HARISH KUMAR RAIMALANI, Ajmer V. DCIT, Ajmer

MA 4/JPR/2012

• Counselvise Citation: [2015] 124 COUNSELVISE.COM (IT) 3241 (ITAT-JAIPUR)
• Duration Of Justice: 3 year(s) 5 month(s) 4 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 17-07-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 16-11-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 13-02-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: NEENA JEPH JCIT DR DHK
• Section: 142(1); 133A

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH VKJ-IH-RKSYKUH] U;KF;D LNL; ,OA JH VH-VKJ-EHUK] YS[KK LNL; DS LE{K BEFORE: SHRI R.P. TOLANI, JM & SHRI T.R. MEENA, AM M.A. NO.04/JP/2012 (ARISING OUT OF VK;DJ VIHY LA-@ ITA NO.327/JP/2011) FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2007-08 SHRI HARISH KUMAR RAIMALANI PROP.: M/S. DETA RAM GOLUMAL, NAYA BAZAR, AJMER CUKE VS. THE DCIT CIRCLE- 1 AJMER LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: AFMPR 6417 H VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI MAHENDRA GARGIEYA, ADVOCATE JKTLO DH VKSJ LS@ REVENUE BY : SMT. NEENA JEPH, JCIT - DR LQUOKBZ DH RKJH[K@ DATE OF HEARING : 19/06/2015 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 17/07/2015 VKNS'K@ ORDER PER T.R. MEENA, AM THE ASSESSEE HAS FILED A MISCELLANEOUS APPLICATION AGAINST THE ORDER OF THIS BENCH DATED 30-09-2011 FOR THE ASSESS MENT YEAR 2007-08 U/S 254(2) OF THE ACT. THE ASSESSEE HAS CLAIMED IN HIS MISCELLANEOUS APPLICATION THAT FOLLOWING MISTAKES ARE APPARENT FR OM RECORD. GOA 2: ADDITION OF RS. 29,79,970/- ON ACCOUNT OF EXCESS STOCK OF GOLD AND SILVER:- 3.1 THE ITAT AT SEVERAL PLACES STATED THAT THE ASSE SSEE WAS NOT WILLING TO PRODUCE BOOKS OF ACCOUNT AND ALS O THAT MA NO.04/JP/2012 HARISH KUMAR RAIMALANI VS. DCIT, CIRCLE- 1, AJMER . 2 BOOKS OF ACCOUNT WERE NEVER PRODUCED BEFORE THE AO, HOWEVER, ITS KIND ATTENTION ESCAPED THE SPECIFIC PR OVISIONS OF SECTION 142(1)(II) WHICH EMPOWERS THE AO TO CALL FO R THE BOOKS OF ACCOUNT. THE ASSESSEE DID MAINTAIN ACCOUNT AND GOT THEM AUDITED, OF COURSE AFTER CONDUCTING OF THE SUR VEY BUT THE FACTS REMAINS THAT THE AO NEVER ISSUED ANY NOT ICE U/S 142(1) (II) OR UNDER ANY OTHER PROVISIONS OF THE AC T CALLING FOR THE ACCOUNTS THOUGH ADMITTEDLY TAR WAS SUBMITTE D (PG 8 PR VIII) AT ALL STAGES INCLUDING THE ITAT (PB 8-1 7). THE AO RATHER IGNORED SUCH ACCOUNTS. MOREOVER, PG 15, PR. 1.2 REMAINED TO BE CONSIDERED). 3.2 DECISION CIT VS. DHINGRA METAL WORKS (2010) 328 ITR 0384 (DEL.) (PG 27 OF TO) AND VARIOUS OTHER DEC ISIONS OF THIS LINE WERE CITED IN WRITTEN SUBMISSIONS (REPROD UCED AT PG 26), HOWEVER, HAVE ESCAPED KIND ATTENTION OF THE IT AT AND HAS NOT AT ALL BEEN DEALT WITH. NON-CONSIDERATION O F A DECISION THOUGH CITED, CERTAINLY CONSTITUTE A MISTA KE APPARENT. 3.3 THE ITAT AT PG 19, PR. 3.9 W.R.T. THE STOCK TUR NOVER RATIO OF EARLIER YEARS TO ASCERTAIN THE DISCLOSED S TOCK THIS YEAR, OBSERVED THAT THE THE ASSESSEE IN HIS STATE MENT MENTIONED THAT HE WAS DISCLOSING ALL THE FOUR ITEMS OF TRADING ACCOUNT ON ESTIMATE BUSINESS. HENCE, IT IS NOT POS SIBLE TO ACCEPT THE CONTENTION OF THE LD. AR . (I) THE REF ERRED STATEMENTS ARE SURVEY STATEMENTS AND DHINGRA METALS (SUPRA) AND OTHER CASES HAVE NOT BEEN CONSIDERED (II) THIS FACT IS NOT SUPPORTED BY ANY OTHER CORROBORATIVE EVIDENCE (III) THE LOWER AUTHORITIES HAS ACCEPTED THE ACCOUNTS UPTO A.Y. 200 6-07 BY CONSIDERING THE OPENING STOCK OF RS. 13,79,910/- AS ON 31- 03-2006 AS ALSO THE HON'BLE ITAT (PR. 3 ABOVE). 3.5 THE ITAT AGAIN AT PG 21, PR. 3.14 IN A CHART PR EPARED BY THEM COMPUTED INCREASE OF 5.34% IN TURNOVER AS AGAINST THE CORRECT 534%. THIS MISTAKE HAS A DIRECT AND VIS IBLE IMPACT ON THE NEXT FOLLOWING MISTAKE AND OVER THE U LTIMATE RESULT. 3.6 THE HON'BLE ITAT AT PG 21 PR. 3.15 STATED THAT THERE IS NO EXPLANATION AS TO WHY THERE IS SUDDEN FALL IN MA NO.04/JP/2012 HARISH KUMAR RAIMALANI VS. DCIT, CIRCLE- 1, AJMER . 3 GROSS PROFIT RATE. HOWEVER, AN EXPLANATION BEHIND THE DECREASE WAS ALREADY AVAILABLE BUT ESCAPED KIND ATT ENTION INASMUCH AS THAT THE DECLARE SALE THIS YEAR HAS SUB STANTIALLY INCREASED MANY TIMES MORE THAN THE PRECEDING YEAR. CONSIDERING THE CORRECT FACT WILL CERTAINLY JUSTIFY THE DECLARED GROSS PROFIT RATE OF 7.34% AND CONSIDERING ALL THE ELEMENTS OF THE TRADING ACCOUNT, A FAIR ESTIMATION OF THE RECORDED CLOSING STOCK , IN ABSENCE OF ACCOUNTS COU LD BE DONE, IF READY IN THE LIGHT OF PG 15, PR. 1.3. 3.7 THE ITAT COMPLETELY IGNORED SOME IMPORTANT CONTENTIONS (PS 16-17, PR. 3.7) THAT THE STOCK OF R S. 52,87,062/- FOUND ON SURVEY ALSO CONSISTED OF STOCK OF RS. 12,91,360/- OF THE CLIENTS AND THUS, IT WAS ONLY ST OCK OF RS. 39,95,702/- WHICH WOULD HAVE BEEN CONSIDERED. THE A DDITION WAS TO BE REDUCED TO THIS EXTENT. SUCH MISTAKE HAS A DIRECT IMPACT OVER THE ULTIMATE RESULT. 3.8 THE ITAT AT PG 19 PR. 3.9 STATED THAT AS PER SECTION 69A, THE ASSESSEE WAS REQUIRED TO EXPLAIN THE SOURC E OF ACQUISITION AND ASSESSEE IS SIMPLY RELYING ON STOCK /TURNOVER RATIO. HOWEVER, THE HON'BLE ITAT HAS IGNORED THE ASSESSEE'S CONTENTION REGARDING SOURCE BEING FROM T HE BOOKS OF ACCOUNT THOUGH MAINTAINED AFTER SURVEY REMAINING UN- REJECTED (PG 4, PR. 5) AND THE HUGE AMOUNT OF SALE OF RS. 94.05 LACS DECLARED AND ADMITTED BY THE AUTHORITIES BELOW (PG 5 PR. 2.6 AN PG 3 PR. 2.4) WHICH ITSELF EXPLAIN THE SOURCE. GOA : 3 ADDITION OF RS. 25,23,200/- ON ACCOUNT OF INVESTMENT IN HOUSE PROPERTY. 2.1 THE HON'BLE ITAT AT PAGE 30 PR. 4.7 OBSERVED TH AT NO DETAILS OF LOANS AND ADVANCES SHOWN AT RS. 9,45,669 /- HAVE BEEN FILED BEFORE THE LOWER AUTHORITIES WHICH IS HO WEVER, CONTRARY TO THE RECORDS AS THE SAME ARE AVAILABLE A S A PART OF TAR PLACED AT PB 16 RIGHT FROM THE AO TO THE HON'BL E ITAT. 2.2 THE SUBMISSION OF THE ASSESSEE EXPLAINING THE S OURCE OF INVESTMENT, PARTICULARLY W.R.T. RS. 10,00,000/- (REPRODUCED AT PG PR. 4.5) AND A CHART, FILED ALONGWITH THE WS , HAS MA NO.04/JP/2012 HARISH KUMAR RAIMALANI VS. DCIT, CIRCLE- 1, AJMER . 4 ESCAPED FULL ATTENTION OF THE HON'BLE BENCH. THERE IS NO REFERENCE IN TO THAT THE AMOUNT WERE GIVEN OUT OF T HE SALE PROCEEDS WHEREAS AT PG 2 PR. 3.15 THE HON'BLE ITAT OBSERVED THAT SALE PROCEEDS WERE DIVERTED FOR THIS PURPOSE. WE HAVE ALSO NOTICED..THE STOCK. 2.3 THE ITAT AT PG 31 PR. 4.7 INCORRECTLY RECORDED A FACT THAT THE ASSESSEE RECEIVED RS. 2.25 LACS FROM HIS D AUGHTER IN LAW AS AGAINST THE CORRECT AMOUNT OF RS. 1,76,800/- . 2.4 IT IS ALSO INCORRECTLY STATED THAT THE SALES PR OCEEDS OF THE CAR HAS BEEN DEPOSITED IN THE BANK ACCOUNT OF T HE SON. SUCH FINDINGS ARE CONTRARY TO ITS OWN READING OF AO S ORDER AT PG 23 PR. 4.2 GOA 4: ADDITION OF RS. 4,65,919/- IN RESPECT OF I NVESTMENT IN PAWNING. THE ITAT AT PG 35 PR.5.7 HAS MENTIONED IN THE LAST LINE THAT THE ADDITION OF RS. 4,97,731/- IS TO BE REDUCED BY RS. 3,95,500/- AND THE BALANCE ADDITION OF RS. 1,02,231 /- WAS SUSTAINED WHEREAS THE CORRECT FIGURE OF THE ADDITIO N MADE BY THE AO (AS NOTED BY THE ITAT AT PG 33 PR. 5.3) WAS OF RS. 4,65,919/- ONLY INSTEAD OF RS. 4,97,731/-. ACCORDIN GLY, THE CORRECT AMOUNT OF ADDITION SUSTAINED SHOULD BE RS. 70,419/- INSTEAD OF RS. 1,02,231/-. 2.1 THE CASE OF THE ASSESSEE WAS HEARD. THE LD. AR SUBMITTED THAT WHILE DEALING WITH GROUND NO. 2, THE COORDINATE BEN CH IN RESPECT OF STOCK OBSERVED THAT WE HAVE ALSO NOTICED THAT ASSESSEE PAID SUBSTANTI AL AMOUNTS FOR PURCHASE OF HOUSE FROM NOV. 2006 TO MAR CH 2007 AND HENCE THE SALE PROCEEDS WERE DIVERTED AND FUNDS WERE SUBS TANTIALLY NOT AVAILABLE FOR KEEPING THE STOCK. THE HON'BLE BENCH ALSO IGNORED THESE FINDINGS AGAINST GROUND NO. 3. WITH RESPECT OF PAYM ENT MADE TO THE SELLER MA NO.04/JP/2012 HARISH KUMAR RAIMALANI VS. DCIT, CIRCLE- 1, AJMER . 5 TO THE EXTENT OF RS. 10.00 LACS. THE FACT OF TRANSF ER OF RS. 5.00 LACS EACH TO THE RESPECTIVE BANK ACCOUNTS OF THE SON AND WIFE IS NEITHER DENIED NOR DISPUTED. BEFORE THE AO IN RESPECT OF GROUND NO. 3 , THE ASSESSEE SUBMITTED THAT A SUM OF RS. 1,76,800/- GIVEN BY THE DAUGHTER-IN-LAW OUT OF THE SALE PROCEEDS OF CAR AMOUNTING TO RS. 2.25 L ACS DEPOSITED IN HER BANK ACCOUNT AND AFTER WITHDRAWING THEREFROM THIS A MOUNT WAS GIVEN TO THE ASSESSEE. THE SON NAMELY SHRI PRADEEP KUMAR ALS O GAVE A AMOUNT OF RS. 3.20 LACS FROM HIS SAVING BANK ACCOUNT. THE ITA T WHILE CONSIDERING THIS ASPECT APPEARED TO HAVE MIXED UP TWO DIFFERENT ISSUES INCORRECTLY. THERE WAS A SURVEY IN THE CASE OF THE ASSESSEE AND NO BOOKS OF ACCOUNT WERE FOUND / MAINTAINED BY THE ASSESSEE . THEREAFT ER, THE BOOKS OF ACCOUNT WERE PREPARED ON THE BASIS OF SURVEY PAP ERS AND WERE GOT AUDITED BY THE AUDITORS. THIS FACT HAS BEEN ADMITTE D BY THIS BENCH OF ITAT IN ITS DECISION. THE AO HAS NOT ASKED THE ASSE SSEE TO PRODUCE THE BOOKS OF ACCOUNT AT THE TIME OF ASSESSMENT AND EVEN THE BOOKS WERE PREPARED AFTER SURVEY OPERATIONS. THE AO NEITHER AS KED TO PRODUCE THE BOOKS OF ACCOUNT NOR REJECTED THE BOOK RESULT BEFOR E ESTIMATING INCOME. HON'BLE ITAT ALSO ESCAPED ATTENTION REGARDING NON- REJECTION OF BOOKS OF ACCOUNT AT THE TIME OF PASSING OF AN ORDER. HON'BLE ITAT HAS NOT CONSIDERED THE CASE LAWS CITED BY THE LD. AR I.E. C IT VS. DHINGRA METAL WORKS 328 ITR 384 (DEL.) AND VARIOUS OTHER DECISION S THOUGH CITED. THE MA NO.04/JP/2012 HARISH KUMAR RAIMALANI VS. DCIT, CIRCLE- 1, AJMER . 6 STATEMENT RECORDED U/S 133A OF THE ACT IS NOT BINDI NG AND IT DOES NOT HAVE EVIDENTIARY VALUE. IT IS FURTHER ARGUED THAT N ON-CONSIDERATION BY THE TRIBUNAL OF A SUPREME COURT JUDGEMENT RELEVANT TO T HE POINT IN ISSUE WOULD GIVE RISE TO A MISTAKE APPARENT FROM RECORD WHICH CAN BE RECTIFIED U/S 254(2) OF THE ACT . HE RELIED ON THE DECISION O F HON'BLE SUPREME COURT IN THE CASE OF ACIT VS. SURASHTRA KUTCH STOCK EXCHANGE LTD. (2008) 305 ITR 227 AND OTHER CASE LAWS ALSO. THE LD . AR SUBMITTED THAT ITAT ALSO COMMITTED A MISTAKE AT PAGE 21 PARA 3.15 IN ITS ORDER ON NO EXPLANATION FOR DECLINE IN GROSS PROFIT RATE AS FAC TS AND FIGURES WERE SUBMITTED BY THE ASSESSEE WHICH IMPLIED THE INCREAS E IN TURNOVER AND DECLINE IN GROSS PROFIT RATE. THE LOWER AUTHORITIES ACCEPTED THE OPENING STOCK, SALES AND PURCHASE AND ALSO PUTTING THE GRO SS PROFIT RATE AS DECLARED, THE CONSEQUENT BALANCING FIGURER SHALL RE PRESENT THE AMOUNT OF THE CLOSING STOCK WHICH COULD BE TREATED AS REASON ABLY AVAILABLE AS PER BOOKS OF ACCOUNT AND THE DIFFERENT IN STOCK COULD H AVE BEEN ADDED. THIS WAY RECASTED TRADING ACCOUNT COULD HAVE BEEN PREPAR ED WHICH OTHERWISE IS A NORMAL PRACTICE BEING ADOPTED BY THE DEPARTMEN T IN SUCH CASES. THIS BENCH OF ITAT HAS ESCAPED ITS ATTENTION ON CLOSING STOCK AS PER AUDITED BALANCE SHEET AS ON 31-03-2007. ON THIS BASIS, THE ADDITION ON ACCOUNT OF STOCK SHALL REMAIN AT RS. 7.00 LACS. THE ITAT HAD COMPLETELY IGNORED THE MA NO.04/JP/2012 HARISH KUMAR RAIMALANI VS. DCIT, CIRCLE- 1, AJMER . 7 CONTENTIONS RAISED BY THE ASSESSEE ON EXCESS STOCK. THE LD. AR OF THE ASSESSEE RELIED ON FOLLOWING CASE LAWS. 1. CHAMPA LAL CHOPRA (2002) 257 ITR 74 (RAJ.) 2. CIT VS. RAMESH CHAND MODI(2001)249 ITR 323 (RAJ.) 3. HONDA SIEL PRODUCT LTD. VS. CIT 295 ITR 466 (SC) THE LD. AR OF THE ASSESSEE REQUESTED TO RECTIFY THE APPARENT MISTAKES COMMITTED BY THE BENCH OF ITAT. 2.2 AT THE OUTSET, THE LD. DR VEHEMENTLY SUPPORTED THE ORDER OF ITAT AND ARGUED THAT ALL THE EVIDENCES TO THIS CASE HAVE BEEN APPRISED BY THE BENCH OF ITAT. NOW THE ASSESSEE WANTS TO REVIEW TH E ORDER OF ITAT WHICH IS NOT PERMISSIBLE U/S 254(2) OF THE ACT. AS SUCH, THERE IS NO APPARENT MISTAKE IN THE ORDER OF ITAT. THEREFORE, T HE MISCELLANEOUS APPLICATION FILED BY THE ASSESSEE DESERVES TO BE DI SMISSED. 2.3 WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. WE HAVE GONE THROUGH THE ORDER OF ITAT DATED 30- 09-2011 IN THE CASE OF THE ASSESSEE AND WHATEVER SU BMISSIONS MADE BY THE ASSESSEE AT THE TIME OF HEARING OF THE APPEAL H AS BEEN CONSIDERED BY THIS COORDINATE BENCH AND DECIDED THE CASE ISSUE-WI SE ON MERITS. WE HAVE ALSO VERIFIED THE ISSUES RAISED BY THE ASSESSE E FROM THE ASSESSMENT ORDER AND FOUND THAT THESE ISSUES HAVE BEEN DECIDED BY THIS BENCH AFTER CONSIDERING THE ASSESSEE'S EVIDENCES AVAILABLE AT T HE TIME OF HEARING. FROM THE MISCELLANEOUS APPLICATION FILED BY THE ASS ESSEE, WE FIND THAT MA NO.04/JP/2012 HARISH KUMAR RAIMALANI VS. DCIT, CIRCLE- 1, AJMER . 8 THE ASSESSEE WANTS TO GET TRIBUNAL ORDER REVIEWED W HICH IS NOT PERMISSIBLE U/S 254(2) AS THERE IS NO INFIRMITY IN THE ORDER. THEREFORE, WE DISMISS THE MISCELLANEOUS APPLICATION FILED BY THE ASSESSEE. 3.0 IN THE RESULT, THE MISCELLANEOUS APPLICATION OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 17/07/201 5. SD/- SD/- VKJ-IH-RKSYKUH VH-VKJ-EHUK (R.P.TOLANI) (T.R. MEENA) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 17 /07/2015 *MISHRA VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI HARISH KUMAR RAIMALANI, AJMER 2. IZR;FKHZ@ THE RESPONDENT- THE DCIT, CIRCLE- 1,AJMER 3. VK;DJ VK;QDRVIHY@ CIT(A). 4. VK;DJ VK;QDR@ CIT, 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (MA NO.04/JP/2012) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR