D.C.I.T Cir - 3,kolkata., Kolkata V. M/s Pusha Steels Ltd., Kolkata

ITA 273/KOL/2013

• Counselvise Citation: 27323514 RSA 2013
• Duration Of Justice: 2 year(s) 3 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-06-2015
• Appeal Filed By: Department
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 07-02-2013
• Court: TRIBUNAL
• Department Lawyers: MADHUMALTI GHOSH JCIT LD
• Keywords: Additional evidence; Cost of acquisition; Onus to prove
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL , SMC BENCH, KOLKATA [BEFORE SHRI P. K. BANSAL, AM ] I.T.A NO . 2 73 /KOL/2013 A.Y : 200 8 - 09 D.C.I.T, CIRCLE - 3, KOLKATA VS. M/S. PUSHA STEELS LTD PAN: AACCP 1204C ( APPELLANT) ( RESPONDENT ) FOR THE APPELLANT: SMT. MADHUMALTI GHOSH, JCIT, LD.SR.DR FOR THE RESPONDENT : NONE DATE OF HEARING: 01 - 06 - 2015 DATE OF PRONOUNCEMENT: 01 - 06 - 201 5 ORDER PER SHRI P. K. BANSAL, AM: THIS APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE ORDER OF CIT(A), KOLKATA DATED 23 - 11 - 2012 BY TAKING FOLLOWING GROUNDS OF APPEAL: - 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD.CIT(A) ERRED IN ALLOWING THE RELIEF TO THE EXTENT OF RS.1,14,69,079/ - WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE COMPANY ABSOLUTELY FAILED TO DISCHARGE THE BURDEN OF PROOF THAT THE EXPENSES AMOUNTING TO RS.1,35,14,779/ - WERE INCURRED FOR LAND DEVELOPMENT. 2. THE VI EW OF LD.CIT(A) IS CONTRADICTORY IN ALLOWING THE RELIEF TO THE EXTENT OF R S.1,14,69,079/ - AND DISALLOWING THE BALANCE AMOUNT OF CLAIM R S.20,45,700/ - FOR NON - PRODUCTION OF VOUCHERS WHILE THE ASSESSEE COMPANY COMPLETELY FAILED TO SUBMIT A SINGLE VOUCHERS, BIL LS, OR EVIDENCE TO PROVE THE GENUINENESS OF TOTAL LAND DEVELOPMENT EXPENSES OF RS.1,35,14,779/ - . 3. THAT THE LD.CIT(A) ERRED IN ACCEPTING THE ADDITIONAL EVIDENCE (REGARDING THE POLICE COMPLAINT FOR LOSS OF DOCUMENTS) IN VIOLATION TO RULE 46). 2. INSPITE OF SERVICE OF NOTICE NONE APPEARED ON BEHALF OF THE ASSESSEE. WE, THEREFORE, DECIDED TO DISPOSE OF THE APPEAL ON MERITS AFTER HEARING THE LD.DR. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF SHARE TRADING, FINANCE, INVEST MENT AND MISCELLANEOUS SERVICES. DURING THE YEAR UNDER CONSIDERATION THE ASSESSEE HAS SUFFERED CAPITAL LOSS ON ACCOUNT OF INVESTMENT AMOUNTING OF RS.1,35,14,779/ - . THE AO NOTED THAT THE ASSESSEE HAS SOLD OUT A LAND AND DISCLOSED CONSIDERATION TO THE EXTE NT OF RS.52,62,282/ - AFTER CLAIMING EXPENSES OF RS.1,66,17,779/ - . THUS, THE ASSESSEE HAS SUFFERED CAPITAL LOSS OF RS.1,35,14,779/ - . THE AO CALLED FOR SUBMISSION OF FULL DETAILS/EVIDENCES REGARDING THE AMOUNT OF RS.1,66,17,779/ - . THE AO NOTICED THAT THE ASSESSEE COMPANY ACQUIRED A LAND FROM WEST BENGAL INDUSTRIAL CORPORATION AT A COST OF RS.31,03,000/ - . THE ASSESSEE COMPANY INCURRED RS.1,35,14,779/ - TOWARDS DEVELOPMENT OF SAID LAND TILL 31 - 03 - 0 4 . AFTER 2 ITA NO .2 73 /KOL/2013 - SMC M/S. PUSH A STEELS LTD CONSIDERING THE SALE CONSIDERATION THE ASSESSEE CLA IMED EXPENSES OF RS.1,35,14,779/ - AS SHOWN IN ITS P & L ACCOUNT . HOWEVER, IN THE ABSENCE OF ANY EVIDENCE THE AO DISALLOWED A SUM OF RS.1,35,14,779/ - TOWARDS DEVELOPMENT COST OF LAND . 4. THE ASSESSEE WENT IN APPEAL BEFORE THE LD.CIT(A) . THE LD.CIT(A) HAS REDUCED THE ADDITION BY OBSERVING AS UNDER: - AFTER CAREFUL CONSIDERATION OF THE ASSESSMENT ORDER AND THE WRITTEN SUBMISSION OF THE ASSESSEE COMPANY IT IS NOTICED THAT THE ASSESSEE COMPANY SOLD LAND AT SALE CONSIDERATION OF RS.52,72,382/ - IN THE FINANCIAL YEAR UNDER CONSIDERATION. THE ASSESSEE HAD ACQUIRED LAND FROM WEST BENGAL INDUSTRIAL CORPORATION AT A COST OF RS.31,03,000/ - ON 11.01.1995 AND HAD INCURRED DEVELOPMENT COST ON THIS LAND FOR RS.1,35,14,779/ - AS ON 31.03.2004 WHICH WAS CAPITALIZED IN THE FY 2003 - 04 AND THE LOSS OF RS.1,13,45,497/ - WAS CLAIMED AS CAPITAL LOSS AND ASSESSEE DID NOT CLAIM THE BENEFIT OF INDEXATION FROM THE COST OF ACQUISITION. THE AO DISALLOWED A SUM OF RS.1,35,14,779/ - SINCE THE ASSESSEE COULD NOT PRODUCE THE SUPPORTING VOUCHE RS AND LONG TERM CAPITAL LOSS AFTER INDEXATION OF THE LAND COST OF RS.13,29,081/ - WAS ALLOWED TO BE CARRIED FORWARD BY THE AO. THE ASSESSEE HAD PRODUCED COPY OF THE COMPLAINT DATED 22.07.2006 REGARDING LOSS OF BOOKS AND DOCUMENTS BEFO R E POLICE AUTHORITIES DURING SHIFTING REGISTERED OFFICE AND PRODUCED 143(3) ORDERS ALONG WITH PROFIT & LOSS FOR THESE AY(S) 1996 - 97 AND 1997 - 98. DURING SCRUTINY ASSESSMENT WORK - IN - PROGRESS AS ON 31 - 03 - 1997 FOR RS.1,14,69,079/ - WAS ACCEPTED BY THE AO U/S.143(3) AND WORK - IN - PROGR ESS AS ON 31 - 03 - 1998 WAS FOR RS.1,47,47,982/ - . OUT OF WHICH RS.1,35,14,779/ - WAS CAPITALIZED IN THE YEAR 2004. KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES THE CLAIM OF EXPENSES INCURRED ON ACCOUNT OF IMPROVEMENT OF LAND SHOULD BE ACCEPTED BY THE AO TO THE EXTENT OF RS.1,14,69,079/ - SINCE THE BILLS AND VOUCHERS RELATING TO COST OF IMPROVEMENT WERE ACCEPTED IN THE ASSESSMENT COMPLETED FOR AY 1996 - 97 AND 1997 - 98 U/S. 143(3) AND THE BALANCE CLAIM OF LOSS FOR RS.1,35,14,779/ - MINUS RS.1,14,69,079/ - = RS.20,45, 700/ - IS DISALLOWED FOR NON PRODUCTION OF VOUCHERS. 5 . AFTER HEARING THE LD. DR AND GOING THROUGH THE ORDERS OF THE TAX AUTHORITIES, I NOTED THAT THE LD.CIT(A) ON THIS ISSUE HAS G IVEN A FINDING THAT THE AO HAS ACCEPTED THE ASSESSMENT COMPLETED U/S. 14 3(3) FOR THE A.YS. 1996 - 97 AND 1997 - 98 . THEREFORE, HE REDUCED THE ADDITION TO THAT EXTENT AND BALANCE ADDITION OF RS.20,45,700/ - CONFIRMED. WE FIND SUBSTANCE IN THE SUBMISSION OF THE LD.DR THAT THE ASSESSEE HAS FILED FRESH EVIDENCE BEFORE THE LD.CIT(A) I N THE FORM OF BALANCE SHEET AND COPY OF ASSESSMENT ORDERS FOR THE AYS. 1996 - 97 & 1997 - 98. THE LD.CIT(A) DID NOT CALL FOR ANY REMAND REPORT EVEN FOR VERIFICATION OF THE BALANCE SHEET AS WELL AS THE ASSESSMENT ORDERS FROM THE AO , BUT ALLOWED THE RELIEF TO THE ASSESSEE. I, THEREFORE, IN THE INTEREST OF JUSTICE AND FAIR PLAY SET ASIDE THE ORDER OF THE LD.CIT(A) AND RESTORE THE ISSUE TO THE FILE OF THE AO WITH THE DIRECTION THAT THE AO SHALL VERIFY WHETHER THE WORK - IN - PROGRESS OF RS.1,14,69,079/ RS.1,47,47,98 2/ - FOR THE A.Y S. 1996 - 97 & 1997 - 98 HAS BEEN ACCEPTED BY THE 3 ITA NO .2 73 /KOL/2013 - SMC M/S. PUSH A STEELS LTD AO WHILE FRAMING THE ASSESSMENT S FOR THE AY S. 1996 - 97 & 1997 - 98 U/S. 143(3) OF THE ACT. AFTER VERIFYING THE SAME, THE AO IS DIRECTED TO DELETE TH E ADDITION SO CONFIRMED BY THE LD.CIT(A) . 6. IN T HE RESULT, THE APPEAL OF REVENUE IS ALLOWED FOR STATISTICAL PURPOSE AS STATE ABOVE . ORDER IS PRONOUNCED IN THE OPEN COURT ON 01 - 06 - 2015 SD/ - ( P. K. BANSAL ) ACCOUNTANT MEMBER DATED : 01 - 06 - 2015 **PRADIP (SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1 . APPELLANT - DCIT, CIR - 3, CHOWRINGHEE SQ, AAYKAR BHAWAN, KOL - 69. 2 RESPONDENT M/S. PUSHA STEELS LTD 37 SHAKESPEARE SARANI, KOL - 17. 3 . THE CIT(A) CONCER NED 4. 5. THE CIT CONCERNED THE D . R 6. GUARD FILE TRUE COPY, BY ORDER ASSTT. REGISTRAR