ACIT, Jaipur V. ALLIED GEMS CORPORATION, Jaipur

ITA 418/JPR/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 99469 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 28-05-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: PUROSHOTTAM KASHYAP
• Assessee Lawyers: RAJIV SOGANI
• Keywords: Opportunity of being heard

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH VKJ-IH-RKSYKUH] U;KF;D LNL; ,OA JH FOE FLAG ;KN O] YS[KK LNL; DS LE{K BEFORE: SHRI R.P. TOLANI, JM & SHRI VIKRAM SINGH YA DAV, AM VK;DJ VIHY LA- @ ITA NO. 418/JP/2014 FU/KZKJ.K O'K Z @ ASSESSMENT YEARS : 2005-06 ASSTT. COMMISSIONER OF INCOME TAX, CIRCLE-1, JAIPUR. CUKE VS. M/S ALLIED GEMS CORPORATION, BANDHIYA BHAWAN, JOHARI BAZAR, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AACFA 2928 D VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS @ REVENUE BY : SHRI PUROSHOTTAM KASHYAP (ADDL. CIT) FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI RAJIV SOGANI (CA) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 03/11/2015 MN?KKS'K .KK DH RKJH[ K@ DATE OF PRONOUNCEMENT : 06/11/2015 VKNS'K@ ORDER PER: VIKRAM SINGH YADAV, A.M.: THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER DATED 21/03/2014 PASSED BY THE LD CIT(A)-I JAIPUR FOR A.Y. 2005-06. THE SOLE GROUND OF APPEAL IS REPRODUCED AS UNDER:- 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE AND IN LAW THE LD. CIT(A) HAS ERRED IN DELETING ITA 418/JP/2014_ ACIT VS. M/S ALLIED GEMS CORP 2 THE PENALTY U/S 271(1)(C) OF THE ACT OF RS. 4,22,278/. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSES SEE FIRM IS ENGAGED IN THE BUSINESS OF MANUFACTURING AND TRADING OF PRE CIOUS AND SEMI PRECIOUS STONES UNDER THE NAME AND STYLE OF M/S ALL IED GEMS CORPORATION. THE ASSESSEE HAD FILED ITS RETURN OF IN COME ON 31/10/2005 DECLARED TOTAL INCOME OF RS. 31,83,227/-. THE LD AS SESSING OFFICER COMPLETED THE ASSESSEE U/S 263/143(3) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) VIDE ORDER DATED 27/12/2010 AT A TOT AL INCOME OF RS. 1,31,10,510/- AND DISALLOWED TRADING ADDITION OF RS. 96,69,746/- AND ADDED IN THE INCOME OF THE ASSESSEE. THE LD ASSESSIN G OFFICER ALSO IMPOSED PENALTY OF RS. 4,22,278/-. 3. IN FIRST APPEAL, THE LD CIT(A) HAS ALLOWED THE APP EAL BY HOLDING THAT THE ADDITION OF RS. 96,69,746/- WAS MADE BY THE ASSESSING OFFICER BY APPLYING 25% G.P. RATE ON UNVERIFIABLE PURCHASES , AFTER REJECTING THE BOOKS OF ACCOUNT. THE SAID ESTIMATED ADDITION WAS RED UCED IN THE FIRST APPEAL TO RS. 11.54 LACS. THUS, THE APPELLANT WAS GRA NTED SUBSTANTIAL RELIEF BY THE APPELLATE AUTHORITY. FOR APPEAL AGAIN ST THE LEVY OF PENALTY, THE LD CIT(A) HELD THAT THE ADDITION HAS BEEN MADE O N ESTIMATE BASIS AND THERE IS NOTHING TO SHOW THAT THERE WAS CONCEALME NT OF INCOME OR ITA 418/JP/2014_ ACIT VS. M/S ALLIED GEMS CORP 3 FURNISHING OR INACCURATE PARTICULARS OF INCOME. THER EFORE, HE CANCELLED THE PENALTY IMPOSED BY THE ASSESSING OFFICER. 4. NOW THE DEPARTMENT IN APPEAL BEFORE US. THE LD DR HAS RELIED ON THE ORDER OF THE LD ASSESSING OFFICER. 5. AT THE OUTSET, THE LD AR OF THE ASSESSEE HAS SU BMITTED THAT IN THE APPELLATE PROCEEDINGS IN QUANTUM APPEAL, WHICH WAS DE CIDED BY THE HONBLE BENCH IN ITA NO. 716/JP/2012 AND 794 &795/J P/2011 ORDER DATED 17/7/2015, IT SET ASIDE THE MATTER TO THE FIL E OF THE ASSESSING OFFICER. THIS MEANS THAT THE ADDITIONS MADE BY THE L D ASSESSING OFFICER AND PARTLY SUSTAINED BY THE LD CIT(A) DO NOT SUBSIS T. THUS THE RETURNED INCOME POSITION IS RESTORED. THEREFORE, HE PRAYED TO DELETE THE PENALTY OF RS. 4,22,278/- IMPOSED U/S 271(1)(C) OF THE ACT. 6. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. THE CO ORDINATE BENCH IN ITA NO. 716/JP/2012 AND 794 &795/JP/2011 ORDER DATE D 17/7/2015 HAS SET ASIDE THE ISSUE TO THE FILE OF THE ASSESSING OF FICER. THE FINDINGS OF THE COORDINATE BENCH IS AS UNDER:- WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD. WE FIND MERIT IN THE PROPOSAL O F BOTH ITA 418/JP/2014_ ACIT VS. M/S ALLIED GEMS CORP 4 THE PARTIES. ACCORDINGLY, WE ARE INCLINED TO SET ASI DE THE ISSUE RAISED IN REVENUES APPEAL AS WELL AS IN ASSES SEES CROSS OBJECTIONS AND RESTORE THE MATTER BACK TO THE FILE OF A.O. TO DECIDE THE SAME AFRESH AFTER THE JUDGMENT O F HONBLE RAJASTHAN HIGH COURT IN THE CASE OF ANUJ KU MAR VARSHNEY & ORTHERS VS. ITO (SUPRA) IS DELIVERED, AF TER GIVING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. IN LIGHT OF THE FACT THAT THE MATTER IN QUANTUM PRO CEEDING HAS BEEN SET ASIDE TO THE FILE OF THE ASSESSING OFFICER TO DECID E THE SAME AFRESH AFTER THE JUDGMENT OF HON'BLE RAJASTHAN HIGH COURT, THE S UBJECT PENALTY MATTER IS ALSO SET ASIDE TO THE FILE OF THE ASSESSI NG OFFICER TO DECIDE THE SAME AFRESH AFTER QUANTUM PROCEEDINGS ARE COMPLETED BY THE ASSESSING OFFICER AFTER PROVIDING REASONABLE OPPORTUNITY TO T HE ASSESSEE. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS ALLO WED FOR STATISTICAL PURPOSES ONLY. ORDER PRONOUNCED IN THE OPEN COURT ON 06/11/2015. SD/- SD/- VKJ-IH-RKSYKUH FOE FLAG ;K NO (R.P.TOLANI) (VIKRAM SINGH YAD AV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 06 TH NOVEMBER, 2015 ITA 418/JP/2014_ ACIT VS. M/S ALLIED GEMS CORP 5 * RANJAN VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- THE ACIT, CIRCLE-1, JAIPUR 2. IZR;FKHZ@ THE RESPONDENT- M/S ALLIED GEMS CORPORATION, JAIPUR. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO. 418/JP/2014) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR