Appeal Details
Counselvise Citation
[2019] 117 COUNSELVISE.COM (IT) 1362 (ITAT-BANGALORE)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
2 year(s) 2 month(s) 22 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
14-06-2019
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
A
Assessment Year
2010-2011
Appeal Filed On
23-03-2017
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : BANGALORE BEFORE SHRI N.V VASUDEVAN, VICE PRESIDNET AND SHRI B.R BASKARAN, ACCOUNTANT MEMBER ITA NO.663/BANG/2018 ASSESSMENT YEAR : 2010-11 SHRI B.N MALATESH, NO.467, 16 TH CROSS, BEML LAYOUT, I STAGE, BASAVESHWARANAGAR, BENGALURU-560 079. PAN ACAPM 2782 M VS. THE INCOME-TAX OFFICER, WARD-10(2), BANGALORE. APPELL ANT RESPONDENT APPELLANT BY : SHRI V CHANDRASEKHAR, ADVOCATE RESPONDENT BY : DR. SHANKAR PRASAD, ADDL. CIT DATE OF HEARING : 11.06.2019 DATE OF PRONOUNCEMENT : 14.06.2019 O R D E R PER B.R BASKARAN, ACCOUNTANT MEMBER THE ASSESS HAS FILED THIS APPEAL CHALLENGING THE ORDER DATED 6/1/2017 PASSED BY LD CIT(A)-6, BENGALURU AND IT RE LATES TO ASST. YEAR 2010-11. 2. THE ASSESSEE IS AGGRIEVED BY THE DECISION OF LD CIT(A) IN CONFIRMING THE ADDITION MADE BY THE AO TOWARDS CES SION OF CREDITORS LIABILITIES. ITA NO.663/BANG/2017 PAGE 2 OF 6 3. WE HEARD PARTIES AND PERUSED THE RECORD. THE AS SESSEE IS ENGAGED IN THE BUSINESS OF MANUFACTURE AND SUPPLY O F REFLECTIVE SIGN BOARDS. DURING THE COURSE OF ASST. PROCEEDING S, THE ASSESSEE COULD NOT PRODUCE THE BOOKS OF ACCOUNTS BEFORE THE AO. IN THIS REGARD HE FILED A LETTER DATED 16/8/2012 STATING TH AT THE BOOKS OF ACCOUNTS HAVE BEEN SEIZED BY THE OFFICERS OF CENTRA L EXCISE DEPARTMENT. HOWEVER, THE AO TOOK THE VIEW THAT THE ASSESSEE IS AVOIDING PRODUCTION OF BOOKS OF ACCOUNT. THE AO NO TICED THAT THE BALANCE SHEET OF THE ASSESSEE DISCLOSED SUNDRY CRED ITORS BALANCE OF RS.80.71 LAKHS. THE AO ASKED THE ASSESSEE TO FURNI SH NAMES AND ADDRESSES OF THE SUNDRY CREDITORS AND ALSO CONFIRMA TION OBTAINED FROM THEM. HOWEVER, THE ASSESSEE FURNISHED ADDRESS ES FOR FEW PERSONS ONLY. THE AO ISSUED A LETTER TO THOSE PER SONS REQUESTING THEM TO CONFIRM THE BALANCES. HOWEVER, ONLY FEW O F THE PERSONS CONFIRMED THE BALANCE AND SUM OF THE LETTERS ALSO WERE RETURNED UN-SERVED. HENCE, THE AO TOOK THE VIEW THAT THE AS SESSEE HAS FAILED TO PROVE THE GENUINENESS OF THE CREDITORS ACCORDING LY HE MADE AN ADDITION OF RS.76.43 LAKHS. THE SAME WAS CONFIRMED BY LD CIT(A). 4. THE LD AR SUBMITTED THAT THE ASSESSEE COULD NOT FURNISH THE BOOKS OF ACCOUNTS BEFORE THE AO SINCE THE SAME WAS SEIZED BY THE CENTRAL EXCISE DEPARTMENT. HOWEVER, THE ASSESSEE F URNISHED CERTAIN DETAILS BEFORE THE LD CIT(A) AND HENCE THE LD CIT(A) CALLED FOR A REMAND REPORT FROM THE AO. HOWEVER, IN THE REMAN D REPORT THE AO REITERATED THE OBSERVATIONS MADE BY HIM IN THE A SST. ORDER. EVEN THOUGH THE ASSESSEE SOUGHT AN OPPORTUNITY BEFO RE LD CIT(A) TO REBUT THE REMAND REPOT, YET THE LD CIT(A) DISMISSED THE APPEAL OF ITA NO.663/BANG/2017 PAGE 3 OF 6 THE ASSESSEE WITHOUT AFFORDING AN OPPORTUNITY TO TH E ASSESSEE. THE LD AR SUBMITTED THAT THE ASSESSEE WOULD BE IN A POS ITION TO FURNISH ALL THE DETAILS TO PROVE THE CREDIT BALANCES. HE F URTHER SUBMITTED THAT THE ADDITIONS MADE BY THE AO ALSO INCLUDES OP ENING BALANCES IN THE CASE OF CERTAIN CREDITORS WHICH COULD NOT HA VE BEEN ADDED DURING THE YEAR UNDER CONSIDERATION. ACCORDINGLY L D AR SUBMITTED THAT THE ENTIRE MATTER REQUIRES FRESH EXAMINATION A ND ACCORDINGLY PRAYED THAT THE ISSUE MAY BE RESORTED TO THE FILE O F THE AO. 5. ON THE CONTRARY, THE LD DR SUBMITTED THAT THE AS SESSEE HAS NOT FURNISHED NAME AND ADDRESS OF MANY CREDITORS. F URTHER THE LETTER SENT BY THE AO TO SOME OF THE CREDITORS WERE RETURNED UNSERVED OR NOT RESPONDED. WHEREVER THE CREDITORS HAVE RESPONDED AND CONFIRMED THE BALANCES, THE AO HAS GIVEN RELIEF . SINCE THE ASSESSEE DID NOT CO-OPERATE BEFORE THE AO, THE LD DR CONTENDED THAT THE LD CIT(A) WAS JUSTIFIED IN CONFIRMING THE ADDITION MADE BY THE AO. 6. WE HEARD THE RIVAL CONTENTIONS AND PERUSED THE R ECORD. FROM THE PERUSAL OF THE DOCUMENTS FILED BY THE ASSESSEE WE NOTICED THAT THE ASSESSEE WAS SUBJECTED TO ACTION BY CENTRAL EXC ISE AUTHORITIES ON 29/11/2010 AND ACCORDING TO THE ASSESSEE THE BOO KS OF ACCOUNTS HAVE BEEN SEIZED BY THE CENTRAL EXCISE AUT HORITIES. THE ASSESSEE HAS WRITTEN LETTERS TO CENTRAL EXCISE AU THORITIES TO RETURN THE DOCUMENTS. HENCE, THERE APPEARS TO BE MERIT I N THE CONTENTIONS OF THE ASSESSEE THAT IT COULD NOT PRODU CE THE BOOKS OF ACCOUNTS FOR REASONS BEYOND HIS CONTROL. UNDER THE SET OF FACTS, WE ARE OF THE VIEW THAT THE ASSESSEE SHOULD BE PROVIDE D WITH AN ITA NO.663/BANG/2017 PAGE 4 OF 6 OPPORTUNITY TO PRODUCE THE BOOKS OF ACCOUNT, CONFIR MATIONS FROM CREDITORS ETC., IN ORDER TO PROVE GENUINENESS OF TH E CREDIT BALANCES. ACCORDING TO LD AR THE ADDITIONS MADE BY THE AO INC LUDES OPENING BALANCES OF CERTAIN CREDITORS WHICH COULD NOT HAVE BEEN MADE DURING THE YEAR UNDER CONSIDERATION. THIS SUBMISSI ON OF THE ASSESSE ALSO REQUIRES EXAMINATION UNDER THE SET OF FACTS THERE IS MERIT IN THE CONTENTIONS OF THE ASSESSEE THAT THI S ISSUE REQUIRES FRESH EXAMINATION AT THE END OF THE AO. ACCORDINGLY WE SET ASIDE THE ORDER PASSED BY THE LD CIT(A) AND RESTORE ALL THE I SSUES TO THE FILE OF THE AO FOR EXAMINING IT AFRESH. THE ASSESSEE IS AL SO DIRECTED TO PRODUCE THE BOOKS OF ACCOUNT, CONFIRMATION FROM THE CREDITORS IN ORDER TO PROVE THE GENUINENESS OF THE CREDITORS AF TER AFFORDING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE . THE AO MAY TAKE APPROPRIATE DECISION IN ACCORDANCE WITH LAW. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 14 TH JUNE, 2019. SD / - (N.V VASUDEVAN) VICE PRESIDENT SD/ - (B.R BASKARAN) ACCOUNTANT MEMBER BANGALORE, DATED, 14 TH JUNE, 2019. /VMS / ITA NO.663/BANG/2017 PAGE 5 OF 6 COPY TO: 1. THE APPLICANT 2. THE RESPONDENT 3 . THE CIT 4. THE CIT(A) 5. THE DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER A SST. REGISTRAR, ITAT, BANGALORE.
Mehul