ITO, New Delhi V. Shri Maqbool Hasan, New Delhi

ITA 2514/DEL/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 65324 (ITAT-DELHI)
• Duration Of Justice: 3 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-08-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 26-07-2012
• Assessment Year: 2009-2010
• Appeal Filed On: 24-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R S NEGI
• Assessee Lawyers: ASHWANI TANEJA; DR RAKESH GUPTA
• Section: 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES: E NEW DELHI BEFORE SHRI J.SUDHAKAR REDDY, ACCOUNTANT MEMBER AND SHRI CM GARG, JUDICIAL MEMBER ITA NO: 2514/DEL/2012 ASSESSMENT YEAR : - 2000-2010 ITO, WARD 30(1) VS. SHRI MAQBOOL HASAN ROOM 111, DRUM SHAPE BLDG. 305, VARDHMAN CITI PLAZ A-II NEW DELHI ASAF ALI ROAD NEW DELHI 110 002 PAN: ABCPH7592R (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI R.S.NEGI, SR.D.R. RESPONDENT BY : SHRI ASHWANI TANEJA, ADV. & DR.RAKESH GUPTA, ADV. O R D E R PER J.SUDHAKAR REDDY, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE REVENUE DIRECTED AG AINST THE ORDER DATED 22.3.2012 OF LD.COMMISSIONER OF INCOME TAX ( APPEALS)-XXV, NEW DELHI PERTAINING TO ASSESSMENT YEAR 2009-2010. 2. THE FACTS ARE GIVEN IN PARA 3.1 AND 3.2 OF COMMISSI ONER OF INCOME TAX (APPEALS)S ORDER WHICH ARE EXTRACTED FOR READY REFERENCE. 3.1. THE FACTS EMANATING FROM THE ORDER OF THE ASS ESSING OFFICER AND THE SUBMISSIONS OF THE ASSESSEE IS THAT THE ASSESSEE HAD FILED E-RETURN WITH ITO CPC BANGALORE ON 29.9. 2009 WITH THE RETURN INCOME OF RS.3,10,006/-. THE RETURN WAS PROCESSED UNDER SECTION 143(1) BY THE ITO CPC, BANGALORE ON T HE TOTAL INCOME OF RS.56,06,290/- AND A DEMAND OF RS.21,20,9 56/- WAS RAISED AGAINST THE ASSESSEE. 3.2. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF THE ASSESSING OFFICER AND IT IS SUBMITTED THAT THERE WA S A MISTAKE ON ITA NO. 2514/DEL/2012 PAGE 2 OF 4 ASSESSMENT YEAR 2009-10 SH. MAQBOOL HASAN, NEW DELHI THE PART OF THE ASSESSEE NOT TO FILL UP THE COLUMN OF THE OPENING STOCK AMOUNT OF RS.52,96,285/- AND AS SUCH THE ITO CPC, BANGALORE HAS RAISED THE DEMAND OF RS.21,20,956/-. IT IS SUBMITTED THAT THE ASSESSEE HAD ALSO SUBMITTED A PE TITION UNDER SECTION 154 BEFORE THE ITO CPC, BANGALORE BUT THE S AME HAS BEEN REJECTED BY THE ASSESSING OFFICER. IT IS ALSO SUBMITTED THAT THE ASSESSEE HAD APPROACHED THE ASSESSING OFFICER W ITH A RECTIFICATION PETITION UNDER SECTION 154 BUT THE AS SESSING OFFICER ITO WARD 30(1) NEW DELHI HAD REFUSED TO RECEIVE THE RECTIFICATION APPLICATION AND HAD DIRECTED TO FILE APPEAL BEFORE THE LD.CIT(A). IT IS SUBMITTED BY THE ASSESSEE THAT THERE WAS A MI STAKE ON THE PART OF THE ASSESSEE AS THE ASSESSEE DID NOT FILL U P THE OPENING STOCK FIGURE OF RS.52,96,285/- WHICH IS ALSO THE CL OSING STOCK FIGURE OF THE PRECEDING ASSESSMENT YEAR I.E. ASSESS MENT YEAR 2008-09 AND AS SUCH THE ASSESSING OFFICER IS NOT JU STIFIED TO REJECT THE CLAIM OF THE ASSESSEE AND RECTIFY THE IN TIMATION UNDER SECTION 143(1). 3. THE COMMISSIONER OF INCOME TAX (APPEALS) ASKED F OR THE REMAND REPORT FROM THE ASSESSING OFFICER. THE ASSESSING O FFICER, AS PER THE COMMISSIONER OF INCOME TAX (APPEALS) GAVE A SKETCHY REPORT. THEREAFTER THE COMMISSIONER OF INCOME TAX (APPEALS) FOR REASON S GIVEN IN HIS ORDER ALLOWED THE APPEAL. 4. WE HAVE HEARD SHRI R.S.NEGI, SR.D.R. ON BEHALF O F THE REVENUE AND MR.ASHWANI TANEJA, LD.COUNSEL FOR THE ASSESSEE. ON A CAREFUL CONSIDERATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND A PERUSAL OF THE PAPERS ON RECORD AND THE ORDERS OF THE AUTHORIT IES BELOW, WE HOLD AS FOLLOWS:- 5. THE ARGUMENT OF THE LD.D.R. THAT NO RECTIFICATIO N UNDER SECTION 154 LIES UNDER SECTION 143(1) IS LEGALLY INCORRECT IN VIEW OF S.154(1)(B) OF THE INCOME TAX ACT, 1961. COMING TO THE FACTS, TH E ASSESSING OFFICER NOR THE LD.D.R. COULD DEMONSTRATE THAT THE CLAIM OF THE ASSESSEE THAT IT ITA NO. 2514/DEL/2012 PAGE 3 OF 4 ASSESSMENT YEAR 2009-10 SH. MAQBOOL HASAN, NEW DELHI HAD FAILED TO FILL UP THE OPENING STOCK COLUMN AND THAT THE OPENING STOCK AMOUNT WAS RS.52,96,285/- IS INCORRECT. 6. THE HONBLE SUPREME COURT IN THE CASE OF VKJ BU ILDERS AND CONTRACTORS P.LTD. VS. CIT, 318 ITR 204 (S.C.) HAS HELD THAT IT IS A FUNDAMENTAL PRINCIPLE OF ACCOUNTANCY THAT THE FIGUR E OF THE CLOSING STOCK OF THE EARLIER YEAR HAS TO FORM THE OPENING STOCK O F THE NEXT ACCOUNTING YEAR. 7. THE COURT HELD THAT THE ASSESSING OFFICER OUGHT NOT TO HAVE REJECTED THE APPLICATION FOR RECTIFICATION UNDER SE CTION 154 OF THE INCOME TAX ACT, 1961. IN VIEW OF THE ABOVE DECISION, WE U PHOLD THE FINDINGS OF THE COMMISSIONER OF INCOME TAX (APPEALS) AT PARA 3. 4 AND 3.5 WHICH IS EXTRACTED FOR READY REFERENCE:- 3.4. I HAVE CONSIDERED THE ORDER OF THE ITO CPC, BANGALORE, REMAND REPORT OF THE ASSESSING OFFICER AND THE SUBM ISSIONS OF THE ASSESSEE AND I FIND CONSIDERABLE MERIT IN THE SUBMI SSION OF THE ASSESSEE THAT THE ITO CPC, BANGALORE IS NOT JUSTIFI ED TO RAISE THE DEMAND AND ALSO REJECT THE RECTIFICATION PETITION U NDER SECTION 154. THE ASSESSING OFFICER ITO WARD 30(1), NEW DELHI IN THE REMAND REPORT AHS ALSO MENTIONED THAT THE ASSESSEE DID NOT FILL UP THE OPENING STOCK DETAILS IN THE E-RETURN AND AS SUCH T HE ASSESSING OFFICER IS NOT JUSTIFIED TO RAISE THE DEMAND AS THE RE WAS A MISTAKE ON THE PART OF THE ASSESSEE NOT TO FILL UP THE OPEN ING STOCK AMOUNT OF RS.52,96,285/- WHICH IS ALSO THE CLOSING STOCK F IGURE OF THE PRECEDING ASSESSMENT YEAR I.E. ASSESSMENT YEAR 2008 -09 AS PER THE AUDITED P&L ACCOUNTS OF THE ASSESSEE. 3.5. AFTER CONSIDERING ALL THE FACTS AND CIRCUMSTAN CES OF THE CASE, I AM OF THE VIEW THAT THERE WAS A MISTAKE OF THE ASSE SSEE NOT TO FILL- UP THE OPENING STOCK DETAILS IN THE E-RETURN BUT TH E ITO CPC, BANGALORE WAS NOT JUSTIFIED TO REJECT THE RECTIFICA TION PETITION UNDER SECTION 154 AND ACCORDINGLY, THE PRESENT ASSESSING OFFICER I.E. THE ITO WARD 30(1), NEW DELHI IS DIRECTED TO EXAMINE TH E CLAIM OF THE ASSESSEE AND RECTIFY THE MISJTAKE AND PASS AN ORDER UNDER SECTION 154 REDRESSING THE GRIEVANCE OF THE ASSESSEE AND AC CORDINGLY, THE APPEAL OF THE ASSESSEE IS ALLOWED. ITA NO. 2514/DEL/2012 PAGE 4 OF 4 ASSESSMENT YEAR 2009-10 SH. MAQBOOL HASAN, NEW DELHI 8. IN THE RESULT WE DISMISS THE APPEAL OF THE REVE NUE. ORDER PRONOUNCED IN THE OPEN COURT ON 29 TH AUGUST, 2012. SD/- SD/- (C.M.GARG) ( J.SUDHAKAR REDDY) JUDICIAL MEMBER ACCOUNTANT MEMBE R DATED: THE 29 TH AUGUST, 2012 *MANGA COPY OF THE ORDER FORWARDED TO: 1. APPELLANT; 2.RESPONDENT; 3.CIT; 4.CIT (A); 5.DR; 6.GUARD FILE BY ORDER DY. REGISTRAR 1. DATE OF DICTATION: 07/8 2. DRAFT PLACED BEFORE THE AUTHOR ON: 27/8 3. DRAFT PROPOSED AND PLACED BEFORE SECOND MEMBER ON: 28/8 4. DRAFT DISCUSSED/APPROVED BY THE SECOND MEMBER ON:28 /8 5. APPROVED DRAFT CAME TO SR.P.S. ON:29/8 6. DATE OF PRONOUNCEMENT :29/8 7. FILE SENT TO BENCH CLERK ON :30/8 8. DATE ON WHICH FILE GIVEN TO HEAD CLERK ON: 9. DATE OF DISPATCHING THE ORDER ON: