Shri Ganesh Marbles, Palanpur V. The Income tax Officer,Ward-1, Palanpur

ITA 609/AHD/2011

• Counselvise Citation: 60920514 RSA 2011
• Duration Of Justice: 5 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-08-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 25-02-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VINOD TANWANI
• Assessee Lawyers: SAKAR SHARMA
• Keywords: Revised return
• Section: 68; 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL : SMC BENCH : AHMEDABAD (BEFORE HONBLE SHRI T.K. SHARMA, J.M .) I.T.A. NO. 609/AHD./2011 ASSESSMENT YEAR : 2007-2008 SHRI GANESH MARBLES, PALANPUR -VS- ITO, WARD-1, PALANPUR (PAN : AATFS 0234M) (APPELLANT) (RESPONDEN T) APPELLANT BY : SHRI SAKAR SHARMA, A. R. RESPONDENT BY : SHRI VINOD TANWANI, SR. D.R. DATE OF HEARING : 17.08.2011 DATE OF PRONOUNCEMENT : 19.08.2011 O R D E R THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE O RDER DATED 25.11.2010 PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-XX , AHMEDABAD CONFIRMING THE ADDITION OF RS.1,94,400/- WHICH WAS MADE BY THE AO BY INVOKING PROVISIONS OF SECTION 68 OF THE I.T. ACT, 1961 FOR THE ASSESSMENT YEAR 20 07-2008. 2. BRIEFLY STATED, THE FACTS ARE THAT THE ASSESSEE IS A PARTNERSHIP FIRM CARRYING OUT THE RETAIL BUSINESS OF MARBLE TRADING AT PALANPUR. FOR THE ASSESSMENT YEAR UNDER APPEAL, IT FILED THE RETURN OF INCOME DECLARING TOTAL INCOME A T RS.NIL. THE AO FRAMED THE ASSESSMENT UNDER SECTION 143(3) ON 16.11.2009 WHERE IN HE ADDED TO THE TOTAL INCOME OF THE ASSESSEE RS.1,94,400/- BEING CASH CREDIT UNDER SECTION 68 OF THE I.T. ACT, 1961. THIS ADDITION WAS MADE ON THE GROUND THAT THE SCHEDULE O F BALANCE-SHEET SHOWS THE ENTRY OF RS.1,94,000/- AS UNSECURED LOAN WHEREAS THE CONFIRM ATION FILED AS ADVANCE AGAINST GOODS. IN THE ASSESSMENT ORDER, THE AO ALSO STATED THAT TH E ASSESSEE FILED THE REVISED RETURN OF 2 ITA NO. 609-AHD-2011 INCOME ON 31.03.2009 WHEREIN THE ABOVE DEPOSITS WER E SHOWN AS ADVANCE FOR GOODS. THIS RETURN OF INCOME UNDER SECTION 139(1) OF THE A CT WAS NOT VALID. IF THE ASSESSEE WANTS TO CLAIM DEPOSITS AS ADVANCE FOR GOODS, THE ASSESSE E FIRM SHOULD HAVE FILED ITS REVISED RETURN OF INCOME ON OR BEFORE 30.09.2008. ON THIS B ASIS, HE HELD THAT REVISED RETURN FILED ON 31.03.2009 CANNOT BE ACCEPTED UNDER SECTION 139( 5) OF THE ACT. 3. ON APPEAL BEFORE THE LD. CIT(A), THE ASSESSEE FI LED A DETAILED REPLY, WHICH IS REPRODUCED BY THE LD. CIT(A) IN PARA 3.2 OF THE IMP UGNED ORDER. IN THIS REPLY, IT WAS CONTENDED THAT IN THE BALANCE-SHEET, THERE WAS MIST AKE IN GROUPING WHICH WAS CORRECTED. WITH REGARD TO THE OBSERVATION OF THE AO THAT SALE BILLS OF THE ASSESSEE ARE BOGUS AND AFTER-THOUGHT, IT WAS CONTENDED THAT AFFIDAVIT FROM THE CUSTOMER IS ENCLOSED. THE ASSESSEE, IN ITS QUARTERLY VAT RETURN, HAS REFLECTED ALL THE BILLS. VAT IS CALCULATED AND PAID ACCORDINGLY BEFORE THE SCRUTINY ASSESSMENT UNDER TH E INCOME TAX ACT. THEREFORE, IT CANNOT BE SAID THAT IT IS AFTER-THOUGHT. WITH REGAR D TO THE OBSERVATION OF THE AO, IT WAS CONTENDED THAT IN A SMALL VILLAGE WHERE EACH AND EV ERY PERSON WAS KNOWN TO EACH OTHER AND HIS NAME AND VILLAGE NAME IS SUFFICIENT TO IDEN TIFY THE PERSON ALSO. THE AO, WITHOUT SENDING THE NOTICE TO ALL THE BUYERS, STATED THAT P OSTAL ADDRESS IS NOT PROVIDED. 3.1 AFTER CONSIDERING THE AFORESAID SUBMISSIONS, IN THE IMPUGNED ORDER, THE LD. CIT(A) CONFIRMED THE ADDITION ON THE GROUND THAT THE ASSES SEE DID NOT FILE THE COMPLETE ADDRESS OR ANY OTHER MATERIALS TO ESTABLISH THE IDENTITY OF THE CREDITORS. THE LD. CIT(A) ALSO RELIED ON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF CIT-VS- DURGA PRASAD MORE REPORTED IN 82 ITR 540 (SC) FOR THE PROPOSITION THA T SELF-SERVING AFFIDAVITS HAVE NO EVIDENTIAL VALUE. AGGRIEVED WITH THE ORDER OF THE L D. CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 4. AT THE TIME OF HEARING, ON BEHALF OF THE ASSESSE E, SHRI SAKAR SHARMA APPEARED AND FILED PAPER BOOK CONTAINING 13 PAGES, WHICH, INTER ALIA, INCLUDE COPY OF QUARTERLY VAT STATEMENTS, DULY SIGNED BY SALES TAX OFFICER(3), PA LANPUR PERTAINING TO THE SUBSEQUENT ASSESSMENT YEAR WHEREIN FIGURE OF VAT CALCULATION I S MENTIONED. IN THIS PAPER BOOK, 3 ITA NO. 609-AHD-2011 COPIES OF SALES INVOICES ISSUED TO THE PARTIES WHO HAD GIVEN ADVANCE AGAINST SUPPLY IN THE YEAR UNDER CONSIDERATION WERE ALSO FURNISHED. THE C OUNSEL OF THE ASSESSEE ALSO EXPLAINED THAT THESE DOCUMENTS WERE FILED BEFORE THE LD. CIT( A) WHO HAS REJECTED THE SAME ON DOUBTS AND SUSPICION. HE POINTED OUT THAT THESE DOC UMENTS CLEARLY PROVE THAT THERE WAS A BONA FIDE MISTAKE, WHICH WAS CORRECTED BY THE ASSESSEE. ACTU ALLY LOANS SHOWN WAS NOTHING BUT ADVANCES RECEIVED FROM THE CUSTOMERS WH ICH WERE ADJUSTED IN SALES BILLS ISSUED TO ALL THESE PARTIES. HE ACCORDINGLY CONTEND ED THAT ADDITION OF RS.1,94,400/- BE DELETED. 5. ON THE OTHER HAND, SHRI VINOD TANWANI, APPEARING ON BEHALF OF THE REVENUE, VEHEMENTLY SUPPORTED THE ORDER OF THE LD. CIT(A). T HE LD. D.R. POINTED OUT THAT REVISED RETURN FILED BY THE ASSESSEE IS RIGHTLY REJECTED AS IT WAS AFTER-THOUGHT. 6. HAVING HEARD BOTH THE SIDES, I HAVE CAREFULLY GO NE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. PRIMA FACIE , IT APPEARS THAT ORIGINALLY, THERE WAS A MISTAKE I N GROUPING. THIS HAS BEEN CORRECTED SUBSEQUENTLY. THE FACT THAT IT WAS A BONA FIDE MISTAKE WHICH IS CONCLUSIVELY PROVED BY COPIES OF QUARTERLY VAT STAT EMENTS AND SALES INVOICES ISSUED TO THE PARTIES WHO HAD GIVEN ADVANCES AGAINST SUPPLY I N THE ASSESSMENT YEAR UNDER CONSIDERATION. TO SUM UP, I AM CONVINCED THAT BOTH THE DEPARTMENTAL AUTHORITIES BELOW REJECTED THE EXPLANATION OF THE ASSESSEE ON DOUBTS AND SUSPICION. HENCE, THE CONFIRMATION OF ADDITION OF RS.1,94,400/- IS ALSO NOT JUSTIFIED. I, THEREFORE, DELETE THE ADDITION OF RS.1,94,400/- MADE BY THE AO AND CONFIRMED BY THE L D. CIT(A). RESULTANTLY, THE APPEAL OF THE ASSESSEE IS ALLOWED. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 19 .08.2011. SD/- (T.K. SHARMA) JUDICIAL MEMBER DATED : 19/08/2011 4 ITA NO. 609-AHD-2011 COPY OF THE ORDER IS FORWARDED TO : 1) THE ASSESSEE 2) THE DEPARTMENT. 3) CIT(A.) CONCERNED, 4) CIT CONCERNED, 5) D.R., ITAT, AHMEDABAD. TRUE COPY` BY ORDER DEPUTY REGISTRAR, ITAT, AHMEDABAD TALUKDAR/SR.P.S.