Smt. Anita Kapoor Prop., Jammu V. The Deputy Commissioner of Income tax, Jammu

ITA 354/ASR/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 5831 (ITAT-AMRITSAR)
• Duration Of Justice: 10 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-06-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2005-2006
• Appeal Filed On: 09-08-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMRIK CHAND
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.L. KARWA, VICE PRESIDENT AND SH. MEHAR SINGH, ACCOUNTANT MEMBER I.T.A. NO.354(ASR)/2010 ASSESSMENT YEAR:2005-06 PAN :ADCPK6337R SMT. ANITA KAPOOR, PROP. VS. DY. COMMR. OF INCOME- TAX, CHENAB STEEL FABRICATION, CIRCLE-1, SAMBA. (J&K) JAMMU. (APPELLANT) (RESPONDENT) APPELLANT BY: NONE RESPONDENT BY: SH. AMRIK CHAND, DR ORDER PER MEHAR SINGH, AM, THE PRESENT APPEAL FILED BY THE ASSESSEE IS DIRECT ED AGAINST THE ORDER OF THE CIT(A), JAMMU, DATED 17.12.2009, PASSED UNDE R SECTION 250(6) OF THE INCOME-TAX ACT, (HEREINAFTER REFERRED TO IN SHORT T HE ACT) FOR THE ASSESSMENT YEAR 2005-06. 2. THE GROUNDS OF APPEAL TAKEN BY THE ASSESSEE READ AS UNDER: 1 THAT THE ORDER PASSED U/S 143(3) IS BAD IN LAW A S NO NOTICE U/S 143(2) HAS BEEN ISSUED WITHIN THE STIPULATED TIME A S ENVISAGED U/S 143(2). 2. THAT THE AUTHORITIES BELOW HAVE ERRED IN DISALLO WING THE EXPENDITURE OF RS.2,37,200/-. 3. THAT THE ADDITION HAS BEEN RESTORED TO ON MERE S USPICION AND CONJECTURES. 2 4. THAT THE APPELLANT CRAVES LEAVE TO ADD/AMEND ANY GROUNDS OF APPEAL AT THE TIME OF HEARING. 3. IN GROUND NO. 2, THE ASSESSEE RAISED THE ISSUE T HAT THE AUTHORITIES BELOW ERRED IN DISALLOWING THE EXPENDITURE OF RS.2 ,37,200/-. THE BRIEF AND NEAT FACTS OF THE CASE, AS CULLED OUT FROM THE RELE VANT RECORDS ARE THAT THE ASSESSEE IS A MANUFACTURER AND FABRICATOR OF STEEL POLES. DURING THE ASSESSMENT YEAR UNDER REFERENCE, THE ASSESSEE FILED THE RETURN DECLARING INCOME OF RS.7,41,200/- AS AGAINST THE ASSESSED INC OME OF RS.10,34,560/-. THE ASSESSEE HAD DEBITED RS.2,37,200/- TO THE P & L ACCOUNT AT THE FAG END OF THE YEAR UNDER THE HEAD WAGES PAINTING SECTION. WHEN CONFRONTED, THE ASSESSEE STATED THAT PAINTING WORK FOR EARLIER NINE MONTHS WAS DONE BY THE FACTORY WORKERS. THE ASSESSEE HAD VERY SMALL NUMBER OF WORKERS WHO COULD NOT COPE WITH THE VOLUME OF WORK AND, THEREFORE, IT HAD TO ENGAGE WORKERS FROM OUTSIDE. THE EXTRA LABOUR WAS NECESSITATED FOR MEETING THE SUPPLY DEMAND OF THE GOVERNMENT ORDER, WHO WAS THE MAIN CU STOMER IN THE STATE THUS, THE WAGES HAVE BEEN PAID TO EXTRA LABOURERS. THE AO STATED THAT THE ASSESSEE HAS FAILED TO FILE DETAILS AND THE LIST O F WORKERS WHO WERE ALLEGEDLY ENGAGED TO THE WORK. THE AO BEING NOT SATISFIED WIT H THE EXPLANATION OF THE ASSESSEE, MADE AN ADDITION OF RS.2,37,200/-. ON APP EAL, THE LD. CIT(A), CONFIRMED THE ADDITION MADE BY THE A.O. AGGRIEVED B Y THE ORDER OF THE LD. CIT(A), THE ASSESSEE IS IN APPEAL BEFORE US. 4. IN THE COURSE OF PRESENT APPELLATE PROCEEDINGS, THE LD. COUNSEL FOR THE ASSESSEE PLEADED THAT THE REASONS GIVEN BY THE AO F OR MAKING THE ADDITION ARE MERELY BASED ON FLIMSY GROUNDS AND CONJECTURES, AS APPEARS FROM THE BODY OF THE ASSESSMENT ORDER. THE CONTENTION OF THE A.O THAT NO DETAILS WERE FILED IS FACTUALLY INCORRECT. HE SUBMITTED THAT THE ASSESSEE HAD FILED COMPLETE 3 DETAILS, AS DESIRED BY THE A.O. FROM TIME TO TIME A LONGWITH EXPLANATION AND REASONS FOR PAYMENT OF ADDITIONAL WAGES. THE LD. CO UNSEL FOR THE ASSESSE, FURTHER STATED THAT THE ADDITION MADE AND CONFIRMED BY THE CIT(A), IS BASED ON MERE ILLUSIONARY AND IRRELEVANT GROUNDS AND REQU ESTED THAT THE SAME MAY BE DELETED. 5. THE LD. DR, ON THE OTHER HAND, RELIED ON THE O RDERS OF THE AUTHORITIES BELOW. 5. WE HAVE HEARD BOTH THE PARTIES AND CAREFULLY CON SIDERED THE RIVAL SUBMISSIONS WITH REFERENCE TO FACTS, EVIDENCE AND M ATERIAL PLACED ON RECORD. WE HAVE ALSO GONE THROUGH THE ORDERS OF THE AUTHORI TIES BELOW. FROM THE ORDERS OF THE AUTHORITIES BELOW, IT IS OBVIOUS THAT THE ADDITION MADE AND CONFIRMED BY THE LD. CIT(A), IS PURELY BASED ON ASS UMPTION AND PRESUMPTION. THE AO AS WELL AS THE LD. CIT(A) HAS N OT TAKEN COGNIZANCE OF THE DETAILED INFORMATION FURNISHED BY THE ASSESSEE IN SUPPORT OF HER CLAIM. THE ADDITION MADE, IF ANY, ON FLIMSY GROUND DOES NO T SURVIVE IN THE EYES OF LAW. WE ARE, THEREFORE, OF THE CONSIDERED OPINION THAT THE ADDITION MADE AND SUSTAINED BY THE LD. CIT(A) ON SURMISES AND CONJEC TURES DESERVES TO BE DELETED. ACCORDINGLY, THE ADDITION, IN DISPUTE IS DELETED AND THIS GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. 6. IN GROUND NO.1, THE ASSESSEE CONTENDED THAT THE ORDER PASSED U/S 143(2) IS BAD IN LAW AS NO NOTICE U/S 143(2) HAS B EEN ISSUED WITHIN THE STIPULATED TIME AS ENVISAGED U/S 143(2). 4 7. AS WE HAVE ADJUDICATED GROUND NO.2 IN FAVOUR OF THE ASSESSEE, THE CONTENTION RAISED BY THE ASSESSEE IN GROUND NO.1 NE EDS NO SEPARATE ADJUDICATION AND THE SAME REMAINS AS OF AN ACADEMIC INTEREST. 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. DECISION PRONOUNCED IN THE OPEN COURT ON 9TH JUNE, 2011. SD/- SD/- (H.L. KARWA) (MEHAR SINGH) VICE PRESIDENT ACCOUNTANT MEMBER DATED: 9TH JUNE, 2011 /SKR/ COPY OF THE ORDER IS FORWARDED TO : 1. THE ASSESSEE: SMT. ANITA KAPOOR, PROP. CHENAB STEEL FABRICATIAONS, SAMBA 2. THE DCIT, CIR.1, JAMMU. 3. THE CIT(A), JAMMU. 4. THE CIT, JAMMU. 5. THE SR DR, AMRITSAR. TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH : AMRITSAR.