M/s. New India Enterprise, Baroda V. The DY.CIT., Cent.Circle-1, Baroda

ITA 380/AHD/2006

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 0575 (ITAT-AHMEDABAD)
• Duration Of Justice: 10 year(s) 6 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-09-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 01-09-2016
• Assessment Year: 1999-2000
• Appeal Filed On: 16-02-2006
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH (BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER & SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER) ITA. NO: 380/AHD/2006 & 4276/AHD/2007 (ASSESSMENT YEAR: 1999-2000) M/S. NEW INDIA ENTERPRISE 101,OVERSEAS AVENUE, NATUBHAI CENTRE RACE COURSE, BARODA M/S. NEW INDIA ENTERPRISE 101,OVERSEAS AVENUE, NATUBHAI CENTRE RACE COURSE, BARODA V/S V/S THE DCIT, CENTRAL CIRCLE- 1, BARODA THE ASSISTANT COMMISSIONER OF INCOME- TAX, CIRCLE2(2), BARODA (APPELLANT) (RESPONDENT) PAN: AABFN5979Q APPELLANT BY : SHRI MILIN MEHTA, A.R. RESPONDENT BY: SHRI SANJAY AGRAWAL , CIT/DR WITH SHRI SANJAY KUMAR, S R. D.R. ( )/ ORDER DATE OF HEARING : 01 -09-201 6 DATE OF PRONOUNCEMENT : 07-09-2016 PER N.K. BILLAIYA, ACCOUNTANT MEMBER: 1. THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST TH E ORDER OF THE LD. CIT(A)-IV, AHMEDABAD DATED 30.12.2005 PERTAINING TO A.Y. 1999- 2000. ITA NO. 380/AH D/2006 & 4276/AHD/2007 . A.Y. 1999-20 00 2 2. THE SOLE GRIEVANCE OF THE ASSESSEE RELATES TO THE A DDITION OF RS. 18,33,958/- MADE BY THE A.O. AND CONFIRMED BY THE L D. CIT(A). 3. ASSESSEE IS IN THE BUSINESS OF TRADING IN CHEMICALS & TRANSPORTATION. THE RETURN OF INCOME WAS FILED ON 04.08.1999 DECLAR ING TOTAL INCOME AT RS. 1,87,725/-. THE ASSESSMENT WAS COMPLETED U/S. 1 43(3) OF THE ACT ON 22.03.2002 AT RS. 1,87,725/- THEREBY ACCEPTING T HE RETURNED INCOME. 4. SUBSEQUENTLY, ASSESSEE FILED A PETITION U/S. 273A B EFORE THE CIT, CENTRAL II, AHMEDABAD ON 15.04.2004 WHEREIN ADDITI ONAL INCOME OF RS. 5,97,215/- WAS ACCEPTED AS ADDITIONAL INCOME EA RNED FOR THE YEAR UNDER CONSIDERATION. IT WAS EXPLAINED THAT THE SAME WAS LEFT TO BE INCLUDED IN THE ORIGINAL RETURN OF INCOME FILED ON 04.08.1999. 5. WHILE SCRUTINIZING THE RETURN OF INCOME, THE A.O. F OUND THAT THE ASSESSEE OWNS TANKERS WHICH ARE RUN ON HIRE IN THE NAME OF M/S. NEW INDIA TRANSPORT COMPANY WHICH ACCORDING TO THE A.O. IS A DUMMY CONCERN OF THE GROUP. THE A.O. FOUND THAT THE RECEI PTS PERTAINING TO THE TRANSPORTATION INCOME WERE DEPOSITED IN THE BAN K ACCOUNT OF M/S. NEW INDIA TRANSPORT COMPANY FROM WHICH PART OF THE RECEIPTS WERE TRANSFERRED BY CHEQUE TO MS. NEW INDIA ENTERPRISES TOWARDS TANKERS HIRING CHARGES. THE A.O. ALSO FOUND THAT M/S. NEW I NDIA ENTERPRISE BOOKED ALL THE EXPENDITURES PERTAINING TO THE RUNNI NG OF THE TANKERS. THE A.O. WAS OF THE OPINION THAT THE ASSESSEE HAS B OOKED ALL THE EXPENSES BUT HE IS SHOWING ONLY PART OF THE TRANSPO RTATION RECEIPT THEREBY SUPPRESSING THE INCOME. ITA NO. 380/AH D/2006 & 4276/AHD/2007 . A.Y. 1999-20 00 3 6. ON FURTHER PROBE, THE A.O. FOUND THAT THE ASSESSEE HAS NOT OFFERED THE ENTIRE UNDISCLOSED INCOME IN THIS ASSESSMENT YEAR. TAKING A LEAF OUT OF THE TDS CLAIM AT RS. 75,987/-, THE A.O. WAS OF THE OPINION THAT THE TRANSPORTATION INCOME SHOULD BE AT RS. 37,99,078/-. THE A.O. FOUND THAT RS. 1,67,436/- HAS BEEN SHOWN BY M/S. NEW IND IA TRANSPORT COMPANY AS ITS INCOME AND RS. 12,00,469/- HAS BEEN RECORDED IN THE BOOKS OF M/S. NEW INDIA ENTERPRISE. DEDUCTING THESE TWO AMOUNTS FROM THE TRANSPORTATION INCOME COMPUTED AS PER THE TDS CERTIFICATE AT RS. 37,99,078/-, THE A.O. MADE AN ADDITION OF RS. 1 8,33,958/-. 7. AGGRIEVED BY THIS, THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) AND STRONGLY CONTENDED THAT THE ASSESSEE HAS BEEN SHOWING THE TRANSPORTATION RECEIPTS IN RESPECT OF THE AMOUN TS CREDITED IN ITS BANK ACCOUNT. IT WAS BROUGHT TO THE NOTICE OF THE F IRST APPELLATE AUTHORITY THAT THE TDS CERTIFICATES WERE RECEIVED S UBSEQUENTLY AND, THEREFORE, THE ASSESSEE HAS BEEN SHOWING ONLY THOSE TRANSPORT RECEIPTS WHICH HAVE BEEN CREDITED IN ITS BANK ACCOUNTS. THER EFORE, THERE IS A MISMATCH BETWEEN THE TDS CERTIFICATE AND THE TRANSP ORTATION RECEIPTS. 8. THIS SUBMISSION OF THE ASSESSEE DID NOT FIND ANY FA VOUR WITH THE LD. CIT(A) WHO CONFIRMED THE ASSESSMENT. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE REITERATED WHAT HAS BEEN STATED BEFORE THE LOWER AUTHORITIES. IT IS THE SAY OF THE LD. COUNSEL THAT THIS PRACTICE HAS BEEN FOLLOWED BY THE ASSESSEE SINCE LAST 3 YEARS AND HAS BEEN ACCEPTED BY THE ASSESSING OFFICER AND IT IS ONLY IN THE YEAR UN DER CONSIDERATION, THIS TREATMENT OF TRANSPORTATION RECEIPTS HAVE BEEN DISTURBED BY THE A.O. ITA NO. 380/AH D/2006 & 4276/AHD/2007 . A.Y. 1999-20 00 4 9. PER CONTRA, THE LD. D.R. STRONGLY SUPPORTED THE FIN DINGS OF THE REVENUE AUTHORITIES. 10. AFTER CONSIDERING THE FACTS IN ISSUE, THE BENCH ASK ED THE LD. COUNSEL TO SHOW THE TRANSPORTATION RECEIPTS IN THE YEARS IN WHICH THEY HAVE BEEN CREDITED IN THE BANK ACCOUNTS. THE LD. CO UNSEL FAIRLY CONCEDED THAT IT IS NOT POSSIBLE AFTER A GAP OF 16 YEARS TO DEMONSTRATE THAT THE INCOME HAS BEEN SHOWN IN EARLIER ASSESSMEN T YEARS BY BRINGING THE BANK STATEMENTS ON RECORD. BUT, THE LD . COUNSEL STRONGLY STATED THAT THE INCOME HAS ACTUALLY BEEN OFFERED IN EARLIER ASSESSMENT YEARS. 11. WITHOUT ANY DEMONSTRATION/EVIDENCE, WE ARE LEFT WIT H NO CHOICE BUT TO CONFIRM THE ADDITION OF RS. 18,33,958/-. APP EAL FILED BY THE ASSESSEE IS ACCORDINGLY DISMISSED. ITA NO. 4276/AHD/2007 ASSESSEES APPEAL FOR A.Y. 1999-2000 12. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-II, BARODA DATED 29.10.2007 PERTAINING T O ASSESSMENT YEARS 1998-99 TO 2002-03. 13. THE ONLY GRIEVANCE OF THE ASSESSEE RELATES TO THE P ENALTY OF RS. 9,00,000/- LEVIED BY THE A.O. U/S. 271(1)(C) OF THE ACT AND CONFIRMED BY THE LD. CIT(A). 14. THE ROOTS FOR THE LEVY OF PENALTY LIE IN THE ASSESS MENT ORDER DATED 31.03.2005 MADE U/S. 143(3) R.W.S. 147 OF THE ACT. THE ITA NO. 380/AH D/2006 & 4276/AHD/2007 . A.Y. 1999-20 00 5 ASSESSMENT WAS COMPLETED BY MAKING AN ADDITION RS. 18,33,958/- PERTAINING TO THE SUPPRESSION OF TRANSPORT RECEIPTS QUA THE TDS CERTIFICATE. THE QUANTUM ADDITION WAS CHALLENGED B EFORE THE FIRST APPELLATE AUTHORITY BUT WITHOUT ANY SUCCESS. THE PE NALTY HAS BEEN LEVIED BY THE A.O. ACCORDINGLY. 15. AGGRIEVED BY THIS, THE ASSESSEE IS BEFORE US. 16. THE LD. COUNSEL FOR THE ASSESSEE VEHEMENTLY STATED THAT THESE ALLEGED SUPPRESSION OF TRANSPORTATION RECEIPTS HAVE BEEN DULY EXPLAINED IN THE QUANTUM PROCEEDINGS. IT IS THE SA Y OF THE LD. COUNSEL THAT THE TRANSPORTATION RECEIPTS HAVE BEEN SHOWN AS INCOME IN VARIOUS ASSESSMENT YEARS AND THE ASSESSEE HAS BEEN SHOWING THE TRANSPORT INCOME ON THE BASIS OF CHEQUES ACTUALLY RECEIVED AN D DEPOSITED IN THE RESPECTIVE ASSESSMENT YEARS. THEREFORE, THERE IS A POSSIBILITY OF MISMATCH BETWEEN THE TDS CERTIFICATE AND THE ACTUAL AMOUNT OF QUOTATION RECEIPT SHOWN. 17. PER CONTRA, THE LD. D.R. STRONGLY SUPPORTED THE ORD ERS OF THE AUTHORITIES BELOW. 18. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE FAC TS AT THE TIME OF THE ADJUDICATION IN ITA NO. 380/AHD/2006. WE HAVE C ONSIDERED THE FACTUAL MATRIX AT THE ASSESSMENT STAGE AND HAVE CON FIRMED THE QUANTUM ADDITION BY THE ORDER OF EVEN DATE. 19. HOWEVER, PENAL PROCEEDINGS ARE DIFFERENT FROM ASSES SMENT PROCEEDINGS. ALTHOUGH, THE ADDITIONS HAVE BEEN CONF IRMED BY US BUT IT WOULD BE PERTINENT TO SEE THE FINDINGS IN THE QUANT UM PROCEEDINGS WHICH READ AS UNDER:- ITA NO. 380/AH D/2006 & 4276/AHD/2007 . A.Y. 1999-20 00 6 AFTER CONSIDERING THE FACTS IN ISSUE, THE BENCH AS KED THE LD. COUNSEL TO SHOW THE TRANSPORTATION RECEIPTS IN THE YEARS IN WHICH THEY HAVE BEEN CREDITED IN THE BANK ACCOUNTS. THE LD. COUNSEL FAIRLY CONCEDED THAT IT I S NOT POSSIBLE AFTER A GAP OF 16 YEARS TO DEMONSTRATE THAT THE INCOME HAS BEEN SHOWN IN EARLIER ASSESSMENT YEARS BY BRINGING THE BANK STATEMENTS OF RECORD. BUT, THE LD. COUNSEL STRONGLY STATED THAT THE INCOME HAS ACTUALLY BEEN OFFERED IN EARLIER ASS ESSMENT YEARS. WITHOUT ANY DEMONSTRATION/EVIDENCE, WE ARE LEFT WIT H NO CHOICE, BUT TO CONFIRM THE ADDITION OF RS. 18,33,958/-. 20. A PERUSAL OF THE AFOREMENTIONED FINDINGS OF THE BEN CH CLEARLY SHOWS THAT THE ADDITIONS HAVE BEEN CONFIRMED ONLY B ECAUSE AFTER A GAP OF 16 YEARS, IT WAS NOT POSSIBLE FOR THE ASSESS EE TO BRING DEMONSTRATIVE MATERIAL EVIDENCES ON RECORD TO SHOW THAT THE TRANSPORTATION RECEIPTS HAVE ACTUALLY BEEN SHOWN IN VARIOUS ASSESSMENT YEARS. 21. IN OUR CONSIDERED OPINION, THE TRANSPORTATION INCOM E HAS BEEN SHOWN IN VARIOUS ASSESSMENT YEARS, BUT FOR SUPPORTI NG EVIDENCES THE ADDITION HAS BEEN CONFIRMED. THEREFORE, THE PENALTY LEVIED BY THE A.O. IS UNCALLED FOR. WE, ACCORDINGLY, SET ASIDE THE FIN DINGS OF THE LD. CIT(A) AND DIRECT THE A.O. TO DELETE THE PENALTY OF RS. 9, 00,000/-. 22. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ACCORDINGLY ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 07 - 09- 20 16. SD/- SD/- (RAJPAL YADAV) (N. K. BILLAIYA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD: TRUE COPY RAJESH