DY C.I.T., CIRCLE-13(2), MUMBAI v. M/S. MARYAN FORWARDING CORPORATION, MUMBAI

ITA 1383/MUM/2009 | 2003-2004
Pronouncement Date: 22-02-2010 | Result: Allowed

Appeal Details

RSA Number 138319914 RSA 2009
Assessee PAN AAAFM1352M
Bench Mumbai
Appeal Number ITA 1383/MUM/2009
Duration Of Justice 11 month(s) 22 day(s)
Appellant DY C.I.T., CIRCLE-13(2), MUMBAI
Respondent M/S. MARYAN FORWARDING CORPORATION, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 22-02-2010
Appeal Filed By Department
Order Result Allowed
Bench Allotted B
Tribunal Order Date 22-02-2010
Assessment Year 2003-2004
Appeal Filed On 02-03-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES B MUMBAI BEFORE SHRI R.S.SYAL AM AND SHRI R.S.PADVEKAR JM ITA NO.1383/MUM/2009 : ASST.YEAR 2003-2004 THE DY.COMMISSIONER OF INCOME - TAX CIRCLE 13(2) MUMBAI. VS. M/S.MARYAN FORWARDING CORPORATION 130 VYPAR BHAVAN 1 ST FLOOR P.D.MELLO ROAD CARNAC BUNDER MUMBAI 400 009. PA NO.AAAFM1352M. (APPELLANT) (RESPONDENT) APPELLANT BY : S/SHRI T.T.JACOB & SATISHCHANDRA RESPONDENT BY : S/SHRI VIJAY MEHTA & NILESH MEHTA O R D E R PER : R.S.SYAL AM : THIS APPEAL BY THE REVENUE ARISES OUT OF THE ORDER PASSED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) ON 16.12.2008 IN RELATION TO THE ASSESSMENT YEAR 2003-2004. 2. THE REVENUE IS AGGRIEVED AGAINST REDUCTION IN TH E ESTIMATE OF INCOME MADE BY THE A.O. FROM RS. 25 LACS TO RS. 10 LACS BY THE LEARNED CIT(A) WITHOUT CALLING FOR THE REMAND REPORT FROM THE ASSESSING OFFICER TO VERIFY THE CORRECTNESS OF THE PAPER BOOK SUBMITTED BEFORE THE LEARNED CIT(A) FOR THE FIRST TIME. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT THE ASSESSEE FILED R ETURN DECLARING LOSS OF RS.27 61 505. IT CONTINUED THE BUSINESS OF TRANSPO RTATION. THE ASSESSEE HAD SHOWN TOTAL RECEIPT AT RS.4.06 INCLUDING PROFIT ON SALE OF ASSET AT RS.3.42 LAKHS . AFTER DEBITING THE EXPENSES LIKE TRANSPORTATION ETC . LOSS ON SALE OF ASSET THE NET LOSS WAS DECLARED AT RS.27.61 LAKHS. THE A.O. NOTED THAT IN THE IMMEDIATELY PRECEDING YEAR THE ASSESSEES RECEIPTS WERE AT RS.6 .31 CRORE AND AFTER DEBITING ALL THE EXPENSES THE NET PROFIT WAS DECLARED AT RS.38.1 4 LAKHS. SEVERAL NOTICES WERE ISSUED BY THE AO CALLING UPON THE ASSESSEE TO FURN ISH THE INFORMATION ENABLING THE ITA NO.1383/MUM/2009 M/S.MARYAN FOWARDING CORPORATION. 2 COMPLETION OF THE ASSESSMENT. THERE IS A MENTION O F SERIES OF LETTERS ISSUED BY THE ASSESSING OFFICER IMPRESSING UPON THE ASSESSEE TO A TTEND THE PROCEEDINGS AND FOR FURNISHING THE REQUISITE DETAILS. THERE WAS NO APPE ARANCE FROM THE SIDE OF THE ASSESSEE. IN SUCH CIRCUMSTANCES THE A.O. LEFT WITH NO OPTION PROCEEDED TO FRAME THE ASSESSMENT U/S.144 OF THE ACT. THERE WAS CERTA IN UNSECURED LOANS OF RS.7.65 CRORE AND IN THE ABSENCE OF ANY LOAN CONFIRMATIONS THE A.O. HELD THE SAME COULD NOT BE VERIFIED. SIMILARLY HUGE ADMINISTRATIVE EXPE NSES AMOUNTING TO RS.2.23 CRORE WERE CLAIMED AS DEDUCTION. IN THE ABSENCE OF THE BI LLS OF SUCH ADMINISTRATIVE AND OTHER EXPENSES THE A.O. COULD NOT VERIFY THE GENUI NENESS OF THESE EXPENSES. UNDER THESE CIRCUMSTANCES HE IGNORED THE LOSS AND ESTIMAT ED THE INCOME AT RS.25 LAKHS. THE LEARNED CIT(A) UPHELD THE ACTION OF THE A.O. IN FINALIZING THE ASSESSMENT U/S.144 FOR THE REASON THAT THE A.O. ALLOWED SUFFIC IENT OPPORTUNITY TO THE ASSESSEE. DURING THE COURSE OF THE FIRST APPELLATE PROCEEDING S THE ASSESSEE FURNISHED VARIOUS DETAILS IN SUPPORT OF ITS CLAIM AND ALSO OFFERED TO BE TAXED AT INCOME OF RS. 10.00 LACS. THE LEARNED CIT(A) ACCEPTED THE ASSESSEES P ROPOSAL AND REDUCED THE ESTIMATE OF INCOME TO RS.10 LAKHS AGAINST WHICH TH E REVENUE HAS COME UP IN APPEAL BEFORE US. 3. AFTER CONSIDERING THE RIVAL SUBMISSIONS AND PERU SING THE RELEVANT MATERIAL ON RECORD IT IS OBSERVED THAT IN THE IMMEDIATELY PREC EDING YEAR THE ASSESSEES RECEIPTS WERE AT RS.6.31 CRORE AND THE NET PROFIT WAS SHOWN AT RS.38.14 LAKHS. AS AGAINST THAT THE TRANSPORTATION RECEIPTS IN THE INSTANT Y EAR AMOUNTED TO RS.3.95 CRORE APART FROM PROFIT ON SALE OF ASSET AT RS.3.42 LAKHS . DESPITE THESE FACTS THE ASSESSEE CLAIMED LOSS OF RS.27.61 LAKHS. IT IS SETTLED LEGAL POSITION THAT THE ONUS IS ALWAYS ON THE ASSESSEE TO PROVE THE GENUINENESS OF ITS CLAIM. IT IS ONLY WHEN THE INITIAL BURDEN IS DISCHARGED THAT THE ONUS SHIFTS UPON THE ASSESS ING OFFICER TO REBUT THE SAME IF HE IS NOT CONVINCED WITH THE ASSESSEES EXPLANATION /EVIDENCE. HERE IS A CASE IN WHICH THE ASSESSEE DID NOT PARTICIPATE IN THE ASSES SMENT PROCEEDINGS DESPITE ITA NO.1383/MUM/2009 M/S.MARYAN FOWARDING CORPORATION. 3 SEVERAL NOTICES ISSUED BY THE A.O. AS SUCH THE A.O. WAS LEFT WITH NO OPTION BUT TO ESTIMATE THE INCOME WHICH WAS DETERMINED BY HIM AT RS.25 LAKHS BY CONSIDERING INTER ALIA THE GROSS RECEIPTS AND PROFITS OF THE EARLIER YEAR VIS--VIS THIS YEAR. DURING THE FIRST APPELLATE PROCEEDINGS THE ASSESSEE FURNISHED CERTAIN DETAILS AND THE LEARNED CIT(A) WITHOUT CALLING FOR REMAND REPORT F ROM THE ASSESSING OFFICER ADJUDICATED UPON THE MATTER AND REDUCED THE ADDITIO N TO RS.10 LAKHS AND THAT TOO WITHOUT ANY BASIS. IN OUR CONSIDERED OPINION THE LE ARNED CIT(A) WAS NOT JUSTIFIED IN ARBITRARILY REDUCING THE ADDITION SOLELY ON THE BASIS OF THE ASSESSEES ASSURANCE OF NOT FILING THE APPEAL ON THE ESTIMATED INCOME OF RS. 10.00 LACS. SINCE THE ASSESSEE FAILED TO FURNISH ANY INFORMATION/DETAIL WORTH THE NAME BEFORE THE AO AND IF THE INFORMATION FILED DURING THE COURSE OF THE FIRST APPELLATE PROCEEDINGS WAS CONVINCING THE LD. CIT(A) OUGHT TO HAVE CALLED FOR THE REMAND REPORT FROM THE A.O. WHICH HE FAILED TO DO. AS THE INSTANT ASSESSM ENT WAS COMPLETED U/S.144 IN OUR CONSIDERED OPINION IT WILL BE JUST AND FAIR IF THE IMPUGNED ORDER IS SET ASIDE AND THE MATTER IS RESTORED TO THE FILE OF A.O. WE O RDER ACCORDINGLY AND DIRECT HIM TO MAKE THE ASSESSMENT DE NOVO AFTER ALLOWING A REASONABLE OPPORTUNITY OF BEING HEARD TO THE RESPONDENT. THE ASSESSEE IS ALSO DIREC TED TO PRODUCE WHATEVER INFORMATION IS REQUIRED BY THE A.O. FOR ENABLING HIM TO COMPLETE THE ASSESSMENT. 4. IN THE RESULT THE APPEAL IS ALLOWED FOR STATIST ICAL PURPOSES. ORDER PRONOUNCED ON THIS 22 ND DAY OF FEBRUARY 2010. SD/- SD/- ( R.S.PADVEKAR ) ( R.S.SYAL ) JUDICIAL MEMBER ACCOUNTANT ME MBER MUMBAI : 22 ND FEBRUARY 2010. DEVDAS* ITA NO.1383/MUM/2009 M/S.MARYAN FOWARDING CORPORATION. 4 COPY TO : 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT CONCERNED 4. THE CIT(A) XIII MUMBAI. 5. THE DR/ITAT MUMBAI. 6. GUARD FILE. TRUE COPY. BY ORDER ASSISTANT REGISTRAR ITAT MUMBAI.