ITO, Wd-36(1), Kolkata, Kolkata V. Sri Ravi Sharma, Kolkata

MA 119/KOL/2017

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 6452 (ITAT-KOLKATA)
• Duration Of Justice: 9 month(s) 6 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 13-04-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 07-07-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANOJ KATARUKA
• Assessee Lawyers: S DASGUPTA
• Keywords: Reassessment proceedings
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B, BENCH KOLKATA BEFORE SHRI S.S.VISWANETHRA RAVI, JM & DR. A.L.SAINI, AM M.A. NO.119/KOL/2017 (A/O I.T.A. NO.331/KOL/2014) (A.Y: 2009-10) I.T.O , WARD - 36 ( 1 ), KOLKATA VS. SRI RAVI SHARMA 8R, JAGODYAN LANE, 3 RD FLOOR, KOLKATA 700 054. ./ ./PAN/GIR NO. : AZKPS 3079 G ( /APPELLANT ) .. ( / RESPONDENT ) APPELLANT BY : SHRI S. DASGUPTA, ADDL. CIT REVENUE BY : SHRI MANOJ KATARUKA, ADVOCATE / DATE OF HEARING : 02/02/2018 /DATE OF PRONOUNCEMENT: 13/04/2018 / O R D E R PER DR. ARJUN LAL SAINI, AM: BY WAY OF CAPTIONED APPLICATION, THE REVENUE HAS SOUGHT TO POINT OUT THAT A MISTAKE APPARENT FROM RECORD WITHIN THE MEANING OF SECTION 254(2) OF THE INCOME TAX ACT, 1961(IN SHORT THE ACT) HAS CREPT IN THE ORDER OF THE TRIBUNAL DATED 31.01.2017. 2. THE GRIEVANCE OF THE REVENUE IN THIS MISCELLANEOUS APPLICATION IS THAT THE TRIBUNAL HAS ERRED IN HOLDING THAT CREDIT BALANCE OF RS.48,00,000/- SHOWN IN THE ASSESSEES BALANCE SHEET AS ON 31.03.2009, HAS ALREADY BEEN ASSESSED AS INCOME FOR ASSESSMENT YEAR 2007-08. THAT IS, THE LD. DR FOR THE REVENUE POINTED OUT THAT THE SUM OF RS.48,00,000/- SHOWN IN THE BALANCE SHEET OF THE ASSESSEE HAS NEVER BEEN TAXED AS POINTED OUT BY THE TRIBUNAL AND M.A. NO.119/KOL/2017 SRI RAVI SHARMA A.Y: 2009-10 2 THE SAME IS ALSO PROVED TO BE NOT GENUINE. THE DR POINTED OUT THAT THE HONBLE TRIBUNAL HAS FAILED TO APPRECIATE THE FACT THAT IT IS NOT THE CASE THAT THE AMOUNT WHICH HAD BEEN RECEIVED BY THE ASSESSEE FROM M/S. ADHUNIK CORPORATION LTD. DURING THE FINANCIAL YEAR 2006-07, WAS SHOWN AS ADVANCE AS ON 31.03.2009. THE HONBLE ITAT DID NOT CONSIDER THE FACT THAT NO TRANSACTION TOOK PLACE WITH THE SAID PARTY DURING THE FINANCIAL YEAR 2007-08 AND 2008-09 AND THEREFORE NO AMOUNT COULD REMAIN PAYABLE AS ON 31.03.2009. IT IS ALSO NOTICED THAT M/S SENDOZ IMPEX AND M/S SANDOZ COMMERCIAL WERE NOT THE DEBTORS OF THE ASSESSEE AS ON 31.03.2009. IN FACT, THE ASSESSEE RAISED BOGUS LIABILITY OF RS.48,00,000/- IN HIS BOOKS, FOR THE FINANCIAL YEAR 2008-09 IN THE NAME OF M/S. ADHUNIK CORPORATION LTD. THE HONBLE ITAT IS ALSO FAILED TO APPRECIATE THE DIFFERENCE OF INGREDIENTS INVOLVED IN THE FORM OF RS.48,00,000/- BETWEEN THE ASSESSMENT YEAR 2007-08 AND 2009-10. 3. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED BEFORE US THAT IN THE REASSESSMENT ORDER, THE ASSESSING OFFICER HAS RECTIFIED THE MISTAKE WHICH WAS DONE IN THE ORIGINAL ASSESSMENT U/S 143(3) OF THE ACT. AS PER REASSESSMENT ORDER UNDER SECTION 147/148, THE ASSESSEE ADMITTED THAT HE PURCHASED GOODS WORTH OF RS.48,00,000/- ON CREDIT AND MADE THE PAYMENTS OF RS.18,00,000/- ON 28.02.2007 AND RS.30,00,000/- ON 26.03.2007 AGAINST THE PURCHASES THROUGH HIS BANK ACCOUNT, BEING NO.CA/6343, WITH THE FEDERAL BANK LIMITED, AFTER RECEIVING THE SALES PROCEEDS FROM M/S M.A. NO.119/KOL/2017 SRI RAVI SHARMA A.Y: 2009-10 3 ADHUNIK CORPORATION LTD. THE ASSESSEE ADMITTED THAT HE HAD EARNED A PROFIT OF RS.2,13,164/-, ON THE SALES OF RS.50,13,164/- AND OFFERED THE INCOME FOR TAXATION FOR THE ASSESSMENT YEAR 2007-08. ACCORDINGLY, THE ASSESSING OFFICER REASSESSED INCOME OF RS.2,13,164/- IN THE REASSESSMENT PROCEEDINGS. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT ABOUT RS.48,00,000/- WHICH IS REFLECTING IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE, AS OPENING BALANCE IN THE BALANCE SHEET FOR ASSESSMENT YEAR 2009-10, RELATES TO ANOTHER TRANSACTION. THE LD. COUNSEL FOR THE ASSESSEE ALSO SUBMITTED THAT IT IS NOT A BOGUS LIABILITY. THE LD COUNSEL POINTED OUT THAT IN ORDER TO CREATE A BOGUS LIABILITY IN THE BOOK OF ACCOUNTS, THERE SHOULD BE CORRESPONDING ASSET IN THE BOOKS TO THAT EXTENT AND THE REVENUE HAS FAILED TO POINT OUT THE CORRESPONDING ASSET AGAINST THE BOGUS LIABILITY. 4. WE HAVE GIVEN A CAREFUL CONSIDERATION TO THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD, WE NOTE THAT THE AMOUNT OF RS.48,00,000/- RELATES TO ANOTHER TRANSACTION AND DOES NOT RELATE TO THE TRANSACTION WHICH HAS BEEN RECTIFIED BY THE ASSESSING OFFICER U/S 147/148 OF THE ACT. WE NOTE THAT AS PER ASSESSMENT ORDER U/S 147, PERTAINING TO ASSESSMENT YEAR 2007-08, THE ASSESSEE ADMITTED THAT HE HAD EARNED A PROFIT OF RS. 2,13,164/- ON THE SALES OF RS.50,13,164/- AND OFFERED THE INCOME FOR TAXATION FOR THE ASSESSMENT YEAR 2007-08. THE M.A. NO.119/KOL/2017 SRI RAVI SHARMA A.Y: 2009-10 4 ENTIRE SUM OF RS.50,13,164/- HAS BEEN TAXED IN THE ASSESSMENT YEAR 2007-08, THEREFORE, THERE IS NO LIABILITY ON THE ASSESSEE TO TAX THIS AMOUNT IN THE SUBSEQUENT ASSESSMENT YEAR 2009-10, I.E. THE ASSESSMENT YEAR UNDER CONSIDERATION. ABOUT ANOTHER AMOUNT OF RS.48,00,000/-, WE NOTE THAT IT IS COMING IN THE BOOKS OF ACCOUNT AS BROUGHT FORWARD BALANCE ( OPENING BALANCE) IN THE BALANCE SHEET FOR THE ASSESSMENT YEAR 2009-10, WHICH RELATES TO ANOTHER TRANSACTION. THE LD. DR FOR THE REVENUE HAS NOT ESTABLISHED OR BROUGHT ANY RECORD TO SHOW THAT LIABILITY OF RS.48,00,000/- SHOWN BY THE ASSESSEE IN THE BALANCE SHEET SINCE THE ASSESSMENT YEAR 2007-08, (WHICH IS COMING AS OPENING BALANCE) IS WRONG OR DOES NOT PERTAIN TO ASSESSEE. THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED BEFORE US THAT DURING THE COURSE OF HEARING OF THIS MISCELLANEOUS APPLICATION, THE AMOUNT OF RS.48,00,000/-, WHICH IS GETTING REFLECTED IN THE BALANCE SHEET FOR THE ASSESSMENT YEAR 2009-10, RELATES TO ANOTHER TRANSACTION AND THE LD. DR FOR THE REVENUE HAS FAILED TO CONTROVERT THE FINDING OF THE LD. COUNSEL FOR THE ASSESSEE THAT WHY THE SAID AMOUNT DOES NOT RELATE TO ANOTHER TRANSACTION. WE ALSO DO NOT ACCEPT THE PLEA OF THE LD DR THAT SAID AMOUNT OF RS. 48,00,000/- IS A BOGUS LIABILITY. IN ORDER TO BE A BOGUS LIABILITY IN THE LIABILITY SIDE OF THE BALANCE SHEET, THERE SHOULD BE CORRESPONDING ASSET IN THE ASSET SIDE OF THE BALANCE SHEET AND THE LD DR HAS FAILED TO PROVE THE CORRESPONDING ASSET IN THE BALANCE SHEET, THEREFORE, THE M.A. NO.119/KOL/2017 SRI RAVI SHARMA A.Y: 2009-10 5 PLEA OF THE LD DR THAT SAID AMOUNT OF RS. 48,00,000/- IS A BOGUS LIABILITY, IS NOT ACCEPTABLE. BASED ON THE FACTUAL POSITION EXPLAINED ABOVE, WE DO NOT FIND ANY ERROR IN THE ORDER OF THE HONBLE TRIBUNAL DATED 31.01.2017. THEREFORE, WE DISMISS THE MISCELLANEOUS APPLICATION OF THE REVENUE. 5. IN THE RESULT, THE MISCELLANEOUS APPLICATION FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 13/04/2018. SD/ - (S.S.VISWANETHRA RAVI) SD/ - (DR. A. L. SAINI) / JUDICIAL MEMBER / ACCOUNTANT MEMBER /KOLKATA; DATED: 13/04/2018 RS, SPS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT- I.T.O, WARD-51(4), KOLKATA 2. / THE RESPONDENT.- SRI RAVI SHARMA 3. ( ) / THE CIT(A), KOLKATA. 4. / CIT 5. , , / DR, ITAT, KOLKATA 6. [ / GUARD FILE. //TRUE COPY// BY ORDER SENIOR PRIVATE SECRETARY, HEAD OF OFFICE/D.D.O, I.T.A.T, KOLKATA BENCHES, KOLKATA .