Income Tax Officer, GONDA V. M/s Suraj Udyog, GONDA

ITA 635/LKW/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 100311 (ITAT-LUCKNOW)
• Duration Of Justice: 1 year(s) 11 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-08-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 10-07-2015
• Assessment Year: 2011-2012
• Appeal Filed On: 16-08-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: NIDHI VERMA
• Assessee Lawyers: A P SINHA
• Keywords: Unexplained cash credit; Rejection of books of accounts; Opportunity of being heard
• Section: 145

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI. A. K. GARODIA, ACCOUNTANT MEMBER ITA NO.635/LKW/2013 ASSESSMENT YEAR:2011-12 INCOME TAX OFFICER GONDA V. M/S SURAJ UDYOG DADUA BAZAR BARGAON, GONDA TAN/PAN:ABLFS6863K (APPELLANT) (RESPONDENT) APPELLANT BY: SMT. NIDHI VERMA, D.R. RESPONDENT BY: SHRI. A. P. SINHA, ADVOCATE DATE OF HEARING: 10 07 2015 DATE OF PRONOUNCEMENT: 05 08 2015 O R D E R PER SUNIL KUMAR YADAV: THIS APPEAL IS PREFERRED BY THE REVENUE AGAINST THE ORDER OF THE LD. CIT(A), INTER ALIA, ON THE FOLLOWING GROUNDS:- 1. THAT THE ID. CIT(A)-II, LUCKNOW HAS ERRED ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW BY OBSERVING IN PARA 4(5) OF THE APPELLATE ORDER THAT THE AO IS JUSTIFIED IN REJECTING THE BOOKS OF ACCOUNTS BY TAKING RECOURSE TO PROVISIONS CONTAINED IN SECTION 145 OF THE ACT. LD. CIT(A)-II, LUCKNOW WAS ERRONEOUS ON FACTS AS THE AO IN HIS ASSESSMENT ORDER HAS NOWHERE REJECTED THE BOOKS OF ACCOUNTS, ONLY THE DOCUMENTS PRODUCED BY THE ASSESSEE IN SUPPORT OF VARIOUS CLAIMS RAISED WERE NOT FOUND GENUINE, HENCE REJECTED. 2. THAT WITHOUT PREJUDICE TO THE ABOVE, THE ID. CIT(A)-II, LUCKNOW HAS ERRED ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW BY DELETING THE ADDITION OF RS. 15,30,270/- ON ACCOUNT OF SUNDRY CREDITORS WHEN THE ASSESSEE DURING THE COURSE OF ASSESSMENT :- 2 -: PROCEEDINGS COULD NOT PROVE THE IDENTITY, CREDITWORTHINESS OF THE SUNDRY CREDITORS. 3. THAT THE ID. CIT(A)-II, LUCKNOW HAS ERRED ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW BY ALLOWING RELIEF COMPLETELY IGNORING THE FACT THAT THE CBI'S SEARCH IN ASSESSEE'S PREMISES WAS IN CONNECTION WITH INVESTIGATIONS RELATING TO DIVERSION AND ILLEGAL SALE OF FOODGRAINS MEANT FOR DISTRIBUTION UNDER VARIOUS SCHEMES TO POOR/PUBLIC DISTRIBUTION SYSTEM ETC. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE COULD NOT IDENTIFY THE PARTIES FROM WHOM FOODGRAINS WERE PURCHASED. MANDATORY 6R RECEIPTS NECESSARY FOR PURCHASE OF FOODGRAINS FROM FARMERS ETC. ARE ALSO NOT POSSESSED BY THE ASSESSEE. ALL THESE MATERIAL LEADS TO STRENGTHEN THE SUSPICION THAT THE ASSESSEE ILLEGALLY PURCHASED FOODGRAINS (BELONGING TO VARIOUS SCHEMES FOR POOR/PUBLIC DISTRIBUTION SYSTEM ETC.) FROM UNKNOWN SOURCES (UNDER INVESTIGATION BY CBI). PRIMA FACIE THE CASES RELIED BY THE !D. CIT(A)-II, LUCKNOW ARE NOT COMPARABLE AND THEY PERTAIN TO NORMAL BUSINESS CONDITIONS WHEN THE ASSESSEE HAS EARNED EXTRA PROFIT MARGIN BY ADOPTING AND USING UNFAIR AND ILLEGAL BUSINESS PRACTICES. 4. THAT THE ID. CIT(A)-II, LUCKNOW HAS ERRED ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW WHILE ACCEPTING FRESH EVIDENCES/CLAIMS IN APPELLATE PROCEEDINGS BY THE RESPONDENT BEFORE CALLING FOR A REMAND REPORT FROM THE A.O., WHICH WAS BINDING UPON HIM UNDER RULE 46A.OF THE INCOME TAX RULES, 1962. 5. THAT THE ORDER DATED: 14.06.2013 PASSED BY THE ID. CIT(A) IN APPEAL NO. 39/134/TTO/GONDA/12-13 RELATING TO ASSESSMENT YEAR 2011-12 BEING ERRONEOUS IN LAW AND ON FACTS DESERVES TO BE CANCELLED AND THE ORDER OF THE A.O. DESERVES TO BE RESTORED. 2. DURING THE COURSE OF HEARING, THE LD. D.R. HAS INVITED OUR ATTENTION THAT THE ASSESSING OFFICER HAS MADE AN ADDITION OF RS.15,30,270/- ON ACCOUNT OF UNEXPLAINED CREDITORS WHICH WAS CHALLENGED BEFORE THE LD. CIT(A) AND THE LD. CIT(A) HAS NOT ADJUDICATED THIS ISSUE IN HIS APPEAL, BUT DELETED THE ADDITION IN THE LAST PARAGRAPH OF HIS ORDER. SINCE THE LD. CIT(A) :- 3 -: HAS NOT GIVEN ANY SPECIFIC FINDING ON THIS ISSUE WHILE DELETING THE ADDITION, THE MATTER MAY BE RESTORED BACK TO HIS FILE FOR ADJUDICATION OF THE ISSUE ON MERIT BY PASSING A SPEAKING ORDER. 3. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, HAS PLACED RELIANCE UPON THE ORDER OF THE LD. CIT(A). 4. HAVING CAREFULLY EXAMINED THE ORDERS OF THE LOWER AUTHORITIES IN THE LIGHT OF THE RIVAL SUBMISSIONS, WE FIND THAT THE ASSESSING OFFICER HAS MADE ADDITION OF RS.15,30,270/- ON ACCOUNT OF UNEXPLAINED SUNDRY CREDITORS, BUT THIS ISSUE WAS NOT EXAMINED BY THE LD. CIT(A) IN HIS ORDER. HE, HOWEVER, DELETED THE ADDITION IN ONE LINE IN LAST PARAGRAPH OF HIS ORDER. THEREFORE, IT APPEARS THAT THE LD. CIT(A) HAS NOT APPLIED HIS MIND TO THIS ISSUE. ACCORDINGLY, WE SET ASIDE THE ORDER OF THE LD. CIT(A) AND RESTORE THE MATTER TO HIS FILE WITH A DIRECTION TO RE-ADJUDICATE THE ISSUE AFRESH AFTER AFFORDING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 5. IN THE RESULT, APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTIONED PAGE. SD/- SD/- [A. K. GARODIA] [SUNIL KUMAR YADAV] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 5 TH AUGUST, 2015 JJ:3007 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR ASSISTANT REGISTRAR