ACIT CC 6(4) OLD CC-39, MUMBAI V. T.V UNNIKRISHNAN, MUMBAI

ITA 7656/MUM/2014

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 2312 (ITAT-MUMBAI)
• Duration Of Justice: 11 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-12-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 09-11-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 24-12-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: YASHWANT BHASKAR
• Section: 143(3); 234B

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC MUMBAI BEFORE SHRI A. K. GARODIA, ACCOUNTANT MEMBER. . / ITA NO. 7656/MUM/2014 / ASSESSMENT YEAR 2011-12 THE ACIT, CENTRAL CIRCLE 6 (4), (OLD CC- 39), ROOM NO, 32 (1), GROUND FLOOR, AAYAKAR BHAVAN, M.K.ROAD, MUMBAI - 400020 / VS. SHRI. T.V. UNNIKRISHNAN, 168, 6 TH FLOOR, DCB BUILDING, PALTON ROAD, CRAWFORD MARKET, MUMBAI- 400001. ./ ./ PAN/GIR NO. : AAEPU9261B ( / APPELLANT ) .. ( / RESPONDENT ) CO NO. 178/MUM/2015 ARISNG OUT OF ITA 7656/MUM/14 / ASSESSMENT YEAR 2011-12 SHRI. T.V. UNNIKRISHNAN, 168, 6 TH FLOOR, DCB BUILDING, PALTON ROAD, CRAWFORD MARKET, MUMBAI- 400001. / VS. THE ACIT, CENTRAL CIRCLE 6 (4), (OLD CC- 39), ROOM NO, 32 (1), GROUND FLOOR, AAYAKAR BHAVAN, M.K.ROAD, MUMBAI - 400020 ./ ./ PAN/GIR NO. : AAEPU9261B ( / APPELLANT ) .. ( / RESPONDENT ) APPELLANT BY SHRI YASHWANT BHASKAR RESPONDENT BY : NONE / DATE OF HEARING : 02/12/2015 / DATE OF PRONOUNCEMENT : 04/12/2015 / O R D E R . / ITA NO. 7656/MUM/2014 / ASSESSMENT YEAR 2011-12 CO NO. 178/MUM/2015 ARISNG OUT OF ITA 7656/MUM/14 2 PER A.K.GARODIA, AM: THE APPEAL FILED BY THE REVENUE AND CROSS OBJECTI ON FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF LD CIT (A)-41 MUM BAI, DATED 29.09.2014 FOR ASSESSMENT YEAR 2011-2012. 2. NONE APPEARED ON BEHALF OF THE ASSESSEE IN SPI TE OF NOTICE, HENCE WE PROCEED TO DECIDE THE APPEAL OF THE REVENUE AND THE CO OF THE ASSESSEE EX- PARTE QUA THE ASSESSEE. THE LD DR OF THE REVENUE SU PPORTED THE ASSESSMENT ORDER. 3. FIRST I TAKE UP THE APPEAL FILED BY THE REVENUE . THE GROUNDS RAISED ARE AS UNDER:- 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CA SE THE LD. CIT(A) HAS ERRED IN DIRECTING THE ASSESSING OFFICER TO DELETE THE ADDIT ION OF RS. 25,32,139/-, MADE WITHOUT APPRECIATING THE FACT THAT THE ASSESSED WAS UNABLE TO EXPLAIN THE SAME. THE APPELLANT PRAYS THAT THE ORDER OF COMMISSIO NER OF INCOME-TAX (APPEAL) ON THE ABOVE GROUND BE SET ASIDE AND THAT OF THE ASSES SING OFFICER BE RESTORED. 4. I FIND THAT IT IS NOTED BY THE AO ON PAGE 3 OF THE ASSESSMENT ORDER THAT DURING THE VERIFICATION OF THE BOOKS OF ACCOUNT MAINTAINED IN THE COMPUTER BY THE COMPANY M/S AKBAR TRAVELS OF INDIA PVT. LTD. OF WHICH, THE A SSESSEE IS VICE PRESIDENT, IT WAS SEEN THAT THERE IS A DEBIT BALANCE OF RS. 25, 32,139.2 4 IN UNNIBHAI REFERENCE ACCOUNT. ON PAGE NO. 4 OF THE ASSESSMENT ORDER AO STATED THAT IT WAS REPLIED BY THE ASSESSEE ON QUERY THAT THIS BALANCE HAS BROUGHT FORWARD FROM TH E EARLIER YEARS ORDERS. . / ITA NO. 7656/MUM/2014 / ASSESSMENT YEAR 2011-12 CO NO. 178/MUM/2015 ARISNG OUT OF ITA 7656/MUM/14 3 5. ON PAGE NO. 5 OF THE ASSESSMENT ORDER IN PARA 8. 4, IT IS STATED THAT THE AO THAT IN THE CASE OF UNNIBHAI REF ACCOUNT INVOLVING THE DEBIT B ALANCE OF RS. 25,32,139/-, THE DEBIT BALANCE IS ASSESSED IN THE HANDS OF UNNIBHAI AL IAS SHRI. T.V.UNNIKRISHNAN, VICE PRESIDENT, SUBSTANTIVELY U/S 41(1) IN A.Y. 2011-12. WHEN THE ASSESSEE CARRIED THE MATTER IN THE APPEAL BEFORE THE LD.CIT (A), HE DELET ED THIS ADDITION BY HOLDING THAT THE ASSESSEE HAS SHOWN THIS AMOUNT OF RS. 25,32,139/- IS PAYABLE TO ATIPL, AND HAS NEVER EXPRESSED ANY INTENTION NOT TO HONOUR THE LIABIL ITY WHEN DEMANDED BY ATIPL., THEREAFTER HE NOTED THAT JUST BECAUSE THE OUTSTANDING AMOUNT ARE OLD, IT CANNOT BE SAID THAT THERE IS A CESSATION OF LIABILITY. IN THIS R EGARD, IN MY CONSIDER OPINION, THE JUDGMENT OF HONBLE APEX COURT RENDERED SUGAULI SUGAR , 236 ITR 518 (SC) IS APPLICABLE. IT WAS HELD IN THIS CASE THAT EVEN IF THE ASSESSSEE HAS WRITTEN BACK THE LIABILITY IN ITS BOOKS OF ACCOUNTS, THIS UNILATERAL A CTION OF THE ASSESSEE WILL NOT RESULT INTO CESSATION OF LIABILITY. FURTHER THERE IS AMENDME NT IN U/S 41 (1) AS PER WHICH, IF THE ASSESSEE WRITES BACK THE LIABILITY AND CREDITED THE SAME IN THE PROFIT AND LOSS ACCOUNT, THEN SECTION 41(1) IS APPLICABLE BUT EVEN THE AMENDED SECTION 41 (1) ALSO IS NOT APPLICABLE IN THE PRESENT CASE. THE ASSESSED HAS N OT WRITTEN BACK THE LIABILITY BY CREDITING THE SAME TO PROFIT & LOSS ACCOUNT. 6. HENCE, THERE IS NO DISPUTE IN THE ORDER OF THE LD. CIT (A) WHERE IT IS HELD BY HIM THAT SECTION 41(1) IS NOT APPLICABLE IN THE PRESENT CASE. 7. RESPECTFULLY FOLLOWING THE JUDGMENT OF HONBLE APE X COURT RENDERED IN THE CASE OF SUGAULI SUGAR (SUPRA), I CONFIRM THE ORDER OF THE LD . CIT (A). 8. IN THE RESULT APPEAL OF THE REVENUE IS DISMISSED. 9. NOW I TAKE UP THE CROSS OBJECTION FILED BY THE ASS ESSEE. THE GROUNDS RAISED BY THE ASSESSEE IN THE CROSS OBJECTION ARE AS UNDER:- . / ITA NO. 7656/MUM/2014 / ASSESSMENT YEAR 2011-12 CO NO. 178/MUM/2015 ARISNG OUT OF ITA 7656/MUM/14 4 1. IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW, THE LEARNED ASSESSING OFFICER ERRED IN MAKING ROUTINE ADDITIONS/DISALLOWANCES IN MAKING THE ASSESSMENT U/S 153 A IN RESPECT OF DISCOUNT/HANDLING CHARGES OFFERED BY THE APPELLANT TO THEIR WALK-IN CUSTOMERS, EVEN THOUGH NO INCRIMINATING MATERIAL W AS FOUND DURING THE COURSE OF PRESENT SEARCH IN THIS REGARD AND WITHOUT APPRECIAT ING THE FACT THAT THE ASSESSMENT MADE U/S 143(3) COMPLETED ON THE DATE OF INITIATIO N OF SEARCH DO NOT GET ABATED AS PER THE RATION OF THE JUDGMENT IN THE CASE OF CONTINENT AL WAREHOUSING CORPORATION (NHAVA SHEVA) LTD. (2015) 58 TAXMAN. COM 78 (BOMBAY) 2. IN THE FACTS AND CIRCUMSTANCES OF THE CASE IN LA W, THE LEARNED ASSESSING OFFICER ERRED IN OVERLOOKING THE FACT THAT THE DELETION OF ADDITION IF RS. 25, 32,139/- U/S 41(1) WAS MADE AFTER CONSIDERING THE RECORDS OF THE APPEL LANT AND THAT OF AKBAR TRAVELS OF INDIA P. LTD. WHICH ARE ENTIRELY DIFFERENT ENTITIES . 3. THE A.O. HAS ERRED IN CHARGING INTEREST U/S 234A, 234B, 234C. 10 . IN VIEW OF THE ABOVE DECISION IN RESPECT OF REV ENUES APPEAL AS PER WHICH I CONFIRMED THE ORDER OF THE LD. CIT(A), THE GROUNDS RAISED BY THE ASSESSEE IN CROSS OBJECTION HAVE BECOME OF ACADEMIC INTEREST ONLY BECAUSE OF THE REASONS OF RS. 25,32,139/- HAS BEEN DELETED BY THE LD. CIT (A) AND HIS ORDER UPHELD BY ME. EVEN AS PER THE GROUNDS RAISED BY THE ASSES SEE IN THE CROSS OBJECTION, THERE IS NO OTHER GRIEVANCE OF THE ASSESSEE EXCEPT THE CHARGING OF INTEREST U/S 234A, 234B AND 234C AND ONCE THE ADDITION OF RS. 25 ,32,139/- STANDS DELETED, INTEREST HAS TO BE REDUCED AS A CONSEQUENCE. 11. THEREFORE I HELD THAT THE CROSS OBJECTION OF TH E ASSESSEE HAS BECOME INFRASTRUCTUS AS FACTS DISCUSSED ABOVE, AND, THEREF ORE, THE CROSS OBJECTION IS DISMISSED. 12. IN THE RESULT THE CROSS OBJECTION OF THE ASSES SEE IS DISMISSED. . / ITA NO. 7656/MUM/2014 / ASSESSMENT YEAR 2011-12 CO NO. 178/MUM/2015 ARISNG OUT OF ITA 7656/MUM/14 5 13. IN THE RESULT COMBINE APPEALS OF THE REVENUE A S WELL AS THE CROSS OBJECTION OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 04/12/2015 # $% &' 04/12/2015 SD/- ( A.K.GARODIA) (ACCOUNTANT MEMBER) $ MUMBAI; & DATED: 04/12/2015 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. + ( ) / THE CIT(A)- 4. + / CIT 5. ,- ../0 , /0 , $ / DR, ITAT, MUMBAI 6. 12 / GUARD FILE. / BY ORDER, , . //TRUE COPY// / (DY./ASSTT. REGISTRAR) , $ / ITAT, MUMBAI PRAMILA