Aravind Seeds Private Limited, Hyderabad, Hyderabad V. DCIT, Circle-1(1), Hyderabad, Hyderabad

ITA 708/HYD/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 2373 (ITAT-HYDERABAD)
• Duration Of Justice: 7 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-12-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 04-12-2017
• Assessment Year: 2012-2013
• Appeal Filed On: 25-04-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N SWAPNA
• Assessee Lawyers: J J VARUN
• Keywords: Opportunity of being heard; Additional evidence
• Section: 142(1); 133(6); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA NO. 708HYD/2017 ASSESSMENT YEAR: 2012-13 ARAVIND SEEDS PVT. LTD., HYDERABAD. PAN AAICA 0494 K VS. DY. COMMISSIONER OF INCOME- TAX, CIRCLE 1(1), HYDERABAD. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI J.J. VARUN REVENUE BY : SMT. N. SWAPNA DATE OF HEARING 04-12-2017 DATE OF PRONOUNCEMENT 08-12-2017 O R D E R PER S. RIFAUR RAHMAN, A.M.: 1. THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF CIT(A)- I, DATED 23/01/2017. HYDERABAD RELATING TO AY 2012-13. 2. BRIEFLY THE FACTS OF THE CASE ARE, ASSESSEE A CO MPANY, ENGAGED IN THE BUSINESS OF PURCHASE, PROCESS AND SALE OF RA WSEEDS, FILED ITS RETURN OF INCOME ON 29/09/2012 DECLARING LOSS OF RS . 6,31,705/- AND INCOME UNDER MAT OF RS. 7,29,335/- FOR THE AY 2012- 13. THE CASE WAS SELECTED FOR SCRUTINY UNDER CASS AND NOTICE U/S 143(2) DATED 23/09/2013 WAS ISSUED AND SERVED ON THE ASSESSEE. F URTHER, NOTICE U/S 142(1) WAS ALSO ISSUED CALLING FOR INFORMATION. 3. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, AO ISSUED NOTICE U/S 133(6) OF THE ACT TO VERIFY THE TRADE PAYABLES AND PURCHASE OF 2 ITA NO. 708 /HYD/2017 ARAVIND SEEDS PVT. LTD. RAWSEEDS. AO HAS NOT RECEIVED ANY CONFIRMATIONS NOR ANY DOCUMENTARY EVIDENCES LIKE RELEVANT LEDGER COPIES O R SUPPORTING PAPERS FOR PURCHASES. THEREFORE, AO HAD ISSUED SHOW CAUSE NOTICE TO THE ASSESSEE AS TO WHY THESE SUNDRY CREDITORS AND P URCHASES SHOULD NOT BE CONSIDERED AS BOGUS/NON-EXISTENT LIABILITY A ND BRING THE SAME TO TAX. SINCE THERE IS NO COMPLIANCE FROM THE ASSES SEE, AO HAD DISALLOWED 20% OF THE OUTSTANDING SUNDRY CREDITORS AND PURCHASES OF RAWSEEDS. ACCORDINGLY, HE DISALLOWED RS. 49,98,950/ - ON THIS COUNT. 3.1 FURTHER, THE AO HAD NOTICED THAT ASSESSEE HAD R ECEIVED SHARE APPLICATION MONEY AMOUNTING TO RS. 64,32,342/- AS P ER THE LATEST FINANCIAL STATEMENT SUBMITTED BY THE ASSESSEE. HE F URTHER NOTICED THAT SHARES HAVE NOT BEEN ALLOTTED TO THE INVESTORS, HEN CE, ASSESSEE WAS ASKED TO SUBMIT DETAILS OF SHARE APPLICATION MONEY RECEIVED WITH RELEVANT BANK ACCOUNT COPY AND RETURNS FILED BY THE INVESTORS. HOWEVER, THERE WAS NO COMPLIANCE FROM THE ASSESSEE. ACCORDINGLY, AO MADE ADDITION OF RS. 64,32,342/-. AGGRIEVED WITH THE ABOVE ORDER, ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A). 4. EVEN THOUGH, ASSESSEE WAS GIVEN SO MANY OPPORTUN ITIES TO REPRESENT ITS CASE, ASSESSEE OR LD. AR COULD NOT AP PEAR BEFORE THE CIT(A). THE CIT(A) DISMISSED THE APPEAL FILED BY TH E ASSESSEE BY ADJUDICATING THE APPEAL ON THE BASIS OF INFORMATION AVAILABLE ON RECORD. 5. AGGRIEVED WITH THE ABOVE ORDER, ASSESSEE PREFERR ED AN APPEAL BEFORE US RAISING THE FOLLOWING GROUNDS PROTESTING AGAINST THE ADDITION TOWARDS SUNDRY CREDITORS AND PURCHASES AND ALSO ADD ITION U/S 68 TOWARDS SHARE APPLICATION MONEY. 6. BEFORE US, ASSESSEE HAS FILED PAPER BOOK CONTAIN ING ADDITIONAL EVIDENCES, WHICH WERE NOT PLACED BEFORE THE ASSESSI NG AUTHORITIES BELOW WITH A REQUEST FOR ADMISSION OF SUCH ADDITION AL EVIDENCES AND 3 ITA NO. 708 /HYD/2017 ARAVIND SEEDS PVT. LTD. SUBMITTED THAT FURTHER INFORMATION WAS ALSO MADE AV AILABLE WITH AO AND AO SHOULD HAVE VERIFIED WITH THE INFORMATION AV AILABLE ON RECORD. HE SUBMITTED THAT ASSESSEE WAS NOT GIVEN PROPER OPP ORTUNITY OF EXPLAINING ITS CASE BY THE AO. 6. LD. DR, ON THE OTHER HAND, RELIED ON THE ORDERS OF REVENUE AUTHORITIES. 7. CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL FACTS ON RECORD. IT IS CLEAR FROM THE FACTS SUBMITTED BEF ORE US THAT ASSESSEE HAS NOT UTILIZED VARIOUS OPPORTUNITIES EXTENDED BY THE CIT(A). FURTHER, ASSESSEE HAS FILED ADDITIONAL EVIDENCES BEFORE US, WHICH IT COULD HAVE FILED BEFORE THE LOWER AUTHORITIES. AS PER THE SUBMISSIONS OF THE LD. AR OF THE ASSESSEE, FOR THE FIRST TIME ASSESSEE HAS FILED FINANCIAL STATEMENTS AND RETURN OF INCOME OF THE INVESTORS BE FORE US, WHICH HAVE NOT BEEN FILED BEFORE THE AO. FURTHER, WE ALSO NOTICE THAT AO HAS DISALLOWED 20% OF THE SUNDRY CREDITORS AND PURC HASE OF RAWSEEDS AS BOGUS OR UNCONFIRMED LIABILITY. IN OUR CONSIDERE D VIEW, IN CASE, AO HAS NOT SATISFIED, WHAT IS THE RATIONALE OF DISALL OWING ONLY 20% WHEN THE WHOLE TRANSACTION IS DOUBTFUL. EVEN THE LD. AR SUBMITTED THAT ASSESSEE WAS NOT GIVEN PROPER OPPORTUNITY TO REPRES ENT ITS CASE BEFORE THE REVENUE AUTHORITIES. FOR THE SAKE OF JUS TICE, WE ARE INCLINED TO REMIT THIS APPEAL BACK TO THE FILE OF T HE AO WITH A DIRECTION TO DO ASSESSMENT DE-NOVO CONSIDERING THE ADDITIONAL EVIDENCES FILED BY THE ASSESSEE, AFTER GIVING PROPER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN THE MATTER. 4 ITA NO. 708 /HYD/2017 ARAVIND SEEDS PVT. LTD. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS TREATE D AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 8 TH DECEMBER, 2017. SD/- SD/- (P. MADHAVI DEVI) (S. RIFAUR RAH MAN) VICE PRESIDENT A CCOUNTANT MEMBER HYDERABAD, DATED: 8 TH DECEMBER, 2017 KV COPY TO:- 1) M/S ARAVIND SEEDS PVT. LTD., C/O M/S KUMAR AND GIRI, CAS., 8-2-686/B/1, 12, VYJAYANTHI, FLAT # 3 & 4, 2 ND FLOOR, ROAD NO. 12, BANJARA HILLS, HYDERABAD 500 034. 2) DCIT, CIRCLE 1(1), HYDERABAD 3) CIT(A) I, HYD. 4) PR. CIT 1, HYD. 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDE RABAD. 6) GUARD FILE S.NO. DESCRIPTION DATE INTLS 1. DRAFT DICTATED ON SR.P.S./P.S 2. DRAFT PLACED BEFORE AUTHOR SR.P.S/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5 APPROVED DRAFT COMES TO THE SR.P.S./PS SR.P.S./ P.S 6. KEPT FOR PRONOUNCEMENT ON SR. P.S./P.S. 7. FILE SENT TO THE BENCH CLERK SR.P.S./P.S 8 DATE ON WHICH FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER