ACIT, New Delhi V. Sh. Rajesh Kumar, Delhi

ITA 5860/DEL/2015

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 4007 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 2 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-01-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Assessment Year: 2010-2011
• Appeal Filed On: 28-10-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D NEW DELHI BEFORE SHRI B.P. JAIN, ACCOUNTANT MEMBE R AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA NO. 5860/DEL/2015 AY: 20 10-11 ACIT, VS SHRI RAJESH KUMAR, CIRCLE-51(1), PROP. M/S DAILY FOODS 8650, GFDCM SCHOOL ROAD, GAUSHALLA MARG, RATAN NAGAR, DELHI-110006 & 217, 218, JOSHI ROAD, KAROL BAGH, NEW DELHI-110005 (APPELLANT) (RESPONDENT) APPELLANT BY : NONE RESPONDENT BY : SHRI AMIT JAIN, SR. DR DATE OF HEARING: 22.01.2018 DATE OF PRONOUNCEMENT: 25.01.2018 ORDER PER SUDHANSHU SRIVASTAVA, J.M. THIS APPEAL HAS BEEN PREFERRED BY THE DEPARTMENT A GAINST THE ORDER DATED 5.6.2016 PASSED BY THE LD. CIT(A)-2 9, NEW DELHI FOR ASSESSMENT YEAR 2010-11. 2. BRIEF FACTS OF THE CASE ARE THAT THE RETURN DECL ARING TOTAL INCOME OF RS.46,77,627/- WAS FILED. THE CASE OF TH E ASSESSEE WAS TAKEN UP FOR SCRUTINY AND THE ASSESSMENT WAS COMPLE TED AT AN INCOME OF RS. 4,84,21,493/- AFTER MAKING CERTAIN AD DITIONS WHICH INCLUDED AN AMOUNT OF RS.3,17,12,394/- ON ACCOUNT O F ITA NO. 5860/DEL/2015 ASSESSMENT YEAR 2010-11 2 UNCONFIRMED TRADE CREDITORS. THE ASSESSEE TOOK THE MATTER TO THE LD. CIT(A) WHO DELETED AN ADDITION OF RS. 2,88,46,5 90/- AND SUSTAINED THE ADDITION OF RS. 28,65,804/-. THE DEP ARTMENT IS IN APPEAL AGAINST THE DELETION BY THE LD. CIT (A) AND HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- 1. THE CIT(A) HAS ERRED IN THE EYES OF LAW IN DELE TING THE ADDITION AMOUNTING TO RS. 2,88,46,590/- ON ACCO UNT OF DISALLOWANCE OF TRADE CREDITORS WITHOUT SEEKING CONFIRMATION FROM THE CREDITORS AS WELL AS THE COMM ENTS OF THE ASSESSING OFFICER IN THIS REGARD. 2. THE CIT(A) HAS DELETED THE ADDITION ONLY ON TH E BASIS THAT THESE PARTIES WERE REGULAR PARTIES OF THE ASSE SSEE AND HE HAD CONTINUOUS DEALINGS FOR PURCHASES AND PAYMENTS MADE TO THEM. 3. THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AMEN D ANY/ALL OF THE GROUNDS OF APPEAL BEFORE OR DURING T HE COURSE OF THE HEARING OF THE APPEAL. 3. NONE WAS PRESENT ON BEHALF OF THE ASSESSEE/RESPO NDENT. HOWEVER, LOOKING INTO THE FACTS OF THE CASE, WE ARE PROCEEDING TO HEAR THE APPEAL EX PARTE QUA THE ASSESSEE. 4. THE LD. SR. DR SUBMITTED THAT THE DELETION IN RE SPECT OF SUNDRY CREDITORS HAD BEEN WRONGLY BEEN BY THE LD. CI T (A) WITHOUT SEEKING ANY CONFIRMATION FROM THE CREDITORS . LD. SR. DR ALSO SUBMITTED THAT THE ASSESSING OFFICER HAD ALSO REQUIRED THE ASSESSEE TO PROVIDE CONFIRMATIONS FROM THE TRADE CR EDITORS AND THE ADDITIONS HAD TO BE MADE BECAUSE THE ASSESSEE H AD FAILED TO ITA NO. 5860/DEL/2015 ASSESSMENT YEAR 2010-11 3 OBTAIN AND FILE THE CONFIRMATIONS FROM THE CREDITOR S. IT WAS ALSO SUBMITTED THAT THE LD. CIT (A) HAD DELETED THE ADDI TION WITHOUT GIVING ANY OPPORTUNITY TO THE ASSESSING OFFICER TO COUNTER THE CLAIM OF THE ASSESSEE DURING THE FIRST APPELLATE PR OCEEDINGS. 5. WE HAVE HEARD THE LD. SR. DR AND HAVE ALSO PERUS ED THE MATERIAL ON RECORD. A PERUSAL OF THE IMPUGNED ORDE R SHOWS THAT THE LD. CIT (A) HAD DELETED THE ADDITIONS IN RESPEC T OF CREDIT BALANCES IN RESPECT OF M/S SAGIR DAIRY, M/S RAM PAL DAIRY, M/S ABLOO DAIRY, M/S BAHADUR DAIRY, M/S MATADIN PLASTIC AND M/S SHUBI INTERNATIONAL ON THE GROUND THAT THE ASSESSEE HAD CONTINUOUS DEALING WITH RESPECT TO PURCHASES WITH T HESE SIX PARTIES. THE LD. CIT (A) HAS ALSO NOTED THAT THE P AYMENTS HAD BEEN MADE TO THESE SIX PARTIES IN THE SUBSEQUENT AS SESSMENT YEAR I.E. ASSESSMENT YEAR 2011-12 ALSO AND FURTHER THAT THE ASSESSMENT FOR ASSESSMENT YEAR 2011-12 WAS COMPLETE D U/S 143(3) OF THE ACT. THUS, ADDITION HAS BEEN DELETED ON THE GROUND THAT THE ASSESSEE HAD A RUNNING ACCOUNT WITH ALL TH ESE SIX PARTIES. IT IS FURTHER SEEN THAT THE LD. CIT (A) H AS SUSTAINED ADDITIONS IN RESPECT OF M/S JYOTI METAL (INDIA), M/ S STEAM RADIATORS CORP, M/S COMMITTED CARGO CARE P. LTD., M /S NOVA HOME APPLIANCES P. LTD. AND M/S CHETRA TRADING LLC ON THE ITA NO. 5860/DEL/2015 ASSESSMENT YEAR 2010-11 4 GROUND THAT NO CONFIRMATIONS WERE MADE AVAILABLE FR OM THESE PARTIES EITHER DURING THE COURSE OF ASSESSMENT PROC EEDINGS OR THE FIRST APPELLATE PROCEEDINGS. THE LD. CIT (A) HAS A LSO SUSTAINED ADDITION OF RS. 6,37,733/- IN RESPECT OF THE REMAIN ING CREDITORS WHEREIN NO DETAILS WERE AVAILABLE. THUS, IT IS VER Y MUCH EVIDENT THAT THE LD. CIT (A) HAS APPLIED HIS MIND TO REACH A LOGICAL CONCLUSION. THE FINDING THAT THE SIX PARTIES, IN RE SPECT OF WHOM THE ADDITION HAS BEEN DELETED BY THE LD.CIT (A), WE RE HAVING A RUNNING ACCOUNT WITH THE ASSESSEE HAS BEEN RECORDED BY THE LD. CIT (A) AFTER EXAMINATION OF THE ACCOUNTS OF THE AS SESSEE AND THIS FACTUAL FINDING OF THE LD. CIT (A) COULD NOT BE ASS AILED BY THE DEPARTMENT EVEN BEFORE US BY BRINGING ON RECORD ANY EVIDENCE TO THE CONTRARY. AS FAR AS THE DEPARTMENTS CONTENTION OF THE ASSESSING OFFICER NOT HAVING BEEN GIVEN ANY OPPORTU NITY TO COUNTERACT THE CLAIM OF THE ASSESSEE IS CONCERNED, IT IS SEEN THAT THE LD. CIT(A) HAS NOT TAKEN ANY FRESH EVIDENCE INT O CONSIDERATION WHICH WOULD NOT HAVE BEEN AVAILABLE W ITH THE ASSESSING OFFICER WHILE DELETING THE IMPUGNED ADDIT ION AND, THEREFORE, THE POWER OF THE LD. CIT(A) BEING CO-TER MINUS WITH THAT OF THE ASSESSING OFFICER, WE ARE OF THE CONSIDERED OPINION THAT THE LD. CIT(A) WAS WITHIN HIS RIGHTS TO HAVE ALLOWED RE LIEF TO THE ITA NO. 5860/DEL/2015 ASSESSMENT YEAR 2010-11 5 ASSESSEE BASED UPON THE ASSESSMENT PROCEEDINGS IN T HE SUBSEQUENT ASSESSMENT YEAR. THUS WE FIND NO FLAW I N THE APPROACH OF THE LD. CIT (A) IN HOLDING THAT SINCE T HE SIX ACCOUNTS WERE HAVING REGULAR DEALING WITH THE ASSESSEE, THE BALANCES COULD BE TAKEN AS GENUINE EVEN IN THE ABSENCE OF CONFIRMA TIONS FROM THE SAID SIX PARTIES. ACCORDINGLY, WE FIND NO REAS ON TO INTERFERE WITH THE FINDINGS OF THE LD. CIT (A) AND WE DISMISS THE GROUNDS RAISED BY THE DEPARTMENT. 6. IN THE RESULT, THE APPEAL OF THE DEPARTMENT STAN DS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 25 TH JANUARY, 2018. SD/- SD/- (B.P. JAIN) (SUDHANSHU SRIVASTAVA) ACCOUNTANT MEMBER JUDICI AL MEMBER DATED: 25 TH JANUARY, 2018 GS COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 4. DR, ITAT BY ORDER ASSTT. REGISTRAR