M/s Vaibahv Textile, V. The ITO,

ITA 531/IND/2005

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 1430 (ITAT-INDORE)
• Duration Of Justice: 4 year(s) 5 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-11-2009
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 25-11-2009
• Assessment Year: 1997-1998
• Appeal Filed On: 22-06-2005
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: APARNA KARAN
• Section: 143(3)

Judgement Text

PAGE 1 OF 5 - I.T.A.NO. 531/IND/2005 VAIBHAV TEXTILES,UJJAIN IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH : INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI V.K. GUPTA, ACCOUNTANT MEMBER PAN NO. : AEZPJ 4849 K I.T.A.NO. 531/IND/2005 A.Y. : 1997-98 M/S. VAIBHAV TEXTILES, INCOME-TAX OFFICER, C/O M/S. S.C.GOYAL & CO.,C.A., 19, SHANKU MARG, FREEGANJ, UJJAIN VS UJJAIN APPELLANT RESPONDENT APPELLANT BY : SHRI AJAY TULSIYAN, C. A. RESPONDENT BY : SMT.APARNA KARAN, SR. DR DATE OF HEARING : 25/11/2009 O R D E R PER V.K. GUPTA, A.M. THIS APPEAL FILED BY THE ASSESSEE ARISES OUT OF ORD ER OF THE LD. CIT(A), UJJAIN, DATED 29.03.2005, FOR THE ASSESSMEN T YEAR 1997-98. 2. WE HAVE HEARD BOTH THE PARTIES AND HAVE ALSO PERUSE D THE MATERIAL AVAILABLE ON RECORD. 3. IN GROUND NO. 1, THE ASSESSEE IS AGGRIEVED BY THE DECISION OF THE LD. CIT(A) IN CONFIRMING THE DISALLOWANCE OF RS. 1, 77,020/- PAGE 2 OF 5 - I.T.A.NO. 531/IND/2005 VAIBHAV TEXTILES,UJJAIN 4. THE FACTS, IN BRIEF, ARE THAT THE ASSESSEE IS A PAR TNERSHIP FIRM. IN THE COURSE OF ASSESSMENT PROCEEDINGS U/S 143(3) REA D WITH SECTION 263, A DIARY WAS FOUND, WHEREIN NOTINGS IN THE HAND WRITIN G OF ONE OF THE PARTNERS WERE MADE. THE A.O. FURTHER FOUND THAT THE SE NOTINGS WERE CONNECTED WITH THE EXPENSES RELATING TO THE FIRM. T HE A.O. REQUIRED THE ASSESSEE TO EXPLAIN THE NATURE OF THESE ENTRIES FOR THE REASON THAT THE A.O. WAS OF THE OPINION THAT THESE EXPENSES WERE NOT REC ORDED IN THE BOOKS OF ACCOUNT OF THE FIRM AND HAD BEEN SPENT FROM THE UND ISCLOSED SOURCES OF THE ASSESSEE FIRM. THE ASSESSEE, HOWEVER, SUBMITTED THAT THESE EXPENSES/NOTINGS PERTAINED TO THE PERSONAL TRANSACT IONS OF THE PARTNERS, HENCE, COULD NOT BE ADDED IN THE HANDS OF THE FIRM. THE A.O., HOWEVER, ADDED THE SAME AS UNDISCLOSED INCOME OF THE FIRM. O N APPEAL, THE LD. CIT(A) ALSO CONFIRMED THE ADDITION SO MADE BY THE A SSESSING OFFICER FOR THE REASON THAT THE ASSESSEE FAILED TO FILE ANY CON FIRMATION OF SHRI MANOJ TIWARI TO THE EFFECT THAT THESE TRANSACTIONS WERE N OT RELATED TO THE ASSESSEE FIRM NOR ANY SERIOUS ATTEMPT WAS MADE BY THE ASSESS EE TO SHOW THAT SUCH EXPENSES HAD ALREADY BEEN ACCOUNTED FOR IN THE BOOK S OF ACCOUNT OF THE FIRM. THE LD. CIT(A) ALSO HELD THAT SINCE DIARY REL ATED TO THE EXPENSES OF THE FIRM, HENCE, ONUS WAS ON THE ASSESSEE TO EXPLAI N SUCH TRANSACTIONS BY ADDUCING NECESSARY EVIDENCES, BUT THE ASSESSEE FAIL ED TO DISCHARGE SUCH ONUS. STILL AGGRIEVED, THE ASSESSEE IS IN APPEAL BE FORE US. PAGE 3 OF 5 - I.T.A.NO. 531/IND/2005 VAIBHAV TEXTILES,UJJAIN 5. THE LEARNED COUNSEL FOR THE ASSESSEE MAINLY REITERA TED THE SUBMISSIONS MADE BEFORE THE REVENUE AUTHORITIES. TH E LD. DEPARTMENTAL REPRESENTATIVE, ON THE OTHER HAND, PLACED STRONG RE LIANCE ON THE ORDER OF THE LD. CIT(A). 6. WE HAVE CONSIDERED THE SUBMISSIONS MADE BY BOTH THE SIDES, MATERIAL ON RECORD AND THE ORDERS OF THE AUTHORITIE S BELOW. 7. IT IS NOTED THAT EVEN DURING THE COURSE OF HEARING BEFORE US, THE ASSESSEE HAS NOT BEEN ABLE TO COUNTER THE ALLEGATIO NS MADE BY THE CIT(A) BY ADDUCING ANY EVIDENCE. HENCE, WE ARE OF THE VIEW THAT THE ORDER OF THE LD. CIT(A), WHICH IS BASED ON PROPER APPRECIATION O F FACTS AS WELL AS OF LAW, IS LIABLE TO BE CONFIRMED. WE ORDER ACCORDINGL Y. THUS, THIS GROUND OF THE ASSESSEE IS DISMISSED. 8. GROUND NO.2 READS AS UNDER :- BECAUSE THE LD. AUTHORITIES BELOW ERRED IN CHARGIN G TAX ON RS. 15,500/- ON FACTS AND IN CIRCUMSTANCES OF THE C ASE. THIS IS NOT CORRECT BOTH ON FACTS & IN LAW. 9. THE FACTS, IN BRIEF, ARE THAT THE A.O. FOUND THAT T HE EXPENSES REGARDING POPULAR, TANKHA OF SHRI MURLI, CEMENT, LI ME AGGREGATING TO RS. 15,500/- WERE FOUND NOTED ON THE DIARY, WHICH WERE RELATED TO THE FIRM THEREIN, HOWEVER, SUCH EXPENSES WERE NOT RECORDED I N THE FIRMS BOOKS. HENCE, FOR WANT OF PROPER EXPLANATION, THE A.O. ADD ED THE SAME TO THE PAGE 4 OF 5 - I.T.A.NO. 531/IND/2005 VAIBHAV TEXTILES,UJJAIN TOTAL INCOME OF THE ASSESSEE FIRM. THE LD. CIT(A) A LSO CONFIRMED THE ACTION OF THE A.O. FOR THE SAME REASONS. STILL AGG RIEVED, THE ASSESSEE IS IN APPEAL BEFORE US. 10. THE LEARNED COUNSEL MAINLY REITERATED THE SUBMISSIO NS MADE BEFORE THE LOWER AUTHORITIES. THE LD. DEPARTMENTAL REPRESENTATIVE PLACED STRONG RELIANCE ON THE ORDER OF THE LD. CIT(A). 11. WE HAVE CONSIDERED THE SUBMISSIONS MADE BY BOTH THE SIDES, MATERIAL ON RECORD AND THE ORDERS OF THE AUTHORITIE S BELOW. 12. ON DUE CONSIDERATION OF THE FACT THAT THE ASSESSEE HAS NOT BEEN ABLE TO GIVE ANY EXPLANATION AS REGARDS TO THE SOUR CE OF SUCH EXPENSES OR THIS BEING ALREADY RECORDED IN THE BOOKS OF ACCOUNT OF THE FIRM AT ANY STAGE, WE ARE LEFT WITH NO OPTION BUT TO CONFIRM TH E SAME. ACCORDINGLY, THIS GROUND OF THE ASSESSEE IS ALSO DISMISSED. 13. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. PAGE 5 OF 5 - I.T.A.NO. 531/IND/2005 VAIBHAV TEXTILES,UJJAIN THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 27 TH NOVEMBER, 2009. SD/- SD/- (JOGINDER SINGH) (V. K. GUPTA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED :27 TH NOVEMBER, 2009. CPU* 2526D26