M/s Surja Ram & Sons, Malout V. The Dy. Commissioner of Income Tax, Bathinda

ITA 8/ASR/2010

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 9590 (ITAT-AMRITSAR)
• Duration Of Justice: 6 year(s) 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 27-07-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 06-01-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P N ARORA
• Keywords: Deemed to accrue or arise in india

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH: AMRITSAR(SMC). BEFORE SH. A.D. JAIN, JUDICIAL MEMBER ITA NO.08(ASR)/2010 ASSESSMENT YEAR: 2006-07 PAN: AACFS7229N M/S. SURJA RAM & SONS, VS. THE DY. COMMR. OF INCOME TAX, MALOUT. CIRCLE-II, BATHINDA; (APPELLANT) (RESPONDENT) APPELLANT BY: SH. P.N. ARORA, ADVOCATE RESPONDENT BY: SH. RAHUL DHAWAN, DR DATE OF HEARING: 27/07/2016 DATE OF PRONOUNCEMENT: 22/08/2016 ORDER THIS IS THE ASSESSEES APPEAL FOR THE ASSESSMENT Y EAR 2006-07, AGAINST THE ORDER, DATED 28.10.2009, PASSED BY THE LD. CIT(A), BATHINDA. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF A PPEAL: 1. THAT THE LD. CIT(A) ERRED BOTH IN LAW AS WELL A S IN RESPECT OF THE FACTS OF THE CASE, WHILE PASSING THE ORDER DATE D 28.10.2009 IN APPEAL NO. 245-IT/CIT(A)/BT/08-09, T HEREBY DISMISSING THE APPEAL. 2. HE FURTHER ERRED IN CONFIRMING THE ADDITION OF R S.9,30,833/- + RS.97,792 MADE BY THE AO AS DEEMED INCOME OF THE FIRM WITHOUT APPRECIATING THE FACTS OF THE CASE JUDICIOU SLY. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS A PARTNERSHIP FIRM HAVING TWO PARTNERS, NAMELY, SH. PARLAD KUMAR AND SH. AMAR KUMAR. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS ASKED TO PRODUCE THE EVIDENCE OF CREDIT IN THE CASE OF BOTH THE PARTNERS. BUT DUE TO DISPUTE AMONGST THE PARTNERS, THE EVIDEN CE OF CREDIT IN THE ITA NO.08(ASR)/2010 A.Y. 2006-07 2 CASE OF SH. PARLAD KUMAR, PARTNER COULD NOT BE PROD UCED FOR WHICH THE ADDITION OF RS.9,30,833/- WAS MADE BY THE AO. SIMI LARLY, THE AO DISALLOWED LABOUR EXPENSES @ 20%, I.E., RS.97,792/- OUT OF CLAIM OF RS.4,88,961/-. ON APPEAL, THE LD. CIT(A) CONFIRMED BOTH THE ADDITIONS MADE BY THE AO. 3. AGGRIEVED WITH THE ORDER OF THE LD. CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THIS BENCH. 4. THE LD. COUNSEL FOR THE ASSESSEE CONTENDED THAT IN THIS CASE THERE WAS DISPUTE AMONGST THE PARTNERS. HE SUBMITTED THAT THIS IS A CASE OF PARTNERSHIP FIRM CONSTITUTED BY SH. PARLAD KUMAR AN D AMAN KUMAR. SH. PARLAD KUMAR DID NOT CO-OPERATE WITH THE PARTNER SH . AMAN KUMAR WHO CONTROLS THE BUSINESS AND THERE WERE SEVERE DIFFERE NCES AMONGST THE PARTNERS. HE FURTHER SUBMITTED THAT DUE TO DISPUTES , THE PARTNERS WERE NOT CO-OPERATIVE WITH EACH OTHER AND AS A RESULT TH E WHOLE BUSINESS WAS NEGLECTED AND NONE OF THE PARTNERS APPEARED BEFORE THE DEPARTMENT TO PRESENT THEIR CASE. THE LD. COUNSEL SUBMITTED THAT IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES, THERE WAS REASONABLE AND S UFFICIENT CAUSE WHICH PREVENTED THE ASSESSEE FROM APPEARING BEFORE THE LD. CIT(A) AND THE LD. CIT(A) WAS NOT JUSTIFIED IN PASSING AN EX-P ARTE ORDER. HE, THEREFORE, PRAYED THAT THE MATTER IN DISPUTE MAY BE RESTORED TO THE FILE OF THE LD. CIT(A) FOR DECIDING THE SAME DENOVO, ON MER ITS. 5. THE LD. DR, ON THE OTHER HAND, RELIED ON THE ORD ERS OF THE AUTHORITIES BELOW. 6. HAVING HEARD THE RIVAL CONTENTIONS IN THE LIGHT OF THE MATERIAL AVAILABLE ON RECORD, I AM OF THE VIEW THAT THE LD. CIT(A) WAS NOT JUSTIFIED ITA NO.08(ASR)/2010 A.Y. 2006-07 3 IN PASSING AN EX-PARTE ORDER, SINCE THERE WAS DISPU TE AMONGST THE PARTNERS. THE LD. COUNSEL FOR THE ASSESSEE IS RIGHT IN CONTENDING THAT DUE TO DISPUTE THE WHOLE BUSINESS WAS NEGLECTED AND NON E OF THE PARTNERS APPEARED BEFORE THE DEPARTMENT TO PRESENT THEIR CAS E. THUS, THE ASSESSEE HAS EXPLAINED THE REASONABLE AND SUFFICIEN T CAUSE WHICH PREVENTED THE ASSESSEE FROM APPEARING BEFORE THE LD . CIT(A). IN VIEW OF THESE FACTS AND CIRCUMSTANCES OF THE CASE, I DEEM I T PROPER TO REMIT THE MATTER IN DISPUTE TO THE FILE OF THE LD. CIT(A) TO BE DECIDED AFRESH, IN ACCORDANCE WITH LAW, AFTER AFFORDING DUE AND ADEQUA TE OPPORTUNITY OF HEARING THE ASSESSEE. THE ASSESSEE, NO DOUBT, SHALL CO-OPERATE IN THE FRESH PROCEEDINGS BEFORE THE A.O. 7. IN THE RESULT, THE APPEAL IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 22/08/ 20 16. SD/- (A.D. JAIN) JUDICIAL MEMBER /SKR/ DATED: 22/08/2016 COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE:M/S. SURJA RAM & BROS., MALOUT. 2. THE DCIT, CIR.II, BATHINDA 3. THE CIT(A), BATHINDA 4. THE CIT, BATHINDA. 5. THE SR DR, ITAT, AMRITSAR. TRUE COPY