The ITO, Ward-2(2), Surat V. M/s. Maruti Prints, Surat

ITA 3654/AHD/2008

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 6165 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 8 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-07-2011
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 21-07-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 07-11-2008
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Gross profit estimation; Opportunity of being heard; Additional evidence
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL : C BENCH : AHMEDABAD (BEFORE HONBLE SHRI T.K. SHARMA, J.M. & HONBL E SHRI A.N.PAHUJA, A.M.) I.T.A. NO. 3654/AHD./2008 ASSESSMENT YEAR : 2005-2006 THE I.T.O., WARD-2(2), SURAT -VS- M/S. MARUTI PRINTS, SURAT (PAN : AAEFM 1258L) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SANJAY DHARIWAL, D.R. RESPONDENT BY : NONE (ACKNOWLEDGEMENT ON REC ORD) O R D E R PER SHRI T.K. SHARMA, JUDICIAL MEMBER : THIS APPEAL FILED BY THE REVENUE IS AGAINST THE OR DER DATED 27-08-2008 OF LEARNED COMMISSIONER OF INCOME TAX(APPEALS)-II, SUR AT FOR THE ASSESSMENT YEAR 2005-06. 2. DESPITE THE SERVICE OF NOTICE THROUGH REGISTERED POST WITH AD, NONE WAS PRESENT ON THE DATE OF HEARING I.E. ON 21.07.2011. WE, THEREFORE, PROCEED TO DECIDE THIS APPEAL ON THE BASIS OF SUBMISSIONS MADE BY THE LD. D.R. AND THE MATERIALS AVAILABLE ON RECORD. 3. VARIOUS GROUNDS RAISED IN THIS APPEAL BY THE REV ENUE ARE AS UNDER: [1] ON THE FACT AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED CIT(A)-I, SURAT HAS ERRED IN NOT CALLING FOR THE REMAND REPOR T UNDER RULE 46A IN RESPECT OF NEW EVIDENCES SUBMITTED BY THE ASSESSEE BEFORE HIM DURING THE APPELLATE PROCEEDINGS WHICH THE ASSESSEE HAD NOT PRODUCED BEF ORE THE ASSESSING OFFICER DURING THE ASSESSMENT PROCEEDINGS IN SPITE OF SPECI FICALLY AND REPEATEDLY REQUESTED FOR BY THE ASSESSING OFFICER. [2] ON THE FACT AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED CIT(A)-I, SURAT HAS ERRED IN DELETING THE ADDITION MADE BY TH E A.O. OF RS.19,20,715/- MADE BY THE A.O. ON ACCOUNT OF LOW GROSS PROFIT DISCLOSE D BY THE ASSESSEE. ITA NO.3654/AHD/2008 2 4. BRIEFLY STATED, THE FACTS ARE THAT THE ASSESSEE IS A FIRM ENGAGED IN THE WHOLESALE TEXTILE BUSINESS. FOR THE ASSESSMENT YEAR UNDER APP EAL, IT FILED THE RETURN OF INCOME ON 30.09.2005 DECLARING THE TOTAL INCOME AT RS.35,665/ -. THE AO FRAMED THE ASSESSMENT UNDER SECTION 143(3) ON 30.11.2007 AT A TOTAL INCOM E OF RS.21,15,700/-. IN THE ASSESSMENT ORDER, THE AO MADE ADDITION ON ACCOUNT O F G.P. AMOUNTING TO RS.19,20,715/-. 5. ON APPEAL, IN THE IMPUGNED ORDER, THE LD. CIT(A) DELETED THE ADDITION. AGGRIEVED WITH THE ORDER OF THE LD. CIT(A), THE REV ENUE IS IN APPEAL BEFORE THE TRIBUNAL. 6. AT THE TIME OF HEARING BEFORE US, SHRI SANJAY DH ARIWAL, SR.D.R. APPEARED ON BEHALF OF THE REVENUE AND POINTED OUT THAT THE ADDI TION OF RS. 19,20,715/- MADE BY THE AO IS DELETED ON THE GROUND THAT ALL THE DEFECTS PO INTED OUT BY THE AO HAD BEEN SATISFACTORILY EXPLAINED AND RECONCILED BY THE ASSE SSEE ALONG WITH APPROPRIATE DETAILS AND EVIDENCES DURING THE COURSE OF APPELLATE PROCEE DINGS. THE LD. D.R. POINTED OUT THAT THIS DECISION OF THE LD. CIT(A) IS NOT ACCEPTA BLE FOR THE FOLLOWING REASONS: [A] THE ADDITIONAL EVIDENCES CLAIMED TO HAVE B EEN PRODUCED BEFORE THE APPELLATE AUTHORITY WERE NEVER PRODUCED BEFORE THE ASSESSING OFFICER IN SPITE OF THE REPEATED OPPORTUNITIES GIVEN TO THE ASSESSEE AS CAN BE SEEN IN THE ORDER SHEET ENTRIES AVAILABLE IN THE ASSESSMENT FOLDER. [B] THE LD.CIT(A) HAD NOT GIVEN AN OPPORTUNITY TO THE A.O. BEFORE ADMITTING THE ADDITIONAL EVIDENCE IN ORDER TO GIVEN NATURAL J USTICE TO THE REVENUE. THEREFORE, THE UNILATERAL DECISION OF THE LD.CIT(A) IS NOT ACC EPTABLE. 6.1 ON THE BASIS OF ABOVE, THE LD. D.R. CONTENDED T HAT THE LD. CIT(A) SHOULD NOT HAVE ACCEPTED THE EXPLANATION/FRESH EVIDENCES WITHO UT CALLING REMAND REPORT FROM THE AO UNDER RULE 46A IN RESPECT OF NEW EVIDENCES SUBMI TTED BY THE ASSESSEE BEFORE HIM, DURING THE APPELLATE PROCEEDINGS. THEREFORE, T HE ORDER OF THE LD. CIT(A) BE SET ASIDE AND THE ADDITION MADE BY THE AO BE RESTORED. 7. AFTER HEARING THE LD. D.R., WE HAVE CAREFULLY GO NE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. FROM THE PERUSAL OF THE IMPUGNED ORDER, WE ARE CONVINCED THAT THE LD. CIT(A) HAS ACCEPTED THE FRESH EVIDENCES WITHOUT CALLING REMAND REPORT UNDER RULE ITA NO.3654/AHD/2008 3 46A OF THE I.T. ACT, 1961. WE, THEREFORE, SET ASIDE THE ORDER OF THE LD. CIT(A) AND RESTORE THE CONTROVERSY INVOLVED IN THIS APPEAL TO HIM WITH THE DIRECTION THAT THE LD. CIT(A) WILL CALL THE REMAND REPORT FROM THE AO AND ALSO AFFORD AN OPPORTUNITY OF BEING HEARD TO HIM AND THEREAFTER RE-ADJUDICATE THE ADDITION OF RS. 19,20,715/-, AFTER GIVING OPPORTUNITY OF BEING HEARD TO BOTH THE SIDES . RESULTANTLY, THE APPEAL OF THE REVENUE IS TREATED AS ALLOWED FOR STATISTICAL PURPO SES. 8. IN THE RESULT, FOR STATISTICAL PURPOSES, THE APP EAL FILED BY THE REVENUE IS TREATED AS ALLOWED. THE ORDER PRONOUNCED IN THE COURT ON 21.07.2011 SD/- SD/- (A.N.PAHUJA) (T.K. S HARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 21/07/2011 COPY OF THE ORDER IS FORWARDED TO:- (1) THE ASSESSEE (2) THE DEPARTMENT. (3) CIT (A.) CONCERNED. (4) CIT CONCERNED. (5) D.R., ITAT, AHMEDABAD. TRUE COPY BY ORDER DEPUTY REGISTRAR, ITAT, AH MEDABAD. TALUKDAR/ SR. P.S.