M/S SWARN SANGAM , BOKARO V. DCIT CIR-3 , BOKARO

ITA 286/RAN/2017

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 3861 (ITAT-RANCHI)
• Duration Of Justice: 1 year(s) 11 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-11-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2013-2014
• Appeal Filed On: 16-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 40A(3); 143(3); 133A; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL ANCHI BENCH, RANCHI BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER AND MS. MADHUMITA ROY, JUDICIAL MEMBER I.T.A. NO. 286/RAN/2017 ASSESSMENT YEAR: 2013-14 M/S. SWARN SANGAM....APPELLANT BY PASS ROAD, CHAS, BOKARO 827 013. [PAN: AAZFS 0908 A] DCIT, CIRCLE 3, BOKARO...................................................................................................RESPONDENT BOKARO. APPEARANCES BY: SHRI R.K. PANDEY, ADVOCATE APPEARING ON BEHALF OF THE ASSESSEE. SMT. NISHA SINGH MARR, JCIT APPEARING ON BEHALF OF THE REVENUE. DATE OF CONCLUDING THE HEARING : NOVEMBER 05, 2019 DATE OF PRONOUNCING THE ORDER : NOVEMBER 08, 2019 ORDER PER MS. MADHUMITA ROY, JM THE INSTANT APPEAL AT THE INSTANCE OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 12.06.2017 PASSED BY THE LD. CIT(A) HAZARIBAG, JHARKHAND ARISING OUT OF THE ORDER DATED 21.03.2016 PASSED U/S 143(3) OF THE INCOME TAX ACT, 1961 (HEREIN AFTER REFERRED TO AS THE ACT) BY THE DCIT, CIRCLE - 3, BOKARO FOR THE A.Y. 2013-14 WITH THE FOLLOWING GROUNDS: I. BECAUSE LEARNED CIT(APPEAL) FAIL TO APPRECIATE THE BASIC RULE THAT A PERSON COMMITTING A MISTAKE CANNOT TAKE ADVANTAGE OF IT AND, THEREFORE, THE SAID STATEMENT OBTAIN UPON GROSS MIS-REPRESENTATION OF FACTS FROM A PARTNER OF THE APPELLANT WAS NOT WORTHY OF ANY CREDENCE. SO THE CONFIRMATION OF RS. 50,76,611/- SHOULD NOT ADDED IN THE TOTAL INCOME. II. BECAUSE THE ENTIRE DIFFERENCE STOCK WAS CALCULATED ON SALE PRICE, WHILE THAT SHOULD BE ONLY ON PURCHASE PRICE. SO THE ADDITION OF RS. 50,76,611/- SHOULD NOT ADDED IN TOTAL INCOME. III. FOR THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN CONFIRMING A DISALLOWANCE OF RS. 2,05,699/- UNDER THE HEAD FUEL EXPENSES DISALLOWED U/S 40A(3) OF 2 I.T.A. NOS. 286/RAN/2017 ASSESSMENT YEAR: 2013-14 M/S. SWARN SANGAM THE ACT, 1961. THE EXPENSES WERE INCURRED ON RETAIL PURCHASE OF THE FUEL IN ODD HOURS DUE TO NEED OF BUSINESS. OTHERWISE, OPERATION OF THE PLANT COULD HAVE BEEN STOPPED. IV. BECAUSE THE LD. CIT(A) HAS CONFIRMED RS. 28,37,650/- OF THE MONUMENTS ITEMS WITH THE SALE PRICE IN THE DIFFERENCE STOCK. SO THE ADDITION SHOULD NOT BE ADDED IN TOTAL INCOME. V. KINDLY STAY THE DEMAND PENDING DECISION IN APPEALED. 2. AT THE TIME OF HEARING OF THE INSTANT APPEAL THE LEARNED COUNSEL APPEARING FOR THE ASSESSEE ONLY PRESSED THE GROUND RELATING TO THE CONFIRMATION OF ADDITION TO THE TUNE OF RS. 28,37,650/- IN RESPECT OF THE MONUMENTS ITEMS. 3. THE ASSESSEE CARRIES A BUSINESS OF PURCHASE AND SALE OF JEWELLERY, ORNAMENTS IN RETAIL. ON 05.02.2013, A SURVEY U/S 133A OF THE ACT WAS CONDUCTED AT THE BUSINESS PREMISES OF THE ASSESSEE WHEREUPON THE VALUE OF THE MONUMENTS (SHOW PIECE) WHICH WAS NOT SALEABLE ITEMS WAS CALCULATED AT RS. 28,37,650/- AND THE SAME WAS ULTIMATELY ADDED TO THE TOTAL INCOME OF THE ASSESSEE BY THE LD. AO, AS EXCESS TRADING STOCK WHICH IN TURN, WAS CONFIRMED BY THE LD. CIT(A). HENCE THE INSTANT APPEAL BEFORE US. 4. THE CASE OF THE ASSESSEE IS THAT THE PURCHASE OF THOSE MONUMENTS, MADE IN SILVER WAS MADE AT RS. 2,18,726/- TOTAL WEIGH WHEREOF WAS 48.925 KG. AT THE TIME OF HEARING OF THE INSTANT APPEAL, THE LD. ADVOCATE ALSO PRODUCED THE RELEVANT PURCHASE BILLS IN SUPPORT OF HIS CLAIM. HOWEVER, THE SAME WERE ALSO MADE KNOWN TO THE AUTHORITIES BELOW BY THE ASSESSEE WHICH IS REFLECTED IN THE ORDER PASSED BY THE FIRST APPELLATE AUTHORITY AT PARAGRAPH 2.2, PAGE 2 BUT 3 I.T.A. NOS. 286/RAN/2017 ASSESSMENT YEAR: 2013-14 M/S. SWARN SANGAM THE SAME WAS NOT TAKEN INTO CONSIDERATION IN ITS PROPER PERSPECTIVE AND ADDITION WAS CONFIRMED. IN THAT VIEW OF THE MATTER, THE LD. AR PRAYED FOR DELETION OF THE ADDITION MADE BY THE AUTHORITIES BELOW ON THE BASIS OF THE VALUE CALCULATED BY THE SURVEY PARTY. ON THE OTHER HAND, THE LEARNED DR RELIED UPON THE ORDERS PASSED BY THE AUTHORITIES BELOW. 5. HEARD THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD INCLUDING THE CONCERNED BILLS PRODUCED BY THE LEARNED AR BEFORE US, COPY WHEREOF WAS ALSO HANDED OVER TO THE LEARNED DR. 6. IT IS ON RECORD THAT THAT AMOUNT WAS ALSO MADE BY CHEQUE BY THE ASSESSEE AT THE TIME OF PURCHASE OF THOSE MONUMENTS ON 29.09.2004. THE EXPLANATION OF THE ASSESSEE IN RESPECT OF ALLEGED EXCESS STOCK IS THUS PLAUSIBLE TO A GREAT EXTENT IN VIEW OF THE RECEIPTS PRODUCED BY THE ASSESSEE BEFORE US. TAKING INTO CONSIDERATION THIS ASPECT OF THE MATTER, THE BENEFIT OF DOUBT DESERVES TO GO IN FAVOUR OF THE ASSESSEE AND HENCE THE ADDITION MADE ON THE BASIS OF CALCULATION MADE BY THE SURVEY PARTY ON THOSE MONUMENTS IS LIABLE TO BE DELETED. HENCE, WE DELETE THE SAME. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 08 NOVEMBER, 2018. SD/- SD/- ( PRADIP KUMAR KEDIA) (MADHUMITA ROY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 08/11/2019 BISWAJIT, SR. PS 4 I.T.A. NOS. 286/RAN/2017 ASSESSMENT YEAR: 2013-14 M/S. SWARN SANGAM COPY OF ORDER FORWARDED TO: 1. M/S. SWARN SANGAM. 2. DCIT, CIRCLE 3, BOKARO. 3. THE CIT(A) 4. THE CIT 5. DR TRUE COPY, BY ORDER, SR. P.S. / H.O.O. ITAT, RANCHI