Shri Pradeep Kumar Khandelwal, v. The ITO 5 (2),

ITA 284/IND/2008 | 2004-2005
Pronouncement Date: 24-02-2010 | Result: Partly Allowed

Appeal Details

RSA Number 28422714 RSA 2008
Assessee PAN ACMPK2988D
Bench Indore
Appeal Number ITA 284/IND/2008
Duration Of Justice 1 year(s) 8 month(s)
Appellant Shri Pradeep Kumar Khandelwal,
Respondent The ITO 5 (2),
Appeal Type Income Tax Appeal
Pronouncement Date 24-02-2010
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted DB
Tribunal Order Date 24-02-2010
Date Of Final Hearing 01-02-2010
Next Hearing Date 01-02-2010
Assessment Year 2004-2005
Appeal Filed On 23-06-2008
Judgment Text
1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH INDORE BEFORE SHRI JOGINDER SINGH AND SHRI V.K. GUPTA AM ITA NO.284/IND/08 A.Y. 2004-05 PRADEEP KUMAR KHANDELWAL PROP. M/S. HIRA COTTON FIBERS INDORE (PAN ACMPK 2988 D) .APPELLANT VS ASSISTANT COMMISSIONER OF INCOME TAX 5(2) INDORE .RESPONDENT APPELLANT BY : SHRI R.P. MANDOVARA ADV. RESPONDENT BY : SMT. APARNA KARAN SR. DR O R D E R PER JOGINDER SINGH JM THIS APPEAL IS BY THE ASSESSEE AGAINST THE ORDER OF THE LEARNED CIT(A) DATED 18.3.2008. THE FIRST GROUND RAISED IS THAT ON THE F ACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LEARNED COMMISSIONER OF INCOME-TAX (A PPEALS) ERRED IN ENHANCING THE ALLEGED HOUSEHOLD WITHDRAWALS FROM RS.36 000/- TO RS.1 68 000/- WHICH IS ARBITRARY AND UNWARRANTED. DURING HEARING WE HAVE HEARD SHRI R.P. MANDOVARA LEARNED COUNSEL FOR THE ASSESSEE AND SMT. APARNA KA RAN LEARNED ADDL. CIT SR. DR. THE CRUX OF ARGUMENTS ON BEHALF OF THE ASSESSEE IS THAT THE ASSESSEE IS DEALING IN COTTON BUSINESS I.E. TRADING AND MANUFACTURING I N COTTON GETTING IT GINNED FROM WHICH RUI AND COTTON SEEDS ARE DERIVED. THE ASSESSEE SHOWED RS.94 389/- AS 2 HOUSEHOLD WITHDRAWALS. THE ASSESSEE IS A FAMILY OF FOUR MAJOR PERSONS ALONG WITH ONE DAUGHTER OF FOUR MONTHS. THE ASSESSING OFFICER E STIMATED RS.3000/- PER MONTH APART FROM REGULAR WITHDRAWALS IN JOINT FAMILY CON SEQUENTLY RS.36 000/- WERE ADDED TO POCKET EXPENSES. ON APPEAL THE LD. CIT(A) ENHANCED THE HOUSEHOLD WITHDRAWALS AND DIRECTED TO BE TAKEN AT RS.1 68 000 /-. THUS THE AMOUNT OF RS.1 32 000/- WAS ENHANCED. ON CONSIDERATION OF TOT AL FACTS IT WAS CLAIMED BY THE ASSESSEE THAT THERE IS NO VEHICLE MAINTAINED BY THE ASSESSEE AND ALSO NO MAID SERVANT. IN THE JOINT FAMILY THE WITHDRAWALS OF RS .3 61 726/- WAS CLAIMED. HOWEVER THE LD. DR POINTED OUT THAT THERE IS NO JO INT FAMILY AS THE ASSESSEE FAMILY IS LIVING SEPARATELY. WE HAVE FOUND THAT CLEAR FACT S ARE NOT OOZING OUT THEREFORE WITHOUT COMMENTING FURTHER WE DIRECT THE ASSESSING OFFICER THAT IT WILL BE SUFFICIENT IF FOR THE INDIVIDUAL FAMILY OF THE ASSE SSEE THE WITHDRAWALS ARE TAKEN AT RS.5 000/- PER MONTH FOR HOUSEHOLD EXPENSES WHICH C OMES TO RS.60 000/- THEREFORE THE ASSESSING OFFICER IS DIRECTED TO ADO PT THE FIGURE OF RS.60 000/- AND CALCULATE ACCORDINGLY THEREFORE THIS GROUND OF TH E ASSESSEE IS PARTLY ALLOWED. 2. THROUGH NEXT GROUND THE ASSESSEE HAS CHALLENGED THE ADDITION OF RS.7 55 831/- FOR UNDERVALUATION OF CLOSING STOCK. THE CONTENTION RAISED ON BEHALF OF THE ASSESSEE IS THAT TWO KINDS OF KAPAS I.E. A & B WAS PURCHASED BY THE ASSESSEE OUT OF WHICH THE ASSESSEE ONLY GINNED A QUALITY KAP AS AND SOLD THE SAME. THE B QUALITY KAPAS WAS NOT GINNED WHICH REMAINED IN THE STOCK AND WAS VALUED AT THE COST PRICE. AS PER THE ASSESSEE A & B QUALITIES BO TH WERE CONSIDERED BY THE ASSESSING OFFICER WHEREAS THE B QUALITY PURCHASE WA S ONLY 1/3 RD OF THE TOTAL 3 PURCHASES. IT WAS POINTED OUT THE PURCHASE PRICE OF A QUALITY COTTON WAS RS.12 523.27 AND THAT OF B QUALITY WAS ONLY RS.853. 90 ONLY. IT WAS POINTED OUT THAT THE ASSESSEE IS NOT HAVING ANY GINNING FACTORY. ON THE OTHER HAND THE LD. SR. DR DEFENDED THE IMPU GNED ORDER BY CONTENDING THAT NO DETAILS AS CLAIMED BY THE ASSES SEE WERE FURNISHED THEREFORE THE ASSESSEE IS DELIBERATELY INTERMINGLING BOTH THE QUALITIES SIMPLY TO DEFRAUD THE REVENUE. 3. ON CONSIDERATION OF RIVAL SUBMISSIONS WE HAVE F OUND THAT TRUE FACTS ARE NOT OOZING OUT AS THE ASSESSEE HAS NOT EXPLAINED THAT A S AND WHEN THE B GRADE KAPAS WAS PROCESSED/GINNED AND ULTIMATELY WHAT HAPPED TO B GRADE KAPAS. IN VIEW OF THESE FACTS IN THE ABSENCE OF THESE DETAILS THE A SSESSEE IS DIRECTED TO FURNISH THESE DETAILS BEFORE THE ASSESSING OFFICER WHO IS DIRECTE D TO EXAMINE THE CLAIM OF THE ASSESSEE AFRESH. THE ASSESSEE IS ALSO AT LIBERTY TO FURNISH EVIDENCE IF ANY TO SUBSTANTIATE ITS CLAIM FOR WHICH DUE OPPORTUNITY BE PROVIDED TO THE ASSESSEE. THIS ISSUE IS THEREFORE ALLOWED FOR STATISTICAL PURPOS ES ONLY. IN THE RESULT THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 24 TH FEBRUARY 2010. SD SD (V.K. GUPTA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER FEBRUARY 24 TH 2010 !VYAS! 4 COPY TO APPELLANT RESPONDENT CIT CIT(A) DR GUAR D FILE