Appeal Details
Counselvise Citation
[2015] 140 COUNSELVISE.COM (IT) 94734 (ITAT-AHMEDABAD)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
4 year(s) 1 month(s) 2 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
27-11-2015
Appeal Filed By
Department
Order Result
Dismissed
Bench Allotted
D
Next Hearing Date
24-11-2015
Assessment Year
2008-2009
Appeal Filed On
25-10-2011
Judgement Text
, IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ./ ITA NO. 2682/AHD/2011 / ASSESSMENT YEAR: 2008-09 ITO, WARD-2(1), BHAVNAGAR .. APPELLANT VS SHRI MUKESHKUMAR DHARAMDAS MULANI, GOL BAZAR, BHAVNAGAR .. RESPONDENT PAN : ADTPM 9886 E REVENUE BY : SHRI SANTOSH KARNANI , SR.DR ASSESSEE(S) BY : NONE / DATE OF HEARING 24/11/2015 /DATE OF PRONOUNCEMENT 27/11/2015 / O R D E R PER SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER: THIS APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-X X, AHMEDABAD DATED 18.08.2011 FOR ASSESSMENT YEAR 2008 -09, ON THE FOLLOWING GROUNDS:- 1. THE LD. CIT(A)-XX, AHMEDABAD HAS ERRED IN LAW AND O N FACTS IN DELETING THE ADDITION OF RS.35,02,430/- ON ACCOU NT OF SUPPRESSION OF SALES. 1.2 THE DECISION OF THE LD. CIT(A) IS NOT ACCEPTAB LE ON FACTS AS THERE IS DIVERSION OF SALES AND INCOME THEREFROM. ITA NO. 2682/AHD/2011 ITO VS SHRI MUKESHKUMAR DHARAMDAS MULANI AY 2008-09 - 2 - 2. IT IS, THEREFORE, PRAYED THAT THE ORDER OF THE C IT(A) BE SET- ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED TO THE ABOVE EXTENT. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS PROPRIETOR OF M/S. MUKESHKUMAR DHARMADAS MULANI AND IS DERIVING INCOME FROM BUSINESS. THE CASE OF THE ASS ESSEE WAS SELECTED FOR SCRUTINY ASSESSMENT AND DURING THE COU RSE OF THE SCRUTINY, THE ASSESSEE PRODUCED ALL BOOKS OF ACCOUN TS AS WELL AS THE RELEVANT PURCHASE BILLS. THE ASSESSING OFFI CER HAS NOT ACCEPTED THE SUBMISSION GIVEN BY THE ASSESSEE AND H E MADE AN ADDITION OF RS.35,02,430/- TREATING THE SUM AS UNEX PLAINED BUSINESS INCOME OF THE ASSESSEE. THE ISSUE WAS DIS CUSSED BY THE AO AT PARA-2 TO 2(I) IN THE ASSESSMENT ORDER. THE MATTER WAS CARRIED IN APPEAL BEFORE THE FIRST APPELLATE AU THORITY WHEREIN VARIOUS CONTENTIONS WERE RAISED BY THE ASSE SSEE, WHICH READS AS UNDER:- 'THE APPELLANT IS PROPRIETOR OF M/S. MUKVSHKUMAR DHARAMDAS MULANI AND HE IS TRADING IN RETAIL TEA BU SINESS. HE PURCHASES THE TEA BAG FROM VARIOUS PARTIES AND T HEN AFTER HE MIXES TEA AND THEN REPACK THE TEA TO TEN G RAM TO ONE KG. PACK AND SATE IN THE RETAIL BUSINESS. NOTIC E U/S. 143(2) OF THE INCOME TAX ACT WAS ISSUED ON 20/08/20 09 AND SERVED TO ASSESSES, ON 03/09/2009 AND THEN AFTE R NOTICE U/S 142(1) DATED 09-06-2010. THE CASE WAS SE LECTED UNDER CASS BECAUSE OF DURING THE YEAR IS A CASH DEP OSITED IN THE HANK ABOVE 10,00,000 M THE ICICI BANK LTD. FOR THIS APPELLANT HAS SUBMITTED WRITTEN REPLY WITH SAT ISFACTORY EXPLANATION TO THE ASSESSING AUTHORITY AFTER THE VE RIFICATION OF THE BANK STATEMENT AND CASH BOOK AND EACH ENTRY HAS BEEN VERIFIED BY THE ASSESSING AUTHORITY. DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS THE APPELLANT SUBMITTED ALL THE DETAILS AS PER INQUIRED BY THE ITA NO. 2682/AHD/2011 ITO VS SHRI MUKESHKUMAR DHARAMDAS MULANI AY 2008-09 - 3 - ASSESSING AUTHORITY. AFTER SUBMITTING AIL THE DETAI LS THE ASSESSING AUTHORITY ISSUED A SHOW CAUSE NOTICE DATE D 23- 11-2010 AND IN THE SHOW CAUSE NOTICE THE ASSESSING AUTHORITY ESTIMATED VALUATION OF CLOSING STOCK AT @ 206/- PER KG INSTEAD OF @ 61.60 AND SAID THAT THE ASSESSE E HAS CONCEALED THE INCOME OF RS.10,17,126/- AND SHOULD B E ADDED IN THE ASSESSE'S INCOME. AND ALSO WHY THE BOO K RESULT DECLARED BY THE ASSESSED SHOULD NOT BE REJEC TED U/S. 145 OF IT ACT. IN THE REFERENCE OF THE ABOVE SAID S HOW CAUSE NOTICE. THE APPELLANT SUBMITTED HIS DETAIL LETTER T O THE ASSESSING AUTHORITY ON 24-11-201. IN THE REPLY THE ASSESSEE SUBMITTED MONTHLY STOCK STATEMENT AS WELL AS ALL XEROX COPIES OF PURCHASES MADE BY THE ASSESSES MADE DURING THE YEAR. AND ALSO SUBMITTED ANNUAL SALES TA X RETURN IN WHICH THE ALL STOCK STATEMENT HAS BEEN GI VEN TO THE SALES TAX DEPARTMENT. WHATEVER EXPLANATION GIVE N BY THE APPELLANT IT IS NOT ACCEPTED BY THE ASSESSING A UTHORITY AND HE JUMPED LO THE VALUATION OF CLOSING STOCK AT RS. @206 PER KG. LOOKING TO THE APPELLANT'S TURNOVER VALUE T AKEN BY THE ASSESSING AUTHORITY OF THE CLOSING STOCK IS FAT FROM THE TRUTH BECAUSE THE APPELLANT HAS ALREADY SUBMITTED A LL PURCHASE BILL BEFORE THE ASSESSING AUTHORITY IN WHI CH PURCHASE AVERAGE OF TEA RATE IS 36 TO 65. DURING THE YEAR THERE IS NO BILL OF RS.206 HOW THE ASSESSING AUTHORITY APPLY THE RATE OF 206 - THERE I S NO REASON GIVEN BY THE ASSESSING AUTHORITY THE ONLY ON THE CALCULATION OF THE PURCHASE AND SALE HE TAKEN THE R ATE @ 206 THAT IS ILLEGAL AND UNJUSTIFIED. THE APPELLANTS BOOKS ARE AUDITED SINCE LAST SO MAN Y YEARS AND APPELLANT MAINTENANCE REGULARLY MONTHLY S TOCK STATEMENT AND IT IS ALSO SUBMITTED TO ASSESSING AUT HORITY AND IT IS ALSO MENTION IN THE AUDIT REPORT AND IT S HOULD BE ACCEPTED. LOOKING TO THE ABOVE SAID CIRCUMSTANCES, THE APPELL ANT PRAYS THAT THE ADDITION MADE BY THE ASSESSING AUTHO RITY MAY BE DELETED TO KINDLY GIVE THE DIRECTION TO THE ASSESSING AUTHORITY TO VERIFY THE STOCK STATEMENT AND THEN GI VE THE RELIEF TO THE ASSESSEE. ITA NO. 2682/AHD/2011 ITO VS SHRI MUKESHKUMAR DHARAMDAS MULANI AY 2008-09 - 4 - 2.1 IN THIS BACKGROUND, THE LD. CIT(A), HAVING CONS IDERED THE SUBMISSIONS OF THE ASSESSEE, GRANTED RELIEF TO THE ASSESSEE AND THE SAME HAS BEEN OPPOSED BY THE LD. DR ON BEHALF O F THE REVENUE INTER ALIA SUBMITTING THAT THE CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.35,02,430/- ON ACCOUNT OF SUPPRESSION OF SALES AND ACCORDINGLY, THE LD.DR, SU BMITTED THAT THE ORDER OF CIT(A) BE SET ASIDE AND THAT OF A SSESSING OFFICER ON THIS ISSUE BE RESTORED. NONE APPEARED F OR ASSESSEE. SO, THE MATTER IS BEING DECIDED ON THE BASIS OF ARG UMENTS OF LD. DEPARTMENTAL REPRESENTATIVE AND MATERIAL ON RECORD. 2.2 AFTER GOING THROUGH THE RIVAL SUBMISSIONS AND M ATERIAL AVAILABLE ON RECORD, WE FIND THAT THE ASSESSING OFF ICER HAS MADE THE IMPUGNED ADDITION OF RS.35,02,430/- ON ACC OUNT OF SUPPRESSION OF SALES. THE ASSESSING OFFICER OBSERVE D THAT THE CASH DEPOSITS MADE BY THE ASSESSEE IN THE BANK ACCO UNT WITH ICICI BANK LTD. AMOUNTING TO RS.35,02,430/- WAS ON ACCOUNT OF SALES MADE BY THE ASSESSEE. IN FACT, AFTER REJ ECTING THE CONTENTION OF THE ASSESSEE, THE ASSESSING OFFICER W ORKED OUT SUPPRESSION OF SALES OF RS.1.59 CRORES AND FINALLY ENDED UP IN MAKING THE ADDITION OF THE CASH DEPOSITED IN THE BA NK ACCOUNT AS REFERRED TO ABOVE. THE ASSESSING OFFICER HAS NOT SUBSTANTIATED HIS FINDING WITH REGARD TO THE CASH D EPOSITS IN THE BANK AND SUPPRESSION OF SALES. WE FIND THAT CI T(A), WHILE DELETING THE IMPUGNED ADDITION MADE BY THE ASSESSIN G OFFICER, HAS GIVEN A FINDING THAT THE EXPLANATION OF THE ASS ESSEE WITH REGARD TO STOCK VALUATION WAS REJECTED BY THE AO WI THOUT MENTIONING ANY DEFECTS IN THE BOOKS OF ACCOUNT AS THE SALES WERE ESTIMATED AND SUPPRESSION OF SALES WERE WORKED OUT AND ITA NO. 2682/AHD/2011 ITO VS SHRI MUKESHKUMAR DHARAMDAS MULANI AY 2008-09 - 5 - WITHOUT ANY LINKING OF SUPPRESSION OF THE SALES TO THE DEPOSITS IN CASH. CIT(A) HAS RIGHTLY OBSERVED THAT THE APPR OACH THE ASSESSING OFFICER AS REFERRED TO ABOVE WAS NOT JUST IFIED. THEREFORE, WE DO NOT SEE ANY REASON TO INTERFERE WI TH THE ORDER OF THE CIT(A), SAME IS HEREBY UPHELD. THUS, GROUND RAISED BY THE REVENUES APPEAL IS REJECTED. 3. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE COURT ON 27TH OF NOVEMBER, 2015 AT AHMEDABAD. SD/- SD/- ( RAJESH KUMAR ) ACCOUNTANT MEMBER ( S HAILENDRA KUMAR YADAV ) JUDICIAL MEMBER AHMEDABAD; DATED 27/11/2015 *BT / COPY OF THE ORDER FORWARDED TO : 1. '# / THE APPELLANT 2. $%'# / THE RESPONDENT. 3. && ' / CONCERNED CIT 4. ' ( ) / THE CIT(A), 5. ()* $++ , , / DR, ITAT, AHMEDABAD 6. *, / GUARD FILE. / BY ORDER, //TRUE COPY// / (DY./ASSTT.REGISTRAR) ! , / ITAT, AHMEDABAD
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