Shri Bijal Dhiman Vyas, Ahmedabad V. The Dy.CIT, Circle-10, Ahmedabad

ITA 2784/AHD/2014

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 0545 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 10 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 09-08-2019
• Assessment Year: 2010-2011
• Appeal Filed On: 17-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S N DIVATIA
• Keywords: Unexplained cash credit; Gift; Depreciation; TDS
• Section: 143(3); 68

Judgement Text

, B IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD BEFORE SHRI MAHAVIR PRASAD, JUDICIAL MEMBER &SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ./I.T.A. NO. 2784/AHD/2014 ( / ASSESSMENT YEAR: 2010-11) BIJAL DHIMAN VYAS PROP. OF AQUA MASTER CLEAN 44, PARANKUNJ FLATS BALAM DAIRY LANE, AMBAWADI, AHMEDABAD- 380006 / VS. DCIT CIRCLE-10, AHMEDABAD- 380009 ./ ./PAN/GIR NO. : ABZ PV7 365 D ( /APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI S. N. DIVATIA, AR / RESPONDENT BY: SHRI MUDIT NAGPAL, SR. DR ! /DATE OF HEARING 09/08/2019 '# ! / DATE OF PRONOUNCEMENT 16/09/2019 $% /O R D E R PER AMARJIT SINGH - AM: THE APPEAL FILED BY THE ASSESSEE FOR A.Y. 2010-11, ARISE FROM ORDER OF THE CIT(A)-XVI, AHMEDABAD DATED 25.08.2014, IN PROCEEDIN GS UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. 2. THE FACT IN BRIEF IS THAT THE ASSESSMENT U/S. 143 (3) OF THE ACT WAS PASSED ON 01.03.2013. THE AO HAS MADE VARIOUS DISALLOWANCE AN D TOTAL INCOME WAS ASSESSED AT RS. 76,11,303/- AS AGAINST RETURN OF IN COME OF RS. 22,00,500/- FILED BY THE ASSESSEE. ITA NO. 2784/AHD/2014 [BIJAL DHIMAN VYAS VS. DCIT] A.Y. 2010-11 2 3. AGGRIEVED ASSESSEE HAS FILED BEFORE THE LD. CIT(A ). THE LD. CIT(A) HAS DISMISSED THE APPEAL OF THE ASSESSEE. 4. THE ASSESSEE HAS RAISED SEVEN ISSUES IN THE GROUN D APPEAL. DURING THE COURSE OF APPELLATE PROCEEDING BEFORE US THE LD. COU NSEL HAS NOT PRESSED GROUND NO. 4 TO 7 BRIEFLY DISALLOWANCE OF TELEPHONE EXPENS ES, VEHICLE EXPENSES, DEPRECIATION OF CAR AND GIFT EXPENSES. THEREFORE, T HE GROUND OF APPEAL FILED ON ABOVE FOUR ISSUES STAND DISMISSED. THE REMAINING T HREE GROUND OF APPEAL TO BE ADJUDICATED ARE ON THE FOLLOWING ISSUES: (I) DISCREPANCY IN CONTRACT RECEIPT (II) UNEXPLAINED CASH CREDIT OF RS. 8,00,000/- (III) DISALLOWANCE OUT OF LABOUR EXPENSES OF RS. 33 ,19,460/-. DURING THE COURSE OF ASSESSMENT THE AO NOTICED THA T ASSESSEE HAS SHOWN RS. 6,53,44,578/- AS CONTRACT RECEIPT, HOWEVER, AS PER FORM NO. 26AS THE GROSS CONTRACT RECEIPT WAS SHOWN AT RS. 6,62,87,189/-. TH E AO HAS STATED THAT ASSESSEE HAS NEITHER FURNISHED ANY DETAIL NOW ANY RECONCILIA TION THEREFORE, DIFFERENCE OF RS. 9,42,611/- INCLUDING RECEIPT OF INTEREST FROM BANK OF INDIA AMOUNTING TO RS. 52,914/- WAS ADDED TO THE TOTAL INCOME OF THE ASSES SEE. REGARDING ADDITION OF RS. 8,00,000/- UNDER THE HEAD UNEXPLAINED CASH CREDIT, THE AO NOTICED THAT ASSESSEE HAS CLAIMED AN AMOUNT OF RS. 8,00,000/- AS UNEXPLAI NED LOAN FROM RATHI SIR. THE AO HAS DISALLOWED THE SAME AS UNEXPLAINED CASH CRED IT U/S. 68 OF THE ACT ON THE GROUND THAT ASSESSEE HAS FAILED TO FURNISH COMPLETE DETAILS AND EXPLANATION IN SUPPORT OF HER CLAIM. IN RESPECT OF DISALLOWANCE O UT OF LABOUR EXPENSES OF RS. 33,19,460/- THE AO NOTICED THAT ASSESSEE HAS PAID R S. 4,24,41,725/- TOWARDS LABOUR EXPENSE WITHOUT DEDUCTION OF TAX AND THE ASSESSEE H AS NOT SUBMITTED SUPPORTING VOUCHER IN RESPECT OF INCURRING OF LABOUR EXPENSES. THEREFORE, THE AO HAS DISALLOWED 10% OF THE LABOUR EXPENSES TO THE AMOUNT OF RS. 93,19,460/- AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. ITA NO. 2784/AHD/2014 [BIJAL DHIMAN VYAS VS. DCIT] A.Y. 2010-11 3 5. THE LD. CIT(A) HAS DISMISSED THE APPEAL OF THE ASSESSEE. 6. DURING THE COURSE OF APPELLATE PROCEEDING BEFORE US THE LD. COUNSEL HAS FURNISHED PAPER BOOK CONTAINING 158 PAGES CONSISTIN G OF INFORMATION AND DOCUMENT FILED BEFORE THE AO AND LD. CIT(A) DURING T HE COURSE OF ASSESSMENT PROCEEDING AND APPELLATE PROCEEDING. THE LD. COUNSEL HAS CONTENDED THAT AO HAS NOT CONSIDERED THE DOCUMENT AND INFORMATION FURNISH ED DURING THE COURSE OF ASSESSMENT PROCEEDING AND LD. CIT(A) HAS SUSTAINED THE DISALLOWANCE WITHOUT ANY VALID REASON. 7. ON THE OTHER HAND, THE LD. DR HAS RELIED ON THE ORDER OF THE LOWER AUTHORITIES. 8. WE HAVE HEARD BOTH THE SIDES AND PERUSED THE MAT ERIAL ON RECORD. IN RESPECT OF DISCREPANCY IN CONTRACT RECEIPT NOTICE BY THE AO THE LD. COUNSEL HAS REFERRED PAGE NO. 56 OF THE PAPER BOOK COMPRISING A LETTER D ATED 31.12.2012 FILED BEFORE THE AO TOWARDS RECONCILIATION OF DIFFERENCES OBSERV ED IN THE CONTRACT RECEIPT. IT IS CONTENDED THAT BOTH THE AUTHORITIES HAVE NOT CONSID ERED THE DETAIL AND DOCUMENT AS REFERRED ABOVE BEFORE ADDING AND CONFIRMING THE DIS ALLOWANCE. REGARDING ADDITION OF UNEXPLAINED CASH CREDIT OF RS. 8,00,000/- THE LD . COUNSEL HAS REFERRED DOCUMENTS PLACED AT PAGE NO. 136 TO 141 OF THE PAPE R BOOK COMPRISING COPIES OF CONFIRMATION, COPIES OF PAN NO. COPIES OF RETURN OF INCOME, COPIES OF BALANCE SHEET AND COPIES OF BANK STATEMENT ETC. OF THE LENDER AVA ILABLE BEFORE THE AO AND LD. CIT(A) HOWEVER THE SAME WERE NOT CONSIDERED. REGARD ING THIRD ADDITION ON DISALLOWANCE OF LABOUR EXPENSES OF RS. 33,19,460/- THE LD. COUNSEL HAS REFERRED PAGE NO. 61 TO 85 OF THE PAPER BOOK COMPRISING DETA IL AND COPIES OF DOCUMENT LEDGER ACCOUNT ETC. IN SUPPORT OF INCURRING OF LABO UR EXPENSES. IN THE LIGHT OF THE ABOVE FACTS AND CIRCUMSTANCES THE ASSESSEE HAS FURNISHED SPECIFIC DETAIL ALONG WITH COPIES OF DOCUMENTS AS S UPPORTING EVIDENCES TO RECONCILE THE DISCREPANCY OBSERVED BY THE AO IN RESPECT OF CO NTRACT RECEIPT. IT IS ALSO ITA NO. 2784/AHD/2014 [BIJAL DHIMAN VYAS VS. DCIT] A.Y. 2010-11 4 NOTICED THAT ASSESSEE HAS ALSO FURNISHED DOCUMENT O F LENDER SUCH AS PAN CARD, RETURN OF INCOME, BALANCE CONFIRMATION, BANK STATEM ENT ETC. TO PROOF THE GENUINENESS OF UNEXPLAINED LOAN OF RS. 8,00,000/-. THE ASSESSEE HAS ALSO FURNISHED VARIOUS DETAIL AND INFORMATION IN RESPECT OF CLAIM OF LABOUR EXPENSES AND WAS ALSO BROUGHT TO THE NOTICE OF THE AO THAT TDS PR OVISION WAS NOT APPLICABLE TO THE LABOUR PAYMENTS. AFTER CONSIDERING THE AFORESA ID FACT IT IS NOTICED THAT AO HAS NOT SPECIFICALLY CONSIDERED THE ABOVE CITED SPECIFI C DETAIL AND INFORMATION FURNISHED BY THE ASSESSEE DURING THE COURSE OF ASSE SSMENT PROCEEDING. IT IS ALSO NOTICED THAT LD. CIT(A) HAS RETREATED THE REASON OF DISALLOWANCE GIVEN BY THE AO WITHOUT CONSIDERING THE SPECIFIC DETAIL AND INFORMA TION PROVIDED BY THE ASSESSEE DURING THE COURSE OF ASSESSMENT AND APPELLATE PROCE EDING. IN VIEW OF THE ABOVE FACTS, WE OBSERVE THAT THE LD. CIT(A) HAS NOT ADJUDIC ATED THE CASE AS PRESCRIBED IN THE PROVISION OF SEC. 250(6) OF THE ACT WHICH PROVI DE THAT WHILE DISPOSING THE APPEAL THE CIT(A) SHALL STATE THE POINTS FOR DETERM INATION THE DECISION THEREON AND THE REASON FOR THE DECISION. CONSIDERING THE ABOVE WE ARE OF THE VIEW THAT IT WILL BE APPROPRIATE TO RESTORE THIS CASE TO THE FILE OF THE CIT(A) FOR ADJUDICATING THE AFORESAID THREE GROUND OF APPEAL OF THE ASSESSEE A FRESH AFTER VERIFICATION AND EXAMINATION OF THE SUPPORTING DOCUMENT/INFORMATION PROVIDED BY THE ASSESSEE. THEREFORE, APPEAL OF THE ASSESSEE IS RESTORED TO THE FILE OF THE CIT(A) FOR ADJUDICATING A FRESH AS STATED ABOVE AFTER PROVIDIN G ADEQUATE OPPORTUNITY TO THE ASSESSEE. ACCORDINGLY, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSE 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSE. SD/- SD/- (MAHAVIR PRASAD) (AMARJIT SINGH) JUDICIAL MEMBER ACCOUNT ANT MEMBER AHMEDABAD: DATED 16/09/2019 TANMAY TRUE COPY THIS ORDER PRONOUNCED IN OPEN COURT ON 16/09/2019 ITA NO. 2784/AHD/2014 [BIJAL DHIMAN VYAS VS. DCIT] A.Y. 2010-11 5 / COPY OF ORDER FORWARDED TO:- 1. / REVENUE 2. $ / ASSESSEE 3. &' ( / CONCERNED CIT 4. ( - / CIT (A) 5. )*+ ' , ! ' , ,-$&$ / DR, ITAT, AHMEDABAD 6. +. / / GUARD FILE. BY ORDER / $% , 0 / , ! ' , ,-$&$ 1 1.DATE OF DICTATION ON 09.08.2019 2.DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE TH E DICTATING MEMBER 19.08.2019 3.DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S. 16.09.2019 4.DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 16 .09.2019 5.DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR . P.S./P.S 16.09.2019 6.DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 16 .09.2019 7.DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8.THE DATE ON WHICH THE FILE GOES TO THE ASSTT. REG ISTRAR FOR SIGNATURE ON THE ORDER 9.DATE OF DESPATCH OF THE ORDER