Tirupati Computers & Stationers P.Ltd., V. Dy.CIT, Cir-3(2), Aurangabad,

ITA 929/PUN/2007

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 7678 (ITAT-PUNE)
• Duration Of Justice: 3 year(s) 6 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-01-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 1994-1995
• Appeal Filed On: 06-07-2007
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: HEMANTKUMAR C LEUVA
• Keywords: Depreciation
• Section: 143(3); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER AND SHRI G.S. PANNU, ACCOUNTANT MEMBER ITA NO. 929/PN/07 (ASSTT YEAR:1994-95) M/S TIRUPATI COMPUTERS & STATIONERS P.LTD., AURANGABAD .. APPELLANT PAN AABCT3918N VS. DY. COMMISSIONER OF INCOME-TAX, CIR.3(2), AURANGABAD .. RESPONDENT APPELLANT BY : SHRI M K KULKARNI RESPONDENT BY : SHRI HEMANT KUMAR C LEUVA ORDER PER G.S. PANNU, A.M: THIS APPEAL BY ASSESSEE IS DIRECTED AGAINST THE OR DER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-I, AURANGABAD DATED 30.3.2007 WHICH, IN TURN, HAS ARISEN FROM AN ORDER DATED 27.3 .1997 PASSED BY THE ASSESSING OFFICER UNDER SECTION 143(3) OF THE INCOM E-TAX ACT, 1961 (IN SHORT THE ACT) PERTAINING TO THE ASSESSMENT YEAR 1994-95. 2. ALTHOUGH THE ASSESSEE HAS RAISED MULTIPLE GROUND S OF APPEAL IN THE MEMO OF APPEAL, ESSENTIAL GRIEVANCE IS ON TWO COUNT S. FIRSTLY, ASSESSEE IS AGGRIEVED WITH AN ADDITION OF RS 6,75,630/- SUST AINED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) ON ACCOUNT OF UNPROVED LOANS. THE SECOND GRIEVANCE IS WITH THE ACTION OF THE COMMISSI ONER OF INCOME-TAX (APPEALS) IN NOT CONSIDERING THE CLAIM OF DEPRECIAT ION OF RS 7,51,786/-. ITA NO 929/PN/07 M/S TIRUPATI COMPUTERS & STATIONERS P LTD, AURANGABAD 2 3. IN THIS BACKGROUND, THE RIVAL COUNSELS HAVE MADE THEIR SUBMISSIONS. THE FIRST AND FOREMOST SUBMISSION OF THE ASSESSEE IN REGARD TO THE ADDITION OF UNPROVED LOANS IS THAT THE SAME DOES NOT PERTAIN TO THE YEAR UNDER CONSIDERATION. WITH REFERENCE TO PAGE 10 OF THE PAPER BOOK, WHICH IS A CHART DETAILING THE LOANS OF RS 6,75,630 /- RECEIVED FROM FIVE CREDITORS, IT IS SOUGHT TO BE EXPLAINED THAT THE AD DITIONS MADE ARE OUT OF BALANCES WHICH ARE BROUGHT FORWARD FROM THE PRECEDI NG YEAR. IT IS ALSO POINTED OUT WITH REFERENCE TO THE REMAND REPORT OF THE ASSESSING OFFICER DATED 14.3.2007 ADDRESSED TO THE COMMISSIONER OF I NCOME-TAX (APPEALS) THAT SUCH FACT POSITION HAS BEEN ALSO NOTICED BY TH E ASSESSING OFFICER. THEREFORE, IT WAS CONTENDED THAT THE PROVISIONS OF SECTION 68 OF THE ACT TO TREAT THE AFORESAID CASH CREDITS AS UNEXPLAINED CAN NOT BE INVOKED WITH REFERENCE TO THE ASSESSMENT YEAR UNDER CONSIDERATIO N, AS THE SAID AMOUNTS HAVE NOT BEEN RECEIVED DURING THE YEAR. 4. ON THE OTHER HAND, THE LEARNED DEPARTMENTAL REPR ESENTATIVE, APPEARING FOR THE REVENUE, SUBMITTED THAT THE COMMI SSIONER OF INCOME- TAX (APPEALS) HAS NOTED THAT THE ASSESSEE HAS FAILE D TO FILE THE CONFIRMATION FROM THE PARTIES SO AS TO PROVE THE LO ANS AND IN THE ABSENCE OF SUCH AN EVIDENCE, THERE WAS NO OPTION BUT TO CON FIRM THE ADDITION IN THE YEAR UNDER CONSIDERATION. IN THIS MANNER, THE ADDIT ION HAS BEEN SOUGHT TO BE DEFENDED. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFUL LY. UNDOUBTEDLY, SECTION 68 OF THE ACT CASTS AN ONUS ON THE ASSESSEE TO EXPLAIN THE NATURE AND SOURCE OF A SUM FOUND CREDITED IN THE ACCOUNT B OOKS OF AN ASSESSEE. THE SHORT POINT RAISED BY THE ASSESSEE IS THAT THE CASH CREDITS IN QUESTION ARE MERELY BROUGHT FORWARD BALANCES FROM EARLIER YE AR AND, THEREFORE, THE SAME CANNOT BE CONSTRUED AS SUMS FOUND CREDITED FOR THE PURPOSES OF ITA NO 929/PN/07 M/S TIRUPATI COMPUTERS & STATIONERS P LTD, AURANGABAD 3 SECTION 68 OF THE ACT IN THE INSTANT ASSESSMENT YEA R. FACTUALLY SPEAKING, THERE IS NO DISPUTE THAT THE ASSESSEE HAD PLEADED S O BEFORE THE LOWER AUTHORITIES AND, THE SAME HAS ALSO BEEN ACCEPTED BY THE ASSESSING OFFICER IN HIS REMAND REPORT DATED 14.3.2007, COPY OF WHICH IS ON RECORD. IN SUCH A SITUATION, THE ONUS ON THE ASSESSEE TO EX PLAIN THE NATURE AND SOURCE OF THE CREDITS AS MANDATED BY SECTION 68 OF THE ACT, DOES NOT DEVOLVE ON THE ASSESSEE FOR THE YEAR UNDER CONSIDER ATION. AS A RESULT, THE FAILURE OF THE ASSESSEE TO DISCHARGE SUCH ONUS, WOU LD NOT LEAD TO AN ADDITION FOR THE YEAR UNDER CONSIDERATION AND, ACCO RDINGLY THE SAME IS LIABLE TO BE DELETED. WE HOLD SO. THUS, ON THIS GRO UND THE ASSESSEE SUCCEEDS. 6. THE NEXT GROUND IS WITH REGARD TO THE CLAIM OF D EPRECIATION OF RS 7,51,786/-, WHICH AS PER THE APPELLANT, HAS NOT BEE N ADJUDICATED BY THE COMMISSIONER OF INCOME-TAX (APPEALS). THE LEARNED C OUNSEL FOR THE ASSESSEE POINTED OUT THAT THE SAID CLAIM WAS MADE F OR THE FIRST TIME BEFORE THE COMMISSIONER OF INCOME-TAX (APPEALS) AND, IN TH IS REGARD, OUR ATTENTION WAS INVITED TO PAGE 6 OF THE WRITTEN SUBM ISSIONS FILED BEFORE THE COMMISSIONER OF INCOME-TAX (APPEALS). IT IS ALSO PO INTED OUT THAT IN THE REMAND REPORT OF THE ASSESSING OFFICER DATED 14.3.2 007 SUBMITTED TO THE COMMISSIONER OF INCOME-TAX (APPEALS), THE RAISING O F SUCH A CLAIM BY THE ASSESSEE HAS BEEN ACKNOWLEDGED. THUS, ACCORDING TO THE LEARNED COUNSEL, NON-ADJUDICATION OF THE SAID CLAIM BY THE COMMISSIONER OF INCOME-TAX (APPEALS) HAS RENDERED THE IMPUGNED ORDE R AS UNSUSTAINABLE. 7. THE AFORESAID FACTUAL ASPECT HAS NOT BEEN CONTES TED BY THE LEARNED DEPARTMENTAL REPRESENTATIVE, ALTHOUGH HE HAS CONTEN DED THAT IN THE ABSENCE OF ANY SPECIFIC GROUND OF APPEAL RAISED BEF ORE THE COMMISSIONER ITA NO 929/PN/07 M/S TIRUPATI COMPUTERS & STATIONERS P LTD, AURANGABAD 4 OF INCOME-TAX (APPEALS), SAID CLAIM WAS NOT ENTERTA INABLE BEFORE THE COMMISSIONER OF INCOME-TAX (APPEALS). 8. ON THIS ISSUE, IT CLEARLY EMERGES THAT THE ASSES SEE TOOK UP THE PLEA OF DEPRECIATION BEFORE THE COMMISSIONER OF INCOME-T AX (APPEALS) AND, SUCH A PLEA HAS NOT BEEN ADDRESSED BY THE COMMISSIO NER OF INCOME-TAX (APPEALS). THE COMMISSIONER OF INCOME-TAX (APPEALS) HAS NOT PASSED A SPEAKING ORDER ON THIS ASPECT OF THE ISSUE AND, THE REFORE, WE DEEM IT FIT AND PROPER TO RESTORE THIS MATTER TO THE FILE OF TH E COMMISSIONER OF INCOME-TAX (APPEALS) TO BE ADJUDICATED IN ACCORDANC E WITH LAW, AFTER ALLOWING A REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. THUS, ON THIS ASPECT, THE ASSESSEE SUCCEEDS FOR STATISTICAL PURPOSES. 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED. PRONOUNCED IN THE OPEN COURT ON THIS 18TH DAY OF JANUARY, 2011. SD/- SD/- (SHAILENDRA KUMAR YADAV) (G.S. PA NNU) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE, DATED: 18TH JANUARY, 2011 COPY TO:- 1) THE APPELLANT. 2) THE DCIT, CIR. 3 (2), AURANGABAD 3) THE CIT (A)-I, AURANGABAD 4) THE CIT II NASHIK 5) THE DEPARTMENTAL REPRESENTATIVE, B BENCH, ITAT, PUNE. BY ORDER TRUE COPY ASST. REGISTRAR, I.T.A.T., PUNE B