SMT. SAROJ KHANDELWAL, Jaipur V. ITO, Jaipur

ITA 787/JPR/2009

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 7772 (ITAT-JAIPUR)
• Duration Of Justice: 4 year(s) 10 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-09-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2002-2003
• Appeal Filed On: 19-10-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D C SHARMA
• Assessee Lawyers: G M MEHTA
• Keywords: Business expenditure; Opportunity of being heard
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH: JAIPUR (BEFORE SHRI R.P. TOLANI AND SHRI T.R. MEENA) I.T.A. NO. 787/JP/2009 ASSTT. YEAR-2002-03 PAN NO. AGDPK4030H SMT. SAROJ KHANDELWAL, THE I.T.O. E-1-424, CHITRAKUT, VRS. WARD 5(4), JAIPUR. VAISHALI NAGAR, JAIPUR. (APPELLANT) (RESPONDENT) ASSESSEE BY :- SHRI G.M. MEHTA. DEPARTMENT BY :- SHRI D.C. SHARMA. DATE OF HEARING : 13/08/2014 DATE OF PRONOUNCEMENT : 05/09/2014 O R D E R PER: T.R. MEENA, A.M. IN THIS CASE, ORIGINALLY, THE ASSESSEES APPEAL WAS DISMISSED VIDE ORDER DATED 11/3/2010 FOR THE REASON THAT THE ASSESSEE HA D NOT APPEARED BEFORE THIS BENCH, THEREFORE, CASE WAS DECIDED IN LIMINI. TH E ASSESSEE FILED M.A. AGAINST DISMISSAL OF THE APPEAL, WHICH HAS BEEN ALLO WED VIDE ORDER DATED 18 TH JULY, 2014 AND THE ORDER HAS BEEN RECALLED BY THIS BENCH. 2. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST T HE ORDER DATED 04/08/2009 OF THE LEARNED C.I.T.(A)-II, JAIPUR FOR T HE A.Y. 2002-03. THE EFFECTIVE GROUNDS OF APPEAL ARE AS UNDER:- 1. THE LEARNED CIT(A) HAS ERRED IN CONFIRMING ADDITI ON OF RS. 3,78,234/- ON ACCOUNT OF UNDER VALUATION OF CLOSING STOCK BY INVOKING THE PROVISION OF SECTION 145(3) OF THE I.T. ACT, 1961. ITA 787/JP/2009 SAROJ KHANDELWAL VS ITO 2 2. THE LEARNED CIT (A) HAS ERRED IN CONFIRMING ADDITI ON OF RS. 5,00,294/- ON ACCOUNT OF SUPPRESSED SALE VALUE BY I NVOKING THE PROVISION OF SECTION 145(3) OF THE I.T. ACT. 1961. 3. THE LEARNED CIT(A) HAS FURTHER ERRED IN CONFIRMING ADDITION OF RS. 1,40,865/- BY DISALLOWING BROKERAGE EXPENSES. 3. THE LEARNED ASSESSING OFFICER OBSERVED THAT THE A SSESSEE WAS NON- COOPERATIVE AT THE TIME OF SCRUTINY ASSESSMENT. THE ASSESSEE ENGAGED IN THE BUSINESS OF GEMS AND JEWELLERY DURING THE YEAR. THE A SSESSEE DID NOT MAINTAIN STOCK REGISTER FOR THE YEAR UNDER CONSIDERATION. THE G.P. RATE WAS DECLINED COMPARED TO A.Y. 2000-01. THE ASSESSEE HAD NOT PROD UCED BOOKS OF ACCOUNT FOR VERIFICATION TO THE ASSESSING OFFICER. THE LEARN ED ASSESSING OFFICER SCRUTINIZED THE CLOSING STOCK VALUATION, FOUND VARI OUS DISCREPANCIES IN IT. ON THIS BASIS, THE LEARNED ASSESSING OFFICER APPLIED U /S 145(3) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) AND REJECTED THE BOOK RESULT. THE ASSESSEE DID NOT RESPOND WITH VARIOUS OBJECTIONS RAISED BY THE LEARNE D ASSESSING OFFICER DURING THE ASSESSMENT PROCEEDINGS. THEREFORE, HE MADE ADDIT ION UNDER HEAD UNDER VALUATION OF CLOSING OF STOCK OF EMERALD CUT STONE AT RS. 3,78,234/- AND RS. 5,00,294/- ON ACCOUNT OF SUPPRESSED SHARE. FURTHER THE ASSESSEE ALSO CLAIMED BROKERAGE OF RS. 2,81,931/-. THE ASSESSEE HAD NOT SU BMITTED ANY NAME AND ADDRESS OF THE RECIPIENT OF BROKERAGE DURING THE AS SESSMENT PROCEEDINGS AND HAD NOT CORRELATED THE BUSINESS EXPENDITURE WITH SAL E OR PURCHASE. THEREFORE, HE DISALLOWED 50% OF BROKERAGE AT RS. 1,40,865/-. ITA 787/JP/2009 SAROJ KHANDELWAL VS ITO 3 4. BEING AGGRIEVED BY THE ORDER OF THE ASSESSING OF FICER, THE ASSESSEE CARRIED THE MATTER BEFORE THE LEARNED CIT(A), WHO HA D CONFIRMED THE ORDER OF THE LEARNED ASSESSING OFFICER. HE HAS GIVEN DETAIL ED FINDINGS ON ORDER PASSED BY THE LEARNED ASSESSING OFFICER U/S 144 OF THE ACT IN THIS CASE AND JUSTIFIED THE ADDITION UNDER THE THREE HEADS. BEFORE LEARNED CIT(A) ALSO, NO COMPLIANCE WAS MADE BY THE PARTY EVEN VARIOUS DATES PROVIDED BY THE LEARNED CIT(A) TO THE APPELLANT. 5. NOW THE ASSESSEE IS IN APPEAL BEFORE US. 6. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE BEING A LADY AND CHANGE OF VARIOUS A.RS. IN THIS CASE, NO C OORDINATION WAS MADE WITH THE REVENUE AUTHORITIES DURING THE ASSESSMENT PROCE EDINGS AS WELL AS IN THE APPELLATE PROCEEDINGS BEFORE THE LOWER AUTHORITIES. HE HAD ASSURED ON BEHALF OF THE ASSESSEE THAT THERE WILL BE FULL COOPERATION IN FINALIZING THE PROCEEDING BEFORE THE ASSESSING OFFICER AND REQUESTED TO SET A SIDE THE CASE TO THE LEARNED ASSESSING OFFICER. 7. AT THE OUTSET, THE LEARNED DR OPPOSED AND OBJECT ED THAT BEFORE BOTH THE AUTHORITIES, THE ASSESSEE WAS TOTALLY NON-COOPER ATIVE AND HAD NOT PRODUCED RELEVANT BOOKS OF ACCOUNT ALONGWITH OTHER E VIDENCES. THEREFORE, ORDER OF THE LEARNED CIT(A) MAY PLEASED BE CONFIRMED . 8. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. THE INCOME ASSESSE D BY THE LEARNED ASSESSING OFFICER APPEARS TO BE HIGHER SIDE. TO ASSE SS THE ASSESSEES REAL ITA 787/JP/2009 SAROJ KHANDELWAL VS ITO 4 INCOME ON THE BASIS OF EVIDENCE IS MUST, THEREFORE, IN THE INTEREST OF JUSTICE, ONE MORE OPPORTUNITY IS TO BE PROVIDED TO THE ASSES SEE. ACCORDINGLY, WE SET ASIDE THE CASE FOR DE NOVA. THE ASSESSEE IS DIRECTED TO APPEAR WITHIN 20 DAYS BEFORE THE LEARNED ASSESSING OFFICER WITHOUT WAITING THE FORMAL NOTICE FROM HIM. THE ASSESSING OFFICER IS ALSO DIRECTED TO PROVI DE REASONABLE OPPORTUNITY OF BEING HEARD AND DECIDE THE CASE AS PER LAW. 9. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED F OR STATISTICAL PURPOSES ONLY. ORDER PRONOUNCED IN THE OPEN COURT ON 05/09/2014. SD/- SD/- (R.P. TOLANI) (T.R. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER JAIPUR, DATED : 05 TH SEPTEMBER, 2014 * RANJAN COPY FORWARDED TO :- 1. SMT. SAROJ KHANDELWAL, JAIPUR. 2. THE I.T.O., WARD 5(4), JAIPUR. 3. THE CIT (A) 4. THE CIT 5. THE DR GUARD FILE (ITA NO. 787/JP/2009) BY ORDER, AR ITAT JAIPUR.