Appeal details
Counselvise Citation
[2019] 112 COUNSELVISE.COM (IT) 6859 (ITAT-PUNE)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
1 year(s) 3 month(s) 5 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
28-02-2019
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
B
Assessment Year
2012-2013
Appeal Filed On
23-11-2017
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, PUN E BEFORE SHRI ANIL CHATURVEDI, AM AND SHRI PARTHA SARATHI CHAUDHURY, JM / ITA NO. 2744/PUN/2017 / ASSESSMENT YEAR : 2012-13 M/S. M.B. GHARPURAY ENGINEERS & CONTRACTORS. 838, ANOHAR RESIDENCY, AGARKAR ROAD, SHIVAJI NAGAR, PUNE-411 016. PAN : AACFM4994R ....... / APPELLANT / V/S. THE PR. COMMISSIONER OF INCOME TAX-2, PUNE. / RESPONDENT ASSESSEE BY : SMT. DEEPA KHARE REVENUE BY : SMT. NANDITA KANCHAN / DATE OF HEARING : 26.02.2019 / DATE OF PRONOUNCEMENT : 28.02.2019 / ORDER PER PARTHA SARATHI CHAUDHURY, JM : THIS APPEAL PREFERRED BY THE ASSESSEE EMANATES FROM TH E ORDER OF LD. PR. COMMISSIONER OF INCOME TAX-2, PUNE DATED 30.03.2017 PA SSED U/S.263 OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT). 2 ITA NO. 2744/PUN/2017 A.Y.2012-13 THOUGH THE ASSESSEE HAS FILED MULTIPLE GROUNDS OF APPEAL A ND REVISED GROUNDS OF APPEAL, THE CRUX OF THE GRIEVANCE OF THE ASSES SEE IS WITH REGARD TO THE INVOKING OF JURISDICTION U/S. 263 OF THE ACT BY THE LD . PR. COMMISSIONER OF INCOME TAX. 2. AT THE OUTSET, WE NOTICE THAT THE APPEAL IS TIME-BARR ED BY 137 DAYS FOR WHICH CONDONATION OF DELAY PETITION ALONG WITH AFFIDAVIT HAS BE EN FILED BY THE ASSESSEE. THAT ON PERUSAL OF THESE DOCUMENTS, IT IS EVIDEN T THAT THE DELAY WAS CAUSED DUE TO THE REASONS BEYOND THE CONTROL OF THE A SSESSEE AND MORE SPECIFICALLY, THE ASSESSEE ACTED UPON THE ADVICE OF HIS CON SULTANT AND WHILE ACTING ON ADVICE, THIS PRESENT DELAY HAS OCCURRED. WE HA VE GIVEN THOUGHTFUL CONSIDERATION TO THE CONDONATION OF DELAY PETITION AS WELL A S AFFIDAVIT AND IN ALL JUDICIAL FAIRNESS, WE OBSERVE THAT THE GROUNDS FOR DELAY ARE JUSTIFIED AND THEREFORE, WE CONDONE THE DELAY AND PROCEED TO HEAR THE APPEAL ON MERIT. 3. THE FACTS IN THIS CASE WHICH HAS GIVEN RISE TO THE OR DER PASSED U/S.263 OF THE ACT BY THE LD. PR. COMMISSIONER OF INCOME TAX IS T HAT THE ASSESSMENT WAS COMPLETED U/S.143(3) OF THE ACT AT TOTAL INCOME OF RS.1 ,77,78,593/-. SUBSEQUENT TO THIS, UPON VERIFICATION OF CASE RECORDS, IT WA S SEEN THAT THE ASSESSEE HAD WRITTEN OFF THE SALES TAX REFUND OF RS.10.32 LAKHS AND CLAIMED IT AS AN EXPENSE. IT WAS FURTHER NOTICED THAT THE ASSESSE E HAS WRITTEN OFF WORK CONTRACT TDS OF RS.10,48,049/- AS WELL AND CLAIMED SUCH AM OUNT AS WELL AS AN EXPENSE. THE PR. COMMISSIONER OF INCOME TAX OBSERVED THAT PRIMA FACIE SUCH CLAIMS ARE LEGAL STATUTORY CLAIMS AND CANNOT BE WRITT EN OFF AS BAD DEBTS, THEREFORE, SUCH CLAIMS SHOULD HAVE BEEN ADDED BACK BY TH E ASSESSING OFFICER WHICH HE HAS NOT DONE WHILE PASSING ASSESSMENT ORDER. TH EREFORE, THE NOTICE U/S.263 OF THE ACT WAS ISSUED ON 01.03.2017 TO REVISE THE ABOVE ASSESSMENT ORDER BEING ERRONEOUS, PREJUDICIAL TO THE INTEREST OF THE REVENUE. 3 ITA NO. 2744/PUN/2017 A.Y.2012-13 4. THAT ON PERUSAL OF THE NOTICE ISSUED U/S.263 OF THE A CT WHICH IS ANNEXED AT PAGE NO.1 IN THE PAPER BOOK FILED BEFORE US, IN PARA 3 THEREIN, IT IS MENTIONED THAT : 3. ON VERIFICATION OF CASE RECORD IT IS NOTICED THA T : YOU HAVE MADE A WRONGFUL CLAIM OF RS.24,58,032/- ON ACCOUNT OF WRITING OFF SALES TAX REFUND AND WCT TDS REFUND. 5. THE LD. AR OF THE ASSESSEE AT THE TIME OF HEARING INVIT ED OUR ATTENTION TO PAGE 1 OF THE SECOND PAPER BOOK WHICH CONTAINS COPY OF NOTICE ISSUED U/S.142(1) OF THE ACT DATED 11.08.2014 WHEREIN CERTAIN DETA ILS WERE CALLED FOR FROM THE ASSESSEE INCLUDING COPY OF RETURN OF INCOME ALONG WITH COMPUTATION OF INCOME, AUDITED BALANCE SHEET, TAX AUDIT REPORT, PAN OF ALL THE PARTNERS, CONTACT DETAILS AND 26AS ETC. THIS NOTICE IS SCANNED AND ANNEXED AS A PART OF THIS ORDER AS ANNEXURE -1 . 4 ITA NO. 2744/PUN/2017 A.Y.2012-13 5.1 THE LD. AR OF THE ASSESSEE, THEREAFTER, REFERRED TO P AGE 2 OF THE PAPER BOOK WHEREIN ANOTHER NOTICE WAS ISSUED U/S.142(1) DATED 29.12.2014 ALONG WITH DETAILS QUESTIONNAIRE BY THE ASSESSING OFFICER. IN THAT QUESTIONNAIRE, 5 ITA NO. 2744/PUN/2017 A.Y.2012-13 ITEM NO. 6 REFERS TO DETAILS OF OTHER EXPENSES. THIS NOTICE ALONG WITH QUESTIONNAIRE IS ALSO MADE PART OF THIS ORDER AND ANNEXED HEREIN AS ANNEXURE-2 . 6 ITA NO. 2744/PUN/2017 A.Y.2012-13 5.2 THEREAFTER, THE LD. AR OF THE ASSESSEE REFERRED TO PA GES 25 AND 26 OF THE PAPER BOOK WHICH IS THE REPLY TO THE ASSESSING OFFICE R REGARDING THE BAD DEBTS/ SUNDRY DEBIT BALANCES WHEREIN THE ASSESSEE CAT EGORICALLY STATED THAT SUM OF RS.24.58 LAKHS HAS BEEN WRITTEN OFF BY WAY OF BAD A ND IRRECOVERABLE DEBTS AND SUNDRY DEBIT BALANCES WHICH ARE AS UNDER: SALES TAX REFUND BIHAR RS.10,32,097.62 WORKS CONTRACT TDS RS.10,40,989.00 IN THIS CONNECTION, THE ASSESSEE HAS EXPLAINED EACH OF T HE HEADS I.E. SALES TAX REFUND, BIHAR AND WORKS CONTRACT TDS. 5.3 THE LD. AR OF THE ASSESSEE EMPHASIZED ON THE FACT THAT ALL THESE ENQUIRIES WERE CONDUCTED ADEQUATELY BY THE ASSESSING O FFICER AND ASSESSEE HAS GIVEN REPLY TO EACH OF THE QUERY AS AND WHEN REVE NUE AUTHORITIES HAVE 7 ITA NO. 2744/PUN/2017 A.Y.2012-13 ASKED FOR. THEREFORE, IT IS NOT APPROPRIATE THAT PR. COMMISS IONER OF INCOME TAX ASSUMES REVISIONARY JURISDICTION U/S.263 OF THE ACT ST ATING ASSESSMENT TO BE ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVE NUE. PAGES 25 AND 26 OF THE PAPER BOOK ARE ALSO MADE PART OF THIS ORDER AND ANNEXED HEREIN BELOW AS ANNEXURE-3 AND ANNEXURE-4 : ANNEXURE-3 8 ITA NO. 2744/PUN/2017 A.Y.2012-13 ANNEXURE-4 5.4 THE LD. AR FURTHER POINTED OUT THAT EVEN FOR THE REV ENUE AUDIT QUERY ON THE ISSUE, THEY HAVE NOTIFIED TO THE ASSESSING OFFICER ON THE ISSUE WHICH ARE ANNEXED IN PAGES 17 AND 18 OF THE PAPER BOOK AND ARE MADE PART OF THIS ORDER AS ANNEXURE-5 AND ANNEXURE-6 : 9 ITA NO. 2744/PUN/2017 A.Y.2012-13 ANNEXURE-5 10 ITA NO. 2744/PUN/2017 A.Y.2012-13 ANNEXURE-6 11 ITA NO. 2744/PUN/2017 A.Y.2012-13 5.5. THE LD. AR OF THE ASSESSEE FURTHER SUBMITTED THAT NO ACTION U/S.263 OF THE ACT IS WARRANTED SINCE THE ASSESSING OFFICER COMPLETED ASSESSMENT U/S.143(3) OF THE ACT AFTER CALLING FOR VOLUMINOUS DETAILS OF VAR IOUS ITEMS, DULY CONSIDERING THEM ALONG WITH THE SUBMISSIONS OF THE AS SESSEE AND IT IS NOT THAT ENTIRE RETURN INCOME WAS ACCEPTED BY THE ASS ESSING OFFICER, ASSESSING OFFICER COMPLETED ASSESSMENT AFTER MAKING DISALLOW ANCE OF NEARLY RS.3.41 LAKHS. FURTHER, DETAILS OF SUNDRY DEBIT BALANCES WR ITTEN OFF WERE ALSO CALLED FOR AND SUBMITTED AND QUERIES RAISED THEREON WERE ALSO DULY ANSWERED AND THEN ACCEPTED. IT IS ALSO DEMONSTRATED TH AT QUERIES RAISED BY AUDIT WAS ALSO EXPLAINED BEFORE THE ASSESSING OFFICER. 5.6 THE LD. AR FURTHER RELIED ON THE FOLLOWING DECISIONS: I) CIT VS. VODAFONE ESSAR SOUTH LTD., ITA NO.119/2012, 212 TAXMAN 184 II) DIRECTOR OF INCOME TAX VS. JYOTI FOUNDATION, ITA NO.267/2013, 357 ITR 388 (DELHI) 6. PER CONTRA, THE LD. DR HAS PLACED RELIANCE ON THE ORD ER PASSED BY THE LD. PR. COMMISSIONER OF INCOME TAX U/S.263 OF THE ACT. 7. WE HAVE PERUSED THE CASE RECORD AND HEARD THE RIV AL CONTENTIONS AND HAVE GIVEN THOUGHTFUL CONSIDERATION TO THE JUDICIAL PRONOUN CEMENTS PLACED BEFORE US. AT THE TIME OF HEARING, THE LD. AR OF THE ASSES SEE DEMONSTRATED THAT VIDE NOTICE U/S.142(1) OF THE ACT AND QUESTIONNAIRE ISS UED, DETAILS WITH REGARD TO WRITING OFF SALES TAX REFUND AND WORKS CONTRAC T TDS REFUND WAS CALLED FOR BY THE ASSESSING OFFICER, SPECIFICALLY ITEM-6 IN THE QUESTIONNAIRE CALLING FOR DETAILS OF OTHER EXPENSES. THEREAFTER, THE ASSES SEE HAS ALSO FILED WRITTEN REPLY TO THESE QUERIES AND EXPLAINED IN DETAILS R EGARDING SALES TAX REFUND, BIHAR AND WORKS CONTRACT TDS. WE ALSO OBSERVE EV EN FOR THE AUDIT 12 ITA NO. 2744/PUN/2017 A.Y.2012-13 QUERY, THE ASSESSEE HAS APPRAISED THE MATTER BEFORE TH E ASSESSING OFFICER AND AGAIN ON THE SAME ISSUE THE LD. PR. COMMISSIONER OF INCOM E TAX HAS INVOKED REVISIONARY JURISDICTION U/S. 263 OF THE ACT. THEREFORE, AS ON FACTS, THE ISSUE WAS ADEQUATELY ENQUIRED UPON BY THE ASSESSING OFFICER AN D SIMILARLY, THE REPLY WAS ALSO FURNISHED BY THE ASSESSEE. THAT REGARDING LEGAL ASPECTS ON THE MATTER, WE TAKE G UIDANCE FROM THE DECISION OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. VODAFONE ESSAR SOUTH LTD. (SUPRA.) WHERE IT HAS BEEN HELD THAT THE RECORDS REVEALED THAT THE ASSESSEE WAS SPECIFICALLY QUERIED REGARDING THE NATURE AND CHARACTER OF THE CHARGES INVOLVED. THE HON'BLE HIGH COURT FURTHER HELD THAT IT IS NOT A CASE OF NO ENQUIRY AS SPECIFIC QUERIES WERE MADE BY THE ASSESSING OFFICER AND THOSE WERE DULY REPLIED. IN SUCH CIRCUMSTANCES, LD. PR. COMMISSIONER OF INCOME TAX COULD NOT HAVE VALIDLY EXERCISED REVISIONARY P OWER U/S.263 OF THE ACT AND REVENUES APPEAL WAS DISMISSED. 8. THAT IN THE PRESENT CASE, THE ASSESSEE WAS ADEQUAT ELY ENQUIRED UPON BY THE LD. ASSESSING OFFICER AT THE TIME OF ASSESSMENT ITSE LF AND REPLIES ON THE ISSUE WAS FILED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER AND ALSO AT THE TIME OF AUDIT QUERY. THE LEGAL PERSPECTIVE IS VERY CLEAR TH AT ONCE ASSESSING OFFICER HAS DONE DETAILED QUERY ON THE ISSUE AND THE ASSE SSEE HAS GIVEN REPLY REGARDING THE SAME ON THE SAME ISSUE, THE LD. PR. COMMISS IONER OF INCOME TAX COULD NOT INVOKE JURISDICTION U/S. 263 OF THE ACT. IT IS JUST A CASE OF PLAUSIBLE OPINION BUT IT CANNOT BE SAID THAT ASSESSMENT WA S ERRONEOUS SO AS TO THE PREJUDICIAL TO THE INTEREST OF THE REVENUE. ONCE T HE ASSESSING OFFICER HAS DONE NECESSARY ENQUIRY ON THE MATTER, THE LD. PR. C OMMISSIONER OF INCOME TAX MAY BE OF THE VIEW THAT ENQUIRY SHOULD HAVE BEEN CONDUCTED IN SOME OTHER MANNER. IT IS JUST A QUESTION OF ANOTHER V IEW OF THE MATTER BUT 13 ITA NO. 2744/PUN/2017 A.Y.2012-13 THAT DOES NOT WARRANT THE PR. COMMISSIONER OF INCOME T AX SHOULD INVOKE THE REVISIONARY JURISDICTION U/S.263 OF THE ACT. 9. IN VIEW OF OUR AFORESAID FINDINGS AND EXAMINATION OF THE IS SUE, WE HOLD THAT RESORTING TO REVISIONARY JURISDICTION BY LD. PR. COMMIS SIONER OF INCOME TAX AND CONSEQUENT ORDER PASSED U/S.263 OF THE ACT IN THE CASE OF THE ASSESSEE IS ARBITRARY, UNWARRANTED AND BAD IN LAW AND AC CORDINGLY, WE DIRECT TO QUASH THE ORDER PASSED U/S.263 OF THE ACT. 10. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON 28 TH DAY OF FEBRUARY, 2019. SD/- SD/- ANIL CHATURVEDI PA RTHA SARATHI CHAUDHURY ACCOUNTANT MEMBER JUDICIAL MEMBER / PUNE; / DATED : 28 TH FEBRUARY, 2019. SB !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. THE PR. COMMISSIONER OF INCOME TAX-2, PUNE. 4 . !'# $$%& , ' %& , ()* , / DR, ITAT, B BENCH, PUNE. 5. #+, -. / GUARD FILE. // TRUE COPY // '/ / BY ORDER, $0 %* / PRIVATE SECRETARY ' %& , / ITAT, PUNE. 14 ITA NO. 2744/PUN/2017 A.Y.2012-13 DATE 1 DRAFT DICTATED ON 26 .0 2 .2019 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 27 .0 2 .201 9 SR.PS/PS 3 DRAFT PROPOSED AND PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/JM 5 APPROVED DRAFT COMES TO THE SR. PS/PS SR.PS/PS 6 KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7 DATE OF UPLOADING OF ORDER SR.PS/PS 8 FILE SENT TO BENCH CLERK SR.PS/PS 9 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 10 DATE ON WHICH FILE GOES TO THE A.R 11 DATE OF DISPATCH OF ORDER
