DCIT, CHENNAI V. Advanced Construction Technolgoies P Ltd., CHENNAI

ITA 664/CHNY/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 9230 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2016
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 18-03-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R CLEMENT RAMESH KUMAR
• Keywords: Assessment record
• Section: 144

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI . , . , BEFORE SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBE R AND SHRI. G. PAVAN KUMAR, JUDICIAL MEMBER ./I.T.A. NO.664/MDS/2016 / ASSESSMENT YEAR : 2011-2012 THE DEPUTY COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE 1(1) CHENNAI 600 034. VS. M/S. ADVANCED CONSTRUCTION TECHNOLOGIES P. LTD. 19, CENOTAPH ROAD, CHENNAI 600 018. [PAN AAACP 1904F] ( / APPELLANT) ( /RESPONDENT) ! ' # / APPELLANT BY : SHRI.R. CLEMENT RAMESH KUMAR, ADDL. CIT $% ! ' # /RESPONDENT BY : NONE & ' ' ( /DATE OF HEARING : 24-05-2016 ) ' ' ( /DATE OF PRONOUNCEMENT : 31-05-2016 / O R D E R PER G. PAVAN KUMAR, JUDICIAL MEMBER: THE APPEAL FILED BY THE REVENUE IS DIRECTED AG AINST ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-1, CHENNAI IN ITA NO.180/14- 15, DT 29.12.2015 FOR THE ASSESSMENT YEAR 2011-2012 PASSED U/S.144 AND 250 OF THE INCOME TAX ACT, 1961 (HEREIN AFTER REFE RRED TO AS THE ACT). ITA NO.664/MDS/2016. :- 2 -: 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS:- 2.1 THE LEARNED CIT(A) ERRED IN HOLDING THAT THE SUBMISSION MADE BY THE ASSESSEE HAVE NOT BEEN CONTROVERTED BY THE AO REGARDING THE NON- COMPLIANCE TO STATUTORY NOTICES THEREBY ALLOWING THE APPEAL OF THE ASSESSEE ON THIS GROUND. 2.2 THE LEARNED CIT(A) OUGHT TO HAVE APPRECIATED TH E FACT THAT THE ASSESSEE HAD NOT FURNISHED THE DETAILS CALLED F OR BY THE ASSESSING OFFICER TILL THE DATE OF COMPLETION OF SC RUTINY ASSESSMENT. 3.1 THE LEARNED CIT(A) ERRED IN DIRECTING TH-E ASSE SSING OFFICER TO DELETE THE ADDITION MADE DUE TO MISMATCH OF 26AS WITH P&L ACCOUNT. 3.2 THE LEARNED CIT(A) FAILED TO AFFORD AN OPPORTUN ITY TO THE ASSESSINQ OFFICER TO EXAMINE THE DETAILS OF RECONCI LIATION BETWEEN FORM 26AS AND P&L ACCOUNT PRODUCED BY THE ASSESSEE BEFORE HIM WHICH WAS NOT PRODUCED BEFORE T HE ASSESSING OFFICER AT THE TIME OF SCRUTINY PROCEEDIN GS. 3.2 THE LEARNED CIT(A) FAILED TO NEITHER GIVE AN OP PORTUNITY TO THE ASSESSING OFFICER TO EXAMINE THE DETAILS NOR CA LLED FOR A REMAND REPORT, THEREBY VIOLATING THE PROVISIONS OF RULE 46A OF THE I.T. RULES 1962. 3. THE BRIEF FACTS OF THE CASE IS THAT THE ASSESSEE CO MPANY IS ENGAGED IN THE BUSINESS OF EXECUTION OF CIVIL ENGIN EERING CONTRACTS AND FILED RETURN OF INCOME ON 29.02.2012 FOR THE ASSESS MENT YEAR 2010-2011 ADMITTING A LOSS OF 81,14,89,329/- AND THE RETURN WAS PROCESSED U/S.143(1) OF THE ACT. SUBSEQUENTLY, CASE WAS SELE CTED FOR SCRUTINY AND NOTICE U/S.143(2) OF THE ACT WAS ISSUED AND ASSESS EE WAS PROVIDED OPPORTUNITY FOR FILING DETAILS AND ASSESSING OFFICE R MADE A FINDING THAT THE CASE WAS NOT REPRESENTED ON BEHALF OF THE ASSESSEE COMPANY AND ITA NO.664/MDS/2016. :- 3 -: COMPLETED ASSESSMENT BASED ON NOTICE U/S.139C OF TH E ACT DATED 10.08.2012 FOR FURNISHING OF RECONCILIATION STATEME NT OF GROSS RECEIPTS AS PER 26AS AND INCOME ADMITTED IN THE PROFIT AND LOSS ACCOUNT. THE LD. ASSESSING OFFICER FOUND DIFFERENCE IN COMPARISON WI TH TDS CERTIFICATE /26AS IN COMPARISON WITH PROFIT AND LOSS ACCOUNT A ND MADE AN ADDITION UNDER THREE HEADS OF INCOME, INTEREST 83,86,040/-, COMMISSION 842,18,426/- AND LABOUR CHARGES 829,56,674/- AS THE RE WAS NO CLARIFICATION WAS SUBMITTED INSPITE OF ISSUANCE OF NOTICE U/S.142(1) OF THE ACT, THE LD. ASSESSING OFFICER MADE BEST JUDGMENT U /S.144 OF THE ACT AND ASSESSED LOSS OF 839,28,189/- VIDE ORDER DATED 28.0 3.2014. AGGRIEVED BY THE ORDER, THE ASSESSEE FILED AN APPEAL BEFORE COMM ISSIONER OF INCOME TAX (APPEALS). 4. IN THE APPELLATE PROCEEDINGS, THE LD. AUTHORISED RE PRESENTATIVE ALLEGED THAT THE LD. ASSESSING OFFICER ASSESSMENT U /S.144 OF THE ACT IS BAD IN LAW AND ALSO MISMATCH OF 26AS AND PROFIT AND LOS S ACCOUNT ARE DULY SUPPORTED WITH CLARIFICATION. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) BASED ON THE GROUNDS AND ARGUMENTS OF THE LD. AUTHORISED REPRESENTATIVE ON THE ISSUE OF COMPLETION OF ASSESS MENT U/S.144 OF THE ACT OBSERVED THE PROVISIONS OF SEC. 144 OF THE ACT. THE ASSESSEE HAS FILED DETAILS ON 29.08.2012 IN RESPONSE TO NOTICE U/S.14 2(1) OF THE ACT AND ALSO PRODUCED SOFT COPIES OF BOOKS OF ACCOUNT FOR THE Y EAR ENDING 31.03.2011 VIDE ACKNOWLEDGMENT DATED 27.01.2014. THE ASSESSEE WAS REQUESTED FOR ITA NO.664/MDS/2016. :- 4 -: THE FIRST TIME TO SUBMIT RECONCILIATION STATEMENT. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) BASED ON THE ASSESSMENT RECORD S AND COMPLIANCE OF THE STATUTORY NOTICE BY THE ASSESSEE CONSIDERED THE ASSESSMENT CANNOT BE COMPLETED U/S.144 OF THE ACT AND ALLOWED THE GRO UND. IN RESPECT OF SECOND GROUND OF MISMATCH OF AMOUNT ON COMPARISON OF 26AS AND PROFIT AND LOSS ACCOUNT, THE LD. COMMISSIONER OF INCOME TA X (APPEALS) CONSIDERED THE FINDINGS OF THE ASSESSING OFFICER A ND SUBMISSIONS ON ADDITION OF 875,61,144/-. THE LD. AUTHORISED REPR ESENTATIVE SUBMITTED THAT THE ASSESSEES MAIN ACTIVITY IS UNDERTAKING, E XECUTING, DEMOLISHING CONTRACT AND DEMONSTRATED THE CLARIFICATION BY WAY OF TABULAR COLUMN IN RESPECT OF DISPUTED ISSUE AND THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ON PERUSAL OF THE TABULAR COLUMN OF CONTR ACT RECEIPTS, COMMISSION RECEIVED AND RENTAL INCOME WAS SATISFIED WITH THE REASONS PUT FORTH BY THE ASSESSEE AND DIRECTED THE ASSESSING OF FICER TO DELETE THE ADDITION AND ALLOWED THE APPEAL OF THE ASSESSEE. AG GRIEVED BY THE COMMISSIONER OF INCOME TAX (APPEALS) ORDER, THE REV ENUE HAS ASSAILED AN APPEAL BEFORE TRIBUNAL. 5. BEFORE US, THE LD. DEPARTMENTAL REPRESENTATIVE REI TERATED THE GROUNDS AND SUBMITTED THAT THE COMMISSIONER OF INCO ME TAX (APPEALS) HAS ERRED IN CONSIDERING THE SUBMISSIONS OF THE ASS ESSEE WHICH THE ASSESSEE HAS NOT FILED BEFORE ASSESSING OFFICER IN THE ASSESSMENT ITA NO.664/MDS/2016. :- 5 -: PROCEEDINGS EVEN BEFORE COMPLETION OF ASSESSMENT. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS NOT OFFERE D OPPORTUNITY TO ASSESSING OFFICER TO VERIFY AND EXAMINE THE RECONCI LIATION STATEMENT AND NO INFORMATION WAS CALLED BY WAY OF REMAND REPORT A ND THERE IS VIOLATION OF RULE 46A AND PRAYED FOR ALLOWING THE APPEAL. 6. AT THE TIME OF HEARING, NONE APPEARED ON BEHALF OF THE ASSESSEE. WE PROCEED TO DISPOSE THE CASE ON MERITS AFTER HEARING THE LD. DEPARTMENTAL REPRESENTATIVE. THE ONLY CONTENTION OF THE LD. DEPARTMENTAL REPRESENTATIVE BEING THAT LD. COMMISSIONER OF INCO ME TAX (APPEALS) HAS ERRED IN DIRECTING THE ASSESSING OFFICER IN DELETIN G THE ADDITION AND ALSO NOT CALLED FOR ANY REMAND REPORT FROM THE ASSESSING OFFICER. ON PERUSAL OF THE ASSESSMENT ORDER, THE ASSESSEE HAS FILED DE TAILS AND CERTAIN INFORMATION HAS BEEN CALLED BY THE LD. ASSESSING OF FICER BY ISSUING NOTICE U/S.139C OF THE ACT AND THERE IS NO FINDINGS ABOUT RECONCILIATION OF STATEMENT OR EVIDENCE OF RECONCILIATION FILED IN TH E COURSE OF ASSESSMENT. IN THE APPELLATE PROCEEDINGS, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS CONSIDERED THE RECONCILIATION STATEME NT AND HAVING SATISFIED WITH IT ALLOWED THE APPEAL OF THE ASSESSEE. THE FA CT REMAINS THAT THE LD. ASSESSING OFFICER WAS NOT PROVIDED OPPORTUNITY TO V ERIFY THE RECONCILIATION STATEMENT OF 26AS AND PROFIT AND LOSS ACCOUNT PRODU CED IN THE APPELLATE PROCEEDINGS. THEREFORE, CONSIDERING THE APPARENT F ACTS, WE ARE OF THE ITA NO.664/MDS/2016. :- 6 -: OPINION THAT THE ASSESSING OFFICER SHOULD BE PROVID ED OPPORTUNITY UNDER PROVISIONS OF RULE 46A AS EVIDENCE WAS FILED FOR TH E FIRST TIME BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS). THEREFORE, W E REMIT THE DISPUTED ISSUE TO THE FILE OF THE ASSESSING OFFICER TO VERIF Y THE RECONCILIATION STATEMENT AND SATISFY WITH GENUINENESS AND PROVIDE OPPORTUNITY OF HEARING TO THE ASSESSEE BEFORE PASSING THE ORDER. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IN ITA NO.664/MDS/2016 IS ALLOWED FOR STATISTICAL PURPOSE . ORDER PRONOUNCED ON TUESDAY, THE 31 ST DAY OF MAY, 2016 AT CHENNAI. SD/- SD/- ( . ! ) (A. MOHAN ALANKAMONY) # $% / ACCOUNTANT MEMBER ( & . ' ( ) (G. PAVAN KUMAR) ) $% / JUDICIAL MEMBER *& / CHENNAI + / DATED: 31 ST MAY, 2016. KV , ' $'./ 0/' / COPY TO: 1 . ! / APPELLANT 2. $% ! / RESPONDENT 3. 1' () / CIT(A) 4. 1' / CIT 5. /4 5 $'6 / DR 6. 5 7 8 & / GF