Dipak Parui, Kolkata V. JCIT, R-53, KOLKATA, Kolkata

ITA 767/KOL/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 5855 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 2 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-07-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2011-2012
• Appeal Filed On: 22-04-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SAURABH KUMAR
• Assessee Lawyers: MANOJ TIWARI
• Keywords: Unexplained cash credit; Retrospective amendment
• Section: 143(3); 68

Judgement Text

ITA NO.767/KOL/2016 DIPAK PARUI A.Y.2011-12 1 IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH C KOL KATA [BEFORE HONBLE SHRI S.S.GODARA, JM & DR.A.L.SAIN I, AM ] ITA NO.767/KOL/2016 ASSESSMENT YEAR : 2011-12 DIPAK PARUI -VERSUS- J.C.I.T., RANGE-53, KOLKATA KOLKATA (PAN: AOGPP 5076 F) (APPELLANT) (RESPONDENT) FOR THE APPELLANT: SHRI MANOJ TIWARI, AR FOR THE RESPONDENT: SHRI SAURABH KUMAR, ADDL. CIT, SR.DR DATE OF HEARING : 11.07..2018. DATE OF PRONOUNCEMENT : 20.07.2018 ORDER PER S.S.GODARA, JM: THIS ASSESSEES APPEAL FOR A.Y.2011-12 ARISES AGA INST THE CIT(A)-7, KOLKATAS ORDER DATED 23.02.2016 PASSED IN APPEAL NO.556/CIT (A)-7/KOL/R-26/14-15 UPHOLDING THE ASSESSING OFFICERS ACTION ADDING ITS CUSTOMERS ADVANCES OF RS.9,77,500/- AS WELL AS DISALLOWANCE OF EXPENDITUR E CLAIMED OF RS.1,79,800/- U/S 40(A)(IA) ON ACCOUNT OF NON DEDUCTION OF TDS; RESPE CTIVELY INVOLVING PROCEEDINGS U/S 143(3) OF THE INCOME TAX ACT, 1961 (ACT). HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. WE COME TO THE FORMER ISSUE OF SECTION 68 UNEXPL AINED CASH CREDITS OF RS.9,77,500/-. IT EMERGES THAT THE ASSESSING OFFICE R HAD ADDED ASSESSEES CUSTOMERS ADVANCES OF RS.51,76,237/- BY TERMING THE SAME TO B E BOTH NON GENUINE AS WELL AS SUPPRESSED REVENUE RECEIPTS CESSATION OF LIABILITY U/S 41(1) OF THE ACT. THE ASSESSEE PREFERRED APPEAL. IT FILED ADDITIONAL SUBMISSIONS D URING THE COURSE OF LOWER APPELLATE PROCEEDINGS. THE CIT(A) SOUGHT FOR REMAND REPORT. T HE ASSESSING OFFICER SUBMITTED THE SAME. IT TRANSPIRES THEREFROM THAT AN AMOUNT OF RS.41,98,737/- REPRESENTED OPENING BALANCE OF ASSESSEES CUSTOMERS ADVANCES. THE CIT(A) THEREFORE CONCLUDES THAT THE SAID ADDITION OF OUTSTANDING ADVANCE COULD NOT BE MADE IN THE IMPUGNED ITA NO.767/KOL/2016 DIPAK PARUI A.Y.2011-12 2 ASSESSMENT YEAR. COMING TO THE LATTER COMPONENT OF RS.9,77,500/- OF ADVANCE RECEIVED DURING THE YEAR, HE HAS INVOKED SECTION 68 TO TREAT THE SUM AS UNEXPLAINED CASH CREDITS LIABLE TO BE ADDED. 3. WE HAVE HEARD BOTH THE PARTIES REITERATING THEI R RESPECTIVE STANDS AGAINST AND IN FAVOUR OF THE IMPUGNED ADDITION. THERE IS NO DISPUT E THAT THE ASSESSING AUTHORITY HAD NOWHERE INVOKED SECTION 68 OF THE ACT SO FAR AS THE IMPUGNED CUSTOMERS ADVANCE OF RS.RS.51,76,237/- ARE CONCERNED IN PARTICULAR. HE H AD MADE THIS ADDITION BY HOLDING THAT CORRESPONDING LIABILITY TOWARDS THE CUSTOMERS HAD CEASED TO EXIST IN THE IMPUGNED ASSESSMENT YEAR. IT IS THEREFORE CLEAR THAT THE CIT (A) HAS APPLIED SECTION 68 OF THE ACT QUA THE REMAINING ADVANCES WHICH COULD NOT BE EXPLA INED IN THE REMAND PROCEEDINGS. THE ASSESSEE HAS NOWHERE BEEN PUT TO NOTICE BEFORE INVOKING SECTION 68 OF THE ACT DURING COURSE OF LOWER APPELLATE PROCEEDINGS. THER E IS NO FURTHER ISSUE THAT SECTION 41(1) OF THE ACT APPLIES IN THE CASE OF OUTSTANDING ADVANCES CARRIED FORWARD FROM THE PRECEDING ASSESSMENT YEARS WHICH ARE EITHER REMITTE D AS A CASE OF CESSATION OF LIABILITY IN THE IMPUGNED ASSESSMENT YEAR. WE THEREFORE FIND NO MERIT IN THE IMPUGNED ADDITION OF RS.9,77,500/- CONVERTED FROM CESSATION OF LIABILITY TO UNEXPLAINED CASH CREDITS FOR THIS ASSESSMENT YEAR. THE SAME STANDS DELETED ACCORDINGLY. 5. LATTER ISSUE BEFORE US IS THAT OF CORRECTNESS OF SECTION 40 (A)(IA) DISALLOWANCE OF RS.1.79,800/- OUT OF ASSESSEES TOTAL CLAIM OF RS., 3,05,364/-. HIS ONLY ARGUMENT BEFORE US IS THAT SECTION 40(A)(IA) AS AMENDED BY FINANCE ACT 2014 W.E.F. 01.04.2015 PRESCRIBING SUCH DISALLOWANCE TO BE RESTRICTED TO 3 0% ONLY THAN THE ENTIRE AMOUNT OF RS.1,79,800/-; APPLIES WITH RETROSPECTIVE EFFECT. LEARNED DEPARTMENTAL REPRESENTATIVE VEHEMENTLY OPPOSES THIS LEGAL PLEA. HE PLEADS THAT THE SAID PROVISO DOES NOT CARRY ANY RETROSPECTIVE EFFECT. WE FIND NO FORCE IN REVENUES INSTANT ARGUMENTS AS A COORDINATE BENCH OF THIS TRIBUNAL IN SHRI RAJENDRA YADAV IN IT A NO.895/JP/2012 DECIDED ON 29.01.2016 ALREADY CONCLUDES THE ABOVE AMENDMENT W. E.F. 01.04.2015 TO BE RETROSPECTIVE EFFECT BEING CURATIVE IN NATURE. WE T HEREFORE DIRECT THE ASSESSING OFFICER TO RESTRICT THE IMPUGNED DISALLOWANCE TO 30% ONLY T O BE FOLLOWED BY NECESSARY ITA NO.767/KOL/2016 DIPAK PARUI A.Y.2011-12 3 COMPUTATION AS PER LAW. THIS LATTER SUBSTANTIVE GRO UND IS TREATED AS PARTLY ACCEPTED IN ABOVE TERMS. 6. THIS ASSESSEES APPEAL IS ALLOWED FOR STATISTICA L PURPOSES. O RDER PRONOUNCED IN THE COURT ON 20.07.2018. SD/- SD/- [DR.A.L.SAINI ] [ S.S.GODARA ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 20.07.2018. [RG SR.PS] COPY OF THE ORDER FORWARDED TO: 1.DIPAK PARUI, 129, UDYAN PALLY, RAKSHIT PARA ROAD, GREEN PARK, SARSUNA, BEHALA, KOLKATA-700061. 2. J.C.I.T., RANGE-53, KOLKATA. 3. C.I.T.(A)-7, KOLKATA 4. C.I.T-9, KOLKATA 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER, SENIOR PRIVATE SECRETARY HEAD OF OFFICE/D.D.O, ITAT KOLKATA BENCHES ITA NO.767/KOL/2016 DIPAK PARUI A.Y.2011-12 4