ACIT, New Delhi v. M/s. Ultra Home Construction Pvt. Ltd., Noida

ITA 5622/DEL/2013 | 2007-2008
Pronouncement Date: 19-10-2016 | Result: Dismissed

Appeal Details

RSA Number 562220114 RSA 2013
Assessee PAN AAACU6772G
Bench Delhi
Appeal Number ITA 5622/DEL/2013
Duration Of Justice 3 year(s) 1 day(s)
Appellant ACIT, New Delhi
Respondent M/s. Ultra Home Construction Pvt. Ltd., Noida
Appeal Type Income Tax Appeal
Pronouncement Date 19-10-2016
Appeal Filed By Department
Order Result Dismissed
Bench Allotted D
Tribunal Order Date 19-10-2016
Date Of Final Hearing 13-10-2016
Next Hearing Date 13-10-2016
Assessment Year 2007-2008
Appeal Filed On 18-10-2013
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : D : NEW DELHI BEFORE SHRI R.S. SYAL ACCOUNTANT MEMBER AND MS SUCHITRA KAMBLE JUDICIAL MEMBER ITA NOS.5622 TO 5624/DEL/2013 ASSESSMENT YEARS : 2007-08 TO 2009-10 ACIT CENTRAL CIRCLE-7 ROOM NO.363 E-2 ARA CENTRE JHANDEWALAN EXTN. NEW DELHI. VS. ULTRA HOME CONSTRUCTION PVT. LTD. C-56/40 SECTOR-62 NOIDA. PAN: AAACU6772G CO NOS.35 TO 38/DEL/2015 (ITA NOS.5621 TO 5624/DEL/2013 ASSESSMENT YEARS : 2006-07 TO 2009-10 ULTRA HOME CONSTRUCTION PVT. LTD. C-56/40 SECTOR-62 NOIDA. PAN: AAACU6772G VS. ACIT CENTRAL CIRCLE-7 ROOM NO.363 E-2 ARA CENTRE JHANDEWALAN EXTN. NEW DELHI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI AMIT GOEL CA DEPARTMENT BY : SHRI I.P.S. BINDRA CIT DR ITA NOS.5622 TO 5624/D/2013 CO NOS.35 TO 38/DEL/2015 2 DATE OF HEARING : 18.10.2016 DATE OF PRONOUNCEMENT : 19.10.2016 ORDER PER BENCH: THIS BATCH COMPRISES OF THREE APPEALS BY THE REVEN UE RELATING TO THE ASSESSMENT YEARS 2007-08 TO 2009-10 AND FOUR CR OSS OBJECTIONS BY THE ASSESSEE FOR THE ASSESSMENT YEARS 2006-07 TO 20 09-10. SINCE SOME COMMON ISSUES ARE RAISED IN THIS BATCH OF APPEALS WE ARE THEREFORE PROCEEDING TO DISPOSE OF THESE APPEALS BY THIS CONS OLIDATED ORDER FOR THE SAKE OF CONVENIENCE. DEPARTMENTAL APPEAL - ASSESSMENT YEAR 2007-08 2. THE ONLY ISSUE RAISED BY THE REVENUE IN THIS APP EAL IS AGAINST THE DELETION OF ADDITION OF RS.52 76 800/- MADE BY THE AO ON ACCOUNT OF BOGUS PURCHASES OF RAW MATERIALS. 3. SUCCINCTLY THE FACTS OF THE CASE ARE THAT A SEA RCH AND SEIZURE OPERATION U/S 132 OF THE INCOME-TAX ACT 1961 (HERE INAFTER ALSO CALLED ITA NOS.5622 TO 5624/D/2013 CO NOS.35 TO 38/DEL/2015 3 THE ACT) WAS CARRIED OUT ON 9.9.2010 IN M/S AMRAP ALI GROUP OF CASES. NOTICE U/S 153A WAS ISSUED TO THE ASSESSEE IN RESPO NSE TO WHICH A RETURN DECLARING TOTAL INCOME OF RS.2 28 90 610/- WAS FILE D. ON PERUSAL OF THE PURCHASES SHOWN BY THE ASSESSEE IT WAS OBSERVED TH AT THE ASSESSEE CLAIMED TO HAVE MADE PURCHASES INTER ALIA WORTH RS.52 76 800/- FROM M/S SHREE SARASWATI STEEL CENTRE WHICH IS A PROPRIE TORSHIP CONCERN. THIS CONCERN WAS SUBJECTED TO SURVEY PROCEEDINGS U/ S 133A OF THE ACT IN WHICH THE PROPRIETOR ADMITTED THAT HE RECEIVED COMM ISSION OF 25 PAISE FOR EVER RS.100/- FOR PROVIDING ENTRY FOR SALE OF G OODS. THE ASSESSEE SHOWED TO HAVE MADE PURCHASES FROM THIS CONCERN AS UNDER:- S.NO. A/C NAME & ADDRESS DATE PARTICULARS AMOUNT 1. M/S SHREE SARASWATI STEEL CENTRE 02.07.2007 CORPORATION BANK CA010712 CHEQUE NO.931054 12 63 217 2. - DO- 08.02.2007 CORPORATION BANK CA010712 CHEQUE NO.931056 13 80 303 3. - DO- 09.02.2007 CORPORATION BANK CA010712 CHEQUE NO.931057 12 40 620 4. - DO- 10.02.2007 CORPORATION BANK CA010712 CHEQUE NO.931058 13 92 660 TOTAL 52 76 800 ITA NOS.5622 TO 5624/D/2013 CO NOS.35 TO 38/DEL/2015 4 4. FOR ASCERTAINING THE GENUINENESS OF THIS PROPRIE TORSHIP CONCERN AND THE TRANSACTIONS ENTERED BY THE ASSESSEE COMPANY AN D OTHER ENTITIES OF AMRAPALI GROUP THE AO ISSUED SUMMONS U/S 131 REQUI RING THE PARTY TO ATTEND THE PROCEEDINGS AND SUBMIT THE EVIDENCE IN S UPPORT OF SALE OF GOODS TO THESE COMPANIES. THE SUMMONS WERE RETURNE D UNSERVED. SUBSEQUENTLY AN INSPECTOR OF THE CIRCLE WAS DEPUTE D TO IDENTIFY THE PARTY AND ASCERTAIN ITS GENUINENESS. THE INSPECTOR REPORTED THAT NO SUCH PARTY EXISTED AT THE GIVEN ADDRESSES. LATER ON FU RTHER SUMMONS WERE ISSUED WHICH AGAIN REMAINED UNSERVED. THE ASSESS EE WAS APPRISED AS TO THE INQUIRIES CONDUCTED IN TERMS OF THE SUMMONS U/S 131 AND THE PHYSICAL INQUIRY CONDUCTED BY THE INSPECTOR. THE A SSESSEE WAS CALLED UPON TO PRODUCE THE ABOVE PARTY ALONG WITH ITS BOOK S OF ACCOUNT FOR PROVING THE GENUINENESS OF THE TRANSACTIONS. IN TH E ABSENCE OF ANY APPEARANCE PUT IN BY THE ASSESSEE THE AO TREATED P URCHASES OF RS.52 76 800/- MADE FROM M/S SHREE SARASWATI STEEL CENTRE AS BOGUS AND MADE ADDITION FOR THE EQUAL SUM. THE LD. CIT(A ) DELETED THE ADDITION BY OBSERVING THAT THE ASSESSEE PRODUCED CO PY OF ACCOUNT ITA NOS.5622 TO 5624/D/2013 CO NOS.35 TO 38/DEL/2015 5 PURCHASE BILLS FREIGHT BILLS AND DHARMA KANTA WEIG HING BILLS IN SUPPORT OF THE GENUINENESS OF THE PURCHASE TRANSACTIONS AND THE SAID PARTY COULD NOT BE PRODUCED BECAUSE IT WAS NOT IN EXISTENCE AT THE TIME OF ASSESSMENT AND HAD LEFT THE PREMISES. HE FURTHER NOTICED THAT M/S SHREE SARASWATI STEEL CENTRE WAS DULY REGISTERED WITH THE VAT AUTHO RITIES. APPROPRIATE COURSE OF ACTION FOR THE AO IN THE VIEW OF THE LD. CIT(A) WAS TO INFORM THE VAT AUTHORITIES ABOUT THE TAX DEDUCTED SO THAT THE DEPOSIT OF TAX COULD HAVE BEEN VERIFIED BY THEM. HE STILL FURTHER NOTICED THAT THE AO OF THE SELLING PARTY COULD HAVE ALSO BEEN INFORMED ABO UT THE SALES MADE SO AS TO VERIFY IF THESE WERE REFLECTED IN THE TAX RET URN FILED. IN THIS VIEW OF THE MATTER THE LD. CIT(A) DELETED THE ADDITION. T HE REVENUE IS AGGRIEVED AGAINST THE DELETION OF ADDITION. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. THE LD. DR VEHEMENTLY CONTENDED THAT THE PRODUCTION OF COPY OF ACCOUNT PURCHASE BILL AND DH ARAM KANTA WEIGHING RECEIPTS ETC. WAS OF NO CONSEQUENCE. HE STATED THAT THE PROPRIETOR OF M/S SHREE SARASWATI STEEL CENTRE ADMI TTED DURING THE ITA NOS.5622 TO 5624/D/2013 CO NOS.35 TO 38/DEL/2015 6 COURSE OF SURVEY OPERATION U/S 133A OF THE ACT COND UCTED ON HIM THAT HE WAS RECEIVING COMMISSION OF 25 PAISE FOR EVERY R S.100/- FOR PROVIDING ENTRY FOR SALE OF GOODS. ON A SPECIFIC Q UERY THE LD. DR DID NOT PRODUCE A COPY OF THE ASSESSMENT ORDER PASSED I N THE CASE OF M/S SHREE SARASWATI STEEL CENTRE FOR ASCERTAINING THE F INAL FATE OF THE SURVEY CONDUCTED U/S 133A AS TO WHETHER THE CLAIM OF RECEI VING COMMISSION OF 25 PAISE FOR EVERY RS.100/- FOR ENTRY FOR THE SALE OF GOODS WAS FINALLY SUSTAINED OR NOT. IT IS NOTICED AS RECORDED BY TH E AO HIMSELF THAT VARIOUS AMRAPALI GROUP ENTITIES HAD RECORDED TRANSA CTIONS WITH M/S SHREE SARASWATI STEEL CENTRE AND THE PURCHASES MADE BY THESE COMPANIES FROM M/S SHREE SARASWATI STEEL CENTRE WER E TREATED AS BOGUS. THE LD. AR HAS PLACED ON RECORD A COPY OF THE ORDER PASSED BY THE TRIBUNAL IN M/S AMRAPALI GRAND ONE OF THE AMRAPALI GROUP OF ENTITIES IN WHICH SIMILAR ADDITION MADE ON ACCOUNT OF BOGUS PURCHASES FROM M/S SHREE SARASWATI STEEL CENTRE CAME TO BE DELETED. A COPY OF THIS ORDER DATED 23.11.2015 PASSED IN ITA NO.6205/DEL/2013 HAS BEEN PLACED ON RECORD. ON PERUSAL OF PARA 38 OF THE ORDER IT IS NOTICED THAT IN THAT CASE ITA NOS.5622 TO 5624/D/2013 CO NOS.35 TO 38/DEL/2015 7 ALSO THE LD. CIT(A) OBSERVED THAT THE RELEVANT PURC HASE BILLS FREIGHT BILLS AND DHARAM KANTA WEIGHING BILLS WERE PRODUCED BEFOR E THE AO BUT THE ADDITION WAS MADE ON ACCOUNT OF THE FAILURE OF THE ASSESSEE TO PRODUCE THE VENDOR. AT PARA 40 OF THE ORDER THE TRIBUNAL HAS AFFIRMED THE VIEW TAKEN BY THE LD. CIT(A) IN DELETING THE ADDITION BY OBSERVING AS UNDER:- 40. AT THE VERY OUTSET WE NOTE THAT THE CIT(A) HA S FOLLOWED PROPOSITION LAID DOWN BY HONBLE JURISDICTIONAL HIG H COURT (SUPRA) IN THE CASE OF SSP AVIATION LTD. VS DCIT. WE FURTHER O BSERVE THAT AFTER DETAILED DISCUSSION ON THE DOCUMENTARY EVIDENCE OF THE ASSESSEE THE LD. CIT(A) RIGHTLY NOTED THAT IN THE EVENTUALITY WH EN ASSESSEE FAILED TO PRODUCE ALLEGED VENDORS THE APPROPRIATE COURSE OF ACTION FOR A.O WAS TO INFORM VAT AUTHORITIES ABOUT THE TAX SAID TO BE DEDUCTED BY THE SELLERS SO THAT THE DEPOSIT OF VAT TAX COULD HA VE BEEN VERIFIED BY THEM. SIMULTANEOUSLY THE A.O OF THE VENDORS COULD HAVE ALSO BEEN INFORMED ABOUT THE SALES MADE AND TO VERIFY WHETHER THESE SALES HAD BEEN REFLECTED IN THEIR RESPECTIVE TAX RETURNS. THE LD. CIT(A) ALSO MENTIONS THAT THE A.O COULD ALSO HAVE INVESTIGATED BANK ACCOUNTS OF THE PARTIES (VENDORS) AVAILABLE WITH HIM AND NONE O F THESE COURSES HAVE BEEN TAKEN BY THE A.O. THE FIRST APPELLATE AUT HORITY RIGHTLY CONCLUDED THAT INSTEAD OF ADOPTING SAID AVAILABLE C OURSES THE A.O PROCEEDED TO MADE DISALLOWANCE AND ADDITION FOR NON -PRODUCTION OF VENDORS PARTIES AND ADVERSE INFERENCE DRAWN BY THE A.O WAS I.T.A. 6205 & CO 150/D/14 ASSESSMENT YEAR 2009-10 36 PRE-M ATURE AND WITHOUT ANY SOUND BASIS. THE LD. CIT(A) RIGHTLY CONCLUDED THAT U/S 153C OF THE ACT THE A.O CANNOT TRAVEL BEYOND T HE SATISFACTION RECORDED AND THE IMPUGNED ADDITION BASED ON ALLEGED BOGUS PURCHASES DOES NOT PERTAIN TO OR EMANATE FROM ALLEGATION OF S UPPRESSION OF SALES OR RECEIPT OF UNACCOUNTED CASH IN THE SALE OF FLATS . THIS VIEW ALSO FINDS SUPPORT FROM DICTA LAID DOWN BY HONBLE HIGH COURT OF DELHI IN THE CASE OF CIT VS MGF AUTOMOBILES LTD. (SUPRA) AND PR. CIT VS KURELE PAPER MILLS. P. LTD (SUPRA). ACCORDINGLY WE ARE UN ABLE TO SEE ANY PERVERSITY OR ANY OTHER VALID REASON TO INTERFERE W ITH THE IMPUGNED ITA NOS.5622 TO 5624/D/2013 CO NOS.35 TO 38/DEL/2015 8 ORDER AND THUS WE UPHOLD THE SAME ON THIS ISSUE OF ADDITIONS IN REGARD TO PURCHASES. ACCORDINGLY GROUND NO. 2 OF THE REVE NUE FAILS. 6. THE FACTS AND CIRCUMSTANCES OF THE INSTANT CASE ARE MUTATIS MUTANDIS SIMILAR TO THOSE CONSIDERED AND DECIDED BY THE T RIBUNAL IN THE CASE OF AMRAPALI GRAND (SUPRA). AS IT IS ONLY A QU ESTION OF FACT WHICH ALREADY STANDS DECIDED BY THE CO-ORDINATE BENCH WE EXPRESS OUR INABILITY TO THE LD. DR FROM REGISTERING ANY DEPART URE FROM THE SAME. RESPECTFULLY FOLLOWING THE PRECEDENT WE UPHOLD THE IMPUGNED ORDER ON THIS SCORE. 7. IN THE RESULT THE APPEAL IS DISMISSED. ASSESSMENT YEAR 2008-09 8. THE FIRST GROUND OF THE REVENUES APPEAL IS AGAI NST THE DELETION OF ADDITION ON ACCOUNT OF BOGUS PURCHASES OF RAW MATER IAL AMOUNTING TO RS.1 00 45 692/-. BOTH THE SIDES AGREE THAT THE FA CTS AND CIRCUMSTANCES OF THIS GROUND ARE SIMILAR TO THOSE OF ASSESSMENT Y EAR 2007-08. FOLLOWING THE VIEW TAKEN HEREINABOVE WE UPHOLD THE IMPUGNED ORDER IN DELETING THIS ADDITION. ITA NOS.5622 TO 5624/D/2013 CO NOS.35 TO 38/DEL/2015 9 9. THE ONLY OTHER GROUND IS AGAINST THE DELETION OF ADDITION OF RS.2 72 100/- ON ACCOUNT OF SALE OF SCRAP. THE FAC TS APROPOS THIS GROUND ARE THAT THE AO OBSERVED FROM THE PERUSAL OF PURCHA SES THAT THE ASSESSEE HAD CLAIMED TOTAL PURCHASES AT RS.8 30 01 37 318/- AFTER DEDUCTING THE SALE OF SCRAP AT RS.2 72 100/-. HE OPINED THAT SALE OF SCRAP IS AN ITEM OF INCOME WHICH SHOULD HAVE BEEN SEPARATELY REFLECTED ON THE CREDIT SIDE OF THE PROFIT & LOSS ACCOUNT AND NOT REDUCED FROM THE COST OF CONSTRUCTION/WORK-IN-PROGRESS. HE THEREFORE MADE ADDITION FOR THIS SUM WHICH CAME TO BE DELETED IN THE FIRST APPEAL. 10. AFTER CONSIDERING THE RIVAL SUBMISSIONS AND PER USING THE RELEVANT MATERIAL ON RECORD WE FIND THAT THE ASSESSEE SIMPL Y REDUCED SALE OF SCRAP AT RS.2 72 100/- FROM THE FIGURE OF PURCHASES . THERE WOULD HAVE BEEN NO CHANGE IN THE AMOUNT OF THE ULTIMATE PROFIT IF INSTEAD THE ASSESSEE WOULD HAD SHOWN SALE OF SCRAP AS A SEPARAT E ITEM OF INCOME. IN SUCH A SCENARIO THE FIGURE OF PURCHASES WOULD HAVE BEEN INCREASED TO THAT EXTENT. THERE BEING NO DIFFERENCE IN THE COMP UTATION OF TOTAL ITA NOS.5622 TO 5624/D/2013 CO NOS.35 TO 38/DEL/2015 10 INCOME IN SO FAR AS THE DEPICTION OF SALE OF SCRAP IS CONCERNED WE ARE SATISFIED THAT THE LD. CIT(A) WAS RIGHT IN DELETING THIS ADDITION. 11. IN THE RESULT THE APPEAL IS DISMISSED. ASSESSMENT YEAR 2009-10 12. THE FIRST ISSUE RAISED IN THIS APPEAL IS AGAINS T THE DELETION OF ADDITION OF RS.75 LAC ON ACCOUNT OF BOGUS PURCHASES OF RAW MATERIAL. BOTH THE SIDES ARE AD IDEM THAT THE FACTS AND CIRCUMSTANCES OF THIS GROUND ARE SIMILAR TO THOSE OF EARLIER YEARS. FOLL OWING THE VIEW TAKEN HEREINABOVE FOR THE ASSESSMENT YEARS 2007-08 AND 20 08-09 WE UPHOLD THE IMPUGNED ORDER IN DELETING THE ADDITION. 13. THE ONLY OTHER ISSUE IS AGAINST THE DELETION OF ADDITION OF RS.3 14 269/- ON ACCOUNT OF SALE OF SCRAP. HERE AG AIN THERE IS NO DISPUTE THAT THE FACTS AND CIRCUMSTANCES OF THIS GR OUND ARE SIMILAR TO THOSE OF THE GROUND TAKEN FOR THE ASSESSMENT YEAR 2 008-09. FOLLOWING THE VIEW TAKEN HEREINABOVE WE UPHOLD THE IMPUGNED ORDER. 14. IN THE RESULT THE APPEAL IS DISMISSED. ITA NOS.5622 TO 5624/D/2013 CO NOS.35 TO 38/DEL/2015 11 CROSS OBJECTIONS FOR A.YS. 2006-07 TO 2009-10 15. THE LD. AR DID NOT PRESS THE CROSS OBJECTIONS F OR THE AYS 2006-07 TO 2009-10. THE SAME ARE THEREFORE DISMISSED AS NOT PRESSED. 16. IN THE RESULT THE CROSS OBJECTIONS ARE DISMISS ED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 19.10.201 6. SD/- SD/- [SUCHITRA KAMBLE] [R.S. SYAL] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED 19 TH OCTOBER 2016. DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR ITAT AR ITAT NEW DELHI.