Pramila Khuntia, Cuttack V. ITO, Paradeep

ITA 367/CTK/2011

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 52398 (ITAT-CUTTACK)
• Duration Of Justice: 1 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-09-2011
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 16-08-2011
• Court: TRIBUNAL
• Department Lawyers: S C MOHANTYDR
• Assessee Lawyers: S N SAHU; K SAHOO

Judgement Text

IN THE INC O ME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK BEFORE : SHRI K.K.GUPTA, AM , AND SHRI K.S.S.PRASAD RAO, JM ITA NO. 367/CTK/2011 (ASSESSMENT YEAR 2007 - 08) SMT.PRAMILA KHUNTIA, AT/P.O.BANIMAL,DIST. KENDRAPARA PAN: APBPK 7668 N VERSUS INCOME - TAX OFFICER, WARD 2, PARADEEP. (APPELLANT) (RESPONDENT) FOR THE APPELLANT: SHRI S.N.SAHU & K.SAHOO, AR S FOR THE RESPONDENT SHRI S.C.MOHANTY,DR DATE OF HEARING : 16.09.2011 DATE OF PRONOUNCEMENT : 23.09.2011 ORDER SHRI K.K.GUPTA, AM : THIS APPEAL BY THE ASSESSEE IS AGAINST THE ORDER O F THE ASSESSING AUTHORITIES WHO HAVE CONFIRMED A TYPOGRAPHICAL ERROR BEING PURCHASE WRONGLY TYPED WITH A DIFFERENCE OF 10 LAKHS AS PERPETUATING WITHOUT ANY CORRESPONDING INCOME TO BE TAXED IN THE IMPU GNED ASSESSMENT YEAR. 2. THE BRIEF FACTS AS HAVE BEEN BROUGHT OUT ON RECORD ARE THAT ASSESSEE DERIVES INCOME FROM RETAIL SALES OF INDIAN MADE FOREIGN LIQUOR. RETURN OF INCOME HAS BEEN FILED ON 31.10.2007 TOGETHER WITH ACCOUNTS AUDITED U /S. 44AB OF INCOME - TAX ACT WITH FORM 3C. ASSESSMENT WAS COMPLETED U /S. 143 (1) OF THE I.T.ACT ON 15.09.2008. SUBSEQUENTLY THE CASE WAS REOPENED ON U/S. 147 WITH THE ALLEGATION THAT THE ASSESSEE HAS SHOWN LESS PURCHASE OF LIQUOR AMOUNTING TO 9,99,999 SHOWN IN P&L A/C. AS PE R FIGURE SHOWN IN T.C.S. CERTIFICATE ISSUED BY O.S.B.C. LIMITED, BHUBANESWAR. THE PROCEEDING WAS INITIATED AND NOTICE U/S. 148 WAS ISSUED U /S. 147 DATED 10.12.2008 AND S ERVED ON THE ASSESSEE. 22.12.08 . THE ASSESSMENT WAS COMPLETED U/S.144/147 BY MAKING ADD ITION OF 9,99,999 AS UNDISCLOSED INCOME. AGGRIEVED, THE ASSESSEE APPEALED BEFORE THE FIRST APPELLATE AUTHORITY WHO ITA NO.367/CTK/2011 2 DISMISSED THE ASSESSEES APPEAL WITHOUT ADMITTING THE SAME AS IT HAD BEEN FILED BELATEDLY BY 21 DAYS. 3. THE LEARNED COUNSEL FOR THE ASSESSEE INI TIATING HIS ARGUMENT SUBMITTED THAT ADEQUATE GROUNDS WERE SUBMITTED TO THE LEARNED CIT(A) FOR HAVING FILED THE APPEAL BELATEDLY WHICH HE CONSIDERED OTHERWISE AND CHOSE TO DISMISS THE APPEAL IN LIMINE WHEN THE BASIC MERIT OF THE ISSUE WAS A TYPOGRAPHICAL ER ROR IN ITS ENTIRETY AND NOT TO BE ISOLATED AS CONSIDERED BY THE ASSESSING OFFICER IN THE PROCEEDINGS U/S.144/147. HE POINTED OUT THAT THE CHARTERED ACCOUNTANT ON HAVING FOUND DIFFERENCE OF 1 0 LAKHS IN THE PURCHASES WHICH DID NOT CORRESPOND TO THE SALES IN ACCORDANCE WITH THE EXCISE DUTY POLICY OF THE GOVERNMENT AS AND WHEN THE EXCISE DUTY PAID ON LIQU OR IS LIFTED FROM GOVERNMENT BO NDED WARE - HOUSE THEREFORE COULD NOT BE CONSIDERED FOR DISALL OWANC E FOR PURCHASES AS AGAINST TAX COLLECTED AT SOURCE BY THE ASSESSEE WHEN THE LIQUOR WAS BROUGHT FROM GOVERNMENT BONDED WAREHOUSE WITH A DIFFERENCE OF 1 0 LAKHS. THE ASSESSING AUTHORITIES WITHOUT CARING TO VERIFY THE SALES WHICH EXACTLY DIFFERED BY A SU M OF 10 LAKHS CHOSE TO ADD BACK 9,99,999 WHEN THE AMOUNT WAS ROUNDED UP BY IGNORING 52 PAISA. THEREFORE,. HE SUBMITTED BY FURNISHING THE BALANCE SHEET THAT WHEN NO DISCREPANCY HAS BEEN POINTED OUT EITHER BY THE ASSESSING OFFICER OR THE LEARNED CIT(A) TO BE ADJUDICATED UPON MAY KINDLY BE CONSIDERED BY THE TRIBUNAL IN ITS ENTIRETY. 4. THE LEARNED DR SUPPORTED THE ORDER OF THE LEARNED CIT(A) AND CONTENDED THAT THE ASSESSEE DID NOT HAVE BONAFIDE REASON FOR FILING THE APPEAL BEFORE HIM BELATEDLY. HOWEVER, ON M ERITS HE POINTED OUT THAT THE ISSUE WAS CONSIDERED UNDER THE PROVISIONS OF SECTION 147 WHEN THE DIFFERENCE ON THE BASIS OF TAX COLLECTED AT SOURCE BY EXCISE DUTY AUTHORITIES WERE FOUND VARYING INSOFAR AS THE PURCHASES DECLARED BY THE ASSESSEE WERE EXACTLY LESS BY 10 LAKHS. THE ASSESSING OFFICER THEREFORE RIGHTLY TREATED THIS AS INCOME ITA NO.367/CTK/2011 3 FROM OTHER SOURCES WHICH HAD NOT BEEN RENDERED TO TAX MAY KINDLY BE CONFIRMED. 5. HAVING HEARD BOTH THE PARTIES AND PERUSING THE MATERIAL AVAILABLE ON RECORD, WE ARE OF THE C ONSIDERED VIEW THAT THE TYPOGRAPHICAL ERROR CREPT IN THE FINANCIAL STATEMENTS WHEN THE TAX COLLECTED AT SOURCE INDICATED THE PURCHASE OF 1,18,15,816 AND THE ASSESSEE HA D RETURNED A FIGURE OF 1 ,08,15,816 WHEN 52 PAIS A W AS ROUNDED TO BY THE ASSESSING OFFI CER TO BRING TO TAX A SUM OF 9,99,999 AS PURCHASES NOT DECLARED. THE SALES AGAINST THE SAID PURCHASES CORRESPONDINGLY ALSO WERE SHOWN AT 1,30,17,641 WHEN THE ASSESSING OFFICER CH OSE TO CONSIDER THE SALES AT 1 ,20,17,642. THIS TYPOGRAPHICAL ERROR IS COMP UTER GENERATED AND THEREFORE COULD NOT BE HELD AGAINST THE ASSESSEE HAS BEEN RIGHTLY SUBMITTED BY THE LEARNED COUNSEL FOR THE ASSESSEE. THE ASSESSING OFFICER IN HIS ORDER U/S.144/147 HAS NOT UNDERTAKE N AS TO HOW T HE SALES HAD INCREASED WITHOUT GIVING ANY E FFECT TO THE STOCK HELD BY THE ASSESSEE ON THE CLOSING DATE THEREFORE REQUIRED CONSIDERATION INSOFAR AS IT WAS NOT THE CASE OF THE ASSESSEE TO NOT DISCLOSE ONLY THE PURCHASES BUT THE SALES ALONE. WE HAVE VERIFIED THE FINANCIAL STATEMENTS PURSUANT TO BOTH T HE FIGURES WHICH INDICATE THAT THE DISALLOWANCE OF PURCHASES CANNOT BE TAXED IN THE HANDS OF THE ASSESSEE INSOFAR AS ALL THE INCOMES FROM SALES HAVE BEEN RENDERED TO TAX BY THE ASSESSEE. THIS CLINCHES THE ISSUE IN FAVOUR OF THE ASSESSEE THAT IT WAS A TYPOG RAPHICAL ERROR WHICH HAS BEEN HELD AGAINST THE ASSESSEE UNJUSTIFIABLY. THEREFORE, THE ADDITION MADE IN THIS RESPECT IS HEREBY DIRECTED TO BE DELETED. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. SD/ - SD/ - (K.S.S.PRASAD RAO) JUDICIAL MEMB ER (K.K.GUPTA) ACCOUNTANT MEMBER DATE: 23 RD SEPTEMBER, 2011 H.K.PADHEE, SENIOR PRIVATE SECRETARY. ITA NO.367/CTK/2011 4 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT: SMT.PRAMILA KHUNTIA, AT/P.O.BANIMAL,DIST. KENDRAPARA 2. THE RESPONDENT: INCOME - TAX OFFICER, WARD 2, PARADEEP. 3. THE CIT, 4. THE CIT(A), 5. THE DR, CUTTACK 6. GUARD FILE (IN DUPLICATE) TRUE COPY, BY ORDER, SENIOR PRIVATE SECRETARY.