Sarvmangal Holy Store Pvt. Ltd., New Delhi V. ITO, Ward- 22(3), New Delhi

ITA 6395/DEL/2017

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 7872 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 10 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-08-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2014-2015
• Appeal Filed On: 18-10-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SARAS KUMAR
• Assessee Lawyers: SHAFIQ KHAN

Judgement Text

1 ITA NO. 6395/DEL/2017 IN THE INCOME TAX APPELLAT E TRIBUNAL DELHI BENCH: G NEW DELHI BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBE R AND MS SUCHITRA KAMBLE, JUDIC IAL MEMBER ITA NO. 6395 /DEL/2017 ( A.Y 2014-15) (THROUGH VIDEO CONFEREN CING) SARVMANGAL HOLY STORE PVT. LTD. HOUSE NO. 163, 2 ND FLOOR, PRITAMPURA VILLAGE, NEW DELHI-110034 PAN: AALCS4174R (APPELLANT) VS ITO WARD-22(3) NEW DELHI (RESPONDENT) APPELLANT BY SH. SHAFIQ KHAN, ADV RESPONDENT BY SH. SARAS KUMAR, SR. DR ORDER PER SUCHITRA KAMBLE, JM THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER DATED 25/08/2017 PASSED BY CIT(A)-28, NEW DELHI FOR ASSESSMENT YEAR 2014-15. 2. THE GROUNDS OF APPEAL ARE AS UNDER:- 1. THAT THE LD. CIT (APPEAL)-28, NEW DELHI HAS FAILED TO APPRAISE/EVALUATE THE FACTS AND CIRCUMSTANCES OF THE CASE AS HE COMPL ETELY MISCONSTRUED IN UPHOLDING THE FANCIFUL AND ARBITRARY ADDITIONS MADE BY THE LD. ASSESSING OFFICER, WARD 22(3), NEW DELHI OF RS . 85, 54, 472/ -BY TREATING /ASSUMING BOGUS COMMISSIONS PAID TO DIFFERENT ONLINE VENDORS AND RS.1, 08, 39000/- BY SUSPECTING THE GENUINENESS OF PURCHASE AND THUS MAKING AD-HOC ADDITION 025% OF TOTAL PURCHASES. DATE OF HEARING 26.08.2020 DATE OF PRONOUNCEMENT 27.08.2020 2 ITA NO. 6395/DEL/2017 2. THAT THE ILLEGAL AND ARBITRARY ADDITIONS OF RS.85, 54,472/-BY TREATING/ASSUMING BOGUS COMMISSIONS PAID TO DIFFERE NT ONLINE VENDORS AND RS. 1,08,39000/- BY SUSPECTING THE GENUINENESS OF P URCHASE AND THUS MAKING AD-HOC ADDITION 025% OF TOTAL PURCHASES ARE ILLEGAL AND UNSUSTAINABLE ,AS THE APPELLANT COMPANY HAS ALL THE SUPPORTING DO CUMENTS/EVIDENCE TO ESTABLISH THEIR CLAIM WHICH WERE PROVIDED BOTH AT T HE TIME OF ASSESSMENT PROCEEDINGS AND APPELLATE PROCEEDINGS AND WHICH WER E UNJUSTIFIABLY DENIED/NOT ACCREDITED BY BOTH THE ASSESSING OFFICER AND APPELLATE AUTHORITY. 3. THAT THE LD. ASSESSING OFFICER ,WARD 28(3), NEW DI D NOT PROVIDE/CONFER FAIR AND ADEQUATE OPPORTUNITY TO REPRESENT THE CASE AND ADOPTED BIASED AND ARBITRARY APPROACH IN MAKING WHIMSICAL AND ILLEGAL ADDITIONS OF RS.1, 93, 93, 472/-TO WHICH THE LD. CIT(APPEAL)-28, NEW DELHI UPH ELD AND APPROVED WITHOUT ACTING JUDICIOUSLY AND REALISTICALLY. 4. THAT THE EXORBITANT ADDITIONS HAS CAUSED UNDUE FIN ANCIAL BURDEN ON THE ASSESSEE DESPITE THE FACTS THAT HAD SATISFACTORILY PLACED ALL THE EVIDENCE AND RECORD BEFORE THE CONCERNED ASSESSING OFFICER AND A PPELLATE LD. COMMISSIONER OF INCOME TAX(APPEAL)28, NEW DELHI. 5. THAT ANY OTHER GROUND WHICH MAY BE RAISED WITH THE PERMISSION OF THIS HON'BLE COURT. 3. THE ASSESSEE COMPANY IS ENGAGED IN THE BUSINESS OF TRADING HOMES AND KITCHEN ITEMS AS WHOLESALERS & RETAILERS. THE AS SESSEE FILED RETURN OF INCOME ON 30/11/2014 DECLARING AN INCOME OF RS. 3,3 6,020/-. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER OBSER VED THAT THE ASSESSEE PAID COMMISSION OF RS. 85,54,447/- AND CLAIMED AS EXPEND ITURE IN PROFIT AND LOSS. THE ASSESSING OFFICER ASKED THE ASSESSEE TO FILE TH E DETAILS ALONG WITH JUSTIFICATION AND GENUINENESS OF EXPENSES. HOWEVER , THE ASSESSEE DID NOT FILE ANY DETAILS REGARDING COMMISSION PAID. CONSEQUENTL Y, ASSESSING OFFICER DISALLOWED THE COMMISSION EXPENSES AS BOGUS EXPENSE S. SIMILARLY, IN RESPECT OF PURCHASES, ASSESSING OFFICER ASKED THE ASSESSEE TO PRODUCE THE PURCHASE BILLS ALONG WITH BOOKS OF ACCOUNTS. AGAIN THE ASSE SSEE FAILED TO PRODUCE THE 3 ITA NO. 6395/DEL/2017 PURCHASE BILL IN SUPPORT OF PURCHASES MADE BY HIM D URING THE YEAR UNDER CONSIDERATION. THE ASSESSING OFFICER DISALLOWED 25 % OF TOTAL PURCHASES AMOUNTING TO RS.1,08,39,000/- AND ADDED BACK TO THE INCOME OF THE ASSESSEE. 4. BEING AGGRIEVED BY THE ASSESSMENT ORDER, THE ASS ESSEE FILED APPEAL BEFORE THE CIT(A). THE CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE. 5. THE LD. AR SUBMITTED THAT DUE TO UNAVOIDABLE CIR CUMSTANCES, THE ASSESSEE COULD NOT FILE DETAILS BEFORE THE ASSESSIN G OFFICER AND THE ASSESSING OFFICER ALSO HAS NOT GIVEN SUFFICIENT TIME TO THE A SSESSEE TO SUBMIT THE DETAILS. THE CIT(A) THOUGH OBSERVED THAT THE PART DETAILS WE RE FILED BUT FAILED TO LOOK INTO THE DETAILS AND WITHOUT DISCUSSING THE DETAILS SIMPLICITOR DISMISSED THE APPEAL OF THE ASSESSEE. THEREFORE, THE LD. AR PRAY ED THAT THE MATTER MAY BE REMANDED BACK TO THE FILE OF THE ASSESSING OFFICER FOR VERIFICATION OF ALL THE EVIDENCES/DOCUMENTS IN SUPPORT OF THE ASSESSEES CL AIM. 6. THE LD. DR RELIED UPON THE ASSESSMENT ORDER AND THE ORDER OF THE CIT(A). 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. FROM THE PERUSAL OF THE ASSESSMENT ORDER A ND THE ORDER OF THE CIT(A) THE DETAILED DISCUSSION ON MERIT HAS NOT BEEN DONE BY EITHER OF THE REVENUE AUTHORITIES. DESPITE MENTIONING THAT DETAILS WERE FILED BEFORE THE CIT(A), THE CIT(A) HAS NOT LOOKED INTO THOSE DETAILS AS WELL AS HAS NOT CALLED FOR ANY REMAND REPORT REGARDING THESE DETAILS FROM THE ASSE SSING OFFICER. THEREFORE, IT WILL BE APPROPRIATE TO REMAND BACK THIS MATTER TO T HE FILE OF THE ASSESSING OFFICER FOR PROPER VERIFICATION AND ADJUDICATION OF THE DOCUMENTS/EVIDENCES AND THEREAFTER ARRIVE AT A PROPER CONCLUSION. NEEDLESS TO SAY, THE ASSESSEE BE GIVEN OPPORTUNITY OF HEARING BY FOLLOWING PRINCIPLES OF N ATURAL JUSTICE. THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. 4 ITA NO. 6395/DEL/2017 8. IN RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 27 TH DAY OF AUGUST, 2020 . SD/- SD/- (R. K. PANDA) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL M EMBER DATED: 27/08/2020 R. NAHEED COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI