A.C.I.T Cir - 36,kolkata., Kolkata V. M/s Tirupati Enterprises, Kolkata

ITA 28/KOL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 100063 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-11-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 04-01-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 142(1)

Judgement Text

I.T.A. NO. 28/KOL./2013 ASSESSMENT YEAR: 2007-2008 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA B BENCH, KOLKATA BEFORE SHRI M. BALAGANESH, ACCOUNTANT MEMBER AND SHRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER I.T.A. NO. 28/KOL/ 2013 ASSESSMENT YEAR : 2007-2008 ASSISTANT COMMISSIONER OF INCOME TAX,.............. ....................APPELLANT CIRCLE-36, KOLKATA, AAYAKAR BHAWAN POORVA, 8 TH FLOOR, 110, SHANTIPALLY, KOLKATA-700 107 -VS.- M/S. TIRUPATI ENTERPRISES,......................... ............................RESPONDENT P-12, NEW HOWRAH BRIDGE, APPROACH ROAD, KOLKATA-700 001 [PAN : AADFT 4753 G] APPEARANCES BY: SHRI KALYAN NATH, JCIT, SR. D.R., FOR THE DEPARTMENT N O N E, FOR THE ASSESSEE DATE OF CONCLUDING THE HEARING : OCTOBER 30, 2015 DATE OF PRONOUNCING THE ORDER : NOVEMBER 20 TH , 2015 O R D E R PER SHRI S.S. VISWANETHRA RAVI :- THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-XX, KOLKATA IN APPEAL NO. 344/CIT(A)-XX/CIR-36/09-10/KOL DATED 25.09.2012 FOR THE ASSESSMENT YEAR 2007-08 ON THE FOLLOWING GROUND:- ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD . CIT(A)-XX, KOLKATA HAS ERRED IN DELETING THE ADDITI ON OF RS.60,00,000/-, WHEREAS THE ASSESSEE HAS NEITHER PRODUCED THE ORIGINAL DEED OF CANCELLATION, SURREND ER AND RELEASE BETWEEN THE ASSESSEE AND M/S. SUNRISE PROJE CTS I.T.A. NO. 28/KOL./2013 ASSESSMENT YEAR: 2007-2008 PAGE 2 OF 4 PVT. LTD. ON THE TIME OF ASSESSMENT PROCEEDINGS NOR AT THE TIME OF REMAND PROCEEDINGS 2. NONE APPEARED ON BEHALF OF THE ASSESSEE WHEN THE CASE WAS CALLED FOR HEARING. WE, THEREFORE, DECIDED TO DISPOSE OF T HE SAME AFTER HEARING THE LEARNED D.R. AND THE MATERIAL AVAILABLE ON RECO RD. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE-CO MPANY IS ENGAGED IN THE BUSINESS OF PROPERTY DEVELOPMENT. THE ASSESSEE FILED ITS RETURN OF INCOME THROUGH E-FILING FOR THE YEAR UNDER CONSIDER ATION SHOWING TOTAL INCOME OF RS.10,39,624/- ON 31.10.2007. THE CASE WA S SELECTED FOR SCRUTINY UNDER CASS AND NOTICES UNDER SECTIONS 143( 2) AND 142(1) WERE ISSUED AND DULY SERVED ON THE ASSESSEE. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE FILED A STATEMENT FOR COS T OF CONSTRUCTION, WHEREIN IT HAS BEEN SHOWN THAT THE ASSESSEE HAS PAI D RS.60,00,000/- TO M/S. SUNRISE PROJECTS PVT. LTD. THE ASSESSEE WAS RE QUESTED TO EXPLAIN THE NATURE OF PAYMENT MADE TO M/S. SUNRISE PROJECTS PVT . LTD. IN REPLY, ASSESSEE EXPLAINED THAT THE PAYMENT WAS MADE FOR CA NCELLATION OF CONTRACT AS COMPENSATION. THE ASSESSEE WAS REQUESTE D TO FURNISH DOCUMENTARY EVIDENCE IN SUPPORT OF ITS CLAIM BUT NO EVIDENCE WAS FILED BY THE ASSESSEE TO THE ASSESSING OFFICER. IT WAS FOUND FROM THE COPY OF AGREEMENT BETWEEN THE ASSESSEE AND SHRI GANESH JEW THAKUR TRUST FILED IN COURSE OF ASSESSMENT PROCEEDINGS THAT THERE WAS NO CLAUSE REGARDING PAYMENT OF COMPENSATION TO M/S. SUNRISE PROJECTS PV T. LTD. TO THE TUNE OF RS.60 LAKHS AS CLAIMED FOR CANCELLATION OF CONTRACT . AS THE ASSESSEE COULD NOT FURNISH ANY DOCUMENTARY EVIDENCE IN SUPPORT OF ITS CLAIM, THE ASSESSING OFFICER ADDED THE SAME TO THE TOTAL INCOM E OF THE ASSESSEE AS UNDISCLOSED INCOME. AGGRIEVED AGAINST THE ORDER OF ASSESSING OFFICER, THE ASSESSEE WENT IN APPEAL BEFORE THE LD. CIT(APPEALS) . 4. ON APPEAL, LD. CIT(APPEALS) DELETED THE ADDITION MADE BY THE ASSESSING OFFICER BY OBSERVING AS UNDER:- I HAVE PERUSED THE ASSESSMENT ORDER, REMAND REPORT OF THE AO AND CONSIDERED THE SUBMISSION OF THE APPELLANT. I F IND FROM THE I.T.A. NO. 28/KOL./2013 ASSESSMENT YEAR: 2007-2008 PAGE 3 OF 4 ASSESSMENT ORDER THAT THE AO DISALLOWED THE PAYMENT OF COMPENSATION CLAIMED TO HAVE MADE TO M/S. SUNRISE P ROJECTS PVT. LTD. TO THE TUNE OF RS.60,00,000/-AS THE APPEL LANT FAILED TO FURNISH ANY DOCUMENTARY EVIDENCE IN SUPPORT OF ITS CLAIM AT THE TIME OF ASSESSMENT PROCEEDING. IN THE COURSE OF REM AND PROCEEDINGS, THE APPELLANT SUBMITTED BEFORE THE AO A COPY OF AGREEMENT HELD BETWEEN THE APPELLANT AND M/S. SUNRI SE PROJECTS PVT. LTD. (EXECUTED ON 30.01.2004) AND ALS O A COPY OF DEED FOR CANCELLATION SURRENDER AND RELEASE OF CONT RACT/SHARE IN PROPERTY (EXECUTED ON 01.04.2006). THE AO STATED IN HIS REMAND REPORT THAT THE ABOVE PAYMENT HAS ALREADY BE EN REFLECTED IN THE BOOKS OF ACCOUNTS OF THE APPELLANT AS WELL AS OF M/S. SUNRISE PROJECTS PVT. LTD. THE AO'S REPORT IS BASED ON INSPECTOR'S REPORT WHO WAS DEPUTED BY THE AO IN THE COURSE OF REMAND PROCEEDINGS TO VERIFY THE GENUINENESS OF THE PAYMENT OF RS.60,00,000/- AS COMPENSATION MADE BY THE APPELLAN T TO M/S. SUNRISE PROJECTS PVT. LTD. AND WHO ALSO VERIFIED TH E BANK ACCOUNT OF THE SAID PARTY AND HAS SEEN THAT THE SAM E AMOUNT HAS BEEN CREDITED IN THEIR ACCOUNT. AT THE APPELLAT E PROCEEDINGS ALSO THE APPELLANT FILED THE DOCUMENTAR Y EVIDENCES IN SUPPORT OF ITS CLAIM AND THE SAME WAS FORWARDED TO THE AO FOR HIS COMMENT. THE APPELLANT ALSO PRODUCED ORIGIN AL COPY OF AGREEMENT FOR VERIFICATION. AFTER TAKING INTO ACCOU NT ALL THE RELEVANT FACTS INCLUDING THE AO'S REPORT, I AM OF T HE VIEW THAT THERE IS NO DOUBT ABOUT GENUINENESS OF THE ABOVE TR ANSACTION AS IT WAS BASED ON AGREEMENT AND THE PAYMENT WAS ROUTE D THROUGH BANKING CHANNEL. THEREFORE, THE EXPENDITURE IS ATTRIBUTABLE WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF BUSINESS OF THE APPELLANT. IN THESE FACTS AND CIRCUMSTANCES OF THE CASE AS DISCUSSED ABOVE, THE GROUND RAISED BY THE APPELLANT IS ALLOWED. 5. WE HAVE HEARD THE LD. D.R. AND PERUSED THE MATER IAL AVAILABLE ON RECORD. FROM THE RECORD WE FIND THAT THE LD. CIT(AP PEALS) WAS RIGHT IN UPHOLDING THE ORDER OF ASSESSING OFFICER AS THE ASS ESSEE IN THE COURSE OF REMAND PROCEEDINGS SUBMITTED BEFORE THE AO A COPY O F AGREEMENT HELD BETWEEN THE ASSESSEE AND M/S. SUNRISE PROJECTS PVT. LTD. (EXECUTED ON 30.01.2004) AND ALSO A COPY OF DEED FOR CANCELLATIO N SURRENDER AND RELEASE OF CONTRACT/SHARE IN PROPERTY (EXECUTED ON 01.04.2006). FROM THE RECORD, WE FIND THAT THE AO STATED IN HIS REMAND RE PORT THAT THE ABOVE PAYMENT HAS ALREADY BEEN REFLECTED IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE AS WELL AS OF M/S. SUNRISE PROJECTS PVT. L TD. WE FIND FROM THE RECORD THAT THE TRANSACTION WAS BASED ON AGREEMENT AND THE PAYMENT WAS ROUTED THROUGH BANKING CHANNEL. WE HOLD THAT MERELY FOR NON-PROSECUTION OF ORIGINAL DOCUMENT BEFORE THE ASSESSING OFFICER D URING THE REMAND PROCEEDINGS, THE TRANSACTION PER SE CANNOT BE DOUBTED WITH WHEN THE I.T.A. NO. 28/KOL./2013 ASSESSMENT YEAR: 2007-2008 PAGE 4 OF 4 XEROX COPIES WITH SUPPORTING DOCUMENTS WERE DULY FU RNISHED BEFORE THE ASSESSING OFFICER. MOREOVER, THE ASSESSING OFFICER HAD NOT GIVEN ANY ADVERSE REMARKS ON THE VERACITY OF SAID DOCUMENT, E XCEPT STATING THAT ORIGINAL DOCUMENTS WERE NOT SUBMITTED BEFORE HIM. W E THEREFORE, FIND NO INFIRMITY IN THE ORDER OF LD. CIT(APPEALS) AND UPHO LD THE ORDER OF LD. CIT(APPEALS). THUS THIS GROUND OF APPEAL RAISED BY THE REVENUE IS DISMISSED. 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON NOVEMBER 20 TH , 2015. SD/- SD/- (M. BALAGANESH) (S.S. VISWANETHRA RAVI) ACCOUNTANT MEMBER JUDI CIAL MEMBER KOLKATA, THE 20 TH DAY OF NOVEMBER, 2015 COPIES TO : (1) ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-36, KOLKATA, AAYAKAR BHAWAN POORVA, 8 TH FLOOR, 110, SHANTIPALLY, KOLKATA-700 107 (2) M/S. TIRUPATI ENTERPRISES, P-12, NEW HOWRAH BRIDGE, APPROACH ROAD, KOLKATA-700 001 (3) COMMISSIONER OF INCOME TAX (APPEALS)- XX, KOL KATA (4) COMMISSIONER OF INCOME TAX, KOLKATA (5) THE DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.