Radhey Shyam Chugh, SURATGARH V. ITO, SURATGARH

ITA 526/JODH/2010

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 3035 (ITAT-JODHPUR)
• Duration Of Justice: 2 year(s) 5 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 22-02-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 10-11-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: G R KOKANI
• Section: 133A

Judgement Text

1 IN THE INCOME TAX APPELALTE TRIBUNAL : JODHPUR BENC H : JODHPUR BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER. ITA NO. 526/JODH/2010 (A.Y. 2007-08) RADHEY SHYAM CHUGH VS ITO, PROP. M/S. NAREN SINGHGURDITTA RAM SURATGARH SURAGARH. PAN NO. AAXPC9785F (APPELLANT ) (RESPONDENT) ASSESSEE BY : SHRI SURESH OJHA. DEPARTMENT BY : SHRI G.R. KOKANI (DR) DATE OF HEARING : 14/03/2013. DATE OF PRONOUNCEMENT: 30/04/2013. PER HARI OM MARATHA, J.M.: THIS APPEAL OF THE ASSESSEE FOR A.Y. 2007-08 IS D IRECTED AGAINST THE ORDER OF LD. CIT(A), BIKANER, DATED 25/08/2010. 2. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE ASSESSEE CARRIES ON A BUSINESS OF COMMISSION AGENT OF FOOD GRAINS BE SIDES ALSO SELLING FOOD-GRAINS. THE ASSESSEE DOES HIS BUSINESS AS PROP RIETOR OF HIS CONCERN M/S. NAREN SINGH GURDITTA RAM, SURATGARH. A SURVEY U/S 133A OF THE 2 I.T. ACT 1961 (REFERRED TO AS THE ACT FOR SHORT, HEREINAFTER), ON 17/10/2007. DURING THIS SURVEY CERTAIN LOOSE-PAPERS AND BOOKS OF ACCOUNTS WERE IMPOUNDED. REGULAR ASSESSMENT ORDER W AS PASSED VIDE ORDER DATED 22/12/2009 BY THE ITO, SURATGARH IN WHI CH VARIOUS ADDITIONS MADE WHICH WERE CHALLENGED AND LD. CIT(A) , BIKANER HAS GIVEN PART RELIEF TO THE ASSESSEE. THE ASSESSEE IS NOT SATISFIED AND HAS PREFERRED THIS SECOND APPEAL AGAINST THE SUSTAINED ADDITIONS. IT WAS INFORM BY THE REPRESENTATIVES OF BOTH THE PARTIES T HAT REVENUE HAS NOT FILED APPEAL AGAINST DELETED ADDITION. 3. WE HAVE HEARD RIVAL SUBMISSIONS ON THE GROUND RA ISED. THE LD. AR HAS FILED WRITTEN SUBMISSION (W.S), A COPY OF WHICH WAS GIVEN TO LD. DR, WHO HAS REPLIED THE SAME. AFTER CONSIDERING ALL THE RELEVANT FACTS, EVIDENCE AND ORAL/WRITTEN SUBMISSIONS OF THE PARTIE S, WE ARE PROCEEDING TO ADJUDICATE UPON THE CONTENTIONS GROUN DS RAISE DIN THE APPEAL. 4. THE FIRST GROUND IS IN RESPECT OF DISALLOWANCE O F INTEREST OF RS. 4275/-. PAGE 41 OF THE ANNEXURE A-13, FOUND DURING SURVEY, IS A COPY OF ACCOUNT OF M/S. SACHIN TRADING COMPANY, SURATGAR H. AS PER THIS 3 PAPER INTEREST CHARGED COMES TO RS. 25,650/-, AT TH E RATE OF 18% P.A., WHEREAS IN THE BOOKS OF ACCOUNTS THE ASSESSEE HAS S HOWN INTEREST CHARGED FROM M/S. SACHIN TRADING CO. AT RS. 21,375/ -. THE AO TREATED THE BOOK ENTRY AS INCORRECT AND ON THE BASIS OF PAG E 41 OF THE LOOSE- PAPERS, HE HAS ADDED THE DIFFERENCE AMOUNT OF RS. 4 ,275/-, WHICH AHS ALSO BEEN CONFIRMED BY LD. CIT(A). 5. AFTER HEARING BOTH PARTIES, WE HAVE FOUND THAT T HE LOOSE PAGE NO. 41 OF ANNEXURE A-13 IS NOT SIGNED BY ANY PARTY. BET WEEN THE PARTIES, FINALLY, 15% RATE OF INTEREST MAY HAVE BEEN MUTUALL Y AGREED INSTEAD OF 18% MENTIONED ON THIS PAGE. M/S. SACHIN TRADING COM PANY AHS CONFIRMED THIS FACT, AND A COPY OF ACCOUNTS WERE PR ODUCED. IN OUR OPINION THE EXPLANATION OF THE ASSESSEE SEEMS TO BE PLAUSIBLE, AND IT IS ALSO SUPPORTED BY CONFIRMATION OF THE OTHER PARTY. THIS ADDITION NEEDS TO BE DELETED FROM ASSESSEES HANDS. WE ORDER ACCOR DINGLY; AND ALLOW GROUND NO. (1) OF ASSESSEES APPEAL. 6. GROUND NO. 2 AND 3, ARE DISMISSED AS NOT PRESSED . 4 7. GROUND NO. (4) IS REGARDING ADDITION OF RS. 91,9 96/- ON ACCOUNT OF DISCREPANCIES IN THE CASH BALANCE. AS PER PAGES 76 TO 80 OF ANNEXURE A- 13, BEING THE TRADING AND PROFIT / LOSS ACCOUNT AND BALANCE SHEET OF FIRM M/S. NARAYAN SINGH GURDITTA RAM, ANOTHER PROPR IETARY FIRM OF THE ASSESSSEE. AS PER THESE PAPERS CASH-BALANCE AS ON 3 1/03/2007 WAS RS. 1,12,896/-, BUT IN THE BOOKS IT IS SHOWN AT RS. 20, 900/-. IN THE ABSENCE OF SATISFACTORY EXPLANATION THE AO AHS ADDED THE DI FFERENCE AMOUNT OF RS. 91,996/- WHICH HAS ALSO BEEN CONFIRMED BY LD. C IT(A). 8. BEFORE US BOTH PARTIES REITERATED THEIR ORIGINAL STAND. AS PER THE ASSESSEE THESE LOOSE-PAPERS ARE NOT FINAL DOCUMENTS AND ARE ONLY ROUGH PROPOSALS. IT WAS EXPLAINED THAT CERTAIN ENTRIES RE MAINED TO HAVE BEEN CONSIDERED AND WHEN THESE WERE FINALLY CONSIDERED T HE EXACT CASH BALANCE OF RS. 20,900/- REMAINED WHICH HAS BEEN BOO KED. COPIES OF ACCOUNT IN RESPECT OF THOSE ENTRIES WERE PRODUCED B EFORE THE AO. THE CASE OF LD. AR IS THAT THE ABOVE EXPLANATION WAS NO T AT ALL CONSIDERED BY AO AND ALSO BY LD. CIT(A). THE LD. D.R. HAS REPE ATED THE REASONS GIVEN IN THE ORDERS TO SUPPORT THIS ADDITION. 9. HAVING COGITATED THE RIVAL STANDS IN THE LIGHT O F EVIDENCE AVAILABLE ON RECORD. WE, ARE SATISFIED THAT THE ASS ESSEE AHS CLEARLY 5 EXPLAINED THIS DIFFERENCE. BOTH THE AUTHORITIES BEL OW HAVE TREATED THE EVIDENCE FOUND DURING SURVEY AS SACROSANCT AND IGNO RED TO CONSIDERED THE EXPLANATIONS OF THE ASSESSEES SIDE. ACTUALLY, THE ASSESSEE AHS A LEGAL LIGHT AND ALSO A DUTY TO EXPLAIN WITH PLAUSIB LE EVIDENCE ANY DISCREPANCY FOUND OR NOTICED DURING SURVEY PROCEEDI NGS. WE HAVE EXAMINED ALL THE RECORDS AND HAVE FOUND THAT THE AS SESSEE HAS PROPERLY EXPLAINED THIS DIFFERENCE IN CASH BALANCE AND THE I MPUGNED ADDITIONS DESERVES TO BE DELETED. THE BALANCE SHEET FOUND IN SURVEY WAS INCOMPLETE. THERE WAS A CHEQUE IN HAND AMOUNTING TO RS. 10,000/-. COPIES OF THE ACCOUNTS AT SERIAL NOS 1 TO 7 AT PAGE S 39 TO 44 OF APB ARE RELEVANT. ACCORDINGLY, WE ORDERED TO DELETE THIS AD DITION OF RS. 91,996/- AND ALLOW GROUND NO. (4) OF THIS APPEAL. 10. WE HAVE EXAMINED THE ALTERNATIVE PLEA RAISED BY LD. AR IN THE WRITTEN SUBMISSIONS AND ORALLY AS WELL. WE HAVE ALS O NOTICED THAT THE FOLLOWING AMOUNT STAND EXPLAINED BY THE ASSESSEE :- DIFFERENCE OF INTEREST : RS. 4275/- CASH BALANCE : RS. 91996/- CLOSING STOCK : RS. 35084/- DISALLOWED EXPENSES : RS. 8962/- TOTAL : RS. 140317/- 6 THE ASSESSEE HAS SURRENDERED A SUM OF RS. 1,60,000/ -. AFTER REDUCING THEIR AMOUNT OUT OF TOTAL ADDITION OF RS. 3,84,133/ -, THE ADDITION REMAINS AT RS. 2,43,816/-. AFTER REDUCING THIS SURR ENDERED AMOUNT OF RS. 1,60,000/-, ADDITION OF RS. 83,816/- (RS. 2,43, 816/- - RS. 1,60,000/-) CAN BE ADDED TO THE DECLARED INCOME OF THE ASSESSEE. THEREFORE, WE ACCEPT THIS ALTERNATIVE PLEA OF LD. A .R. AND AFTER WE SUSTAIN TOTAL ADDITION OF RS. 83,816/- TREATING IT AS NOT EXPLAINED. IN VIEW OF THE ABOVE, WE DONT FIND A NEED TO DECIDE O THER EXPLANATORY GROUNDS OF THIS APPEAL, AND ALLOW THIS APPEAL IN P ART. 11. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PA RTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 30 . 04.2013. SD/- SD/- [N.K. SAINI] [HARI OM MARATHA] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 30 TH APRIL, 2013. VL COPY TO ALL CONCERNED.