BSN MEDICAL P.LTD, MUMBAI V. DCIT 3(1), MUMBAI

ITA 8830/MUM/2011

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 5851 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 2 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-03-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 13-03-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 29-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: DR K SHIVRAM; AJAY R SINGH
• Section: 69C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH B , MUMBAI BEFORE SHRI P.M. JAGTAP , ACCOUNTANT MEMBER AND SHRI SANJAY GARG , JUDICIAL MEMBER ITA NO. 88 30/M/2011 ASSESSMENT YEAR: 2006 - 07 M/S. BSN MEDICAL P. LTD., UNIT NO.501 & 502, 5 TH FLOOR, SEJ PLAZA , MARVE ROAD, MALAD (W), MUMBAI 400 064 PAN: AACCB6297P VS. DCIT 3(1) MUMBAI (APPELLANT) (RESPONDENT) ASSESSEE BY : DR. K. SHIVRAM & SHRI AJAY R. SINGH REVENUE BY : SHRI RAVI PRAKASH DATE OF HEARING : 13.03 .201 4 DATE OF PRONOUNCEMENT : 28.03.2014 O R D E R PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) [(HEREINAFTER REFERRED TO AS CIT(A)] DATED 27.10.11. THE ASSESSEE HAS TAKEN THE FOLLOWING GROUNDS OF APPEAL: ADDITION OF RS. 2,64,59,016/ - : 1. THE LEARNED CIT(A) ERRED IN CONFIRMING THE ORDER OF ASSESSING OFFICER MAKING THE ADDITION OF RS.2,64,59,016/ - ON ACCOUNT OF DIFFERENCE IN (NON - R ECEIPT OF CONFIRMATION PLEASE CHECK) CLOSING ACCOUNTS OF THE PARTY I.E. BEIDERSDORF INDIA PVT. LTD. WITHOUT APPRECIATING THAT THE CONFIRMATION OF THE SAID PARTY ALONG WITH THE LEDGER ACCOUNT WAS FILED BEFORE ASSESSING OFFICER ON 29/12/2008 AND THE BEFORE C IT(A) IN THE COURSE OF APPELLATE PROCEEDING, THEREFORE THE PROVISIONS OF SEC. 69C OF THE ACT IS NOT APPLICABLE AND THE ADDITION MAY BE DELETED. 2. THE LEARNED CIT(A) ERRED IN REJECTING THE SAID LEDGER ACCOUNT OF ITA NO . 8830/M/2011 M/S. BSN MEDICA L P. LTD. 2 THE PARTY I.E. BEIDERSDORF INDIA PVT. LTD . ON THE GROUND THAT IT IS A COMPUTER GENERATED PRINTOUT AND NOT AUTHENTICATE DOCUMENT, WITHOUT APPRECIATING THE CONFIRMATION LETTER DT . 26/11/2008 WHEREIN A REFERENCE IS MADE TO THE SAID LEDGER ACCOUNT. 3. WITHOUT PREJUDICE THE ABOVE IF THE CIT(A) WANT ED A CERTIFIED COPY OF LEDGER ACCOUNT FROM THE SAID PARTY AN OPP ORTUNITY SHOULD HAVE BEEN GRANTED TO THE ASSESSEE TO PRODUCE THE SAME, THE ASSESSEE THEREFORE CRAVES LEAVE TO PRODUCE THE CERTIFIED COPY OF LEDGER ACCOUNT BEFORE THE ITAT. II . ADDITION OF RS. 6,77,159/ - : 4. THE LEARNED CIT(A) ERRED IN CONFIRMING THE PART DISALLOWANCE OF RS. 6, 77,159/ - ON ACCOUNT OF DIFFERENCE IN BALANCE IN RESPECT OF M/S. SMITH & NEPHEW HEALTHCARE PVT. LTD. WITHOUT APPRECIATING THAT THE ASSESSEE HAD FILED THE RECONCILIATION OF THE ACCOUNTS, FURTHER THESE ENTRIES ARE NOT PASSED IN THE BOOKS OF ASSESSEE, THEREFORE, THE PROVISIONS OF SEC. 69C OF THE ACT IS NOT APPLICABLE AND THE ADDITION MAY BE DELETED. 5. THE APPELLANT CRAVES LEAVE TO ADD, AMEND, ALTER OR DE LETE ANY OF THE ABOVE GROUNDS OF APPEAL. 2. A PERUSAL OF THE GROUNDS OF APPEAL REVEALS THAT THE ADDITIONS WERE MADE BY THE ASSESSING OFFICER (HEREINAFTER REFERRED TO AS THE AO) FOR NON RECONCILIATION OF THE ACCOUNTS. 3. THE CONTENTION OF THE LD. A.R. HAS BEEN THAT THE RECONCILIATION WAS FILED BEFORE THE AO BUT HE FAILED TO TAKE NOTE OF THE SAME. HE HAS FURTHER CONTENDED THAT EVEN THE LD. CIT(A) WRONGLY REJECTED THE RECONCILIATION FILED BY THE ASSESSEE HOLDING THAT THE SAME WAS THE COMPUTER GENERATED DOCUMENTS AND WERE NOT DULY SIGNED BY THE CONCERNED PARTIES. HE HAS FURTHER SUBMITTED THAT THE LD. CIT(A) WHILE REJECTING THE SAID COPIES OF THE LEDGER ACCOUNT FAILED TO TAKE NOTE OF THE SEPARATE CONFIRMATIONS FILED BY THE ASSESSEE. THE FURTHER CONTENTIO N OF THE LD. A.R. HAS BEEN THAT EVEN THE AO INSTEAD OF MAKING THE ITA NO . 8830/M/2011 M/S. BSN MEDICA L P. LTD. 3 ADDITION OF THE DIFFERENCE OF THE AMOUNT , WHICH ACCORDING TO HIM WAS NOT RECONCILED, HAS MADE THE ADDITION OF THE ENTIRE OUTSTANDING AMOUNT. ON THE OTHER HAND LD. D.R. HAS RELIED UPON THE FI NDINGS OF THE LOWER AUTHORITIES. 4. WE HAVE CONSIDERED THE RESPECTIVE SUBMISSIONS OF THE LD. REPRESENTATIVES OF THE PARTIES. THE UNDISPUTED FACT IS THAT THE DISPUTED ADDITIONS HAVE BEEN MADE IN THE CASE OF THE ASSESSEE DUE TO DIFFERENCE OF THE RECONCIL IATION STATEMENTS. THE STAND OF THE ASSESSEE IS THAT THE STATEMENTS WERE RECONCILED NOT ONLY BEFORE THE AO BUT ALSO BEFORE THE LD. CIT(A). BUT THE LD. CIT(A) HAS FAILED TO LOOK INTO THE DOCUMENTS FILED BEFORE HIM. 5. IN OUR VIEW, THE STRAIGHTAWAY REJEC TING OF THE LEDGER ACCOUNTS BY THE LD. CIT(A) WAS NOT JUSTIFIED. IF THE LD. CIT(A) HAD ANY DOUBT ABOUT THE AUTHENTICITY OF THE DOCUMENTS IN QUESTION HE COULD HAVE VERIFIED THE SAME FROM THE CONCERNED PARTIES . EVEN OTHERWISE, W HILE REFUSING TO TAKE INTO C ONSIDERATION THE RELEVANT DOCUMENTS WHICH WERE VERY MUCH NECESSARY FOR THE JUST DECISION OF THE CASE, LEARNED CIT(A) FAILED TO EXERCISE HIS APPELLATE JURISDICTION U/S 250 OF THE ACT. THE DUTY WAS ALSO CAST UPON THE LEARNED CIT(A) TO ADMIT AND CONSIDER THE EVIDENCE PRODUCED BEFORE HIM BY THE ASSESSEE. THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF SMT. PRABHAVATI S.SHAH V. CIT [(1998) 231 ITR 1 (BOM.)] HAS HELD THAT THE POWERS CONFERRED ON THE FIRST APPELLATE AUTHORITY UNDER SUB - SECTION (4) OF SECTION 250 OF THE ACT, BEING A QUASI - JUDICIAL POWER, IT IS INCUMBENT ON HIM TO EXERCISE THE SAME, IF THE FACTS AND CIRCUMSTANCES JUSTIFY. EVEN OTHERWISE UNDER RULE 46A(4) OF THE INCOME TAX RULES , THE CIT(A) HAS BEEN GIVEN POWER TO CALL FOR PRODUCTION OF ANY DOCUMENT O R THE EXAMINATION OF ANY WITNESSES TO ENABLE HIM TO DISPOSE OF THE APPEAL. THERE IS NO DOUBT ABOUT THE LEGAL POSITION THAT IF ANY DOCUMENT FURNISHED BY THE ASSESSEE BEFORE THE COMMISSIONER (APPEALS) IS IN THE NATURE OF CLINCHING EVIDENCE WHICH GOES TO ITA NO . 8830/M/2011 M/S. BSN MEDICA L P. LTD. 4 THE ROOT OF THE CASE THEN IN THE INTEREST OF JUSTICE SUCH TYPES OF EVIDENCE SHOULD NOT BE REJECTED. 6. HENCE, IN OUR VIEW, THE INTEREST OF JUSTICE WILL BE BETTER SERVED IF THE MATTER REMANDED BACK TO THE AO TO VERIFY THE LEDGER ACCOUNT STATEMENTS, CONFIRMAT IONS ETC. AND THEREAFTER TO DECIDE THE MATTER ACCORDINGLY. NEEDLESS TO SAY THAT THE AO WILL GIVE PROPER OPPORTUNITY TO THE ASSESSEE TO REPRESENT ITS CASE. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 28.03. 201 4 . SD/ - SD/ - ( P.M. JAGTAP ) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 28.03.2014 * KIS HORE COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT ( A) CONCERNED, MUMBAI THE DR C BENCH //TRUE COPY// [ BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.