Sri Kunda Venkateswara Rao,, v. The CIT, -,, Vijayawada

ITA 525/VIZ/2008 | 2004-2005
Pronouncement Date: 08-09-2010 | Result: Dismissed

Appeal Details

RSA Number 52525314 RSA 2008
Assessee PAN AAEHK4876N
Bench Visakhapatnam
Appeal Number ITA 525/VIZ/2008
Duration Of Justice 1 year(s) 10 month(s) 19 day(s)
Appellant Sri Kunda Venkateswara Rao,,
Respondent The CIT, -,, Vijayawada
Appeal Type Income Tax Appeal
Pronouncement Date 08-09-2010
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted DB
Tribunal Order Date 08-09-2010
Assessment Year 2004-2005
Appeal Filed On 20-10-2008
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH VISAKHAPATNAM BEFORE: SHRI SUNIL KUMAR YADAV JUDICIAL MEMBER AND SHRI BR BASKARAN ACCOUNTANT MEMBER ITA NO.525/VIZAG/2008 ASSESSMENT YEAR : 2004-05 KUNDA VENKATESWARA RAO TIRUVURU CIT VIJAYAWADA (APPELLANT) VS. (RESPONDENT) PAN NO.AAEHK 4876N APPELLANT BY: SHRI B.V.S. CHALAPATHI RAO ADVOCATE RESPONDENT BY: SHRI SUBRATA SARKAR DR ORDER PER SHRI S.K. YADAV JUDICIAL MEMBER:- THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST THE ORDER PASSED BY THE CIT U/S 263 OF THE ACT SETTING ASIDE THE ORDER OF THE A.O. WITH A DIRECTION TO ADD BACK THE SUPPRESSED TURNOVER AND PROBABLE SU PPRESSED TURNOVER TO THE INCOME RETURNED AND RECOMPUTE THE TOTAL INCOME ACCORDINGLY. THOUGH THE ASSESSEE HAS RAISED VARIOUS GROUNDS OF APPEAL BUT THEY ALL RELATE TO THE VALIDITY OF THE ORDER PASSED U/S 263 OF THE ACT IN THE LIGHT OF THE FACT THAT ASSESSING OFFICER HAS ALREADY ISSUED A NOTICE U/S 1 48 OF THE I.T. ACT AND RE- OPENING PROCEEDINGS ARE PENDING ON THE SAME ISSUE. 2. THE BRIEF FACTS BORNE OUT FROM THE RECORD ARE TH AT THE REGULAR ASSESSMENT WAS COMPLETED U/S 143(3) DETERMINING THE TOTAL INCOME AT RS.5 86 230/- AND AGRICULTURAL INCOME OF RS.2 31 52 0/- AGAINST THE DECLARED INCOME OF RS.1 41 960/- BESIDES AGRICULTURAL INCOME OF RS.3 69 250/-. ON SCRUTINY THE CIT NOTICED THAT THE SUPPRESSED TURNO VER OF RS.2 50 160/- AS EVIDENT FROM THE SALES TAX ASSESSMENT ORDER DATED 2 2.7.2005 WAS OMITTED TO BE CONSIDERED BY THE A.O. WHILE COMPLETING THE ASSE SSMENT. HE ACCORDINGLY ISSUED A SHOW CAUSE NOTICE TO THE ASSESSEES AND IN RESPONSE THERETO ASSESSEE FILED A LETTER DATED 24.7.2008 STATING THE REIN THAT COMMERCIAL TAX OFFICER MADE AN ADDITION OF RS.1 25 080/- TO THE BO OK TURNOVER AS ACTUAL SUPPRESSED TURNOVER AND A FURTHER TURNOVER OF RS.1 25 080/- AS PROBABLE SUPPRESSED TURNOVER BUT THE COMMERCIAL TAX OFFICER FOUND ACTUAL SUPPRESSED 2 TURNOVER AT RS.1 22 080/- ONLY AND THE SAME WAS REC ORDED AT PG.76 ON THE PURCHASE ACCOUNT IN THE BOOKS OF ACCOUNTS MAINTAINE D. IT WAS FURTHER CONTENDED THAT THE ADDITION MADE BY THE COMMERCIAL TAX OFFICER AS PROBABLE TURNOVER ITSELF SAYS THAT IT IS ILLUSIONARY ONE AND WAS NOT BASED ON ANY EVIDENCE ON RECORD BUT BASED ON CONJUNCTURES AND SU RMISES. THIS EXPLANATION OF THE ASSESSEE WAS CONSIDERED BY THE C IT BUT HE WAS NOT CONVINCED WITH IT AND HE OBSERVED THAT ONCE THE ASS ESSEE ACCEPTED THE ACTION OF THE COMMERCIAL TAX OFFICER AND THE ADDITION TOWA RDS SUPPRESSED TURNOVER AND PROBABLE SUPPRESSED TURNOVER AND PAID TAX ON SU CH TURNOVER THE SAME SHOULD HAVE BEEN OFFERED TO TAX FOR INCOME TAX PURP OSE BUT IT WAS NOT DONE. THE A.O. HAS NOT CONSIDERED THIS ISSUE WHILE COMPLE TING THE ASSESSMENT THEREFORE THE ASSESSMENT ORDER PASSED U/S 143(3) O F THE ACT ON 28.9.2006 IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE RE VENUE. HE ACCORDINGLY SET ASIDE THE ASSESSMENT WITH A DIRECTION TO ADD BACK T HE SUPPRESSED TURNOVER AND PROBABLE SUPPRESSED TURNOVER TO THE INCOME RETU RNED AND RECOMPUTE THE TOTAL INCOME ACCORDINGLY. 3. NOW THE ASSESSEE HAS PREFERRED AN APPEAL BEFORE US WITH THE SUBMISSION THAT THE ASSESSING OFFICER HAS ISSUED A NOTICE U/S 148 OF THE I.T. ACT ON THE SAME ISSUE ON 18.9.2007 AND WHEN THE RE- OPENING PROCEEDINGS WERE PENDING BEFORE THE A.O. THE CIT HAD NO JURISD ICTION TO PASS AN ORDER U/S 263 OF THE ACT. HE HOWEVER SUBMITTED THAT THE COMPLETE DETAILS WERE PRODUCED BEFORE THE CIT BUT HE DID NOT APPRECIATE T HE SAME. 4. THE LD. D.R. ON THE OTHER HAND HAS SUBMITTED THA T IN THE ORIGINAL ASSESSMENT ORDER THE ISSUE WAS NOT EXAMINED BY THE ASSESSING OFFICER EITHER IN THE ORDER OR THROUGH A QUERY RAISED FROM THE ASS ESSEE. ASSESSING OFFICER HAVING NOTED THAT INCOME CHARGEABLE TO TAX HAS ESCA PED ASSESSMENT HAD ISSUED A NOTICE U/S 148 OF THE ACT BUT HE DID NOT C OMPLETE THE ASSESSMENT U/S 147 OF THE ACT. HE KEPT THE PROCEEDINGS PENDIN G WITHOUT FINALIZING THE SAME. THEREFORE THE ACTION OF THE ASSESSING OFFIC ER IS CERTAINLY ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE AND THE CIT IS JUSTIFIED IN PASSING AN ORDER U/S 263 OF THE I.T. ACT. 3 5. HAVING HEARD THE RIVAL SUBMISSIONS AND FROM THE CAREFUL PERUSAL OF THE ORDER OF THE LOWER AUTHORITIES WE FIND THAT UNDISP UTEDLY THE ISSUE OF SUPPRESSED TURNOVER AMOUNTING TO RS.2 50 160/- WAS NOT EXAMINED NOR ADJUDICATED BY THE ASSESSING OFFICER WHILE COMPLETI NG THE ASSESSMENT U/S 143(3) OF THE I.T. ACT. THOUGH THE ASSESSING OFFICE R HAS RE-OPENED THE ASSESSMENT ON THE SAME ISSUE BY ISSUING A NOTICE U/ S 148 OF THE ACT BUT HE DID NOT CONCLUDE THE PROCEEDINGS AND KEPT THE PROCE EDINGS IN ABEYANCE. THEREFORE THE ACTION OF THE ASSESSING OFFICER IS N OT IN ACCORDANCE WITH THE LAW. THEREFORE IT IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. UNDER THESE CIRCUMSTANCES THE REMEDY LIES WITH THE COMMISSIONER OF INCOME TAX EITHER TO DIRECT THE A.O. TO CONCLUDE THE PROCE EDINGS INITIATED U/S 147 OR TO REVISE THE ASSESSMENT ORDER ORIGINALLY FRAMED. HE HAS CHOSEN THE SECOND ONE AND REVISED THE ORDER OF THE ASSESSING OFFICER ORIGINALLY FRAMED U/S 143(3) OF THE ACT. SINCE THE ASSESSING OFFICER HAS NOT EXAMINED THE ISSUE OF SUPPRESSED TURNOVER WHICH WAS ADMITTED BY THE ASSES SEE BEFORE THE COMMERCIAL TAX OFFICER THE ORDER OF THE ASSESSING OFFICER WAS RIGHTLY HELD TO BE ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. WE THEREFORE FIND NO INFIRMITY IN THE ORDER OF THE CIT. 6. IN THE RESULT THE APPEAL OF THE ASSESSEE IS DISM ISSED. PRONOUNCED IN THE OPEN COURT ON 8.9.2010 SD/- SD/- (BR BASKARAN) (SUNIL KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER VG/SPS VISAKHAPATNAM DATED 8 TH SEPTEMBER 2010 COPY TO 1 KUNDA VENKATESWARA RAO D.NO.17-273 ASHOK NAGAR TIRUVURU-521 235 KRISHNA DIST. 2 CIT VIJAYAWADA 3 THE CIT(A) 4 THE DR ITAT VISAKHAPATNAM. 5 GUARD FILE. BY ORDER SENIOR PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM