Ishwer Parkash, Kurukshetra V. ITO, Kurukshetra

ITA 418/CHANDI/2008

• Counselvise Citation: 41821514 RSA 2008
• Duration Of Justice: 3 year(s) 4 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-09-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 21-09-2011
• Assessment Year: 2000-2001
• Appeal Filed On: 06-05-2008
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: JAI SHREE SHARMA
• Assessee Lawyers: SUDHIR SEHGAL
• Keywords: Income from undisclosed sources; Corroborative evidences
• Section: 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH B CHANDIGARH BEFORE MS SUSHMA CHOWLA, JUDICIAL MEMBER AND SHRI MEHAR SINGH, ACCOUNTANT MEMBER ITA NO. 418/CHD/2008 ASSESSMENT YEAR: 2000-01 SHRI ISHWAR PARKASH, V ITO, WARD-1, C/O RAJINDERA BHATTA CO., KURUKSHETRA. MATHANA, KURUKSHETRA. PAN: AARPP-8491 (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI SUDHIR SEHGAL RESPONDENT BY: SMT. JAISHREE SHARMA DATE OF HEARING : 21.09.2011 DATE OF PRONOUNCEMENT : 29.09.2011 ORDER PER MEHAR SINGH, AM THIS APPEAL IS AGAINST THE ORDER DATED 18.02.2008 PASSED BY THE CIT(A) U/S 143(3)/147 OF THE INCOME-T AX ACT,1961 FOR THE ASSESSMENT YEAR 2000-01. 2. IN THE GROUNDS OF APPEAL, THE ASSESSEE CHALLENGE D ASSUMPTION OF JURISDICTION BY THE AO U/S 147 OF THE ACT ON SUSPICION AND SPECULATION AS WELL AS UPHOLDING OF T HE ADDITION MADE BY THE AO AND UPHELD BY THE CIT(A). 3. THE FACTS OF THE CASE, IN BRIEF ARE THAT NOTICE U/S 148 OF THE INCOME-TAX ACT,1961 (IN SHORT 'THE ACT') WAS IS SUED ON THE ASSESSEE ON 14.3.2005 AND IT WAS NOTICED DURING THE ASSESSMENT PROCEEDINGS FOR THE ASSESSMENT YEAR 2002 -03 THAT THE ASSESSEE HAD SHOWN FICTITIOUS CREDITS, IN THE N AME OF COAL-DEALERS IN THE YEAR UNDER CONSIDERATION. CERT AIN CREDIT 2 ENTRIES PERTAINED TO THE ASSESSMENT YEAR UNDER REFE RENCE. THE AO, ACCORDINGLY ISSUED NOTICE U/S 147 R.W.S. 14 8 OF THE ACT. 4. IN THE COURSE OF PRESENT APPELLATE PROCEEDINGS, THE LD. AR DREW OUR ATTENTION, TO THE RELEVANT PAGES OF T HE PAPER BOOK WHICH INTER-ALIA INCLUDED PURCHASE BILLS FROM M/S U.K.KAUR & COMPANY, NH-37, BELTOLA, GUWAHATI. THE LD. AR ALSO PLACED RELIANCE ON CERTAIN RELEVANT PAGES OF T HE PAPER BOOK AND CONTENDED THAT ADDITION IN RESPECT OF SUCH TRADE CREDITORS CANNOT BE MADE AS ALL THE RELEVANT INFORM ATION WAS PLACED BEFORE THE AO. 5. LD. DR, ON THE OTHER HAND, CONTENDED THAT THE ALLEGED PURCHASES FROM M/S U.K.KAUR & CO. ARE NOTHING BUT F ICTITIOUS ENTRIES WHICH ARE APPEARING IN THE BALANCE-SHEET OF THE ASSESSEE FOR THE RELEVANT PERIOD. PRIMARY ONUS LIE S ON THE ASSESSEE TO ESTABLISH THE GENUINENESS OF SUCH TRANS ACTIONS BY ADDUCING CREDIBLE AND CORROBORATIVE EVIDENCES. HOW EVER, THE ASSESSEE HAS FAILED TO FILE ANY MATERIAL WHICH COUL D PROVE HIS CONTENTIONS. THE ASSESSEE IS PRIMARILY RELYING ON THE SALE BILLS. IT IS, FURTHER, POINTED OUT BY THE LD. DR THAT THE GRIEVANCE OF THE ASSESSEE IS THAT DETAILED ENQUIRIE S WERE NOT MADE BY THE AO. 6. WE HAVE CAREFULLY PERUSED THE FACTS OF THE CASE, RIVAL SUBMISSIONS AND RELEVANT RECORD. THE BOOKS OF ACCOU NT BELONGED TO THE ASSESSEE AND CONSEQUENTLY TRANSACTI ONS INCORPORATED THEREIN ARE PURELY WITHIN THE EXCLUSIV E KNOWLEDGE OF THE ASSESSEE. THUS, ONUS TO ESTABLISH HIS CASE 3 ABOUT THE GENUINENESS OF SUCH PURCHASES FROM M/S U. K.KAUR &CO. SQUARELY LIES, ON THE ASSESSEE. MERELY FILING OF THE PURCHASE BILLS FROM M/S U.K.KAUR & CO. ALONGWITH EV IDENCE OF CARRIERS IS NOT SUFFICIENT TO ESTABLISH THE CASE OF THE ASSESSEE. SIMILARLY, MAKING OF PAYMENT IN CASH IS NO EVIDENCE TO ESTABLISH THE IDENTITY OF THE SELLER WHO COULD NOT BE TRACED DESPITE ENQUIRIES MADE BY THE AO. THE AO HAS ISSUED LETTER TO THE PARTY FROM WHOM THE ASSESSEE ALLEGEDLY MADE PUR CHASES, WHICH WAS RECEIVED BACK WITH THE POSTAL REMARKS IN COMPLETE ADDRESS. CAN IT BE PRESUMED THAT THE DEPARTMENT S HOULD KNOW THE COMPLETE ADDRESS OF THE PARTY WITH WHOM TH E ASSESSEE HAD COMMERCIAL TRANSACTIONS, IN THE FORM O F ALLEGED PURCHASE OF COAL ? THE ASSESSEE HAS PRODUCED THE C OPIES OF BILLS, THEREFORE, IT IS INCUMBENT UPON HIM TO GIVE COMPLETE ADDRESS OF THE SELLER. THE DEPARTMENT ISSUED COMMI SSION TO THE ITO AT GAUHATI U/S 131(D) OF THE ACT, FOR THE P URPOSE OF MAKING ENQUIRIES, WITH A VIEW TO ASCERTAIN THE GENU INENESS OF THE TRANSACTIONS. THE RESULT OF ENQUIRY DEMONSTRAT ED THAT THE ALLEGED PARTY IS NOT TRACEABLE. THE ASSESSEE FAILE D TO FILE EVEN THE CONFIRMATORY LETTERS FROM M/S U.K.KAUR & CO., C ONFIRMING THE ALLEGED TRANSACTIONS BETWEEN THE ASSESSEE AND T HE SAID PARTY. IN THE COURSE OF PROCEEDINGS, BEFORE THE AO FOR THE ASSESSMENT YEAR 2002-03, THE ASSESSEE WAS AFFORDED EFFECTIVE AND REASONABLE OPPORTUNITIES TO PRODUCE NECESSARY E VIDENCE IN RESPECT OF M/S U.K.KAUR & CO. AND M/S K.K.TRADIN G & CO. THE ASSESSEE FAILED TO FILE ANY CREDIBLE MATERIAL T O SUPPORT HIS CONTENTIONS. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS AGAIN PROVIDED OPPORTUNITIES BUT NO TANGIBLE EV IDENCES 4 WERE FILED BY THE ASSESSEE. NEEDLESS TO SAY THAT BA RE ASSERTION CANNOT BE A SUBSTITUTE FOR THE TANGIBLE AND CORROBO RATIVE EVIDENCES, INCUMBENT UPON THE ASSESSEE TO FILE, IN SUCH CASES. THE AO FOR THE ASSESSMENT YEAR 200-01 VALIDLY ISSUE D NOTICE U/S 147/148 OF THE ACT HAVING REGARD TO THE INFORMA TION AVAILABLE ON RECORD WITHIN THE MEANING OF THE SAID SECTIONS. THE AO AGAIN PROVIDED OPPORTUNITY TO THE ASSESSEE I N THE COURSE OF SUCH ASSESSMENT PROCEEDINGS. HOWEVER, TH E ASSESSEE MERELY REPEATED THE SAME BARE ASSERTIONS. THE ASSESSEE MERELY FILED THE SAME EVIDENCE IN THE FORM OF SALE BILLS ETC. IT IS A CASE WHERE FICTITIOUS CREDITS A RE APPEARING IN THE BOOKS OF ACCOUNT OF THE ASSESSEE WHICH WERE TR EATED BY THE AO AS NON-GENUINE CREDITORS AND HENCE, THE ADD ITION OF RS.4,14,363/-, WAS MADE BY THE AO. 7. THE LD. CIT(A), UPHELD THE ADDITION MADE BY THE AO. THE RELEVANT AND OPERATIVE PARA OF HIS FINDINGS IS REPR ODUCED HEREUNDER: I HAVE CONSIDERED THE FACTS OF THE CASE AND THE SUBMISSIONS OF THE ASSESSEE. THE ASSESSEE HAS NOT FILED ANY OTHER DETAIL OTHER THAN THE BILL FROM THE PARTY AND MERELY CLAIMED THAT AO HAS NOT MADE ANY INDEPENDENT ENQUIRY W.R.T. M/S U.K.KAUR & CO., IS N OT SUFFICIENT BECAUSE IT IS FOR THE ASSESSEE TO GIVE COMPLETE DETAILS, IDENTITY AND ADDRESS OF PARTY FRO M WHOM PURCHASES HAVE BEEN MADE AND PROVE THE GENUINENESS OF THE TRANSACTIONS WHICH THE ASSESSEE HAS FAILED TO DO. THEREFORE, THE ADDITION MADE BY T HE AO IS CONFIRMED AND THE GROUND OF APPEAL OF THE ASSESSEE IS REJECTED. 5 8. IT IS PERTINENT TO MENTION HERE THAT LD. CIT(A) HAS CONSIDERED NUMBER OF CASE LAWS CITED BY THE ASSESS EE, TO SUPPORT HIS CONTENTIONS, AS LISTED IN PARA 5 OF THE IMPUGNED APPELLATE ORDER. WE HAVE CAREFULLY PERUSED THE RATI O OF THE SAID CASES AND FOUND THAT THE SAME ARE NOT APPLICAB LE TO THE FACT SITUATION OF THE PRESENT CASE. HOWEVER, THE C ORE RATIO OF SUCH DECISIONS SUPPORTS THE CASE OF THE REVENUE AS THE ASSESSEE IS MERELY PLACING RELIANCE ON SURMISES AND CONJECTURES. AS THE AO CANNOT MAKE ADDITIONS ON TH E FOUNDATION OF BARE SURMISES AND CONJECTURES, THE AS SESSEE ALSO CANNOT PLACE RELIANCE ON SURMISES AND CONJECTU RES OR BARE ASSERTIONS, TO SUPPORT HIS CASE OF SUCH PURCHA SES. IT IS INCUMBENT UPON THE ASSESSEE TO BRING ON RECORD RELE VANT, COGENT AND CORROBORATIVE EVIDENCE, TO SUPPORT HIS TRANSACTIONS. THE IDENTITY OF PARTY IN WHOSE NAME C REDIT ENTRY IS APPEARING REMAINS UNEXPLAINED. SIMILARLY, PAYME NT THROUGH CHEQUE MAY LEAD TO TRACE THE IDENTITY OF TH E PARTY. IN THIS CASE, ONLY CASH PAYMENT HAS BEEN SHOWN AS THE MODE OF PAYMENT. THE ASSESSEE HAS FAILED TO FILE EVEN THE CONFIRMATION FROM SUCH PARTY WITH A VIEW TO ESTABLISH THE IDENTI TY AND GENUINENESS OF THE TRANSACTIONS. IN THE FACTUAL MAT RIX OF THE CASE, A REFERENCE IS MADE TO THE DECISION OF THE HO N'BLE DELHI HIGH COURT IN THE CASE OF CIT V LA MEDICA, 250 ITR 575 (DEL). THE RELEVANT PART IS REPRODUCED HEREUNDER : INCOME FROM UNDISCLOSED SOURCES-RAW MATERIAL PURCHASED BY ASSESSEE-ASSESSING OFFICER FINDING SELLER NON-EXISTENT AND TREATING AMOUNT OF PURCHASE PRICE AS INCOME FROM UNDISCLOSED SOURCES-TRIBUNAL HOLDING THAT NOTWITHSTANDING SUSPICIOUS 6 CIRCUMSTANCES PURCHASES WERE MADE AND PAYMENTS NOT TO BE DOUBTED-TRIBUNAL ACTION PARTLY ON RELEVANT AND PARTLY ON IRRELEVANT MATERIALS-NO MATERIAL TO CONCLUDE THAT SUM NOT TO BE TREATED AS INCOME FROM UNDISCLOSED SOURCE-FINDING OF TRIBUNAL VITIATED-INCOME TAX ACT,1961. 9. HAVING REGARD TO THE ABOVE LEGAL AND FACTUAL DIS CUSSION, THE FINDINGS OF THE LD. CIT(A) ARE UPHELD AND THE A PPEAL OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 29 TH SEPTEMBER,2011. SD/- SD/- (SUSHMA CHOWLA) (MEHAR SINGH) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 29 TH SEPT.,2011 POONAM COPY TO: 1. THE APPELLANT, 2. THE RESPONDENT, 3. THE CIT(A), 4. THE CIT 5. THE D.R, INCOME-TAX DEPARTMENT, CHANDIGARH ASSISTANT REGISTRAR, ITAT, CHANDIGARH