Vrundavan Ginning & Oil Mill, Bhavnagar V. The ITO, Ward-2(4), Bhavnagar

MA 249/AHD/2017

• Counselvise Citation: [2018] 123 COUNSELVISE.COM (IT) 0765 (ITAT-AHMEDABAD)
• Duration Of Justice: 11 month(s) 27 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 08-10-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 11-10-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER MISC. APPLICATION NO.249/AHD/2017 IN ./ ITA.NO.1295/AHD/2015 / ASSTT. YEAR: 2011-2012 VRUNDAVAN GINNING & OIL MILL 12/3, SHOBHAVAD MAHUVA ROAD, TALAJA, DIST: BHAVNAGAR 364 140. VS THE ITO, WARD-2(4) BHAVNAGAR. ! / (APPELLANT) '# ! / (RESPONDENT) ASSESSEE BY : SHRI SAKAR SHARMA, AR REVENUE BY : SHRI MUDIT NAGPAL, SR.DR / DATE OF HEARING : 05/10/2018 / DATE OF PRONOUNCEMENT: 08/10/2018 $%/ O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER PRESENT MISC. APPLICATION IS DIRECTED AT THE INSTAN CE OF THE ASSESSEE POINTING OUT APPARENT MISTAKES IN THE ORDER OF THE TRIBUNAL DATED 4.7.2017 PASSED IN ITA NO.1295/AHD/2015. 2. IN THE MISC. APPLICATION THE ASSESSEE HAS POINTE D OUT CERTAIN ERRORS COMMITTED BY THE TRIBUNAL WHILE ADJUDICATING GROUND S NO.1, 2 AND 3 OF THE APPEAL. THE RELEVANT PART OF PLEADINGS MADE IN THE MA READ AS UNDER: MA NO.248/AHD/2017 2 1.1 APPLICANT SUBMITS THAT WHILE ADJUDICATION FIRS T TWO GROUNDS HONBLE TRIBUNAL ESCAPED ITS ATTENTION TO THE FOLLO WING MATERIAL FACTS WHICH WERE SPECIFICALLY DRAWN TO ITS NOTICE IN THE COURSE OF HEARING: (A) AGRICULTURAL INCOME WAS DISCLOSED BY THE PARTNE RS IN RETURNS FURNISHED IN THE HANDS OF HUE AND COPIES OF RETURNS HAD BEEN FURNISHING INDICATING DISCLOSURE OF AGRICULTURAL IN COME. (B) PARTNERS IN TURN DISCLOSED SHARE IN HUF INCOME IN THEIR INDIVIDUAL RETURNS AND CLAIMED THE SAME AS EXEMPT U/S 10(2). (C) INCOME CLAIMED EXEMPT U/S 10(2) HAS NOT BEEN DI STURBED BY THE ASSESSING OFFICER WHILE MAKING ASSESSMENT. (D) PURCHASES FROM THE PARTNERS AND RELATIVES WERE MADE AT MARKET RATE AND COMPARABLE PURCHASE VOUCHERS ALONG WITH CHART W ERE FURNISHED INDICATING NO EXCESS PAYMENT TO THE PARTNERS AND RE LATIVES. E) THERE WAS COMPLETE QUANTITY TALLY ON DAY TO DAY BASIS. F) THERE WAS NO REJECTION OF BOOK RESULTS. 1.2 IT IS THEREFORE, SUBMITTED THAT 20% DISALLOWANC E HAS BEEN SUSTAINED BY HON'BLE TRIBUNAL WHILE ADJUDICATING GR OUND NOS.1 AND 2 WITHOUT TAKING INTO ACCOUNT THE ABOVE STATED FACTS AND THEREFORE, ORDER OF THE HON'BLE TRIBUNAL NEEDS TO BE RECTIFIED TO TH IS EXTENT AND CONSEQUENTIAL REQUIRED RELIEF IS REQUESTED TO BE GR ANTED. 2. IN PARA 8 OF THE APPELLATE ORDER, HON'BLE TRIBUN AL HAS ADJUDICATED GROUND NOS. 3 RELATING TO ADDITION OF R S. 67,59,613/- ON ACCOUNT OF ALLEGED SUPPRESSION IN VALUE OF CLOSING STOCK. WHILE ADJUDICATING THIS GROUND FOLLOWING SPECIFIC ARGUMEN TS/ DECISIONS HAVE NOT BEEN TAKEN COGNISANCE AND THEREFORE, ORDER SO P ASSED REQUIRES RECTIFICATION: A) NON CONSIDERATION OF ALTERNATIVE ARGUMENT THAT VALU E OF OPENING STOCK OF SUBSEQUENT YEAR NEED TO BE SUBSTITUTED WITH THE ENHANCED VALUE OF CLOSING STOCK OF THIS YEAR IN THE LIGHT OF DECISION OF HON'BLE SUPREME COURT IN THE CASE OF CHAINRUP SAMPATRAM VS CIT 24 I TR 481 (SC). DUE TO THIS REASON INCOME HAS BEEN TAXED TWICE. MA NO.248/AHD/2017 3 B) NON CONSIDERATION OF DECISION OF HON'BLE RAJASTH AN HIGH COURT IN THE CASE OF CIT VS. SINGHAL NATURAL STONE (P) LTD (2011 ) 243 CTR (RAJ) 414 HOLDING THAT THE ASSESSEE IS ENTITLE TO VALUE CLOSI NG STOCK AT REDUCED RATE PARTICULARLY WHEN THE SAME HAS BEEN SOLD IN THE SUC CEEDING PERIOD AT A LESSER RATE. C) CLOSING STOCK WAS SOLD AT A SUBSTANTIALLY LOWER VALUE IN SUCCEEDING YEAR. 3. THE LD.COUNSEL FOR THE ASSESSEE WHILE REITERATIN G THE SUBMISSIONS MADE IN THE MA ALSO CONTENDED THAT THE MISTAKES POINTED OUT IN THE MA ARE APPARENT ON THE FACE OF THE ORDER, AND THEREFORE, I MPUGNED ORDER OF THE TRIBUNAL CITED SUPRA DESERVES TO BE RECTIFIED. THE LD.DR ON THE OTHER HAND SUBMITTED THAT ALL ISSUES POINTED OUT BY THE ASSESS EE IN MA HAVE ALREADY BEEN DEALT WITH BY THE TRIBUNAL IN ITS DETAILED ORDER, A ND THEREFORE, NO FURTHER ADJUDICATION IS REQUIRED. THE ASSESSEE BY FILING M A IS TRYING TO REVIEW THE ORDER WHICH IS NOT PERMISSIBLE IN LAW. ONCE THE TRI BUNAL DECIDED THE ISSUE AND PASSED ORDER, IT BECOMES FINAL AND TRIBUNAL CANNOT SIT ON FOR REVIEWING ITS ORDER. 4. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND GONE TH ROUGH THE RECORD CAREFULLY. WE FIND THAT THE POWER OF RECTIFICATION UNDER SECTION 254 OF THE INCOME TAX ACT CAN BE EXERCISED ONLY WHEN THE MISTA KE, WHICH IS SOUGHT TO BE RECTIFIED, IS AN OBVIOUS PATENT MISTAKE AND APPA RENT FROM THE RECORD AND NOT A MISTAKE, WHICH IS REQUIRED TO BE ESTABLISHED BY ARGUMENTS AND LONG DRAWN PROCESS OF REASONING ON POINTS, ON WHICH THER E MAY CONCEIVABLY BE TWO OPINIONS. WE FIND THAT THE ERROR POINTED OUT BY TH E ASSESSEE QUA GROUNDS NO.1 AND 2 ARE CONCERNED, THE TRIBUNAL IN THE IMPUGNED O RDER HAD DETAILED DISCUSSION FROM PAGE NOS.1 TO 5 OF THE ORDER AND CA ME TO CONCLUSION TO RESTRICT THE DISALLOWANCE TO 20% OF THE PURCHASES MADE FROM THE PARTNERS AND RELATIVE OF THE PARTNERS. IN OTHER WORDS, 80% OF THE PURCHAS ES MADE BY THE ASSESSEE MA NO.248/AHD/2017 4 HAVE BEEN ALLOWED. SIMILARLY, QUA GROUND NO.3 RELATING TO ADDITION OF RS.67,59,613/- ON ACCOUNT OF SUPPRESSION IN THE VAL UE OF CLOSING STOCK IS CONCERNED, THE TRIBUNAL HAS DISCUSSED THE ISSUE FRO M PAGE NO.5 TO 11, AND NOTICED WELL REASONED ORDER OF THE CIT(A), AND THER EAFTER FOLLOWING THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE O F CIT VS. HINDUSTAN ZINC LTD. CAME TO THE CONCLUSION THAT VALUATION OF CLOSING STOCK ADOPTED BY THE ASSESSEE WAS PURELY ADHOC METHOD AND WITHOUT ANY BASIS. WE FIND THAT THE SCOPE OF SUB-SECTION (2) IS RESTRICTED TO RECTI FYING ANY MISTAKE IN THE ORDER WHICH IS APPARENT FROM RECORD AND DOES NOT EXTEND T O REVIEWING OF THE EARLIER ORDER. BY POINTING OUT THE ALLEGED APPARENT ERRORS, THE ASSESSEE IS TRYING TO REVIEW ENTIRE ORDER OF THE TRIBUNAL, WHICH IS NOT P ERMISSIBLE IN LAW. ASSESSEE IN THE PRESENT MA IS MAKING NEW FOUND SUBMISSIONS, AND TRYING TO UNDO THE ORDER IN GUISE OF RECTIFICATION. WE DO NOT FIND ANY MERIT IN THIS APPLICATION OF THE ASSESSEE, BECAUSE THE ISSUES AGITATED IN THE MA HAVE BEEN EXAMINED AND DELIBERATED UPON, AND REACHED A CONCLUSION ON MERIT . THEREFORE, THE SAME DO NOT REQUIRE A FRESH LOOK IN THE FORM OF RECTIFICATI ON, WHICH IS OTHERWISE ALSO NOT PERMISSIBLE IN LAW. 5. IN THE RESULT, MISC. APPLICATION OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE COURT ON 8 TH OCTOBER, 2018 AT AHMEDABAD. SD/- SD/- ( PRADIPKUMAR KEDIA ) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED 08/10/2018