M/s R.K.Hotels Pvt. Ltd., Bhopal V. The ACIT 3(1), Bhopal

ITA 83/IND/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 66743 (ITAT-INDORE)
• Duration Of Justice: 8 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2004-2005
• Appeal Filed On: 14-02-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Assessee Lawyers: H P VERMA; GIRISH AGRAWAL
• Keywords: Additional evidence; Initiation of penalty proceedings

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA NO. 83/IND/2012 A.Y. 2004-05 M/S R.K. HOTELS PVT. LTD 243, MP NAGAR, ZONE-I BHOPAL PAN AAACR-8986K :: APPELLANT VS ASSISTANT COMMISSIONER OF INCOME TAX 3(1), BHOPAL :: RESPONDENT APPELLANT BY SHRI H.P. VERMA & GIRISH AGRAWAL RESPONDENT BY SHRI R.A.VERMA, SR. DR DATE OF HEARING 06.11.2012 DATE OF PRONOUNCEMENT 06.11.2012 O R D E R PER JOGINDER SINGH , JUDICIAL MEMBER THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER DAT ED 02.12.2011 PASSED BY THE LD. FIRST APPELLATE AUTHOR ITY, BHOPAL. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS:- 2 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LEARNED C!T(A) ERRED IN SUSTAINING THE ADDITION OF RS. 37,64,026 - BEING UNDISCLOSED INCOME ON ACCOUNT OF SUPPRESSED SALES WITHOUT ACCEPTING THE EXPLANATION OFFERED BY THE ASSESSEE AND WITHOUT APPRECIATING THE FACTS PROPERLY SUBMITTED AT THE TIME OF APPELLATE PROCEEDINGS. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LEARNED C!T(A) ERRED IN CONFIRMING THE ADDITION OF RS. 50,000/- BEING DISALLOWANCE OUT OF TOTAL CROCKERY E XPENSES OF RS. 1,00,445/WITHOUT ACCEPTING THE EXPLANATION O FFERED BY THE ASSESSEE AND WITHOUT APPRECIATING THE FACTS PROPERLY SUBMITTED AT THE TIME OF APPELLATE PROCEEDINGS. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LEARNED C!T(A) ERRED IN CONFIRMING THE ADDITION OF RS. 4,00,000/- BEING DISALLOWANCE OUT OF TOTAL FURNITUR E MAINTENANCE EXPENSES OF RS. 5,20,739/- WITHOUT ACCE PTING THE EXPLANATION OFFERED BY THE ASSESSEE AND WITHOUT APPRECIATING THE FACTS PROPERLY SUBMITTED AT THE TI ME OF APPELLATE PROCEEDINGS. 4. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LEARNED C!T(A) ERRED IN CONFIRMING THE ADDITION OF RS. 2,00,000/- BEING DISALLOWANCE OUT OF TOTAL BUILDING MAINTENANCE EXPENSES OF RS. 2,87,536/- WITHOUT ACCE PTING THE EXPLANATION OFFERED BY THE ASSESSEE AND WITHOUT APPRECIATING THE FACTS PROPERLY SUBMITTED AT THE TI ME OF APPELLATE PROCEEDINGS. 5. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LEARNED CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS. 65,000/- BEING 50% DISALLOWANCE OUT OF TOTAL TAXI COMMISSION EXPENSES OF RS. 1,31,351/- WITHOUT ACCEPTING THE EXPLANATION OFFERED BY THE ASSESSEE AND WITHOUT APPRECIATING THE FACTS PROPERLY SUBMITTED AT THE TI ME OF APPELLATE PROCEEDINGS. 6. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE LEARNED CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS. 2,00,0001- BEING DISALLOWANCE OUT OF TOTAL REPAIRS & MAINTENANCE EXPENSES OF RS. 4,08,705/- WITHOUT ACCEPTING THE EXPLANATION OFFERED BY THE ASSESSEE AND WITHOUT 3 APPRECIATING THE FACTS PROPERLY SUBMITTED AT THE TI ME OF APPELLATE PROCEEDINGS. 7. THAT ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE, INITIATION OF PENALTY PROCEEDINGS U/S 271(1)(C) IS NOT JUSTIFIED. 8. THAT THE APPELLATE CRAVES, LEAVE TO ADD, TO URGE, T O ALTER OR TO AMEND ANY OF THE GROUNDS OF APPEAL ON OR BEFORE THE DATE OF HEARING. 2. DURING HEARING WE HAVE HEARD SHRI H.P. VERMA ALO NGWITH SHRI GIRISH AGRAWAL LD. COUNSEL FOR THE ASSESSEE AN D SHRI R.A. VERMA LD. SR. DR. THE ASSESSEE HAS ALSO FILED PAPER BOOK RUNNING INTO 93 PAGES. THE ASSESSEE HAS ALSO FILED SYNOPSIS. THE CRUX OF ARGUMENTS ON BEHALF OF THE ASSESSEE IS THAT THE RELEVANT RECORD/ DOCUMENTS, ASKED FOR BY THE ASSESSING OFFIC ER, COULD NOT BE SUBMITTED, DURING ASSESSMENT PROCEEDINGS, DUE TO CHANGE IN THE MANAGEMENT AND ONLY COULD BE FILED BEFORE THE L D. CIT (A) WHO SOUGHT THE REMAND REPORT FROM THE ASSESSING OFF ICER. OUR ATTENTION WAS INVITED TO PAGES 80 AND 81 OF THE PAP ER BOOK. ON THE OTHER HAND, THE LD. SR. DR DEFENDED THE IMPUGN ED ORDER BY INVITING OUR ATTENTION TO THE REMAND REPORT SUBMITT ED, BEFORE THE CIT(A), WHEREIN ADMISSION OF ADDITIONAL EVIDENCE WA S STRONGLY OPPOSED AS THE REQUIRED DETAILS WERE NOT FILED BEFO RE THE ASSESSING OFFICER, CONSEQUENTLY, HE COULD NOT 4 EXAMINE SUCH DOCUMENT TO SATISFY HIMSELF. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE MATERIAL ON THE FILE. THE FACTS IN BRIEF ARE THAT T HE ASSESSEE, A PRIVATE LIMITED COMPANY, IS RUNNING A HOTEL IN BHOP AL. FOR THE YEAR, UNDER CONSIDERATION THE ASSESSEE DECLARED LOS S OF RS. 84,83,712/- WHICH INCLUDES LOSS OF RS. 8,14,0,72/-( ASSESSMENT YEAR 2004-05) AND CARRIED FORWARD LOSSES OF RS. 76, 69,640/-. ADDITION OF RS. 46,79,0261 WAS MADE AND THE ASSESSM ENT WAS COMPLETED AT NIL INCOME AFTER SETTING OFF OF CARRIE D FORWARD LOSS OF RS. 38,64,954/- AND THE REMAINING LOSS OF RS. 38,04 ,686/- WAS FURTHER ALLOWED TO BE CARRIED FORWARD. A SEARCH WAS CONDUCTED ON 23.07.2009 AT THE PREMISES OF THE ASSESSEE, THEREFO RE, ASSESSMENT ORDER WAS PASSED U/S 153 A OF THE ACT ON 23.12.2011 WHEREIN THE INCOME WAS COMPUTED AT A LOSS OF RS. 84 ,83,712/-. IF THE TOTALITY OF FACTS AND ASSERTION MADE BY THE LD. RESPECTIVE COUNSEL ARE ANALYZED, ON EVERY GROUND RAISED BEFORE THE LD. CIT(A), THE ASSESSING OFFICER, IN REPLY TO REMAND REPORT HAS MENTIONED THAT THE ASSESSING OFFICER MAY BE PERMITT ED TO VERIFY THE LEDGER AND VOUCHER TO ASCERTAIN THEIR CORRECTNE SS. WITHOUT GOING INTO DELIBERATION THOUGH WE ADMIT THE ADDITIO NAL DOCUMENTS FILED IN THE PAPER BOOK BUT AT THE SAME T IME CANNOT 5 IGNORE THE INTEREST OF REVENUE AS WELL AS OF THE AS SESSEE, THEREFORE, KEEPING IN VIEW THE PRINCIPLE OF NATURA L JUSTICE AND FAIR PLAY REMAND THIS FILE TO THE FILE OF THE LD ASSESSI NG OFFICER TO EXAMINE THE CLAIM OF THE ASSESSEE AFRESH FOR WHICH DUE OPPORTUNITIES OF BEING HEARD BE PROVIDED TO THE ASS ESSEE, CONSEQUENTLY, THIS APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES ONLY. FINALLY THE APPEAL OF THE ASSESSEE IS ALLOWED FOR S TATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT IN THE PRESENCE OF LEARNED REPRESENTATIVES OF BOTH THE SIDES AT THE CONCLUSION OF HEARING ON 06.11.2012. SD SD (R.C.SHARMA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 08.11.2012 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, GU ARD FILE