INDUSTRIAL THERMOPLASTICS ( PACKAGING DIVISON), MUMBAI V. ITO 20(1)(3), MUMBAI

ITA 6152/MUM/2009

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 7799 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-03-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Next Hearing Date: 25-10-2010
• Assessment Year: 2004-2005
• Appeal Filed On: 25-11-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K SINGH
• Assessee Lawyers: B V JHAVERI
• Keywords: Assessment record

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI I BENCH BEFORE SHRI R.V.EASWAR (PRESIDENT) & SHRI T.R.SOOD, ACCOUNTANT MEMBER I.T.A.NO.6152/MUM/2009 A.Y 2004-05 INDUSTRIAL THERMOPLASTICS (PACKAGING DIVISION), A 47, NANDKISHORE INDUSTRIAL ESTATE, MAHAKALI CAVES R&D., ANDHERI (E), MUMBAI 400 093 PAN: AAAF; 0341 Q VS. INCOME TAX OFFICER 20 (1)(3), MUMBAI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI B. V. JHAVERI. RESPONDENT BY : MR. S.K.SINGH. O R D E R PER T.R.SOOD, AM: IN THIS APPEAL VARIOUS GROUNDS HAVE BEEN RAISED, B UT THE ONLY DISPUTE INVOLVED IS REGARDING ADMISSION OF ADDITION AL EVIDENCE IN THE SHAPE OF RECONCILIATION IN RESPECT OF PURCHASE AND SALE TRANSACTIONS. 2. AFTER HEARING BOTH THE PARTIES, WE FIND THAT THE PROFIT OF THE ASSESSEE FIRM WAS ESTIMATED BY THE ASSESSING OFFICE R BY REJECTING THE BOOKS OF ACCOUNTS BECAUSE [I] THERE WAS SUBSTANTIAL FALL IN NET PROFIT, [II] PRODUCTION LOSS @ 19.17%, [III]NO EVIDENCE IN RESPECT OF VALUATION OF CLOSING STOCK, [IV] NON FILING OF RECONCILIATION IN RESPECT OF DIFFERENCE IN PURCHASE AND SALE TRANSACTIONS SHOWN BY THE ASSE SSEE IN COMPARISON TO REPLY RECEIVED IN RESPONSE TO NOTICE U/S.133{6} AND [V] NON UTILISED MODVAT CREDIT. 2 3. DURING REMAND PROCEEDINGS, AS POINTED OUT BY THE LD. COUNSEL OF THE ASSESSEE ALL OTHER DISCREPANCIES HAVE BEEN A CCEPTED BY THE AO AND IN THIS REGARD HE MADE REFERENCE TO PAGE-O OF T HE PAPER BOOK EXCEPT REGARDING RECONCILIATION IN RESPECT OF DIFFE RENCE IN PURCHASE AND SALES. 4. THE RECONCILIATION WAS FILED BEFORE THE CIT[A] B UT SAME WAS REJECTED BECAUSE, ACCORDING TO THE LD. CIT[A], ASSE SSEE HAD ALREADY BEEN GIVEN OPPORTUNITY TO PRODUCE THIS EVIDENCE, BU T DESPITE OF THAT, NOTHING WAS PRODUCED. 5. BEFORE US, IT WAS MAINLY SUBMITTED THAT AO HAD W RITTEN CERTAIN LETTERS TO VERIFY THE TRANSACTION OF SALES AND PURC HASES AND ALL THE PARTIES HAD RESPONDED ACCEPTING THE TRANSACTIONS. H OWEVER, THERE WERE SOME DIFFERENCES ON ACCOUNT OF VARIOUS DEBIT/CREDIT NOTES NOT ACCOUNTED BY EITHER ASSESSEE OR OTHER PARTIES. IT W AS POINTED OUT THAT THIS EVIDENCE WAS ASKED FOR THE FIRST TIME ONLY ON 27-12-2006 AND EVEN ASSESSMENT ORDER WAS ALSO PASSED ON THE SAME DATE. IT WAS FURTHER POINTED OUT THAT LD. CIT[A] HAS NOT APPRECIATED THE FACT THAT IN THE ORDER SHEET FOR ASSESSMENT PROCEEDINGS ON 20-7-2006 ORIGINALLY NO SUCH REQUEST FOR FURNISHING OF RECONCILIATION WAS M ADE AND THAT THIS REQUIREMENT WAS INSERTED LATER ON. HE ALSO SUBMITTE D THAT IN ANY CASE CIT[A] HAS CO-TERMINUS POWERS AND, THEREFORE, HE SH OULD HAVE ACCEPTED THIS RECONCILIATION. THEREFORE, IN THE INT ERESTS OF JUSTICE, THIS RECONCILIATION SHOULD BE ACCEPTED AND MATTER MAY BE REMANDED TO THE FILE OF THE AO. 3 6. ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENTATI VE, PRODUCED THE ORIGINAL ASSESSMENT RECORDS AND POINTED OUT THA T ASSESSEE WAS DULY ASKED ON 20-7-2006 TO PRODUCE THE RECONCILIATI ON AND, THEREFORE, ASSESSEE CANNOT LATER ON SAY THAT NO OPPORTUNITY WA S GIVEN. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFUL LY. WE HAVE ALSO EXAMINED THE ORDER SHEET OF THE PROCEEDINGS BY THE ASSESSING OFFICER AND IT SEEMS, APPARENTLY, THAT REQUIREMENT OF FILING OF RECONCILIATION REGARDING PURCHASES AND SALES HAS BE EN INSERTED LATER ON. IN ANY CASE, NO HARM WOULD BE CAUSED TO THE REV ENUE IF THE ISSUE IS DECIDED AFTER CONSIDERING THE RECONCILIATION FIL ED BY THE ASSESSEE. THEREFORE, WE SET ASIDE THE ORDER OF THE LD. CIT[A] AND REMIT THE MATTER BACK TO THE FILE OF THE AO WITH A DIRECTION TO ADMIT THE RECONCILIATION FILED BY THE ASSESSEE AND THEN DECID E THE ISSUE IN ACCORDANCE WITH LAW. 8. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY OF 2 8 TH DAY OF MARCH, 2011. SD/- SD/- (R.V.EASWAR) (T.R.SOOD) PRESIDENT ACCOUNTANT MEMBER MUMBAI: 28 TH MARCH, 2011. P/-* 4