Mohit Steel Industries Pvt Ltd, Kundai V. ACIT, Central Circle, Panaji

ITSSA 77/PAN/2018

• Counselvise Citation: [2022] 129 COUNSELVISE.COM (IT) 9806 (ITAT-PANAJI)
• Duration Of Justice: 3 year(s) 5 month(s) 6 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 03-04-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: WT(D)
• Assessment Year: 2012-2013
• Appeal Filed On: 28-10-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJAN KUMAR
• Keywords: Search and seizure; Revised return
• Section: 132; 43B; 143(3); 153A; 250; 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH, PANAJI BEFORE DR. M. L. MEENA, ACCOUNTANT MEMBER & SHRI ANIKESH BANERJEE, JUDICIAL MEMBER I.T(SS)A. No. 77/PAN/2018 Assessment Year: 2012-13 Mohit Steel Industries Pvt. Ltd. 342, Kundai Industrial Estate Kundai Goa – 403115 [PAN: AABCM 9713 G] (Appellant) Vs. Assistant Commissioner, Central Circle-Panaji (Respondent) Appellant by Shri Neelkanth Khandelwal, Advocate Respondent by Shri Rajan Kumar, CIT, D/R Date of Hearing 29.03.2022 Date of Pronouncement 04.04.2022 ORDER Per Dr. M.L. Meena, A.M.: The captioned appeal is filed by the assessee against the order of the Learned Commissioner of Income Tax (Appeals) – 2, Panaji, [hereinafter the “ld. CIT (A)”] dt. 29/08/2018, passed u/s 250 of the Income Tax Act, 1961 [hereinafter ‘the Act’], for the Assessment Year 2012-13. 2. The assessee is a Private Limited Company engaged in the business of manufacturing of M.S. Ingots. It filed its return of income on 28/09/2012 declaring total income of Rs.61,41,569/-. Search and seizure operation u/s 132 of the Act was conducted on the business premises of the assessee on 10/02/2016. Subsequently notice u/s 153A of the Act was issued on 31/01/2017 and served upon the assessee on 07/02/2017. In response the assessee filed revised return of income declaring the same income as filed in the original return. The AO issued notice u/s 143(2) of the Act and completed the assessment u/s 153A r.w.s. 143(3) of the Act on 27/12/2017, assessing the total income of the assessee at Rs.1,64,03,272/- interalia making addition of Rs.1,00,88,940/- on account of entry tax expenses claimed in the books of account for the relevant assessment year. I.T(SS)A. No. 77/PAN/2018 Assessment Year: 2012-13 Mohit Steel Industries Pvt. Ltd. 2 3. Aggrieved the assessee carried the matter in appeal before the ld. CIT(A), who gave part relief by holding as under:- “3.5. Thus, as per the provisions of section 43B of the Act, the appellant is entitled to claim deduction for any tax paid during the previous year relevant to the assessment year irrespective of the year to which the liability to pay such tax was incurred by the appellant. During the impugned assessment year, appellant has paid the entry tax of Rs.35,12,184/- on various dates in F.Y. 2011- 12 by cheques drawn on State Bank of Mysore, Panaji Branch, which is allowable as deduction even though, the same has not been claimed separately in the return of income as it was part of the total amount claimed in the Profit and Loss account of Rs. 1,00,88,940/- . The AO is directed to verify the claim of the appellant once again and allow Rs.35,12,184/- as the deduction out of total disallowance of Rs.1,00,88,940/- Thus, the addition made by the AO to the tune of Rs.65,76,756/- is sustained and the appellant shall get relief of Rs.35,12,184/- after due verification by the AO. Ground no 1 is treated to have been partly allowed. 4. Further aggrieved the assessee is before us in appeal. 5. The primary contention raised by the ld. Counsel for the assessee is that the Assessing Officer in the entire assessment order has not referred to any incriminating material/documents/panchnama based on which the additions were made by him. That the AO has failed to establish that he was in possession of any document which had a direct nexus to the addition being made making the assessment bad in law. He further submitted that even the ld. CIT(A) has failed to appreciate the legal position that in absence of any incriminating material found during the course of search no addition could have been made in the hands of the assessee. Neither the ld. AO nor the ld. CIT(A) have made any whisper regarding the document/material seized during the course of search based on which the addition was made. 6. The ld. D/R relied on the order of the ld. CIT(A) and prayed that the same may be upheld. 7. After hearing rival contentions, perusing the material available on record, orders of the authorities below as well as the case-law cited, we hold as follows:- 8. From the order of the ld. AO it transpires that, he has failed to place reliance on any incriminating material found during the course of search based on which the addition was made. Even the ld. First Appellate Authority has not made any whisper I.T(SS)A. No. 77/PAN/2018 Assessment Year: 2012-13 Mohit Steel Industries Pvt. Ltd. 3 in his order regarding any incriminating material found during the course of search. Under these circumstance the addition made by the ld. AO has not legs to stand on. 9. We find that the Mumbai Bench of the Tribunal in the case of DCIT vs. Vipul Suresh Kumar Modi in ITA No. 540/Mum/2021; order dt. 17/02/2022, while adjudicating an identical issue has held as follows:- “6. We have heard the rival contentions, perused the material on record and duly considered factual matrix of the case as also the applicable legal position. The CIT(A) has returned factual finding that the additions made by the AO are not based on any incriminating material found during the course of search and the same remains uncontroverted. The Ld. Departmental Representative could not dispute the proposition that additions in the present case cases have not been made on the basis of any incriminating material found during search. The CIT(A) has granted relief by following the decision of the jurisdictional High Court in the case of Continental Warehousing Corporation (supra) wherein it has been held that no addition can be made in respect of unabated assessments which have become final in absence of any incriminating material found during search. This view has also been upheld by the Hon‟ble Supreme Court in the case of CIT vs. Sinhgad Technical Education Society and Others vide judgment dated 29.08.2017 in Civil Appeal No. 11080 of 2017, reported in 397 ITR 344 (SC). We do not find any merit in the present appeal.” [Emphasis ours] 10. As the facts in the case on hand are identical to the case of DCIT vs. Vipul Suresh Kumar Modi (supra), consistent with the view taken by the Mumbai Bench of the Tribunal while placing reliance on the judgment of the Hon’ble High Court of Bombay in the case of Continental Warehousing Corporation (supra), we deleted the additions made by the AO as bad in law and allow this appeal of the assessee. 11. In the result, appeal of the assessee is allowed Order pronounced in the open court on 04.04.2022 Sd/- Sd/- (Anikesh Banerjee) (Dr. M.L. Meena) Judicial Member Accountant Member SC, Sr.P.S. I.T(SS)A. No. 77/PAN/2018 Assessment Year: 2012-13 Mohit Steel Industries Pvt. Ltd. 4 Copy of the order forwarded to: (1)The Appellant:- (2) The Respondent :- (3) The CIT:- (4) The CIT (Appeals):- (5) The DR, I.T.A.T.:- True Copy By Order Sr. Private Secretary ITAT