SUMIT KUMAR SHAH, Jaipur V. ITO, Jaipur

ITA 441/JPR/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 2018 (ITAT-JAIPUR)
• Duration Of Justice: 2 year(s) 4 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-09-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 01-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AJAI MALLIK
• Keywords: Principle of natural justice; Opportunity of cross examination
• Section: 131

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR JH HKKXPAN] YS[KK LNL; ] DS LE{K BEFORE: SHRI BHAGCHAND, ACCOUNTANT MEMBER VK;DJ VIHY LA-@ ITA NO. 502/JP/2012 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2008-09 SUMIT KUMAR SHAH, M/S KRISHNA TEXTILES, MADHU VATIKA, 5 TH CROSSING, NAHARGARH ROAD, CHANDPOLE BAZAR, JAIPUR. CUKE VS. INCOME TAX OFFICER, WARD 4(1), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AGBPS 2224 D VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT VK;DJ VIHY LA-@ ITA NO. 441/JP/2015 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2008-09 SUMIT KUMAR SHAH, M/S KRISHNA TEXTILES, MADHU VATIKA, 5 TH CROSSING, NAHARGARH ROAD, CHANDPOLE BAZAR, JAIPUR. CUKE VS. INCOME TAX OFFICER, WARD 4(1), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AGBPS 2224 D VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT VK;DJ VIHY LA-@ ITA NO. 422/JP/2015 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2008-09 INCOME TAX OFFICER, WARD 4(1), JAIPUR. CUKE VS. SUMIT KUMAR SHAH, M/S KRISHNA TEXTILES, MADHU VATIKA, 5 TH CROSSING, NAHARGARH ROAD, CHANDPOLE BAZAR, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AGBPS 2224 D VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI MANISH AGARWAL (CA) JKTLO DH VKSJ LS@ REVENUE BY : SHRI AJAI MALLIK (ADDL.CIT) ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 2 LQUOKBZ DH RKJH[K@ DATE OF HEARING : 15/09/2017 MN?KKS'K.KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 20/09/2017 VKNS'K@ ORDER PER: BHAGCHAND, A.M. ITA NO. 502/JP/2012 IS QUANTUM APPEAL OF ASSESSEE FOR THE A.Y. 2008-09 AGAINST ORDER OF LD. CIT(A)-II, JAIPUR DATED 27/03/2012 AND THE APPEAL NO. 441/JP/2015 AND 422/JP/2015 ARE CROSS AP PEALS FILED BY THE ASSESSEE AND THE REVENUE EMANATES FROM THE ORDER OF THE LD. CIT(A)-II, JAIPUR DATED 06/02/2015 PERTAINING TO THE ASSESSMEN T YEAR 2008-09 FOR PARTLY SUSTAINING/DELETING PENALTY U/S 271(1)(C) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED AS THE ACT). 2. ALL THE APPEALS WERE HEARD TOGETHER AND FOR THE SAKE OF CONVENIENCE AND BREVITY, BEING DISPOSED OFF BY THIS COMMON ORDER. 3. ITA NO. 502/JP/2012 FOR THE A.Y. 2008-09. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE I S AN INDIVIDUAL AND HE FILED RETURN OF INCOME ON 30/09/2008 DECLARI NG INCOME OF RS. 1,94,480/-. THE CASE WAS SELECTED FOR SCRUTINY UNDER CASS. THE ASSESSEE WAS DERIVING INCOME FROM BUSINESS AND PROFE SSION AND INCOME FROM OTHER SOURCES. THE ASSESSEE DO ITS BUSINESS OF BANDHEJ AND SILK SAREES IN PROPRIETORY CONCERN KRISHNA TEXTILES. THE A SSESSING OFFICER DURING ASSESSMENT PROCEEDINGS NOTICED THAT THE ASSE SSEE HAS INCURRED ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 3 DAMAGE OF STOCK OF RS. 27,50,650/-, OUT OF WHICH RS. 1,50,000/- COVERED BY SALE OF DAMAGES GOODS AND THE BALANCE AMOUNT OF RS. 26,00,650/- WAS DEBITED TO P&L ACCOUNT. THE ASSESSEE SUBMITTED TH AT THE STOCK WAS DAMAGED DUE TO RAINS WHICH WAS FURTHER DAMAGED BY THE RATS ALSO. THESE GOODS BECAME IRREPAIRABLE, THEREFORE, THE ASSE SSEE HAS TO SALE THESE DAMAGED GOODS AT HEAVY LOSS. IT WAS ALSO SUBMI TTED THAT THESE GOODS WERE NOT INSURED, THEREFORE, THE DAMAGE COULD NOT BE RECOVERED FROM INSURANCE COMPANY. THE ASSESSING OFFICER MADE T HE ADDITION TO THE INCOME OF THE ASSESSEE. THE LD. CIT(A) HAS CONFI RMED THE ACTION OF THE ASSESSING OFFICER AND NOW THE ASSESSEE IS IN APP EAL BEFORE THE ITAT BY TAKING FOLLOWING GROUNDS OF APPEAL: 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE AND IN LAW, THE LD. CIT(A) GROSSLY ERRED IN SUSTAIN ING A DISALLOWANCE OF RS. 26,00,650/- ON ACCOUNT OF LOSS DUE TO DAMAGE OF STOCK. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW, THE LD. CIT(A) GROSSLY ERRED IN SUSTAIN ING A DISALLOWANCE OF RS. 26,34,815/- U/S 40(A)(IA) OF TH E INCOME TAX ACT, 1961. 3. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND, A LTER, MODIFY, SUBSTITUTE OR DELETE ANY GROUND OR GROUNDS OF APPEAL ON OR BEFORE THE HEARING OF THE APPEAL. 4. GROUND NO. 3 OF THE APPEAL IS GENERAL IN NATURE AND DOES NOT REQUIRE ANY ADJUDICATION, THEREFORE, THE SAME IS DI SMISSED. ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 4 5. GROUND NO. 2 OF THE APPEAL WAS NOT PRESSED AT THE TIME OF HEARING, THEREFORE, THE SAME STANDS DISMISSED AS NO T PRESSED. 6. THE ONLY ISSUE REMAINS FOR CONSIDERATION IS AGAIN ST SUSTAINING THE ADDITION OF RS. 26,00650/- WHICH WAS CLAIMED ON ACCOU NT OF LOSS DUE TO STOCK DAMAGE BY RAIN. THE ASSESSEE WAS ENGAGED IN THE BUSINESS OF SAREES ON WHOLESALE BASIS MAINLY SAREES OF BANDHEJ A ND SILK. THE BOOKS OF ACCOUNTS OF THE ASSESSEE WERE SUBJECT TO AUDIT AS PER PROVISION OF SECTION 44AB OF THE ACT. THE ASSESSEE WAS MAINTAININ G REGULAR BOOKS OF ACCOUNT AND METHOD OF ACCOUNTING WAS ALSO EMPLOYED R EGULARLY ON YEAR TO YEAR BASIS. WHILE PLEADING ON THE BEHALF OF THE ASSESSEE, THE LD A.R OF THE ASSESSEE HAS SUBMITTED THAT THE ASSESSEE HAD I NCURRED A LOSS OF RS. 26,00,650/- DUE TO DAMAGE OF STOCK OF SAREES. THE A SSESSEE SENT SILK SAREES FOR DYING / PRINTING JOB WORK TO TWO JOB WORKER S NAMELY MOHAMMED SHAFI PROP. M/S. MOHAMMED SHAFI DYERS AND SHRI PRAVEEN CHIPPA PROP. M/S. AARTI ENTERPRISES IN THE MONTH OF SEPTEMBER, 2007 AND DECEMBER, 2007 RESPECTIVELY. DURING THE RELEVAN T PERIOD, THE ASSESSEES MOTHER WAS SUFFERING FROM SEVERE ILLNESS AND SUBSEQUENTLY SHE DIED. ON ACCOUNT OF PREOCCUPATION WITH THE ILLNE SS OF MOTHER OF ASSESSEE, THE ASSESSEE ASKED THE JOB WORKERS TO RET AIN THE SAREES IN THEIR POSSESSION FOR SOME TIME BUT IN THE MEAN TIME , THERE WAS UNTIMELY RAINS AND DUE TO IMPROPER CARE BY THESE JOB WORKERS, THE STOCK OF SAREES ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 5 GOT DAMAGED AT THEIR PREMISES. THE DAMAGED STOCK WAS NOT IN A POSITION TO BE REPAIRED, THEREFORE, TO COVER UP THE LOSS, THIS DAMAGED STOCK WAS SOLD FOR RS. 1.50 LACS TO SHRI RAM RATAN SINGH, KANPUR. THIS GENUINE BUSINESS LOSS WAS ALLOWABLE TO THE ASSESSEE WH ICH HAS BEEN DENIED TO ASSESSEE BY THE REVENUE AUTHORITIES ON SU RMISES AND CONJECTURES. IN SUPPORT OF DAMAGES GOODS, THE ASSE SSEE HAS SUBMITTED COPY OF CONFIRMATION AND AFFIDAVIT OF M/S. MOHAMMED SHAFI DYER, COPY OF JOB WORK BILLS OF M/S. MOHAMMED SHAFI DYER, COPY OF CONFIRMATION, AFFIDAVIT AND JOB WORK BILLS OF M/S. AARTI ENTERPRIS ES, COPY OF AFFIDAVIT OF GULZAR AHMED (TRANSPORTER) WHO TRANSPORTED THE DAMAGE D GOODS, COPY OF AFFIDAVIT OF SHEHZAD (ANOTHER PHERIWALA) WHO WAS AL SO PRESENT DURING THE SALE OF DAMAGED GOODS TO RAM RATAN SINGH, KANPU R. ASSESSEE ALSO SUBMITTED HIS ADDRESS AND IDENTITY PROOF. COPY OF S ALE BILL OF DAMAGED STOCKS IN THE NAME OF RAM RATAN SINGH, KANPUR WAS AL SO FILED. COPY OF NEWSPAPERS WHERE CLASSIFIED ADVERTISEMENT PRINTED IN KANPUR TO TRACE RAM RATAN SINGH, KANPUR THE BUYER OF DAMAGED GOODS ON VARIOUS DATES WERE ALSO FILED. THE ASSESSEE HAS ALSO FILED COPIES O F NEWS IN LOCAL NEWS PAPERS SHOWING RAINFALL IN MONTH OF SEPTEMBER & DECE MBER, 2007. THE ASSESSEE HAS ALSO FILED COPY OF REPLY GIVEN BY METE OROLOGICAL DEPARTMENT DATED 06.09.2011 MENTIONING THE PLACES WHERE THE RAI N GAUGES WERE KEPT IN JAIPUR CITY DURING RELEVANT PERIOD. COPY OF DEATH CERTIFICATE OF ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 6 ASSESSEES MOTHER AND MEDICAL CERTIFICATE, HOSPITAL IZATION CERTIFICATE ISSUED BY SANTOKBHA DURLABHJI HOSPITAL ETC. WERE ALS O FILED. AFFIDAVIT OF THE ASSESSEE NARRATING ENTIRE FACTS AND CIRCUMSTANC E WITH REGARD TO DAMAGE OF STOCK WAS FILED. THUS THE ASSESSEE WAS ABL E TO ESTABLISH BEYOND ANY DOUBT THAT THE ASSESSEES MOTHER WAS SERI OUSLY ILL DURING THE RELEVANT PERIOD AND HER HEALTH KEPT ON DETERIORATIN G AND ULTIMATELY SHE DIED. ALL THESE FACTS WERE PLACED ON THE RECORD EVEN THE NEWS REGARDING THE DEATH OF ASSESSEES MOTHER IN RAJASTHAN PATRIKA ON 15/11/2007 WAS ALSO PLACED ON RECORD. THE LD AR HAS ALSO SUBMITTED THAT DUE TO BUSYNESS OF THE ASSESSEE IN MEDICAL TREATMENT OF HI S MOTHER, THE ASSESSEE COULD NOT LIFT THE GOODS FROM THE PREMISES OF THE JOB WORKERS AND DUE TO RAINS AND IMPROPER CARE BY THE JOB WORKER S PRE AND POST RAINS, THE STOCK OF SAREES WERE DAMAGED AT THE PREMI SES OF THE JOB WORKERS. THE LD. AO HAS FAILED TO APPRECIATE THE BUSI NESS EXPEDIENCY IN DISPOSAL OF DAMAGED STOCK. WITH THE PASSAGE OF TIME IT LOST VALUE. THE ASSESSEE SOLD THE ENTIRE GOODS TO THE PHERIWALA NAME LY RAM RATAN SINGH, A RESIDENT OF KANPUR FOR RS. 1,50,000/- IN C ASH WHO OFFERED THE HIGHEST PRICE OF DAMAGED GOODS TO THE ASSESSEE. THE APPELLANT DOES NOT HAVE THE COMPLETE ADDRESS OF THE BUYER AS THE ASSES SEE HAD NO REGULAR DEALING WITH HIM AND THESE DAMAGED GOODS WERE SOLD IN CASH ON AS IS WHEREIS BASIS. IN SPITE OF IT, THE APPELLANT MADE HI S BEST POSSIBLE EFFORT ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 7 TO LOCATE THE BUYER OF DAMAGED GOODS BY MAKING ADVE RTISEMENT IN VARIOUS LOCAL NEWSPAPERS OF KANPUR ON VARIOUS DATES BUT HE COULD NOT BE LOCATED AFTER A SPAN OF MORE THAN THREE YEARS. HOWEV ER, AFFIDAVIT OF ANOTHER PHERIWALA SHEHZAD WHO WAS IN CONTACT WITH THE A PPELLANT AND WAS PRESENT AT THE TIME AND PLACE OF DISPOSAL OF DAM AGED GOODS TO THE RAM RATAN SINGH, WAS SUBMITTED WHO CONFIRMED THE SAL E OF DAMAGED STOCK BY THE APPELLANT, WHICH REMAINED UNCONTROVERTE D. SINCE, DAMAGED GOODS WERE SOLD BY THE ASSESSEE UNDER BUSINESS EXPED IENCY IN CASH, THEREFORE, AS PER GENERAL BUSINESS PRACTICE SELLING DEALER IS NOT EXPECTED TO ASK ABOUT THE DETAILED PARTICULARS SUCH AS ADDRE SS OF THE CUSTOMER MORE PARTICULARLY WHEN THE GOODS WERE NOT SOLD ON CRE DIT AND THE BUYER WAS NOT A REGULAR CUSTOMER, THUS NO ADVERSE INTERFER ENCE SHOULD BE CALLED FOR REGARDING THE NON AVAILABILITY OF PURCHA SER OF DAMAGED GOODS. FURTHER, THE LD. AO HAS RELIED UPON METEOROLOGICAL REPORT (HEREINAFTER REFERRED TO AS MET REPORT) FOR THE YEAR UNDER CON SIDERATION AND OBSERVED THAT THERE WAS NO RAINFALL IN THE MONTH OF DECEMBER, 2007 AND JANUARY, 2008 EXCEPT ON 03.12.2007 WHEN THERE WAS A M EAGER RAINFALL OF 0.6 MM AND SUCH A MEAGER AMOUNT OF RAINFALL WAS N OT SUFFICIENT TO CAUSE ANY DAMAGE TO THE STOCK WHICH WAS KEPT UNDER A TIN SHADE. IN THIS REGARD IT IS SUBMITTED THAT THE MET-REPORT CAN NOT BE MADE THE SOLE BASIS FOR DENYING THE CLAIM FOR DAMAGE OF GOODS BY IGNORING THE OTHER ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 8 EVIDENCES BECAUSE THE MET-REPORT IS MERELY AN INDIC ATOR OF THE AVERAGE RAINFALL AT A PARTICULAR PLACE IN A PARTICULAR DAY. IT IS NOT AN EXACT MEASUREMENT OF RAINFALL IN A PARTICULAR AREA (COLON Y / LOCALITY) OF A CITY. THE MET-DEPARTMENT MEASURES RAINFALL THROUGH ITS INS TRUMENT CALLED RAIN GAUGE WHICH IS PLACED AT A PARTICULAR PLACE FOR MEAS URING THE AVERAGE RAINFALL IN THAT CITY. IT IS NOT POSSIBLE TO PLACE RAIN GAUGES IN EACH AND EVERY LOCALITY / COLONY OF THE CITY FOR ARRIVING AT THE AVERAGE RAINFALL FOR THAT CITY. FOR JAIPUR DISTRICT THE RAIN GAUGES ARE PLACED AT JAIPUR AIRPORT, BASSI, CHAKSU, CHOMU, KOTPUTLI, PAOTA AND PHAGI (RTI APPLICATION & REPLY FURNISHED AT PAPER BOOK PAGE NO. 64 TO 65 ). IT IS HUMBLY SUBMITTED THAT AVERAGE RAINFALL FOR JAIPUR IS MEASURED THROUG H RAIN GAUGE AT JAIPUR AIRPORT WHEREAS THE DIAMETER OF JAIPUR CITY IS MORE THAN 30 KMS. IT NORMALLY HAPPENS THAT DIFFERENTIAL RAINS IS RECEIVE D BY DIFFERENT COLONIES / AREAS WHICH DEPENDS UPON VARIOUS FACTORS SUCH AS T HE LOCATION AND POINT OF INTERSECTION OF THE CLOUDS. IT EVEN HAPPEN S THAT SOME ARE OF JAIPUR MAY RECEIVE NO RAIN WHEREAS IN SOME OTHER ARE A OF JAIPUR THERE MAY BE HEAVY RAINS. THIS FACT IS ALSO SUPPORTED BY T HE NEWS FLASHED IN VARIOUS LOCAL NEWSPAPERS OF JAIPUR FOR THE PERIOD UN DER CONSIDERATION WHEREIN IT IS CLEARLY EVIDENT THAT ON A PARTICULAR D AY SOME PARTS OF JAIPUR RECEIVED HEAVY RAINS WHEREAS SOME PARTS RECEIVED LOW OR NO RAINS. THE RELEVANT DETAILS HAVE BEEN FURNISHED AS UNDER:- ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 9 S.NO. PARTICULARS PAPER BOOK PAGE NO. 1. DAINIKBHASKAR: 09.09.2007: PAGE NO. 3 THE NEWS FLASHED THAT IN JAIPUR CITY SOME AREAS RECEIVED HEAVY RAINFALL, SOME AREAS RECEIVED LOW RA INFALL WHEREAS THE OTHER PARTS OF JAIPUR RECEIVED NO RAINS . AS PER THE NEWS VIDYASHRAM & JLN MARG RECEIVED HEAVY RAINS WHEREAS MALVIYA NAGAR (WHICH IS NOT EVEN ONE KILOMETER AWAY FROM VIDYASHRAM & JLN MARG) RECEIVED LOW RAINFALL AND OTHER PARTS OF JAIPUR RECEIVED NO RAINS. 77 2. RAJASTHAN PATRIKA: 16.09.2007 : PAGE NO. 3 THE NEWS FLASHED THAT IN JAIPUR CITY SOME AREAS RECEIVED HEAVY RAINFALL, SOME AREAS RECEIVED LOW RA INFALL WHEREAS THE OTHER PARTS OF JAIPUR RECEIVED NO RAINS . AS PER THE NEWS JAGATPURA RECEIVED HEAVY RAINS WHEREAS OTHER AREAS RECEIVED LOW / NO RAINS. 78 3. RAJASTHAN PATRIKA : 08.09.2007 : PAGE NO. 3 SIMILAR NEWS OF DIFFERENTIAL RAINS 79 4. DAINIK BHASKAR SIMILAR NEWS OF DIFFERENTIAL RAINS 80 5. DAINIK BHASKAR SIMILAR NEWS OF DIFFERENTIAL RAINS 81 FROM THE ABOVE, IT CAN BE REASONABLY BE CONCLUDED T HAT EVEN IF THE MET- REPORT SHOWS A PARTICULAR FIGURE OF RAINFALL OR NO RAINFALL IN JAIPUR CITY ON A PARTICULAR DAY, YET THERE IS ALWAYS A POSSIBILITY THAT IN SOME AREA OF JAIPUR (MAY BE THE PREMISES OF JOB WORKER) THERE MIG HT BE A HEAVIER RAINFALL. HENCE, THE LD. AO GROSSLY ERRED IN SOLELY RELYING UPON THE MET- REPORT IN DENYING THE CLAIM OF DAMAGED STOCK THEREB Y IGNORING THE OTHER MATERIAL EVIDENCES ON RECORD DESPITE WHEN THE MET-RE PORT ALSO SHOWS RAINFALL IN THAT PERIOD. FURTHER, THE LD. AO HAS RE JECTED THESE VITAL ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 10 EVIDENCES AND CONTENTION OF THE ASSESSEE ON MERE AS SUMPTION AND PRESUMPTION BY MAKING FOLLOWING ALLEGATION:- 1. THE ASSESSEE DID NOT GET ANY INSURANCE COVER ON STOCK: THOUGH THE ASSESSEE COULD NOT TAKE THE INSURANCE C OVER, HOWEVER IN ABSENCE OF STOCK INSURANCE, GENUINE LOSS INCURRED BY THE ASSESSEE SUPPORTED BY DOCUMENTARY EVIDENCES CAN NOT BE DENIED. 2. NON AVAILABILITY OF BUYER OF DAMAGED STOCK AND S ALE BILL DOES NOT BEAR TIN NO., REGISTRATION NO. ETC.: AS SUBMITTED EARLIER, THE ASSESSEE MADE EVERY BEST POSSIBLE EFFORT TO LOCATE THE BUYER AT HIS END AND COPY OF S ALE BILL WAS ALSO SUBMITTED BY THE ASSESSEE. HOWEVER, AFTER A LA PSE OF MORE THAN 3 YEARS THE BUYER COULD NOT BE TRACED. AS REGA RDS TO DISCREPANCY NOTED IN SALE BILL IT WAS SUBMITTED BY THE ASSESSEE THAT HE ASSESSEE IS DEALING IN A COMMODITY WHICH IS NOT SUBJECT TO VAT ETC. THUS HE WAS NOT REGISTERED WITH THE SAL E TAX DEPARTMENT AND GOODS WERE ALSO SOLD TO NON REGISTER ED DEALER, THEREFORE, TIN NO. OF SELLING AS WELL AS PURCHASING DEALER WERE NOT MENTIONED ON THE INVOICE. 3. EXTRACT DATES OR CHALLANS OF SENDING THE STOCK TO JOB WORKERS WERE NOT AVAILABLE: IT WAS SUBMITTED BY THE ASSESSEE IN ASSESSMENT PRO CEEDINGS AS WELL AS APPELLATE PROCEEDINGS THAT THE ASSESSEE WAS NOT RETAINING THE CHALLANS AFTER RECEIVING THE GOODS FR OM THE JOB WORKERS. THE MERE FACT THAT EXACT DATES OF SENDING THE GOODS TO JOB WORKERS WAS NOT AVAILABLE, IT CANNOT BE PRESUME D THAT GOODS WERE NOT DAMAGED IN THE POSSESSION OF JOB WOR KERS, ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 11 MORE PARTICULARLY WHEN BOTH THE JOB WORKERS HAVE CA TEGORICALLY ADMITTED THE DAMAGE OF STOCK OF SAREES WHEN THEY WE RE IN THEIR POSSESSION. 4. CHANGE OF MONTH BY AARTI ENTERPRISES FROM JANUARY 2008 TO DECEMBER, 2007, IT MAY BE OTHER MONTH ALSO: IN THIS REGARD IT WAS SUBMITTED THAT IT CAN BE HAP PENED DUE TO SOME ERROR / CONFUSION ON THE PART OF JOB WORKER WH ICH WAS LATER RECTIFIED BY THE PARTY ITSELF, THEREFORE, THE OBSERVATION OF THE LD. AO BASED ON ASSUMPTION AND PRESUMPTION, THU S SAME DESERVES TO BE IGNORED. 5. ASSESSEE IS SO NAIVE IN HIS BUSINESS THAT NOT KE PT INFORMATION ABOUT THE SAFETY OF GOODS AT THE PREMISES OF THE JO B WORKERS: AS SUBMITTED EARLIER THAT DUE TO PROLONGED ILLNESS / HOSPITALIZATION / DEATH OF APPELLANTS MOTHER IN EX CEPTIONAL CIRCUMSTANCES, THE ASSESSEE COULD NOT ATTEND PROPER LY HIS BUSINESS, WHICH FACT THE LD. AO HAS FAILED TO APPRE CIATE. 6. THE ASSESSEE DISPATCHED THE GOODS FOR JOB WORK T O JOB WORKERS IN BULK INSTEAD OF IN SMALL QUANTITIES: IT IS A GENERAL PRACTICE IN HIGHLY COMPETITIVE MAR KET THAT QUANTITIES ARE TO BE SENT IN BULK FOR JOB WORK TO R EDUCE THE COST AND OTHER INCIDENTAL CHARGES. FURTHER ASSESSEE IS A WHOLESALER AND LOOKING TO THE DEWALI SEASON AHEAD, LARGE QUANT ITY WAS SENT IN THE MONTH OF SEPT.-07 AND LIKEWISE LOOKING TO THE MARRIAGE SEASON IN JANUARY AND FEBRUARY LARGE QUANT ITY OF SAREES WERE SENT TO THE JOB WORKERS. IT IS THE DECI SION OF A BUSINESSMAN WHICH FURTHER ALSO DEPENDS UPON BUSINES S ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 12 EXPEDIENCY PREVAILING AT THAT TIME, THUS OBSERVATIO N OF THE LD. AO ARE BASELESS DESERVES NO CREDENCE. 7. JOB WORKERS STATED THAT THE STOCK WAS KEPT UNDER TIN SHADES WHEREAS THERE WAS NO TIN SHADE AS WELL AS NOT ENOUG H SPACE TO STORE HUGE STOCK: IN THIS REGARD IT IS SUBMITTED THAT THE INSPECTION WAS DONE AFTER 3-4 YEARS OF THE EVENT WHEREAS DURING THE YEAR UNDE R APPEAL TIN SHADE AS WELL AS ENOUGH STORAGE SPACE WAS THERE AT THE PREMISES OF JOB WORKERS AND THIS FACT WAS DULY CONF IRMED BY THE RESPECTIVE JOB WORKERS IN THEIR AFFIDAVIT AND NEVER DENIED THE FACT OF DAMAGE OF GOODS. ALL THE ALLEGATIONS OF THE LD. AO WERE DULY REBUTT ED BY THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDING S AS WELL AS APPELLATE PROCEEDINGS VIDE SUBMISSION MADE 04.10 .2011 (APB 94-101) AND IT WAS FURTHER SUBMITTED THAT THE METEOROLOGICAL DEPARTMENTS REPORT OBTAINED BY THE LD. AO FROM THE METEOROLOGICAL DEPARTMENT ON 13.12.2010 CONFIRM ED RAINS IN MONTHS OF SEPTEMBER & DECEMBER, 2007, WHEN THE G OODS WERE DAMAGED AT THE JOB WORKERS PREMISES BUT, THE L D. AO CONCLUDED NO RAINS AND MADE THE DISALLOWANCE. HAVIN G RAINS DURING THIS PERIOD IS FURTHER CONFIRMED BY NEWS IN LOCAL NEWSPAPERS OF VARIOUS DATES SHOWING PHOTOGRAPHS AND NEWS OF RAINS IN SEPTEMBER-DECEMBER, 2007 (66-76). IN CASE OF M/S. MOHAMMED SHAFI DYERS, HEAVY RAINS WERE SHOWN IN METEOROLOGICAL REPORT TILL 16/09/2007 WHEREAS THE L D. AO ALLEGED THAT THE JOB WORK WAS NOT FINISHED BEFORE24 /09/2007 WHEN THERE WERE NO RAINS. ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 13 IT IS FURTHER SUBMITTED THAT DURING THE APPELLATE PROCEEDINGS ON THE DIRECTION OF THE LD. CIT(A) THE LD. AO SUBMITTE D REMAND REPORT DATED 20.03.2012 (APB 107-110). IN REMAND PROCEEDINGS, LD. AO RECORDED THE STATEMENTS OF SHRI PRAVEEN CHIPI PROP. OF M/S AARTI ENTERPRISES (APB 123-155) A ND SHRI GULZAR AHMED TRANSPORTER ON 19.03.2012 (APB 115- 11 2). ALL THE ALLEGATIONS / OBSERVATION MADE BY THE LD. AO IN REMAND REPORT WERE REBUTTED BY THE ASSESSEE BEFORE THE LD. CIT (A) VIDE SUBMISSION MADE ON 26.03.2012 (APB 137-141). H OWEVER, THE LD. CIT (A) HAS REJECTED THE CONTENTION OF THE ASSESSEE AND SUSTAINED THE ADDITION BY MAKING FOLLOWING OBSERVAT IONS:- 1. THE APPELLANT AND PROPRIETOR OF M/S. MOHAMMAD S HAFI DYERS HAVE DELIBERATELY AVOIDED COMPLIANCE BEFORE THE LD. AO AND SON OF SH. MOHAMMED SHAFI DID NOT DELIBERATELY GIVE THE COMPLETE ADDRESS OF THEIR FACTORY. 2. THE LD. AO HAS EXPOSED THE CONTRADICTION IN THE STATEMENT OF SHRI GULZAR AHMED, TEMPO DRIVER AND SHRI PRAVEEN CH IPPI PROPRIETOR OF M/S. AARTI ENTERPRISES. 3. SHRI PRAVEEN CHIPPI, PROPRIETOR OF M/S. AARTI ENT ERPRISES HAS CATEGORICALLY ADMITTED BEFORE THE LD. AO THAT STOCK SENT TO HIM FOR PROCESSING WAS NOT DAMAGED. 4. SHRI PRAVEEN CHIPPI HAD REPLIED AFTER VERIFYING HIS RECORDS / BILL BOOK AND NOT OUT OF HIS MEMORY AND OPPORTUNITY TO A LLOW CROSS EXAMINATION TO SHRI PRAVEEN CHIPPI WOULD NOT MAKE C LAIM OF THE ASSESSEE AS GENUINE. ALL THE AFORESAID OBSERVATIONS OF THE LD. CIT (A) D O NOT FIND FORCE IN VIEW OF FOLLOWING FACTS:- ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 14 1. DURING THE COURSE OF REMAND PROCEEDINGS THE SUM MONS U/S 131 WERE ISSUED REQUIRING PERSONAL PRESENCE OF THE PERSONS ON THE VERY IMMEDIATE NEXT WORKING DAY AND SOME REASON ABLE TIME MUST BE GIVEN FOR PERSONAL PRESENCE AS THE PERSON M IGHT BE PREOCCUPIED IN SOME URGENT PERSONAL OR BUSINESS WOR K. MOHAMMAD SHAFI COULD NOT PERSONALLY ATTEND THE PROC EEDINGS AS HE WAS OUT OF JAIPUR TO SAWAI MADHOPUR AND SUMMO N WAS SERVED ON HIS RELATIVES IN RESPONSE TO WHICH HIS SO N RAYEES ATTENDED THE PROCEEDING AND SOUGHT ADJOURNMENT. HE HAS GIVEN AFFIDAVIT AND SUBMITTED A LETTER THROUGH SPEED POST REQUESTING THE LD. AO TO GIVE ANOTHER DATE (APB 142-143). HOWE VER, THE LD. AO HAS NOT ALLOWED FURTHER OPPORTUNITY AND WRON GLY MENTIONED IN THE REMAND REPORT THAT SUMMON REMAINED UNCOMPLIED WITH. 2. AS REGARD TO THE OBSERVATION OF LD. C1T (A) THAT THE SON OF THE MOHAMMED SHAFI DYERS DID NOT GIVE ADDRESS OF THEIR FACTORY, IT IS SUBMITTED THAT HIS FATHER AT THAT TIME WAS OUT O F TOWN, AND IT IS A COMMON FACT THAT A ORDINARY MAN IS TRY TO AVOI D TO GIVE DETAILS BEFORE THE INCOME TAX AUTHORITY THUS IN THE ABSENCE OF HIS FATHER, HE DID NOT GIVE THE ADDRESS OF THEIR FA CTORY, HOWEVER ATTENDED THE PROCEEDINGS AND SOUGHT THE ADJOURNMENT THUS OBSERVATION OF THE LD. CIT (A) DESERVES TO BE IGNOR ED. FURTHER IN CASE OF THE ASSESSEE, IT IS SUBMITTED T HAT THE ASSESSEE WAS AT DELHI DUE TO SOME IMPORTANT PREOCCU PIED WORK AND SOUGHT THE ADJOURNMENT THOUGH SPEED POST (APB 1 36) BUT THE LD. AO ALLEGED THAT THE ASSESSEE WILLFULLY OPTE D NOT TO ATTEND THE PROCEEDINGS WITHOUT ANY BASIS. IT IS, TH EREFORE, SUBMITTED THAT NO PROPER OPPORTUNITY WAS PROVIDED B Y THE LD. AO IN THE REMAND PROCEEDINGS AND DRAWN ADVERSE INFE RENCE AS ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 15 PER HIS OWN SWEET WILL THUS OBSERVATION OF THE LD. CIT (A) DESERVES TO BE IGNORED AND EXCLUDED. 3. THE LD. AO MENTIONED IN THE REMAND REPORT THAT T HERE WAS CONTRADICTION IN THE STATEMENT OF GULZAR AHMED AND PRAVEEN CHIPPI IN RESPECT OF THE PLACE FROM WHERE SAREES WE RE LIFTED BY PRAVEEN CHIPPI FOR PRINTING. IT IS HUMBLY SUBMITTED THAT THERE MAY BE MINOR CONTRADICTION FOR THE REASON THAT THE STATEMENT WERE BASED ON HUMAN MEMORY WHICH HAS ITS OWN LIMITA TION AND THE MATTER UNDER CONSIDERATION IS FOUR TO FIVE YEAR S OLD WHEN ENQUIRIES WERE MADE FROM BOTH OF THEM. HOWEVER, THE PLACE OF LIFTING OF SAREES FOR PRINTING JOB WORK IS NOT AT A LL RELEVANT FOR THE ISSUE UNDER CONSIDERATION. THE ASSESSEE TAKES SERVI CES OF VARIOUS TEMPOWALAS FOR TRANSPORTATION OF GOODS AND IS NOT SOLELY DEPENDENT ON GULZAR AHMED. HENCE, THE NUMBER OF TRI PS MADE BY GULZAR AHMED, PER DAY TRIP, CAPACITY OF THE TEMP O ETC. ARE NOT RELEVANT AT ALL IN RESPECT OF THE ISSUE UNDER C ONSIDERATION. 4. AS REGARDS TO STATEMENT RECORDED IN CASE OF SHRI PRAVEEN CHIPPI IT IS SUBMITTED THAT STATEMENT WERE RECORDED ON OAT H BY THE LD. AO AND HOWEVER ONLY FIRST THREE PAGES WERE SIGNED B Y HER AND ON LAST PAGE, SIGNATURES OF THE LD. AO IS NOT THERE AND SIGNATURE OF ONE LACHI SINGH APPEARS AT THE END PAGE (APB 1 35) WHO IS NEITHER THE PERSON WHO IS RECORDING THE STATEMENT O N OATH NOR THE PERSON WHOSE STATEMENT ARE RECORDED. IN CASE OF RECORDING OF STATEMENT ON OATH THE SIGNATURE OF BOTH THE PART IES ARE REQUIRED. HENCE THE STATEMENT RECORDED ARE DOUBTFUL , BAD IN LAW AND CANNOT BE RELIED UPON. ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 16 5. IN REPLY TO QUESTION 30 (APB 129) SHRI PRAVEEN C HIPPI ALSO ACCEPTED THE FACT THAT STOCK OF SAREES WERE DAMAGED DUE TO RAIN. 6. FOR PACKING OF SAREES IN JUTE BAGS, IT IS SUBMIT TED THAT PRAVEEN CHIPPI CATEGORICALLY SAID IN REPLY TO QUESTION NO. 47 (APB 133) THAT HE HAD NOT USED ANY PACKING MATERIAL FOR SAREE S. HENCE, IT CAN BE INFERRED THAT SAREES WERE NOT PACKED IN JUTE BAGS. 7. THE LD. AO HAD MENTIONED IN THE REMAND REPORT TH AT SAREES WERE WASHABLE WITH NORMAL WATER WHEREAS PRAVEEN KUM AR CHIPPI HAS NO WERE STATED THAT THE SAREES WERE WASH ABLE. 8. FOR VARIATION IN THE MONTH OF DELIVERY OF GOODS, IT IS SUBMITTED THAT THE EVENT OCCURRED FOUR TO FIVE YEARS AGO AND HUMAN MEMORY IS LIMITED. SHRI PRAVEEN CHIPPI WAS UNDER EX TREME MENTAL PRESSURE WHEN STATEMENTS WERE RECORDED AS HE STATED IN REPLY TO Q.NO. 32 (APB 129-130) THAT HE RECEIVED GO ODS IN THE MONTH OF MAY, 2007, AND THE RETURNED THEM IN MARCH, 2008, WHEREAS THE GOODS WERE LYING WITH HIM FOR THREE MON THS. THESE THREE THINGS CANNOT HAPPEN SIMULTANEOUSLY. HE DOES NOT REMEMBER ALL THINGS AND WAS UNDER MENTAL PRESSURE A ND SUCH MINOR AND IRRELEVANT VARIATIONS COULD NOT BE MADE B ASIS TO MADE SUCH A HUGE DISALLOWANCE. IT IS FURTHER SUBMITTED THAT THE LD. CIT (A) HAS SUS TAINED THE ADDITION MERELY ON THE BASIS OF STATEMENT OF PRAVEEN CHIPPI RECORDED IN THE REMAND PROCEEDINGS, HOWEVER THE ERROR AND OMISSIONS IN HIS STATEMENTS HAS ALREADY BEEN EXPLAINED ABOVE. FURTHER, PRAVEEN CHIPPI IN HIS ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 17 AFFIDAVIT ACCEPTED THAT GOODS WERE DAMAGED AT HIS PR EMISES DUE TO RAIN. IN THIS REGARD RELIANCE IS PLACED ON FOLLOWING CASE LAWS:- RIGHT TO CROSS-EXAMINATION KIND ATTENTION OF YOUR HONOUR IS INVITED TO THE JUD GMENT OF HONBLE SUPREME COURT IN THE CASE OF CCE VS. ANDAMAN TIMBER INDUSTRIES REPORTED IN 2015 ( 324) ELT 641 WHEREIN IT 6 ACCORDING TO US, NOT ALLOWING THE ASSESSEE TO C ROSS-EXAMINE THE WITNESSES BY THE ADJUDICATING AUTHORITY THOUGH THE STATEMENTS OF THO SE WITNESSES WERE MADE THE BASIS OF THE IMPUGNED ORDER IS A SERIOUS FLAW WHICH MAKES THE ORDER NULLITY INASMUCH AS IT AMOUNTED TO VIOLATION OF PRINCIPLES OF NATURAL JUSTICE BECAUSE OF WHICH THE ASSESSEE WAS ADVERSELY AFFECTED. IT IS TO BE BORNE IN MIND THAT THE ORDER OF THE COMMISSIONER WAS BASED UPON THE STATEM ENTS GIVEN BY THE AFORESAID TWO WITNESSES. EVEN WHEN THE ASSESSEE DIS VUTED THE CORRECTNESS OF THE STATEMENTS AND WANTED TO CROSS-EXAMINE, THE ADJUDIC ATING AUTHORITY DID NOT GRANT THIS OPPORTUNITY TO THE ASSESSEE. IT WOULD BE PERTINENT TO NOTE THAT IN THE IMPUGNED ORDER PASSED BY THE ADJUDICATING AUTHORITY HE HAS SPECIFICALLY MENTIONED THAT SUCH AN OPPORTUNITY WAS SOUGHT BY TH E ASSESSEE. HOWEVER, NO SUCH OPPORTUNITY WAS GRANTED AND THE AFORESAID P LEA IS NOT EVEN DEALT WITH BY THE ADJUDICATING AUTHORITY. AS FAR AS THE T RIBUNAL IS CONCERNED, WE FIND THAT REJECTION OF THIS PLEA IS TOTALLY UNTENAB LE. THE TRIBUNAL HAS SIMPLY STATED THAT CROSS-EXAMINATION OF THE SAID DEALERS C OULD NOT HAVE BROUGHT OUT ANY MATERIAL WHICH WOULD NOT BE IN POSSESSION OF TH E APPELLANT THEMSELVES TO EXPLAIN AS TO WHY THEIR EX-FACTORY PRICES REMAIN STATIC. IT WAS NOT FOR THE TRIBUNAL TO HAVE GUESS WORK AS TO FOR WHAT PURPOSES THE APPELLANT WANTED TO CROSS-EXAMINE THOSE DEALERS AND WHAT EXTRACTION THE APPELLANT WANTED FROM THEM. 7. AS MENTIONED ABOVE, THE APPELLANT HAD CONTESTED THE TRUTHFULNESS OF THE STATEMENTS OF THESE TWO WITNESSES AND WANTED TO DIS CREDIT THEIR TESTIMONY FOR WHICH PURPOSE IT WANTED TO AVAIL THE OPPORTUNIT Y OF CROSS-EXAMINATION. THAT APART, THE ADJUDICATING AUTHORITY SIMPLY RELIE D UPON THE PRICE LIST AS MAINTAINED AT THE DEPOT TO DETERMINE THE PRICE FOR THE PURPOSE OF LEVY OF EXCISE DUTY. WHETHER THE GOODS WERE, IN FACT, SOLD TO THE SAID DEALERS/WITNESSES AT THE PRICE WHICH IS MENTIONED I N THE PRICE LIST ITSELF COULD BE THE SUBJECT MATTER OF CROSS-EXAMINATION. THEREFO RE, IT WAS NOT FOR THE ADJUDICATING AUTHORITY TO PRESUPPOSE AS TO WHAT COU LD BE THE SUBJECT MATTER OF THE CROSS-EXAMINATION AND MAKE THE REMARKS AS ME NTIONED ABOVE. ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 18 FURTHER, RELIANCE IS PLACED ON THE JUDGMENT OF HON BLE ALLAHABAD HIGH COURT IN THE CASE OF CCE VS. SHYAM TRADERS REPORTED IN 2016 (333) ELT 389 WHEREIN, THE ABOVE MENTIONED JUDGMENT OF SUPREM E COURT IN ANDAMAN TIMBER INDUSTRIES WAS FOLLOWED AND THE REQUIRE MENT OF ALLOWING CROSS-EXAMINATION OF WITNESSES WAS HELD AS IN DISPENSIBLE FOR ADJUDICATION. 39 TW 21 4 CIT VS. BHANWAR LAI MURWATIYA (RAJ. HIGH COURT, JODHPUR) WHETHER ADDITION CAN BE MADE ON THE BASIS OF STATEM ENTS IN A CASE WHEREIN NO OPPORTUNITY OF CROSS EXAMINATION WAS ALLOWED TO THE ASSESSEE ? - HELD NO. LAXMANBHAI S. PATEL VS. CIT [ITR NO. 41 OF 1997, DA TED 22-07-2008] (GUJ.) THE LEGAL EFFECT OF THE STATEMENT RECORDED BEHIND T HE BACK OF THE ASSESSEE AND WITHOUT FURNISHING THE COPY THEREOF TO THE ASSE SSEE OR WITHOUT GIVING AN OPPORTUNITY OF CROSS- EXAMINATION, IF THE ADDITION IS MADE, THE SAME IS REQUIRED TO BE DELETED ON THE GROUND OF VIOLATION O F THE PRINCIPLES OF NATURAL JUSTICE. IT IS THUS HUMBLY SUBMITTED THAT THE METEOROLOGICAL REPORT COULD NOT BE SOLELY MADE BASIS FOR DENYING THE LEGAL CLAIM OF DA MAGE OF GOODS AS RELIED BY THE LD. AO BY IGNORING THE OTHER EVIDENCE BECAUSE THE METEOROLOGICAL REPORT WAS MERELY AND INDICATOR OF AV ERAGE RAIN FALL AT A PARTICULAR PLACE / CITY IN A PARTICULAR DAY AND NOT A EXACT MEASURE OF RAINFALL IN A PART OF A CITY, THEREFORE, ADDITION M ADE BY THE LD. AO BASED ON ASSUMPTION AND PRESUMPTION AND FURTHER BASED ON WRONG APPRECIATION OF FACTS DESERVES TO BE DELETED AND TH E LOSS OF STOCK CLAIMED BY THE ASSESSEE DESERVES TO BE ALLOWED MORE PARTICULARLY WHEN THE ASSESSEE HAS SUBMITTED EVERY PLAUSIBLE EVIDENCE TO SUPPORT HIS ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 19 CLAIM AND LOSS SUFFERED BY THE ASSESSEE IS GENUINE LOOKING TO THE FACTS AND CIRCUMSTANCE OF CASE. 7. ON THE OTHER HAND, THE LD SR. DR HAS RELIED ON T HE ORDERS OF THE AUTHORITIES BELOW. 8. I HAVE HEARD BOTH THE SIDES ON THIS ISSUE. I HAV E ALSO CONSIDERED THE VARIOUS DECISIONS RELIED UPON BY BOTH THE SIDES . THE ASSESSEE IS DEALING IN BUSINESS OF BANDHEJ AND SILK SAREES AND THE ASSESSEE WAS REGULARLY SENDING HIS SAREES FOR DYING AND PRINTING JOB WORK. THIS WAS A REGULAR FEATURE OF THE ASSESSEES BUSINESS. THE ASSE SSEE CLAIMED THE LOSS ON ACCOUNT OF DAMAGE OF STOCK OF SAREES DUE TO RAIN, WHICH WAS DENIED BY THE REVENUE. THE ASSESSEE IN SUPPORT OF CL AIM OF DAMAGE OF GOODS HAS SUBMITTED CONFIRMATION AND AFFIDAVITS FRO M BOTH THE JOB WORKERS NAMELY MOHAMMED SHAFI PROP. M/S. MOHAMMED SH AFI DYERS AND SHRI PRAVEEN CHIPPA PROP. M/S. AARTI ENTERPRISE S. COPIES OF BILLS RAISED BY THESE JOB WORKERS WERE ALSO SUBMITTED. THE A FFIDAVIT OF TRANSPORTER SHRI GULZAR AHMED, WHO TRANSPORTED THE D AMAGED GOODS WERE ALSO SUBMITTED. AN AFFIDAVIT OF WITNESS NAMELY S HRI SHEHZAD, WHO WAS PRESENT DURING THE SALE OF DAMAGED GOODS TO SHRI RAM RATAN SINGH OF KANPUR WAS FILED. THE IDENTITY PROOF WITH ADDRESS OF SHEHZAD WAS ALSO FILED, WHICH IS PLACED AT PAGE NO. 46 AND 47 OF THE PAPER BOOK. THE ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 20 COPY OF SALE BILL PLACED AT PAGE NO. 48 OF THE PAPE R BOOK WAS ALSO SUBMITTED. COPY OF DAINIK JAGRAN NEWSPAPER DATED 08 /09/2011 PLACED AT PAGE NO. 49 OF THE PAPER BOOK AND COPY OF THE NE CESSARY INFORMATION PUBLISHED IN KHOJI NARAD ON 08/09/2011 IS ALSO PACE D AT PAGE NO. 50 OF THE PAPER BOOK WHEREIN THE ASSESSEE HAS GIVEN AN AD VERTISEMENT TO THE PUBLIC TO GIVE INFORMATION REGARDING SHRI RAM RATAN SINGH OF KANPUR TO WHOM THE ASSESSEE HAS SOLD THESE GOODS. SIMILARLY SU CH CLASSIFIED ADVERTISEMENT WERE ALSO GIVEN IN THE NEWSPAPER NAME LY RASHTRIYA SAHARA ON 10/09/2011 TO 12/09/2011, WHICH ARE PLAC ED AT PAGE NO. 53 TO 55 OF THE PAPER BOOK. THUS THE ASSESSEE HAS MADE NECESSARY EFFORTS TO LOCATE SHRI RAM RATAN SINGH OF KANPUR TO WHOM THE GOODS WERE SOLD TO ESTABLISH HIS CLAIM. THE ASSESSEE HAS ALSO SUBMIT TED COPIES OF NEWS PAPERS WHICH HAS REPORTED REGARDING RAINFALL IN THE MONTH OF SEPTEMBER AND DECEMBER, 2007 IN JAIPUR. THE ASSESSEE HAS ALSO SUBMITTED NECESSARY EVIDENCES LIKE COPY OF DEATH CERTIFICATE OF ASSESSEES MOTHER AND MEDICAL CERTIFICATE FOR HER HOSPITALIZATION ISS UED BY SANTOKBHA DURLABHJI HOSPITAL TO ESTABLISH THAT DURING THE REL EVANT PERIOD, THE ASSESSEE WAS BUSY IN MEDICAL TREATMENT OF HIS MOTHER AND DUE TO WHICH HE COULD NOT LIFT THE GOODS FROM THE PREMISES OF TH E JOB WORKERS. ALL THESE FACTS AND CIRCUMSTANCES SUGGEST THAT THE ASSE SSEE HAS SUFFERED GENUINE LOSS ON ACCOUNT OF RAIN BY DAMAGING STOCK O F SAREES. HE HAD ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 21 SUBMITTED SUFFICIENT EVIDENCES TO ESTABLISH THE BUS INESS LOSS OCCURRED ON ACCOUNT OF RAIN AT THE PREMISES OF THE JOB WORKERS. THEREFORE, THE DISALLOWANCE OF THE LOSS SUFFERED BY THE ASSESSEE WAS NOT JUSTIFIED. ACCORDINGLY, ADDITION OF RS. 26,00,650/- IS DELETED . 9. ASSESSEES APPEAL IN ITA NO. 441/JP/2015 AND REV ENUES APPEAL IN ITA NO. 422/JP/2015 ARE WITH REGARD TO PARTLY SUSTAI NING/DELETING PENALTY U/S 271(1)(C) OF THE ACT. THESE ARE THE CROSS APPEALS WITH REGARD TO PARTLY DELETING/SUSTAINING THE PENALTY LEVIED U/S 271(1)(C ) OF THE ACT. SINCE THE ASSESSEES APPEAL IN QUANTUM, ADDITION HAS BEEN ALL OWED, THEREFORE, THE APPEAL OF THE ASSESSEE IS ALLOWED AND THE APPEAL OF THE REVENUE STAND DISMISSED. 10. IN THE RESULT, ITA NO. 502/JP/2012 AND 441/JP/2 015 ARE ALLOWED AND ITA NO. 422/JP/2015 IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 20/09/2017. SD/- HKKXPAN (BHAGCHAND) YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 20 TH SEPTEMBER, 2017 *RANJAN ITA 502/JP/2012, 441 & 422/JP/2015_ SUMIT KUMAR SHAH VS. ITO 22 VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANTS- SHRI SUMIT KUMAR SHAH, JAIPUR. 2. IZR;FKHZ @ THE RESPONDENT- THE ITO, WARD 4(1), JAIPUR. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 502/JP/2011, 441 & 422/JP/2015) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR