M/s. Creamy Foods Ltd., Saharanpur V. DCIT, Saharanpur

ITA 4910/DEL/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 61619 (ITAT-DELHI)
• Duration Of Justice: 5 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-04-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 11-04-2012
• Assessment Year: 2008-2009
• Appeal Filed On: 04-11-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SURENDER PAL
• Assessee Lawyers: DR RAM SAMUJH

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : B : NEW DELHI BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND SHRI I.P. BANSAL, JUDICIAL MEMBER ITA NO.4910/DEL/2011 ASSESSMENT YEAR : 2008-09 CREAMY FOODS LTD., 4/654, BOMANJI ROAD, SAHARANPUR. PAN : AABCC7375A VS. DCIT, CIRCLE SAHARANPUR. (APPELLANT) (RESPONDENT) ASSESSEE BY : DR. RAM SAMUJH, ADVOCATE REVENUE BY : SHRI SURENDER PAL, SR. DR ORDER PER I.P. BANSAL, JUDICIAL MEMBER THIS IS AN APPEAL FILED BY THE ASSESSEE. IT IS DIRECTED AGAINST THE ORDER PASSED BY THE CIT (A) DATED 20 TH SEPTEMBER, 2011 FOR ASSESSMENT YEAR 2008-09. THE GROUNDS OF APPEAL READ AS UNDER:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ORDE R PASSED BY THE LEARNED CIT (APPEALS) IS PARTIALLY BAD BOTH IN THE EYE OF LAW AND ON FACTS. 2. THAT THE LD. CIT (APPEALS) IS WRONG IN LAW AS WELL AS IN FACTS IN UPHOLDING THE ORDER OF ASSESSING OFFICER OF DISALLOW ANCE OF EXPENSES OF RS.1,50,000/- AND PARTLY ALLOWING THE APP EAL. 3. THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AMEND A NY GROUND OF APPEAL. ITA NO.4910/DEL/2011 2 2. THE RETURN OF INCOME WAS FILED BY THE ASSESSEE AT `1, 33,88,682/-. AN ADDITION OF ` 2 LAC HAS BEEN MADE BY THE ASSESSING OF FICER ON THE GROUND THAT ON VERIFICATION OF DETAILS FILED BY THE ASSESSEE WITH REGARD TO EXPENSES, SOME EXPENSES COULD NOT BE VERIFIED FULLY, THE DETAILS OF WHICH IS NOT GIVEN FOR THE SAKE OF BREVITY. IN THIS M ANNER, THE ASSESSING OFFICER HAS MADE DISALLOWANCE OF ` 2 LAC. OUT OF CERTAIN EXPENSES WHICH, ACCORDING TO THE ASSESSING OFFICER, HAD I NCREASED SUBSTANTIALLY DURING THE YEAR UNDER CONSIDERATION AS CO MPARED TO EARLIER YEARS. THE ADDITION OF ` 2 LAC WAS CONTESTED IN AN APPEAL FILED BEFORE THE CIT (A). IT WAS SUBMITTED THAT GROSS PROFIT OF THE ASSESSEE HAD INCREASED FROM 8.74% TO 9.11% AND THE TURNOVER O F THE ASSESSEE HAS ALSO INCREASED FROM ` 7,53,43,583/- TO ` 104,83,54 ,065/-. IT WAS PLEADED THAT ALL THE DETAILS FOR EXPENSES WERE MAINTAI NED AND PRODUCED BEFORE THE ASSESSING OFFICER. THEREFORE, THE DISALLOWANCE IS ON AD HOC BASIS AND SHOULD BE DELETED. LEARNED CIT (A ), AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, HAS RESTRICTED TH E DISALLOWANCE TO ` 1,50,000/-. THE ASSESSEE IS AGGRIEVED, HENCE, IN APPEAL. 3. AFTER NARRATING THE FACTS, IT WAS SUBMITTED BY THE LEARNED AR THAT WITHOUT REFERRING TO ANY DEFECTS IN THE DETAILS, THE ASSESSING OFFICER HAS MADE THE ADDITION WHICH IS NOT SUSTAINABLE IN THE E YES OF LAW. HE SUBMITTED THAT LEARNED CIT (A) HAS RESTRICTED THE ADDI TION TO ` 1,50,000/- WHICH IS ALSO WITHOUT ANY BASIS. THEREFORE, HE PLEADED THAT THE ADDITION SHOULD BE DELETED IN ITS ENTIRETY. ALTE RNATIVELY, HE PLEADED THAT THE ADDITION SUSTAINED BY LEARNED CIT (A) IS EXCE SSIVE. 4. ON THE OTHER HAND, RELYING UPON THE ORDER OF ASSESSI NG OFFICER AND CIT (A), IT WAS PLEADED BY THE LEARNED DR THAT T HE ORDER OF LEARNED CIT (A) SHOULD BE UPHELD. ITA NO.4910/DEL/2011 3 5. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS IN THE LIGHT OF THE MATERIAL PLACED BEFORE US. THOUGH IT HAS BEEN WRI TTEN BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER THAT THE EXPENSES C OULD NOT BE VERIFIED FULLY, BUT, HE HAS NOT GIVEN ANY DETAILS OF THE SAME AND THE REASON FOR NOT GIVING SUCH DETAILS HAS BEEN STATED TO BE BREVITY. IN OUR OPINION, SUCH REASON IS NOT SUSTAINABLE IN THE EYES OF LA W AS THE AD HOC DISALLOWANCE, IN THE CASE WHERE THE DETAILS HAVE BEEN FURNISHED BY THE ASSESSEE, IS NOT PERMISSIBLE. LEARNED CIT (A) ALSO HAS NOT DELIBERATED ON THIS ISSUE THAT WHAT WAS THE DISCREPANCY IN THE EXPEN SES THE DETAILS OF WHICH WERE SUBMITTED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER. IN THIS VIEW OF THE SITUATION, WE ARE OF THE OPINION THAT THE DISALLOWANCE HAS BEEN MADE MERELY ON AD HOC BASIS WITHOUT REFERRING TO ANY MATERIAL. THEREFORE, WE DELETE THE DISALLOWANCE AND THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. 6. IN THE RESULT, THE APPEAL IS ALLOWED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 17.04.20 12. SD/- SD/- [G.D. AGRAWAL] [I.P. BANSAL] VICE PRESIDENT JUDICIAL MEMBER DATED, 17.04.2012. DK COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT DEPUTY REGISTRAR, ITAT, DELHI BENCHES