RAJESH KUMAR MACHIWAL, Jaipur v. ITO, Dausa

ITA 191/JPR/2011 | 2001-2002
Pronouncement Date: 25-11-2011 | Result: Partly Allowed

Appeal Details

RSA Number 19123114 RSA 2011
Assessee PAN ACCPM0960F
Bench Jaipur
Appeal Number ITA 191/JPR/2011
Duration Of Justice 8 month(s) 23 day(s)
Appellant RAJESH KUMAR MACHIWAL, Jaipur
Respondent ITO, Dausa
Appeal Type Income Tax Appeal
Pronouncement Date 25-11-2011
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted SMC
Tribunal Order Date 25-11-2011
Date Of Final Hearing 22-11-2011
Next Hearing Date 22-11-2011
Assessment Year 2001-2002
Appeal Filed On 04-03-2011
Judgment Text
1 IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH SMC JAIPUR (BEFORE SHRI N.L. KALRA ACCOUNTANT MEMBER) ITA NO. 191/JP/2011 ASSESSMENT YEAR: 2001-02 PAN ACCPM 0960 F SHRI RAJESH KUMAR MACHIWAL VS. THE ITO PROP. M/S. MANISH ENTERPRISES WARD- DAUSA NEW MANDI ROAD DAUSA DISTT. DAUSA (APPELLANT) (RESPONDENT) ASSESSEE BY: SHRI RAJEEV SOGANI DEPARTMENT BY: SHRI D.K. MEENA DATE OF HEARING: 22-11-2011 DATE OF PRONOUNCEMENT: 25-11-2011 ORDER THE ASSESSEE HAS FILED AN APPEAL AGAINST THE ORDER OF THE LD. CIT(A) ALWAR DATED 22-12-2010 FOR THE ASSESSMENT YEAR 2001-02. 2.1 THE FIRST GROUND OF APPEAL OF THE ASSESSEE IS T HAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THE TRADING ADDITION OF RS. 16 540/-. 2.2 THE AO NOTICED THAT THE ASSESSEE HAS SHOWN LOS S OF RS. 14 431/- IN GRAM ACCOUNT. THE CLOSING STOCK OF GRAM WAS VALUED AT RS. 1310/- PER QTL. THE GRAM WAS SOLD ON 20-03- 01 AND 27-03-01 @ RFS 1431/- PER QTL. THE METHOD OF VALUATION OF CLOSING STOCK IS AT MARKET PRICE. THE AO THEREFORE HELD THAT CLOSING S TOCK HAS BEEN UNDER-VALUED AND HELD THAT THE STOCK SHOULD BE VALUED AT RS. 1431/- PER Q TL. ACCORDINGLY THE AO MADE THE TRADING ADDITION OF RS. 16 540/-. 2 2.3 BEFORE THE LD. CIT(A) IT WAS STATED THAT THE S TOCK LEFT AT THE END OF THE YEAR WAS INFECTED AND THEREFORE THE VALUE WAS TAKEN AT RS. 1310/- PER QTL. THE LD. CIT(A) STATED THAT NO EVIDENCE OF INFECTION OF CHANA WAS MADE AVA ILABLE BY THE ASSESSEE. 2.4 I HAVE HEARD BOTH THE PARTIES. THE PURCHASES OF GRAM WERE MADE IN THE MONTH OF JUNE 2000 WHILE THE SALES WERE MADE IN THE MONTH OF MARCH 2001. THERE WAS A GAP OF NINE MONTHS. WHEN THE A IS CONTENDING CERTAIN FACTS THEN SUCH FACTS ARE EITHER TO BE ACCEPTED OR MATERIAL SHOULD BE GATHERED SO THAT THE FACTS ARE INCORRECT. THE CLOSING STOCK AT THE END OF THE YEAR HAS BEEN SOLD IN SUBSEQUENT YEAR. THERE IS NOTHING ON RECORD TO SUGGEST THAT THE GRAM LEFT IN THE CLOSING STOCK WAS SOLD AT PREVAILING MARKET PRICE. MOREOVER THE ISSUE IS REVENUE NEUTRAL. I THEREFORE FEEL THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE TRADING ADDITION OF RS. 16 540/-. 3.1 THE SECOND GROUND OF APPEAL OF THE ASSESSEE IS THAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION ON ACCOUNT OF CASH CREDIT U/S 68 THE ACT. 3.2 I HAVE HEARD BOTH THE PARTIES. IN THE CASE OF S HRI RAM PHOOL MEENA THE AO HAS ADDED A SUM OF RS. 1 500/- WHICH REPRESENTED INTERE ST PAYMENT. HOWEVER THE LD. CIT(A) HAS ENHANCED THE ADDITION TO RS. 16 500/-. THE ENHA NCEMENT MADE BY RS. 15 000/ WAS NOT MADE AFTER ISSUANCE OF SHOW CAUSE NOTICE. THUS THE ADDITION OF RS. 15 000/- IS AGAINST THE PROVISIONS OF LAW AND THEREFORE THE SUCH ADDITION IS DELETED. 3.3 THE LD. CIT(A) HAS CONFIRMED THE ADDITION U/S 6 8 OF THE ACT TO THE EXTENT OF RS. 19 500/- RECEIVED FROM SHRI SITA RAM GUPTA. THE ASS ESSEE HAS FILED THE AFFIDAVIT OF SHRI SITA RAM GUPTA AND HIS STATEMENT WAS ALSO RECORDED. THE CASH CREDITOR HAS ACCEPTED THE ADVANCING OF LOAN. IN VIEW OF THE FOLLOWING JDUGEME NTS OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASES OF 3 1. KANHAIALAL JANGID VS. ACIT 217 CTR 354(RAJ.) 2. ARAVALI TRADING CO. VS. ITO 220 CTR 622 (RAJ.) 3. LABH CHAND BOHRA VS. ITO 189 TAXMAN 141 (RAJ.) 4. ACIT VS. M/S. RAJASTHAN ASBESTORS CEMENT CO. JAIPUR (ITA NO. 940/JP/2008 I HOLD THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN CON FIRMING THE ADDITION OF RS. 19 500/-. 4.1 THE THIRD GROUND OF APPEAL OF THE ASSESSEE IS T HAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 15 000/- ON ACCOUNT OF HOUSE HOLD EXPENSES. 4.2 THE ASSESSEE HAS SHOWN THE WITHDRAWAL OF RS. 55 081/- AND THE FAMILY OF THE ASSESSEE CONSISTS OF 05 MEMBERS. THREE CHILDREN ARE SCHOOL GOING. THE AO ESTIMATED THE EXPENDITURE OF RS. 80 000/- AND ACCORDINGLY MADE TH E ADDITION OF RS. 25 000/-. 4.3 THE LD. CIT(A) HAS RESTRICTED THE ADDITION TO R S. 15 000/-. 4.4 I HAVE HEARD BOTH THE PARTIES AND ON PERUSAL OF THE MATERIALS AVAILABLE ON RECORD I DO NOT FEEL TO INTERFERE IN THE ORDER OF THE LD. CI T(A). 5. IN THE RESULT THE APPEAL OF THE ASSESSEE IS PA RTLY ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 25-11 -2011. SD/- (N.L. KALRA) ACCOUNTANT MEMBER JAIPUR DATED: 25/11/2011 *MISHRA COPY FORWARDED TO:- 1. SHRI RAJESH KUMAR MACHIWAL DAUSA 2.THE I.T.O. WARD DAUSA BY ORDER 3.THE LD. CIT(A) 4.THE LD. CIT 5.THE LD. DR 6.THE GUARD FILE (I.T.A. NO 191/JP/11) A.R. ITAT: JAIPUR 4