Deputy Commissioner of Income-tax, V. Shri Ishwar Birbal Sharma, Pune

ITA 648/PUN/2015

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 9496 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 8 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-01-2018
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 16-01-2018
• Assessment Year: 2009-2010
• Appeal Filed On: 07-05-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Principle of natural justice; Additional evidence

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE . , , BEFORE SHRI D.KARUNAKARA RAO, AM AND SHRI VIKAS AWASTHY, JM . / ITA NO.648/PUN/2015 / ASSESSMENT YEAR : 2009-10 DCIT, CIRCLE-8, PUNE . /APPELLANT VS. SHRI ISHWAR BIRBAL SHARMA (PROP. M/S. EXPRESS CARGO CARRIERS), A-WING, SHOP NO.6/7, KAMALA CROSS ROAD, OPP. PCMC BUILDING, PIMPRI, PUNE 411 018 PAN : ALIPS7721B . / RESPONDENT ASSESSEE BY : SHRI KISHOR PHADKE REVENUE BY : SHRI AJAY MODI, JCIT / DATE OF HEARING : 16.01.2018 / DATE OF PRONOUNCEMENT: 17.01.2018 / ORDER PER D. KARUNAKARA RAO, AM : THIS APPEAL IS FILED BY THE REVENUE AGAINST THE ORDER OF CI T(A)-I, NASHIK DATED 27-02-2015 FOR THE A.Y.2009-10. 2. GROUNDS RAISED BY THE REVENUE READ AS UNDER : 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE C ASE, THE LD.CIT(A) WAS RIGHT IN ADMITTING THE ADDITIONAL EVI DENCES DESPITE THE OBJECTION OF THE AO RELATING TO ADDITION OFFERED VI DE HIS LETTER DATED 30- 09-2011 DURING THE COURSE OF ASSESSMENT PROCEEDINGS . 2. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CA SE, THE LD.CIT(A) WAS CORRECT IN ADMITTING THE CLAIM OF THE ASSESSEE THAT THE ADDITIONAL INCOME/RECEIPT OF RS.48,10,087/- OFFERED DURING THE ASSESSMENT FOR THE DIFFERENCE OF ITS DATA RELATING TO SUCH TRANSPORT/SALES RECEIPT AND RECEIPTS SHOWN IN THE B OOKS RELATED TO HIS BROTHERS WITHOUT RELEVANT AND COGENT EVIDENCES ? 3. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CA SE, THE LD.CIT(A) WAS CORRECT IN TREATING THE RECEIPTS APPE ARING ON THE PAN OF THE ASSESSEE TO BE RELATING TO OTHER PERSONS, EVEN WHEN SUCH A ITA NO.648/PUN/2015 ISHWAR BIRBAL SHARMA 2 CONTENTION WOULD REQUIRE EXISTENCE OF A PARTNERSHIP FIRM OR AOP OR AS THE CASE MAY BE AND THE ASSESSEE HAS NOT FURNISHED ANY SUCH EVIDENCE? 3. AT THE OUTSET, LD. DR FOR THE REVENUE BROUGHT OUR A TTENTION TO GROUND NO.1 OF THE APPEAL AND SUBMITTED THAT IT IS A CASE WHERE CIT(A) CALLED FOR A REMAND REPORT FROM THE AO BEFORE THE ADDITION AL EVIDENCES WERE ADMITTED AND RELIED UPON. THERE IS NO VIOLATION AS TH E CIT(A) HAS RIGHTLY GIVEN OPPORTUNITY TO THE AO. THEREFORE, THE ABOV E GROUND RAISED BY THE REVENUE MAY BE DISMISSED AS NOT PRESSED. 4. ON HEARING BOTH THE SIDES AND CONSIDERING THIS FACT, WE ARE OF THE OPINION THAT THE GROUND RAISED BY THE REVENUE IS UN SUSTAINABLE SINCE THERE IS NO VIOLATION TO THE SET PRINCIPLES OF NATURA L JUSTICE AS THE CIT(A) MET THE REQUIREMENT OF GRANTING OPPORTUNITY TO THE AO. ACCORDINGLY, GROUND NO.1 RAISED BY THE REVENUE IS DISMISSED. 5. GROUND NOS. 2 AND 3 RAISED BY THE REVENUE ARE INTER LINKED AND THE ISSUE EMANATING FROM THESE GROUNDS RELATES TO ADDIT ION OF RS.48,10,087/- AND UNFAVOURABLE DECISION OF THE CIT(A). 6. BACKGROUND FACTS OF THIS ISSUE ARE THAT THERE EXISTS DISCREPANCIES WITH REFERENCE TO THE RECEIPTS AS PER THE ITS DATA RELATING TO THE TRANSPORT/SALES RECEIPTS AND THE RECEIPTS SHOW N IN THE BOOKS OF ACCOUNT OF THE ASSESSEE. DURING THE ASSESSMENT PROCEE DINGS, THE AO GRANTED OPPORTUNITY TO THE ASSESSEE TO RECONCILE THE D IFFERENCES BETWEEN THE ITS DATA AND THE ENTRIES IN THE BOOKS OF A CCOUNT. IN RESPONSE, ASSESSEE FILED WRITTEN SUBMISSIONS GIVING DETAILED EXPLANATION. UNSATISFIED WITH THE SAID EXPLANATION, AO PROCEE DED TO MAKE ADDITION OF THE SAID AMOUNT ON THIS ACCOUNT. CONTEN TS OF PARA NO.4 CONSTITUTES OPERATIONAL PARA AND THE SAME IS EXTRACTED AS UND ER : ITA NO.648/PUN/2015 ISHWAR BIRBAL SHARMA 3 4. ON GOING THROUGH CHART, IT CAN BE NOTICED THAT THERE WAS HUGE DIFFERENCE IN RECEIPTS AS PER ITS DETAILS AND AS PE R BOOKS. DURING THE COURSE OF HEARING DATED 04-11-2011, THE ASSESSEE WA S PROVIDED ITS DATA FOR RECONCILIATION, HOWEVER, THE ASSESSEE POIN TED OUT THAT THE DIFFERENCE IN ITS DATA AND BOOKS OF ACCOUNT HAS ALR EADY BEEN SUO MOTO OFFERED FOR TAX VIDE LETTER DATED 30-09-201. THE C OPY OF THE SAID LETTER WAS FILED DURING THE COURSE OF HEARING DATED 04-11- 2011. ON GOING THROUGH THE LETTER SUBMITTED BY THE ASSESSEE, IT WA S NOTICED THAT THE ASSESSEE HAS SHOWN TOTAL TRANSPORT RECEIPT OF RS.3, 49,23,387/- IN HIS BOOKS OF ACCOUNT AND ADDITIONAL RECEIPTS OF RS.47,87,587/- HAS BEEN OFFERED THROUGH THIS LETTER. BUT THE ASSESSEE HAS NOT OFFERED DIFFERENCE OF RS.22,500/- IN THE CASE OF M/S. SHREY A INDUSTRIES IN HIS LETTER. ON ASKING, THE ASSESSEE CLARIFIED THAT THE COMPANY HAS NOT RECEIVED A SUM OF RS.22,500/- FROM THIS CONCERN AND CLAIMED THAT THERE MAY BE MISTAKE IN ITS DATA. HOWEVER, NO CLARIFICAT ION FROM DEDUCTOR WAS SUBMITTED. IN THE CIRCUMSTANCES, IT IS HELD TH AT THE ASSESSEE HAS SUPPRESSED TRANSPORT RECEIPT TO THE EXTENT OF RS.22 ,500/- ALSO ALONG WITH OTHER SUPPRESSED RECEIPT OF RS.47,87,587/-. A CCORDINGLY, THE AGGREGATED AMOUNT OF RS.48,10,087/- IS TREATED SUPP RESSED TRANSPORT RECEIPT UNDER CONSIDERATION AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. SINCE THE ASSESSEE HAS CONCEALED PARTICU LARS OF INCOME, THE PENALTY U/S.271(1)(C) R.W. EXPLANATION 1 THERETO IS INITIATED. 7. FROM THE ABOVE, IT IS EVIDENT THAT THE ASSESSEE OFFERE D ADDITIONAL RECEIPTS OF RS.47,87,587/- BY FILING A LETTER. HOWEVER, DURING THE FIRST APPELLATE PROCEEDINGS, ASSESSEE MADE AN ATTEMPT FOR FRES H RECONCILIATION AND ALSO SUBMITTED THE FACT THAT SOME OF T HE RECEIPTS DO NOT PERTAIN TO ASSESSEE AS THEY WERE ALSO OFFERED IN THE HANDS OF OTHER CONCERNS. CONTENTS OF ASSESSEES SUBMISSIONS VIDE LETTER DATED 14-09-2014 ARE RELEVANT. INFACT, THEY WERE ALREADY EXTR ACTED BY THE CIT(A) IN PARA NOS. 5 AND 7 OF HIS ORDER. EVENTUALLY, THE CIT(A) ALLOWED THE APPEAL OF THE ASSESSEE ON THIS ISSUE AND GAVE CERTAIN DIRECTIONS TO THE AO. THE CONTENTS OF PARA 8 ARE RELEVAN T AND THE SAME ARE EXTRACTED HERE AS UNDER : 8.. . . . . HOWEVER, THE AO IS DIRECTED TO WRITE T O THE AOS OF M/S. EXPRESS CARGO CORPORATION AND M/S. EXPRESS CARGO CO NTAINERS TO VERIFY THE SAID TRANSACTIONS AS SUGGESTED BY HIM IN HIS RE MAND REPORT DATED 01-08-2014 AND TAKE ACTION, IF ANY, REQUIRED TO BE TAKEN IN THEIR RESPECTIVE HANDS AFTER VERIFICATION OF THE SAID TRA NSACTIONS. AGGRIEVED WITH THE SAME, THE REVENUE IS IN APPEAL BEFORE US. 8. NARRATING THE FACTS, LD. DR FOR THE REVENUE SUBMITTED THAT THE ASSESSEE FILED A LETTER OFFERING ADDITIONAL INCOME OF RS.47,87,587 /-. RETRACTING THE SAME, ASSESSEE MADE DIFFERENT SUBMISSIONS A ND FILED ITA NO.648/PUN/2015 ISHWAR BIRBAL SHARMA 4 ADDITIONAL EVIDENCES BEFORE THE CIT(A) WHO ALLOWED THE APPEA L OF THE ASSESSEE ON THIS ISSUE. REVENUE IS AGGRIEVED AGAINST THE DECISION OF CIT(A). IT IS THE PRAYER OF LD. DR THAT ORDER OF THE AO S HOULD BE UPHELD. 9. PER CONTRA, LD. AR FOR THE ASSESSEE SUBMITTED THAT T HE TOTAL DISCREPANCY AMOUNTS TO RS.47,87,587/- OUT OF WHICH THE DISCREPA NCIES WITH REGARD TO M/S. EXPRESS CARGO CORPORATION WORKS OU T TO RS.28,12,023/-AND M/S. EXPRESS CARGO CONTAINERS WORKS OU T TO RS.6,57,614/-. BRINGING OUR ATTENTION TO PAGES 43 AND 50 OF THE PAPER BOOK, LD. AR FOR THE ASSESSEE SUBMITTED THAT THESE AMOU NTS WERE ALREADY ACCOUNTED IN THEIR ACCOUNTS FOR THE A.Y. 2009-10 AND THE SAID PAGES OF THE PAPER BOOK CONSTITUTES CONFIRMATION LETTERS IN THIS REGA RD. 10. REGARDING THE BALANCE AMOUNT OF RS.13,30,587/- (I.E., RS.47,87,587 RS.34,57,000), THE ORDER OF CIT(A) IS DEFICIENT AN D IT LACKS SPEAKING ORDER ON THESE ITEM-WISE RECONCILIATION AND THE REASONS FOR GRANTING ENTIRE RELIEF TO THE ASSESSEE. WHEN THIS ISSUE IS BROUGHT OUT TO THE LD. COUNSELS OF BOTH THE PARTIES, THEY CONCUR RED ON THE PROPOSAL TO REMAND THE MATTER TO THE FILE OF CIT(A) FOR ITEM -WISE RECONCILIATION AND PASSING OF A SPEAKING ORDER ON EACH OF S UCH ITEMS REQUIRING THE RECONCILIATION. 11. CONSIDERING THE ABSENCE OF ANY SPEAKING ORDER ON EA CH OF THE ITEM WITH DISCREPANCIES QUA THE BOOKS OF ACCOUNT OF THE A SSESSEE, WE ARE OF THE VIEW THAT AS MENTIONED IN THE OPEN COURT, THE MATTER SHOULD TRAVEL TO THE FILE OF CIT(A) FOR FRESH DECISION FOR WANT OF A S PEAKING ORDER. CIT(A) SHOULD ALSO CONSIDER THE ACTION TAKEN REPOR T, IF ANY BY THE AO, WITH REGARD TO THE DIRECTION INVOLVING THE CASES O F M/S. EXPRESS CARGO CORPORATION AND M/S. EXPRESS CARGO CONT AINERS AT THE TIME OF PASSING OF THE FINAL ORDER. REASONABLE ENQUIRY MAY BE ITA NO.648/PUN/2015 ISHWAR BIRBAL SHARMA 5 CONSIDERED TO FIND OUT IF THE SUM OF RS.28,12,023/- AND RS.6 ,57,614/- ARE TAXED IN SOME HANDS. CIT(A) SHALL GRANT REASONABLE OP PORTUNITY OF BEING HEARD TO THE ASSESSEE IN ACCORDANCE WITH SET PRI NCIPLES OF NATURAL JUSTICE. WITH THESE DIRECTIONS, GROUND NOS. 2 AND 3 ARE ALLOWED FOR STATISTICAL PURPOSES. 12. IN THE RESULT, THE APPEAL OF THE REVENUE IS PARTLY A LLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 17 TH DAY OF JANUARY, 2018. SD/- SD/- (VIKAS AWASTHY) (D. KARUNAKARA RAO) /JUDICIAL MEMBER / ACCOUNTANT MEMBER PUNE; DATED : 17 TH JANUARY, 2018. / COPY OF THE ORDER FORWARDED TO : BY ORDER // TRUE COPY // //TRUE COPY// SENIOR PRIVATE SECRETARY , / ITAT, PUNE 1. / THE APPELLANT 2. / THE RESPONDENT 3. CIT(A) - 1, NASHIK 4 . 5. CIT - 1, NASHIK % , , A BENCH PUNE; 6 . / GUARD FILE.