The ACIT, Circle-1, Ahmedabad V. AVI Polymers Limited, Dist.Ahmedabad

ITA 444/AHD/2005

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 9893 (ITAT-AHMEDABAD)
• Duration Of Justice: 11 year(s) 9 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-11-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 18-10-2016
• Assessment Year: 2001-2002
• Appeal Filed On: 11-02-2005
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHIVA SEWAK
• Assessee Lawyers: M K PATEL
• Keywords: Unexplained investment
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH AHMEDABAD BEFORE SHRI N. K. BILLAIYA, ACCOUNTANT MEMBER, AND SHRI S. S. GODARA, JUDICIAL MEMBER. ITA NO. 444/AHD/2005 (ASSESSMENT YEAR: 2001-02) A.C.I.T., CIRCLE 1, AHMEDABAD APPELLANT VS. AVI POLYMERS LIMITED, NR. SONAL INDL. ESTATE, AT: KHODA, TA: SANAND, DIST: AHMEDABAD RESPONDENT PAN: AABCA2577L / BY REVENUE : SHRI SHIVA SEWAK, SR. D.R. /BY ASSESSEE : SHRI M. K. PATEL, A.R. /DATE OF HEARING : 18.10.2016 /DATE OF PRONOUNCEMENT : 25.11.2016 ORDER PER S. S. GODARA, JUDICIAL MEMBER THIS REVENUES APPEAL FOR ASSESSMENT YEAR 2001-02 A RISES AGAINST THE CIT(A)- V, AHMEDABADS ORDER DATED 05.11.2004, IN A PPEAL NO. CIT(A)- V/WD.1(1)/127/2004-05, IN PROCEEDINGS UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. ITA NO.444/AHD/2005 (ACIT VS. AVI POLYMERS LTD.) A.Y. 2001-02 - 2 - 2. THE REVENUE RAISES FOLLOWING SUBSTANTIVE GROUNDS IN THE INSTANT APPEAL: 1. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITIONS MADE ON ACCOUNT OF UNEXPLAINED INVESTMENT OF RS.3,0 9,27,000/-. 2. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS OF THE CASE IN DELETING THE ADDITIONS MADE ON ACCOUNT OF GROSS PROFIT OF RS.55, 04,400/-. 3. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITIONS MADE ON ACCOUNT OF ADEQUATE YIELD OF PRODUCTION OF RS.1,24,24,855/-. 3. A PERUSAL OF THE INSTANT CASE FILE INDICATES THA T ALL THE ABOVE THREE SUBSTANTIVE GROUNDS SEEK TO RESTORE THE ABOVE UNEXP LAINED INVESTMENT ADDITION OF RS.3,09,27,000/- ARISING FROM DIFFERENC E IN ASSESSEES STOCK STATEMENT RECORDED IN ITS BOOKS AND THAT SUBMITTED TO THE CREDITOR BANK FOR AVAILING HYPOTHECATION FACILITY FOLLOWED BY ESTIMAT ED GROSS PROFITS AND YIELD OF PRODUCTION THERE UPON AS FORMING SUBJECT MATTER OF THE LATTER TWO SUBSTANTIVE GROUNDS. THE ASSESSING OFFICER HAD MAD E ALL THESE ADDITIONS IN THE IMPUGNED RE-ASSESSMENT FRAMED ON 31.03.2004. 4. WE PROCEED FURTHER TO NOTICE THAT THE CIT(A) REV ERSES ASSESSING OFFICERS ACTION ON THE GROUND THAT HE HAS NOT BROU GHT ON RECORD ANY MATERIAL APART FROM ASSESSEES STOCK STATEMENTS SUBMITTED TO THE BANKS IN QUESTION. HE FURTHER FOLLOWS HIS ORDER IN ASSESSEES CASE ITS ELF FOR IMMEDIATE PRECEDING ASSESSMENT YEAR TO DECIDE THE MAIN ISSUE AGAINST TH E DEPARTMENT. 5. BOTH THE LEARNED REPRESENTATIVES STATE VERY FAIR LY AT THE OUTSET THAT THIS TRIBUNAL DECIDED REVENUES APPEAL ITA NO.4317/AHD/2 003 ON 28.02.2006 IN THE IMMEDIATE PRECEDING ASSESSMENT YEAR INVOLVING I DENTICAL ISSUE OF UNEXPLAINED INVESTMENTS ADDITION EMANATING FROM DIF FERENCE IN ASSESSEES BOOKS AND STOCK STATEMENT GIVEN TO CREDITORS BANK. THEY SUBMIT THAT THE ABOVE CO-ORDINATE BENCH REVERSED CIT(A)S FINDINGS THEREIN DELETING THE SAID ITA NO.444/AHD/2005 (ACIT VS. AVI POLYMERS LTD.) A.Y. 2001-02 - 3 - ADDITION. THE ASSESSEE FILED TAX APPEAL NO.1182/20 07. HONBLE JURISDICTIONAL HIGH COURT APPEARS TO HAVE REVERSED THIS TRIBUNALS ORDER ABOVE SAID IN ITS JUDGMENT DATED 14.07.2016 AND RESTORED THE CIT(A)S FINDINGS ON THE GROUND THAT THE IMPUGNED STOCK STATEMENT FURNIS HED TO CREDITOR BANKS WAS NOT BASED UPON ANY PHYSICAL VERIFICATION OF THE REC ORDED ITEMS. LD. DEPARTMENTAL REPRESENTATIVE FAILS TO DISPUTE ALL TH ESE DEVELOPMENTS POST FACTO FILING OF THE INSTANT APPEAL. WE ACCORDINGLY FOLLOW HONBLE JURISDICTIONAL HIGH COURTS JUDGMENT HEREINABOVE TO APPROVE THE LOWER APPELLATE FINDINGS UNDER CHALLENGE ON ALL THREE ISS UES. 6. THIS REVENUES APPEAL IS DISMISSED. [PRONOUNCED IN THE OPEN COURT ON THIS THE 25 TH DAY OF NOVEMBER, 2016.] SD/- SD/- (N. K. BILLAIYA) (S. S. GODARA) ACCOUNTANT MEMBER JUDICIAL ME MBER AHMEDABAD: DATED 25/11/2016 TRUE COPY S.K.SINHA / COPY OF ORDER FORWARDED TO:- / REVENUE 2 / ASSESSEE ! / CONCERNED CIT 4 !- / CIT (A) ()*+ ,--. ./0 / DR, ITAT, AHMEDABAD 1+2345 / GUARD FILE. BY ORDER / . // ./0