M/S M.P. PASCHIM KSHETRA VIDYUT VITARAN CO. LTD., Indore V. THE CIT-I, Indore

ITA 521/IND/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 5861 (ITAT-INDORE)
• Duration Of Justice: 1 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-07-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 13-05-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAJIV VARSHNEY
• Assessee Lawyers: T N UNNI; PAVITRAN NAMBIAR
• Keywords: Opportunity of being heard
• Section: 143(3); 263

Judgement Text

M.P. PASHCHIM KSHETRA VIDYUT VITARAN CO. LTD ITA NO. 521/IND/2016 1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI D.T. GARASIA, JM & SHRI N.S. SAINI, AM ITA NO. 521/IND/2016 A.Y.2011-12 M.P. PASCHIM KSHETRA VIDYUT VITARAN CO.LTD. INDORE PAN AADCM 7397N ::: APPELLANT VS COMMISSIONER OF INCOME TAX-I INDORE ::: RESPONDENT APPELLANT BY SHRI T.N. UNNI & SHRI PAVITRAN NAMBIAR RESPONDENT BY SHRI RAJIV VARSHNEY DATE OF HEARING 11.7.2016 DATE OF PRONOUNCEMENT 11.7.2016 O R D E R THIS IS AN APPEAL PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF THE LEARNED CIT-I, INDORE, DATED 11.3.2016. M.P. PASHCHIM KSHETRA VIDYUT VITARAN CO. LTD ITA NO. 521/IND/2016 2 2. THE SOLE GROUND OF APPEAL IS THAT THE LEARNED CIT E RRED IN HOLDING THAT THE ASSESSMENT ORDER PASSED U/S 143(3) OF THE ACT DATED 27.3.2014 IS WITHOUT APPLICATION OF MIND BY THE ASSESSING OFFICER AND, THEREFORE, ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. 3. THE CIT ISSUED NOTICE U/S 263 OF THE ACT ON 2.3. 2006 ON THE GROUND THAT THE ASSESSEE HAS SHOWN RECEIPTS OF RS.21,88,21,993/- AS SUPPLY AFFORDING CHARGES AND RS.3,91,92,022/- AS ELECTRIFICATION CHARGES IN SCHEDUL E-34 OF THE BALANCE SHEET. SINCE BOTH THE RECEIPTS WERE CO LLECTED BY WAY OF CHARGES FROM CUSTOMERS FOR HAVING BEEN FACILITATED A PARTICULAR SERVICE, INCLUDING SOME ITEMS O F STOCK IN TRADE/CIRCULATING ASSETS TO THEM, SO RECEIPTS DERIVED FROM SUCH BASIC SERVICE TO THE CUSTOMERS MA Y BE CHARACTERISED ONLY AS REVENUE RECEIPTS. ON THE SAME ISS UE, BOTH RECEIPTS DERIVED FROM CUSTOMERS WERE TREATED AS REVENUE RECEIPTS AND ADDED IN THE TOTAL INCOME OF THE M.P. PASHCHIM KSHETRA VIDYUT VITARAN CO. LTD ITA NO. 521/IND/2016 3 ASSESSEE FOR THE A.Y. 2012-13. THEREFORE, THE REMEDI AL MEASURES NEED TO BE TAKEN. THE LEARNED CIT AFTER HEARING THE CASE HELD THAT FROM THE ASSESSMENT ORDER U/S 143(3 ) DATED 27.3.2014 IT IS CLEAR THAT THE ASSESSING OFFICER HAS NOT APPLIED HIS MIND ATALL AND THE ASSESSMENT ORDER IN T HIS CASE IS AN ERRONEOUS ORDER SINCE IT DID NOT TAKE COGNI ZANCE OF THE POINTS MENTIONED ABOVE AND, THEREFORE, THERE I S A FAILURE TO MAKE SUCH INQUIRY AND THE ORDER IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. THERE FORE, HE HAS SET ASIDE THE ORDER OF THE ASSESSING OFFICER AND DIRECTED HIM TO REFRAME THE ASSESSMENT AFTER EXAMINING THE ISSUES AFTER AFFORDING SUFFICIENT OPPORTUNITY OF BEIN G HEARD TO THE ASSESSEE. 4. BEING AGGRIEVED WITH THIS ORDER, THE ASSESSEE IS I N APPEAL BEFORE US. THE LEARNED COUNSEL FOR THE ASSESSEE DURING THE COURSE OF HEARING SUBMITTED THAT THE ISSU ES IN QUESTION WERE EXAMINED BY THE ASSESSING OFFICER. HE R ELIED M.P. PASHCHIM KSHETRA VIDYUT VITARAN CO. LTD ITA NO. 521/IND/2016 4 ON PAGES 66 TO 68 OF THE PAPER BOOK AND SUBMITTED THAT THE LETTER DATED 11.2.2014 WAS ISSUED REQUIRING THE ASSESSE E TO EXPLAIN VARIOUS POINTS WITH RESPECT TO THE RETURN OF INCOME FILED AND THEN REFERRED TO PAGES 69 TO 74 OF THE PAPER BOOK AND SUBMITTED THAT THE ASSESSEE REPLIED TO THE SAME. THEREFORE, IT CANNOT BE SAID THAT THE ASSESSMENT ORDER MADE BY THE ASSESSING OFFICER WAS WITHOUT APPLICATION O F MIND AND, HENCE, ERRONEOUS AND PREJUDICIAL TO THE INTE REST OF THE REVENUE. 5. ON THE OTHER HAND, THE LEARNED DR SUBMITTED THAT IN THE ORDER U/S 263 AS WELL AS NOTICE U/S 263 THE CIT H AS REFERRED TO RECEIPTS OF RS.21,88,21,993/- UNDER THE HEAD SUPPLY AFFORDING CHARGES AND RS.3,91,92,022/- AS ELECTRIFICATION CHARGES IN SCHEDULE-34 TO THE BALANCE S HEET AND THAT THEY WERE NOT OFFERED TO TAX BY THE ASSESSEE AND THESE WERE NOT EXAMINED BY THE ASSESSING OFFICER. AT PAGES 66 TO 74 REFERRED TO BY THE ASSESSEE THERE IS NO ME NTION M.P. PASHCHIM KSHETRA VIDYUT VITARAN CO. LTD ITA NO. 521/IND/2016 5 ABOUT THE SAID FIGURES AND, HENCE, THE ISSUE WAS NOT EXAMINED BY THE ASSESSING OFFICER AS CONTENDED BY THE LEARNED COUNSEL FOR THE ASSESSEE. 6. THE LEARNED COUNSEL FOR THE ASSESSEE COULD NOT CONTROVERT THE ABOVE SUBMISSIONS OF THE LEARNED DR. AFTER CONSIDERING THE RIVAL SUBMISSIONS AND PERUSING THE MATERIAL AVAILABLE ON RECORD WE FIND THAT IN THE ASSESSMEN T ORDER DATED 27.3.2014 PASSED U/S 143(3) OF THE ACT T HE ASSESSING OFFICER HAS NOT DISCUSSED THE RECEIPTS OF RS.21,88,21,993/- UNDER THE HEAD SUPPLY AFFORDING CHARGES AND RS.3,91,92,022/- AS ELECTRIFICATION CHARGES. THUS, HE HAS NOT EXAMINED THE SAME. FURTHER AT PAGES 66 TO 74 OF THE PAPER BOOK REFERRED TO BY THE LEARNED CO UNSEL FOR THE ASSESSEE THERE IS NO QUESTION ON THE ABOVE TWO POINTS RAISED BY THE ASSESSING OFFICER AND REPLY OF T HE ASSESSEE ON THOSE POINTS. THEREFORE, IN THE ABOVE FAC TS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE CONSIDERED VI EW M.P. PASHCHIM KSHETRA VIDYUT VITARAN CO. LTD ITA NO. 521/IND/2016 6 THAT THESE ISSUES WERE NOT EXAMINED BY THE ASSESSING OFFICER AND THE ASSESSING OFFICER HAS NOT ARRIVED AT A CONSCIOUS DECISION WHETHER THE SAID RECEIPTS ARE CHARGEABLE TO TAX. THEREFORE, IN OUR CONSIDERED OPINI ON, THE CIT HAS RIGHTLY INVOKED THE JURISDICTION U/S 263 OF THE ACT AND SET ASIDE THE ORDER OF THE ASSESSING OFFICER AND REMANDED THE MATTER TO HIM TO ADJUDICATE THESE ISSUES AFTER ALLOWING REASONABLE OPPORTUNITY OF BEING HEARD. HENCE, WE FIND NO INFIRMITY IN THE ORDER OF THE CIT WHICH IS CONFIRMED AND THE APPEAL OF THE ASSESSEE IS DISMISSED. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMISSED. PRONOUNCED IN OPEN COURT ON 11 TH JULY, 2016 SD/- SD/- (D.T. GARASIA) (N.S. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER 11 TH JULY, 2016 DN/- M.P. PASHCHIM KSHETRA VIDYUT VITARAN CO. LTD ITA NO. 521/IND/2016 7 M.P. PASHCHIM KSHETRA VIDYUT VITARAN CO. LTD ITA NO. 521/IND/2016 8