DCIT, New Delhi V. Sh. Sanjay Bansal, New Delhi

ITA 3860/DEL/2010

• Counselvise Citation: 386020114 RSA 2010
• Duration Of Justice: 1 year(s) 7 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-03-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 26-03-2012
• Assessment Year: 2001-2002
• Appeal Filed On: 13-08-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S MOHANTY
• Keywords: Business income; Revised return
• Section: 143(3); 148; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G: NEW DELHI BEFORE SHRI S.V. MEHROTRA, ACCOUNTANT MEMBER AND SMT. DIVA SINGH, JUDICIAL MEMBER ITA NO. 3860/DEL/2010 ASSESSMENT YEAR: 2001-02 DCIT, CIRCLE 26(1), ROOM NO. 214, D BLOCK, VIKAS BHAWAN, NEW DELHI. VS. SANJAY BANSAL, PROP. M/S PARICHAY ADVERTISING, 37, RANI JHANSI ROAD, NEW DELHI. AFCPB6739E (APPELLANT) (RESPONDENT) APPELLANT BY : S. MOHANTY, DR RESPONDENT BY : NONE O R D E R PER S.V. MEHROTRA, A.M. THIS APPEAL IS FILED BY THE REVENUE AND DIRECTED A GAINST THE ORDER OF LD. CIT(A) DATED 18.03.2010 FOR THE A.Y. 2001-02 . 2. IN THIS CASE, THE ASSESSEE HAD FILED ORIGINAL RE TURN OF INCOME DECLARING AN INCOME OF RS. 1,24,180/- AND THE ASSES SMENT U/S 143(3) WAS COMPLETED AT AN INCOME OF RS. 1,88,830/-. SUBSEQUE NTLY, NOTICE U/S 148 WAS ISSUED. THE ASSESSING OFFICER HAS OBSERVED THA T AS PER PROFIT AND LOSS ACCOUNT THE TOTAL RECEIPTS WERE SHOWN AT RS. 4 ,62,16,773/- AS DETAILED BELOW: - 1. BY BILL OUTWARDS 4,62,02,128 2. BY INTEREST RECEIVED 14,578 3. BY SHORT AND EXCESS 67 TOTAL RECEIPTS 4,62,16,773 ITA NO. 3860/D/2010 2 3. HE HAS FURTHER OBSERVED THAT AS PER TDS CERTIFIC ATE ATTACHED WITH THE RETURN AND FILED LATER ON, THE TOTAL AMOUNT OF RECEIPTS CREDITED WAS 5,34,64,118/- AS DETAILED BELOW: - S.NO. NATURE OF PAYMENT AMOUNT PAID/CREDITED AMOUNT OF TDS 1. ADVERTISING 9,012 100 2. INTT. ON DEPOSIT 14,368 1609 3. PAYMENT TO SUB CONTRACTOR 19,71,108 21,697 4. ADVERTISING 4,14,359 5,159 5. ADVERTISEMENT 5,10,55,271 56,1609 TOTAL 5,34,64,118 4. IN VIEW OF ABOVE DETAILS, THE AO CONCLUDED THAT INCOME HAD BEEN UNDER ASSESSED BY RS. 72,47,345/-. THE AO HAS OBSE RVED THAT TDS CERTIFICATES HAD BEEN ISSUED FOR THE PERIOD 20.04.2 000 TO 31.03.2001. HE HAS NOTED THAT M/S PARICHAY ADVERTISING W.E.F. 20.0 4.2000 TO 31.10.2000 WAS A FIRM HAVING SHRI SANJAY BANSAL AND SMT. JYOTI JAIN AS PARTNERS AND AFTER THAT THE FIRM HAD BEEN DISSOLVED AND IT BECAM E PROPRIETORSHIP OF SH. SANJAY BANSAL, PROPRIETOR M/S PARICHAY ADVERTISING W.E.F. 01.11.2000 TO 31.03.2001. HE HAS OBSERVED THAT IN THE FIRST PERI OD I.E. 01.04.2000 TO 31.10.2000, THE FIRM HAD SHOWN RECEIPTS OF RS. 5,66 ,96,926/- AND FOR THE PERIOD FROM 01.11.2000 TO 31.03.2001, THE RECEIPTS HAD BEEN SHOWN AT RS. 4,62,02,128/-. IT WAS EXPLAINED THAT THE RECEI PTS AS PER TDS CERTIFICATES FOR WHOLE PERIOD I.E. 20.04.2000 TO 31 .03.2001 WERE MUCH LESS THAN THE RECEIPT SHOWN IN THE PROFIT AND LOSS ACCOU NT FOR BOTH THE PERIODS. THE AO DID NOT ACCEPT THE ASSESSEES CONTENTION AND POINTED OUT THAT SINCE ASSESSEE HAD FILED AN APPLICATION U/S 154 CLA IMING THE TDS IN HIS HANDS I.E. SH. SANJAY BANSAL, PROP. M/S PARICHAY AD VERTISING AND ALSO FILED AN APPLICATION U/S 119(2)CLAUSE (B) FOR CONDO NATION OF DELAY AND WAS CLAIMING REFUND IN HIS INDIVIDUAL CAPACITY, THE CON TENTION OF ASSESSEE COULD NOT BE ACCEPTED AND, THEREFORE, THE RECEIPTS SHOWN AS PER TDS CERTIFICATES WERE CONSIDERED IN HIS HANDS. HE FURT HER POINTED OUT THAT IN THE TDS CERTIFICATES, THERE WAS NO MENTION TO WHOM THE SAME CONCERNED, WHETHER TO FIRM OR TO INDIVIDUAL. AS ASSESSEE FAIL ED TO PRODUCE BOOKS OF ACCOUNT, THE AO TREATED THE SUM OF RS. 72,47,345/- AS UNDISCLOSED ITA NO. 3860/D/2010 3 INCOME OF THE ASSESSEE. LD. CIT(A) AFTER DETAILED CONSIDERATION OF ASSESSEES SUBMISSIONS ALONGWITH REMAND REPORT OF A O, INTER-ALIA, CONCLUDED THAT THE AO HAD IGNORED THE RECEIPTS WHIC H WERE SHOWN BY THE PARTNERSHIP FIRM IN THE EARLIER PERIOD AND, THEREFO RE, HE RESTRICTED THE ADDITION TO RS. 17,310/- ONLY OBSERVING IN PARA 20 & 21 AS UNDER: - 20. THE APPELLANT HAS ALSO POINTED OUT THAT THE A SSESSMENTS FOR BOTH THE PARTNERSHIP FIRM AND THE PROPRIETARY SHIP CONCE RN HAVE BEEN SEPARATELY COMPLETED U/S 143(3) AFTER SCRUTINY , AND NO ADDITION TOWARDS SUPPRESSED SALES HAS BEEN MADE. I N HIS REPORT DATED 10.11.2009, THE AO HAS REFERRED TO CERTAIN DI SCREPANCIES IN THE FIGURES FURNISHED BY THE APPELLANT. THE APP ELLANT HAS GIVEN A DETAILED REPLY IN THIS REGARD WHICH HAS BEE N DISCUSSED IN PARAS 11 TO 15 ABOVE. THE APPELLANT HAS FILED A RECONCILIATION (PARA 14) OF THE SALES AMOUNT SHOWN BY THE ASSESSEE DURING ASSESSMENT PROCEEDINGS. HE HAS ALS O FILED A RECONCILIATION (PARA 15) OF TDS CERTIFICATES WITH S ALES OF M/S AKAI INDIA. THE RECONCILIATIONS FILED BY THE APPEL LANT SATISFACTORILY EXPLAIN THE DISCREPANCIES REFERRED T O BY THE AO IN THE REMAND REPORTS AND THE ASSTT. ORDER. HOWEVER, THERE IS A DIFFERENCE OF RS. 17,310/- BETWEEN THE BILL AMOUNT AND THE BILLS AS PER THE TDS CERTIFICATES. THIS AMOUNT HAS NOT B EEN EXPLAINED AND SHOULD THEREFORE, BE ADDED TO INCOME. 21. THE APPELLANT HAS ALSO POINTED OUT THAT THE PRO PRIETORSHIP CONCERN HAS TAKEN OVER ALL THE ASSETS AND LIABILITI ES OF THE PARTNERSHIP FIRM AND THERE IS NO BAR IN SECTION 199 , FOR TAKING CREDIT OF TDS CERTIFICATES AS ALL THE TDS CERTIFICA TES PERTAIN TO THE A.Y. 2001-02 AND THE RELEVANT RECEIPTS HAVE ALS O BEEN SHOWN IN THE SAME A.Y. IT IS CLEAR THAT IN MAKING THE ADDITION, THE AO HAS IGNORED THE RECEIPTS WHICH WERE SHOWN BY THE PARTNERSHIP FIRM IN THE EARLIER PERIOD. IN VIEW OF THESE FACTS, THE ADDITION MADE BY THE AO IS NOT JUSTIFIED AND IS DELETED EXCEPT FOR THE DIFFERENCE OF RS. 17,310/- WHICH HAS REMAINED UN-RECONCILED, AS DISCUSSED IN PARA 20 ABOVE. CONS EQUENTLY, THE APPELLANT GETS RELIEF OF RS. 72,30,035/- (72,47 ,345 17,310). THE GROUND IS PARTLY ALLOWED. 5. WE HAVE CONSIDERED THE SUBMISSIONS OF LD. DR AND HAVE PERUSED THE RECORD OF THE CASE. ADMITTEDLY M/S PARICHAY AD VERTISING WAS A PARTNERSHIP FIRM FROM 20.04.2000 TO 31.10.2000 WITH SH. SANJAY BANSAL AND SMT. JYOTI JAIN AS PARTNERS. THE FIRM WAS DISS OLVED ON 31.10.2000 ITA NO. 3860/D/2010 4 AND M/S PARICHAY ADVERTISING BECAME A PROPRIETORSHI P CONCERN OF SH. SANJAY BANSAL W.E.F. 01.11.2000. ALL ASSETS AND LI ABILITIES OF M/S PARICHAY ADVERTISING (FIRM) WERE TAKEN OVER BY SH. SANJAY BA NSAL IN HIS PROPRIETARY CONCERN. BEFORE LD. CIT(A), THE ASSESSEE HAD FILED A CHART GIVING DETAILS OF TDS CERTIFICATES AND THE CORRESPONDING SALES FOR THE PERIOD DURING WHICH M/S PARICHAY ADVERTISING WAS A PARTNERSHIP FI RM AND THE PERIOD DURING WHICH IT BECAME PROPRIETARY CONCERN. THE AS SESSEE HAD ALSO FILED A CHART GIVING DETAILS OF THE TDS CLAIMS AND THE RE CEIPTS AS PER BOOKS FOR THE TWO PERIODS. AS PER DETAILS AVAILABLE ON RECOR D, OUT OF TOTAL RECEIPTS/CREDITS OF RS. 5,34,64,118/- A SUM OF RS. 5,25,06,714/- PERTAINS FOR THE PERIOD FROM APRIL TO 31 ST OCTOBER, 2000 UPTO THE DATE OF DISSOLUTION OF PARTNERSHIP FIRM AND ONLY A SUM OF RS. 9,57,404/ - PERTAINS FOR THE PERIOD FROM 01.11.200 TO 31.03.2001. IN THE PROFIT AND LOSS ACCOUNT OF THE FIRM, THE GROSS RECEIPTS HAD BEEN SHOWN AT RS. 5,67 ,28,551/- AGAINST THE RECEIPT SHOWN IN THE TDS CERTIFICATE AT RS. 5,53,41 ,780/-. IT WAS FURTHER SUBMITTED BEFORE LD. CIT(A) THAT THE ASSESSEE HAD C LAIMED THE TDS OF RS. 47253/- IN THE HANDS OF THE FIRM, SINCE IN THE RESP ECTIVE TDS CERTIFICATES RECEIPTS/SALES ONLY FOR THE PERIOD FROM APRIL, 2000 TO OCTOBER, 2000 WERE INCLUDED, WHEREAS IN THE FIVE TDS CERTIFICATES RECE IPTS/SALES FOR BOTH THE PERIODS WERE INCLUDED WHICH WERE CLAIMED BY THE ASS ESSEE IN HIS RETURN I.E. IN INDIVIDUAL CAPACITY. IT WAS FURTHER SUBMIT TED AS UNDER: - THE LD. AOS CONTENTION THAT THE GROSS RECEIPTS A S PER TDS CERTIFICATES AMOUNTING RS. 5,34,64,118/- BELONGS TO THE ASSESSEE IS CONTRADICTORY AND AGAINST THE FACTS ON RECORDS, SIN CE IT IS AN ADMITTED FACT THE PARICHAY ADVERTISING BECAME THE PROPRIETAR Y CONCERN OF THE ASSESSEE W.E.F. 01/11/2000. THEREFORE, THE RECEIPT S SHOWN IN THE TDS CERTIFICATES FOR THE EARLIER PERIOD ARE OBVIOUSLY B ELONGS TO THE FIRM AND ACCORDINGLY HAVE BEEN SHOWN IN THE PROFIT & LOS S A/C OF THE FIRM AND HAS BEEN ASSESSED IN THE HAND OF THE FIRM U/S 1 43(3) VIDE ORDER DT. 25/03/2004 WHICH WAS FILED SEPARATELY AND ASSESSED ACCORDINGLY. 2. IT IS PERTINENT TO MENTION THAT THE DULY AUDITED ACCOUNTS BY THE CHARTERED ACCOUNTANTS U/S 44AB HAVE BEEN FILED AND THERE IS NO SUPPRESSION OF SALE AS ALLEGED BY THE LD. AO. THE LD. AOS CONTENTION ITA NO. 3860/D/2010 5 IS AGAINST THE FACTS ON RECORD. YOUR GOODSELF WILL APPRECIATE THE FACT THAT THE DIFFERENCE OF RECEIPTS SHOWN IN TDS CERTIF ICATES AND AS SHOWN IN PROFIT & LOSS A/C CANNOT BE CONSIDERED AS UNDER STATEMENT OF INCOME AS THERE ARE OTHER INCOME ALSO INCLUDED IN T HE PROFIT & LOSS A/C FOR WHICH NO TDS CERTIFICATES IS RECEIVED BY TH E ASSESSEE. FOR EXAMPLE THERE IS A SALES AMOUNTING TO RS. 4,24,32,2 38/- MADE TO JAP INFOTECH FROM WHICH NO TDS IS RECEIVED BUT THE SALE S IS INCLUDED IN THE SALES SHOWN IN THE PROFIT & LOSS A/C. SIMILARLY TH ERE ARE OTHER ADVERTISING RECEIPTS INCLUDED IN THE PROFIT & LOSS A/C FOR WHICH ALSO NO TDS CERTIFICATES HAVE BEEN RECEIVED. YOUR KIND ATTENTION IS DRAWN TO THE COPY OF LEDGER ACCOUNT OF AKAI INDIA, WHICH IS ALREADY ON RECORD. FROM THE P ERUSAL OF THE LEDGER ACCOUNT OF YOUR GOODSELF WILL OBSERVE THAT T HE OPENING BALANCE OF RS. 2,91,60,409/- WHICH TALLIES WITH THE CLOSING BALANCE AS ON 31/10/2000, THIS CAN BE VERIFIED FROM THE BALANCE S HEET OF THE FIRM AS ON 31/10/2000. YOUR GOODSELF WILL ALSO OBSERVE THAT THERE ARE ONL Y FIVE BILLS OF SALES FOR THE PERIOD FROM 01/11/2000 AND THE TOTAL OF THE SAME IS WORKED RS. 4,27,924/- AND ALL THESE FIVE INVOICES A RE INCLUDED IN THE TDS CERTIFICATE ISSUED BY M/S AKAI INDIA FOR THE PE RIOD FROM APRIL, 2000 TO MARCH, 2001. FROM THE COPY OF ACCOUNT OF M/S AKAI INDIA FOR THE PERIOD FROM APRIL, 2000 TO OCTOBER, 2000 THE INVOICES AS SHOWN IN THE TOTAL RECEIPT AND AS SHOWN IN THE LEDGER ACCOUNT ARE SAME WHICH A RE INCLUDED IN THE TOTAL RECEIPT AS SHOWN IN THE PROFIT & LOSS A/C OF THE FIRM. FROM THESE FACTS YOUR GOODSELF WILL OBSERVE THAT THE PAR TY I.E. M/S AKAI INDIA HAS ISSUED THE TDS CERTIFICATES FOR THE WHOLE YEAR AND THE ASSESSEE HAS SHOWN THE TOTAL RECEIPTS SPLITTING INT O TWO PERIODS FROM 01/04/2000 TO 31/10/2000 RS. 5,06,27,347/- AND BALA NCE OF RS. 4,27,924/- FOR THE PERIOD FROM 01/11/2000 TO 31/03/ 2001. SIMILARLY FROM OTHER FOUR CERTIFICATES YOUR GOODSELF WILL OBS ERVE THAT THE RECEIPTS OF THE BOTH THE PERIOD ARE INCLUDED. DETA ILS AS UNDER: - S.NO. PARTY NAME TOTAL PAYMENT ON TDS UPTO 31/10/2000 FROM 01/11/2000 TO 31/03/01 TDS 1. VIDEOCON 9,012.00 NIL 9,012.00 100.00 2. CANARA BANK (INTEREST) 14,368.00 NIL 14,368.00 1,609.00 3. SOFTLINE MEDIA LD. 19,71,108.00 16,18,458.00 3,52,650.00 21,697.00 4. GDA 4,14,359.00 2,60,909.00 1,53,450.00 5,159.00 5. AKAI (INDIA) 5,10,55,271.00 5,06,27,3 47.00 4,27,924.00 5,61,609.00 TOTAL RS. 5,34,64,118.00 5,25,06,714.00 9,57,404.00 5,90,174.00 SIMILARLY YOUR KIND ATTENTION IS DRAWN TO THE COPY OF ACCOUNT OF M/S JAP INFOTECH FROM THE SAME YOUR GOODSELF WILL O BSERVE THAT THERE IS OPENING BALANCE OF RS. 74,009/- WHICH TALLIES WI TH THE CLOSING ITA NO. 3860/D/2010 6 BALANCE SHOWN IN THE BALANCE SHEET OF THE FIRM AS O N 31/10/2000 AND DURING THE PERIOD FROM 1 ST DAY OF NOVEMBER, 2000 TO 31 ST MARCH, 201 TOTAL SALES TO M/S JAP INFOTECH WORKED OUT OF RS. 4 ,24,32,238/- AS PER SUMMARY OF THE LEDGER ACCOUNT ATTACHED FOR YOUR KIN D PERUSAL. FOR WHICH NO TDS CERTIFICATE HAS BEEN RECEIVED BY THE A SSESSEE AND THESE RECEIPTS/SALES ARE INCLUDED IN THE TOTAL RECEIPTS O F RS. 4,62,16,73/-. FROM THE ABOVE YOUR GOODSELF WILL OBSERVE THAT THE RE IS NO APPLICATION OF MIND AND INFERENCE DRAWN BY THE LD. AO IS NOT ONLY ERRONEOUS BUT AGAINST THE FACTS OF CASE ON RECORD. 3. SINCE THE BUSINESS CONTINUED UNDER THE SAME NAME AND STYLE AND THE PARTIES HAVE ISSUED TDS CERTIFICATES FOR WH OLE YEAR THE SAME HAS BEEN CLAIMED BY THE ASSESSEE IN THE RETURN FOR THE LATER PERIOD, WHERE THE INCOME HAS BEEN SPLIT INTO TWO PERIODS. THIS FACT IS ALREADY ON RECORD AND MAY BE VERIFIED FROM THE TDS CERTIFIC ATES ALREADY ON RECORD. THEREFORE, TO ALLEGE THE ASESSEE HAS FAILE D TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR HIS ASSE SSMENT IS AGAINST THE FACTS ALREADY ON RECORD. 4. THAT DURING THE PERIOD FROM APRIL, 2000 TO OCTOB ER, 2000 IN THE RETURN OF FIRM THE ASSESSEE HAS CLAIMED TDS AMOUNTI NG RS. 47,253/- AGAINST THE TOTAL RECEIPTS OF RS. 28,35,066/- AS PE R TDS CERTIFICATES. WHEREAS IN THE PROFIT AND LOSS A/C FOR THE SAME PER IOD THE GROSS RECEIPTS HAVE BEEN SHOWN RS. 5,67,28,551/-. IT CLE ARLY ESTABLISHES THAT THE RECEIPTS SHOWN DURING THIS PERIOD PERTAINS TO T HE TDS CERTIFICATES CLAIMED IN THE LATER PERIOD I.E. FROM 01/11/2000 TO 31/03/2001. FURTHER IT IS PERTINENT TO MENTION THAT THE TOTAL S ALES/RECEIPTS HAVE BEEN SHOWN BY THE ASSESSEE FOR THE WHOLE YEAR IN TH E BOOKS AND AS PER TDS CERTIFICATES ARE AS UNDER: PERIOD RECEIPTS/SALES (AS PER BOOKS) TDS CLAIMED (AS PER TDS CERTIFICATE) APRIL TO OCTOBER, 20001 NOVEMBER TO MARCH, 2001 5,67,28,551/- 4,62,16,773/- 5,53,41,780/- (28,35,066 + 5,25,06,714) 9,57,404/- TOTAL RS. 10,29,45,324/- 5,62,99,184/- AFTER CONSIDERING THE DETAILED SUBMISSIONS OF ASSES SEE AS WELL AS REMAND REPORT, LD. CIT(A) CONCLUDED THAT RECONCILIATIONS F ILED BY THE ASSESSEE SATISFACTORILY EXPLAINED THE DISCREPANCIES REFERRED TO BY AO IN REMAND REPORT EXCEPT TO THE EXTENT OF RS. 17310/- BETWEEN THE BILL AMOUNT AND THE BILLS AS PER TDS CERTIFICATES. THE FINDINGS OF LD. CIT(A) HAVE NOT BEEN CONTROVERTED. THE BASIC PREMISE ON WHICH THE ENTIR E RE-ASSESSMENT PROCEEDINGS WERE INITIATED WAS FACTUALLY NOT CORREC T INASMUCH AS OUT OF TOTAL GROSS RECEIPTS AS PER TDS CERTIFICATES OF RS. 53464118/-, SUM OF RS. ITA NO. 3860/D/2010 7 52506714/- WAS ALREADY INCLUDED IN FIRMS RECEIPTS. THIS FACT HAS NOT BEEN CONTROVERTED BY DEPARTMENT. THE AO IGNORED THIS AS PECT BECAUSE ASSESSEE HAD FILED PETITION U/S 154 AND HAD ALSO FI LED CONDONATION PETITION FOR FILING REVISED RETURN U/S 119(2)(B). THIS, IN OUR OPINION, COULD NOT AFFECT THE TAXABILITY OF RECEIPTS. THE RECEIPTS PERTAININ G TO FIRM COULD NOT BE TAXED IN THE HANDS OF INDIVIDUAL. UNDER SUCH CIRCU MSTANCES LD. CIT(A)S FINDINGS, AS REPRODUCED EARLIER REMAIN UNCONTROVERT ED. WE, THEREFORE, DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF LD. CIT(A). 6. IN THE RESULT, THE DEPARTMENTS APPEAL IS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT ON 26.03.2012 SD/- SD/- (DIVA SINGH) JUDICIAL MEMBER (S.V. MEHROTRA) ACCOUNTANT MEMBER DATED: 26.03.2012 *KAVITA COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, NEW DELHI. TRUE COPY BY ORDER DEPUTY REGISTRAR