AVS Poultry Farm & Agro Ltd., New Delhi V. ITO, Ward-1(1), New Delhi

ITA 848/DEL/2019

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 1163 (ITAT-DELHI)
• Duration Of Justice: 10 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-12-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 05-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SARAS KUMAR
• Assessee Lawyers: MRS SURBHI GOYAL
• Keywords: Transactions in derivatives
• Section: 201; 147; 148; 92

Judgement Text

IN TH E INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : SMC : NEW DELHI BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBER ITA NO . 848 /DEL/20 1 9 ASSESSMENT YEAR : 20 1 0 - 11 AVS POULTRY FARM & AGRO LTD., 801, 8 TH FLOOR VISHWA SADAN BUILDING, DISTRICT CENTRE, JANAKPURI, N EW DELHI. PAN: A A FCA5032L VS. ITO, WARD 1(1), NEW DELHI. (APPELLANT ) (RESPONDENT) A SSESSEE BY : SHRI VED JAIN, ADVOCATE & MRS. SURBHI GOYAL, CA RE VENUE BY : SHRI S ARAS KUMAR, SR. DR DATE OF HEARING : 12 . 1 2. 201 9 DAT E OF PRONOUNCEMENT : 18 . 1 2 . 201 9 ORDER TH IS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE EX PARTE ORDER DATED 30 .11. 201 8 OF THE CIT(A) - 1 , N EW DELHI , RELATIN G TO ASSESSMENT YEAR 20 1 0 - 11 . 2 . FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSEE I S A COMPANY ENGAGED IN THE BUSINESS OF SALE AND PURCHASE OF SHARES. IT FILED ITS RETURN OF INCOME ON 7 TH SEPTEMBER, 201 0 DECLARING THE TOTAL INCOME AT RS. 26,36,075/ - . THE RETURN WAS PROCESSED U/S 143(1). SUBSEQUENTLY, ON THE BASIS OF SPECIFIC INFORMATIO N RECEIVED THAT THE ASSESSEE HAS EARNED BOGUS PROFITS BY MISUSING THE CLIENT CODE MODIFICATION FACILITY IN F&O SEGMENT AMOUNTING TO RS.11,36,475/ - , PROCEEDINGS U/S 147 WERE INITIATED AND NOTICE ITA NO. 848 /DEL/201 9 2 U/S 148 OF THE ACT WAS ISSUED. THE AO COMPLETED THE ASSESSMEN T U/S 147/143(3) OF THE ACT DETERMINING THE TOTAL INCOME OF THE ASSESSEE AT RS.37,72,550/ - WHERE HE MADE AN ADDITION OF RS.11,36,475/ - . SINCE NONE APPEARED BEFORE THE CIT(A) DESPITE SUFFICIENT OPPORTUNITIES GRANTED, THE LD.CIT(A), IN THE EX PARTE ORDER PA SSED BY HIM, UPHELD THE ADDITION MADE BY THE AO AND DISMISSED THE APPEAL OF THE ASSESSEE. 3 . AGGRIEVED WITH SUCH ORDER OF THE CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 4 . THE LD. COUNSEL FOR THE ASSESSEE, AT THE OUTSET, SUBMITTED THAT THE AL LEGATION OF THE AO IS THAT THE ASSESSEE HAS NOT DISCLOSED THE PROFIT OF RS.11,36,475/ - WHICH IT HAS EARNED BY MISUSING THE CLIENT CODE MODIFICATION FACILITY IN F&O SEGMENT. REFERRING TO VARIOUS PAGES OF THE PAPER BOOK, HE DREW THE ATTENTION OF THE BENCH T O THE SAME AND SUBMITTED THAT THE ASSESSEE HAS DULY DISCLOSED THE SAME IN HIS AUDITED PROFIT & LOSS ACCOUNT. HE SUBMITTED THAT AS THE LD.CIT(A) HAS DISMISSED THE APPEAL EX PARTE BY SUSTAINING THE ADDITION DUE TO NON - PROSECUTION AND HAS NOT DECIDED THE APP EAL ON MERIT, THE MATTER MAY BE RESTORED TO THE FILE OF THE AO SINCE THE ASSESSEE HAS DULY DISCLOSED THE PROFIT ARISEN OUT OF THE CLIENT CODE MODIFICATION AND, THEREFORE, IT IS CONTRARY TO FACTS AS ALLEGED BY THE AO. 5 . T HE LD. DR HAS NO OBJECTION IF THE MATTER IS RESTORED TO THE FILE OF THE AO. 6 . I HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES, PERUSED THE ORDERS OF THE AO AND THE CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. I ITA NO. 848 /DEL/201 9 3 FIND THAT THE AO IN THE ORDER PASSED U/S 147/143( 3) HAS MADE ADDITION OF RS.11,36,475/ - BEING THE BOGUS PROFIT EARNED BY THE ASSESSEE BY MISUSING THE CLIENT CODE MODIFICATION FACILITY WHICH HAS NOT BEEN DISCLOSED. I FIND THE LD.CIT(A), IN THE EX PARTE ORDER PASSED BY HIM, HAS DISMISSED THE APPEAL OF THE ASSESSEE FOR NON - PROSECUTION AND HAS NOT DECIDED THE APPEAL ON MERIT. IT IS THE SUBMISSION OF THE LD. COUNSEL FOR THE ASSESSEE THAT VARIOUS DETAILS FILED DURING THE COURSE OF ASSESSMENT PROCEEDINGS WERE NOT PROPERLY APPRECIATED BY THE AO AND, THEREFORE, THE MATTER SHOULD BE RESTORED TO THE FILE OF THE AO. CONSIDERING THE TOTALITY OF THE FACTS OF THE CASE AND IN THE INTEREST OF JUSTICE, WE DEEM IT PROPER TO RESTORE THE ISSUE TO THE FILE OF THE AO WITH A DIRECTION TO GRANT ONE MORE OPPORTUNITY TO THE ASSES SEES TO SUBSTANTIATE ITS CASE AND DECIDE THE ISSUE AS PER FACT AND LAW. THE ASSESSEE IS ALSO HEREBY DIRECTED TO APPEAR BEFORE THE AO AND SUBSTANTIATE ITS CASE FAILING WHICH THE AO IS AT LIBERTY TO PASS APPROPRIATE ORDER AS PER LAW. WE HOLD AND DIRECT ACCOR DINGLY. THE GROUNDS RAISED BY THE ASSESSEE ARE ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES. IT IS THE SUBMISSION 7 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES . TH E DECISION WAS PRONOUNCED IN THE OPEN COURT ON 18 . 1 2 . 201 9 . SD/ - ( R. K. PANDA ) ACCOUNTANT MEMBER DATED: 18 TH DECEMBER, 2 01 9 DK ITA NO. 848 /DEL/201 9 4 COPY FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASSTT. REGISTRAR, ITAT, NEW DELHI