DCIT, Jalgaon V. Shri Amar Pamanand Khatri, Jalgaon

ITA 749/PUN/2010

• Counselvise Citation: 74924514 RSA 2010
• Duration Of Justice: 3 year(s) 1 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-06-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 10-05-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 18-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K K OJHA
• Assessee Lawyers: RASIK TARWALA; MAHESH BUDHWANI
• Keywords: Principle of natural justice

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B , PUNE BEFORE: SHRI G. S. PANNU, ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER ITA NO. 749 / P N/ 20 10 ASSESSMENT YEAR : 2006 - 07 THE DY. COMMISSIONER OF INCOME TAX, C IRCLE - 2, JALGAON VS. SHRI AMAR PARMANAND KHATRI, PROP. OF AMAR TRADING COMPANY, PLOT NO. 171/3, NANDGAON ROAD, BODWAD, TQ. BHUSAWAL, DIST. JALGAON (APPELLANT) (RESPONDENT) PAN NO. ABPPK2146K CO NO. 35 /PN/20 11 (ARISING OUT OF ITA NO.749/PN/2010) ASSES SMENT YEAR : 2006 - 07 SHRI AMAR PARMANAND KHATRI, PROP. OF AMAR TRADING COMPANY, PLOT NO. 171/3, NANDGAON ROAD, BODWAD, TQ. BHUSAWAL, DIST. JALGAON THE DY. COMMISSIONER OF INCOME TAX, CIRCLE - 2, JALGAON VS. (APPELLANT ) (RESPONDENT) PAN NO. A BPPK2146K A SSESSEE BY: SHRI RASIK TARWALA & SHRI MAHESH BUDHWANI RE VENUE BY: SHRI K.K. OJHA DATE OF HEARING : 07 - 06 - 2013 DATE OF PRONOUNCEMENT : 21 - 06 - 2013 ORDER P ER R.S. PADVEKAR , JM : - THE REVENUES APPEAL AS WELL AS THE ASSESSEES CROS S OBJECTION W ERE DISPOSED OF BY THE TRIBUNAL BY COMMON ORDER DATED 17 - 07 - 2012. THE ASSESSEE MOVED THE APPLICATION U/S. 254(2) FOR NON - CONSIDERATION OF ONE OF THE GROUND S ON THE ISSUE OF DISALLOWANCE OF THE SARPAN EXPENDITURE AND THE TRIBUNAL HAS RECALLE D THE ORDER IN THE CROSS OBJECTION FILED BY THE ASSESSEE FOR THE LIMITED PURPOSE OF DECIDING THE ISSUE WHICH WAS OTHERWISE NOT DECIDED IN THE ORIGINAL ORDER. IN THE CROSS OBJECTION THE ASSESSEE HAS TAKEN THE FOLLOWING GROUND . GROUND N O. 1 READ S AS UNDER: 2 ITA NO. ITA NO. 749/PN/2010 & CO NO. 35/PN/2011, SHRI AMAR PARMANAND KH ATRI, JALGAON THAT THE LEARNED CIT(A) ERRED IN FACT AND IN LAW IN APPRECIATING AND CONSIDERING THE FACT AND CIRCUMSTANCES IN WHICH ASSESSING OFFICER MADE DISALLOWANCE AND CIT(A) ALLOWED PARTLY RELIEF. PARTICULARS PURCHASED DISALLOWED RELIEF CONFIRMED BY AO BY CIT(A) B Y CIT(A) EQUIPMENT 55,330/ - CAUSTIC SODA 51,900/ - _________ 1,07,230/ - 1,02,230/ - 50,000/ - 52,230/ - SARPAN 1,48,500/ - 1,43,500/ - 50,000/ - 93,500/ - 2. SO FAR AS THE ISSUE OF EQUIPMENT AND CAUSTIC SODA IS CONCERNED. THE SAME HAS B EEN DECIDED BY THE TRIBUNAL IN PARA NO. 5.2 OF THE ORDER. IN RESPECT OF THE ISSUE OF EXPENDITURE O N SARPAN WHICH WAS DISALLOWED BY THE ASSESSING OFFICER TO THE EXTENT OF RS.1,43,500/ - , THE SAME REMAINED TO BE ADJUDICATED T HOUGH THE GROUND IS REPRODUCED IN THE ORDER OF THE TRIBUNAL. 3. THE FACTS IN BRIEF AS NOTED BY THE ASSESSING OFFICER ARE AS UNDER. THE ASSESSEE HAS CLAIMED THE EXPENDITURE TOWARDS THE PURCHASE OF SARPAN (FIRE WOOD ) AMOUNTING TO RS.1,48,500/ - . THE ASSESSEE PRODUCED THE ORIGINAL BILL S IN SUPPORT OF THE SAID CLAIM WHICH W ERE ISSUE D BY THE M/S. VIJAY SAW MILL, GANESH ROAD, CHALISGAON. THE ASSESSING OFFICER SUSPECTED THE GENUINENESS OF THE SAID BILLS ON THE BASIS OF HANDWRITING. THE ASSESSING OFFICER ISSUED THE SUMMONS TO ONE SHRI AMRUTL AL PATEL, PROPRIETOR OF M/S. VIJAY SAW MILL, CHALISGAON . I N RESPONSE TO THE SAID SUMMONS HIS SON SHRI HARISH AMRUTLAL PATEL ATTENDED BEFORE THE ASSESSING OFFICER ON 18 - 12 - 2008. THE ASSESSING OFFICER SHOULD PHOTO COPY OF THE BILLS PRODUCED BY THE ASSESSEE AND SHRI HARISH AMRUTLAL PATEL DENIED HAVING ISSUE D BILLS BY M/S. VIJAY SAW MILL. SHRI HARISH AMRUTLAL PATEL ADMITTED THAT DURING THE F.Y. 2005 - 06 , M/S. VIJAY SAW MILL HAD SUPPLIED SARPAN OF RS.5,000/ - ONLY. THE STATEMENT OF SHRI HARISH AMRUTLAL PATEL WAS SHOWN TO THE ASSESSEE AND THE ASSESSEE 3 ITA NO. ITA NO. 749/PN/2010 & CO NO. 35/PN/2011, SHRI AMAR PARMANAND KH ATRI, JALGAON ADMITTED THAT SAME PURCHASE S A S SHOWN BY THE ASSESSEE FROM M/S. VIJAY SAW MILL OF RS.1,48,500/ - ARE NOT GENUINE AND THE SALES SHOWN BY M/S. VIJAY SAW MILL I.E. RS.5,000/ - BE TREATED AS A PURCHASE MADE FROM THE SA ID PARTY. THE ASSESSING OFFICER , THEREFORE , ALLOWED THE AMOUNT OF RS.5,000/ - AND MADE THE ADDITION OF RS.1,4 3 ,500/ - . 4 . THE LD. CIT(A) OBSERVED THAT THE ASSESSING OFFICER DID NOT FOLLOW THE DUE PROCEDURE OBSERVING THE PRINCIPLES OF NATURAL JUSTICE BEFORE COMPLETING THE ASSESSMENT. THERE WAS NO CONCLUSIVE FINDING THAT THE PURCHASE BILLS PRODUCED WERE REALLY FICTITIOUS OR BOGUS IN THE ABSENCE OF PROPER ENQUIRY. THE LD. CIT(A) REDUCED THE DISALLOWANCE BY RS.50,000/ - AND SUSTAINED THE ADDITION TO THE EXTENT OF RS.93,500/ - . THE ASSESSEE OBJECTED FOR SUSTAINING THE SAID AMOUNT OF DISALLOWANCE . 5 . WE HAVE HEARD THE RIVAL SUBMISSIONS OF THE PARTIES AND PERUSED THE RECORD. IN THIS CASE , IT IS SEEN THAT THE SON OF THE PROPRIETOR OF M/S. VIJAY SAW MILL WAS EXA MINED BY THE ASSESSING OFFICER . T HERE IS ONLY ORAL EXAMINATION AND IN THE ORAL EXAMINATION SHRI HARISH AMRUTLAL PATEL DENIED HAVING ISSUE D BILLS TO THE ASSESSEE. AT THE SAME TIME HE ADMITTED THAT THE ASSESSEE H AS PURCHASE D SARPAN FROM THE SAID SAW MILL AS HE STATED TO THE EXTENT OF RS.5,000/ - . A FTER GIVING OUR ANXIOUS CONSIDERATION TO THE ENTIRE FACTS PERTAINING TO THE ISSUE, IN OUR OPINION IF THE DISALLOWANCE IS SUSTAINED TO 25% OF THE TOTAL PURCHASE OF RS.1,48,500/ - THAT WILL MEET THE ENDS OF JUSTICE AS IT IS NOT THE CASE OF ASSESSING OFFICER THAT THE ASSESSEE WAS NOT USING SARPAN (FIRE WOOD ) IN HIS DAIRY BUSINESS. IT IS LIKELY THAT CONSIDERING THE NATURE OF THE FIRE WOOD THE ASSESSEE COULD NOT GET BILLS FOR ENTIRE PURCHASES. WE THEREFORE DIRECT THA T 20% OF RS.1,48,500/ - SHOULD BE DISALLOWED I.E. RS.29,700/ - D ISALLOWED OUT OF THE TOTAL EXPENDITURE OF SARPAN . THE ASSESSING OFFICER IS ACCORDINGLY DIRECT ED TO RESTRICT THE TOTAL ADDITION TO RS.29,700/ - IN 4 ITA NO. ITA NO. 749/PN/2010 & CO NO. 35/PN/2011, SHRI AMAR PARMANAND KH ATRI, JALGAON RESPECT OF THE SARPAN EXPENDITURE. ACCORDINGLY, THE GROUND IS PARTLY ALLOWED. 6 . IN THE RESULT, THE APPEAL PREFERRED BY THE REVENUE IS DISMISSED AND THE CROSS OBJECTION PREFERRED BY THE ASSESSEE IS PARTLY ALLOWED. PRONOUNCED IN THE OPEN COURT ON 21 - 06 - 20 1 3 SD/ - SD/ - ( G.S. PANNU ) ( R.S . PADVEKAR ) ACCOUNTANT MEMBER JUDICIAL MEMBER RK /PS PUNE , DATED : 21 ST JUNE, 20 1 3 COPY TO 1 ASSESSEE 2 DEPARTMENT 3 THE CIT(A) - II, NASHIK 4 THE CIT - II, NASHIK 5 THE DR, ITAT, B BENCH, PUNE . 6 GUARD FILE. //TRUE COPY// BY ORDER PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL PUNE