D.C.I.T CC - XX,kolkata, Kolkata V. M/s Naresh Kumar & Co, Kolkata

ITSSA 64/KOL/2013

• Counselvise Citation: [2016] 122 COUNSELVISE.COM (IT) 2270 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 1 month(s) 23 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 15-07-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 13-06-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 23-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SALLONG YADEN ADL CITSRDR
• Assessee Lawyers: S K TULSIYAN
• Keywords: Search and seizure; Document seized; Documents seized
• Section: 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH A KOLKATA BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI S.S.VISWANETHRA RAVI, JUDICIAL MEMBER IT(SS)A NO.64/KOL/2013 ASSESSMENT YEAR:2009-10 DCIT, CENTRAL CIRCLE- XX, 110, SHANTIPALLI, AAYAKAR BHAWAN, POORVA, 5 TH FLOOR, KOLKATA-700 001 / V/S . M/S NARESH KUMAR & CO. PVT. LTD., 9B, WOOD STREET, KOLKATA-700 016 [ PAN NO.AABCN 2864 P ] /APPELLANT .. /RESPONDENT /BY APPELLANT SHRI SALLONG YADEN, ADL.CIT-SR-DR /BY RESPONDENT SHRI S.K.TULSIYAN, ADVOCATE /DATE OF HEARING 13-06-2016 /DATE OF PRONOUNCEMENT 15-07-2016 /O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER:- THIS APPEAL BY THE REVENUE IS AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS),CENTRAL-III, KOLKATA DATED 28. 02.2013. ASSESSMENT WAS FRAMED BY JCIT(OSD), C.C-XX, KOLKATA U/S 144/153A O F THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) VIDE HI S ORDER DATED 26.12.2011 FOR ASSESSMENT YEAR 2009-10. 2. SOLITARY ISSUE RAISED BY REVENUE IS THAT LD CIT (A) ERRED IN DELETING THE ADDITION MADE BY ASSESSING OFFICER ON ACCOUNT OF B OGUS BILLS AMOUNTING TO 40,,72,117/-. 3. BRIEF FACTS ARE THAT ASSESSEE IS A PRIVATE LIMIT ED COMPANY AND ENGAGED IN BUSINESS OF TRANSPORT, CO-ORDINATION AND COAL SALE. THERE WAS A IT(SS)A 64/KOL/2013 A.Y.2009-10 DCIT, CC-XX,KOL. V. M/S NARESH KR & CO. PVT . LTD. PA GE 2 SEARCH & SEIZURE OPERATION U/S 132 OF THE ACT WAS C ONDUCTED ON 13.01.2010 AND ON SUBSEQUENT DATES IN THE BUSINESS PREMISES OF THE ASSESSEE. THE ASSESSEE-COMPANY IS ONE OF THE COMPANIES BELONGING TO THE SAME GROUP AND THEREFORE IT WAS DULY COVERED U/S 132 OF THE ACT. A S A RESULT OF SEARCH OPERATION, CERTAIN DOCUMENTS WERE IMPOUNDED MARKED AS AVR/5. THE AO OBSERVED THAT ON PAGE 16 OF AVR/5, IT WAS MENTIONED UNDER THE HEAD BILL TO BE COLLECTED TO RS.40,72,117/- WAS RECORDED IN THE NAME OF ASSESSEE BETWEEN THE PERIOD OF 07.04.2008 TO 27.09.2008. IT WAS ALSO MENTIONED THAT CORRESPONDING COMMISSION WHICH IS TO BE PAID ON THE ARRANGEMENT OF THESE BILLS. ACCORDINGLY, AO OBSERVED THAT ASSESSEE HAS C OLLECTED BOGUS BILLS IN LIEU OF THE COMMISSION AS EVIDENCED FROM THE IMPOUNDED D OCUMENTS. THEREFORE, AO HAS DISALLOWED A SUM OF 40,72,117/- AND ADDED IT TO THE TOTAL INCOME OF ASSESSEE. 4. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE L D CIT(A), WHERE ASSESSEE SUBMITTED THAT THE PAPER WAS CONTAINING RO UGH CALCULATION AND IT DOES NOT REPRESENT ANY BOGUS BILLS. REGARDING THIS, AO HAS NOT BROUGHT ON RECORD ANY EVIDENCE THAT THESE BILLS WERE FALSE IN THIS CONNECTION, THE ONUS OF PROVING LIES ON THE PART OF AO THAT THE BILLS ARE B OGUS. LD CIT(A) CALLED FOR REMAND REPORT FROM AO AND RELEVANT EXTRACT REPRODUC ED BELOW:- THE ASSESSEE EXPLAINED THAT THE FIGURES OF RS.40,7 2,117/- AND OTHERS APPEARING IN SEIZED DOCUMENT PAGE 16 OF AVR/5 ARE E STIMATED CALCULATIONS. HOWEVER, IT COULD NOT BE VERIFIED THAT THESE WERE E STIMATED FIGURES OR RELATE TO BOGUS BILLS, NEITHER THE AR COULD EXPLAIN REGARDING THE SAME. SO HOW THIS AMOUNT IS APPEARING IN SEIZED DOCUMENTS AND WHERE T HIS AMOUNT WAS SHOWN IS NOT KNOWN AND NO OTHER DOCUMENT COULD BE RELATED TO THIS AMOUNT. AFTER HEARING THE CONTENTION OF ASSESSEE AND REMAND REPORT OF AO, LD CIT(A) DELETED THE ADDITION BY OBSERVING AS UNDER:- IT IS OBSERVED THAT WHILE RAISING THE OBJECTION UN DER CONSIDERATION THE A.O MENTIONED THAT THE AMOUNT RECORDED ON PAGE 16 OF AN NEXURE AVR/5 APPEARED TO REPRESENT FALSE BILLS PROCURED BY THE A PPELLANT, HOWEVER, NO CONCLUSIVE FINDING TO THAT EFFECT WAS GIVEN. IN THE REMAND REPORT ALSO THE AO HAS COMMENTED THAT HE COULD NOT VERIFY WHETHER THE FIGURES ARE ESTIMATES OR ARE BOGUS BILLS. THIS SHOWS THAT THERE WAS NOTHING ON RECORD TO PROVE THAT THE AMOUNT RECORDED ON PAGE 16 OF THE ANNEXURE AVR/5 RE PRESENTS THE AMOUNT IT(SS)A 64/KOL/2013 A.Y.2009-10 DCIT, CC-XX,KOL. V. M/S NARESH KR & CO. PVT . LTD. PA GE 3 OF FALSE BILLS PROCURED BY THE APPELLANT. ON FACTS OF THE CASE SUCH CONCLUSION CANNOT BE CONCLUSIVELY DRAWN. THE LAW IS WELL ESTAB LISHED THAT NO ADDITION CAN BE SUSTAINED THAT IS MADE ON MERE SUSPICION. THE AP PELLANT HAS SUBMITTED THAT THE FIGURES WERE ESTIMATED CALCULATION HAVING NOTHING TO DO WITH REAL TRANSACTIONS. THERE IS NOTHING ON RECORD TO PROVE T HAT THE CONTENTION OF THE APPELLANT WAS WRONG OR INCORRECT. THEREFORE, NO ADJ USTMENT TO THE APPELLANTS CLAIM CAN BE MADE ON THIS ISSUE. BEING AGGRIEVED BY THIS ORDER OF LD CIT(A) REVENUE IS IN APPEAL BEFORE US. 5. BEFORE US LD DR SUBMITTED THAT DOCUMENTS IMPOUN DED AT THE TIME OF SEARCH ARE VERY CLEAR AND SELF-EXPLANATORY THAT THE BILLS WILL BE COLLECTED AGAINST THE COMMISSION. THEREFORE THESE ARE THE BOG US BILLS AND NEED TO BE ADDED TO THE TOTAL INCOME OF ASSESSEE. HE VEHEMENTL Y RELIED ON THE ORDER OF AO. ON THE OTHER HAND, LD AR FILED PAPER BOOK WHIC H IS RUNNING PAGES 1 TO 9 AND DREW OUR ATTENTION ON THE IMPOUNDED DOCUMENTS W HICH STATES THAT BILLS WOULD BE COLLECTED. SO IT MEANS THAT BILLS HAVE NOT YET BEEN COLLECTED AT THE TIME OF SEARCH. ACCORDINGLY NO BOGUS EXPENSE HAS BE EN BOOKED IN THE BOOKS OF ACCOUNT OF ASSESSEE TILL THE TIME OF SEARCH AND SEIZURE. SO THESE BILLS WERE NOT UTILIZED. THE LD AR ALSO DRAWN OUR ATTENTION ON THE LETTER W RITTEN BY THE AUTHORIZED SIGNATORY OF THE ASSESSEE WHICH STATES THAT THE DEC LARATION WAS MADE U/S. 132(4) OF THE ACT FOR A SUM OF 2 CRORES IN RELATION TO NARESH KIMAR & COMPANY BUT THE UNDISCLOSED INCOME WAS WORKED OUT A T 89.37 LAKHS ONLY ON THE BASIS OF SEIZED DOCUMENTS. THE ASSESSEE DID NOT RETRACT FROM HIS DECLARATION MADE FOR 2 CRORES U/S 132(4) OF THE ACT. FURTHER, LD AR SUBMITTED THAT ASSESSEE HAS DECLARED ITS INCOME OVE R AND ABOVE THE SEIZED DOCUMENTS BY 1,10,53,000/- AND IN THE CASE REVENUE WISHES TO TRE AT THE INCOME AT 80,72,117/- FROM THE UNDISCLOSED SOURCE THEN IT CA N BE DULY COVERED WITH THE INCOME DECLARED U/S. 132(4) OF THE ACT. THE LD. RELIED ON THE ORDER OF LD CIT(A). 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. FROM THE FOREGOING DISCUSSIONS WE FIND THAT SEIZED IT(SS)A 64/KOL/2013 A.Y.2009-10 DCIT, CC-XX,KOL. V. M/S NARESH KR & CO. PVT . LTD. PA GE 4 DOCUMENTS NO. AVR/5 WAS IMPOUNDED WHICH CONTAINS TH E DETAILS OF BILLS TO BE COLLECTED AND ACCORDINGLY, AO OPINED THAT THESE ARE BOGUS EXPENSE WHICH HAS BEEN CLAIMED BY ASSESSEE IN ITS RETURNED INCOME. HO WEVER, THE LD. DR HAS NOT BROUGHT ON RECORD ANY SPECIFIC MATERIALS IN RELATIO N TO THE BILLS FOR THE COMMISSION EXPENSES FROM THE IMPOUNDED DOCUMENTS EX HIBIT AVR/5. EVEN THE REMAND REPORT TAKEN BY LD.CIT(A) IS NOT CLEAR W HETHER ANY BOGUS EXPENSE HAS BEEN CLAIMED BY ASSESSEE OR NOT. THEREFORE IN O UR CONSIDERED VIEW, WE FIND NO REASON TO INTERFERE IN THE ORDER OF LD CIT( A)AND WE UPHOLD THE SAME. THIS GROUND RAISED BY REVENUE IS DISMISSED. 7. IN THE RESULT, REVENUES APPEAL STANDS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 15/07/2016 SD/- SD/- (S.S.VISWANETHRA RAVI) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER *DKP ! - 15/07/2016 / KOLKATA / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-DCIT, CENTRAL CIRCLE-XX, KOLKATA, 110, S HANTIPALLI, AAYAKAR BHAWAN, POORV A, 5 TH FLOOR, KOLKATA-700 001 2. /RESPONDENT-M/S NARESH KUMAR & CO. PVT. LTD., 9B, W OOD STREET, KOL-16 3. '# % / CONCERNED CIT 4. % - / CIT (A) 5. &'( ))'# , '# / DR, ITAT, KOLKATA 6. (*+ / GUARD FILE. BY ORD ER/ , /TRUE COPY/ / '#,