SEARCH ON THE PREMISES OF M/S. PISCES EXIM ON 12.10.2010. IT WAS THE SUBMISSION THAT IN TH E COURSE OF THE SEARCH, THREE DOCUMENTS HAD BEEN FOUND REPRESENTING ONE LEDGER EXTRACT 2 ITA NO. 238/PNJ/2015 (A.Y : 2010 - 11) AND TWO CASH VOUCHERS IN THE NAME OF THE ASSESSEE WHEREIN IT WAS MENTIONED THAT CASH TO AN EXTENT OF RS. 41,30,000/ - HAD BEEN PAID TO THE ASSESSEE. IT WAS THE SUBMISSIO N THAT THE ASSESSEE IS TRADING IN MINERAL ORE. IT WAS THE SUBMISSION THAT AS THE ASSESSEE WAS UNABLE TO EXPLAIN AS TO HOW THE ASSESSEE HAS DISCLOSED THIS RECEIPT OF RS. 41,30,000/ - , THE AO HAD MADE THE ADDITION IN THE HANDS OF THE ASSESSEE. IT WAS THE SU BMISSION THAT THE LD. CIT(A) HAD DELETED THE ADDITION ON THE GROUND THAT THE PRESUMPTION THAT THE CONTENTS OF ANY PAPER FOUND DURING THE COURSE OF SEARCH ARE TRUE, APPLIES ONLY TO THE PARTY FROM WHOSE PREMISES IT HAS BEEN FOUND AND NOT ANY THIRD PARTY AND THAT THE PERSONS WHO HAVE SIGNED THE RECEIPT ARE NOT RELATED TO THE ASSESSEE AND THE AO DID NOT GIVE CROSS - EXAMINATION OPPORTUNITY TO THE ASSESSEE TO FIND OUT THE CORRECT FACTS. IT WAS THE SUBMISSION THAT THE ORDER OF THE LD. CIT(A) WAS LIABLE TO BE REVER SED INSOFAR AS THE ASSESSEE HAS NOT BEEN ABLE TO EXPLAIN OR PROVE THAT IT HAD DISCLOSED THE AMOUNT OF RS. 41,30,000/ - RECEIVED BY IT FROM M/S. PISCES EXIM. 3. IN REPLY, THE LD. AR ON BEHALF OF THE ASSESSEE SUBMITTED THAT THE ASSESSEE IS PURCHASING AND SEL LING MINERAL ORE. THE ASSESSEE HAD TRANSACTIONS WITH M/S. PISCES EXIM RUNNING INTO CRORES. THE ASSESSEE HAS NEVER DEALT WITH M/S. PISCES EXIM IN CASH. IT WAS THE FURTHER SUBMISSION THAT THE ASSESSEE HAD SPECIFICALLY REQUESTED FOR CROSS - EXAMINATION OF TH E PERSONS RESPONSIBLE IN M/S. PISCES EXIM IN THE PRESENCE OF THE AO AND IT HAD NOT BEEN PROVIDED TO THE ASSESSEE. HE DREW OUR ATTENTION TO CLAUSE (G) IN PARA 3.2 OF THE ASSESSMENT ORDER TO SUBMIT THAT THOUGH CROSS - EXAMINATION HAD BEEN SOUGHT FOR, SAME WAS NOT PROVIDED TO THE ASSESSEE. IT WAS THE FURTHER SUBMISSION THAT THERE WAS NO SIGNATURE OF ANY PERSON CONNECTED TO THE ASSESSEE - COMPANY IN THE VOUCHERS OR THE LEDGER EXTRACT TO SHOW THAT THE AMOUNT OF RS. 41,30,000/ - WAS RECEIVED BY THE ASSESSEE - COMPANY. IT WAS 3 ITA NO. 238/PNJ/2015 (A.Y : 2010 - 11) ALSO THE SUBMISSION THAT WHEN THE VOUCHERS WERE COMPARED WITH THE LEDGER EXTRACT, THE SAME DID NOT TALLY. IT WAS THE SUBMISSION THAT THE ORDER OF THE LD. CIT(A) WAS LIABLE TO BE UPHELD. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. ON A SPECIF IC QUERY FROM THE BENCH AS TO WHO ARE THE DIRECTORS OF THE ASSESSEE - COMPANY, IT WAS SUBMITTED BY THE LD. AR THAT THERE WERE THREE DIRECTORS DURING 2010 VIZ. SHRI RAJESH KAUNTE, SHRI ROHAN KAUNTE AND SHRI SHAFI ULLAL SAYYED. A PERUSAL OF THE VOUCHERS WHICH HAVE BEEN FOUND IN THE COURSE OF SEARCH ON M/S. PISCES EXIM SHOWS THAT ONE OF THE VOUCHERS HAS BEEN SIGNED BY ONE SHRI SADIA SAYYED (SHAFI). FURTHER, IN THE COURSE OF THE ASSESSMENT, AS NOTICED FROM THE ASSESSMENT ORDER, ONLY SHRI RAJESH KAUNTE HAS FILED AN AFFIDAVIT SAYING THAT THE ASSESSEE - COMPANY HAS NOT RECEIVED ANY CASH FROM M/S. PISCES EXIM. FURTHER, IT IS NOTICED THAT THE ASSESSEE HAS SPECIFICALLY REQUESTED FOR CROSS - EXAMINATION OF M/S. PISCES EXIM AND THAT HAS NOT BEEN GIVEN. A PERUSAL OF THE O RDER OF THE LD. CIT(A) ALSO CLEARLY SHOWS THAT THE LD. CIT(A) HAS RECOGNIZED THE FACT THAT THE AO DID NOT GIVE THE OPPORTUNITY OF CROSS - EXAMINATION TO THE ASSESSEE IN ORDER TO FIND THE CORRECT FACTS. THIS BEING SO, WE ARE OF THE VIEW THAT THERE HAS BEEN A SUBSTANTIAL VIOLATION OF PRINCIPLES OF NATURAL JUSTICE AND CONSEQUENTLY, WE ARE OF THE VIEW THAT THE ISSUES IN THIS APPEAL ARE LIABLE TO BE RESTORED TO THE FILE OF THE AO FOR RE - ADJUDICATION AFTER GRANTING THE ASSESSEE ADEQUATE OPPORTUNITY TO CROSS - EXAMIN E THE PERSONS RESPONSIBLE IN CONNECTION WITH M/S. PISCES EXIM, AND WE DO SO. IN THE RESULT, THE ORDER OF THE LD. CIT(A) IS SET ASIDE, AS ALSO THAT OF THE AO AND THE ISSUES IN THIS APPEAL ARE RESTORED TO THE FILE OF THE AO FOR RE - ADJUDICATION AFTER GRANTIN G THE ASSESSEE ADEQUATE OPPORTUNITY. 4 ITA NO. 238/PNJ/2015 (A.Y : 2010 - 11) 5. IN THE RESULT, THE APPEAL OF THE REVENUE IS PARTLY ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 08/09/2015. S D / - (N.S. SAINI) ACCOUNTANT MEMBER S D / - ( GEORGE MATHAN ) JUDICIAL MEMBER PLACE : PANAJI / GOA DATED : 08/09/ 201 5 *SSL* COPY TO : (1) APPELLANT (2) RESPONDENT (3) CIT(A) CONCERNED (4) CIT CONCERNED (5) D.R (6) GUARD FILE TRUE COPY, BY ORDER , 5 ITA NO. 238/PNJ/2015 (A.Y : 2010 - 11) DATE INITIAL ORIGINAL DICTATION PAD & DRAFT ORDER ARE ENCLOSED IN THE FILE 1. DRAFT DICTATED ON 08/09/2015 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 08/09/2015 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 0 9 /09/2015 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 0 9 /09/2015 JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 0 9 /09/2015 SR.PS 6. DATE OF PRONOUNCEMENT 08/09/2015 SR.PS 7. FILE SENT TO THE BENCH CLERK 0 9 /09/2015 SR.PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER