M/s. Swagruha Shelters, Hyderabad V. ITO,Ward 6(4), Hyderabad

ITA 263/HYD/2014

• Counselvise Citation: 26322514 RSA 2014
• Duration Of Justice: 7 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-09-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 21-02-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B RAMA KRISHNA
• Assessee Lawyers: A V RAGHURAM
• Keywords: Additional evidence
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND SMT. P. MADHAVI DEVI, JUDICIAL MEMBER ITA NO. 263/HYD/2014 ASSESSMENT YEAR 2009-10 M/S. SWAGRUHA SHELTERS HYDERABAD PAN: AAWFS8265M VS THE INCOME TAX OFFICER WARD-6(4) HYDERABAD APPELLANT RESPONDENT APPELLANT BY: S RI A.V. RAGHURAM RESPONDENT BY: SRI B. RAMA KRISHNA DATE OF HEARING: 24 .0 9 .2014 DATE OF PRONOUNCEMENT: 2 4 .0 9 .2014 ORDER PER P. MADHAVI DEVI, JM: THIS IS AN ASSESSEE'S APPEAL FOR ASSESSMENT YEAR 2009-10 DIRECTED AGAINST THE ORDER OF CIT(A)-IV, HYDERABAD DATED 13.12.2013. 2. IN THIS APPEAL, THE ASSESSEE IS AGGRIEVED BY THE ORDER OF THE CIT(A) IN CONFIRMING THE ORDER OF THE ASSESSING OFFICER BY REFUSING TO ENTERTAIN THE EVID ENCE PRODUCED BY THE ASSESSEE HOLDING IT TO BE ADDITIONA L EVIDENCE AND ALSO THAT THE ASSESSEE WAS GIVEN SUFFI CIENT OPPORTUNITY BY THE ASSESSING OFFICER. THE ASSESSEE IS ALSO AGGRIEVED BY THE ORDER OF THE CIT(A) IN CONFIRMING THE ADDITION MADE BY THE ASSESSING OFFICER. 2 ITA NO. 263/HYD/2014 M/S. SWAGRUHA SHELTERS =================== 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE, WHIC H IS A PARTNERSHIP FIRM, ENGAGED IN THE BUSINESS OF P ROPERTY DEVELOPMENT HAD FILED ITS RETURN OF INCOME FOR A.Y. 2009- 10 ON 26.9.2009 DECLARING TOTAL INCOME OF RS. 4,38, 460. THE CASE WAS TAKEN UP FOR SCRUTINY BY ISSUANCE OF N OTICE U/S. 143(2) OF INCOME-TAX ACT, 1961. THE ASSESSEE DID NOT APPEAR BEFORE THE ASSESSING OFFICER NOR DID IT FURN ISH ANY INFORMATION CALLED FOR BY THE AO. THE AO, THEREFOR E, ISSUED FURTHER NOTICES AND SINCE THERE WAS NO COMPL IANCE BY THE ASSESSEE, ASSESSING OFFICER COMPLETED ASSESS MENT U/S. 144 OF THE IT ACT AND TREATED THE EXPENDITURE OF RS. 48,65,248 CLAIMED TOWARDS COMMISSION AS INCOME OF T HE ASSESSEE BY HOLDING THAT NO NEXUS COULD BE ESTABLIS HED FOR INCURRING SUCH HUGE EXPENDITURE TO EARNING OF I NCOME. HE ALSO MADE AN ADDITION OF RS. 12,02,387 BY DISALL OWING OFFICE EXPENSES AND BROUGHT THE SAME TO TAX. 4. AGGRIEVED, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A) AND FURNISHED THE BOOKS OF ACCOUNT SUCH AS CASH BOOK, SALES LEDGER, SITE AND OTHER EXPENSES AC COUNT, ADVANCE COMMISSION LEDGER ACCOUNT AND TDS RETURN FI LED FOR FY 2008-09. THE CIT(A) TREATED THE EVIDENCE FI LED BY THE ASSESSEE AS ADDITIONAL EVIDENCE HOLDING THAT IN SPITE OF SUFFICIENT OPPORTUNITY GIVEN BY THE AO, ASSESSEE HAS FAILED TO COMPLY WITH THE NOTICES OF THE ASSESSING OFFICER AND THE ASSESSING OFFICER WAS CONSTRAINED TO COMPLE TE THE ASSESSMENT EX-PARTE. THEREFORE, HE DID NOT ADMIT TH E EVIDENCE PRODUCED BY THE ASSESSEE. THEREAFTER, THE CIT(A) CONFIRMED THE DISALLOWANCES MADE BY THE ASSESSING OFFICER. AGGRIEVED, THE ASSESSEE IS IN SECOND APPE AL BEFORE US. 3 ITA NO. 263/HYD/2014 M/S. SWAGRUHA SHELTERS =================== 5. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE EVIDENCE FILED BEFORE THE CIT(A) WAS ONLY BOOKS OF ACCOUNT WHICH CANNOT BE CONSIDERED AS ADDITIONAL EVIDENCE AND THE CIT(A) OUGHT TO HAVE CONSIDERED TH E SAME BEFORE CONFIRMING THE DISALLOWANCES MADE BY TH E ASSESSING OFFICER. HE SUBMITTED THAT THE ISSUE NEE DS TO BE RECONSIDERED BY THE AUTHORITIES BELOW IN VIEW OF THE EX- PARTE ASSESSMENT AND NON-CONSIDERATION OF BOOKS OF ACCOUNT OF THE ASSESSEE. 6. THE LEARNED DR, ON THE OTHER HAND, SUBMITTED THAT THE ASSESSEE HAS NOT COMPLIED WITH THE NOTICES ISSU ED BY THE AO ON ALMOST 5 DIFFERENT DATES AND, THEREFORE, THE ASSESSEE CANNOT PLEAD THAT THE ASSESSMENT WAS DONE EX- PARTE. HE SUBMITTED THAT THE ASSESSEE IS REQUIRED TO COMPLY WITH THE NOTICES ISSUED BY THE ASSESSING OFF ICER AND FOR FAILURE TO DO SO, ASSESSMENT U/S. 144 IS JU STIFIED. 7. HAVING REGARD TO THE RIVAL CONTENTIONS AND MATERIAL ON RECORD, WE FIND THAT THE ASSESSING OFFICER HAS I SSUED NOTICES TO THE ASSESSEE, SOME OF WHICH SEEM TO HAVE BEEN RECEIVED BY THE ASSESSEE BUT HAVE NOT BEEN RESPONDE D TO BY THE ASSESSEE AND THE EXPLANATION GIVEN BY THE AS SESSEE FOR THE SAID FAILURE HAS NOT BEEN ACCEPTED BY THE C IT(A). FURTHER, WE FIND THAT THE EVIDENCE FILED BY THE ASS ESSEE BEFORE THE CIT(A) IS ONLY BOOKS OF ACCOUNT AND, THE REFORE, CANNOT BE CONSIDERED AS ADDITIONAL EVIDENCE AS HELD BY THE CIT(A) AND OUGHT TO HAVE BEEN CONSIDERED BEFORE CONCLUDING THE APPELLATE PROCEEDINGS. HOWEVER, THE BOOKS ALSO NEED VERIFICATION BY THE AO. IN VIEW OF THE SAME, WE DEEM IT FIT AND PROPER TO SET ASIDE THE ASSESSMENT ORDER AND REMIT THE ISSUE BACK TO THE FI LE OF 4 ITA NO. 263/HYD/2014 M/S. SWAGRUHA SHELTERS =================== THE ASSESSING OFFICER FOR DE-NOVO CONSIDERATION WITH A DIRECTION TO THE ASSESSEE TO CO-OPERATE WITH THE AS SESSING OFFICER IN THE CONCLUSION OF THE ASSESSMENT PROCEED INGS AT THE EARLIEST. THIS REMITTANCE IS SUBJECT TO THE CO NDITION THAT THE ASSESSEE SHALL PAY A SUM OF RS. 1000 TO TH E DEPARTMENT AS COSTS FOR NON-COMPLIANCE WITH THE NOT ICES ISSUED. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FO R STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 24 TH SEPTEMBER, 2014 SD/ - (P.M. JAGTAP) ACCOUNTANT MEMBER SD/ - (P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD, DATED THE 24 TH SEPTEMBER, 2014 TPRAO COPY TO: 1. M/S. SWAGRUHA SHELTERS, C/O. M/S. K. VASANTKUMAR & A.V. RAGHURAM, ADVOCATES, 610, 6 TH FLOOR, BABUKHAN ESTATE, BASHEERBAGH, HYDERABAD-1. 2. THE INCOME TAX OFFICER, WARD - 6(4), I.T. TOWERS, MASAB TANK, HYDERABAD-500 004. 3. THE CIT(A) - IV, HYDERABAD. 4. THE CIT - III, HYDERABAD. 5 . THE DR, A - BENCH, ITAT, HYDERABAD.