The Income Tax Officer, Srinagar V. M/s. Haji Wali Mohammad Trading Co., Kashmir

ITA 510/ASR/2013

• Counselvise Citation: 51020914 RSA 2013
• Duration Of Justice: 2 year(s) 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 26-10-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 05-08-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR BEFORE SH. A.D.JAIN, HONBLE JUDICIAL MEMBER AND SH. T.S. KAPOOR, HONBLE ACCOUNTANT MEMBER I.T.A. NO. 510(ASR)/2013 ASSESSMENT YEAR: 2009-10 PAN: AADFH3185J INCOME TAX OFFICE WARD 3(1), SRINAGAR (J&K) VS. M/S. HAJI WALI MOHAMMAD TRADING COMPANY, GOLE MARKET, KARAN NAGAR, SRINAGAR, KASHMIR. (APPELLANT) (RESPONDENT) APPELLANT BY: SH. TARSEM LAL (DR) RESPONDENT BY: SH. SUDHIR SEHGAL (ADV.) DATE OF HEARING: 2 6.10.2015 DATE OF PRONOUNCEM ENT: 06.11.2015 ORDER PER T. S. KAPOOR (AM): THIS IS AN APPEAL FILED BY THE REVENUE AGAINST TH E ORDER OF CIT(A), JAMMU, DATED 13.05.2013 FOR ASST. YEAR 2009-10. 2. THE REVENUE HAS TAKEN FOLLOWING GROUNDS OF APPEA L. (I) ON THE FACTS AND CIRCUMSTANCES WHETHER THE LEA RNED CIT(A) WAS RIGHT IN DELETING THE ADDITION OF RS.18,70,686/- ON ACCOUNT OF APPLYING A RATE OF 6% ON THE TURNOVER DECLARED BY THE ASSESSEE APPELLANT AT RS.3,11,78,112/-. (II) ON THE FACTS AND CIRCUMSTANCES WHETHER THE LEA RNED CIT(A) WAS RIGHT IN DELETING THE ADDITION OF RS.31,41,828/- ON ACCOUNT OF EXCHANGE FLUCTUATION AMOUNTING TO RS.6,58,951/- AND DEPB/DBK AMOUNTING T O RS.24,82,877/-. (III) ON THE FACTS AND CIRCUMSTANCES WHETHER THE LE ARNED CIT(A) HAS FAILED TO APPRECIATE THAT THE ASSESSEE HAS FAILED TO DEDUCT A ND DEPOSIT PF IN RESPECT OF FOUR MONTHS VIZ. MAY 2004, NOVEMBER 2004, JANUARY 2 005 & MARCH 2005 FOR WHICH NO DETAILS HAVE BEEN SUBMITTED IN RESPECT OF THESE FOUR MONTHS. 2. ITA NO. 5 10(ASR)/2013 ASST. YEAR 2009-10 3. THE APPEAL WAS EARLIER DISMISSED VIDE TRIBU NAL ORDER DATED 20 TH DECEMBER, 2013. IT WAS DISMISSED AS THE REVENUE HAD NOT RECTIFIED DEFECTS IN THE APPEAL. HOWEVER, THE SAID TRIBUNAL ORDER WAS RE CALLED VIDE ORDER DATED 12 TH SEPTEMBER, 2014 AND THE APPEAL WAS LISTED FOR HEARI NG ON MERITS. 4. AT THE OUTSET THE LEARNED DR INVITED OUR ATTENTI ON TO ASSESSMENT ORDER AND SUBMITTED THAT THE ASSESSEE WAS NOT CO-OPERATIV E AND DID NOT FILE COMPLETE DETAILS AND DID NOT PROVIDE COMPLETE BOOKS OF ACCOU NT AND THEREFORE, THE ASSESSING OFFICE HAD RIGHTLY REJECTED THE BOOKS OF ACCOUNT AND HAD RIGHTLY APPLIED NET PROFIT RATIO OF 6%. 5. AS REGARDS OTHER ADDITIONS ON ACCOUNT OF DEPB/DU TY DRAWBACK THE LEARNED AR PLACED HIS RELIANCE ON THE ASSESSMENT OR DER. THE LEARNED AR ON THE OTHER HAND, SUBMITTED THAT NO SPECIFIC DEFECT WAS P OINTED OUT BY THE ASSESSING OFFICER AND THEREFORE, THE LEARNED CIT(A) HAS RIGHT LY DELETED THE ADDITIONS. HE SUBMITTED THAT ASSESSING OFFICER HIMSELF IN PARA 1. 3 OF HIS ORDER HAS OBSERVED THAT BANK STATEMENTS AND VOUCHERS IN RESPECT OF PUR CHASES AND SOME EXPENSES WERE PERUSED AND SOME CREDITORS CONFIRMATI ONS WERE OBTAINED. THE LEARNED AR FURTHER SUBMITTED THAT THERE WAS NO EVID ENCE FOR ANY DEFECT IN BOOKS OF ACCOUNT AND MOREOVER THE ASSESSEE WAS NOT SHOW CAUSED REGARDING REJECTION OF BOOKS OF ACCOUNT AND APPLICATION OF AD HOC RATE OF 6% ON TURNOVER. 6. AS REGARDS THE SECOND ADDITION ON ACCOUNT OF DEP B/DUTY DRAWBACK ETC. THE LEARNED AR SUBMITTED THAT THE NET PROFIT COMPUT ED IN THE PROFIT AND LOSS ACCOUNT ALREADY TOOK INTO ACCOUNT THE INCOME ON ACC OUNT OF DUTY DRAWBACK OF 3. ITA NO. 5 10(ASR)/2013 ASST. YEAR 2009-10 EXCHANGE FLUCTUATION AND THEREFORE, NO SEPARATE ADD ITION WAS CALLED FOR. HE SUBMITTED THAT DEPB/DUTY DRAWBACK ETC. ARE EXPORT B ENEFITS WHICH ARE GIVEN TO ASSESSEES TO MAKE THEM COMPETITIVE IN THE EXPORT MARKET AND THE EXPORTERS WHILE FIXING THE PRICES ALWAYS KEEP IN MIND SUCH BE NEFITS. 7. AS REGARDS THE THIRD GROUND OF APPEAL THE LEARNE D AR SUBMITTED THAT THIS GROUND OF APPEAL IS NOT ARISING OUT OF EITHER ASSES SMENT ORDER OR LEARNED CIT(A)S ORDER. 8. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE TH ROUGH THE MATERIAL PLACED ON RECORD. WE FIND THAT THE LEANED CIT(A) HA S RECORDED A FINDING OF FACT THAT ASSESSING OFFICER HAS MADE ADDITION WITHOUT AN Y BASIS AND WITHOUT CITING ANY COMPARABLE CASE. HE FURTHER HELD THAT ASSESSING OFFICER DID NOT GIVE A SHOW CAUSE NOTICE FOR REJECTION OF BOOKS OF ACCOUNT AND FOR APPLYING AD HOC PROFIT RATE OF 6%. WE FURTHER FIND THAT ASSESSING O FFICER WAS NOT ABLE TO PINPOINT ANY SPECIFIC ACTUAL DEFICIENCY IN THE BOOK S OF ACCOUNT AND RATHER HE HELD THAT BANK STATEMENTS AND VOUCHERS IN RESPECT O F PURCHASES AND SOME EXPENSES WERE PROVIDED AND CONFIRMATIONS WERE OBTAI NED FROM A SELECT NUMBER OF CREDITORS. THEREFORE, WE SEE MERITS IN THE ARGUM ENTS OF LEARNED AR AND THEREFORE, DO NOT FIND ANY INFIRMITY IN THE ORDER O F LEARNED CIT(A). 8.1 AS REGARDS THE OTHER ADDITION OF RS.31,41,828/- WHICH THE ASSESSING OFFICER HAD MADE ON ACCOUNT OF CREDIT TO PROFIT AND LOSS ACCOUNT OF DEPB/DUTY DRAWBACK AMOUNTS, WE FIND THAT THE FIGURE WAS ALREA DY CREDITED TO THE PROFIT AND LOSS ACCOUNT AND PROFIT DECLARED BY ASSESSEE IN ITS PROFIT AND LOSS ACCOUNT 4. ITA NO. 5 10(ASR)/2013 ASST. YEAR 2009-10 CONTAINED CREDIT FOR THESE AMOUNTS ALSO AND ASSESSI NG OFFICER WAS NOT JUSTIFIED TO MAKE A SEPARATE ADDITION FOR THIS AMOUNT AND THE REFORE, LEARNED CIT(A) HAS RIGHTLY DELETED THE ADDITIONS ON ACCOUNT OF DEPB/DU TY DRAWBACK. IN VIEW OF THE ABOVE GROUND NOS. 1 & 2 ARE DISMISSED. 8.2 AS REGARDS GROUND NO. 3 OF APPEAL, WE FIND THAT NEITHER ASSESSING OFFICER MADE THIS ADDITION NOR LEARNED CIT(A) GAVE RELIEF O N THIS ACCOUNT AND THEREFORE, THIS GROUND OF APPEAL IS NOT RELEVANT AND THEREFORE IS DISMISSED. 9. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 6 TH NOVEMBER, 2015. SD/- SD/- (A.D. JAIN) (T. S. KAPOOR) JUDICIAL MEMBER ACCOUNTA NT MEMBER DATED: 06.11.2015. /PK/ PS. COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE: M/S HAJI WALI MOHAMMAD TRADING COMPAN Y, SRINAGAR. 2. THE INCOME TAX OFFICER, WARD 3(1) SRINAGAR (J&K). 3. THE CIT, 4. THE SR DR, I.T.A.T., TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR.