DCIT CIRCLE-2, Hazaribagh V. M/s Saurabh Kumar & Brothers, Bokaro

ITA 291/RAN/2016

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 9649 (ITAT-RANCHI)
• Duration Of Justice: 2 year(s) 5 month(s) 22 day(s)
• Appeal Type: Income Tax (Transfer Pricing) Appeal
• Pronouncement Date: 05-04-2019
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 14-10-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: DEEPAK KUMAR SUTARIYA CITA JSR
• Assessee Lawyers: S K PODDAR
• Keywords: Opportunity of being heard
• Section: 143(3); 142(1); 250

Judgement Text

1 ITA NO. 76&291 /RAN/ 2016 IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI BENCH, RANCHI BEFORE SHRI N.S.SAINI , ACCOUNTANT MEMBER & SHRI PAVAN KUMAR GADALE , JUDICIAL MEMBER ITA NO S . 76&291 / RAN/20 1 6 A .Y. : 20 11 - 20 12 DCIT, CIRCLE - 2, HAZARIBAG V S M/S SAURABH KUMAR & BROTHERS, JARIDIH BAZAR, BOKARO T AN NO. : A BAFS 2581 F (APPELLANT ) .. RESPONDENT REVENUE BY :SHRI DEEPAK KUMAR SUTARIYA, CIT(A), JSR ASSESSEE BY : SHRI S.K.PODDAR & DEVESH PODDAR, AR DATE OF HEARING : 21 . 05 .201 8 DATE OF P RONOUNCEMENT : 22.05 .201 8 O R D E R PER PAVAN KUMAR GADALE, JM : TH E SE ARE THE APPEALS FILED BY THE REVENUE AGAINST THE SEPARATE ORDER OF CIT(A), HAZARIBAG, JHARKHAND , IN IT APPEAL NO. 04/HZB/2014 - 15, DATED 16.12.2015 AND ITA NO.60 / HZB / 2015 - 16 , DATED 01.08.2016, PASSED U/S. 143(3) AND 154/ 250 OF THE I.T. ACT . 2. SINCE BOTH THE APPEALS ARE INTERCONNECTED AND ARISING OUT OF THE SAME ASSESSMENT ORDER DATED 31 .03.2014 , THEREFORE, WE CONSIDER ED IT APPROPRIATE TO CONSIDER THE FACTS AND GROUND S NARRATED IN ITA NO. 76/RAN/2016 , WHEREIN THE REVENUE HAS RAISED THE FOLLOWING GROUNDS : - 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LD. C.I.T.(A) ERRED IN DELETING THE ADDITION MADE BY THE ASSESSING OFFICER WITHOUT GIVING THE A.O. ANY OPPORTUNITY OF BEING HEARD. 2 ITA NO. 76&291 /RAN/ 2016 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LD. C.I.T.(A) ERRED IN ACCEPTING THE PAPERS AND DOCUMENTS PRODUCED BEFORE HIM WHEN THE SAME BOOKS OF A/C, PAPERS, DOCUMENTS HAVE NOT BEEN PRODUCED BEFORE THE A.O. IN THE SCRUTINY PRO CEEDINGS. 3 . BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A CIVIL CONTRACT OR AND FILED THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 2011 - 12 ON 30.09.2011 WITH TOTAL INCOME OF RS. 95,56,570/ - . THE RETURN OF INCOME WAS PROCESSED U/S.143(1) OF THE ACT. SUBSEQUENTLY THE CASE WAS SELECTED FOR SCRUTINY AND NOTICE U/S.143(2) & 142(1) WERE ISSUED TO THE ASSESSEE. IN COMPLIANCE THE AR OF THE ASSESSEE APPEARED AND FILED THE DETAILS. THE AO ON PERUSAL OF THE FINANCIAL STATEMENTS AND THE SUBMISSION OF THE ASSESSE E FOUND THAT THE ASSESSEE HAS DEBITED RS.3,29,87,188/ - TO THE PROFIT AND LOSS ACCOUNT, HOWEVER, THE BROUGHT FORWARD WDV OF THE PREVIOUS YEAR STOOD AT RS.2,67,00,481.47, THEREFORE, CLARIFICATION WAS SOUGHT AND THE ASSESSEE REPLIED TO THE CLARIFICATION, WHE REAS THE AO IS OF THE OPINION THAT THE ASSESSEE HAS NOT GIVEN ANY BREAK UP NOR IT HAS PROVIDED ANY BIFURCATION OF SUCH ELEMENT BEING EMBEDDED IN IT. AND ESTIMATED TO THE EXTENT OF 20% ON THE REMAINING BALANCE AFTER DEDUCTING TOWARDS EXPENDITURE FOR FUEL AN D LUBRICANTS AND ACCORDINGLY DISALLOWED RS.33,97,438/ - . SIMILARLY, THE AO MADE DISALLOWANCE ON LABOUR CHARGES AND TRANSPORTING CHARGES OF RS.81,26,425/ - AND ASSESSE D THE TOTAL INCOME AT RS.1,84,17,710/ - AND PASSED ORDER U/S.143(3) OF THE ACT, DATED 31.03.2 014. 4 . AGGRIEVED BY THE ASSESSMENT ORDER , THE ASSESSEE HAS FILED AN APPEAL WITH THE CIT(A). I N THE APPELLATE PROCEEDINGS LD. AR OF THE 3 ITA NO. 76&291 /RAN/ 2016 ASSESSEE ARGUED THE GROUNDS AND REITERATED THE SUBMISSIONS AND LD.CIT(A) HAVING CONSIDERED THE FINDINGS AND THE SUBMISSI ONS OF THE ASSESSEE DEALT ON THE DISPUTED ISSUE S . THE CIT(A) OBSERVED THAT ONLY WITH REGARD TO MACHINERY EXPENSES, THE ASSESSEE COULD NOT PRODUCE THE VOUCHERS READILY FOR HIS PERUSAL AND DISALLOWED THE SAME, WHEREAS THE ADDITION ON ACCOUNT OF MACHINERY RUN NING AND MAINTENANCE EXPENSES, THE CIT(A) DIRECTED THE AO TO DELETE THE ADDITION. SIMILARLY THE CIT(A) DELETED THE ADDITION ON ACCOUNT OF ADDITION MADE U/S.40(A)(IA) OF THE ACT AND ALSO DELETED THE ADDITION ON ACCOUNT OF TEA AND COFFEE EXPENSES AND PARTLY ALLOWED THE APPEAL OF THE ASSESSEE. 5 . AGGRIEVED BY THE ORDER OF CIT(A), THE REVENUE HAS FILED AN APPEAL BEFORE THE TRIBUNAL. 6 . BEFORE US, LD. D R SUBMITTED THAT THE CIT(A) HAS ERRED IN DELETING THE ADDITIONS MADE BY THE AO WITHOUT GIVING PROPER OPPORTUNIT Y TO THE AO AND FURTHER THE CIT(A) ACCEPTED THE DOCUMENTS PRODUCED BEFORE HIM BY THE ASSESSEE WHICH WERE NOT PRODUCED BEFORE THE AO AND VIOLATED THE PROVISIONS OF RULE 46A, THEREFORE, PRAYED FOR RESTORATION TO THE FILE OF AO. 7 . CONTRA, LD. A R RELIED ON TH E ORDER OF CIT(A) AND ALSO FILED PAPER BOOK EXPLAINING WITH RESPECT TO SUBMISSION MADE BEFORE THE AO AND THE REPLY MADE TO THE NOTICE ISSUED BY THE AO. 8 . WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE SOLE DISPUTED ISSUE IS W ITH RESPECT TO THE FACT THAT THE CIT(A) HAS UNILATERALLY DEALT WITH THE SUBMISSIONS OF THE ASSESSEE AND ALSO THE 4 ITA NO. 76&291 /RAN/ 2016 DOCUMENTS FILED BEFORE HIM AND TOOK A DECISION WITHOUT CALLING FOR ANY REPORT AT THE END OF THE AO. WE ON PERUSAL OF THE ORDER OF CIT(A) FOUND THAT THE ASSESSEE HAS FILED DETAILS IN APPELLATE PROCEEDINGS AND THE CIT(A) HAS MADE AN OPINION THAT THE ASSESSEE HAS PRODUCED LEDGER ACCOUNT, BILLS AND VOUCHERS IN SUPPORT OF ITS CLAIM, HOWEVER, NO REMAND REPORT HAS BEEN CALLED FOR FROM THE AO BY THE CIT( A). BUT PRIMA FACIE THESE INFORMATION COULD NOT BE CULLED OUT FROM THE DOCUMENTS FILED BEFORE THE AO AND THESE FACTS COULD NOT SUPPORTED WITH ANY EVIDENCE. THEREFORE, THE CIT(A) HAS DEALT INDEPENDENTLY ON THE SUBMISSIONS OF THE ASSESSEE AND IN THE INTEREST OF JUSTICE, WE RESTORE THIS ISSUE TO THE FILE OF CIT(A), WHO SHALL ADJUDICATE THE ISSUE BASED ON THE FINDINGS OF AO AND THE SUBMISSION OF ASSESSEE AS PROVIDE EARLIER. ACCORDINGLY, THIS GROUND OF APPEAL OF REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. 9 . SI MILAR GROUNDS HAVE BEEN RAISED BY THE REVENUE IN ITS APPEAL I.E.ITA NO.291/ RAN /2016, HENCE, THE REASONING GIVEN BY US IN THE ABOVE APPEAL OF REVENUE IN ITA NO.76/ RAN /2016 WILL BE APPLICABLE TO THE PRESENT FACTS AND CIRCUMSTANCES OF THE CASE. ACCORDINGLY, W E ALSO RESTORE THE ISSUE INVOLVED IN THE PRESENT APPEAL TO THE FILE OF CIT(A), WHO SHALL ADJUDICATE AFTER CONSIDERING THE FINDINGS OF AO AND THE SUBMISSION OF THE ASSESSEE AND THE ASSESSEE IS DIRECTED TO COOPERATE IN THE APPELLATE PROCEEDINGS FOR EARLIER D ISPOSAL OF THE CASE. THE GROUNDS RAISED IN THIS APPEAL ARE ALLOWED FOR STATISTICAL PURPOSES. 5 ITA NO. 76&291 /RAN/ 2016 1 1 . IN THE RESULT, BOTH APPEALS OF REVENUE ARE A LLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED IN THE OPEN COURT ON 22 / 05 /201 8 SD/ - SD/ - ( N.S.SAINI ) ( PAVAN KUMAR GADALE ) ACCOUNTANT MEMBER JUDICIAL MEMBER RANCHI , DATED 22 / 05 /201 8 PRAKASH KUMAR MISHRA , SR. PS COPY OF THE ORDER FORWARDED TO : BY ORDER, //TRUE COPY// SR.PS, ITAT, RANCHI 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) CONCERNED 4. CIT , CONCERNED 5. DR, ITAT, RANCHI 6. GUARD FILE.