M/s PRABHAKAR PAPER MILLS PVT.LTD., Bhopal V. The ACIT 2(1), Bhopal

ITA 248/IND/2014

• Counselvise Citation: 24822714 RSA 2014
• Duration Of Justice: 1 year(s) 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-10-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 03-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Assessee Lawyers: S S DESHPANDE

Judgement Text

PRABHAKARAN PAPER MILLS ITA NO. 248/IND/2014 1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI D.T. GARASIA, HONBLE JUDICIAL MEMBER AND SHRI B.C. MEENA, HONBLE ACCOUNTANT MEMBER ITA NOS.248/IND/2014 A.Y.2007-08 M/S PRABHAKAR PAPER MILLS PVT.LTD BHOPAL PAN AABCP 855ID ::: APPELLANT VS ASSTT.COMMR. OF INCOME TAX 2(1) BHOPAL ::: RESPONDENT ITA NOS.226/IND/2014 A.Y.2007-08 ASSTT.COMMR. OF INCOME TAX 2(1) BHOPAL ::: APPELLANT VS M/S PRABHAKAR PAPER MILLS PVT.LTD BHOPAL ::: RESPONDENT PRABHAKARAN PAPER MILLS ITA NO. 248/IND/2014 2 ASSESSEE BY SHRI S.S. DESHPANDE REVENUE BY SHRI R.A. VERMA DATE OF HEARING 24 .9.2015 DATE OF PRONOUNCEMENT 5 . 1 0 .9.2015 O R D E R PER SHRI B.C. MEENA, AM THESE CROSS APPEALS FILED BY THE ASSESSEE AND REVENUE EMANATE FROM THE ORDER OF THE LEARNED CIT(A), BILASPUR, CAMP AT BHOPAL, DATED 2.1.2014. 2. THE ASSESSEE IS A PRIVATE LIMITED COMPANY AND BOOKS OF ACCOUNTS ARE MAINTAINED AND AUDITED. DURING THE ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER INQUIRED ABOUT THE SUNDRY CREDITORS AND ASKED THE ASSESSEE ABOUT THE AMOUNT OUTSTANDING FOR MORE THAN THREE YEARS. THERE WERE 21 SUCH THREE YEAR OLD CREDITORS AND THE TOTAL AM OUNT OUTSTANDING WAS RS. 34,22,380/-. THE ASSESSING OFFICE R ADDED THE SAME TO THE INCOME OF THE ASSESSEE. THE LEAR NED CIT(A) GRANTED PART RELIEF AND UPHELD THE DISALLOWANCE I N PRABHAKARAN PAPER MILLS ITA NO. 248/IND/2014 3 RESPECT OF FIVE PARTIES, NAMELY, AKRAM TRADING COMPANY, HARDAYAL ENGG. WORKS, MADHAVIR COAL CORPORATION, R.M. TRADERS AND SAGAR TRADE SERVICES TOTALING TO RS.10,73,727/-, AND IN THE ABSENCE OF ANY EXPLANATION REGARDING THE GENUINENESS OF TRANSACTION. THE LEARNED CIT(A) SUSTAINED THE ADDITION OF RS.10,73,727/-. BOTH SIDES ARE IN APPEAL TAKING FOLLOWING GROUNDS :- ITA NO. 248/IND/2014 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. COMMISSIONER OF INCOME TAX (A) WAS NOT JUSTIFIED IN CONFIRMING A ADDITION OF RS.1074474/- TOWARDS UNPAID SUNDRY CREDITORS TREATED AS BOGUS BY THE A.O. ITA NO. 226/IND/2014 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT(A) HAS ERRED IN RESTRICTING THE ADDIT ION TO RS.10,73,727/- IN PLACE OF THE TOTAL ADDITION OF PRABHAKARAN PAPER MILLS ITA NO. 248/IND/2014 4 RS.34,22,380/- MADE BY A.O. ON ACCOUNT OF SUNDRY CREDITORS. 3. AFTER HEARING BOTH THE SIDES, WE FIND THAT THE LE ARNED CIT(A) HAS GRANTED PART RELIEF TO THE ASSESSEE AFTER CONSIDERING THE SUBMISSIONS AND EXPLANATIONS MADE BY T HE ASSESSEE. THE REVENUE HAS FAILED TO CONTROVERT THE FIN DINGS OF THE LEARNED CIT(A) IN RESPECT OF 16 CREDITORS WHI CH HAVE BEEN ACCEPTED BY LEARNED CIT(A) AS GENUINE, THEREFORE WE FIND NO MERIT IN THE APPEAL OF THE REVENUE. HOWEVER, IN RESPECT OF FIVE CREDITORS WHICH WERE HELD TO BE NON -GENUINE, WE HOLD THAT CERTAIN MORE FACTS NEED TO BE BROUGHT ON RECORD TO DECIDE THE ISSUE, THEREFOR, AFTER HEARING B OTH THE SIDES, WE RESTORE THIS ISSUE TO THE FILE OF THE ASS ESSING OFFICER TO DECIDE DE NOVO. THE ASSESSEE SHALL PROVID E CORRECT ADDRESSES OF THESE FIVE CREDITORS AND THE AS SESSING OFFICER WILL VERIFY WHETHER THESE CONCERNS ARE SHOWI NG OUTSTANDING IN THEIR BOOKS OF ACCOUNTS AGAINST THE PRABHAKARAN PAPER MILLS ITA NO. 248/IND/2014 5 ASSESSEE. WHETHER THE CREDITORS ARE GENUINE OR NOT. A FTER CONSIDERING ALL THESE, ASSESSING OFFICER SHALL DECIDE THE ISSUE AS PER LAW. 4. IN THE RESULT, THE REVENUES APPEAL IS DISMISSED AN D THE ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPSOES . PRONOUNCED IN OPEN COURT ON 5 TH OCTOBER, 2015 SD SD 5.10.15 (D.T. GARASIA) (B.C. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER 5 TH OCTOBER, 2015 DN/-