Poonam Kachalia, Kolkata V. I.T.O Wd - 29(2),kolkata, Kolkata

ITA 764/KOL/2013

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 3310 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 9 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-01-2016
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 10-04-2013
• Court: TRIBUNAL
• Department Lawyers: SHITAL CHANDRA DAS
• Assessee Lawyers: S M SURANA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH SMC, KOLKATA [BEFORE HONBLE SHRI N.V.VASUDEVAN, JM] ITA NO.764/KOL/2013 ASSESSMENT YEAR : 2006-07 POONAM KACHALIA . -VERSUS- I.T.O., WARD-29(2) KOLKATA KOLKATA (PAN:AJCPK 2618 P) (APPELLANT ) (RESPONDENT) FOR THE APPELLANT : SHRI S.M.SURANA, ADVOCATE FOR THE RESPONDENT : SHRI SHITAL CHANDRA DAS, JCI T, SR.DR DATE OF HEARING : 21.12.2015. DATE OF PRONOUNCEMENT : 15.01.2016. ORDER THIS IS AN APPEAL BY THE ASSESSEE AGAIN ST THE ORDER DATED 17.02.2013 OF CIT(A)-XXXVI, KOLKATA RELATING TO A.Y.2006-07. 2. THE ASSESSEE IS AN INDIVIDUAL. HE CARRIES ON BUSINESS OF TRADING IN ELECTRICAL GOODS. IN THE COURSE OF ASSESSMENT PROCEEDINGS AO F OUND THAT HE PAID COMMISSION TO TWO PARTIES NAMELY SMT. DARSHANA KACHALIA AND SMT. KAJAL KACHALIA OF RS.2,95,000/- EACH. AO WANTED TO EXAMINE THE RECIPIENTS OF THE CO MMISSION. ON 19.11.2008, THE RECIPIENTS OF THE COMMISSION WERE EXAMINED BY THE A O ON OATH. AO FOUND THAT BOTH RECIPIENTS OF THE COMMISSION WERE HOUSEWIVES AND WE RE IN NO WAY INVOLVED IN PROCURING CONTRACTS FOR THE ASSESSEE. SINCE NO SERV ICES WERE PROVED WHO HAVE RENDERED FOR WHICH COMMISSION WAS PAID BY THE ASSES SEE, THE AO DISALLOWED A SUM OF RS.5,90,000/- AND ADDED THE SAME TO THE TOTAL INCOM E OF THE ASSESSEE. 2.1. AGGRIEVED BY THE AFORESAID ORDER OF THE A O ASSESSEE PREFERRED APPEAL BEFORE CIT(A). IN THE COURSE OF APPELLATE PROCEEDINGS CIT( A) NOTICED THAT APART FROM COMMISSION PAID TO SMT. DARSHANA KACHALIA AND SMT. KAJAL KACHALIA OF RS.2,95,000/- EACH THE ASSESSEE HAD ALSO PAID COMMI SSION OF RS.2,95,000/- TO ONE ITA NO.764/KOL/2013 POONAM KACHALIA. A.YR.2006-07 2 HITESH KACHALIA AND RS.8,00,000/- TO POPURI MARKETI NG SERVICES. CIT(A) WAS OF THE VIEW THAT EVEN THE COMMISSION IN RESPECT OF THE AFO RESAID TWO PARTIES OUGHT TO HAVE BEEN DISALLOWED BY THE AO AS WAS DONE IN RESPECT OF COMMISSION PAID TO SMT. DARSHANA KACHALIA AND KAJAL KACHALIA. CIT(A) ACCORD INGLY ISSUED AN ENHANCEMENT NOTICE U/S 251(1) OF THE ACT FOR DISALLOWING COMMIS SION OF RS.2,95,000/-. 2.2. THE ASSESSEE IN PROCEEDINGS BEFORE CIT(A) WANTED TO WITHDRAW THE APPEAL CHALLENGING THE DISALLOWANCE OF COMMISSION PAID TO SMT. DARSHANA KACHALIA AND SMT. KAJAL KACHALIA. CIT(A) ISSUED A SHOW CAUSE NOTICE U /S 251(1) OF THE ACT AND TO THE SAID SHOW CAUSE NOTICE THE ASSESSEE HAD NOT SENT AN Y REPLY. IN THE CIRCUMSTANCES CIT(A) CONFIRMED THE ORDER OF AO WITH REGARD TO THE COMMISSION DISALLOWED BY THE AOAND ALSO FURTHER DISALLOWED COMMISSION PAID TO HI TESH KACHALIA AND POPURI MARKETING SERVICES. 3. AGGRIEVED BY THE ORDER OF CIT(A) ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 4. THE LIMITED PLEA OF THE LEARNED COUNSEL FOR THE ASSESSEE WAS THAT AO CONSIDERED THE BOOKS OF ACCOUNT AND SUPPORTING DETAILS AND VOU CHERS PROVIDED IN THE COURSE OF ASSESSMENT PROCEEDINGS AND THEREAFTER COMPLETED THE ASSESSMENT. AO HAS ALSO GONE INTO THE QUESTION WITH REGARD TO THE COMMISSION PAI D BY THE ASSESSEE IN THE COURSE OF HIS BUSINESS. THE AO DID NOT THINK IT FIT TO DISALL OW THE COMMISSION PAID TO HITESH KACHALIA AND POPURI MARKETING SERVICES. THE CIT(A) WITHOUT ANY FURTHER EVIDENCE AND WITHOUT ANY EXAMINATION OF THE CONCERNED PARTIE S CAME TO THE CONCLUSION THAT THE COMMISSION PAID TO THE AFORESAID TWO PARTIES NAMELY HITESH KACHALIA AND POPURI MARKETING SERVICES CANNOT BE ALLOWED AS HE FAILED T O PROVE THE SERVICES RENDERED BY THOSE TWO PARTIES. HE PRAYED FOR ONE MORE OPPORTUNI TY OF PROVIDING THE AFORESAID PARTIES BEFORE THE AO FOR EXAMINATION AND TO PROVE THAT THE COMMISSION WAS PAID TO THE AFORESAID TWO PARTIES FOR THE SERVICES RENDERED . 5. THE LEARNED DR RELIED ON THE ORDER OF AO. ITA NO.764/KOL/2013 POONAM KACHALIA. A.YR.2006-07 3 6. AFTER CONSIDERING THE RIVAL SUBMISSIONS I AM OF THE VIEW THAT THE PLEA MADE BY THE LEARNED COUNSEL FOR THE ASSESSEE IS JUSTIFIED A ND DESERVES ACCEPTANCE. AS RIGHTLY POINTED OUT BY HIM THAT THE CIT(A) COULD HAVE CALLE D FOR REMAND REPORT FROM THE AO DIRECTING THE AO TO EXAMINE HITESH KAKALIA AND POPU RI MARKETING SERVICES TO FIND OUT AS TO WHETHER SERVICES WERE RENDERED BY THESE TWO P ARTIES WITHOUT SUCH EXAMINATION. IN THIS REGARD I ALSO NOTICE THAT PROCEEDINGS BEFOR E CIT(A) ASSESSEE SOUGHT TO WITHDRAW CHALLENGE TO THE DISALLOWANCE OF COMMISSIO N PAID TO SMT. DARSHANA KACHALIA AND SMT. KAJAL KACHALIA. THUS IN THESE CIR CUMSTANCES THE ASSESSEE COULD NOT PRODUCE HITESH KAKALIA AND POPURI MARKETING SERVICE S FOR EXAMINATION OF THE AO. IN MY VIEW IN THE INTEREST OF JUSTICE, THE ASSESSEE S HOULD BE AFFORDED AN OPPORTUNITY TO ESTABLISH HIS CASE. ACCORDINGLY, I SET ASIDE THE OR DER OF THE CIT(A), IN SO FAR AS IT RELATES TO DISALLOWANCES OF COMMISSION PAID TO HITE SH KAKALIA AND POPURI MARKETING SERVICES ARE CONCERNED. THE ASSESSEE HAS TO ESTABLI SH HIS CASE BEFORE AO BY PROVIDING PROPER EVIDENCE. 7. IN THE RESULT THE APPEAL OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 15.01.2016. SD/- [N.V.VASUDEVAN] JUDICIAL MEMBER DATE: 15.01.2016. R.G.(.P.S.) COPY OF THE ORDER FORWARDED TO: 1. POONAM KACHALIA, 36B, DR.RAJENDRA ROD, KOLKATA-7 00025. 2 THE I.T.O., WARD-29(2), KOLKATA.. 3. THE CIT-X, KOLKATA. 4. THE CIT(A)-XXXVI, KOLKATA. 5. DR, KOLKATA BENCHES, KOLKATA TRUE COPY, BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES ITA NO.764/KOL/2013 POONAM KACHALIA. A.YR.2006-07 4