ITO, New Delhi v. M/s. Sai Lubricants Pvt. Ltd, New Delhi

ITA 1906/DEL/2009 | 2006-2007
Pronouncement Date: 19-01-2010 | Result: Allowed

Appeal Details

RSA Number 190620114 RSA 2009
Assessee PAN AABCS5879D
Bench Delhi
Appeal Number ITA 1906/DEL/2009
Duration Of Justice 8 month(s) 11 day(s)
Appellant ITO, New Delhi
Respondent M/s. Sai Lubricants Pvt. Ltd, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 19-01-2010
Appeal Filed By Department
Order Result Allowed
Bench Allotted G
Tribunal Order Date 19-01-2010
Date Of Final Hearing 19-01-2010
Next Hearing Date 19-01-2010
Assessment Year 2006-2007
Appeal Filed On 08-05-2009
Judgment Text
ITA NO. 1906/DEL/09 A.Y. 2006-07 1 IN THE INCOMETAX APPELATE TRIBUNAL DELHI BENCH G: NEW DELHI BEFORE SHRI R.P. TOLANI JUDICIAL MEMBER & SHRI SHAMIM YAHYA ACCOUNTANT MEMBER ITA NO. 1906/DEL/2009 A.Y.: 2006-07 INCOME TAX OFFICER WARD7(2) VS. M/S SAI LUBRIC ANTS PVT. LTD. ROOM NO. 306 CR BUILDING H-25 SOUTH EXTENSI ON PART-II IP ESTATE NEW DELHI NEW DELHI [PAN: AABCS5879D] (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE DEPARTMENT BY : SHRI KISHORE B. SR. DR O R D E R PER SHAMIM YAHYA : AM THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST TH E ORDERS OF THE LD. CIT(A) DATED 4.3.2009 PERTAINING TO ASSESSM ENT YEAR 2006- 07. 2. THE ISSUES RAISED READ AS UNDER:- I) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE LD. CIT(A) ERRED IN LAW AND ON FACTS IN DELETING TH E ADDITION OF RS. 6 51 957/- MADE BY THE ASSESSING OFFICER TREATING NET PROFIT @10% OF GROSS SALES AND 100% OF OTHER INCOME. II) ON THE FACTS AND CIRCUMSTANCES OF THE CASE LD. CIT(A) ERRED IN LAW AND ON FACTS IN DELETIN G THE ITA NO. 1906/DEL/09 A.Y. 2006-07 2 ADDITION OF RS. 2 05 776/- MADE BY THE ASSESSING OFFICER IN RESPECT OF OTHER INCOME. III) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE LD. CIT(A) ERRED IN LAW AND ON FACTS IN DELETING T HE ADDITION OF RS. 6 08 314/- MADE BY THE ASSESSING OFFICER U/S 68 OF THE INCOME TAX ACT. 3. IN THIS CASE THE ASSESSMENT WAS FRAMED UNDER SEC TION 144 OF THE IT ACT. SINCE THERE WAS NO COMPLIANCE TO THE N OTICES ISSUED BY THE AO THE AO OPINED THAT IT WAS APPARENT THAT ASS ESSEE HAS NOTHING TO SAY ON THE MATTER AND THEY HAVE ACCEPTE D THAT THEIR BOOKS OF ACCOUNT SHOULD BE REJECTED. ACCORDINGLY HE PASSED THE ASSESSMENT ORDER AS UNDER:- (I) THE NET PROFIT IS BEING CALCULATED AT 10% OF THE GROSS SALES OF RS. 65 19 566/- PLUS 100% OF OTHER INCOME OF RS. 2 05 776/-. (II) IN VIEW OF THE ASSESSEE COMPANYS FAILURE TO P ROVE THE IDENTITY GENUINENESS AND CREDITWORTHINESS OF T HE GIVERS OF FRESH SECURED LOANS AMOUNTING TO RS. 6 08 314/- (RS. 20 55 667/- LESS RS. 14 47 353/-) THE SAME IS BEING ADDED BACK TO THE NET PROFIT IN VIEW OF THE PROVISIONS OF SECTION 68 OF THE INCOME TAX ACT 1961. 4. IT WAS SUBMITTED BEFORE THE LD. CIT(A) THAT TH AT THE ASSESSEE HAS SUBMITTED THE DETAILS IN THE SHAPE OF PAPER BOO K BEFORE THE ASSESSING AUTHORITY. THE COMPARATIVE CHART ON GP & NP RATIO FOR THE LAST 6 YEARS WAS ALSO NOTED BY THE LD. CIT(A). ON THE BASIS OF COMPARISON CHART LD. CIT(A) FOUND THAT THERE WAS NO ANOMALY IN THE ASSESSEES GP RATIO AND NP RATIO. LD. CIT(A) HELD THAT SINCE NO ITA NO. 1906/DEL/09 A.Y. 2006-07 3 SPECIFIC REASONING HAS BEEN GIVEN BY THE AO FOR MAK ING ADDITION AT 10% OF GROSS SALES AND TREATING THE SAME AS NET PRO FIT WITHOUT POINTING OUT ANY PARTICULAR EXPENSE THAT IS UNVOUCH ED/ EXCESSIVE THE ADDITION IS DELETED. SIMILARLY AO HAS GIVEN NO RE ASON FOR ADDING 100% OF OTHER INCOME OF RS. 2 05 776/-. IN THE AB SENCE OF ANY SPECIFIC REASON ADDITION OF 100% OF OTHER INCOME I S UNJUSTIFIED AND UNWARRANTED AND IS DELETED. THE ASSESSEE HAS FILED PHOTOCOPY OF BALANCE SHEET A S ON 31 ST MARCH 2006 WHICH SHOWS THAT SECURED LOANS AS ON 31 .3.06 WAS RS. 20 55 666.93 AND AS AT 31.3.2005 WAS RS. 14 47 353. 41. THE SCHEDULE C OF SECURED LOANS HAS ALREADY BEEN FI LED WHICH SHOWS THAT SECURED LOAN FROM CANARA BANK-CA-73334 AS ON 3 1.3.2006 WAS RS. 20 55 666.93 AND AS ON 31.3.2005 WAS RS. 14 47 355.41. THE ADDITION ON DIFFERENCE BETWEEN THE OPENING AND CLO SING BALANCE OF SECURED LOAN ESPECIALLY WHEN THE COPY OF BALANCE SH EET WAS AVAILABLE WHICH SHOWED THE CLOSING BALANCE AS ON 3 1 ST MARCH 2006 AND 31 ST MARCH 2005 (OPENING BALANCE ON 1.4.2005) WAS ARBI TRARY AND IS ALSO DELETED. 5. AGAINST THIS ORDER THE REVENUE IS IN APPEAL BEFO RE US. 6. WE HAVE HEARD LD. DR AND PERUSED THE RECORDS. NONE APPEARED ON BEHALF OF THE ASSESSEE. WE FIND THAT A SSESSEE HAS NOT CANVASSED HIS CASE BEFORE THE AO AS A RESULT OF WHI CH THE ASSESSMENT WAS FRAMED UNDER SECTION 144 OF THE IT A CT. BEFORE THE LD. CIT(A) ASSESSEE HAS SUBMITTED THAT HE HAS SUB MITTED CERTAIN DOCUMENTS AND INFORMATION BEFORE THE AO. OTHER DOC UMENTS PERTAINING TO COMPARATIVE CHART ETC. WAS ALSO PROD UCED BEFORE THE ITA NO. 1906/DEL/09 A.Y. 2006-07 4 CIT(A). UPON GOING THROUGH THESE THE LD. CIT(A) HA S GRANTED RELIEF TO THE ASSESSEE. IN THIS REGARD IT IS NOT MENTIONE D WHETHER THE CIT(A) HAS ASKED FOR REMAND REPORT FROM THE AO. HEN CE WE ARE FACING A SITUATION WHERE ASSESSEE HAD SUBMITTED NO DETAILS BEFORE THE AO BUT LD. CIT(A) HAS PLACED RELIANCE ON VARIOU S SUBMISSIONS AND DOCUMENTS BEFORE HIM. IN OUR CONSIDERED OPINI ON THE INTEREST OF JUSTICE WILL BE SERVED IF THE MATTER IS REMITT ED TO THE FILES OF AO TO EXAMINE THE AOS SUBMISSION AFRESH. ACCORDINGL Y THE ISSUES ARE REMITTED TO THE FILES OF AO TO CONSIDER THE SAM E AFRESH. NEEDLESS TO ADD THAT THE ASSESSEE SHOULD BE GIVEN ADEQUATE OPPORTUNITY OF BEING HEARD. 7. IN THE RESULT THE REVENUES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 19/01/2010 UPON CONCLUSION OF THE HEARING. SD/- SD/- [R.P. TOLANI) [SHAMIM YAHYA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 19 /01/ 2010 SRB COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR ITAT TRUE COPY BY ORDER DEPUTY REGISTRAR ITAT DELHI BENCHES