ITO, New Delhi V. M/s. K B Contract Pvt. Ltd., New Delhi

ITA 6478/DEL/2016

• Counselvise Citation: [2018] 123 COUNSELVISE.COM (IT) 8291 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 9 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-10-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2012-2013
• Appeal Filed On: 19-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: HIMANSHU GUPTA
• Keywords: Bogus purchase; Unexplained expenditure
• Section: 69C; 69

Judgement Text

PAGE | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D : NEW DELHI BEFORE SHRI AMIT SHUKLA , JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO. 6478/DEL/2016 (ASSESSMENT YEAR: 2012 - 13 ) ITO, WARD - 14(1), NEW DELHI VS. KB CONTRACT PVT. LTD, 311 - 312, JAINA TOWER - 2, DISTRICT CENTRE, JANAKPURI, NEW DELHI PAN: ADCK6091P (APPELLANT) (RESPONDENT) REVENUE BY : SHRI AMIT JAIN, SR. DR ASSESSEE BY: SHRI HIMANSHU GUPTA, CA DATE OF HEARING 25/07 / 2018 DATE OF PRONOUNCEMENT 0 3 / 10 / 2018 O R D E R PER PRASHANT MAHARISHI, A. M. 01. THIS APPEAL IS FILED BY THE LD INCOME TAX OFFICER, WARD 14 (1), AND NEW DELHI AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) V, NEW DELHI FOR ASSESSMENT YEAR 2012 13 IN CASE OF M/S K. B. CONTRACT (P) LIMITED. 02. THE ONLY GROUND OF APP EAL IS THAT THE LEARNED COMMISSIONER APPEAL HAS ERRED IN LAW IN DELETING THE ADDITION OF RS. 3198701/ AND 2360970/ ON ACCOUNT OF BOGUS PURCHASES UNDER SECTION 69C ON ACCOUNT OF SUBSTANTIATED CREDITORS RESPECTIVELY, WITHOUT ANY BASIS AND BY IGNORING T HE FACT THAT THE PARTIES HAVE PROVIDED ITO VS KB CONTRACT PVT. LTD ITA NO. 6478/DEL/2016 (ASSESSMENT YEAR: 2012 - 13) PAGE | 2 WRONG INFORMATION IN THE TIME OF ASSESSMENT. 03. FACTS ARE THAT ASSESSEE IS A COMPANY ENGAGED IN THE BUSINESS OF GOVERNMENT CONTRACTING OF EXTERNAL ELECTRIFICATION. IT FILED RETURN OF INCOME ON 7/3/2013 AT RS. 221450/ - . DURING ASSESSMENT, ASSESSEE WAS ASKED TO PRODUCE THE BILLS OF VARIOUS PARTIES. ASSESSEE SUBMITTED BILLS AND IT WAS NOTED THAT SOME BILLS OF GENERATOR DID NOT MATCH IN CASE OF ONE PARTY. THE PARTY SUBMITTED DIFFERENT BILL NOS WHERE S THE ASSESSEES BOOKS ALSO SHOWED THE DIFFERENT BILLS. THEREFORE, THE DL AO TREATED THE SAME AS UNACCOUNTED PURCHASES AND MADE AN ADDITION OF RS. 31,98701/ - ON ACCOUNT OF PURCHASES FROM ONLY ONE PARTY. FURTHER THE LEARNED AO ISSUED NOTICES UNDER SECTION 133 (6) OF THE ACT TO SI X PARTIES. IN RESPONSE TO THAT, INFORMATION WAS RECEIVED FROM FOUR SUPPLIERS. WITH RESPECT TO ONE SUPPLIER AMONGST THEM, THE DIFFERENCE IN THE BALANCE WAS RS 1094448/ - THEREFORE THE DL AO MADE THE ADDITION OF THAT SUM. WITH RESPECT TO OTHER TWO SUPPLIERS , AS NO INFORMATION IS RECEIVED THE LD AO MADE THE COMPLETE ADDITION OF BALANCES WITH RESPECT TO TWO CREDITORS. CONSEQUENTLY FURTHER ADDITION OF RS 2360970/ - WAS MADE U/S 69 OF THE ACT. THE ASSESSEE DID NOT FURNISH EXPLANATION AND AO TREATED 3198701 - AS UNEXPLAINED EXPENDITURE APPLYING ITO VS KB CONTRACT PVT. LTD ITA NO. 6478/DEL/2016 (ASSESSMENT YEAR: 2012 - 13) PAGE | 3 PROVISIONS OF SECTION 69C OF THE. ON RECEIPT OF INFORMATION FROM BUYERS IN CASE OF SUPPLIERS HE MADE ADDITION OF RS 2360970/ - . CONSEQUENTLY ASSESSMENT UNDER SECTION 143 (3) WAS PASSED ON 17/3/2015 AND DETERMINED TOTAL INCOME OF ASSESSEE OF RS. 5781121/ - AGAINST RETURNED INCOME OF RS 221450/ - . 04. THE ASSESSEE PREFERRED AN APPEAL BEFORE COMMISSIONER APPEAL WHO VIDE ORDER DATED 5/10/2016 DELETED THE ADDITION. THE LEARNED ASSESSING OFFICER AGGRIEVED BY THAT ORDER HAS PREFERRED AN APPEAL BEFORE US. 05. THE LD DEPARTMENTAL REPRESENTATIVE, SHRI AMIT JAIN VEHEMENTLY SUPPORTED ORDER OF THE LEARNED AO AND SUBMITTED THAT WHEN THE ASSESSEE COULD NOT RECONCILE THE DIFFERENCE BETWEEN BALANCES SHOWN BY THE ASSESSEE WITH BALANCE OF CREDITORS AND FURTHER NO INFORMATION IS RECEIVED FROM TWO CREDITORS U/S SECTION 133 (6) OF THE ACT BY LD AO, ASSESSEE DID NOT FURNISH ANY EXPLANATION, THERE IS NO ERROR IN ORDER OF THE LD AO. THE LEARNED CIT A DELETED THE ADDITION OF 3198701/ - ERRONEOU SLY. WITH RESPECT TO THE SECOND EDITION RELIED UPON THE ORDER OF THE LEARNED OFFICER AND STATED THAT WHEN THE DIFFERENCE BETWEEN THE BALANCE SHOWN BY ASSESSEE AND BALANCE SHOWN BY SUPPLIER IS FOUND WHICH REMAINED UNRECONCILED AND WHEN SUPPLIER INFO RMATION IS NOT RECEIVED ITO VS KB CONTRACT PVT. LTD ITA NO. 6478/DEL/2016 (ASSESSMENT YEAR: 2012 - 13) PAGE | 4 U/S 133 (6) BY THE LEARNED ASSESSING OFFICER, THE ADDITION IS CORRECTLY MADE. 06. THE D AR RELIED UP ON THE ORDERS OF THE CIT A AND SUBMITTED THAT THERE IS NO DIFFERENCE IN THE BALANCES OF SUPPLIERS AS PER BOOKS AND AS PER CONFIRMAT ION RECEIVED. HE READ OUT PARA NO THREE OF THE ORDER OF THE LD CIT A. 07. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTION AND ORDERS OF LOWER AUTHORITIES. THE COMMISSIONER A HAS DELETED THE ADDITION OF RS 3198701/ - WITH RESPECT TO SUDHIR GENSETS LIMITED AS THE LD AO ASKED THE DETAILS ABOUT THE TRANSACTION WITH THE ASSESSEE, THE SUPPLIER SUBMITTED THE INFORMATION ABOUT ANOTHER PARTY M/S K B CONTRACTOR WRONGLY. FURTHER INFORMATION WAS GIVEN BY THE ASSESSEE IN 154 PROCEEDINGS, WHICH WERE REJECTED BY THE LD AO . HENCE ADDITION ON INFORMATION RECEIVED WITH RESPECT TO THE SUPPLIER, THE DL CIT (A) DELETED THE ADDITION OF RS 3198701/ - . WITH RESPECT TO OTHER PARTIES SIMILAR MATTER EXISTED AND CONFIRMATION WAS RECEIVED SO THE LD CIT A DELETED THE ADDITION. THE FA CTS SUBMITTED IN PARA NO THREE OF THE ORDER WAS NOT CONTROVERTED BY THE LD DR. WITH RESPECT TO ONLY ON PARTY INFORMATION WAS NOT RECEIVED WHERE THE ADDITION WAS ONLY OF RS. 38930/ - WHICH HAS BEEN VERIFIED BY THE LD CIT (A) THAT IN ITO VS KB CONTRACT PVT. LTD ITA NO. 6478/DEL/2016 (ASSESSMENT YEAR: 2012 - 13) PAGE | 5 SUBSEQUENT PERIOD, THE PAYMENT HAS BEEN MADE BY ASSESSEE BY CHEQUE AND IT WAS CONFIRMED THROUGH THE BANK STATEMENT OF THE ASSESSEE AS STATED BY THE CIT A. SO THE WHOLE ADDITION WAS DELETED. THE DL DR ALSO COULD NOT SHOW THAT WHERE THE LD CIT A HAS GONE WRONG. WE HAVE ALSO CAREFU LLY SEEN THE REASON GIVEN BY THE DL CIT A IN PARA NO THREE OF HIS ORDER AND WE DO NOT FIND ANY INFIRMITY IN HIS ORDER. THEREFORE WE UPHOLD THE ORDER OF THE LD CIT A DELETING THE ABOVE ADDITION OF RS 3198701/ - AND RS 2360970/ - . THE SOLITARY GROUND OF AP PEAL OF LD AO IS DISMISSED. 08. ACCORDINGLY, APPEAL OF LD AO IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 0 3 / 10 / 2018 . - S D / - - S D / - ( AMIT SHUKLA ) (PRASHANT MAHARISHI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 0 3 / 10 / 2018 A K KEOT COPY FORWARDED TO 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI