Harsh Filaments Pvt.Ltd., Surat V. The Income tax Officer,Ward-1(2), Surat

MA 206/AHD/2009

• Counselvise Citation: [2011] 123 COUNSELVISE.COM (IT) 7117 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 4 month(s) 3 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 21-10-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2005-2006
• Appeal Filed On: 18-06-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S A BOHRA
• Assessee Lawyers: RASESH SHAH

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, D BENCH, AHMEDABAD BEFORE SHRI D.K. TYAGI, JUDICIAL MEMBER AND SHRI A. K. GARODIA, ACCOUNTANT MEMBER M.A. NO.206/AHD/2009 IN I.T.A. NO. 369/ AHD/2000 (ASSESSMENT YEAR 2005-06) HARSH FILAMENTS P. LTD., 3033, JASH TEXTILE MARKET, RING ROAD, SURAT VS. ITO, WARD 1(2), SURAT PAN/GIR NO. : AAACH1278F (APPELLANT) .. (RESPONDENT) APPELLANT BY: SHRI RASESH SHAH, AR RESPONDENT BY: SHRI S. A. BOHRA, SR. DR DATE OF HEARING: 23.09.2011 DATE OF PRONOUNCEMENT: 21.10.2011 O R D E R PER SHRI A. K. GARODIA, AM:- THIS M.A. IS FILED BY THE ASSESSEE IN WHICH IT IS THE CLAIM OF THE ASSESSEE THAT IN THE COURSE OF HEARING OF APPEAL, T HE ATTENTION OF THE TRIBUNAL WAS DRAWN TO PAGES 17 AND 40 OF THE PAPER BOOK. IT IS SUBMITTED THAT ON PAGE 17 IS ANNEXURE B, WHICH IS A PART OF T AX AUDIT REPORT, AND COMPARATIVE COMPUTATION UNDER THE INCLUSIVE AND EXC LUSIVE METHOD OF VALUING THE STOCK WAS GIVEN AND IT WAS INDICATED IN ANNEXURE B OF THE TAX AUDIT REPORT BY THE AUDITORS THAT THERE IS NO EFFEC T OF DEVIATION FROM SECTION 145A IN PROFIT OR LOSS. IT IS ALSO SUBMITT ED THAT SIMILARLY, PAGE 40 IS P& L ACCOUNT PREPARED AS PER SECTION 145A, WHICH SHOWS THAT GROSS PROFIT AND NET PROFIT REMAINED THE SAME EVEN WHEN EXCISE DUTY IS INCLUDED IN VARIOUS ITEMS. ONE MORE CONTENTION IS RAISED IN THE M.A. THAT SEVERAL JUDGMENTS WERE CITED BEFORE THE TRIBUNAL BU T THE TRIBUNAL DID NOT M.A.NO.206 /AHD/2009 2 TAKE COPIES OF THE DECISIONS ON RECORD AND THESE JU DGMENTS WERE NOT CONSIDERED BY THE TRIBUNAL. IT IS THE SUBMISSION OF THE ASSESSEE THAT BECAUSE OF THESE REASONS, THERE IS AN APPARENT MIST AKE IN THE TRIBUNAL ORDER, WHICH SHOULD BE RECTIFIED. 2. AS AGAINST THIS, IT IS SUBMITTED BY THE LD. D.R. OF THE REVENUE THAT NOT CITING THE CASES OR NOT REPRODUCING ANY ARGUMEN T OF THE ASSESSEE IN THE TRIBUNAL ORDER IS NOT A MISTAKE APPARENT FROM R ECORD AND HENCE, M.A. OF THE ASSESSEE SHOULD BE REJECTED. HE PLACED RELI ANCE ON VARIOUS JUDGEMENTS I.E. JUDGMENT OF HONBLE BOMBAY HIGH COU RT RENDERED IN THE CASE OF CIT VS RAMESH ELECTRIC & TRADING CO. 203 IT R 497 (BOM.) AND JUDGMENT OF HONBLE PATNA HIGH COURT IN THE CASE OF ITO VS ITAT 229 ITR 651 (PATNA). HE ALSO PLACED RELIANCE ON THIRD MEMBER DECISION OF THE TRIBUNAL RENDERED IN THE CASE OF DHARAM CHAND S URANA VS ITO AS REPORTED IN 611 ITD 115 AND ON A TRIBUNAL DECISION IN THE CASE OF HOMI MEHTA & SONS (P) LTD. VS DCIT AS REPORTED IN 63 ITD 15. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS, PERUSE D THE MATERIAL ON RECORD AND HAVE GONE THROUGH THE JUDGMENTS CITED BY THE LD. D.R. OF THE REVENUE. REGARDING THIS ASPECT THAT SOME OF THE DE CISIONS CITED BY THE LD. A.R. OF THE ASSESSEE IN THE COURSE OF HEARING O F APPEAL WERE NOT TAKEN ON RECORD BY THE TRIBUNAL, WE FIND THAT THERE IS NO MERIT IN THIS ARGUMENT BECAUSE THERE IS NO EVIDENCE THAT ANY SUCH JUDGMENT WAS CITED BY THE LD. A.R. HENCE, THIS ARGUMENT OF THE ASSESSEE IN THE M .A. IS LIABLE TO BE REJECTED AND WE REJECT THE SAME. ACCORDINGLY, THE CONTENTION OF THE LD. D.R. AND VARIOUS JUDGMENTS CITED BY HIM ARE ALSO NO T RELEVANT BECAUSE THIS ASPECT IS ALREADY REJECTED BY US. 4. NOW, WE CONSIDER THE FIRST TWO ARGUMENTS RAISED BY THE ASSESSEE IN THE M.A. THAT PAGES 17 AND 40 OF THE PAPER BOOK WER E NOT CONSIDERED BY THE TRIBUNAL IN THE IMPUGNED TRIBUNAL ORDER. AS PE R PAGE 17 OF THE PAPER BOOK FILED AT THE TIME OF HEARING OF APPEAL, IN ANN EXURE B, IT IS REPORTED M.A.NO.206 /AHD/2009 3 BY THE TAX AUDITORS THAT IF TAX AND DUTY IS INCLUDE D IN RAW MATERIAL CONSUMED AND INVENTORY THEN ALSO, THERE IS NO EFFEC T ON PROFIT OR LOSS. ON PAGE 40 OF THE PAPER BOOK IS PROFIT & LOSS ACCOUNT PREPARED AS PER SECTION 145A OF THE INCOME TAX ACT, 1961, ON THE BASIS OF I NCLUSIVE METHOD AND THE PROFIT WORKED OUT IS THE SAME RS.35,18,175/- AS REPORTED BY THE ASSESSEE IN THE AUDITED P & L ACCOUNT, WHICH IS AVA ILABLE ON PAGE 30 OF THE PAPER BOOK. IN THE IMPUGNED TRIBUNAL ORDER, TH ERE IS NO REFERENCE TO THESE TWO PAGES OF THE PAPER BOOK AND THIS ARGUMENT OF THE ASSESSEE WAS LOST SIGHT OF, WHILE DECIDING THE ISSUE. ONCE IT IS CLAIMED BY THE ASSESSEE THAT THERE IS NO IMPACT ON THE PROFIT OF THE ASSESS EE EVEN BY INCLUDING THE TAX AND DUTIES IN PURCHASE, SALE AND INVENTORY AND IT IS SUPPORTED BY TAX AUDIT REPORT ALSO, THE SAME HAS TO BE CONSIDERED BE FORE DECIDING THE MATTER BUT SINCE IT WAS NOT DONE, WE FEEL THAT THER E IS APPARENT MISTAKE IN THE TRIBUNAL ORDER, WHICH SHOULD BE RECTIFIED. SIN CE THE APPEAL WAS HEARD AND DECIDED BY A DIFFERENT COORDINATE BENCH OF THE TRIBUNAL, IT WOULD BE PROPER TO RECALL THE IMPUGNED TRIBUNAL ORDER FOR A FRESH DECISION ON THIS ASPECT. WE, THEREFORE, RECALL THE IMPUGNED TRIBUNA L ORDER FOR A FRESH DECISION OF GROUND NO.2 OF THE APPEAL REGARDING THE ADDITION MADE BY THE A.O. OF RS.4,84,912/- ON ACCOUNT OF EXCISE DUTY ON CLOSING STOCK. THE REGISTRY IS DIRECTED TO FIX THIS APPEAL FOR HEARING OF THIS ISSUE ONLY IN DUE COURSE BY ISSUING NOTICES TO BOTH THE SIDES. 5. IN THE RESULT, M.A. STANDS ALLOWED IN TERMS INDI CATED ABOVE. 6. ORDER PRONOUNCED IN THE OPEN COURT ON 21 ST OCT., 2011. SD./- SD./- (D.K. TYAGI) (A. K. GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED :21.10. 2011 SP M.A.NO.206 /AHD/2009 4 COPY OF THE ORDER FORWARDED TO: 1. THE APPLICANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE LD. CIT (APPEALS) 5. THE DR, AHMEDABAD BY ORDER 6. THE GUARD FILE AR,ITAT,AHMEDABAD 1. DATE OF DICTATION 17/10 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER18/10 OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P .S./P.S.19/10 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 21/10/2011 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S./P.S.21/10 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 21/10/2011 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK .. 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER . 9. DATE OF DESPATCH OF THE ORDER. ..