Chengalvarayan Pathapati, CHENNAI V. ITO, CHENNAI

ITA 328/CHNY/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 6259 (ITAT-CHENNAI)
• Duration Of Justice: 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-09-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 26-07-2017
• Assessment Year: 2012-2013
• Appeal Filed On: 06-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAGADEVAN
• Assessee Lawyers: B SURESH

Judgement Text

, .. , IN THE INCOME TAX APPELLATE TRIBUNAL , SMC B BENCH, CHENNAI . , BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ I.T.A.NO.328/MDS/2017 ( / ASSESSMENT YEAR: 2012-13) SHRI CHENGALVARAYAN PATHAPATI, PLOT NO.25, VEERAPA NAGAR, VALASARAVAKKAM, CHENNAI 600 087. VS THE INCOME TAX OFFICER, NON CORPORATE WARD 8(2), CHENNAI . PAN: ACNPC9200D ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : SHRI B. SURESH, CA /RESPONDENT BY : SHRI SAGADEVAN, JCIT /DATE OF HEARING : 26.07.2017 !' /DATE OF PRONOUNCEMENT : 06.09.2017 / O R D E R THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE LD. COMMISSIONER OF INCOME TAX (APPEA LS)-9, CHENNAI DATED 29.11.2016 IN ITA NO.10/CIT(A)-9/2015 -16 FOR THE ASSESSMENT YEAR 2012-13 PASSED U/S.250(6) R.W.S.143 (3) OF THE ACT. 2 ITA NO.328/MDS/2017 2. THE ASSESSEE HAS RAISED SEVERAL GROUNDS IN HIS A PPEAL HOWEVER THE CRUX OF THE ISSUE IS THAT THE LD.CIT(A) HAS ER RED BY TREATING THE AMOUNT OF RS.4,08,048/- AS THE UNDISCLOSED INCOME O F THE ASSESSEE BECAUSE HE HAD FAILED TO PRODUCE THE CONFIRMATION L ETTER FROM SHRI BASKARAN FROM WHOM THE ASSESSEE HAD PURCHASED BRICKS. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS AN INDIVIDUAL ENGAGED IN THE BUSINESS OF CIVIL CONTRACT, FILED HI S RETURN OF INCOME FOR THE ASSESSMENT YEAR 2012-13 ON 29.12.2012 ADMIT TING INCOME OF RS.7,56,938/-. THE CASE WAS SELECTED FOR SCRUTINY AND FINALLY ORDER WAS PASSED U/S.143(3) OF THE ACT ON 16.03.2015, WHE REIN THE LD.AO HAD MADE ADDITION OF RS.8,58,148/- WITH RESPECT TO PURCHASES, BECAUSE THE ASSESSEE HAD NOT PRODUCED BILLS AND VOU CHERS. ON APPEAL, THE LD.CIT(A) SUSTAINED THE ADDITION OF RS. 4,04,048/- BECAUSE THE ASSESSEE DID NOT PRODUCED CONFIRMATION LETTER FROM SHRI BASKARAN, WHO WAS SUPPOSED TO HAVE SUPPLIED BRICKS TO THE ASSESSEE. FURTHER THE LD.AO ALSO COULD NOT COMMUNI CATE TO SHRI BASKARAN BECAUSE THE SUMMONS ISSUED TO HIM WAS RETURNED AS UN- SERVED. MOREOVER THE SUBMISSION OF THE ASSESSEE WAS THAT THE MATERIALS WERE DIRECTLY DELIVERED BY SHRI BASKARAN TO THE ASSESSEES 3 ITA NO.328/MDS/2017 CLIENTS AND THE ASSESSEE HAD MERELY DEBITED HIS CLI ENTS A/C AND CREDITED SHRI BASKARANS ACCOUNT. 4. BEFORE ME, THE LD. AR REITERATED THE SUBMISSION MADE BEFORE THE REVENUE AUTHORITIES AND PLEADED THAT THE ASSESS EE HAD NOT INCURRED ANY EXPENDITURE, IT WAS MERELY AN BOOK ENT RY PASSED IN THE BOOKS OF THE ASSESSEE BY DEBITING THE ASSESSEES CL IENTS ACCOUNT AND CREDITING SHRI BASKARANS ACCOUNT BECAUSE SHRI BASKARAN HAS DIRECTLY DELIVERED THE BRICKS TO THE ASSESSEES CLI ENTS. IT WAS THEREFORE PLEADED THAT THE ADDITION MADE IN THE HAN DS OF THE ASSESSEE MAY BE DELETED. THE LD.DR ON THE OTHER HA ND RELIED ON THE ORDERS OF THE LD.REVENUE AUTHORITIES. 5. I HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY PERUSED THE MATERIALS ON RECORD. FROM THE FACTS OF THE CASE, I T APPEARS THAT THE ASSESSEES CLIENT HAD DIRECTLY PROCURED THE CONSTRU CTION MATERIALS AND MERE BOOK ENTRIES WERE PASSED IN THE BOOKS OF T HE ASSESSEE TO ACCOUNT FOR THE MATERIALS CONSUMED. THE PURCHASE O F THE BUILDING CONSTRUCTION MATERIALS WAS DIRECTLY MADE BY THE ASS ESSEES CLIENT AND THE ASSESSEE DO NOT HAVE ANY CONTROL ON THE SAM E. IN THIS SITUATION, IM OF THE VIEW THAT THE ASSESSEE SHOULD NOT SUFFER WITH 4 ITA NO.328/MDS/2017 RESPECT TO THE TRANSACTION DIRECTLY MADE BETWEEN TH E ASSESSEES CLIENT AND THE SUPPLIER OF THE BUILDING MATERIALS. THEREFORE I HEREBY DIRECT THE LD.AO TO DELETE THE ADDITION OF RS.4,04, 048/- WHICH WAS SUSTAINED BY THE LD.CIT(A). 6. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLO WED. ORDER PRONOUNCED ON THE 06 TH SEPTEMBER, 2017 AT CHENNAI. SD/- ( . ) (A. MOHAN ALANKAMONY) / ACCOUNTANT MEMBER #$ /CHENNAI, %& /DATED 06 TH SEPTEMBER, 2017 RSR & () *) /COPY TO: 1. /APPELLANT 2. /RESPONDENT 3. - ( )/CIT(A) 4. - /CIT 5. )./ 0 /DR 6. /1 /GF