ITO, CHITTORGARH V. Shri Krishna Kumar Ojha, CHITTORGARH

ITA 498/JODH/2010

• Counselvise Citation: 49823314 RSA 2010
• Duration Of Justice: 1 year(s) 2 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-12-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2003-2004
• Appeal Filed On: 22-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G R KOKANI
• Keywords: Loose papers
• Section: 133A

Judgement Text

1 ITA 498-10 IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH JODHPUR. ( BEFORE SHRI R.K. GUPTA AND SHRI N.L. KALRA ) ITA NO. 498/JODH/2010 ASSTT. YEAR : 2003-04. THE INCOME-TAX OFFICER, VS. SHRI KRISHNA KUMAR OJ HA, PROP. WARD-2, CHITTORGARH. M/S. K.K. MARBLES, OLD IND USTRIAL AREA, CHITTORGARH. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI G.R. KOKANI RESPONDENT BY : SHRI SANDEEP JHANWAR DATE OF HEARING : 15.12.2011. DATE OF PRONOUNCEMENT : 16.12.2011. ORDER DATED : 16/12/2011. PER R.K. GUPTA, J.M. THIS IS AN APPEAL DEPARTMENT AGAINST THE ORDER OF LD. CIT (A) RELATING TO ASSESSMENT YEAR 2003-04. 2. THE DEPARTMENT IS OBJECTING IN DELETING VARIOUS DISALLOWANCES BY LD. CIT (A) I.E. RS. 21,700/- OUT OF SPARE PARTS EXPENSES, RS. 2,68, 320/- OUT OF SEGMENT EXPENSES, RS. 4,50,000/- OUT OF MINING EXPENSES AND RS. 27,447/- OUT OF EXCESS AND SHORTAGE OF STOCK. 3. NOW THE APPEAL OF THE DEPARTMENT GROUND-WISE IS BEING DISPOSED OFF IN THE FOLLOWING MANNER. 4. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTICED THAT ASSESSEE HAS SHOWN EXCESS PURCHASE OF SPARE PARTS OF RS. 21, 700/-. ASSESSEE WAS REQUIRED TO 2 FURNISH COPIES OF BILLS, VOUCHERS, NAME OF THE PART IES FROM WHOM THESE SPARES WERE PURCHASED. IT WAS SUBMITTED THAT THE SPARES PARTS PURCHASED WERE SECOND HAND. THEREFORE, ASSESSEE COULD NOT OBTAIN THE BILLS AND VOUCHERS. T HE ASSESSING OFFICER WAS NOT SATISFIED, THEREFORE, HE DISALLOWED THE AMOUNT OF RS. 21,700/- . 4.1. SAME CONTENTIONS WERE RAISED BEFORE LD. CIT (A ) WHO AFTER CONSIDERING THE SUBMISSIONS FOUND THAT ASSESSEE IS REGULARLY CLAIMI NG EXPENDITURE UNDER THE HEAD SPARE PARTS AND SAME IS ACCEPTED BY THE DEPARTMENT IN PAS T. TOTAL EXPENDITURE ON ACCOUNT OF THESE PARTS WERE CLAIMED AT RS. 2,83,345/- OUT OF W HICH ONLY RS. 21,700/- WERE DISALLOWED. THE LD. CIT (A) WAS OF THE VIEW THAT THERE WAS NO R EASONABLENESS IN DISALLOWING THE SAME. ACCORDINGLY HE DELETED THE ADDITION. 5. WE FIND NO UNREASONABLENESS IN THE FINDING OF LD . CIT (A). ACCORDINGLY WE CONFIRM HIS ORDER ON THIS ISSUE. 6. REGARDING PURCHASE OF DIAMOND SEGMENT AT RS. 2,6 8,320/-, THE ASSESSING OFFICER DISALLOWED THE SAME AS PROPER BILLS WERE NOT FILED BY THE ASSESSEE AND EXPLANATION OF THE ASSESSEE WAS ALSO NOT SATISFACTORY. IT WAS SUBMITT ED BEFORE LD. CIT (A) THAT ASSESSING OFFICERS OBSERVATIONS WERE NOT CORRECT AS WITHOUT THE USE OF SEGMENT/DIAMOND THROUGH WIRE SAW MACHINE NOBODY CAN THINK OF EXTRACTING MAR BLE BLOCKS. THE ASSESSING OFFICER HAS OPINED THAT THE ASSESSEE DOES NOT HAVE WIRE SAW MACHINE, THAN WHY HE HAS NOT THOUGHT LITTLE FURTHER THAT HOW THE MARBLE BLOCKS W ERE PRODUCED, WHEREAS THE ASSESSEE HAS SUBMITTED COPY OF PURCHASE BILL OF WIRE SAW AND DG SET AND ALSO IT IS ON RECORD THAT ASSESSEE IS DOING MINING SINCE 98-99. THE LD. CIT (A) WAS SATISFIED WITH THE EXPLANATION OF THE ASSESSEE. ACCORDINGLY, HE DELETED THIS ADDI TION ALSO. 3 7. AGAIN WE FIND NO INFIRMITY IN THE FINDING OF LD. CIT (A) AS LD. CIT (A) HAS SEEN THE PURCHASE VOUCHERS AS WELL AS THE FACT THAT THE ASSESSEE IS DOING THE SAME BUSINESS SINCE 1998-99. ACCORDINGLY, WE CONFIRM HIS FINDING ON THIS ISSUE ALSO. 8. NEXT ISSUE IS AGAINST DELETING DISALLOWANCE OF M INING EXPENSES AT RS. 4,50,000/-. 9. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTICED THAT IN THE BOOKS OF ACCOUNT THE EXPENSES IN THE NAME OF OVER B URDEN REMOVAL OF RS. 4,50,000/- WAS DEBITED IN CASH ON A SINGLE DAY I.E. 31.8.2002 AFTE R DATE OF SURVEY, BUT NO DETAILS OF THESE EXPENSES WERE FURNISHED. HENCE THE ASSESSEE WAS REQ UIRED TO EXPLAIN THAT WHY THIS AMOUNT SHOULD NOT BE ADDED UNDER SECTION 69C. SUBM ISSIONS WERE FILED. HOWEVER, THE ASSESSING OFFICER WAS NOT SATISFIED. THEREFORE, HE MADE THE IMPUGNED ADDITION. IT WAS SUBMITTED BEFORE LD. CIT (A) THAT A SURVEY OPERATIO N UNDER SECTION 133A ON 29.8.2002 WAS CARRIED OUT AT THE BUSINESS PREMISES OF THE ASS ESSEE. THE AUTHORIZED OFFICER SEIZED SEVERAL LOOSE PAPERS AND DIARY AND ACCOUNTS BOOKS W HICH WERE RELATED TO THE UNACCOUNTED SALES AND UNACCOUNTED MINING EXPENSES OF THE ASSESS EES BUSINESS. THE ASSESSEES BROTHER, SHRI GOPAL SWAROOP OJHA HAS SURRENDERED RS . 10,80,000/- IN HIS HANDS AND RS. 10,00,000/- IN THE HANDS OF THE ASSESSEE. WHILE SUR RENDERING RS. 10,00,000/- IN THE HANDS OF THE ASSESSEE, SHRI GOPAL SWAROOP OJHA STATED IN REPLY TO QUESTION NO.22 THAT RS. 4,50,000/- HAS BEEN INCURRED ON OVER BURDEN REMOVAL AT MINES. THE ASSESSEE HAS ACCEPTED THE STATEMENT OF HIS BROTHER AND HAS FILED HIS RETURN BY INCLUDING RS. 10,00,000/- AS UNDISCLOSED SALES/INCOME AND DEBITED RS. 4,50,00 0/- AS MINING EXPENSES. THEREFORE, DISALLOWANCE BY THE ASSESSING OFFICER WAS NOT JUSTI FIED. FURTHER, WRITTEN SUBMISSIONS WERE ALSO FILED. 4 10. AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESS EE, THE LD. CIT (A) FOUND THAT EXPLANATION OF THE ASSESSEE IS ACCEPTABLE. THE LD. CIT (A) NOTED THAT IT IS CLEAR THAT ASSESSEE HAS MADE SURRENDER OF RS. 10,00,000/- AND RS. 4,50,000/- HAS BEEN ACCOUNTED FOR ON ACCOUNTED OF EXPENDITURE IN MINING. THE ASSESSE E HAS DISCLOSED SURRENDER AMOUNT OF RS. 10,00,000/- IN HIS RETURN OF INCOME, THEREFORE, THERE IS NO QUESTION OF MAKING A FURTHER ADDITION. ACCORDINGLY, HE DELETED THE ADDITION. T HE FINDINGS OF LD. CIT (A) ARE FINDING OF FACT, WHICH, IN OUR CONSIDERED VIEW, DOES NOT REQUI RE ANY INTERFERENCE. THEREFORE, THE SAME IS CONFIRMED. 11. REMAINING ISSUE IS IN RESPECT OF DELETING DISAL LOWANCE OF RS. 27,447/- OUT OF EXCESS AND SHORTAGE OF STOCK. 12. AS PER INVENTORY LIST, TOTAL STOCK OF MARBLE SL ABS VALUED AT RS. 2,93,617/- AS AGAINST DECLARED VALUE AS PER BOOKS OF ACCOUNT AT R S. 2,68,675/-. NO SATISFACTORY EXPLANATION WAS GIVEN IN RESPECT OF SHORTAGE OF STO CK. THEREFORE, THE SAME WAS ADDED TO THE INCOME OF THE ASSESSEE. IT WAS SUBMITTED BEFOR E LD. CIT (A) THAT ASSESSING OFFICER HAS GROSSLY ERRED IN MAKING ADDITION ON ACCOUNT OF DIFFERENCE IN VALUATION OF STOCK TAKEN ON 29.8.2002 BY THE SURVEY PARTY. IT WAS SUBMITTED THAT THIS FIGURE HAS NO RELEVANCE AS THE RETURN HAS BEEN FILED ON 31.3.2003 ON ACTUAL BA SIS AND THE BOOKS OF ACCOUNT HAVE BEEN ACCEPTED. THE LD. CIT (A) WAS SATISFIED WITH THE E XPLANATION . ACCORDINGLY, HE DELETED THE ADDITION. 13. AFTER CONSIDERING THE ORDERS OF THE ASSESSING O FFICER AND LD. CIT (A), AGAIN WE FIND NO INFIRMITY IN THE FINDING OF LD. CIT (A) IN THIS RESPECT ALSO AS THE ASSESSEE HAS FILED RETURN ON THE BASIS OF CLOSE OF THE YEAR AS ON 31.3 .2003 AND ON ACTUAL BASIS STOCK VALUATION HAS BEEN ADOPTED. WHATEVER THE DIFFERENC E WAS THERE ON 29.8.2002 WHICH WAS 5 TAKEN INTO CONSIDERATION WHILE PREPARING FINAL ACCO UNTS AND IN FINAL ACCOUNTS THERE WAS NO DIFFERENCE. THEREFORE, THERE WAS NO JUSTIFICATION IN MAKING ANY ADDITION. ACCORDINGLY, WE CONFIRM THE ORDER OF LD. CIT (A) ON THIS ISSUE ALSO . 14. IN THE RESULT, APPEAL OF THE DEPARTMENT IS DISM ISSED. 15. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 16 .12.2011. SD/- SD/- ( N.L. KALRA ) ( R.K. GUPTA ) ACCOUNTANT MEMBER JUDICIAL MEMBER JODHPUR, COPY FORWARDED TO :- THE ITO WARD-2, CHITTORGARH. SHRI KRISHNA KUMAR OJHA, CHITTORGARH. THE CIT (A) THE CIT THE D/R GUARD FILE (ITA NO. 498/JODH/2010) BY ORDER, AR ITAT JODHPUR.