M/s Reliable Sakh Sehkarita Maryadit, v. The DCIT 4 (2),

ITA 308/IND/2008 | misc
Pronouncement Date: 04-05-2010 | Result: Partly Allowed

Appeal Details

RSA Number 30822714 RSA 2008
Bench Indore
Appeal Number ITA 308/IND/2008
Duration Of Justice 1 year(s) 9 month(s) 27 day(s)
Appellant M/s Reliable Sakh Sehkarita Maryadit,
Respondent The DCIT 4 (2),
Appeal Type Income Tax Appeal
Pronouncement Date 04-05-2010
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted DB
Tribunal Order Date 04-05-2010
Date Of Final Hearing 26-04-2010
Next Hearing Date 26-04-2010
Assessment Year misc
Appeal Filed On 08-07-2008
Judgment Text
1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH INDORE BEFORE SHRI JOGINDER SINGH JUDICIAL MEMBER AND SHRI V.K. GUPTA ACCOUNTANT MEMBER ITA NOS. 308 & 309/IND/2008 A.YS. 2003-04 & 2004-05 M/S RELIABLE SAKH SAHKARITA MARYADIT INDORE APPELLANT PAN AAABR-0143D VS DY. COMMISSIONER OF INCOMETAX CIRCLE 4(2) INDORE RESPONDENT APPELLANT BY : SHRI HP VERMA AND SHRI A.GOYA L RESPONDENT BY : SMT. APARNA KARAN SR. DR O R D E R PER JOGINDER SINGH JM THESE APPEALS ARE BY THE ASSESSEE AGAINST THE ORDE RS OF THE LEARNED CIT(A) DATED 28.3.2008 WHEREIN FOLLOWING GR OUNDS HAVE BEEN RAISED :- ITA NO. 308/IND/2008 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE:- 1. THE ASSESSMENT ORDER PASSED IS BAD-IN-LAW NOT SUSTAINABLE BARRED BY LIMITATION CONTRARY TO 2 MATERIAL AND LAW WITHOUT JURISDICTION ILLEGAL AND THEREFORE LIABLE TO BE QUASHED. 2. THE LD. CIT(A) ERRED IN SUSTAINING THE ASSESSMENT ORDER WHICH IS BARRED BY LIMITATION PASSED WITHOUT JURISDICTION BAD-IN-LAW CONTRARY TO MATERIAL AND LAW AND WAS ILLEGAL. 3. THE LD. CIT(A) ERRED IN SUSTAINING THE ASSESSMENT ORDER WHICH WAS NOT PASSED ON THE ASSESSEE SOCIETY 4. THE LD. CIT(A) ERRED IN HOLDING THAT ON 18.03.08 24.03.08 AND 28.03.08 SUMMONS COULD NOT BE SERVED ON THE APPELLANT-ASSESSEE WHEREAS THE APPELLANT WAS AVAILABLE AT THE GIVEN ADDRESS. FURTHER THE ADDRESS MENTIONED IN FORM 35 IS THAT OF THE COUNSEL. 5. THE LD. CIT(A) ERRED IN SUSTAINING THE ADDITION OF RS.10 27 500 BEING UNEXPLAINED DEBTORS. 6. THE LD. CIT(A) ERRED IN SUSTAINING THE ADDITION OF RS.5 000 OF ENTERTAINMENT EXPENSES WITHOUT ANY SUFFICIENT REASONS THEREOF. ITA NO. 309/IND/2008 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE:- 1. THE ASSESSMENT ORDER PASSED IS BAD-IN-LAW NOT SUSTAINABLE BARRED BY LIMITATION CONTRARY TO MATERIAL AND LAW WITHOUT JURISDICTION ILLEGAL AND THEREFORE LIABLE TO BE QUASHED. 2. THE LD. CIT(A) ERRED IN SUSTAINING THE ASSESSMENT ORDER WHICH IS BARRED BY LIMITATION PASSED WITHOUT JURISDICTION BAD-IN- LAW CONTRARY TO MATERIAL AND LAW AND WAS ILLEGAL. 3. THE LD. CIT(A) ERRED IN SUSTAINING THE ADDITION OF RS.3 69 445 BEING CASH CREDITS U/S 68 . DURING HEARING OF THESE APPEALS GROUND NO. 1 TO 4 (ITA NO. 308/IND/2008) AND GROUND NO. 1 AND 2 (ITA NO. 309/I ND/2008) WERE NOT 3 PRESSED BY THE LD. COUNSEL FOR THE ASSESSEE CONSEQ UENTLY THESE GROUNDS ARE DISMISSED AS NOT PRESSED. 2. THROUGH GROUND NO. 5 THE ASSESSEE HAS CHALLENGE D SUSTENANCE OF ADDITION OF RS. 10 27 500/- BEING UN EXPLAINED DEBTORS. THE CRUX OF ARGUMENTS ON BEHALF OF THE ASSESSEE IS THAT THE ASSESSEE SOCIETY FACILITATES ITS MEMBERS AND OTHER TO SAVE T HE COST OF ISSUE OF OUTSTATION DDS/CHEQUES ETC. REQUIRED BY THEM FOR T HEIR REGULAR BUSINESS. AS PER THE ASSESSEE THE ASSESSEE SOCIETY IS HAVING CURRENT ACCOUNTS WITH VARIOUS BANKS LIKE UTI CENTURION IDBI ETC. AND CHARGE COMMISSION @ 1 TO 2 PER THOUSAND AGAINST THE BANK R ATE OF 3 TO 7 PER THOUSAND. THE FACILITY WAS CLAIMED TO BE FREE OF C HARGE. IT WAS FURTHER EXPLAINED THAT THE CLIENT TRADER TENDERS CASH OR C HEQUES TO THE SOCIETY AND IN TURN THE ASSESSEE SOCIETY ISSUES CHEQUES AT PAR AND NORMALLY THE MONEY RECEIVED BY THE ASSESSEE FROM CLIENT-TRADERS IS DEPOSITED IN ITS BANK BY FILING IN THE PAY-IN-SLIPS. THE LD. COUNSEL FOR THE ASSESSEE EXPLAINED THAT ROUGH NOTINGS ARE MADE IN THE BEGINN ING WHICH ARE VERIFIABLE FROM PAYING SLIPS. ON A QUERY FROM THE B ENCH IT WAS EXPLAINED THAT IN EXCEPTIONAL CASES NON-MEMBERS ARE ALSO PAI D BUT NOT ON REGULAR BASIS. THE BOOKS OF ACCOUNTS WERE ALSO CLAIMED TO B E MAINTAINED FOR WHICH OUR ATTENTION WAS INVITED TO PAGES 94 TO 100 (ROUGH PAGES) OF THE PAPER BOOK. THE CRUX OF ARGUMENTS ON BEHALF OF THE ASSESSEE IS THAT THE OPPORTUNITY TO CROSS EXAMINE AND ALSO TO EXPLAIN WA S NOT PROVIDED TO THE 4 ASSESSEE AND THE ADDITION WAS MADE MERELY ON THE BA SIS OF PAY-IN-SLIP. ON THE OTHER HAND THE LEARNED COUNSEL FOR THE REV ENUE DEFENDED THE IMPUGNED ORDER BY FURTHER SUBMITTING THAT DUE OPPOR TUNITY WAS PROVIDED TO THE ASSESSEE. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF LD. REPRESENTATIVES OF BOTH SIDES AND PERUSED THE MATER IAL AVAILABLE ON RECORD. WE HAVE FOUND THAT THE IMPUGNED AMOUNT REPR ESENTS THE CHEQUES ISSUED BY THE ASSESSEE BUT UPTO THE TIME PR ESCRIBED NOT REPAID BY THE CLIENT TRADERS AT THE TIME OF CLEARING OF CH EQUES AND THE IMPUGNED AMOUNTS WERE SUBSEQUENTLY PAID EITHER ON THE SAME D ATE OR WITHIN TWO OR THREE DAYS BUT BEFORE ENCASHMENT OF CHEQUES. TH E ASSESSING OFFICER INVOKED THE PROVISIONS OF SECTION 69 OF THE ACT BY HOLDING THAT THE INCOME OF THE ASSESSEE IS FROM UNEXPLAINED DEBTORS. HOWEVER WE HAVE FOUND THAT DUE OPPORTUNITY WAS NOT PROVIDED TO THE ASSESSEE TO SUBSTANTIATE ITS CLAIM AND EVEN REQUEST WAS MADE BY THE ASSESSEE TO ISSUE SUMMONS U/S 131 OF THE ACT WHICH WAS NOT DONE BY THE ASSESSING OFFICER. IT IS ALSO AN UNDISPUTED FACT THAT THE CHE QUES WERE ALSO CLEARED AND THERE IS NO CLEAR-CUT DENIAL BY THE PARTIES AND THE IMPUGNED ADDITION HAS BEEN MADE MERELY ON THE BASIS OF PAY-IN-SLIP. IN VIEW OF THESE FACTS THIS GROUND IS REMANDED TO THE FILE OF THE A SSESSING OFFICER FOR FRESH ADJUDICATION IN ACCORDANCE WITH LAW. THE ASSE SSEE MAY ALSO BE ALLOWED INSPECTION OF RECORD AND CROSS EXAMINATION IF REQUIRED BY THE 5 ASSESSEE CONSEQUENTLY THIS GROUND IS ALLOWED FOR STATISTICAL PURPOSES ONLY. THIS WILL ALSO COVER GROUND NO. 3 OF ITA NO. 309/IND/2008 ALSO. 4. THE LAST GROUND PERTAINS TO CHALLENGING THE ADDI TION OF RS.5000/- ON ENTERTAINMENT EXPENSE (ITA NO. 308/IND /08). THE IMPUGNED AMOUNT WAS CLAIMED TO BE EXPENSES ON TEA COFFEE AND OTHER ENTERTAINMENT EXPENSES FOR OTHER BUSINESS PURPOSES. IT IS SEEN THAT THE ASSESSEE CLAIMED ENTERTAINMENT EXPENSES AMOUNTING T O RS. 40 950/- OUT OF WHICH AN AD HOC DISALLOWANCE OF RS. 5000/- W AS MADE FOR WANT OF VOUCHERS AND VERIFICATION. HOWEVER WE HAVE SEEN TH E WRITTEN SUBMISSIONS FILED BY THE ASSESSEE BEFORE THE REVENU E AUTHORITIES WHEREIN IT HAS BEEN CLAIMED THAT ALL THE BOOKS OF A CCOUNTS WERE PRODUCED BEFORE THE ASSESSING OFFICER. THE AD HOC DISALLOWANCE IS NOT SUPPORTED BY ANY SPECIFIC FINDING. CONSEQUENTLY K EEPING IN VIEW THE SMALLNESS OF THE AD-HOC DISALLOWANCE THIS GROUND O F THE ASSESSEE IS ALLOWED. FINALLY THE APPEALS OF THE ASSESSEE ARE PARTLY ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 4 TH MAY 2010. SD SD (V.K. GUPTA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER MAY 4 TH 2010 COPY TO: APPELLANT RESPONDENT CIT CIT(A) DR G UARD FILE 6 *DBN/