M/s. Highrise Construction, Valsad V. The ACIT.,Vapi Circle, Vapi

ITA 397/AHD/2009

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 1004 (ITAT-AHMEDABAD)
• Duration Of Justice: 7 year(s) 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-07-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 28-06-2016
• Assessment Year: 2005-2006
• Appeal Filed On: 06-02-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SHIV SEWAK
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH BEFORE: SHR I S. S. GODARA , JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER M/S. HIGHRISE CONSTRUCTIONS, 210, GIDC, ESTATE, UMBERGAM, VALSAD PAN: AADFH3037K (APPELLANT) VS THE ACIT, VAPI CIRCLE, VAPI (RESPONDENT) REVENUE BY : S H RI SHIV SEWAK , SR. D . R. ASSESSEE BY: S H RI MEHUL SHAH , A.R. DATE OF HEARING : 28 - 06 - 2 016 DATE OF PRONOUNCEMENT : 22 - 07 - 2 016 / ORDER P ER : S. S. GODARA , JUDICIAL MEMBER : - THIS ASSESSEE S APPEAL FOR A.Y. 2 005 - 06 , AR IS ES FROM ORDER OF THE CIT(A), VALSAD DATED 26 - 11 - 2008 IN APPEAL NO. CIT(A)/VLS/103/08 - 09 , IN PROCEEDINGS UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . I T A NO . 397 / A HD/20 09 A SSESSMENT YEAR 200 5 - 06 I.T.A NO. 397 /AHD/20 09 A.Y. 2005 - 06 PAGE NO M/S. HIGHRISE CONSTRUCTIONS VS. ACIT 2 2. THE ASSESSEE RAISES FOLLOWING SUBSTANTIVE GROUNDS IN THE INSTANT A PPEAL. 1) THE LEARNED ASSESSING OFFICER ERRED IN ADDING A SUM OF RS.51,40,000/ - , BEING THE INTRODUCTION OF CAPITAL BY THE PARTNERS AS INCOME OF THE APPELLANT WITHOUT APPRECIATING THE FACT AND CIRCUMSTANCES OF THE CASE THAT THE SAID SUM HAD ALREADY BEEN OFFERED AND ACCEPTED IN THE ASSESSMENT U/S.143(3) OF THE INCOME TAX ACT' 1961 OF THE SAID PARTNERS. 2) THE LEARNED ASSESSING OFFICER ERRED IN ADDING A SUM OF R S. 3,33,459/ - AS INFLATED PURCHASES FOR THE PURCHASES WITH M/S. JAY ENTERPRISES ALLEG ING THAT THE APPELLANT HAD ENTERED TRANSACTIONS WHICH HAD NOT ACTUALLY BEEN ENTERED INTO WHEREAS IT WAS ACTUALLY THE SAID PARTY WHICH HAD NOT RECORDED THE TRANSACTION DONE WITH THEM. 3) THE LEARNED ASSESSING OFFICER ERRED IN ADDING A SUM OF RS .17,16 ,368/ - AS INFLATED PURCHASES FOR THE PURCHASES WITH M/S. PATIL BANDU TRANSPORT ALLEGING THAT THE APPELLANT HAD ENTERED TRANSACTIONS WHICH HAD NOT ACTUALLY BEEN ENTERED INTO WHEREAS IT WAS ACTUALLY THE SAID PARTY WHICH HAD NOT RECORDED THE TRANSACTION DON E WITH THEM. 3. LEARNED COUNSEL SUBMITS AT THE OUTSET THAT BOTH THE LOWER AUTHORITIES HAVE MADE THE FIRST ADDITION OF RS. 51,40,000/ - AS CAPITAL INTRODUCED BY ASSESSE E S PARTNERS ON AGREED BASED DURING THE COURSE OF SCRUTINY . HE STATES THAT LAW IS VERY WELL SETTLED THAT SUCH AN ADDITION IS TO BE MADE IN PARTNER S HANDS. HE CONTENDS THAT HE WOULD NOT RAISE THE CORRESPONDING LEGAL ARGUMENT IF WE ADOPT A FAIR GP RATIO IN RESPECT TO TWO LATTER GROUNDS OF INFLATED PURCHASES AMOUNTING TO RS. 3,33,459/ - AND RS . 17,16,368/ - ; RESPECTIVELY. 4. THE REVENUE STRONGLY SUPPORTS THE CIT(A) S ORDER ON ALL THREE COUNTS. I.T.A NO. 397 /AHD/20 09 A.Y. 2005 - 06 PAGE NO M/S. HIGHRISE CONSTRUCTIONS VS. ACIT 3 5. WE HAVE HEARD BOTH THE PARTIES. THERE IS NO DISPUTE THAT THE ASSESSEE HAD ITSELF AGREED FOR ADDITION OF ITS PARTNER S CAPITAL CONTRIBUTIONS IN QUESTION AMOUNTING TO RS. 51.4 LACS RIGHT FROM SCRUTINY UPTO THE LOWER APPELLATE PROCEEDINGS. THIS IS NOT ITS CASE THAT THE SAME HAS BEEN WRONGLY MADE ON SURRENDER BASIS. WE CONCLUDE IN THESE FACTS THAT THIS FIRST SUBSTANTIVE GROUND IS NOT MAINTAINABLE I N THE INSTANT SECOND APPEAL PROCEEDINGS. WE CONFIRM THE IMPUGNED ADDITION ACCORDINGLY . 6. NOW WE COME TO THE LATTER INFLATED PURCHASES ADDITIONS. THE ASSESSING OFFICER VERIFIED ASSESSEE S PURCHASE CLAIM S FROM ITS TWO SUPPLIERS. THE SAME WERE FOUND TO H AVE BEEN INFLATED TO THE EXTENT INDICATED HEREINABOVE. THERE IS NO DISPUTE ON CORRECTNESS THEREOF. THE ASSESSEE ALSO DOES NOT PRODUCE EVEN LEDGER ACCOUNT OF ITS SUPPLIERS IN SUPPORT O F THE PURCHASES IN QUESTION. WE FIND NO REASON TO INTERFERE IN RESPECT OF THESE TWO LATTER ADDITIONS AS WELL. THE SAME ARE CONFIRMED. 7. THIS ASSESSEE S APPEAL IS DISMISSED. ORDER PR ONOUNCED IN THE OPEN C OURT ON 22 - 07 - 201 6 SD/ - SD/ - ( MANISH BORAD ) ( S. S. GODARA ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD : DATED 22 /07 /2016 I.T.A NO. 397 /AHD/20 09 A.Y. 2005 - 06 PAGE NO M/S. HIGHRISE CONSTRUCTIONS VS. ACIT 4 AK / COPY OF ORDER FORWARDED TO: - 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,