M/s New Dubai Jewellers, Ludhiana V. CIT-III, Ludhiana

ITA 446/CHANDI/2010

• Counselvise Citation: 44621514 RSA 2010
• Duration Of Justice: 1 year(s) 8 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-01-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 09-01-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 03-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Section: 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH B CHANDIGARH BEFORE SHRI H.L.KARWA, VICE PRESIDENT AND SHRI MEHAR SINGH, ACCOUNTANT MEMBER ITA NO. 446/CHD/2010 ASSESSMENT YEAR: 2005-06 M/S NEW DUBAI JEWELLERS, V CIT-III, SHOP NO. 2A & B, MALL PLAZA, LUDHIANA. MALL ROAD, LUDHIANA. PAN: AADFN-0661P (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ASHWANI KUMAR RESPONDENT BY : SHRI S.K.MITTAL DATE OF HEARING : 09.01.2012 DATE OF PRONOUNCEMENT : 16.01.2012 ORDER PER MEHAR SINGH, AM THE PRESENT APPEAL FILED BY THE ASSESSEE IS DIRECTE D AGAINST THE ORDER DATED 02.03.2010 PASSED BY THE LD . CIT(A) U/S 263 OF THE INCOME-TAX ACT,1961 (IN SHORT 'THE ACT') . 2. IN THIS APPEAL, THE ASSESSEE HAS RAISED THE FOLL OWING GROUND OF APPEAL: 1. THAT ORDER PASSED U/S 263 OF THE INCOME-TAX ACT,1961 BY THE LD. COMMISSIONER OF INCOME TAX- III, LUDHIANA IS AGAINST LAW AND FACTS ON THE FILE IN AS MUCH AS HE WAS NOT JUSTIFIED TO HOLD THAT ASSESSMENT ORDER DATED 14.12.2007 PASSED BY THE ITO-VII(2), LUDHIANA IS ERRONEOUS AS WELL AS PREJUDICIAL TO THE INTEREST OF REVENUE ON THE GROUND THAT THE LD. AO DID NOT VERIFY THE CORRECTNESS OF THE QUANTITATIVE DETAILS OF STOCK GIVEN IN ANNEXURE-A TO THE TAX AUDIT REPORT. 2 3. IN THE COURSE OF PRESENT APPELLATE PROCEEDINGS, LD. 'AR' CONTENDED THAT THE ISSUE RAISED BY THE CIT, IN THE NOTICE DATED 29.10.2009 ISSUED U/S 263 OF THE ACT AND SUBMISSION S THERETO MAKES IT ABUNDANTLY CLEAR THAT THE CIT, IGNORED THE FACTUM THAT THE ASSESSEE RECEIVED BACK 24 CT. GOLD WEIGHING 27 16.11 GMS. THUS, THE CONVERSION OF 24 CT GOLD HAS TO BE WORKED OUT ONLY ON THE BASIS OF THE NET QUANTITY ISSUED FOR SUCH CONVE RSION. IF THE SUBMISSION OF THE ASSESSEE OF RECEIVING BACK 24 CT GOLD IS CONSIDERED, THERE IS NO DISCREPANCY IN THE MATTER, AS CONTENDED BY THE LD. 'AR'. THE LD. 'AR' CONTENDED THAT THERE IS NO ERROR, IN VIEW OF THIS SUBMISSION AND HENCE, DISCREPANCY POIN TED OUT BY THE CIT, IN THE SAID NOTICE U/S 263 OF THE ACT, STA NDS EXPLAINED. THEREFORE, IN THE ABSENCE OF ANY ERROR, NO PREJUDIC E CAUSED TO THE REVENUE, WITHIN THE MEANING OF SECTION 263 OF T HE ACT. 4. LD. 'DR' RELIED UPON THE ORDER OF THE LOWER AUTH ORITIES. 5. WE HAVE CAREFULLY PERUSED THE RELEVANT RECORD, R IVAL SUBMISSIONS AS ALSO THE SAID SHOW CAUSE NOTICE ISSU ED BY THE CIT U/S 263 OF THE ACT. A PERUSAL OF ISSUE RAISED BY THE CIT IN THE IMPUGNED SHOW CAUSE NOTICE DATED 29.10.2009, RE VEALS THAT THE ISSUE PERTAINS TO THE RECONCILIATION OF THE GOL D STOCK. THE CIT WORKED OUT THE DISCREPANCY ON THE FOUNDATION OF CONVERSION OF 24 CT GOLD INTO 22 CT GOLD AND TREATED SUCH DISC REPANCY, AS ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE R EVENUE, WITHIN THE MEANING OF SECTION 263 OF THE ACT. HOWE VER, IF THE SUBMISSION DATED 25.01.2010 MADE BY THE ASSESSEE BE FORE CIT, RECONCILING THE DISCREPANCY POINTED OUT BY THE CIT IS CONSIDERED, THERE APPEARS TO BE NO ERROR, IN THE MA TTER. THE ASSESSEE HAS ALSO PLACED RELIANCE ON A NUMBER OF DE CISIONS IN 3 THE SAID SUBMISSIONS, INCLUDING THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF MALABAR INDUSTRIAL CO. LTD. V CIT, 243 ITR 83 (S.C), WHEREIN IT HAS BEEN CATEGORICALLY MENTIONED THAT THE PROVISIONS OF SECTION 263 CANNOT BE INVOKE D TO CORRECT EACH AND EVERY TYPE OF MISTAKE OR ERROR COMMITTED B Y THE AO. THE ASSESSEE HAS REFERRED TO QUANTITATIVE DETAILS F URNISHED ALONGWITH RETURN OF INCOME IN THE AUDIT REPORT AND POINTED OUT THAT IF DUE CONSIDERATION IS GIVEN TO THE QUANTITY OF 24 CT GOLD RECEIVED BACK BY THE ASSESSEE WEIGHING 2716.11 GMS. , NO DISCREPANCY, AS POINTED OUT BY THE ASSESSEE WOULD S URVIVE. 6. WE HAVE CAREFULLY PERUSED THE OBSERVATIONS OF TH E CIT VIZ- A-VIZ SUBMISSIONS MADE BY THE ASSESSEE AND FOUND TH AT IF THE CONTENTION OF THE ASSESSEE IS CONSIDERED, THERE IS NO SURVIVAL FOR THE SPECIFIC DISCREPANCY, POINTED OUT BY THE CIT IN THE SAID SHOW CAUSE NOTICE. IN VIEW OF THE ABOVE LEGAL AND FACTUAL DISCUSSION AND ALSO HAVING REGARD TO THE RATIO LAID DOWN BY THE HON'BLE SUPREME COURT IN THE CASE OF MALABAR INDUST RIAL CO.LTD. V CIT (SUPRA), WE FIND MERIT, IN THE SUBMIS SION MADE BY THE ASSESSEE AND HENCE, THE ORDER PASSED BY THE CIT IS CANCELLED AND ASSESSEE SUCCEEDS IN ITS APPEAL. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH JAN.,2012. SD/- SD/- (H.L.KARWA) (MEHAR SINGH) VICE PRESIDENT ACCOUNTANT MEMBER DATED: 16 TH JAN., 2012. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR, ITAT CHANDIGARH