Income Tax Officer-3(4), Kanpur V. Shri Subhash Chandra Omar, Kanpur Dehat

ITA 666/LKW/2014

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9123 (ITAT-LUCKNOW)
• Duration Of Justice: 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 04-12-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 14-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P K KAPOOR
• Keywords: Principle of natural justice; Additional evidence
• Section: 143(3); 154; 2

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.666/LKW/2014 ASSESSMENT YEAR:2006 - 07 SHRI SUBHASH CHANDRA OMAR, PROP. M/S SHREE KRISHANA PULSES, MAIN ROAD RURA, KANPUR DEHAT. PAN:AAFPO5683E VS INCOME TAX OFFICER - 3(4), KANPUR. (RESPONDENT) (APPELLANT) C.O.NO. 37 /LKW/201 4 (IN ITA NO.666/LKW/2014) ASSESSMENT YEAR:2006 - 07 INCOME TAX OFFICER - 3(4), KANPUR. VS SHRI SUBHASH CHANDRA OMAR, PROP. M/S SHREE KRISHANA PULSES, MAIN ROAD RURA, KANPUR DEHAT. PAN:AAFPO5683E (RESPONDENT) (APPELLANT) SHRI R. K. RAM, D. R. REVENUE BY SHRI P. K. KAPOOR, C.A. ASSESSEE BY 04/12/2014 DATE OF HEARING 23 /01/2015 DATE OF PRONOUNCEMENT O R D E R PER A. K. GARODIA, A.M. THE APPEAL IS FILED BY THE REVENUE AND THE CROSS OBJECTION IS FILED BY THE ASSESSEE, WHICH ARE DIRECTED AGAINST THE ORDER OF CIT(A) - II, KANPUR DATED 23/04/2014 FOR ASSESSMENT YEAR 2006 - 07. 2. IN ITS APPEAL, THE REVENUE HAS RAISED THE FOLLOWING GROUNDS: 1. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - II, KANPUR HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION UNDER THE HEAD CURRENT LIABILITIES AND PROVISIONS OF 2 RS.2,16,63,395/ - ON ACCOUNT OF DIFFERENCE IN AUDITOR'S REPORT AND BALANCE SHEET WITHOUT APPRECIATING THE FACTS THAT ASSESSEE FAILED TO DISPROVE THE FIGURE SHOWN IN THE AUDITOR'S REPORT DURING THE PROCEEDINGS U/S. 154 OF THE INCOME TAX ACT, 1961. 2. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - II, KA NPUR HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION UNDER THE HEAD CURRENT LIABILITIES AND PROVISIONS OF RS.2,16,63,395/ - ON ACCOUNT OF DIFFERENCE IN AUDITOR'S REPORT AND BALANCE SHEET BY CONSIDERING THE ADDITIONAL EVIDENCES DURING THE COURSE OF AP PELLATE PROCEEDINGS IGNORING THE FACT THAT THE ASSESSEE HAD INTENTIONALLY NEVER PROVIDED THE EVIDENCES BEFORE THE ASSESSING OFFICER DURING THE PROCEEDINGS U/S. 154, THUS VIOLATING THE PROVISIONS OF RULE 46A OF THE I.T. RULES, 1962. 3. THAT THE ORDER OF TH E LD.CIT(A) - II, KANPUR DATED 23.04.2014 NEEDS TO BE QUASHED AND THE ORDER PASSED BY THE ASSESSING OFFICER U/S 154 OF THE INCOME TAX ACT,1961 DATED 28.03.2013 BE RESTORED. 3. IN ITS CROSS OBJECTION, THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS: 1. BECAUSE ON A DUE CONSIDERATION OF THE FACTS OF THE CASE, THERE WAS NO MISTAKE WHICH COULD BE SAID TO BE APPARENT FROM RECORD WITHIN THE MEANING OF SECTION 154 OF THE INCOME TAX ACT, 1961 IN THE ORDER DATED 09.09.2008 PASSED UNDER SECTION 143(3) OF THE ACT IN THE CASE OF THE ASSESSEE, THEREFORE THE ID. COMMISSIONER OF INCOME TAX (APPEALS) SHOULD HAVE HELD THAT THE ALLEGED MISTAKE WAS BEYOND THE SCOPE OF RECTIFICATION UNDER SECTION 154 OF THE ACT AND CONSEQUENTLY HE SHOULD HAVE FURTHER HELD THAT THE ORDER UND ER SECTION 154 DATED 28.03.2013 WAS BAD IN LAW. 2. BECAUSE THE ORDER DATED 23.04.2014 PASSED BY THE LD. CIT(A) IS CONTRARY TO THE FACTS, LAW AND PRINCIPLES OF NATURAL JUSTICE TO THE EXTENT STATED IN GROUND NO. 1 ABOVE. 4. LEARNED D. R. OF THE REVENUE SU PPORTED THE ASSESSMENT ORDER WHEREAS LEARNED A. R. OF THE ASSESSEE SUPPORTED THE ORDER OF LEARNED CIT(A). 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT ADDITION WAS MADE BY THE ASSESSING OFFICER IN THE PRESENT ORDER U/S 154 OF THE ACT ON THE BASIS THAT AS PER PART A & B OF ANNEXURE TO AUDITORS REPORT, THE FIGURE OF 3 CURRENT LIABILITY AND PROVISION WAS SHOWN TO BE RS.4,03,16,615/ - BUT AS PER THE BALANCE SHEET , SUCH FIGURE HAS BEEN SHOWN AT RS.1,86,53,220/ - . AS PER THE ASSESSING OFFICER, THIS DI FFERENCE OF RS.2,16,63,395/ - WAS LIABLE TO BE ADDED IN THE INCOME OF THE ASSESSEE. WE FIND THAT PART A & B OF ANNEXURE TO THE AUDITORS REPORT IS AVAILABLE ON PAGE 23 OF THE PAPER BOOK WHEREIN IT IS REPORTED AGAINST COLUMN 6 THAT CURRENT LIABILITIES & PROV ISIONS IS RS.40116615.80. AGAINST COLUMN NO. 1, THE AMOUNT IS RS.1097997.39 ON ACCOUNT OF PROPRIETORS CAPITAL AND AGAINST COLUMN NO. 4, AMOUNT OF SECURED LOANS HAS BEEN NOTED AT RS.20565398/ - . UNSECURED LOAN AS PER COLUMN NO. 5 IS NOTED AT RS.9612742/ - . AS PER COLUMN NO. 7, TOTAL OF BALANCE SHEET IS SHOWN AT RS.49929357.80. ON PAGE 29 OF THE BALANCE SHEET, TOTAL OF BALANCE SHEET IS TALLYING AT RS.49929 357.80. CAPITAL ACCOUNT OF RS.1097997.39 IS ALSO TALLYING. SO IS THE CASE WITH SECURED LOANS AND UNS ECURED LOANS OF RS.20565398.00 AND RS.9612742/ - RESPECTIVELY. THE ONLY DIFFERENCE IS BETWEEN CURRENT LIABILITY & PROVISION. CONSIDERING ALL THESE FACTS, IN OUR CONSIDERED OPINION, NO ADDITION IS JUSTIFIED IN THE FACTS OF THE PRESENT CASE BECAUSE MERELY A MISTAKE IN THE REPORTING OF FIGURE S IN TAX AUDIT REPORT CANNOT BE A SOLE BASIS FOR MAKING ADDITION IN THE ABSENCE OF ANY OTHER ADVERSE MATERIAL ON RECORD. THE ISSUE WAS DECIDED BY CIT(A) AS PER PARA 6 OF HIS ORDER, WHICH IS REPRODUCED BELOW FOR THE SAK E OF READY REFERENCE: - 6. FROM THE ABOVE, IT IS OBVIOUS THAT THE CLERICAL MISTAKE HAS BEEN APPARENT WHICH HAS BEEN ACCEPTED BY THE AO. THEREFORE, THE ADDITION HAS NO BASIS. MOREOVER, THE SCRUTINY ASSESSMENT U/S. 143(3) HAS BEEN COMPLETED ON 09 - 09 - 2008 AND THE BOOKS OF ACCOUNTS ALONG WITH THE BILLS AND VOUCHERS WERE PRODUCED BEFORE THE AO WHICH HAS NOT BEEN REJECTED U/S.145(3). AS SUCH, NO DISCREPANCIES AND DEFECTS HAVE BEEN OBSERVED, THEREFORE, RECTIFYING THE ORDER U/S.143(3) FOR FURTHER CORRECTION OF A DDITION OF RS.2,16,63,395/ - U/S.154 IS NOT JUSTIFIED. FURTHER, THE ASSESSEE HAS BEEN CLARIFYING HIS STAND OF CLERICAL MISTAKES. ACCORDINGLY, THE ADDITION IS HEREBY DELETED. 5.1 FROM THE ABOVE PARA FROM THE ORDER OF CIT(A), WE FIND THAT THIS ISSUE WAS DEC IDED BY CIT(A) ON THE BASIS THAT THERE IS CLERICAL MISTAKE IN THE TAX 4 AUDIT REPORT AND IT CANNOT BE A BASIS FOR MAKING ADDITION. CONSIDERING THE FACTS OF THE PRESENT CASE, WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF CIT(A). ACCORDINGLY THIS IS SUE IS DECIDED IN FAVOUR OF THE ASSESSEE. 6. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DISMISSED. 7. NOW WE TAKE UP THE CROSS OBJECTION OF THE ASSESSEE. IN VIEW OF OUR DECISION IN RESPECT OF REVENUES APPEAL, THE CROSS OBJECTION OF THE ASSESSEE HA S BECOME INFRUCTUOUS AND IS DISMISSED. 8. IN THE RESULT, THE CROSS OBJECTION OF THE ASSESSEE STANDS DISMISSED. 9. IN THE COMBINED RESULT, THE APPEAL OF THE REVENUE AND CROSS OBJECTION OF THE ASSESSEE ARE DISMISSED. (ORDER WAS PRONOUNCED IN THE OPEN CO URT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 23 /01/2015 *C.L.SINGH COPY OF THE ORDER FORWARDED TO : 1.THE APPELLANT 2.THE RESPONDENT. 3.CONCERNED CIT 4.THE CIT(A) 5.D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR