SHIV EDIBLES LTD., Kota V. ACIT, Kota

MA 106/JPR/2018

• Counselvise Citation: [2018] 122 COUNSELVISE.COM (IT) 4205 (ITAT-JAIPUR)
• Duration Of Justice: 2 month(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 04-10-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 03-08-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K C MEENA
• Keywords: Rejection of books of accounts
• Section: 14A

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM VK;DJ VIHY LA-@ MA NO. 106/JP/2018 (ARISING OUT OF ITA NO. 580/JP/2013) M/S SHIV EDIBLES LTD., 237-A, TALWANDI, KOTA. CUKE VS. THE ACIT, CIRCLE-1, KOTA. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AAICS 0274 K VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI MAHENDRA GARGIEYA (ADV.) JKTLO DH VKSJ LS @ REVENUE BY : SHRI K.C. MEENA (ADDL. CIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 28/09/2018 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 04/10/2018 VKNS'K@ ORDER PER: VIKRAM SINGH YADAV, A.M. THE PRESENT MISCELLANEOUS APPLICATION HAS BEEN FILE D BY THE ASSESSEE AGAINST THE ORDER PASSED BY THE CO-ORDINAT E BENCH IN ITA NO. 580/JP/2013 DATED 26.02.2018. 2. THE LD. AR HAS BASICALLY CONTENDED THAT THE GROU ND RAISED BY THE REVENUE BEFORE THE TRIBUNAL WAS IN RESPECT OF REJEC TION OF BOOKS OF ACCOUNTS AND ANOTHER GROUND WAS REGARDING ESTIMATIO N OF GROSS PROFIT RATE, HOWEVER, ON PERUSAL OF THE FINDINGS OF THE CO ORDINATE BENCH, IT APPEARS THAT THE ENTIRE FOCUS OF THE TRIBUNAL HAS B EEN ONLY IN RESPECT OF M.A. NO. 106/JP/2018 M/S SHIV EDIBLES LTD. ACIT 2 CORRECTNESS OR OTHERWISE OF THE INVOCATION OF PROVI SIONS OF SECTION 145(3) OF THE ACT, HOWEVER AS FAR AS ESTIMATION OF GROSS PROFIT IS CONCERNED, THE SAID GROUND HAS NOT BEEN DECIDED BY THE COORDINATE BENCH AND THE SAME HAS RESULTED IN MISCARRIAGE OF J USTICE AND SQUARELY AFFECTED THE INTEREST OF THE ASSESSEE. IT WAS ACCOR DINGLY SUBMITTED THAT THE MATTER MAY KINDLY BE RECALLED TO ADJUDICATE GRO UND NO. 2 SO RAISED BY THE REVENUE. 3. THE LD. DR IS HEARD WHO HAS OPPOSED THE MISCELLA NEOUS APPLICATIONS FILED BY THE ASSESSEE. 4. ON PERUSAL OF THE ORDER PASSED BY THE COORDINATE BENCH IN ITA NO. 580/JP/2013 DATED 26.02.2018, WE FIND THAT THER E WERE THREE GROUNDS RAISED BY THE REVENUE, FIRST GROUND REGARDI NG THE REJECTION OF BOOKS OF ACCOUNTS, THE SECOND GROUND REGARDING THE TRADING ADDITION BY ADOPTING GP RATE AND THE THIRD GROUND REGARDING DEL ETION OF ADDITION U/S 14A OF THE ACT. HOWEVER, ON PERUSAL OF THE FINDING S OF THE COORDINATE BENCH IN PARA 5 WHICH IS REPRODUCED AS UNDER, WE FI ND THAT GROUND NO. 2 AND 3 HAS ESCAPED THE ATTENTION OF THE COORDINATE BENCH AND HAS NOT BEEN ADJUDICATED UPON:- 5. AFTER HEARING BOTH THE SIDES, THE BENCH FIND TH AT THE BOOKS OF ACCOUNT OF THE ASSESSEE WERE REJECTED ON ACCOUNT OF VARIOUS DISCREPANCIES NOTED BY THE ASSESSING OFFICER ON ACC OUNT OF SHORTAGE, VALUATION OF CLOSING STOCK AND ON ACCOUNT OF LOW YI ELD. THE ASSESSING OFFICER HAS ALSO CLEARLY NOTED THAT THE CERTAIN EXP ENSES HAS BEEN INCREASED DISPROPORTIONATELY IN RELATION TO INCREAS E IN TURN OVER FOR EXAMPLE, PACKING MATERIAL EXPENSES WERE OF RS. 9,78 ,779/- IN THE A.Y. M.A. NO. 106/JP/2018 M/S SHIV EDIBLES LTD. ACIT 3 2008-09, THE SAME HAVE BEEN INCREASED TO 53,96,886/ -. THERE WAS NO CLOSING STOCK OF PACKING MATERIAL. THE TURNOVER FOR A.Y. 2008-09 WAS MORE THAN 262 CRORES WHILE THE TURNOVER FOR THE YEA R UNDER CONSIDERATION WAS AROUND 300 CRORES. THUS, THE INCR EASE IN THE EXPENDITURE ON PACKING MATERIAL IS DEFINITELY DISPR OPORTIONATE AND THE SAME HAVE NOT BEEN EXPLAINED BY THE ASSESSEE. FURTH ER THERE IS VAST DIFFERENCE IN THE RATE OF OPENING STOCK, SALES AND CLOSING STOCK. SUCH DIFFERENCES HAVE BEEN CATEGORIZED AS UNDER: QTY. SHOWN AS PER CL. STOCK (KG) RATE DIFFERENCE PER KG. TOTAL DIFFERENCE REFINED OIL 419602 13.17 55,26,158 CRUDE OIL 398051 13.41 53,37,863 MUSTERED OIL 251129 11.21 28,15,156 THE ASSESSEE HAS NOT EXPLAINED THIS DIFFERENCE WITH COGENT REASONS. THEREFORE, ALL THESE FACTS CLEARLY ESTABLISH THAT T HE BOOK RESULT DECLARED BY THE ASSESSEE WERE NOT RELIABLE. THE LD. CIT(A) W ITHOUT GIVING FINDING ON THESE VARIOUS SPECIFIC DISCREPANCIES NOTICED BY THE ASSESSING OFFICER HAS SIMPLY DELETED THE ADDITION, THEREFORE, THE FIN DINGS OF THE LD. CIT(A) ARE PERVERSE. WE SET ASIDE THE ORDER OF THE LD. CIT (A) AND SUSTAIN THE ORDER OF THE ASSESSING OFFICER. 5. IN LIGHT OF ABOVE, WE HEREBY RECALLED THE ORDER OF THE COORDINATE BENCH FOR THE LIMITED PURPOSE OF THE ADJUDICATION O F GROUND NO. 2 AND 3 RAISED BY THE REVENUE IN ITS APPEAL WHICH READS AS UNDER:- M.A. NO. 106/JP/2018 M/S SHIV EDIBLES LTD. ACIT 4 (II) DELETING THE TRADING ADDITION OF RS. 30,21,3 70/- BY ADOPTING GP RATE OF 4.9% WHICH WAS AGREED TO BY THE ASSESSEE DU RING THE COURSE OF ASSESSMENT PROCEEDINGS. (III) DELETING THE ADDITION OF RS 7,37,336 MADE BY THE AO U/S 14A R/W RULE 8D 5. WE MAY ADD THAT EVEN THOUGH THE ASSESSEE HAS NOT HIGHLIGHTED THE NON-ADJUDICATION OF GROUND NO. 3 FOR REASONS BEST K NOWN TO IT, GIVEN THE FACT THAT THE SAID GROUND WAS NOT ADJUDICATED UPON BY THE COORDINATE BENCH, IT IS CLEARLY A MATTER CALLING FOR OUR INTER FERENCE U/S 254(2) OF THE ACT WHICH WE HAVE ACTED UPON. 6. THE REGISTRY IS DIRECTED TO LIST THE MATTER FOR HEARING ON MERITS ON 28.11.2018. ISSUE NOTICE TO BOTH THE PARTIES. THE PARTIES ARE AT LIBERTY TO FILE PAPERBOOK, IF ANY, ONE WEEK IN ADVANCE OF T HE SCHEDULED DATE OF HEARING. THE MISCELLANEOUS APPLICATION IS DISPOSED OFF WITH ABOVE DIRECTIONS. ORDER PRONOUNCED IN THE OPEN COURT ON 04/10/2018. SD/- SD/- FOT; IKY JKO FOE FLAG ;KNO (VIJAY PAL RAO) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 04/10/2018. * SANTOSH VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: M.A. NO. 106/JP/2018 M/S SHIV EDIBLES LTD. ACIT 5 1. VIHYKFKHZ@ THE APPELLANT- M/S SHIV EDIBLES LTD., KOTA. 2. IZR;FKHZ@ THE RESPONDENT- ACIT, CIRCLE-1, KOTA. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE { M.A. NO. 106/JP/2018} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR