SASIKUMAR VIPILLAI, V. ITO 23(3)(4),

MA 718/MUM/2012

• Counselvise Citation: [2013] 124 COUNSELVISE.COM (IT) 0305 (ITAT-MUMBAI)
• Duration Of Justice: 4 month(s) 17 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 17-04-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2007-2008
• Appeal Filed On: 30-11-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: O P MEENA
• Assessee Lawyers: S C TIWARI
• Section: 68

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, M UMBAI BEFORE S/SHRI B.R.MITTAL,(JM) AND RAJENDRA(AM) . . , !' !' !' !' , !# !# !# !# ! !! ! $ $ $ $ M.A.NO.718/MUM/2012 (ARISING OUT OF ./I.T.A.NO.259/MUM/2011) ( % % % % & & & & / ASSESSMENT YEAR :2007-08) SHRI SASIKUMAR V PILLAI, F- 35, SHARDA INDL. ESTATE, LAKE ROAD, BHANDUP (W), MUMBAI- 400078 % % % % / VS. ITO 23(3)(4), MUMBAI. ' !# ./ ( ./PAN NO.AABPP 6472 G ( ') /APPELLANT ) .. ( *+') / RESPONDENT ) ') , ! / APPELLANT BY : SHRI S.C.TIWARI *+') - , ! / RESPONDENT BY : SHRI O.P.MEENA % - .# / DATE OF HEARING : 22.3.2013 /0& - .# / DATE OF PRONOUNCEMENT : 17.4.2013 !1 / O R D E R PER B.R.MITTAL, JM: BY THIS MISCELLANEOUS APPLICATION U/S.254(2) OF TH E INCOME TAX ACT, 1961, THE ASSESSEE HAS STATED THAT THERE ARE CERTAIN MISTAKES IN THE ORDER DATED 7.11.2012 PASSED BY THE TRIBUNAL IN I.T.A. NO.259/M/2011 FOR ASSESSM ENT YEAR 2007-08, WHICH REQUIRE RECTIFICATION. 2. IT IS STATED IN THE APPLICATION THAT THE ORDER P ASSED BY THE TRIBUNAL HAS RESULTED INTO DOUBLE ASSESSMENT OF THE SAME INCOME BECAUSE I T SUSTAINED THE ADDITION TO THE DECLARED INCOME BEYOND THE SCOPE AND OPERATION OF T HE PROVISIONS OF SECTION 68 IN VIEW M.A.NO.718/MUM/2012 2 OF THE FINDINGS GIVEN IN PARA 9 OF THE ORDER OF THE TRIBUNAL. IT IS STATED THAT PROVISIONS OF SECTION 68 ARE NOT APPLICABLE IN RELATION TO THE IM PUGNED ADDITION AND THE PRINCIPAL SUBMISSION HAS NOT BEEN TAKEN INTO CONSIDERATION. THE TRIBUNAL HAS STATED THAT ASSESSEE HAS TO EXPLAIN THE SOURCE OF RECEIPT AS EN TERED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE. THAT LD CIT(A) HAS DISPUTED THE SALES RE CORDED IN THE BOOKS OF ACCOUNT AND ESTIMATED THE SALES AT LOWER FIGURE WHICH SHOULD RE SULT INTO REDUCTION OF INCOME AND NOT ADDITION TO INCOME. IT IS FURTHER STATED THAT THE TRIBUNAL DURING THE COURSE OF HEARING DID NOT ASK FOR ANY INFORMATION OR PARTICULARS FROM THE ASSESSEE AND STATED THAT THE BENCH HEARD THE SUBMISSIONS OF BOTH PARTIES AND, THEREFOR E, IT CANNOT BE INFERRED DURING THE COURSE OF HEARING THAT ASSESSEE COULD NOT GIVE DETA ILS AND DOCUMENTARY EVIDENCE OF SALES OF SCRAP AND PARTIAL RECOVERY FROM THE DEBTOR S, WHICH IN ANY CASE, HAVE BEEN ENTERED IN THE BOOKS OF ACCOUNT FOR ALL TO SEE. IT IS STATED. INTER ALIA, THAT THE TRIBUNAL HAS NOT PROPERLY READ THE ASSESSEES LETTER DATED 24.12 .2009, THE CONTENTS OF WHICH ARE REPRODUCED IN THE ASSESSMENT ORDER AT PAGE 2. HENC E, THERE IS MISTAKE APPARENT ON RECORD IN THE ORDER OF THE TRIBUNAL WHICH REQUIRES RECTIFICATION WITH A VIEW TO AVOID MISCARRIAGE OF JUSTICE. 3. AT THE TIME OF HEARING OF THE APPLICATION, LD A. R. REITERATED ABOVE FACTS. LD A.R. SUBMITTED THAT THE SOURCE OF DEPOSIT IN BANK WAS FR OM CASH BOOK. HE SUBMITTED THAT THERE WERE SALES OF SCRAP AND RECOVERY FROM DEBTORS . LD CIT(A) DID NOT ACCEPT THE SALE OF SCRAPS TO THE EXTENT OF RS.9,71,186 AND REDUCED TO RS.5,92,000. IF THERE IS INFLATION OF SALE, IT RESULTS IN REDUCTION OF SALES AND, THEREFO RE, THE INCOME SHOULD HAVE BEEN REDUCED. HOWEVER, THERE IS AN ADDITION. HENCE, THE ADDITION AS SUSTAINED IS NOT JUSTIFIED. LD A.R. FURTHER SUBMITTED THAT THERE WAS RECOVERY F ROM DEBTORS AND THE SAME WAS NOT EXAMINED BY LD CIT(A). LD A.R. SUBMITTED THAT FINA L COPY OF ACCOUNT WAS FILED ON 18.10.2012 ALONGWITH DETAILS OF DEBTORS AS MENTIONE D IN SCHEDULE -8 AND THE TRIBUNAL HAS NOT CONSIDERED THE SAME. THEREFORE, THERE IS M ISTAKE APPARENT FROM THE RECORD IN THE ORDER OF THE TRIBUNAL TO STATE IN PARA 9 OF THE ORDER THAT ASSESSEE COULD NOT FILE DETAILS OF THE AMOUNT STATED TO HAVE BEEN RECEIVED FROM THE ASSESSEES DEBTORS. HE SUBMITTED THAT THE SAID ORDER OF THE TRIBUNAL BE RE CALLED AND GROUND NOS.1 & 2 OF APPEAL BE RE-ADJUDICATED. 4. ON THE OTHER HAND, LD D.R. SUBMITTED THAT THE TR IBUNAL HAS PASSED A SELF CONTAINED REASONED ORDER AND ASSESSEE BY THIS APPLI CATION SEEKS REVIEW OF THE ORDER OF M.A.NO.718/MUM/2012 3 THE TRIBUNAL. HE SUBMITTED THAT THE TRIBUNAL HAS C ONSIDERED ALL THE FACTS AND HAS GIVEN FINDING CATEGORICALLY THAT MERELY THERE ARE ENTRIES IN THE BOOKS OF ACCOUNT OF RECEIPT OF AMOUNT FROM DEBTORS OUT OF WHICH DEPOSIT WAS MADE I N THE BANK HAS BEEN HELD BY THE TRIBUNAL NOT SUFFICIENT TO EXPLAIN THE SOURCE OF DE POSIT. HE SUBMITTED THAT THERE IS A CONSCIOUS DECISION TAKEN BY THE TRIBUNAL ON THE BAS IS OF FACTS ON RECORD AND CIRCUMSTANCES AND THERE IS NO APPARENT MISTAKE IN T HE ORDER PASSED BY THE TRIBUNAL. LD D.R. REFERRED TO THE DECISION OF HONBLE PATNA HIGH COURT IN THE CASE OF ITO VS. ITAT, 229 ITR 651(PAT), WHEREIN, IT HAS BEEN HELD THAT TH E TRIBUNAL CAN ONLY RECTIFY THE MISTAKE IN THE ORDER PASSED U/S.254(1) OF THE ACT AND CANNO T REVIEW ITS ORDER OR TO SIT IN APPEAL OVER ITS EARLIER ORDER. LD D.R. SUBMITTED THAT THE TRIBUNAL SHOULD DISMISS THE APPLICATION AS IT IS OUTSIDE THE PURVIEW OF SECTION 254(2) OF T HE ACT. 5. WE HAVE CAREFULLY CONSIDERED THE ORDER OF THE TR IBUNAL DATED 7.11.2012 AND THE APPLICATION OF THE ASSESSEE IN THE CONTEXT OF THE S UBMISSIONS MADE BEFORE US. WE AGREE WITH LD D.R. THAT SECTION 254(2) OF THE ACT DOES NO T EMPOWER THE TRIBUNAL TO REVIEW ITS OWN ORDER PASSED UNDER SECTION 254(1) OF THE ACT. 6. WE OBSERVE THAT THE TRIBUNAL IN PARA 6 HAS STATE D THE SUBMISSIONS OF THE ASSESSEE, WHICH HAVE BEEN STATED BEFORE US AT THE T IME OF HEARING OF THE APPLICATION. ON THE BASIS OF SUBMISSIONS OF BOTH PARTIES AND AFT ER CONSIDERING THE ORDERS OF AUTHORITIES BELOW, THE TRIBUNAL HAS GIVEN ITS FINDI NG IN PARA 9 OF THE ORDER AS UNDER: IT IS THE SUBMISSIONS OF LD A.R. THAT WHEN THE D EPOSIT IN THE BANK ACCOUNT COMES FROM BOOKS OF ACCOUNT OF ASSESSEE, TH E SOURCE OF RECEIPT SHOULD BE TREATED AS EXPLAINED. WE DO NOT FIND MER IT ON ABOVE SUBMISSION OF ASSESSEE. THE ASSESSEE HAS TO EXPLAI N THE SOURCE OF RECEIPT AS ENTERED IN THE BOOKS OF ACCOUNT OF ASSES SEE. DURING THE COURSE OF HEARING BEFORE US, LD A.R. MERELY STATED THAT THE SOURCE IN THE BOOKS ENTRIES IN CASH IS PARTIALLY FROM SALE OF SC RAP AND PARTIALLY RECOVERY FROM DEBTORS BUT COULD NOT GIVE DETAILS AND/OR FUR NISH ANY DOCUMENTARY EVIDENCE. CONSIDERING ABOVE FACTS AND THE FACTS AS STATED BY LD CIT(A) THAT THE PURCHASE OF THE ASSESSEE IN THE ASSESSMENT YEAR UNDER CONSIDERATION IS ONLY RS.39,45,761, WE ARE OF THE C ONSIDERED VIEW THAT HE HAS RIGHTLY STATED THAT 15% OF THE AMOUNTS OF PURCH ASE COULD BE TAKEN AS SCRAP SALE WHICH ASSESSEE COULD SELL. THUS, HE HAS ACCEPTED THE SALE OF SCRAP OF RS.5,92,000. LD A.R. COULD NOT PLACE ANY EVIDENCE ON RECORD TO SUPPORT HIS SUBMISSION THAT PARTIAL RECOVERY AS ENT ERED IN THE BOOKS OF ACCOUNT OF ASSESSEE IS BY WAY OF RECOVERY FROM DEBT ORS. LD A.R. DID NOT STATE THE DETAILS OF THE AMOUNT STATED TO HAVE BEEN RECEIVED FROM ASSESSEES DEBTORS. FURTHER DURING THE COURSE OF A SSESSMENT PROCEEDINGS, ASSESSEE VIDE HIS LETTER DATED 24.12.2 009 STATED THAT CASH M.A.NO.718/MUM/2012 4 CREDITS IN THE BANK ARE ON ACCOUNT OF SCRAP SALE AN D PROCESS REJECTIONS AMOUNTING TO RS.9,71,186, WHICH WERE OFFERED FOR TA XATION BUT DURING THE COURSE OF HEARING BEFORE US, ASSESSEE STATED THAT T HE SAID SOURCE OF BANK DEPOSITS AND ENTRIES IN THE BOOKS OF ACCOUNT IS PAR TIALLY SCRAP SALE AND PARTIALLY RECOVERY FROM DEBTORS. CONSIDERING ABOVE FACTS AND SUBMISSIONS OF LD A.R, WE AGREE WITH LD D.R. THAT A SSESSEE HAS NOT BEEN ABLE TO EXPLAIN THE SOURCE OF CASH RECEIPTS WHICH I S STATED TO BE ENTRIES IN THE BOOKS OF ACCOUNT. MERELY THE BANK ACCOUNT IS D ISCLOSED AND ENTRIES ARE REFLECTED IN THE BOOKS OF ACCOUNT, DOES NOT MEA N THAT SOURCE OF RECEIPT IS TO BE TREATED AS EXPLAINED. HENCE, WE R EJECT GROUND NOS. 1 &2 TAKEN BY ASSESSEE. 7. WE OBSERVE THAT ASSESSEE STATED THAT THE DEPOSIT OF CASH IN BANK ACCOUNT NO.50480621000003 AT VIJAY BANK, MULUND WAS CASH D EPOSIT OF RS.35,17,320 ON VARIOUS DATES AND STATED IN REPLAY TO A QUERY RAISE D BY THE AO AS UNDER: THE CASH CREDITS IN TO BANK ARE ON ACCOUNT OF SCRA P SALE AND PROCESS REJECTIONS AMOUNTING TO RS. 9,71,186/- WHICH HAS BE EN DULY OFFERED FOR TAXATION SINCE IT FORMS PART OF LOCAL SALES SHOWN I N MY PROFIT AND LOSS ACCOUNT. FURTHER, I HAVE RECOVERY FROM OPENING DEBT ORS WHICH HAS BEEN DEPOSITED PERIODICALLY. 8. LD CIT(A) CONSIDERED THAT THE TOTAL PURCHASES MA DE BY THE ASSESSEE WHICH WERE REFLECTED AT RS.39,45,761 AND STATED THAT 15% THERE OF IS THE SCRAP SALES WHICH ASSESSEE COULD SELL AND THE AMOUNT COMES TO RS.5,99,864/-. LD CIT(A) AFTER CONSIDERING THE DETAILS AND OBSERVING THAT THERE WERE CONTRADICTORY STATEMENT OF SALE OF SCRAPS STILL CONSIDERED THE DEPOSIT TO THE EXTENT OF RS.5,92,000 AS EXPLAINED ON ACCOUNT OF SALE OF SCRAPS. THE REASONABLENESS OF STATEMENT OF RECEIPT ON ACCOUNT OF SALE OF SCRAP HAS NOT BEEN DISPUTED BY THE ASSESSEE DURING THE COURSE OF HIS SUBMISSION AT THE TIME OF HEARING OF MISCELLANEOUS APPLICATION OR IN THE APPL ICATION ITSELF. THE QUESTION IS ABOUT THE ALLEGED RECOVERY FROM ITS DEBTORS. ASSESSEE AT THE TIME OF HEARING OF APPEAL STATED THAT WHEN THE SOURCE OF BANK DEPOSIT IS EXPLAINED I .E. SAME HAD COME FROM BOOKS OF ACCOUNT, IT SHOULD BE TREATED AS EXPLAINED. IT IS AN ADMITTED FACT THAT NO DOCUMENTS WERE FILED TO ESTABLISH THAT THERE WAS RECOVERY TO THE E XTENT OF RS.29,25,320 (RS.35,17,320 RS.5,92,000) FROM DEBTORS. THE TRIBUNAL HAS TAKEN A CONSCIOUS VIEW THAT ASSESSEE HAS TO EXPLAIN THE SOURCE OF RECEIPT AS ENTRY IN THE BO OKS OF ACCOUNT OF THE ASSESSEE WITH DOCUMENTARY EVIDENCES. SINCE ASSESSEE COULD NOT GI VE THE DETAILS OF THE AMOUNT RECEIVED FROM DEBTORS WITH ANY DOCUMENTS SAVE AND E XCEPT GIVING LIST IN SCHEDULE 8 OF THE SUNDRY DEBTORS, DO NOT ESTABLISH THAT THE AMOUN T TO THE EXTENT OF RS.29,35,320 WHICH WERE DEPOSITED IN THE CASH IN THE ABOVE MENTIONED B ANK ACCOUNT WAS ON ACCOUNT OF RECOVERY FROM DEBTORS AND THE SOURCE IS DEEMED TO H AVE BEEN EXPLAINED AS THE AMOUNT M.A.NO.718/MUM/2012 5 WAS ENTERED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE . WE AGREE WITH LD D.R. THAT ASSESSEE BY THIS APPLICATION WANTS TO REVIEW THE OR DER OF THE TRIBUNAL, WHICH IS OUTSIDE THE PURVIEW OF SECTION 254(2) OF THE ACT. HENCE, T HERE IS NO MISTAKE IN THE ORDER OF THE TRIBUNAL. THE TRIBUNAL HAS GIVEN A CATEGORICAL FIN DING IN PARA 9 OF THE ORDER IN RESPECT OF GROUND NOS.1 & 2 OF APPEAL. THEREFORE, THE MISCELL ANEOUS APPLICATION OF THE ASSESSEE IS REJECTED. 9. IN THE RESULT, MISC. APPLICATION OF THE ASSESSEE IS DISMISSED. 2 .3 % 2. 44 !% #2 - . 56 ORDER PRONOUNCED IN THE OPEN COURT ON 17 TH APRIL, 2013 . !1 - /0& #! 7 8%3 17 TH 0 - 9 SD/- SD/- ( !' , /RAJENDRA ) ( . . /B.R.MITTAL) !# / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI; 8% DATED 17 / 04 /2013 . % . ./ PARIDA , SR. PS !1 !1 !1 !1 - -- - *.4 *.4 *.4 *.4 :!4&. :!4&. :!4&. :!4&. / COPY OF THE ORDER FORWARDED TO : 1. ') / THE APPELLANT 2. *+') / THE RESPONDENT. 3. ; ( ) / THE CIT(A)- 4. ; / CIT 5. 4<9 *.% , , / DR, ITAT, MUMBAI 6. 9= > / GUARD FILE. !1% / BY ORDER, +4. +4. +4. +4. *. *.*. *. //TRUE COPY// 5 (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI