Dhanraj Chhaganlal Shah, Pune V. Assistant Commissioner of Income-tax, Circle - 6, Pune

MA 414/PUN/2022

AI Insights

The case involves a Miscellaneous Application by the assessee, Dhanraj Chhaganlal Shah, against an order of the Income Tax Appellate Tribunal, Pune, which had confirmed additions to the assessee's income for the assessment year 2014-15. The additions were made on account of unexplained expenditure amounting to Rs.2,27,27,402 and a provision for warranty of Rs.1,84,93,241. The assessee contended that the Tribunal had incorrectly applied the law and failed to provide an opportunity to be heard regarding the sundry creditors. The Tribunal dismissed the application, stating that the assessee was merely attempting to re-argue the matter under the guise of a rectification application, which is not permissible under section 254(2) of the Act.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 137468 (ITAT-PUNE)
• Duration Of Justice: 8 month(s) 27 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 07-09-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 31-08-2023
• Assessment Year: 2014-2015
• Appeal Filed On: 11-12-2022
• Other Referred Cases: Rotork Controls India (P.) Ltd. vs. CIT, 314 ITR 62 (SC)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: HARI KRISHAN
• Keywords: Unexplained expenditure
• Section: 68; 69C; 254(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “B”, PUNE BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI S. S. VISWANETHRA RAVI, JUDICIAL MEMBER M.A. No.414/PUN/2022 (Arising out of ITA No.2027/PUN/2017) िनधाᭅरण वषᭅ / Assessment Year : 2014-15 Dhanraj Chhaganlal Shah, 1377, Bhawani Peth, Pune- 411042. PAN : AHOPS2401E Vs. DCIT, Circle-6, Pune. Appellant Respondent आदेश / ORDER PER INTURI RAMA RAO, AM: This present Miscellaneous Application is filed by the assessee seeking recall of the order passed by this Tribunal in ITA No.2027/PUN/2017 for the assessment year 2014-15 dated 23.03.2022 on the ground that the addition of Rs.2,27,27,402/- on account of unexplained expenditure u/s 69C of the Income Tax Act, 1961 (‘the Act’) was made by the Assessing Officer for failure of the assessee to discharge the onus of proving the genuineness, Assessee by : Shri Hari Krishan Revenue by : Shri M. G. Jasnani Date of hearing : 01.09.2023 Date of pronouncement : 08.09.2023 MA No.414/PUN/2022 2 creditworthiness and identity of the sundry creditors. It is further submitted that the Tribunal had wrongly applied the law applicable to the provisions of section 68 without giving an opportunity of being heard to the assessee in respect of sundry creditors. Secondly, as regards to the addition of Rs.1,84,93,241/- on account of provision for warranty, it is submitted that the Tribunal has committed a mistake in remanding the issue to the file of the Assessing Officer to follow the law laid down by the Hon’ble Supreme Court in the case of Rotork Controls India (P.) Ltd. vs. CIT, 314 ITR 62 (SC). 2. We had carefully gone through the averments made in the Miscellaneous Petition and heard at length the Authorized Representative of the petitioner. On mere reading of the averments made in the Miscellaneous Petition, it would be clear that the assessee had only made attempt to re-argue the matter in the guise of rectification application, which is not permissible in the proceedings u/s 254(2) of the Act. 3. As regards the addition of Rs.2,27,27,402/- on account of unexplained expenditure, we carefully perused para 18 of the MA No.414/PUN/2022 3 impugned order of the Tribunal (supra) and find that the Tribunal categorically held that even in respect of sundry creditors for supplier the provisions of section 68 applies in full force and admittedly, the addition was made by the Assessing Officer for failure of the assessee to satisfy the Assessing Officer as to the genuineness, creditworthiness and identity of the parties. The Tribunal also categorically recorded a finding that the ld. CIT(A) had granted relief based on the ledger extract of those parties appearing in the books of account of the assessee, which does not satisfy the ingredients of genuineness, creditworthiness and identity of the parties. In the circumstances, the Tribunal had confirmed the addition on account of sundry creditors of Rs.2,27,27,402/-. Thus, the averments made in the Miscellaneous Petition are highly misconceived. It is settled position of law that an item of addition can always be confirmed by the Tribunal if not under one of the provisions of Act or under another provisions of Act. Thus, we do not find any merit in the Miscellaneous Petition filed by the assessee on this issue. MA No.414/PUN/2022 4 4. As regards to the addition on account of provision for warranty, it is undisputed fact that before the Assessing Officer, the assessee had not filed any details of provision for warranty, the ld. CIT(A) merely granted the relief based on the submissions made before him without giving an opportunity of being heard to the Assessing Officer and secondly, the Tribunal remanded only the matter back to the file of the Assessing Officer to allow the provision for warranty keeping view the law laid down by the Hon’ble Supreme Court in the case of Rotork Controls India (P.) Ltd. vs. CIT, 314 ITR 62 (SC). The submissions of the assessee that in the absence of any claim for deduction for provision for warranty, the law laid down by the Hon’ble Supreme Court in the Rotork Controls India (P.) Ltd. (supra) has no application to the facts of the present case and is devoid of merit in view of the fact that the Hon’ble Supreme Court in the said decision (supra) also laid down that the excess provision for warranty should be offered to tax on expiry of warranty period. Therefore, we do not find any mistake apparent from the record capable of being recall in the order MA No.414/PUN/2022 5 passed by this Tribunal (supra). Thus, the Miscellaneous Petition filed by the assessee stands dismissed. 5. In the result, the Miscellaneous Application filed by the assessee stands dismissed. Order pronounced on this 08 th day of September, 2023. Sd/- Sd/- (S. S. VISWANETHRA RAVI) (INTURI RAMA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; ᳰदनांक / Dated : 08 th September, 2023. Sujeet आदेश कᳱ ᮧितिलिप अᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A)-4, Pune. 4. The Pr. CIT-3, Pune. 5. िवभागीय ᮧितिनिध, आयकर अपीलीय अिधकरण, “B” बᱶच, पुणे / DR, ITAT, “B” Bench, Pune. 6. गाडᭅ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune.