M/s Krishna Enterprises,, Gwalior v. ITO-1(1), Gwalior

CO 21/AGR/2008 | 2002-2003
Pronouncement Date: 31-03-2011 | Result: Dismissed

Appeal Details

RSA Number 2120323 RSA 2008
Assessee PAN AAAAK6198E
Bench Agra
Appeal Number CO 21/AGR/2008
Duration Of Justice 2 year(s) 11 month(s) 7 day(s)
Appellant M/s Krishna Enterprises,, Gwalior
Respondent ITO-1(1), Gwalior
Appeal Type Cross Objection
Pronouncement Date 31-03-2011
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted DB
Tribunal Order Date 31-03-2011
Date Of Final Hearing 15-03-2011
Next Hearing Date 15-03-2011
Assessment Year 2002-2003
Appeal Filed On 23-04-2008
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH AGRA BEFORE SHRI P.K. BANSAL ACCOUNTANT MEMBER AND SHRI H.S. SIDHU JUDICIAL MEMBER ITA NO.339/AGR/2007 ASST. YEAR: 2002-03 INCOME TAX OFFICER 1(1) VS. M/S KRISHNA ENTERPR ISES THROUGH GWALIOR (M.P.) SHRI SUBHASH KHUSIRAMANI B-117 KRISHNA VIHAR COLONY LASHKAR GWALIOR (M.P.). (PAN : AAAAK 6198 E). C.O. NO.21/AGR/2008 (IN ITA NO.339/AGR/2007) ASST. YEAR: 2002-03 M/S KRISHNA ENTERPRISES THROUGH VS. INCOME TAX OF FICER 1(1) SHRI SUBHASH KHUSIRAMANI GWALIOR (M.P.). B-117 KRISHNA VIHAR COLONY LASHKAR GWALIOR (M.P.). (PAN : AAAAK 6198 E). (APPELLANTS) (RESPONDENTS) REVENUE BY : SHRI VINOD KUMAR JR. D.R. & SHRI N.K. UMEDKER I.T.O. ASSESSEE BY : SHRI NAVIN GARGH ADVOCATE & SHRI ASHOK VIJAYWARGIYA C.A. ORDER PER BENCH : THE REVENUE HAS FILED THE PRESENT APPEAL AGAINST TH E ORDER DATED 30.05.2007 PASSED BY THE CIT(A) GWALIOR ON THE FOLLOWING GROU NDS. THE ASSESSEE HAS ALSO 2 FILED CROSS OBJECTION ON THE FOLLOWING GROUNDS WHIC H IS BARRED BY LIMITATION OF 117 DAYS : 2. GROUNDS IN ITA NO.339/AGR/2007 :- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE THE LD. COMMISSIONER OF INCOME-TAX (A) HAS ERRED IN LAW AND FACTS IN DELETING AN ADDITION OF ` 6 50 010/- MADE BY THE A.O. U/S. 69 OF THE INCOME T AX ACT 1961. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE LD. COMMISSIONER OF INCOME-TAX (A) HAS ERRED IN LAW AND FACTS IN RESTRICTING THE ADDITION OF ` 10 50 010/- TO ` 4 00 000/- AFTER TELESCOPING OF ` 1 00 000/- OF ADDITION SUSTAINED DURING PRECEDING Y EAR ESPECIALLY WHEN THE ASSESSEE HAS NOT WITHDRAWN CASH FROM THE BANK ACCOUNT. SIMULTANEOUSLY THE ASSESSEE DEPOSITED THE CASH OF ` 10 50 010/- IN THE BANK ACCOUNTS ON VARIOUS DATES A ND IMMEDIATELY AFTER THE DEPOSIT OF CASH ISSUED CHEQUES IN VARIOUS NAMES (WHICH ARE GIFTED TO THOSE PERSONS) AND THEREFORE THE AMOUNT HAS NOT PLOUGHED BACK IN THE HANDS OF THE ASSESSEE. 3. THE APPELLANT RESERVES HIS RIGHT TO ADD AMEND O R ALTER THE GROUNDS OF APPEAL ON OR BEFORE THE DATE THE APPEAL IS FINALLY HEARD FOR DISPOSAL. 3. GROUNDS IN CROSS OBJECTION NO.21/AGR/2008 :- 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CAS E AND IN LAW THE LD. AUTHORITIES BELOW HAVE ERRED IN INITIATING PROC EEDINGS U/S 147 OF THE INCOME TAX ACT 1961 AND UPHOLDING THE SAME. 3 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. AUTHORITIES BELOW HAVE ERRED IN COMPLETING THE ASSESSMENT U/S 144 OF THE INCOME TAX ACT 1961 AND NOT DECIDING THE IS SUE RAISED. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. AUTHORITIES BELOW HAVE ERRED IN MAKING THE ADDI TION OF ` 10 50 010/- AND UPHOLDING THE ADDITION OF ` 4 00 000/- ON ACCOUNT OF DEPOSITS IN THE BANK ACCOUNT OF THE ASSESSEE. 4. THE RESPONDENT CRAVES LEAVE TO ADD/AMEND ANY GRO UND (S) BEFORE AND/OR AT THE TIME F HEARING. 4. THE FACTS RELATING TO THE ISSUE IN DISPUTE ARE T HAT THE ASSESSING OFFICER INITIATED THE PROCEEDINGS UNDER SECTION 147 OF THE INCOME TAX ACT 1961 (THE ACT HEREINAFTER) ON THE BASIS OF THE FINDING IN THE CAS E OF INDIVIDUAL SHRI SUBHASH KHUSHIRAMINI A MEMBER OF ASSESSEE AOP. DURING THE COURSE OF EXAMINING THE CASE OF SHRI SUBHASH KHUSHIRAMANI FOR THE ASSESSMEN T YEAR 2002-03 THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE WAS IND ULGED IN MAKING TRANSACTIONS IN THE NAME OF SO-CALLED AOP IN WHICH SHRI SUBHASH KH USHIRAMANI WAS ALSO ONE OF THE MEMBERS AND OPENED ACCOUNT NO.9286 IN THE PUNJA B & SINDH BANK JAYENDRA GANJ BRANCH GWALIOR AND DEPOSITED RS.10 50 010/- D URING THE ACCOUNTING PERIOD RELEVANT TO THE ASSESSMENT YEAR. THE ASSESSING OFF ICER ALSO HELD THAT SUMMON UNDER SECTION 131 OF THE ACT WAS ISSUED IN THE NAME OF SHRI SUBHASH KHUSHIRAMANI FOR THE ASSESSMENT YEAR 2002-03 IN THE CASE OF SO C ALLED AOP WHICH COULD NOT BE SERVED AS THE PARTIES WERE NOT AVAILABLE ON THE ADD RESSES SUPPLIED BY THE ASSESSEE. THUS A NOTICE UNDER SECTION 148 OF THE ACT WAS SER VED UPON SHRI SUBHASH 4 KHUSHIRAMANI ON 31.03.2006 BEING ONE OF THE MEMBERS OF THE AOP. THE ASSESSING OFFICER AFTER CONSIDERING THE DOCUMENTAR Y EVIDENCE AVAILABLE WITH HIM HELD THAT THE ASSESSEE HAS NOT SUBMITTED ANY DETAIL S REGARDING THE FORMATION OF AOP NAME OF MEMBERS OF AOP SHARES OF MEMBERS OF A OP ETC. THEREFORE THE ASSESSEE AOP HAS BEEN ASSESSED AT MAXIMUM MARGINAL RATE AND COMPLETED THE ASSESSMENT IN THE HANDS OF THE ASSESSEE ON PROTECTI VE BASIS AND SUBSTANTIAL ADDITION HAS BEEN MADE IN THE HANDS OF SHRI SUBHASH KHUSHIRA MANI ONE OF THE MEMBERS OF AOP. THE ASSESSING OFFICER ALSO HELD WHILE COMPLET ING THE ASSESSMENT IN DISPUTE ON 20.10.2006 UNDER SECTION 144 OF THE ACT THAT SHR I SUBHASH KHUSHIRAMANI IS ONE OF THE MEMBERS OF THE SO CALLED ASSESSEE AOP WHO CO ULD NOT GIVE THE DETAILS AND ADDRESSES OF OTHER MEMBERS AND ALSO COULD NOT EXPLA IN THE INVESTMENT IN DISPUTE. THEREFORE THE SAME IS DEEMED TO BE UNEXPLAINED INV ESTMENT UNDER SECTION 69 OF THE ACT AND ASSESSED AS INCOME FROM OTHER SOURCES. HE FURTHER HELD THAT THE ADDITION WAS MADE IN THE CASE OF THE INDIVIDUAL OF ONE OF THE MEMBERS OF SO CALLED AOP SHRI SUBHASH KHUSHIRAMANI IN THE ASSESSMENT YEA R 2002-03. BUT THE CIT(A) GWALIOR HAS DELETED THE SAID ADDITION VIDE ORDER DATED 11.08.2005 GIVEN IN THE INDIVIDUAL CASE OF SHRI SUBHASH KHUSHIRAMANI AG AINST WHICH APPEAL BEFORE THE ITAT AGRA HAS BEEN FILED BY THE DEPARTMENT AND WIT HOUT PREJUDICE TO ANY ACTION TO BE TAKEN IN THE INDIVIDUAL CASE OF AOP MEMBER SH RI SUBHASH KHUSHIRAMANI THE INVESTMENT APPEARING IN THE BANK ACCOUNT NO.9286 IN THE FINANCIAL YEAR RELEVANT TO 5 THE ASSESSMENT YEAR 2002-03 AMOUNTING TO RS.10 50 0 10/- IS ADDED IN THE TOTAL INCOME OF THE ASSESSEE AOP ON PROTECTIVE BASIS AT T HE RATE OF MARGINAL RATE. AGAINST THE ASSESSMENT ORDER DATED 20.10.2006 THE ASSESSEE FILED AN APPEAL BEFORE THE LD. FIRST APPELLATE AUTHORITY WHO VIDE T HE IMPUGNED ORDER DATED 30.05.2007 PARTLY ALLOWED THE APPEAL OF THE ASSESSE E BY CONFIRMING THE ACTION OF THE ASSESSING OFFICER UNDER SECTION 147 OF THE ACT AND RESTRICTING THE ADDITION TO THE EXTENT OF PEAK AMOUNT OF RS.4 00 000/- AFTER TE LESCOPING OF RS.1 00 000/- AS AVAILABLE FUND OF THE PREVIOUS YEAR. NOW THE REVE NUE HAS FILED THE PRESENT APPEAL AND THE ASSESSEE HAS FILED THE PRESENT CROSS OBJECT ION (C.O.) AGAINST THE IMPUGNED ORDER ON THE GROUNDS MENTIONED IN PARAGRAPH NOS.2 & 3 ABOVE. 5. AT THE TIME OF HEARING THE LD. D.R. RELIED UPON THE ORDER PASSED BY THE ASSESSING OFFICER AND ON THE CONTRARY THE LD. COU NSEL FOR THE ASSESSEE RELIED UPON THE ORDER PASSED BY THE LD. FIRST APPELLATE AUTHORI TY. THE LD. COUNSEL FOR THE ASSESSEE MADE A STATEMENT AT THE BAR THAT HE IS NOT PRESSING THE C.O. AND REQUESTED THAT THE APPEAL FILED BY THE REVENUE AND THE C.O. F ILED BY THE ASSESSEE MAY BE DISMISSED. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE R ELEVANT RECORDS AVAILABLE WITH US. THIS BENCH HAS DIRECTED MANY TIMES TO THE DEPARTMENT TO PRODUCE THE 6 RECORDS OF THE ASSESSEE BUT LASTLY THEY PRODUCED T HE SAME ON 15.03.2011 THROUGH SHRI N.K. UMEDKER ITO WARD 1(1) GWALIOR AND WE HA VE PERUSED THE SAME. WE HAVE ALSO PERUSED THE APPEALS FILED BY SHRI SUBHASH KHUSHIRAMANI FOR THE ASSESSMENT YEARS 1999-2000 2000-01 2001-02 & 2002 -03 IN WHICH THIS BENCH HAS DELETED THE ADDITION MADE IN THE CASE OF MEMBER OF AOP SHRI SUBHASH KHUSHIRAMANI. WE ARE OF THE CONSIDERED OPINION THA T IT IS AN ADMITTED FACT THAT THE LD. FIRST APPELLATE AUTHORITY HAS CONFIRMED THE INI TIATION OF PROCEEDINGS UNDER SECTION 147 OF THE ACT IN THE CASE OF THE ASSESSEE AND THE LD. COUNSEL FOR THE ASSESSEE HAS CHALLENGED THE SAME BY FILING THE C.O. IN THE PRESENT APPEAL OF THE DEPARTMENT BUT THE SAME IS BARRED BY 117 DAYS AND HE DID NOT PRESS HIS C.O. THEREFORE ON THE ISSUE OF INITIATING PROCEEDINGS U NDER SECTION 147 OF THE ACT IN THE CASE OF THE ASSESSEE IS CONFIRMED BUT AS REGARDS TO THE DELETION OF ADDITION OF RS.6 50 010/- MADE BY THE ASSESSING OFFICER UNDER S ECTION 69 OF THE ACT BY GIVING RELIEF TO THE ASSESSEE OF RS.1 00 000/- BY TELESCOP ING THE SAME ON THE BASIS OF AVAILABILITY OF THIS AMOUNT FOR THE PRECEDING YEARS WE HAVE ALSO PERUSED THE ORDER DATED 13.08.2009 PASSED BY THIS BENCH IN ITA NOS.33 5 336 337/AGR.2007 & 425/AGR./2005 FOR ASSESSMENT YEARS 1999-2000 2000- 01 2001-02 & 2002-03 RESPECTIVELY IN THE CASE OF INCOME-TAX OFFICER 1(1) /ACIT RANGE-1 GWALIOR VS. SHRI SUBHASH KHUSIRAMANI GWALIOR AND C.O. NOS. 03 04 05 & 07/AGR./2009 IN THE CASE OF SHRI SUBHASH KHUSIRAMANI GWALIOR VS. INCOME-TAX OFFICER 1(1) 7 GWALIOR FOR THE ASSESSMENT YEARS 1999-2000 2000-01 2001-02 & 2002-03 RESPECTIVELY. IN THE SAID CASES THIS BENCH HAS DI SMISSED THE APPEAL FILED BY THE REVENUE AS WELL AS THE C.O. OF THE ASSESSEE CONFIRM ING THE ORDER OF THE CIT(A) DATED 11.08.2005 FOR THE ASSESSMENT YEAR 2002-03 IN THE CASE OF MEMBER OF AOP SHRI SUBHASH KHUSIRAMANI. THE ASSESSING OFFICER WH ILE COMPLETING THE ASSESSMENT IN THE CASE OF PRESENT ASSESSEE I.E. THE AOP ON 20.10.2006 UNDER SECTION 144 OF THE ACT HIMSELF OBSERVED THAT IDENTI CAL ADDITION WAS MADE IN THE CASE OF INDIVIDUAL OF ONE OF THE MEMBERS OF THE SO CALLED AOP SHRI SUBHASH KUSHIRAMANI IN THE ASSESSMENT YEAR 2002-03 BUT THE CIT(A) HAS DELETED THE SAME VIDE ORDER DATED 11.08.2005 AGAINST WHICH THE APPEA L HAS BEEN FILED BEFORE THE ITAT AGRA. HENCE WITHOUT PREJUDICE TO ANY ACTION TO BE TAKEN IN THE INDIVIDUAL CASE OF AOP MEMBER SHRI SUBHASH KHUSHIRAMANI THE I NVESTMENT APPEARING IN BANK ACCOUNT NO.9286 IN THE FINANCIAL YEAR RELEVANT TO ASSESSMENT YEAR 2002-03 AMOUNTING TO RS.10 50 010 WAS ADDED IN THE TOTAL IN COME OF THE ASSESSEE AOP ON PROTECTIVE BASIS. THE SAID OBSERVATION THE ASSESS ING OFFICER HAS GIVEN IN THE LAST PAGE OF HIS ASSESSMENT ORDER. FOR THE SAKE OF CONV ENIENCE THE SAME IS REPRODUCED AS UNDER :- SHRI SUBHASH KHUSHIRAMANI IS ONE OF THE MEMBERS OF SO CALLED OF ASSESSEE AOP WHO COULD NOT GIVE THE DETAILS OF A DDRESSES OF OTHER MEMBERS. HE WAS ALSO UNDER OBLIGATION TO EXPLAIN A LL THE ENTRIES OF THE INVESTMENT BUT FAILED TO DO SO INSPITE OF SUFF ICIENT OPPORTUNITIES 8 ALLOWED. ` 10 50 010/- IS THEREFORE DEEMED TO BE UNEXPLAINED INVESTMENT U/S 69 OF THE IT ACT 1961 & ASSESSED AS INCOME FROM OTHER SOURCES. IDENTICAL ADDITION WAS MADE IN THE CASE O F INDIVIDUAL OF ONE OF THE MEMBERS OF THE SO CALLED AOP SHRI SUBHASH KH USHIRAMANI IN THE ASSESSMENT YEAR 2002-03 BUT THE HONORABLE COMMI SSIONER OF INCOME TAX (APPEAL) GWALIOR HAS DELETED THE SAID AD DITION FOR THE REASONS MENTIONED ON PAGE 37 OF HIS APPEAL ORDER IN APPEAL NUMBER CIT(A)-II/BPL(GWL)/IT/116/2005-06 DATED 11-08-2005 GIVEN IN THE INDIVIDUAL CASE OF SHRI SUBHASH KHUSHIRAMANI AGAINS T WHICH APPEAL BEFORE ITAT AGRA HAS BEEN FILED BY THE DEPARTMENT. HENCE IN VIEW OF ABOVE FACTS WITHOUT PREJUDICE TO ANY ACTION TO BE TAKEN IN THE INDIVIDUAL CASE OF AOP MEMBER SHRI SUBHASH KHUSHIRA MANI THE INVESTMENT APPEARING IN BANK ACCOUNT NUMBER 9286 IN THE FINANCIAL YEAR RELEVANT TO ASSESSMENT EAR 2002-03 ` 10 50 010/- IS ADDED IN THE TOTAL INCOME OF THE ASSESSEE AOP ON PROTECTIVE BASI S. PENALTY PROCEEDINGS U/S 271(1)(C) ARE INITIATED FOR THIS AD DITION SEPARATELY. INSPITE OF SPECIFIC REQUISITION ASSESSEE COULD NOT FILE THE BY-LAWS OF AOP. THE DATE OF AOPS FORMATION ITS PURPOSE & OTHER DETAILS INCLUDING DETERMINATION OF SHARES OF MEMBERS OF AOP AS MENTIONED IN ANNEXURE 1 OF THIS ORDER. HENCE FROM THE PAPERS ON RECORD IT IS OBVIOUS THAT SHARES OF MEMBERS OF AOPS ARE INDETER MINATE OR UNKNOWN. HENCE TAX ON ASSESSEE AOP HAS TO BE CHARG ED AT THE RATE OF MAXIMUM MARGINAL RATE. 7. IN THE APPEAL FILED BY THE ASSESSEE AGAINST THE ASSESSMENT IN DISPUTE THE LD. LD. FIRST APPELLATE AUTHORITY OBSERVED AS UNDER :- I HAVE GONE THROUGH THE SUBMISSION ASSESSMENT ORD ER ARGUMENTS AND FIND THAT THE ASSESSING OFFICER HAS R IGHTLY INVOKED THE PROVISIONS OF SEC 147 BASED ON FINDING IN ANOTHER C ASE OF SHRI SUBHASH KHUSHIRAMANI BECAUSE THE FINDING GIVEN IN T HAT CASE HAVE DIRECT NEXUS WITH THE CASE OF THE APPELLANT. THE F ACTS OF THE CASE OF THE APPELLANT AOP HAVE BEEN DISCUSSED IN THE CASE OF SH RI SUBHASH KHUSHIRAMANI WHO IS ONE OF THE MEMBER OF AOP. THER EFORE THE PROCEEDINGS INITIATED U/S 147 OF THE ACT IS HEREBY CONFIRMED. THE LD. 9 A.R. OF THE APPELLANT SUBMITTED THE COPY OF DEED OF AOP. BUT SINCE IT WAS NOT SUBMITTED DURING ASSESSMENT PROCEEDINGS HE NCE IT IS AN ADDITIONAL EVIDENCE AND CANNOT BE ENTERTAINED AT AP PEAL STAGE. SO FAR THE ADDITION OF ` 10 50 010/- IS CONCERNED I HAVE GONE THROUGH THE REASONS RECORDED AND WORKING OF ` 10 50 010/- AS GIVEN AT PAGE 2 OF THE ASSESSMENT ORDER AND FIND THAT THE REASONS R ECORDED ARE PRIMA FACIE FOR ` 10 50 000/- IS NOT A BAR TO MAKE ADDITION MORE THAN THIS AMOUNT. BUT AS PER WORKING GIVEN AT PAGE 2 OF THE ASSESSMENT ORDER THE MAXIMUM AMOUNT DEPOSITED WAS ` 5 00 000/- ON ONE DAY AND THE APPELLANT WAS HAVING THE FUNDS OUT OF ADDITION OF ` 1 00 000/- SUSTAINED DURING PRECEDING YEAR. THOUGH THE RETURN OF INCOME WAS NOT FILED BECAUSE THE TOTAL INCOME OF EACH PRECEDIN G YEARS WAS LESS THAN THE MINIMUM LIABLE TO INCOME TAX CONSIDERING THE FACT OF AVAILABILITY OF FUND OUT OF ADDITION ` 1 00 000/- SUSTAINED DURING PRECEDING YEAR THE FURTHER ADDITION OF ` 4 00 000/- ( ` 5 00 000/- - ` 1 00 000/- ADDITION SUSTAINED DURING THE PRECEDING YEAR) INCOME GENERATED AND CONTRIBUTION MADE BY THE MEMBERS OF T HE APPELLANT AOP IT WOULD BE REASONABLE TO RESTRICT THE ADDITIO N TO THE EXTENT OF PEAK AMOUNT ` 4 00 000/- AFTER TELESCOPING OF ` 1 00 000/- OF ADDITION SUSTAINED DURING PRECEDING YEAR. 8. AFTER GOING THROUGH THE OBSERVATIONS OF THE ASSE SSING OFFICER IN THE IMPUGNED ASSESSMENT ORDER AS WELL AS THE FINDING GI VEN BY THE LD. FIRST APPELLATE AUTHORITY IN DELETING THE ADDITION IN DISPUTE ALONG WITH THE ORDER DATED 13.08.2009 PASSED BY THIS BENCH IN THE CASE OF SHRI SUBHASH KH USHIRAMANI MEMBER OF AOP WE ARE OF THE CONSIDERED OPINION THAT THE LD. FIRST APPELLATE AUTHORITY HAS PASSED A WELL REASONED ORDER WHILE DELETING THE ADDITION IN DISPUTE. THUS WE UPHOLD THE SAME BY DISMISSING THE APPEAL FILED BY THE REVENUE AS WELL AS THE CROSS OBJECTION FILED BY THE ASSESSEE. 10 9. IN THE RESULT APPEAL FILED BY THE REVENUE AND T HE CROSS OBJECTION FILED BY THE ASSESSEE ARE DISMISSED. (ORDER PRONOUNCED IN THE OPEN COURT ON 31.03.201 1). SD/- SD/- (P.K. BANSAL) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER PLACE: AGRA DATE: 31 ST MARCH 2011 PBN/* COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT BY ORDER 3. CIT CONCERNED 4. CIT (APPEALS) CONCERNED 5. DR ITAT AGRA BENCH AGRA 6. GUARD FILE ASSISTANT REGISTRAR INCOME-TAX APPELLATE TRI BUNAL AGRA TRUE COPY