Puthan Peedikayil Chandran, Kerala V. DCIT, Circle-4(1), Bhubaneswar

ITA 502/CTK/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 2246 (ITAT-CUTTACK)
• Duration Of Justice: 8 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-09-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2014-2015
• Appeal Filed On: 12-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Corroborative evidences
• Section: 43B; 142(1)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH CUTTACK BEFORE SHRI N.S.SAINI, AM & SHRI PAV AN KUMAR GADALE, JM ITA NO. 502 /CTK/201 7 ( [ [ / ASSESSMENT YEAR : 20 14 - 20 1 5 ) PUTHAN PEEDIKAYIL CHANDRAN, KALINGA NIVAS, MONTHAL, KARIYAD SOUTH, KANNUR, KERALA - 673316 VS. DCIT, CIRCLE - 4(1), BHUBANESWAR ./ ./ PAN/TAN NO. : A ASPP 6390 G ( / APPELLANT ) .. ( / RESPONDENT ) [ /AS SESSEE BY : NONE /REVENUE BY : SHRI SUBHENDU DUTTA, DR / DATE OF HEARING : 0 6 / 0 9 /201 8 / DATE OF PRONOUNCEMENT 07 / 0 9 /201 8 / O R D E R PER SHRI PAVAN KUMAR GADALE, J M : TH IS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT (A) - 2 , BHUBANESWAR , DATED 25.08.2017 IN I.T.APPEAL NO. 0119 /2016 - 17 FOR THE ASSESSMENT YEAR 2014 - 2015 . 2. NONE APPEARED ON BEHALF OF THE ASSESSEE WHEN THE CASE WAS CALLED FOR HEARING, NEITHER ANY ADJOURNMENT PETITION HAS BEEN FILED BY THE AS SESSEE, THEREFORE, THE BENCH DECIDED TO DISPOSE OFF AFTER CONSIDERING THE FACTS OF THE CASE AND SUBMISSIONS OF LD. DR. 3 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : - 1. FOR THAT THE LEARNED CIT (APPEAL) HAS FAILED BOTH IN LAW & ON FACTS AD JUDICATE THE SECOND AND FOURTH GROUNDS OF APPEAL BEFORE HIM THAT DISALLOWANCE OF EPF EMPLOYEE'S SHARE IS UNLAWFUL AS IT IS PAID BEFORE DUE DATE OF FILLING OF RETURN AS PER SECTION 43B AND DISALLOWANCE OF CREDITOR FOR WANT OF SOURCE IS BAD IN LAW. 2. FOR THAT, THE LEARNED CIT (APPEALS) IS WRONG AND UNLAWFUL IN IGNORING THE POSITION OF LAW THAT, ADDITION OF CREDITOR FOR WANT OF SOURCE OF SOURCE IS BAD IN LAW. ITA NO. 502 / 17 2 3. FOR THAT THE LEARNED CIT (APPEAL) HAS ERRED BOTH IN LAW & FACT BY IGNORING THE POSITION OF LA W WITH RESPECT TO ANY ADDITION MADE OUT OF SUSPICION, SURMISE, GUESS WITHOUT ANY COGENT REASON IS NOT SUSTAINABLE. 4. THE ASSESSEE CRAVES THE LEAVE OF THIS HONORABLE BENCH TO ADD, ALTER, MODIFY, SUBSTITUTE ANY OF THE ABOVE GROUNDS OR SUBMIT ANY FRESH AD DITIONAL GROUNDS DURING APPEAL PROCEEDING. 4 . THE FACTS IN BRIEF ARE THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF TRADING OF BAKERY AND FILED RETURN OF INCOME ON 24.09.2014 FOR THE A.Y.201 4 - 201 5 DECLARING TOTAL INCOME OF RS. 9, 85 , 53,450 / - . SUBSEQUENTLY THE CASE WAS SELECTED FOR SCRUTINY UNDER CASS AND NOTICES U/S.143(2) & 142(1) OF THE ACT WERE ISSUED. IN COMPLIANCE OF THE SAME, LD. AR APPEARED BEFORE THE AO AND CASE WAS DISCUSSED. THEREAFTER THE AO COMPLETED THE REASSESSMENT ASSESSING TOTAL INCOME AT RS . 9,95,36,660/ - AND PASSED ORDER U/S.143(3) OF THE ACT, DATED 21.11.2016 AND MADE DISALLOWANCE U/S.2(24)(X) R.W.S.36(1)(VA) OF THE ACT AND INTRODUCTION OF CAPITAL . 5 . AGGRIEVED BY THE ORDER OF AO, THE ASSESSEE FILED AN APPEAL BEFORE CIT(A). IN THE APPELLATE PROCEEDINGS THE CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF ASSESSEE AND FINDINGS OF THE AO, PARTLY ALLOWED THE APPEAL OF THE ASSESSEE. 6 . AGGRIEVED BY THE ORDER OF CT(A), THE ASSESSEE HAS FILED THE PRESENT APPEAL BEFORE THE TRIBUNAL. 7 . NONE APPEARED ON BEHALF OF THE ASSESSEE, WHEREAS LD. DR RELIED ON THE ORDER OF AO. 8. WE HAVE HEARD THE SUBMISSIONS OF LD DR AND PERUSED THE MATERIAL ON RECORD. PRIMA FACIE, ON PERUSAL OF THE GROUNDS OF APPEAL WE FOUND THAT ITA NO. 502 / 17 3 THE ASSESSEE HAS RAISED A GROUND THAT THE CIT(A) HAS NOT ADJUDICATED THE ISSUE OF DISALLOWANCE OF EPF EMPLOYEES SHARE CONTRIBUTION RAISED BEFORE HIM. ON PERUSAL OF THE ASSESSMENT ORDER PAGE NO.2 IT IS OBSERVED THAT THE ASSESSEE HAS DEPOSITED THE EPF AMOUNT OF RS.29,224/ - BEFORE DUE DATE OF FILING OF THE RETURN U/S.139 (1) OF THE ACT . EVEN OTHERWISE THE AMOUNT IS DEPOSITED WITHIN THE GRACE PERIOD, ALLOWED UNDER THE EPF ACT. THE ADDITION WAS MADE ON THE GROUND THAT THE EMPLOYEES CONTRIBUTION TO PF WAS NOT DEPOSITED WITHIN THE TIME PRESCRIBED UNDER THE P.F. ACT. WE FIND THAT NO DISALLOWANCE CAN BE MADE FOR DEDUCTION OF THE SAME U/S.36(1)(VA) R.W.S.2(24)( X ) OF THE ACT IN VIEW OF THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF RAJASTHAN STATE BEVERAGES CORPORATION LTD., [2017] 84 TAXMANN.COM 185 (SC), WHER E IT WAS HELD AS UNDER : - SECTION 43B, READ WITH SECTION 36(1)(VA), OF THE INCOME - TAX ACT, 1961 - BUSINESS DISALLOWANCE - CERTAIN DEDUCTIONS TO BE ALLOWED ONLY ON ACTUAL PAYMENT (PF AND ESI CONTRIBUTION) - HIGH COURT BY IMPUGNED ORDER HELD THAT AMOUNT CL AIMED ON PAYMENT OF PF AND ESI HAVING BEEN DEPOSITED ON OR BEFORE DUE DATE OF FILING OF RETURNS, SAME COULD NOT BE DISALLOWED UNDER SECTION 43B OR UNDER SECTION 36(1)(VA) - WHETHER SLP AGAINST SAID IMPUGNED ORDER WAS TO BE DISMISSED - HELD, YES [PARA 2] [I N FAVOUR OF ASSESSEE] 9. WE FIND THAT THE CIT(A) HAS NOT ADJUDICATED THIS GROUND AS RAISED BY THE ASSESSEE IN GROUND NO.1 BEFORE US. ACCORDINGLY, WE RESTORE THE DISPUTED ISSUE TO THE FILE OF CIT(A) TO DECIDE THE CLAIM OF THE ASSESSEE AS PER THE DECISION OF HON BLE SUPREME COURT IN THE CASE OF RAJASTHAN STATE BEVERAGES CORPORATION LTD (SUPRA). THIS GROUND OF APPEAL OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ITA NO. 502 / 17 4 10. IN GROUND NO.2, THE GRIEVANCE OF THE ASSESSEE IS THAT THE CIT(A) ERRED IN SUSTAINING THE ADDITION OF RS. 8,81,000 / - U/S.68 OF THE ACT. 11. THE AO OBSERVED THAT THE ASSESSEE HAS INTRODUCED CAPITAL BY WAY OF CASH OF RS. 9,53,984/ - IN M/S SAJITHA BAKERY. THE AO REQUIRED THE ASSESSEE TO FURNISH THE SOURCE OF THE CAPITAL INTRODUCTION BY HIM. IN REPLY THE ASSESSEE SUBMITTED THAT AN AMOUNT OF RS.3,00,000/ - WAS RECEIVED FROM HIS FATHER MR. P.P.GOVINDAN ON 10.08.2013 BY CASH. FURTHER, AN AMOUNT OF RS.5,81,000/ - WAS RECEIVED FROM MR. SASI T. BY CASH TOWARDS REFUND OF UNSECURED LOAN ON DIFFERENT DATES. THE AO WAS NOT SATISFIED WITH THE EXPLANATION OF THE ASSESSEE AS ACCORDING TO HIM THE ASSESSEE FAILED TO PROVE THE GENUINENESS OF SUCH TRANSACTION WITH DOCUMENTARY EVIDENCE. THEREFORE, THE AO MADE THE ADDITION OF RS. 9,53,984/ - U/S.68 OF THE ACT. ON APPEAL TO T HE CIT(A) AND IN APPELLATE PROCEEDINGS , THE ASSESSEE HAS SUBMITTED THAT DURING THE ASSESSMENT PROCEEDINGS SUPPORTING EVIDENCES REGARDING INTRODUCTION OF CAPITAL WAS FURNISHED BEFORE THE AO. THE CIT(A) HAVING CONSIDERED THE FACTS HAS PARTLY ALLOWED THE APPE AL OF THE ASSESSEE. 12. AGGRIEVED BY THE ORDER OF CIT(A), THE ASSESSEE HAS FILED AN APPEAL BEFORE THE TRIBUNAL. 13. NONE APPEARED ON BEHALF OF THE ASSESSEE. ON THE OTHER HAND, LD. DR SUBMITTED THAT THE ASSESSEE COULD NOT SUBSTANTIATE WITH ANY PROPER EVIDE NCE BEFORE THE LOWER AUTHORITIES, THEREFORE, THE CIT(A) HAS RIGHTLY RESTRICTED THE ADDITION AND PRAYED FOR DISMISSAL OF APPEAL OF THE ASSESSEE. ITA NO. 502 / 17 5 14 . WE HAVE HEARD THE SUBMISSIONS OF LD. DR AND PERUSED THE MATERIAL AVAILABLE ON RECORD. PRIMA FACIE, THE CIT(A ) HAS RESTRICTED THE ADDITION MADE BY THE AO TO THE EXTENT OF RS.8,81,000/ - ON THE GROUND THAT NO PROPER EVIDENCE WAS FILED BY THE ASSESSEE IN SPITE OF PROVIDING OPPORTUNITIES AND FURTHER THE CIT(A) ALSO DEALT ON THE SUBMISSIONS OF THE ASSESSEE IN RESPEC T OF SOURCE S OF CREDITORS FOR CAPITAL INTRODUCTION WHICH WAS FILED IN THE COURSE OF APPELLATE PROCEEDINGS. O N PERUSAL OF THE CIT(A)S ORDER, WE FIND THE CIT(A) HAS CONSIDERED THE SUBMISSIONS, AS ENVISAGED IN THE GROUNDS AND THE ADDITION WAS CONFIRM ED FOR WANT OF EVIDENCE. WE CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE, ARE OF THE SUBSTANTIVE OPINION THAT THE ASSESSEE HAS SUBMITTED THE INFORMATION WHICH WAS NOT TO THE SATISFACTION OF CIT(A). THEREFORE, IN THE INTEREST OF SUBSTANTIAL JUSTICE, WE PROVIDE ONE MORE OPPORTUNITY TO THE ASSESSEE TO SUBSTANTIATE ITS CLAIM PROPERLY ALONG WITH DOCUMENTARY EVIDENCE BEFORE THE CIT(A) AND COOPERATE IN EARLY DISPOSAL OF THE APPEAL AND THE CIT(A) HAS TO CONSIDER THE EVIDENCE AND PASS A SPEAKING ORDER. ACCORDINGLY, THIS GROU ND OF APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 15 . GROUND NOS. 3 & 4 ARE GENERAL NATURE, HENCE, DO NOT REQUIRE ANY ADJUDICATION. 16 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 07 / 09 /201 8 . SD/ - (N. S. SAINI) SD/ - ( PAVAN KUMAR GADALE ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER CUTTACK ; DATED 07 / 09 /2018 . . / PKM , SENIOR PRIVATE SECRETARY ITA NO. 502 / 17 6 / COPY OF THE ORDER FORWARDED TO : / BY ORDER, ( SENIOR PRIVATE SECRETARY ) , / ITAT, CUTTACK 1. / THE APPELLANT - PUTHAN PEEDIKAYIL CHANDRAN, KALINGA NIVAS, MONTHAL, KARIYAD SOUTH, KANNUR, KERALA - 673316 2. / THE RESPONDENT - DCIT, CIRCLE - 4(1), BHUBANESWAR 3. ( ) / THE CIT(A), 4. / CIT 5. , , / DR, ITAT, CUTTACK 6. [ / GUARD FILE. //TRUE COPY//