Shikhar Yarns Pvt.Ltd.,, Surat v. The Income tax Officer,Ward-4(2),, Surat

ITA 2870/AHD/2009 | 2000-2001
Pronouncement Date: 30-03-2012 | Result: Allowed

Appeal Details

RSA Number 287020514 RSA 2009
Assessee PAN AADCS3951N
Bench Ahmedabad
Appeal Number ITA 2870/AHD/2009
Duration Of Justice 2 year(s) 5 month(s) 14 day(s)
Appellant Shikhar Yarns Pvt.Ltd.,, Surat
Respondent The Income tax Officer,Ward-4(2),, Surat
Appeal Type Income Tax Appeal
Pronouncement Date 30-03-2012
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted C
Tribunal Order Date 30-03-2012
Date Of Final Hearing 28-03-2012
Next Hearing Date 28-03-2012
Assessment Year 2000-2001
Appeal Filed On 16-10-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH AHMEDABAD .. '# ' $ BEFORE SHRI MUKUL KR.SHRAWAT JUDICIAL MEMBER AND SHRI T.R. MEENA ACCOUNTANT MEMBER ./ I.T.A. NO.2870/AHD/2009 ( & ' & ' & ' & ' / / / / ASSESSMENT YEAR : 2000-01) SHIKHAR YARNS PVT.LTD. 2 ND FLOOR AMARSHILP APT. NANPURA TIMALIYAWAD SURAT & & & & / VS. THE ITO WARD-4(2) SURAT ( '# ./)* ./ PAN/GIR NO. : AADCS 3951 N ( (+ / // / APPELLANT ) .. ( -(+/ RESPONDENT ) (+ . '/ APPELLANT BY : SHRI TUSHAR HEMANI -(+ / . ' / RESPONDENT BY : SHRI VINOD TANWANI SR.D.R. &0 / #/ // / DATE OF HEARING : 28/03/2012 12' / # / DATE OF PRONOUNCEMENT : 30/03/12 '3/ O R D E R PER SHRI MUKUL KR. SHRAWAT JUDICIAL MEMBER : THIS IS AN APPEAL AT THE BEHEST OF THE ASSESSEE WHICH HAS EMANATED FROM THE ORDER OF LEARNED CIT(APPEALS)-III SURAT DATED 10/08/2009 PASSED FOR A.Y. 2000-01 AND THE SOLITARY SUBSTANTIAL GROUND READS AS UNDER:- 1. ON FACTS AND CIRCUMSTANCES OF THE CASE THE LEA RNED CIT(A) HAS ERRED IN SUSTAINING THE PENALTY OF RS.5 61 676/- ERRONEOU SLY LEVIED BY THE LEARNED AO WITHOUT APPRECIATING THE FACTS AND MERIT S OF THE CASE. ITA NO. 2870/AHD/2009 SHIKAR YARNS PVT.LTD. VS. ITO ASST.YEAR - 2000-01 - 2 - 2. FACTS IN BRIEF AS EMERGED FROM THE CORRESPONDING PENALTY ORDER PASSED U/S.271(1)(C) OF THE I.T. ACT 1961 DATED 2 4/03/2009 AND THE ASSESSMENT ORDER MADE U/S.143(3) R.W.S. 147 OF THE I.T.ACT DATED 27/12/2006 WERE THAT ON THE BASIS OF AN INFORMATIO N RECEIVED FROM DIT(INV.)-II MUMBAI IT WAS NOTICED THAT THE ASSESS EE HAD UTILIZED FORGED ADVANCE LICENCE I.E. ARO (ADVANCE RELEASE ORDER) F OR AN AMOUNT OF RS.48.63 LACS. TO PROCURE THE SAID LICENCE THERE WERE TWO MIDDLE-MEN STATED TO BE S/SHRI HASTIMAL JAIN AND ROOPCHAND JA IN. THEIR RESPECTIVE STATEMENTS WERE RECORDED U/S.131 OF THE I.T.ACT. I T WAS FOUND THAT NO GOODS WERE SENT AND THERE WAS ONLY PAPER TRANSACTIO N. IT WAS ALSO ADMITTED IN THE STATEMENT THAT A PREMIUM @ 30% WAS RECEIVED. AN ANOTHER ASPECT WAS ALSO NOTED BY THE ASSESSING OFFI CER THAT ONE OF THE DIRECTOR NAMELY SHRI KETAN M.SHAH HAS ALSO BEEN EX AMINED AND HIS STATEMENT WAS RECORDED. ON THE BASIS OF THEIR STAT EMENTS 30% OF THE LICENCE VALUE I.E. RS.14 58 900/- WAS HELD AS PREM IUM PAID IN CASH AND THE SAID AMOUNT WAS TAXED AS UNEXPLAINED EXPENDITUR E U/S.69-C OF THE I.T.ACT 1961. THE SAID ADDITION WAS THE SUBJECT M ATTER OF LEVY OF CONCEALMENT PENALTY. 3. FROM THE SIDE OF THE ASSESSEE LD.AR MR.TUSHAR H EMANI APPEARED AND STATED THAT THE ASSESSEE WAS SUFFERING HUGE LOS SES THEREFORE THE SAID ADDITION WAS NOT CONTESTED BEFORE THE LEARNED CIT(A PPEALS) THOUGH AN APPEAL WAS FILED. HE HAS PLEADED THAT THOUGH THE Q UANTUM ADDITION STOOD AFFIRMED BUT FOR THE PURPOSE OF LEVY OF CONCEALMENT PENALTY THE MERITS OF THE ADDITION DESERVE TO BE CONSIDERED AFRESH BECAUS E THE PENALTY PROCEEDINGS ARE SEPARATE AND INDEPENDENT PROCEEDING S. HIS MAIN PLANK OF ARGUMENT IS THAT THE IMPUGNED ADDITION WAS MEREL Y AN ESTIMATED ITA NO. 2870/AHD/2009 SHIKAR YARNS PVT.LTD. VS. ITO ASST.YEAR - 2000-01 - 3 - ADDITION BECAUSE ONLY 30% WAS PRESUMED AS UNEXPLAIN ED EXPENDITURE. HE HAS ALSO PLEADED THAT ALTHOUGH THE STATEMENTS OF THOSE MIDDLE-MEN HAVE BEEN RECORDED ALONG WITH THE STATEMENT OF ONE OF THE DIRECTORS OF THE ASSESSEE-COMPANY BUT THERE WAS NO SPECIFIC OR DIRECT EVIDENCE IN THE POSSESSION OF THE REVENUE DEPARTMENT TO DEMONSTRATE THAT THE IMPUGNED PREMIUM HAS ACTUALLY BEEN PAID BY THE ASSESSEE. HE HAS THEREFORE PLEADED THAT THE PENALTY DESERVES TO BE DELETED. 4. FROM THE SIDE OF THE REVENUE LD.SR.DR MR.VINOD TANWANI APPEARED AND SUPPORTED THE ORDERS OF THE AUTHORITIE S BELOW. WE HAVE HEARD BOTH THE SIDES AT SOME LENGTH. WE HAVE ALSO PERUSED THE STATEMENT RECORDED AND THE COMPILATION FILED. REVENUE AUTHO RITIES HAVE EXAMINED THE REASON OF ALLEGED EXISTENCE OF ARO LICENCE AND HAVE NOTED THAT CERTAIN EXPORT ORIENTED UNITS USED TO BUY ARO (ADVA NCE RELEASE ORDER) TO FULFILL THEIR EXPORT OBLIGATIONS. SINCE THE ARO S ARE NOT MARKETABLE THEREFORE FOR GETTING SUCH LICENCE A PREMIUM WAS UN OFFICIALLY PAID TO GET HOLD OF SUCH LICENCES. A PERTINENT QUESTION HAS BE EN RAISED THAT IF THE ASSESSEE OBTAINED ARO THEN HOW MUCH RELATED INCOME WAS DISCLOSED BY THE ASSESSEE AND WHETHER IT WAS ALSO DISCLOSED AND TAXED. FACTS HAVE REVEALED THAT THE ASSESSEE HAS UTILIZED THE IMPUGNE D LICENCE FOR AN AMOUNT OF RS.48.63 LACS. HOW THIS AMOUNT WAS UTILI ZED AND WHETHER THE ASSESSEE HAS ACTUALLY BENEFITED BY THOSE LICENCES W ITH THE HELP OF THOSE MIDDLE-MEN HAVE NOT BEEN CONCLUSIVELY ESTABLISHED. THE ONLY CASE WHICH WAS MADE OUT BY THE REVENUE DEPARTMENT WAS TH AT THE ASSESSEE WOULD HAVE PAID A PREMIUM IN CASH. THAT AMOUNT OF PREMIUM WAS ALSO NOT CONFIRMED AND IN THE ABSENCE OF ANY SPECIFIC AM OUNT OF CASH PREMIUM THE ASSESSING OFFICER HAS PROCEEDED TO ESTI MATE THE CASH ITA NO. 2870/AHD/2009 SHIKAR YARNS PVT.LTD. VS. ITO ASST.YEAR - 2000-01 - 4 - PREMIUM @ 30% OF THE UTILIZED VALUE I.E. RS.48.63 LACS. THEREFORE A CONCLUSION CAN BE DRAWN THAT THE FIRST PRESUMPTION OF THE REVENUE WAS THAT SOME MIDDLEMEN WAS INVOLVED THE SECOND PRESUM PTION WAS THAT THOSE MIDDLEMEN HAVE HELPED IN PROCURING THE ARO LI CENCE AND THE THIRD PRESUMPTION WAS THAT THE ASSESSEE HAS PAID A CASH P REMIUM TO THOSE MIDDLEMEN. THOUGH UNDISPUTEDLY THE QUANTUM ADDITI ON HAS BEEN CONFIRMED BUT WITHOUT DISTURBING THE SAID QUANTUM A DDITION WE ARE OF THE CONSIDERED VIEW THAT AS FAR AS THE PENALTY PROC EEDINGS ARE CONCERNED THE ISSUE OF ALLEGED PAYMENT OF PREMIUM HAS TO BE D ECIDED INDEPENDENTLY IN CONCEALMENT PENALTY PROCEEDINGS. IN THE PRESE NT CASE THE ASSESSEE HAS RAISED CERTAIN SERIOUS DOUBTS AND AFTER DUE CON SIDERATION OF THOSE DEFENCE WE HEREBY HOLD THAT THE ASSESSEE HAS OFFER ED AN EXPLANATION AND THAT EXPLANATION WAS ALSO SUBSTANTIATED BY CERTAIN CORROBORATIVE EVIDENCES AND IN THE ABSENCE OF ANY DIRECT INCRIMIN ATING MATERIAL AGAINST THE ASSESSEE THE CONCEALMENT PENALTY WAS WRONGLY IM POSED. IN THE ABSENCE OF A DIRECT CONVINCING EVIDENCE ABOUT THE CASH PAYMENT OF PREMIUM WE HEREBY HOLD THAT THE ASSESSEE DESERVES THE BENEFIT OF DOUBT HENCE WE HEREBY HOLD THAT THE PENALTY DESERVES TO B E DELETED. WE ORDER ACCORDINGLY. 5. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWE D. SD/- SD/- ( .. ) ( ) '# ( T.R. MEENA ) ( MUKUL KR. SHRAWAT ) ACCOUNTANT MEMBER JUDICIAL ME MBER AHMEDABAD; DATED 30/ 03 /2012 ..& .&../ T.C. NAIR SR. PS ITA NO. 2870/AHD/2009 SHIKAR YARNS PVT.LTD. VS. ITO ASST.YEAR - 2000-01 - 5 - '3 / 4 5'4' '3 / 4 5'4' '3 / 4 5'4' '3 / 4 5'4'/ COPY OF THE ORDER FORWARDED TO : 1. (+ / THE APPELLANT 2. -(+ / THE RESPONDENT. 3. 6 / CONCERNED CIT 4. 6() / THE CIT(A)-III SURAT 5. 49: & / DR ITAT AHMEDABAD 6. :; <0 / GUARD FILE. '3& '3& '3& '3& / BY ORDER -4 //TRUE COPY// = == =/ // / ) ) ) ) ( DY./ASSTT.REGISTRAR) / ITAT AHMEDABAD 1. DATE OF DICTATION..28.3.12 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 28.3.12 OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.30.3.12 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 30.3.12 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 9. DATE OF DESPATCH OF THE ORDER