SUKRUT TRADING CO., MUMBAI V. ITO WD 23(2)(4), MUMBAI

ITA 3876/MUM/2011

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 8816 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-09-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 13-09-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 12-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR MANJUNATH KANKIHALLI
• Assessee Lawyers: HARI S RAHEJA
• Keywords: Opportunity of being heard
• Section: 143(3); 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH E MUMBAI BEFORE SHRI D.K. AGARWAL, JUDICIAL MEMBER AND SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER ITA NO. 3876/MUM/2011 ASSESSMENT YEAR- 2007-08 M/S. SUKRUT TRADING COMPANY, 606, SAMBHAV APT. SARVODAYA NAGAR, JAIN MANDIR ROAD, MULUND(W), MUMBAI-400 080 PAN-ABEFS 7373P VS. THE ITO, WARD 23(2)(4), MUMBAI (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI HARI S. RAHEJA RESPONDENT BY: DR. MANJUNATH KANKIHALLI DATE OF HEARING :13.09.2012 DATE OF PRONOUNCEMENT: 26.9.2012 O R D E R PER N.K. BILLAIYA, AM: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF LD. CIT(A)- 33, MUMBAI DT. 18.3.2011 PERTAINING TO ASSESSMENT Y EAR 2007-08. 2. THE ASSESSEE HAS RAISED FOLLOWING SUBSTANTIVE GR OUNDS OF APPEAL: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) WAS NOT JUSTIFIED IN REJECTING THE CLAIM OF THE APPELLANT IN CONFIRMING THE ADDITION OF RS. 27,61,915/- MADE BY THE AO. 2. APPELLANT SUBMITS THAT THE ALLEGATIONS MADE BY T HE AO WITH REGARD TO THE FILING OF RETURN OF INCOME ELECT RONICALLY DELIBERATELY UNDER THE WRONG PAN IS BASELESS INCORR ECT AS WILL BE BORNE OUT FROM THE COPY OF THE ACKNOWLEDGE MENT OF THE RETURN OF FILING OF INCOME AND FURTHER THE ITA NO. 3876/M/2011 2 ALLEGATION OF THE CIT(A) THAT THE APPELLANT HAS NOT CO- OPERATED WITH THE DEPARTMENT IS ALSO UNCALLED FOR A S THE APPELLANT HAS FURNISHED ALL NECESSARY DETAILS INCLU DING THE ACKNOWLEDGEMENT OF FILING OF RETURNS BY THE SUNDRY CREDITORS WHICH THE CIT(A) HAS WRONGLY STATED THAT THE SAME DO NOT BEAR THEIR RESPECTIVE PAN NUMBERS OR SE RIAL NUMBER AND WARD. 3. THE APPELLANT SUBMITS THAT PROPER AND REASONABLE OPPORTUNITY HAS NOT BEEN GRANTED BY THE AO AND HE H AS NOT CORRECTLY APPRECIATED THE EVIDENCE FILED BEFORE HIM AND THAT HE HAS RELIED UPON INCORRECT DATA THEREBY ALLEGING MALICE AT THE HANDS OF THE APPELLANT. 3. THE SUM AND SUBSTANCE OF ASSESSEES GRIEVANCE IS THAT THE ASSESSEE WAS DEPRIVED OF REASONABLE OPPORTUNITY BY THE LOWER AUT HORITIES TO PRESENT AND EXPLAIN ITS CASE. 4. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT TH E ASSESSEE IS A PARTNERSHIP FIRM WHICH FILED ITS RETURN ELECTRONICALLY ON 28.10 .2007 DECLARING TOTAL INCOME AT RS. 80,214/-. THE SAID RETURN WAS SELECTED FOR S CRUTINY ASSESSMENT AND ACCORDINGLY STATUTORY NOTICES WERE ISSUED AND SERVE D UPON THE ASSESSEE. A PERUSAL OF THE ASSESSMENT ORDER SHOW THAT THE ASSES SEE DID NOT FILE ALL THE DETAILS SOUGHT BY THE AO WHICH PROMPTED THE AO TO P ASS THE ASSESSMENT ORDER U/S. 144 R.W.S. 143(3) OF THE ACT AT RS. 27,9 9,920/-. 5. THE MATTER WAS CARRIED BEFORE THE LD. C1T(A) . T HE ASSESSEE FILED DETAILS IN THE FORM OF PAPER BOOK BEFORE THE LD. CIT(A) WHICH WAS TRANSMITTED TO THE AO BY THE LD. CIT(A) CALLING FOR A REMAND REPORT. T HE LD. CIT(A) HAS REPRODUCED THE REMAND REPORT IN HER ORDER AT PAGES 2 TO 4. AFTER RECEIVING REMAND REPORT, THE LD. CIT(A) GAVE AN OPPORTUNITY T O THE ASSESSEE TO FURNISH COMMENTS ON THE SAME. IN RESPONSE TO WHICH, THE ASS ESSEE FURNISHED FURTHER DOCUMENTS ON 17.3.2011. AFTER CONSIDERING THE FACTS AND SUBMISSIONS OF THE CASE AND THE DOCUMENTS SUBMITTED BY THE ASSESSEE, T HE LD. CIT(A) HELD THAT THE ASSESSEE HAS FAILED TO SUPPLY EVIDENCES SUPPORT ING THE TRANSACTION OF PURCHASES AND EXPENSES INCURRED AND CONFIRMED THE A DDITIONS MADE BY THE AO. ITA NO. 3876/M/2011 3 6. THE ASSESSEE IS IN APPEAL BEFORE US AGAINST THI S FINDINGS OF LD. C1T(A). BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE ARGUED THAT THE ASSESSEE HAS FILED ALL THE COPIES OF ACCOUNTS BEFORE THE AO INSPITE OF THAT THE ASSESSMENT HAS BEEN COMPLETED EX PARTE U/S. 144 OF THE ACT. THE LD. COUNSEL FURTHER SUBMITTED THAT THE AO HAS MADE ADHOC DISALL OWANCE WHICH ARE ARBITRARY AND AGAINST THE FACTS OF THE CASE. THE LD . COUNSEL FURTHER DREW OUR ATTENTION THAT THE BOOKS OF ACCOUNTS WERE UNDER THE CUSTODY OF DECEASED PARTNER AND THEREFORE COULD NOT BE MADE AVAILABLE D URING THE PROCEEDINGS BEFORE THE LOWER AUTHORITIES. THE LD. COUNSEL CONCL UDED THAT IF GIVEN AN OPPORTUNITY, THE ASSESSEE WILL COMPLY WITH ALL THE NECESSARY DETAILS/DOCUMENTS. THE LD. DEPARTMENTAL REPRESENTAT IVE STRONGLY SUPPORTED THE FINDINGS OF AO. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PE RUSED THE ORDERS OF LOWER AUTHORITIES AND THE PAPER BOOK SUBMITTED BY T HE ASSESSEE. IT IS NOT DISPUTED BY THE ASSESSEE THAT REQUISITE DETAILS/EXP LANATIONS WERE NOT MADE AVAILABLE TO THE AO. HOWEVER, AT THE SAME TIME IT C ANNOT BE DISPUTED THAT AUDITED STATEMENTS OF ACCOUNTS WERE AVAILABLE BEFOR E THE AO. THE EXPLANATION OF THE ASSESSEE THAT BOOKS OF ACCOUNTS COULD NOT BE MADE AVAILABLE BECAUSE OF THE DEMISE OF ONE OF THE PARTNERS WHO WAS IN POS SESSION OF THE BOOKS OF ACCOUNTS CANNOT BE BRUSHED ASIDE LIGHTLY. CONSIDERI NG THE FACTS OF THE CASE IN TOTALITY, IN OUR CONSIDERED VIEW, ENDS OF JUSTICE W OULD BE MET IF ONE MORE OPPORTUNITY IS GRANTED TO THE ASSESSEE TO PRESENT I TS CASE AND SUBSTANTIATE ITS CLAIM BEFORE THE AO. ACCORDINGLY, WE SET ASIDE THE IMPUGNED ORDER PASSED BY THE LD. CIT(A) AND RESTORE THE ISSUE BACK TO THE FI LE OF THE AO. THE ASSESSEE IS DIRECTED TO COMPLY WITH ALL THE NECESSARY DOCUME NTS/DETAILS/EXPLANATIONS TO SUBSTANTIATE ITS CLAIM OF EXPENSES AND GENUINENESS OF THE CREDITORS. THE AO IS DIRECTED TO ADJUDICATE THE ISSUE DENOVO ON MERITS A FTER PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. ITA NO. 3876/M/2011 4 4. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE I S ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THIS 26 TH DAY OF SEPTEMBER, 2012 SD/- SD/- (D.K. AGARWAL) (N.K. BILLAIYA ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED 26 TH SEPTEMBER, 2012 RJ COPY TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT-CONCERNED 4. THE CIT(A)-CONCERNED 5. THE DR E BENCH TRUE COPY BY ORDER ASSTT. REGISTRAR, I.T.A.T, MUMBAI