Nandalal Dey, Hooghly V. ITO, WD-1, BANKURA, Bankura

ITA 898/KOL/2015

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 1530 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 7 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-02-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 19-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARINDAM BHATTACHARJEE
• Keywords: Corroborative evidences
• Section: 143(3)

Judgement Text

1 ITA NO.898/KOL/2015 NANDA LAL DEY, AY- 2011-12 , D , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH: KOL KATA ( ) BEFORE . , /AND . . , ) [BEFORE SHRI J. SUDHAKAR REDDY, AM & SHRI A. T. VARKEY, JM] I.T.A. NO. 898/KOL/2015 ASSESSMENT YEAR: 2011-12 NANDA LAL DEY (PAN: AIJPD2089D) VS. INCOME-TAX OFFI CER, WARD-1, BANKURA APPELLANT RESPONDENT DATE OF HEARING 23.01.2018 DATE OF PRONOUNCEMENT 15.02.2018 FOR THE APPELLANT SHRI SOMNATH GHOSH, ADVOCATE FOR THE RESPONDENT SHRI ARINDAM BHATTACHARJEE, ADDL . CIT, SR.DR ORDER PER SHRI A.T.VARKEY, JM THE APPEAL FILED BY THE ASSESSEE IS AGAINST THE ORD ER OF LD. CIT(A)-DURGAPUR DATED 21.04.2015 FOR AY 2011-12 WHEREBY HE CONFIRMED THE PENALTY U/S. 271A OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) AG AINST THE ASSESSEE. 2. BRIEF FACTS OF THE CASE ARE THAT ASSESSEE IS TRADING IN WHOLESALE AND RETAIL OF EGGS. CASE WAS SELECTED FOR SCRUTINY AND DURING THE ASSES SMENT PROCEEDINGS THE AO FOUND FAULT WITH THE ASSESSEE NOT ABLE TO PRODUCE PURCHASE BILL S, VOUCHERS ETC. TO SUPPORT THE EXPENDITURE. THEREAFTER, HE WAS OF THE VIEW WITHO UT SUPPORTING EVIDENCE, CORRECTNESS AND COMPLETENESS OF THE PAPER, AND BOOK OF ACCOUNTS SUB MITTED BY THE ASSESSEE AS WELL AS IN ABSENCE OF SUPPORTING EVIDENCE THE PAPER BOOK IS NO T ACCEPTABLE AND HE MADE THE DIFFERENCE OF PURCHASES AS THE UNDISCLOSED PURCHASES AND GROSS PROFIT @ 2.99% WAS ADDED ON THAT ALSO. NET PROFIT WAS ESTIMATED @ 8% ON THE SUM OF RS.4,80,05,648/- AND NET TAXABLE INCOME WAS COMPUTED AT RS.38,16,005/-. THEREAFTER, THE AO INITIATED PENALTY PROCEEDINGS 2 ITA NO.898/KOL/2015 NANDA LAL DEY, AY- 2011-12 U/S. 271A OF THE ACT FOR NON-MAINTENANCE OF BOOKS O F ACCOUNT AS REQUIRED BY SEC. 44A OF THE ACT AND THE RULES MADE THERE UNDER AND WAS PLEA SED TO LEVY PENALTY OF RS.25,000/-. AGGRIEVED, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A), WHO WAS PLEASED TO CONFIRM THE SAME. AGGRIEVED, THE ASSESSEE IS BEFOR E US. 3. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THRO UGH FACTS AND CIRCUMSTANCES OF THE CASE. WE NOTE THAT DURING ASSESSMENT PROCEEDINGS T HE ASSESSEE HAS FILED COPY OF AUDITED ACCOUNTS, COPIES OF ALL BANK STATEMENTS ETC. FOR TH E ASSESSMENT YEAR UNDER CONSIDERATION. THE AO HAS CLEARLY STATED IN PAGE 3 OF THE ASSESSME NT ORDER THAT HE HAD VERIFIED PURCHASE REGISTER, LEDGER, BOOKS OF ACCOUNTS ETC. AND HAS AL SO GONE THROUGH THE SALES REGISTER AND AUDITED BOOKS OF ACCOUNTS. HE HAS ALSO STATED THAT ON 21.02.2014 THE LD. AR OF THE ASSESSEE APPEARED AND SUBMITTED PAPER BOOKS OF ACCO UNT, POSTAL ADDRESS OF SUNDRY CREDITORS AND STATEMENT REGARDING NAMES AND ADDRESSES OF THE SUNDRY TRADERS. IN THE PENALTY ORDER, THE AO FOUND FAULT WITH THE ASSESSEE FOR NOT PRODUC ING THE SUPPORTING DOCUMENTS TO CROSS VERIFY THE ENTRIES IN THE BOOKS. THE AO HAS FAILED TO SPECIFY AS TO WHICH BOOKS OF ACCOUNTS LIKE LEDGER, CASH BOOK, BANK BOOK HAS NOT BEEN PROD UCED BEFORE HIM. THE ASSESSMENT ORDER PASSED BY THE AO IS VAGUE AND FROM THE READING OF T HE ASSESSMENT ORDER AS WELL AS THE PENALTY ORDER, WE NOTE THAT THE AO HAS NOT SPECIFIC ALLY STATED WHICH BOOKS WERE STATUTORILY REQUIRED TO BE MAINTAINED BY THE ASSESSEE, WHICH TH E ASSESSEE HAS FAILED TO MAINTAIN AND WITHOUT MAKING A SPECIFIC CHARGE OR DEFAULT, THE PE NALTY CANNOT BE LEVIED. HAVING SAID SO, WE ALSO NOTE THAT IF THE ASSESSEE IS NOT ABLE TO PR ODUCE VOUCHERS OR BILLS IN SUPPORT OF ITS CLAIM FOR EXPENDITURE THEN THE AO IS AT LIBERTY NOT TO ALLOW THE CLAIMS OF EXPENDITURE MADE BY THE ASSESSEE. HOWEVER, IF A PENALTY U/S. 271A O F THE ACT IS TO BE LEVIED THEN THE AO HAS TO MAKE OUT A CASE THAT ASSESSEE WAS STATUTORILY RE QUIRED TO MAINTAIN BOOKS IN THE COURSE OF HIS BUSINESS, WHICH THE ASSESSEE HAS FAILED TO KEEP AND MAINTAIN AND OTHER DOCUMENTS WHICH ARE REQUIRED TO BE MAINTAINED AS PER SECTION 44AA OF THE ACT OR RULES MADE THERE UNDER AND TO RETAIN SUCH BOOKS OF ACCOUNT AND OTHER DOCUMENTS FOR THE PERIOD SPECIFIED IN THE RULES. HERE, IN THIS CASE, THE AO FAILED TO SP ECIFY WHICH BOOKS THE ASSESSEE HAS NOT KEPT AND MAINTAINED AS PER LAW AND RULES MADE THERE UNDER. WE NOTE THAT IN THE INSTANT CASE, THE ASSESSEE HAS PRODUCED THE AUDITED BOOKS, PURCHA SE REGISTER, SALES REGISTER, LEDGER, BANK 3 ITA NO.898/KOL/2015 NANDA LAL DEY, AY- 2011-12 STATEMENT, PAPER BOOKS OF ACCOUNT ETC. AND THE ASSE SSMENT HAS BEEN DONE U/S. 143(3) OF THE ACT AS NOTED FROM THE TITLE OF THE ASSESSMENT ORDER AS ITEM NO. 13. IN THE SAID SCENARIO, PENALTY LEVIED U/S. 271A OF THE ACT IS NOT LEGALLY SUSTAINABLE AND, THEREFORE, WE DIRECT THE DELETION OF THE SAME. APPEAL OF ASSESSEE IS ALLOWED . 4. IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED. ORDER IS PRONOUNCED IN THE OPEN COURT ON 15.02.2018 SD/- SD/- (J. SUDHAKAR REDDY) (ABY. T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 15TH FEBRUARY, 2018 JD.(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1. APPELLANT SHRI NANDA LAL DEY, C/O, S. N. GHOSH & ASSOCIATES, ADVOCATES, SEVEN BROTHERS LODGE,, P.O. BUROSHIBTA LA, P.S. CHINSURAH, DIST. HOOGHLY, PIN-712 105. 2 RESPONDENT ITO, WARD-1, BANKURA. 3. THE CIT(A) DURGAPUR 4. 5. CIT DURGAPUR DR , ITAT, KOLKATA. / TRUE COPY, BY ORDER, SR. PVT. SECRETARY