AGROCORPEX INDIA LTD., MUMBAI V. D.C.I.T. CIRCLE 3(1), MUMBAI

ITA 2647/MUM/2012

• Counselvise Citation: 264719914 RSA 2012
• Duration Of Justice: 3 year(s) 4 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-08-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 29-07-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 19-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S P WALIMBE
• Assessee Lawyers: SANJIV M SHAH
• Keywords: Additional evidence; Onus to prove

Judgement Text

A IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER ./ I.T.A. NO. 2647 /MUM/2012 ( / ASSESSMENT YEAR : 2007-08 M/S AGROCORPEX INDIA LTD., 153C, 15 TH FLOOR, MITTAL TOWERS, NARIMAN POINT, MUMBAI 400 021. / VS. DY. COMMISSIONER OF INCOME TAX, CIR. 3(1), AAYAKAR BHAVAN, M.K. ROAD, MUMBAI. ./ PAN : AAACA4466F ( / APPELLANT ) .. ( / RESPONDENT ) A PPELLANT BY SHRI SANJIV M. SHAH R E SPONDENT BY : SHRI S.P. WALIMBE / DATE OF HEARING : 29-07-2015 / DATE OF PRONOUNCEMENT : 20-08-2015 [ !' / O R D E R PER SANJAY GARG, JUDICIAL MEMBER: THIS ASSESSEES APPEAL FOR A.Y. 2007-08, IS DIRECTE D AGAINST THE ORDER OF LD. CIT(A) -5, MUMBAI DATED 02-02-2012. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE CO MPANY IS ENGAGED IN PROCUREMENT AND SALE OF POULTRY EGGS. THE ASSESSEE IS PROCURING EGGS ON DAILY BASIS FROM THE POULTRY FARMERS AND DIRECTLY SELLING THEM TO THE TRADERS. THE ASSESSEE IS ALSO GIVING PURCHASE SUPPORT TO NATIONA L EGGS CO-ORDINATION COMMITTEE AND BHARAT EGG PRODUCERS ASSOCIATION. DUR ING THE RELEVANT ASSESSMENT YEAR, THE ASSESSEE HAD MADE PURCHASES FR OM TOTAL 533 PARTIES. THE A.O. SOUGHT CONFIRMATIONS FROM 147 PARTIES. OUT OF 147 PARTIES, ITA 2647/M/12 2 CONFIRMATION WAS PRODUCED WITH REGARD TO 136 PARTIE S BEFORE THE A.O. THAT, CONFIRMATIONS OF ELEVEN PARTIES WERE NOT AVAILABLE BEFORE THE A.O., THEREFORE, THE A.O. ADDED THE AMOUNT IN RELATION TO PURCHASES MADE FROM THE SAID ELEVEN PARTIES AMOUNTING TO RS. 3,29,07,130/- IN TO THE INCOME OF THE ASSESSEE HOLDING THAT THE PURCHASES IN RESPECT OF T HOSE PARTIES WERE NOT GENUINE. AGGRIEVED AGAINST THE ORDER OF THE A.O., THE ASSESSEE WENT IN APPEAL BEFORE THE LD. CIT(A). BEFORE THE LD. CIT(A), THE A SSESSEE STATED AND PUT FORTH SOME ADDITIONAL EVIDENCES UNDER RULE 46A OF THE I.T . RULES, 1962. THE ASSESSEE, BEFORE THE LD. CIT(A) STATED THAT FROM TH E DETAILS OF PURCHASE AND EVIDENCE FILED, IT CAN BE APPRECIATED THAT THE FARM ERS FROM WHOM THE PURCHASES WERE MADE WERE NOT FROM MUMBAI BUT LOCATE D IN DISTANT VILLAGES OF PUNJAB, ANDHRA PRADESH AND U.P. THAT, THE LD. CIT(A ) ON THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE, CALLED A REMAND REP ORT FROM THE A.O. THE A.O. FILED REMAND REPORT VIDE LETTER DATED 31-1-2012 WHE REIN THE A.O. REPORTED THAT EXCEPT THREE PARTIES, THE PURCHASES WERE FOUND TO BE GENUINE. THE SAID THREE PARTIES WERE RANWA POULTRY FARM, MALKIT SINGH & SURENNDAR SINGH AND SUNDER SINGH & MALKIT SINGH. IN THE REMAND REPORT S UBMITTED BY THE A.O., IT WAS MENTIONED THAT SO FAR AS MALKIT SINGH & SURENND AR SINGH WERE CONCERNED, PROPRIETOR OF THE CONCERN HAD EXPIRED ON 13-01-2008 AND THE ASSESSEE HAD ALSO FURNISHED THE DEATH CERTIFICATE C ONFIRMING THE DEATH OF MR. MALKIT SINGH AND DUE TO THE DEMISE OF THE SAID MR. MALKIT SINGH, NO CONFIRMATION COULD BE OBTAINED. THE SAID MR. MALKIT SINGH, WAS THE MANAGING PERSON OF THE FIRM SUNDER SINGH & MALKIT SINGH ALSO , HENCE AFTER HIS DEATH, THE CONCERN WAS CLOSED AND THUS NO CONFIRMATION COU LD BE OBTAINED. THAT, ONLY IN THE CASE OF RANWA POULTRY FARM, THE ASSESSE E WAS UNABLE TO FILE ANY CONFIRMATION. SINCE THE A.O. IN HIS REMAND REPORT H AD STATED THAT THE CONFIRMATION FROM ABOVE STATED THREE PARTIES WAS NO T AVAILABLE AND, THEREFORE, OUT OF THE ADDITION OF RS. 3,29,07,130/- MADE BY TH E A.O., THE LD. CIT(A) CONFIRMED THE ADDITION TO THE EXTENT OF RS. 3,94,84 7/-. AGGRIEVED BY THE ORDER ITA 2647/M/12 3 OF THE LD CIT(A), THE ASSESSEE IS IN FURTHER APPEAL BEFORE US ON THE GROUND OF THE SAID ADDITION OF RS. 3,94,847/-. 3. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ENTIRE DETAILS ABOUT THE BACKGROUND OF INDIVIDUAL PARTIES, PROOF OF THEI R EXISTENCE, PROOF OF PAYMENTS THROUGH BANK CHANNEL, STOCK MOVEMENT ETC. HAVE BEEN SUBMITTED BEFORE THE DEPARTMENT THAT ALL THE PAYMENTS WERE MA DE THROUGH BANK CHEQUES AND THE ONUS TO PROVE THE GENUINENESS OF TH E PARTIES HAS BEEN DISCHARGED BY THE ASSESSEE BEFORE THE A.O. AND ALSO BEFORE THE LD. CIT(A). THAT, SO FAR AS THE SAID THREE PARTIES WERE CONCERN ED, COPY OF INVOICES FOR SALE OF POULTRY MEDICINES TO THESE CONCERNS WERE SUBMITT ED BY THE ASSESSEE TO PROVE THE EXISTENCE OF THE PARTIES WITH WHOM THE TR ANSACTIONS WERE MADE. THE STATEMENT OF ACCOUNTS WITH DETAILS OF PARTIERS AND PAYMENT, CORRESPONDING SALES MATCHING THE OVERALL QUANTITY OF THE PURCHASE S AND SALES WERE FILED BEFORE THE DEPARTMENT. 4. ON THE OTHER HAND, THE LD. D.R. STRONGLY SUPPORT ED THE ORDERS OF AUTHORITIES BELOW. 5. WE OBSERVE FROM THE FACTS ON RECORD THAT THE ASS ESSEE HAD DONE BUSINESS WITH 533 PARTIES DURING THE RELEVANT ASSES SMENT YEAR. THE A.O. HAD SOUGHT CONFIRMATION FOR THE PURCHASE FROM 147 PARTI ES OUT OF WHICH ONLY ELEVEN PARTIES DID NOT FILE CONFIRMATIONS. THAT, RE GARDING ELEVEN PARTIES, ADDITIONAL EVIDENCE WAS FILED BEFORE THE LD. CIT(A) AND THE LD. CIT(A) HAD CALLED REMAND REPORT FROM THE A.O. WITH REGARD TO THE ELEV EN PARTIES. OUT OF THE ELEVEN PARTIES, THE A.O. REPORTED THE GENUINENESS O F ALL EXCEPT THREE PARTIES, WHOSE CONFIRMATIONS WERE NOT AVAILABLE. HERE, WE AL SO FIND THAT THERE WERE TWO PARTIES NAMELY; MALKIT SINGH & SURENNDAR SINGH & SUNDER SINGH & MALKIT SINGH, OF WHICH THE PROPRIETOR MR. MALKIT SI NG HAD DIED AS EVIDENT FROM THE DEATH CERTIFICATE FILED BEFORE THE A.O. AN D DUE TO THE DEMISE OF MR. MALKIT SINGH, THE ENTIRE BUSINESS HAD STOPPED. THER EFORE, NON-GETTING THE ITA 2647/M/12 4 CONFIRMATION FROM THEM CANNOT BE A GROUND TO SAY TH AT THE ASSESSEE HAD SHOWN IN-GENUINE PURCHASE. ONLY IN RESPECT OF ONE P ARTY I.E., RANWA POULTRY FARM, THE CONFIRMATION WAS NOT AVAILABLE. THEREFORE , IN EFFECT, OUT OF THE TOTAL 533 PARTIES WITH WHOM THE ASSESSEE HAS CONDUCTED BU SINESS, 532 PARTIES WERE FOUND TO BE GENUINE BY THE A.O. THEREFORE, IN ALL PROBABILITY, THE ONE SINGLE PARTY CANNOT ALSO BE SAID TO BE IN-GENUINE. IN THE FINANCIAL TRANSACTIONS, ALL THE QUANTITATIVE DETAILS HAVE BEE N FILED BY THE ASSESSEE, THE TRANSACTIONS WERE DONE THROUGH BANKING CHANNEL, WHI CH ARE NOT AT ALL DISPUTED. THEREFORE, WE FIND THAT THE ONUS TO PROV E THE GENUINENESS OF THE TRANSACTIONS REGARDING PURCHASE HAS BEEN FULLY COMP LIED WITH, WHICH IS EVIDENT ON RECORD. THEREFORE, WE SET ASIDE THE ORDE R OF THE LD. CIT(A) AND DELETE THE ENTIRE ADDITION OF RS. 3,94,847/- AND AL LOW THE APPEAL FILED BY THE ASSESSEE. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 20 TH AUGUST, 2015. !' # $% &! ' 20-08-2015 ( ) SD/- SD/- (G.S. PANNU) (SANJAY GAR G) ACCOUNTANT MEMBER JUDICIAL MEMB ER $ * MUMBAI ; &! DATED 20-08-2015 [ .+../ R.K. R.K. R.K. R.K. , SR. PS ITA 2647/M/12 5 ! '#$% &%# / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. , () / THE CIT(A)- 5, MUMBAI 4. , / CIT- 3 MUMBAI 5. /0( ++12 , 12 , $ * / DR, ITAT, MUMBAI A BENCH 6. (45 6 / GUARD FILE. ' / BY ORDER, / + //TRUE COPY// (/') * ( DY./ASSTT. REGISTRAR) , $ * / ITAT, MUMBAI