Sri Kamal Deo Sharma, Ranchi V. DCIT,C.C.-1, Ranchi

SA 30/RAN/2019

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 9767 (ITAT-RANCHI)
• Duration Of Justice: 1 month(s) 7 day(s)
• Appeal Type: Income Tax (Transfer Pricing) Appeal
• Pronouncement Date: 05-04-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2014-2015
• Appeal Filed On: 26-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Search and seizure; Application of stay
• Section: 153A; 234B; 2

Judgement Text

1 SP NOS.5-31/RAN/2019 IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI BENCH: E COURT AT KOLKATA ( ) . . , . , ) [BEFORE SHRI A. T. VARKEY, JM & DR. A. L. SAINI, A M] S.P. NOS.5 TO 11/RAN/2019 IN I.T(SS).A. NOS. 42 TO 47/RAN/2019 ASSESSMENT YEARS: 2010-11 TO 2015-16 M/S. RAJAT MINERALS PVT. LTD. (PAN: AACCR6414L) C/O PODDAR LAW CHAMBERS, 501/MAHABIR TOWER, MAIN ROAD, RANCHI-834001. VS. ASSISTANT COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1, RANCHI APPLICANT RESPONDENT & S.P. NOS.12 TO 17/RAN/2019 IN I.T(SS).A. NOS. 48 TO 53/RAN/2019 ASSESSMENT YEARS: 2009-10 TO 2014-15 M/S. K.D.S. CONTRACTOR (P) LTD. (PAN: AACCK5311K) C/O PODDAR LAW CHAMBERS, 501/MAHABIR TOWER, MAIN ROAD, RANCHI-834001. VS. ASSISTANT COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1, RANCHI APPLICANT RESPONDENT & S.P. NOS.18 TO 24/RAN/2019 IN I.T(SS).A. NOS. 27 TO 33/RAN/2019 ASSESSMENT YEARS: 2009-10 TO 2015-16 SMT. TRIPTA SHARMA, RANCHI (PAN: AHVPS5982R) C/O PODDAR LAW CHAMBERS, 501/MAHABIR TOWER, MAIN ROAD, RANCHI-834001. VS. DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1, RANCHI APPLICANT RESPONDENT & S.P. NOS. 25TO 31/RAN/2019 IN I.T(SS).A. NOS. 34 TO 40/RAN/2019 ASSESSMENT YEARS: 2009-10 TO 2015-16 2 SP NOS.5-31/RAN/2019 SHRI KAMAL DEO SHARMA, RANCHI (PAN: ALFPS8806E) C/O PODDAR LAW CHAMBERS, 501/MAHABIR TOWER, MAIN ROAD, RANCHI-834001. VS. ASSISTANT COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1, RANCHI APPLICANT RESPONDENT DATE OF HEARING 15.03.2019 DATE OF PRONOUNCEMENT 15.03.2019 FOR THE APPLICANT SHRI DEVESH PODDAR, ADVOCATE FOR THE RESPONDENT SHRI P. K. MONDAL, ACIT, SR. DR ORDER PER DR. A. L. SAINI, AM BY WAY OF THESE STAY APPLICATIONS, THE ASSESSEES SE EK A STAY ON COLLECTION OF DISPUTED TAX INCLUDING INTEREST, WHICH AROSE OUT OF SEPARATE ORDERS OF LD. CIT(A), RANCHI, WHICH ARE IMPUGNED IN APPEALS BEFORE THIS TRIBUNAL. 2. AT THE OUTSET, WE NOTE THAT THERE ARE 27 STAY AP PLICATIONS FILED BEFORE US. WE NOTE THAT THERE ARE FOUR ASSESSEES OUT OF WHICH THREE AS SESSEES ARE FILED SEVEN APPLICATIONS AND ONE ASSESSEE HAS FILED SIX APPLICATIONS THUS TOTALI NG 27 STAY APPLICATIONS. 3. SINCE THE ISSUE INVOLVED IN ALL THE STAY APPLICA TIONS ARE COMMON AND IDENTICAL, THEREFORE, THESE STAY APPLICATIONS HAVE BEEN HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER. 4. FOR THE SAKE OF CONVENIENCE, FIRST OF ALL, WE N ARRATE THE FACTS AND FIGURES OF THESE ASSESSEES. SINCE ALL ASSESSEES RELATE TO ONE GROUP AND THEY WERE SUBJECTED TO SEARCH AND SEIZURE ACTION CARRIED ON BY THE DEPARTMENT ON 03.0 8.2014 (AY 2015-16), AND THE DEPARTMENT RAISED THE TOTAL DEMAND TO THE TUNE OF R S.410 CRORES (APPROX). THE PERCENTAGE 3 SP NOS.5-31/RAN/2019 OF TOTAL DEMAND PAID BY ALL THE ASSESSEES, TAKING INTO ACCOUNT AS A WHOLE GROUP IS MENTIONED BELOW: IN CRORES (APPROX) TOTAL DEMAND LESS: INTEREST COMPONENT U/S. 234B INCLUDED IN THE TOTAL DEMAND BALANCE DEMAND AFTER INTEREST LESS: RELIEF GIVEN BY LD. CIT(A) BUT AO HAS NOT GI VEN APPEAL EFFECT BALANCE DEMAND LESS: DEMAND PAID BY ASSESSEE BALANCE DEMAND 410 152 258 70 188 62 126 FROM THE STATISTICS MENTIONED ABOVE THE PERCENTAGE OF DEMAND PAID BY ASSESSEE IS WORKED OUT AS FOLLOWS: PERCENTAGE OF DEMAND PAID EXCLUDING INTEREST 33% (62/188X100) 5. CRORE ISSUE IN DISPUTE AND LD. COUNSELS SUBMIS SION: AT THE OUTSET, IT HAS BEEN BROUGHT TO OUR NOTICE TH AT THERE IS A SEARCH AND SEIZURE ACTION ON THE ASSESSEES TRANSIT CAMP OFFICE AT ORI SSA ON 03.08.2014 (AY 2015-16) AND THE DEPARTMENT HAS SEIZED ONLY THE BOOKS OF ACCOUNT OF THE ASSESSEE. ACCORDING TO LD. COUNSEL FOR THE ASSESSEE, THE DEPARTMENT HAS NOT SEARCH THE REGISTERED HEADQUARTER OF THE ASSESSEE OR SEARCHED THE PREMISES WHERE THE ASSESSEE RESIDES. ACCORDING TO LD. COUNSEL, THERE IS NO WHISPER OF ANY INCRIMINATING MATERIALS UNEARTHED DU RING SEARCH AGAINST THE ASSESSEE. ACCORDING TO LD. COUNSEL, THE AO HAS NOT MADE ANY A DDITION BASED ON THE INCRIMINATING MATERIALS, THEREFORE, THE LD. AR RELYING ON THE DEC ISION OF CIT VS . KABUL CHAWLA (2016) 380 ITR 573 (DEL) AND THE DECISION OF HONBLE CALCU TTA HIGH COURT IN THE CASE OF ITA NO. 661 OF 2008 COMMISSIONER OF INCOME TAX VS.VEERPRABH U MARKETING LTD. HAS CONTENDED THAT IN UNABATED ASSESSMENT YEARS NO ADDITION CAN B E MADE WITHOUT THE AID OF INCRIMINATING MATERIAL UNEARTHED DURING SEARCH QUA THAT ASSESSMEN T YEAR. THE LD. COUNSEL ALSO BROUGHT 4 SP NOS.5-31/RAN/2019 TO OUR NOTICE THAT THERE HAS BEEN NO STATEMENT RECO RDED U/S. 132(4) OF THE ACT DURING SEARCH. THEREFORE, THERE IS NO INCRIMINATING MATERIAL AND, THEREFORE, HE CONTENDED THAT THERE COULD NOT HAVE BEEN ANY ADDITION AGAINST THE ASSESSEE. AC CORDING TO LD. COUNSEL, THE LD. CIT(A) HAS GIVEN A RELIEF OF RS.70 CR., FOR WHICH APPEAL E FFECT HAS ALSO NOT BEEN GIVEN BY THE AO. ACCORDING TO LD. COUNSEL, THE INTEREST COMPONENT U/ S. 234B OF THE ACT WHICH THE HONBLE JURISDICTIONAL HIGH COURT IN AJOY PRAKASH VERMA IN TA NO. 38/2010 WHICH IS REPORTED IN (2013) 1 TMI PAGE 140 WHEREIN THE HONBLE HIGH COU RT HAS HELD THAT INTEREST ELEMENT U/S. 234B CANNOT BE ADDED ON THE ASSESSED INCOME BUT ONL Y CAN BE ADDED IN TAKING THE RETURNED INCOME INTO CONSIDERATION. ACCORDING TO LD. COUNSE L, IF THE INTEREST AMOUNT IS KNOCKED OFF THEN THE DEMAND COMES TO RS. 258 CRORES. ACCORDING TO LD. COUNSEL FOR THE ASSESSEE, ASSESSEE HAS DEPOSITED RS. 62 CR. WHICH COMES TO 33 % OF THE DEMAND OF RS. 188 CR. (AFTER GIVING EFFECT TO THE LD. CIT(A)S ORDER OF RS.70 CR .). THEREFORE, THE ASSESSEE RELYING ON THE CIRCULAR OF THE CBDT NO. 1914 OF 1996 ARRIVED BY 2 9.02.2016 WHEREIN THE CBDT HAS CLARIFIED THAT IF THE ASSESSEE DEPOSITED 20% OF THE DEMAND THE STAY MAY BE GRANTED. THEREFORE, HE PRAYS FOR STAY OF THE OUTSTANDING DEM AND AND ALSO A DIRECTION TO BE ISSUED TO THE DEPARTMENT NOT TO TAKE ANY COERCIVE ACTION AGAI NST THE ASSESSEE. 6. PER CONTRA, THE LD. DR APPEARING FOR THE REVENUE VEHEMENTLY OPPOSES ANY BLANKET STAY TO BE GRANTED IN FAVOUR OF THE ASSESSEE. HE, THEREFORE, URGED BEFORE THE BENCH TO GIVE A DIRECTION UPON THE ASSESSEE TO DEPOSIT AT LEAST 50% OF THE OUTSTANDING DEMAND. 7. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MAT ERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF THE APPLICABLE LE GAL POSITION. WE NOTE THAT THE FACTS AFORESTATED ARE NOT IN DISPUTE AND, THEREFORE, NOT BEING REPEATED FOR THE SAKE OF BREVITY. WE NOTE THAT SINCE THERE IS A SEARCH HAPPENED ON 03.08 .2014 AND THE ASSESSEE HAS BROUGHT TO OUR NOTICE THAT THERE HAS BEEN NO INCRIMINATING MAT ERIAL WARRANTING MAKING ANY ADDITIONS IN THE 153A ASSESSMENT PROCEEDINGS AND REGULAR DISALLO WANCES HAVE BEEN MADE ON CERTAIN EXPENSES LIKE OPENING BALANCE OF CREDITORS AND AD H OC DISALLOWANCES. AO ALSO MADE SOME DISALLOWANCES ON THE BASIS OF SOME ANONYMOUS LETTER . WE NOTE THAT THE AVERMENT OF THE LD. COUNSEL FOR THE ASSESSEE THAT THE ADDITIONS HAVE BE EN MADE QUA THE ASSESSMENT YEARS IN 5 SP NOS.5-31/RAN/2019 QUESTION WITHOUT ANY INCRIMINATING MATERIAL, WHICH HAS NOT BEEN CONTROVERTED BY THE LD. DR FOR REVENUE. 8. KEEPING IN MIND THE SUBMISSIONS MADE BY THE ASSE SSEE AND ALSO KEEPING IN MIND THE EXISTENCE OF THE PRIMA FACIE CASE, THE BALANCE OF C ONVENIENCE AND RELATIVE HARDSHIP, WE ARE OF THE VIEW THAT THERE SHOULD BE A STAY OF RECOVERY OF OUTSTANDING DEMAND. SO, PRIMA FACIE THE ASSESSEE HAS MADE OUT A CASE AND THE BALANCE OF CONVENIENCE IS IN ITS FAVOUR AND TO AVOID UNDUE HARDSHIP, WE ARE INCLINED TO GRANT STAY OF THE OUTSTANDING AMOUNT FOR SIX MONTHS OR TILL THE DISPOSAL OF THE APPEAL, WHICHEVE R IS EARLY. THE ASSESSEE SHALL NOT SEEK ANY ADJOURNMENT WITHOUT JUST CAUSE. 9. IN THE RESULT, ALL THE STAY APPLICATIONS OF ASSE SSEE ARE ALLOWED ON THE TERMS AS STATED ABOVE. ORDER IS PRONOUNCED IN THE OPEN COURT. SD/- SD/- (ABY. T. VARKEY) (DR. A. L. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 15 TH MARCH, 2019 JD.(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1. APPLICANT I) M/S. RAJAT MINERALS PVT. LTD. II) M/S. K.D.S. CONTRACTOR (P) L TD. III) SMT. TRIPTA SHARMA, RANCHI IV) SHRI KAMAL DEO SHARMA, RANCHI 2 RESPONDENT ACIT, CENTRAL CIRCLE-1, RANCHI/DCIT, CENTRAL CIRCLE-1, RANCHI. 3. 4. CIT(A)- , RANCHI CIT, RANCHI 5. DR, ITAT, KOLKATA. (SENT THROUGH E-MAIL) / TRUE COPY, BY ORDER, ASSISTANT REGISTRAR