The ACIT, Circle-4, Baroda V. M/s. World Trade Impex Ltd., Baroda

MA 92/AHD/2013

• Counselvise Citation: [2014] 124 COUNSELVISE.COM (IT) 1559 (ITAT-AHMEDABAD)
• Duration Of Justice: 10 month(s) 7 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 26-02-2014
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2003-2004
• Appeal Filed On: 18-04-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: R K DHANESTA SRDR
• Assessee Lawyers: M K PATEL
• Keywords: Gross profit estimation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH AHMADABAD , , , , BEFORE SHRI MUKUL KUMAR SHRAWAT , JUDICIAL MEMBER AND , SHRI T.R. MEENA, ACCOUNTANT MEMBER .. , !' ! # $ ! # $ ! # $ ! # $ M.A. NO. 92/AHD/2013 (IN ITA NO. 731/AHD/2009) ASSESSMENT YEAR :2003-04 A.C.I.T., CRICLE-4, 4 TH FLOOR, AAYAKAR BHAVAN, RACE COURSE CIRCLE, BARODA 390007 V/S . M/S. WORLD TRADE IMPEX LTD., 204, STERLING CENTRE, R.C.DUTT ROAD, ALKAPURI, BARODA PAN NO. AAACW2072K (APPELLANT) .. (RESPONDENT) %& ' ( ! /BY APPELLANT SHRI R. K. DHANESTA, SR.D.R. )*%& ' ( ! /BY RESPONDENT SHRI M. K. PATEL, A.R. +, ' ' /DATE OF HEARING 21.02.2014 -./ ' ' /DATE OF PRONOUNCEMENT 26.02.2014 O R D E R PER : SHRI T.R.MEENA, ACCOUNTANT MEMBER THIS M.A. IS FILED BY THE REVENUE AGAINST THE ORDER PASSED BY THE D BENCH, ON 06 TH MAY, 2009 IN ITA NO. 731/AHD/2009 FOR A.Y. 2003-04 . 2. THE FACTS OF THE CASE IS THAT IN THIS CASE, THE REVENUE HAD FILED THE APPEAL AGAINST THE ORDER DATED 16.12.2008 OF THE LD . CIT(A)-III, BARODA FOR A.Y. 2003-04, WHEREIN REVENUE HAS RAISED TWO GROUND S OF APPEAL, WHICH IS REPRODUCED AS UNDER: 1) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE THE CIT(A) ERRED IN DELETING THE ADDITION OF RS.12,29,895/- MADE ON ACCOUNT OF LOW M.A. NO. 92/AHD/2013 (IN ITA NO. 731/AHD/09), A.Y. 03-04 PAGE 2 GROSS PROFIT, OVERLOOKING THE FACT NO PLAUSIBLE EXP LANATION WAS FURNISHED FOR THE FALL IN GROSS PROFIT. 2) THE APPELLANT CRAVES LEAVE TO ADD, TO AMEND OR A LTER THE ABOVE GROUNDS AS MAY BE DEEMED NECESSARY. THE CO-ORDINATE D BENCH HAD DECIDED THE ISSUE IN ABSENCE OF ASSESSEE AND CONFIRMED THE ORDER OF THE CIT(A). THE REVENUE FIL ED THE M.A. AND THE FACTS OF M.A. IS REPRODUCED AS UNDER: 3. IN THE AFORESAID ORDER, THE HON'BLE ITAT HELD T HAT THE REVENUE IS NOW IN APPEAL BEFORE US AGAINST THE AFORESAID FINDI NGS OF THE LD. CIT (A). THE LD. DR SUPPORTED THE FINDINGS OF THE A.O.. TO A QUERY BY THE BENCH, THE LD. DR WAS NOT ABLE TO CLARIFY AS TO WHETHER OR NOT THE ASSESSEE IS IN APPEAL AGAINST THE IMPUGNED ORDER WHILE THE REGISTR Y INFORMED THAT ASSESSEE HAS NOT FILED ANY APPEAL SO FAR. SINCE, TH E ADDITION ON ACCOUNT OF LOW GROSS PROFIT HAS BEEN DELETED BY THE LD. CIT (A ) ON THE GROUND THAT ADDITION OF RS. 55,43,026/- ON ACCOUNT OF INFLATION IN PURCHASES HAS BEEN UPHELD BY HIM WHILE THE ASSESSEE IS NOT IN APPEAL N OR APPEARED BEFORE US AND THE LD. DR COULD NOT POINT ANY INFIRMITY IN THE AFORESAID FINDINGS OF THE LD. CIT (A), WE DO NOT FIND ANY REASON TO INTERFERE WITH THE FINDINGS OF THE LD. CIT (A). THEREFORE, GROUND NO. 1 IS DISMISSED. 4. NOW THE ASSESSES NAMELY M/S WORLD TRADE IMPEX LT D. HAS FILED CROSS OBJECTIONS BEFORE THE HON'BLE ITAT VIDE CROSS OBJEC TION NO. 87/AHD/2008 IN APPEAL NO. 731/AHD/2009 FOR THE A.Y. 2003-04. ON E OF THE GROUNDS TAKEN BY THE ASSESSEE IN ITS CROSS OBJECTIONS THAT (I) 'THE LD. COMMISSIONER OF INCOME TAX-ILL, BARODA ERRED IN HOLDING THAT THE ASSESSING OFFICER WAS JUSTIFIED IN MAKING AN AD DITION ON ACCOUNT OF ALLEGED INFLATED PURCHASES RS. 55,43,026/-. (II) THE LD. COMMISSIONER OF INCOME TAX-III, BARODA , FURTHER ERRED IN CONFIRMING THE SAID ADDITION OF RS.55,43,026/-. (III) IT IS PRAYED THAT THE ADDITION OF RS. 55 ,43,026/- BE DELETED. 5. THE HON'BLE ITAT DISMISSED THE AFORESAID APPEAL OF THE DEPARTMENT HOLDING THAT THE ADDITION ON ACCOUNT OF LOW GROSS P ROFIT HAS BEEN DELETED M.A. NO. 92/AHD/2013 (IN ITA NO. 731/AHD/09), A.Y. 03-04 PAGE 3 BY THE LD. CIT (A) ON THE GROUND THAT ADDITION OF R S.55,43,026/- ON ACCOUNT OF INFLATION IN PURCHASES HAS BEEN UPHELD B Y HIM WHILE THE ASSESSEE IS NOT IN APPEAL NOR APPEARED BEFORE US AN D THE LD. DR COULD NOT POINT ANY INFIRMITY IN THE AFORESAID FINDINGS O F THE LD. CIT (A), WE DO NOT FIND ANY REASON TO INTERFERE WITH THE FINDINGS OF THE LD. CIT (A). NOW THE ASSESSEE HAS FILED THE CROSS OBJECTIONS IN APPE AL NO. 731/AHD/2008 AND ONE OF THE GROUNDS TAKEN BY THE ASSESSEE IS ADD ITION ON ACCOUNT OF ALLEGED INFLATED PURCHASES-RS.55,43,026/-. THEREFOR E, THE ORDER OF THE HON'BLE ITAT IN ITA NO. 731/AHD/2009 DATED 06.05.20 09 IS REQUIRED TO BE RECALLED FOR FRESH ADJUDICATION IN RESPECT OF ADDIT ION OF RS.12,29,895/- MADE ON ACCOUNT OF LOW GROSS PROFIT AND ADDITION OF RS. 55,43,026/- MADE ON ACCOUNT OF ALLEGED INFLATED PURCHASES. 3. WE HAVE HEARD THE BOTH SIDES AND PERUSED THE MAT ERIAL ON RECORD. THE FACTS ARE THAT THE LD. CIT(A) HAD CONFIRMED THE ADD ITION AGAINST THE ADDITION OF RS.38,57,038/- IN GROUND NO.3 AT RS.33,153/-, RS.5, 74,658/- BY FOLLOWING THE CASE OF IPCL AND BASL. IN CASE OF CREDITOR J. K. ENTERPRISES, BARODA, THE ONE ADDITION OF RS.20,94,941/- HAS BEEN DELETED AND IN CASE OF CREDITOR SWATI PROCESSORS P. LTD., SURAT, THE ADDITION WAS CONFIRM ED AT RS.11,54,286/- ON ACCOUNT OF NONE RECONCILIATION OF THE COPY OF ACCOU NT. THUS, TOTAL ADDITION AT RS.17,62,057/- WAS CONFIRMED BY THE LD. CIT(A) AND REMAINING AMOUNT OF RS.20,94,941/- WAS DELETED. THE CO-ORDINATE BENCH HAS WRONGLY OBSERVED THE DELETION FIGURE AT RS.12,29,895/-. THE A.O. MA DE ADDITION ON ACCOUNT OF LOW GP AT RS.12,29,895/- AND ALSO INFLATED PURCHASE AT RS.55,43,026/-. THE LD. CIT(A) HAD CONFIRMED THE INFLATED PURCHASE AT RS.55,43,026/-. HOWEVER, ADDITION ON ACCOUNT OF LOW GP WAS MADE AT RS.12,29,895/- HAD NOT BEEN CONFIRMED SEPARATELY AS ALREADY ADDITION ON AC COUNT OF INFLATED PURCHASE HAD BEEN CONFIRMED BY THE CIT(A) AND HE HA S GIVEN TELESCOPIC M.A. NO. 92/AHD/2013 (IN ITA NO. 731/AHD/09), A.Y. 03-04 PAGE 4 BENEFIT TO THE ASSESSEE. THEREFORE, IT IS AN APPAR ENT MISTAKE THAT CIT(A) HAS NOT DELETED THE ADDITION OF RS.12,29,895/- ON ACCOU NT OF LOW GP BUT SEPARATE ADDITION HAS NOT BEEN CONFIRMED BY THE CIT(A). FUR THER, ASSESSEE HAS ALSO FILED CROSS OBJECTION NO. 87/AHD/2008 ON 10.05.2009 BEFORE THE ITAT WHICH REQUIRED TO BE HEARD SIMULTANEOUSLY AS HONBLE SUPR EME COURT HAS HELD THAT ITAT HAS TO ENTERTAIN BOTH THE APPEALS TOGETHER. T HEREFORE, WE ALLOW THE M.A. OF THE REVENUE. THE REGISTRY IS DIRECTED TO FIX TH E REVENUES APPEAL AS WELL AS ASSESSEES C.O. TOGETHER. 4. IN THE RESULT, THE REVENUES M.A. IS ALLOWED. THIS ORDER PRONOUNCED IN OPEN COURT ON 26/02/2014 SD/- SD/- ( MUKUL KUMAR SHRAWAT ) (T.R. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER TRUE COPY S.K.SINHA !0 !0 !0 !0 ' '' ' )1 )1 )1 )1 2!1/ 2!1/ 2!1/ 2!1/ / COPY OF ORDER FORWARDED TO:- 1. %& / APPELLANT 2. )*%& / RESPONDENT 3. 6 / CONCERNED CIT 4. 6- / CIT (A) 5. 1:; )+ , , / DR, ITAT, AHMEDABAD 6. ;= >? / GUARD FILE. BY ORDER/ !0 !, @/ B , $