M/s Sai Builders, Bhind v. C.I.T, Gwalior

ITA 116/AGR/2013 | 2008-2009
Pronouncement Date: 19-07-2013 | Result: Dismissed

Appeal Details

RSA Number 11620314 RSA 2013
Assessee PAN ABHFS1834Q
Bench Agra
Appeal Number ITA 116/AGR/2013
Duration Of Justice 3 month(s)
Appellant M/s Sai Builders, Bhind
Respondent C.I.T, Gwalior
Appeal Type Income Tax Appeal
Pronouncement Date 19-07-2013
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted DB
Tribunal Order Date 19-07-2013
Date Of Final Hearing 10-07-2013
Next Hearing Date 10-07-2013
Assessment Year 2008-2009
Appeal Filed On 18-04-2013
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH AGRA BEFORE : SHRI BHAVNESH SAINI JUDICIAL MEMBER AND SHRI A.L. GEHLOT ACCOUNTANT MEMBER ITA NO. 116/AGRA/2013 ASSTT. YEAR : 2008-09 M/S. SAI BUILDERS VS. COMMISSIONER OF 11 BANGLA BAZAAR BHIND (MP). INCOME-TAX GWALI OR. (PAN: ABHFS 1834 Q) (APPELLANT) (RESPONDENT) APPELLANT BY : NONE RESPONDENT BY : SHRI K.K. MISHRA JR. D.R. DATE OF HEARING : 10.07.2013 DATE OF PRONOUNCEMENT OF ORDER : 19 07.2013 ORDER PER BHAVNESH SAINI J.M.: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF LD. CIT GWALIOR U/S. 263 OF THE IT ACT DATED 12.03.2013 FOR THE ASS ESSMENT YEAR 2008-09. 2. NONE PRESENT ON BEHALF OF THE ASSESSEE DESPITE S ERVICE OF NOTICE. THE ASSESSEES COUNSEL INTIMATED BY FAX THAT THE APPEAL OF THE ASSESSEE MAY BE CONSIDERED ON THE BASIS OF WRITTEN SUBMISSIONS ALRE ADY FILED ON RECORD. THE LD. DR RELIED UPON THE IMPUGNED ORDER. ITA NO. 116/AGRA/2013 2 3. BRIEFLY THE FACTS OF THE CASE ARE THAT IN THIS CASE THE RETURN OF INCOME WAS FILED BY THE ASSESSEE FIRM ON INCOME OF RS.1 51 870 /-. THE ASSESSMENT U/S. 143(3) WAS COMPLETED ON 24.12.2010 AND INCOME OF THE ASSES SEE WAS DETERMINED AT RS.8 53 880/-. THE LD. CIT WHILE EXAMINING THE ASSE SSMENT RECORD NOTICED FROM THE LIABILITY SIDE OF THE BALANCE SHEET THAT UNSECU RED LOAN TO THE TUNE OF RS.3 89 000/- HAVE BEEN RECEIVED BY THE ASSESSEE DU RING THE YEAR UNDER CONSIDERATION. ON PERUSAL OF THE DETAILS CONFIRMAT ION LETTERS/CERTIFICATES AVAILABLE ON RECORD IT WAS OBSERVED THAT ALL THESE LENDERS H AVE ADVANCED LOAN BELOW RS.20 000/- EACH AND NO COMPLETE DETAILS WITH REGAR D TO THESE LOANS HAVE BEEN BROUGHT ON RECORD DURING THE COURSE OF ASSESSMENT P ROCEEDINGS. THE PERUSAL OF THE CONFIRMATION LETTERS/CERTIFICATES GOES TO REVEAL TH AT THE CONFIRMATION/CERTIFICATES APPEAR TO HAVE BEEN SIGNED BY A SINGLE PERSON. THUS GENUINENESS OF THEIR CONFIRMATIONS APPEARS DOUBTFUL. APART FROM THE ABOV E THE IDENTITY OF THE CREDITORS/LENDERS THEIR CREDITWORTHINESS WAS ALSO NOT PROVED AND VERIFIED BY THE AO. ON FURTHER PERUSAL OF THE DEPRECIATION CHART I T WAS NOTICED THAT THE ASSESSEE HAS PURCHASED VARIOUS ASSETS AND CLAIMED DEPRECIATI ON HOWEVER NO CORROBORATING BILLS SHOWING PURCHASE OF THESE ASSETS IS BROUGHT O N RECORD EXCEPT BILLS IN RESPECT OF L & T LOADER AND VIBRATORY ROLLER. THE AO HAS NO T VERIFIED THE BILLS WITH REGARD TO PURCHASE OF ASSETS WHILE ALLOWING DEPRECI ATION. SHOW CAUSE NOTICE U/S. 263 WAS ISSUED AND THE ASSESSEE INITIALLY SOUGHT AD JOURNMENTS AND LASTLY ON 08.03.2013 WRITTEN SUBMISSION WAS FILED COPY OF W HICH IS FILED IN THE PAPER BOOK. ITA NO. 116/AGRA/2013 3 ACCORDING TO THE LD. CIT HOWEVER NO DESIRED DOCUM ENTARY EVIDENCES IN RESPECT OF CREDITWORTHINESS OF THE LENDERS AND GENUINENESS OF THE TRANSACTION WERE PRODUCED FOR VERIFICATION. NO EVIDENCE OF PURCHASE OF ASSETS HAVE BEEN PRODUCED FOR VERIFICATION. THEREFORE IN THE ABSENCE OF CREDIBLE AND RELEVANT DOCUMENTS AND ADEQUATE ENQUIRIES NOT CARRIED OUT BY THE AO ON BOT H THESE ISSUES THE LD. CIT WAS OF THE VIEW THAT THE ASSESSEE ORDER IS ERRONEOUS IN SO FAR AS PREJUDICIAL TO THE INTERESTS OF REVENUE. THEREFORE THE SAME WAS SET A SIDE ON THESE TWO POINTS AND THE AO WAS DIRECTED TO CONSIDER BOTH THE ISSUES AFTER M AKING APPROPRIATE ENQUIRY AS PER LAW BY PROVIDING OPPORTUNITY TO THE ASSESSEE OF BEING HEARD. 4. THE ASSESSEE IN THE WRITTEN SUBMISSIONS BRIEFLY EXPLAINED THAT THE CONFIRMATIONS OF ALL THE CASH CREDITS WERE FURNISHE D BEFORE THE AO WHICH HAVE BEEN EXAMINED BY THE AO AND FURTHER THE SIGNATURE B Y ONE PERSON WAS EXPLAINED AND ALL CONFIRMATIONS WERE FILED BEFORE THE LD. CIT . AS REGARDS THE DEPRECIATION IT WAS SUBMITTED THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE AO HAS LOOKED INTO ALL THE BILLS AND VOUCHERS AND BOOKS OF ACCOUNT AND HE WAS SATISFIED WITH THE EXPLANATION OF THE ASSESSEE. THEREFORE TH ERE IS NO RULE THAT THE COPIES OF THESE BILLS SHOULD BE PLACED ON RECORD. IT WAS SUBM ITTED THAT MERELY BECAUSE ADEQUATE ENQUIRIES HAVE NOT BEEN CARRIED IS NO GROU ND TO CONSIDER THE ASSESSMENT ORDER TO BE ERRONEOUS AND CERTAIN DECISIONS IN RESP ECT OF THE SAME PROPOSITION HAVE BEEN RELIED UPON. ON THE OTHER HAND THE LD. DR REL IED UPON THE IMPUGNED ORDER. ITA NO. 116/AGRA/2013 4 5. WE HAVE CONSIDERED THE SUBMISSIONS OF PARTIES AN D PERUSED THE MATERIAL AVAILABLE ON RECORD AND DO NOT FIND ANY JUSTIFICATI ON TO INTERFERE WITH THE ORDER OF THE LD. CIT IN SETTING ASIDE THE ASSESSMENT ORDERS ON TWO POINTS U/S. 263 OF THE IT ACT. THE COPY OF ASSESSMENT ORDER IS FILED ON RECOR D IN WHICH THE AO DID NOT DISCUSS ANYTHING ABOUT THESE TWO ISSUES. EVEN THERE IS NO WHISPER FROM THE SIDE OF THE AO WHETHER HE HAS EXAMINED AT ALL THESE ISSUES WHILE FRAMING THE REGULAR ASSESSMENT. NO COPY OF THE ORDER SHEET OR REPLY FIL ED BEFORE THE AO ARE FILED IN THE PAPER BOOK. IN ABSENCE OF ANY PROOF IN THE ASSESSME NT ORDER AND MATERIAL AVAILABLE ON RECORD IT IS DIFFICULT TO BELIEVE THAT THE AO H AS MADE ANY ENQUIRY ON BOTH THESE POINTS AT THE ASSESSMENT STAGE. THE ASSESSEE IN THE PAPER BOOK HAS FILED REPLY FILED BEFORE THE LD. CIT(A) IN WHICH THE ASSESSEE HAS FI LED ONLY THE CONFIRMATIONS OF THE CASH CREDITORS AND IN SOME CASES PROOF OF AGRICULTU RE LAND HOLDING BANK ACCOUNT/BANK PASSBOOK. THE SAME THEREFORE WOULD N OT PROVE CREDITWORTHINESS OF THE CREDITORS AND THE GENUINENESS OF THE TRANSACTIO N IN THE MATTER. IT IS WELL SETTLED LAW THAT BURDEN IS UPON THE ASSESSEE U/S. 68 OF THE IT ACT TO PROVE IDENTITY OF THE CREDITORS THEIR CREDITWORTHINESS AND GENUINENESS O F THE TRANSACTION IN THE MATTER. MERE FILING OF THE CONFIRMATION WITH PROOF OF IDENT ITY WOULD NOT PROVE THE CREDITWORTHINESS OF THE CREDITORS AND GENUINENESS O F THE TRANSACTION. MERELY BECAUSE CREDITS HAVE BEEN GIVEN THROUGH BANK ACCOUN T IS ALSO NOT SACROSANCT TO PROVE CREDITWORTHINESS OF THE CREDITORS AND GENUINE NESS OF THE TRANSACTION. THE LD. ITA NO. 116/AGRA/2013 5 CIT WHILE EXAMINING THE ASSESSMENT RECORD SPECIFICA LLY FOUND THAT THERE ARE ONLY CONFIRMATION LETTERS / CERTIFICATES FILED ON RECORD AND THE SAME APPEARS TO BE SIGNED BY THE SINGLE PERSON. NO EVIDENCE OF THEIR CREDITWO RTHINESS AND GENUINENESS OF THE TRANSACTION WERE FILED BEFORE THE AO. EVEN AFTER GI VING OPPORTUNITY IN THE PROCEEDINGS U/S. 263 OF THE IT ACT THE ASSESSEE DI D NOT PRODUCE ANY EVIDENCE TO PROVE THE CREDITWORTHINESS OF THE CREDITORS AND GEN UINENESS OF THE TRANSACTION IN THE MATTER. FURTHER NO EVIDENCES WERE PRODUCED BEF ORE THE AO AND CIT TO PROVE THAT ASSETS HAVE BEEN PURCHASED BY THE ASSESSEE. TH E ASSESSEE IN THE WRITTEN SUBMISSION STATED THAT IT IS NOT PRESCRIBED UNDER T HE IT ACT OR RULES THAT THE COPY OF PURCHASE BILLS OF ASSETS SHOULD BE PRODUCED ON R ECORD. REPLY OF ASSESSEE CLEARLY SUPPORTS THE FINDING OF THE LD. CIT THAT THE ASSESS EE HAD NO EVIDENCE TO PROVE THE PURCHASE OF ASSETS ON WHICH DEPRECIATION HAS BEEN C LAIMED. FOR CLAIMING DEPRECIATION THE ASSESSEE SHALL HAVE TO PROVE ESSE NTIALLY THAT THE ASSESSEE OWNED THE ASSETS WHICH HAVE BEEN USED FOR THE PURPOSE OF BUSINESS. WHEN THE SPECIFIC OBJECTION WAS TAKEN IN THE PROCEEDINGS U/S. 263 IT WAS THE DUTY OF THE ASSESSEE TO HAVE PRODUCED EVIDENCES OF PURCHASE OF ASSET AT LEA ST BEFORE THE LD. CIT BUT HE DID NOT DO SO. THEREFORE THERE IS NOTHING WRONG IN THE FINDING OF THE LD. CIT. AS NOTED ABOVE THERE IS NO FINDING OR WHISPER IN THE ASSESS MENT ORDER IF THE AO EXAMINED BOTH THE ISSUES AT ASSESSMENT STAGE. THEREFORE THE ASSESSMENT ORDER WAS RIGHTLY HELD TO BE ERRONEOUS IN SO FAR AS PREJUDICIAL TO TH E INTEREST OF REVENUE. IT IS WELL SETTLED LAW THAT THE FAILURE BY THE AO TO MAKE ENQU IRY IS ALSO ERRONEOUS AND ITA NO. 116/AGRA/2013 6 PREJUDICIAL TO THE INTEREST OF REVENUE. WE RELY UPO N THE DECISIONS IN THE CASE OF GEE VEE ENTERPRISES 99 ITR 375 (DEL.) TARGEN TEA CO. PVT. LTD. 205 ITR 45 (GAU.) AND K.A. RAMASWAMY CHETTIAR 220 ITR 657 (MAD.). CO NSIDERING THE ABOVE DISCUSSION WE DO NOT FIND ANY MERIT IN THE APPEAL OF THE ASSESSEE. IT APPEARS THAT THE LD. CIT NOTED IT TO BE A CASE WHERE NO ADEQUATE ENQUIRY HAS BEEN CARRIED OUT BY THE AO. IN FACT IT IS A CASE WHERE NO ENQUIRY HAS BEEN CONDUCTED BY THE AO ON BOTH THESE ISSUES. THEREFORE THE LD. CIT PROPERLY EXERCISED JURISDICTION U/S. 263 OF THE IT ACT TO SET ASIDE THE ASSESSMENT ORDER ON BOT H THESE POINTS. WE THEREFORE DO NOT FIND ANY MERIT IN THE APPEAL OF THE ASSESSEE. T HE SAME IS ACCORDINGLY DISMISSED. 6. IN THE RESULT THE APPEAL OF THE ASSESSEE IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (A.L. GEHLOT) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER *AKS/- COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A) CONCERNED BY ORDER 4. CIT CONCERNED 5. DR ITAT AGRA 6. GUARD FILE SR. PRIVATE SECRETARY TRUE COPY