Avishkaar Processing Mills (P) Ltd., Surat V. The ACIT, Cent.Circle-1, Surat

ITA 2687/AHD/2006

• Counselvise Citation: [2009] 114 COUNSELVISE.COM (IT) 9270 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 8 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2009
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 20-08-2009
• Assessment Year: 2003-2004
• Appeal Filed On: 06-12-2006
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: C K MISHRA
• Assessee Lawyers: KK SHAH
• Section: 133(6)

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, D-BENCH,AHMED ABAD. BEFORE :SHRI MAHAVIR SINGH, JUDICIAL MEM BER, AND SHRI D.C.AGRAWAL, ACCOUNTANT MEMBER. ITA NO.2687/AHD/2006 (ASSESSMENT YEAR 2003-2004) AVISHKAAR PROCESSING MILLS (P) LTD., 145, GIDC ESTATE, PANDESARA, SURAT. VERSUS ACIT, CENTRAL CIRCLE-4, SURAT. (APPELLANT) (RESPONDENT) PAN: AACCA 0038 P FOR THE APPELLANT: SHRI K.K. SHAH, AR FOR THE RESPONDENT SHRI C.K. MISHRA, DR ORDER PER SHRI D.C. AGRAWAL: THIS IS AN APPEAL FILED BY THE ASSESSEE RAISING FOLLOWING GROUNDS. 1.THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) GROSSLY ERRED IN NOT DELETING THE ADDITION ON ACCOUNT OF ALLEGED NON -GENUINE PURCHASES OF COLOUR CHEMICAL OF RS. 13,21,435/- AS PER PARA 5 OF THE APPEAL ORDER. 2.THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) G ROSSLY ERRED IN RELYING THE STATEMENT OF ROHIT PANWALA WITHOUT HAVI NG CONFRONTED TO THE APPELLANT AND THEREBY ERRED ON RELYING AN EVIDENCE WHICH IS AS GOOD AS NO EVIDENCE IN THE EYES OF LAW. 3.THE APPELLANT RESERVE RIGHT TO ADD, ALTER OR WITH DRAW ANY GROUNDS OF APPEAL. 2. THE FACTS OF THE CASE ARE THAT ASSESSEE COMPANY IS ENGAGED IN THE BUSINESS OF DYING AND PRINTING OF ART SILK CLOTH ON JOB WORK BASIS. THE ASSESSING OFFICER FOUND THAT ASSESSEE HAS MADE CERT AIN PURCHASES OF COLOR AND 2 ITA NO.2687/AHD/2006 (ASSESSMENT YEAR 2003-04) CHEMICALS DURING THE YEAR UNDER CONSIDERATION. HE ISSUED NOTICES UNDER SECTION 133(6) TO VERIFY THE CLAIM OF SUCH PURCHASES. FOLL OWING TWO PARTIES DID NOT SUBMIT ANY REPLY: (I) NALANDA CORPORATION RS. 7,40,185/- (II) NEHA SYNTHETICS RS. 5,81,250/- RS.13,21,435/- 3. THE ASSESSING OFFICER ASKED THE ASSESSEE TO PROD UCE THE ABOVE 2 PARTIES FOR VERIFICATION. THE ASSESSEE EXPRESSED HIS INABI LITY TO PRODUCE THEM ON THE GROUND THAT THOSE PARTIES HAVE CHANGED THEIR ADDRES SES AND THEIR PRESENT ADDRESSES IS NOT KNOWN. BUT, IT WAS SUBMITTED THAT PURCHASES WERE MADE BY BILLS AND PAYMENTS WERE MADE BY ACCOUNT PAY CHEQUES . THE ASSESSING OFFICER FURTHER NOTED THAT A RACKET OF ISSUE OF BOGUS BILLS WAS DONE BY ONE MR. ROHIT PANWALA WHO WAS RUNNING CONCERNS IN THE NAME OF HIS FAMILY MEMBERS. ROHIT PANWALA HAS FURNISHED THE AFFIDAVIT STATING THEREIN THAT HE USED TO ISSUE BOGUS BILLS FOR COLOUR AND CHEMICALS. HE ALSO STATED THA T AGAINST THE CHEQUES RECEIVED BY HIM, CASH WAS WITHDRAWN FROM HIS BANK ACCOUNTS AND WAS RETURNED TO THE PARTIES AFTER DEDUCTING HIS COMMISSION. IT WAS ALS O STATED BY SHRI. ROHIT PANWALA , THAT ABOVE 2 CONCERNS WERE RUN BY HIM. 4. THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) FOR THE SAME REASONS CONFIRMED THE ADDITION. 5. BEFORE US, LEARNED AR FOR THE ASSESSEE SUBMITTED THAT TRIBUNAL HAS IN SIMILAR CASES ALLOWED THE CLAIM OF THE ASSESSEE BY HOLDING THAT ADDITION MERELY ON THE BASIS OF STATEMENT OF SHRI. ROHIT PANWALA WA S NOT JUSTIFIED. FOLLOWING ARE SOME OF THE DECISIONS TAKEN BY AHMEDABAD BENCHE S. 1. AKRUTI DYEING & PRINTING MILLS PVT. LTD. V. ACI T, CIRCLE-1, SURAT (ITA NO. 2551/AHD/2006 AND ITA NO. 2752/AHD/2006 RE LATING TO ASSESSMENT YEAR 2003-04) ORDER DATED 26.10.2007. 2. DADA SILK MILLS V. ITO WARD 2(1), SURAT (ITA NO. 1896/AHD/2007 RELATING TO ASSESSMENT YEAR 2003-04) ORDER DATED 11 .9.2008. 3 ITA NO.2687/AHD/2006 (ASSESSMENT YEAR 2003-04) 3. SHALU DYEING & PRINTING MILLS (P) LTD. (ITA NO.1 491 & 1492/AHD/2008 RELATING TO ASSESSMENT YEARS 2001-02 AND 2002- 03) ORDER DATED 11.07.2008. 4. SMT. SANGITABEN M. PATEL V. ITO WARD 8(4), SURAT (ITA NO.4320/AHD/2007) RELATING TO ASSESSMENT YEAR 1999- 2000) ORDER DATED 29.2.2008. 6. IN THE LEAD CASE OF AKRUTI DYING AND PRINTING, T HE TRIBUNAL HELD AS UNDER: 20. HAVING HEARD THE RIVAL SUBMISSIONS AND PERUSED THE ORDERS OF THE LOWER AUTHORITIES AND THE MATERIALS AVAILABLE ON RE CORD WE FIND THAT A SEARCH OPERATION WAS CARRIED OUT ON SHRI ROH IT PANWALA AND HIS ASSOCIATES AND OTHER PROCEEDINGS WERE ALSO TAKEN AGAINST, THEM WHEREIN SHRI ROHIT PANWALA STATED THA T HE USED TO PROVIDE ACCOMMODATION/FAKE BILLS AT THE REQUEST OF THE PARTIES. ON THE BASIS OF THIS, THE ASSESSING OFFICER HAS TRE ATED THE PURCHASES MADE BY THE ASSESSEE FROM 3 PARTIES WHICH DO NOT INCLUDE ROHIT PANWALA FOR RS.7,21,950/- AS BOGUS. THE ASSESSEE CLAIMED THAT THE PAYMENTS TO THE PARTIES WERE MADE BY ACCOUNT PAYEE CHEQUES AND AGAINST RECEIPT OF GOODS. WE FIN D THAT THE REVENUE HAS BROUGHT NO MATERIAL ON RECORD TO SHOW T HAT THE PURCHASES SHOWN BY THE ASSESSEE, FROM THE AFORESAID 3 PARTIES WERE NOT GENUINE AND WHERE ACCOMMODATION/FAKE BILLS SHOWN BY THE ASSESSEE. NO STATEMENT RECORDED FROM THE ABOVE 3 PARTIES BY THE REVENUE WERE BROUGHT ON RECORD. WE FIND NO MAT ERIAL ON THE BASIS OF WHICH IT CAN BE ALLEGED THAT THE ABOVE PAR TIES ADMITTED THAT THE BILLS RAISED BY THEM AGAINST THE ASSESSEE WERE MERELY ACCOMMODATION BILLS. IN THE ABOVE CIRCUMSTANCES TH E DISALLOWANCE MADE BY THE REVENUE ON THE BASIS OF SU RMISES AND CONJECTURES WITHOUT ANY POSITIVE MATERIAL ON RECORD . THEREFORE, IN OUR CONSIDERED OPINION, THE DISALLOWANCE MADE IS UNSUSTAINABLE. ACCORDINGLY, WE DELETE THE ADDITION MADE AND ALLOW THE GROUND OF APPEAL OF THE ASSESSEE. 7. IN ASSESSEES OWN CASE SIMILAR VIEW WAS TAKEN BY THE TRIBUNAL IN ITA NO. 3589, 3590, 3591/A/2008 FOR THE ASSESSMENT YEAR 2001-02, 2002-03, 2003-04 PRONOUNCED ON 03-07-2009. 4 ITA NO.2687/AHD/2006 (ASSESSMENT YEAR 2003-04) 8. SINCE THE TRIBUNAL IS CONSTANTLY TAKING A VIEW T HAT ADDITION CANNOT BE MADE MERELY ON THE BASIS OF STATEMENT OF ROHIT PANW ALA, RESPECTFULLY FOLLOWING THE ABOVE DECISIONS, WE DELETE THE ADDITION. 9. AS A RESULT, APPEAL FILED BY THE ASSESSEE IS ALL OWED. THIS ORDER IS PRONOUNCED IN OPEN COURT ON DATED 28 TH AUGUST, 2009. SD/- SD/- (MAHAVIR SINGH) (D .C. AGRAWAL) JUDICIAL MEMBER ACCOUN TANT MEMBER AHMEDABAD; DATED: 28/08/2009 ANKIT* COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) CONCERNED 4. THE CIT, 5. THE DR, AHMEDABAD BENCH 6. THE GUARD FILE. BY ORDER, ASSTT. REGISTRAR/ DEPUTY REGISTRAR ITAT, AHMEDABAD BENCHES, AHMEDABAD.