DCIT, CC-XXIII, KOLKATA, Kolkata V. M/s Shree Dadu Impex Pvt. Ltd., Kolkata

ITSSA 61/KOL/2014

• Counselvise Citation: [2017] 122 COUNSELVISE.COM (IT) 3357 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 1 month(s) 28 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 02-06-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: misc
• Appeal Filed On: 04-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GOUTEN HANGSHING
• Assessee Lawyers: A K TIBREWAL
• Keywords: Document seized; Tangible material; Block assessment; Documents seized

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH C KOLKATA BEFORE SHRI N.V.VASUDEVAN, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER IT (SS) A NO. 61 / KOL / 2014 BLOCK PERIOD 01.04.1996 TO 28.10.2002 : DCIT, CENTRAL CIRCLE- XXIII, KOLKATA, 5 TH FLOOR, AAYAKAR BHAWAN, POORVA, 110, SANTHI PALLY, KOLKATA V/S . M/S SHREE DADU IMPEX PVT. LTD., 4, RAM SETT ROAD, KOLKATA-06 [ PAN NO.AAECS 2093 L ] /APPELLANT .. / RESPONDENT /BY APPELLANT SHRI GOUTEN HANGSHING, CIT-DR /BY RESPONDENT SHRI A.K. TIBREWAL, FCA /DATE OF HEARING 26-04-2017 /DATE OF PRONOUNCEMENT 02-06-2017 / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER:- THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-III, KOLKATA D ATED 27.01.2014. BLOCK ASSESSMENT WAS FRAMED BY ACIT, CC-XXII, KOLKATA U/S 158BC/143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS T HE ACT) VIDE HIS ORDER DATED 23.07.2007 FOR THE BLOCK PERIOD FROM 01.04.2002 TO 28.10.2002. SHRI GOUTEN HANGSHING LD. DEPARTMENTAL REPRESENTATI VE REPRESENTED ON BEHALF OF REVENUE AND SHRI A.K. TIBREWAL, LD. AUTHO RIZED REPRESENTATIVE APPEARED ON BEHALF OF ASSESSEE. IT(SS)A NO.61/KOL/2014 B.P. 01.04.96 TO 28.10.0 2 DCIT CC-XXIII, KOL VS. M/S SHREE DADU IMPEX PVT. LTD. PAGE 2 2. THE SOLITARY INTER-CONNECTED ISSUE RAISED BY REV ENUE IN THIS APPEAL IS THAT LD. CIT(A) ERRED IN DELETING THE ADDITION OF 1,44,85,836/- ON ACCOUNT OF UNDISCLOSED INCOME OF ASSESSEE. 3. BRIEFLY STATED FACTS ARE THAT ASSESSEE IS A PRIV ATE LIMITED COMPANY AND ENGAGED IN TRADING BUSINESS OF TIMBER. A SEARCH OPE RATION WAS CONDUCTED U/S 132(1) OF THE ACT AT THE BUSINESS AND OFFICE PREMIS ES OF THE ASSESSEE- COMPANY AS WELL AS AT THE RESIDENTIAL PREMISES OF T HE DIRECTOR OF THE ASSESSEE-COMPANY ON 28.10.2002. AS A RESULT OF SEAR CH, VARIOUS DOCUMENTS WERE SEIZED AND INVENTORIED. DURING THE COURSE OF A SSESSMENT PROCEEDINGS, AO OBSERVED THAT AS PER THE SEIZED DOCUMENTS MARKED AS SKDP/3 AT PAGE 24 THERE IS A BALANCE-SHEET AS ON 31.03.2003 SHOWING T OTAL SIDE OF THE ASSETS OF 1,44,85,836/- WHEREAS IN THE BALANCE SHEET FILED B Y THE ASSESSEE WITH THE RETURN DEPICTING TOTAL SIDE OF THE ASSETS FOR 1,32,26,432/- ONLY. ACCORDINGLY, AO TREATED THE SUM OF 1,44,85,836/- AS UNDISCLOSED INCOME OF ASSESSEE AND ADDED TO THE TOTAL INCOME OF ASSESSEE. 4. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE L D. CIT(A). THE ASSESSEE BEFORE LD. CIT(A) SUBMITTED THAT ADDITION HAS BEEN MADE MERELY ON THE BASIS OF PRINTED DOCUMENTS FOUND AT THE TIME OF SEARCH. THE ASSESSEE FURTHER SUBMITTED THAT SAME ADDITION WAS MADE IN TH E HANDS OF THE DIRECTOR OF THE ASSESSEE-COMPANY ON THE BASIS OF SAME DOCUMENT WHICH HAS BEEN DELETED VIDE ORDER DATED 25.03.2013 IN APPEAL NO.68 OF A.Y. 2007-08. THE LD. CIT(A) AFTER CONSIDERING THE SUBMISSION OF ASSESSEE HAS DELETED THE ADDITION MADE BY AO. THE REVENUE, BEING AGGRIEVED, IS IN APPEAL BEFORE U S ON THE FOLLOWING GROUNDS:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN BOTH LAW AND FACTS IN ALLOWING RELIEF TO THE ASSESS EE WITHOUT CONSIDERING THE FACT THAT THE SEIZED DOCUMENTS CONTAIN INCRIMIN ATING DETAILS OF EVASION OF INCOME AS EVIDENT ON PERUSAL OF SEIZED D OCUMENTS. 1.1 ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN BOTH LAW AND FACTS IN ALLOWING RELIEF TO THE ASS ESSEE WITHOUT GETTING THE ENTRIES APPEARING IN THE INCRIMINATING DOCUMENTS CROSS VERIFIED AND EXAMINED WITH RESPECTIVE PARTIES, THE NAMES OF WHOM ARE APPEARING IN THE SEIZED DOCUMENTS. IT(SS)A NO.61/KOL/2014 B.P. 01.04.96 TO 28.10.0 2 DCIT CC-XXIII, KOL VS. M/S SHREE DADU IMPEX PVT. LTD. PAGE 3 1.2 ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN ALLOWING RELIEF TO THE ASSESSEE WITHOUT CONSIDER ING THE FACT THAT THE ONUS IS ON THE ASSESSEE TO PROVE THE CONTENTS A PPEARING IN THE SEIZED DOCUMENTS WHICH HAS NOT BEEN DISCHARGED WITHOUT GETTING IT CROSS VERIFIED AND EXAMINED WHICH WAS VE RY MUCH REQUIRED IN VIEW OF THE NATURE AND CONTENTS OF THE ENTRIES APPEARING IN THE SEIZED DOCUMENTS. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN BOTH LAW AND FACTS IN ALLOWING RELIEF TO THE ASSESS EE OF RS.1,44,85,836/- TREATED AS UNDISCLOSED INCOME ON THE BASIS OF DIFFE RENCE IN THE FIGURES OF THE SEIZED BALANCE SHEET AS ON 31.03.2003 AND TH E BALANCE-SHEET FILED WITH THE RETURN BY THE ASSESSEE. 2.1 ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN ALLOWING ENTIRE RELIEF OF RS.1,4,85,836/- TO THE AS SESSEE STATING THAT THE MAJOR DISCREPANCIES HAVE BEEN RECONCILED IN THE REM AND REPORT, BUT IN FACT RS.82,28,408/- REMAINED UNVERIFIED AS REPORTED IN THE REMAND REPORT AND THUS THE RELIEF GRANTED BY THE LD. CIT(A ) ON THIS BASIS IS NOT AT ALL CORRECT ON WRONG FACTS AND ON ASSUMPTION THA T MAJOR DISCREPANCIES HAVE BEEN RECONCILED. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN ALLOWING RELIEF TO THE ASSESSEE OF RS.1,44,85,836/- RELYING ON THE APPELLANT ORDER IN THE CASE OF SHRI RAMESH BHANIRAM KA, DIRECTOR OF THE COMPANY, WHERE THE FACTS OF THE CASE ARE NOT SIMILA R. 3.1 ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN BOTH LAW AND FACTS IN GRANTING RELIEF TO THE ASSESS EE WITHOUT GIVING OPPORTUNITY TO THE AO TO DISTINGUISH THAT THE FACTS ARE NOT SIMILAR TO THE CASE OF SHRI RAMESH BHANIRAMKA. 5. LD. DR FOR THE REVENUE HEAVILY RELIED ON THE ORD ER OF ASSESSING OFFICER WHEREAS LD. AR FOR THE ASSESSEE FILED PAPER BOOK WH ICH IS RUNNING PAGES FROM 1 TO 54 AND SUBMITTED THAT SEARCH WAS CONDUCTE D ON 28.10.2002 WHEREIN IMPUGNED SEARCH DOCUMENT SHOWING BALANCE-SHEET AS O N 31.03.2003 WAS SEIZED. THUS IT IS CLEAR THAT THE BALANCE SHEET SEI ZED AS ON 28.10.2002 WAS SHOWING THE BALANCE SHEET AS ON 28.10.2002 AND NOT AS ON 31.3.2003 WHICH IN-FACT IS NOT POSSIBLE. THEREFORE, THE ADDITION HA S BEEN MADE BY THE LOWER AUTHORITIES ON WRONG ASSUMPTION OF FACTS. LD. AR FO R THE ASSESSEE ALSO STATED THAT THE DIFFERENCE WAS OBSERVED BY THE AO BETWEEN THE AMOUNTS OF ACTUAL BALANCE-SHEET VIS--VIS THE AMOUNT OF BALANCE-SHEET SHOWN IN THE SEIZED DOCUMENTS. LD. AR FURTHER SUBMITTED THAT THE INFORM ATION GATHERED AT THE TIME OF SEARCH HAS NO SIGNIFICANCE AND THE IMPUGNED DOCU MENT CANNOT BE RELIED IT(SS)A NO.61/KOL/2014 B.P. 01.04.96 TO 28.10.0 2 DCIT CC-XXIII, KOL VS. M/S SHREE DADU IMPEX PVT. LTD. PAGE 4 UPON AS THE RELEVANT FINANCIAL YEAR WAS NOT EXPIRED ON THE DATE OF SEARCH. HE RELIED ON THE ORDER OF LD. CIT(A). 6. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD AS WELL AS ORDER OF A UTHORITIES BELOW. FROM THE FOREGOING DISCUSSED, WE FIND THAT A SEARCH WAS COND UCTED AT THE OFFICE AND BUSINESS PREMISES OF ASSESSEE DATED 28.10.2002. DUR ING THE SEARCH, A DOCUMENT DEPICTING THE BALANCE-SHEET AS ON 31.03.20 03 WAS SEIZED WHICH WAS MARKED AS SKDP/3. ON THE BASIS OF SUCH DOCUMENT THE ADDITION WAS MADE BY AO AS DISCUSSED AFORESAID. ON PERUSAL OF TH E SAID DOCUMENT MARKED AS SKDP/3, WE FIND THAT IT IS A BALANCE SHEET DATED 31.3.2003 WHICH WAS SEIZED AS ON THE DATE OF SEARCH I.E. 28.10.2002. IN THIS REGARD WE FIND THAT BY NO STRETCH OF IMAGINATION THE IMPUGNED BALANCE SHEE T CAN REFLECT THE ACTUAL BALANCE-SHEET AS ON 31.03.2003 AS ON THE DATE OF SE ARCH. IT IS BECAUSE OF THE UNDISPUTED FACT THAT BALANCE-SHEET AS ON 31.03.2003 CANNOT BE PREPARED AS ON 28.10.2002. THUS, THE IMPUGNED SEIZED DOCUMENT C ANNOT BE RELIED FOR THE AFORESAID ADDITION. BESIDES THE ABOVE WE FIND THAT THE LD. DR HAS NOT BROUGHT ANYTHING ON RECORD CONTRARY TO THE FINDING OF LD. C IT-A. MOREOVER WE FIND THAT THE IMPUGNED ADDITION WAS MADE BY THE AO ON HIS PRE MISE AND CONJUNCTURE AND WITHOUT BRINGING ANY TANGIBLE MATERIALS. ANY AD DITION MADE BY THE AO CAN BE SUSTAINED ONLY IF IT IS SUPPORTED ON THE BASIS O F MATERIALS. THEREFORE, IN THE LIGHT OF ABOVE REASONING, WE HOLD THAT THE ORDER OF THE LD. CIT(A) IS CORRECT AND IN ACCORDANCE WITH LAW AND NO INTERFERENCE IS C ALLED FOR. HENCE, THE GROUNDS OF REVENUES APPEAL ARE DISMISSED. 7. IN THE RESULT, REVENUES APPEAL STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT 02 /06/2017 SD/- SD/- ( !') ( !') (N.V.VASUDEVAN) (WASEEM AHMED) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) KOLKATA, *DKP, SR.P.S $!% &- 02 / 06 /201 7 IT(SS)A NO.61/KOL/2014 B.P. 01.04.96 TO 28.10.0 2 DCIT CC-XXIII, KOL VS. M/S SHREE DADU IMPEX PVT. LTD. PAGE 5 / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-DCIT, CENTRAL CIRCLE-XXIII, AAYAKAR BHAW AN POORVA, 110, SANTI PALLY, 5 TH FLOOR, 2. /RESPONDENT-M/S SHREE DADU IMPEX PVT. LTD., 4 RAM S ETT ROAD, KOLKATA-06 3. %.%/0 1 1 2 / CONCERNED CIT KOLKATA 4. 1 1 2- / CIT (A) KOLKATA 5. 567 /0, 1 /0 , / DR, ITAT, KOLKATA 6. 7:; <= / GUARD FILE. BY ORDER/ 1! , /TRUE COPY/ SR. PRIVATE SECRETARY, HEAD OF OFFICE/DDO 1 /0 ,