Shri Ajay Kumar Jain, Kolkata V. ITO, Ward - 53(4),Kolkata, Kolkata

ITA 672/KOL/2010

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 83181 (ITAT-KOLKATA)
• Duration Of Justice: 4 year(s) 7 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-11-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 13-08-2014
• Assessment Year: 2004-2005
• Appeal Filed On: 07-04-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S CHATTOPADHYAY ROY
• Assessee Lawyers: S BAKSHI
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 131

Judgement Text

, B , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: KOLKATA ( ) BEFORE , /AND , ) [BEFORE SHRI MAHAVIR SINGH, JM & SHRI SHAMIM YAHYA , AM ] / I.T.A NO. 672 /KOL/20 1 0 / ASSESSMENT YEAR : 200 4 - 0 5 AJAY KUMAR JAIN VS. INCOME - TAX OFFICER, WD - 53 ( 4 ), KOLKATA. (PAN: A CVPJ4585C ) ( /APPELLANT ) ( / RESPONDENT ) DATE OF HEARING: 11 . 11 .201 4 DATE OF PRONOUNCEMENT: 11 . 1 1 .201 4 FOR THE APPELLANT : SHRI S . BAKSHI, AR FOR THE RESPONDENT : SMT. S. CHATTOPADHYAY (ROY), JCIT / ORDER PER SHRI MAHAVIR SINGH, JM : THIS APPEAL BY ASSESSEE IS ARISING OUT OF ORDER OF CIT (A) - X XX I II, KOLKATA IN APPEAL NO. 313 /CIT(A) - XX X I II/ WD - 53(4),KOL/06 - 07 DATED 31 . 12 .20 09 . ASSESSMENT W AS FRAMED BY ITO, WARD - 53 ( 4 ), KOLKATA U/S. 1 4 3 (3) OF THE INCOME - TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT ) FOR ASSESSMENT YEAR 200 4 - 0 5 VIDE HIS ORDER DATED 27 . 1 2 .20 0 6 . 2. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE TOOK US TO THE SECOND GROUND THAT THE AO EX PARTE RECORDED THE STATEMENT OF TWO SUPPLIERS, WHOSE PURCHASES WERE DISALLOWED TO THE EXTENT OF RS.12,38,500/ - AND NO OPPORTUNITY TO CROSS EXAMINE OR EVEN TO AT TEND THE CHIEF EXAMINATION WAS ALLOWED. FOR THIS, THE FOLLOWING IS THE GROUND NO.2 OF THE ASSESSEE: 2 . THAT THE DISALLOWANCE IS SOLELY ON THE BASIS OF EX PARTE DENIAL OF TWO SUPPLIERS OF HAVING SUPPLIED ANY BALL PENS IN THE VALUE OF RS.12,38,500/ - AS AFORE SAID WITHOUT GETTING THE TRUTH OF THE TESTIMONY TESTED BY CROSS EXAMINATION IN DUE PROCESS OF LAW AND STANDS INADMISSIBLE EVIDENCE. 3. FIRST OF ALL LD. COUNSEL FOR THE ASSESSEE TOOK US TO PARA 3.4.4 WHEREBY STATEMENT OF SHRI GURUPADA MONDAL AND PANCHU CHARAN MONDAL WAS RECORDED AFTER ISSUING SUMMONS U/S. 131 OF THE ACT. ACCORDING TO AO, THE ASSESSEE HAS MADE CASH PURCHASES FROM FOLLOWING EIGHT PARTIES: 2 ITA NO. 672 /K/201 0 AJAY KUMAR JAIN AY 2004 - 0 5 SL. NAME AND ADDRESS PURCHASE (RS.) MODE OF PAYMENT ITEM OF PURCHASE 1. DILIP HALDER, VILL: SAIPUR, P.O. FATEHPUR, P.S. FALTA, 24 PGS (S) 6,39,000 CASH D/F BALL PEN 2. M/S. J. N. ENTERPRISE, VILL. CHOKE DEBU GHOSH, P.O. BOINCHHERIA, PS USTHI, 24 PGS(S) 6,93,000 CASH D/F BALL PEN 3. M/S. GOUR ENTERPRISE, VILL & PO CHABERIA, PS FALTA, 24 PGS (S) 6,16,500 CASH D/F BALL PEN 4. M/S. MAA AMBEY ENTERPRISE, SIRAKOLE, USTHI ROAD, 25 PARGANAS (S), W.B. 7,11,000 CASH D/F BALL PEN 5. M/S. P. C. MONDAL, VILL CHOKE DEBU GHOSH, PO BOINCHBERIA, PS USTHI, 24 PGS (S) 5,44,500 CASH D/F BALL PEN 6. M/S. SOFT WRITING AIDS, VILL SARGORIA, PS FALTA, PO CHABERIA, 24 PGS (S) 6,48,000 CASH D/F BALL PEN 7. M/S. WESTERN ENTERPRISE, VILL RAMESWARBHATI, DIST 24 PARGANAS (S) 6,48,000 CASH D/F BALL PEN 8. M/S. VEEKEY ENTERPRISE, 7, RABINDRA SARANI, DUM DUM, KOLKATA - 65 6,84,000 CASH D/F BALL PEN AS PER AO, THE FOLLOWING FIVE PARTIES WERE NOT AVAILABLE ON THE PROVIDED ADDRESS: I) M/S. GOUR ENTERPRISE, II) M/S. MAA AMBEY ENTERPRISE, III) M/S. SOFT WRITING AIDS, IV) M/S. WESTERN ENTERPRISE, V) M/S. VEEKEY ENTERPRISE FURTHER, THE FOLLOWING THREE PARTIES DENIED ANY TRANSACTION WITH THE ASSESSEE: I) M/S. DILIP HALDER, II) M/S. J. N. ENTERPRISE, III) M/S. P. C. MONDAL 4. NOW THE LD. COUNSEL FOR THE ASSESSEE DREW OUR ATTENTION THAT NEITHER THE DENIAL BY THE PARTIES NOR NON - SERVICE OF NOTICES ON THE FIVE P ARTIES WAS COMMUNICATED TO THE ASSESSEE. EVEN THIS PLEA WAS RAISED BEFORE CIT(A) BUT PURCHASES TO THE EXTENT OF RS.12,38,500/ - IN RESPECT OF M/S. J. N. ENTERPRISES AND M/S. P. C. MONDAL HAVE NOT BEEN ACCEPTED AS GENUINE AND WHICH WAS CONFIRMED BY CIT(A) VI DE PARA 3.12 AS UNDER: 3.12 I N VIEW OF THE ABOVE SUB M ISSION OF THE ASSESSING OFFICER IN THE REMAND REPORT IT BECOMES CLEAR THAT NO EVIDENCE ON MATERIAL WAS BROUGHT ON RECORD BY THE ASSESSING OFF I CER TO PROVE THAT M/S. BENZ PACIFIC PTE LTD DID NOT EXIST A SSESSING OFFCER HIMSEIF HAS ADMITTED THAT BECAUSE THE A.O DOUBTED THE GENUINENESS OF EXISTENCE OF M/S. BENZ PACIFIC PTE LTD, HE DOUBTED THE G E NUINENESS OF THE ASSESSEE S PURCHASES FROM THE 8 PARTIES AND ASSESSEE S SALE OF REJECTED MATERIAL AT ROCK - BOTTOM VALUE. THE ASSESSING OFFICER HAS ACCEPTED THAT ONLY PURCHASES FROM THE 2 PARTIES DENYING THE TRANSACTION WITH ASSESSEE (TOTAL PURCHASE RS.12,38,500/ - ) COULD BE TREATED AS BOGUS AS THE A.O HAD BROUGHT POSITIVE EVIDENCE IN THE NATURE OF DEPOSITION AND THAT R EMAINING 6 PARTIES COULD NOT BE TREATED AS BOGUS AND PURCHASES TO THE EXTENT OF RS.39,45,500 / - 3 ITA NO. 672 /K/201 0 AJAY KUMAR JAIN AY 2004 - 0 5 HAS BEEN ACCEPTED BY HIM. IN VIEW OF THE ABOVE REPORT OF THE ASSESSING OFFICER IT S HELD THAT EXPORT ORDER FROM SINGAPORE PARTY WAS GENUNE AS NO EVIDENCES TO THE CONTRARY ARE ON RECORD. THE PURCHASES TO THE EXTENT OF RS.39,45,500/ - AS ACCEPTED BY THE ASSESSING OFFICER ARE CONSIDERED TO BE GENUINE. PURCHASE TO THE EXTENT OF RS.12,38,500/ - IN RESPECT OF M/S. J.N.ENTERPRISE AND M/S. P.C.MONDAL ARE NOT ACCEPTED. T HE INCOME FOR M M/S. VAISHNO WRITING PRODUCTS IS THEREFORE DETERMINE AT ( L OSS) RS.24,87,592/ - (RS.37,26,092/ - - RS.12,38,500/ - ). ONLY ON THE BASIS OF EX PARTE DENIAL OF TWO SUPPLIERS THIS WAS CONFIRMED BY CIT(A). WHEN THIS WAS POINTED OUT TO LD. SR. DR, SHE FAIRLY CONCEDED THAT YES, NO OPPORTUNITY TO CROSS EXAMINE TO THESE PARTIES WERE ALLOWED TO THE ASSESSEE BY THE AO. AS THIS IS A QUESTION OF NATURAL JUSTICE, THIS IS TO BE FOLLOWED BY MAKING ADDITION. THE ASSESSEE SHOULD BE ALLOWED OPPORTUNITY OF BEIN G HEARD AND ALSO OPPORTUNITY TO CROSS EXAMINE TO THESE TWO PARTIES IN CASE THE AO WANTS TO MAKE ADDITION. ON THIS, BENCH ASKED BOTH THE ASSESSEE AS WELL AS LD. SR. DR WHETHER THE ISSUE CAN BE REMITTED BACK TO THE FILE OF THE AO FOR FRESH ADJUDICATION. BO TH AGREED FOR THE SAME. THE AO WILL ALLOW OPPORTUNITY OF BEING HEARD AND ALSO ALLOW OPPORTUNITY TO CROSS EXAMINE THESE TWO PARTIES. ASSESSEE IS ALSO FREE TO PRODUCE THE EVIDENCE IN RESPECT OF PURCHASES MADE FROM THESE TWO PARTIES SO THAT HE CAN PROVE THE GENUINENESS OF PURCHASES. IN VIEW OF THE ABOVE, WE SET ASIDE THIS ISSUE TO THE FILE OF THE AO. THE APPEAL OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 5 . IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 6 . ORDER PRONOUNCED IN OPEN COURT . S D / - S D / - , , ( SHAMIM YAHYA ) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 11 TH NOVEMBER , 201 4 JD.(SR.P.S.) - COPY OF THE ORDER FORWARDED TO: 1 . / A PPELLANT SHRI AJAY KUMAR JAIN, 32/36, DIAMOND HARBOUR ROAD, A - 305, OXFORD VIEW, KOLKATA - 700 008 2 / RESPONDENT ITO, WARD - 53(4), KOLKATA. 3 . ( )/ THE CIT(A), KOLKATA 4. 5. / CIT KOLKATA / DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, / BY ORDER, /ASSTT. REGISTRAR .