M/s Dhingra Exports,, Kurukshetra v. CIT, Karnal

ITA 682/CHANDI/2010 | 2005-2006
Pronouncement Date: 21-01-2011 | Result: Dismissed

Appeal Details

RSA Number 68221514 RSA 2010
Assessee PAN AACFD1706G
Bench Chandigarh
Appeal Number ITA 682/CHANDI/2010
Duration Of Justice 8 month(s)
Appellant M/s Dhingra Exports,, Kurukshetra
Respondent CIT, Karnal
Appeal Type Income Tax Appeal
Pronouncement Date 21-01-2011
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted SMC
Tribunal Order Date 21-01-2011
Date Of Final Hearing 20-01-2011
Next Hearing Date 20-01-2011
Assessment Year 2005-2006
Appeal Filed On 21-05-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL: SMC BENCH: CHANDIGARH BEFORE HONBLE SHRI D K SRIVASTAVA AM ITA NO. 682/CHANDI/2010 ASSESSMENT YEAR: 2005-06 M/S DHINGRA EXPORTS V COMMISSIONER OF INCOM E TAX LLADWA ROAD PIPLI KURUKSHETRA PAN: AACFD 1706 G (APPELLANT-ASSESSEE) (RESPONDENT) APPELLANT BY: NONE RESPONDENT BY: SHRI N.K. SAINI ORDER THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINS T THE ORDER PASSED BY THE LD. CIT ON 15.3.2010 U/S 263 OF INCOME-TAX ACT ON THE FOLLOWING GROUNDS: 1. ORDER PASSED BY THE LD. CIT IS ILLEGAL ARBITRA RY AND BAD IN LAW. 2 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE LD. CIT WAS NOT JUSTIFIED IN HOLDING THAT ORDER PASSED BY T HE AO IS ERRONEOUS AND PRE JUDICIAL TO THE INTEREST OF THE REVENUE. 3 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE LD. CIT WAS NOT JUSTIFIED IN PASSING THE ORDER U/S 263(1) O F INCOME-TAX ACT. 2. NOTICE OF HEARING WAS SENT BY REGISTERED POST FI XING THE APPEAL FOR HEARING ON 22.12.2010. THERE WAS NEITHER ANY APPEAR ANCE ON BEHALF OF THE ASSESSEE NOR WAS ANY ADJOURNMENT APPLICATION FILED FOR 22.12.2010. HEARING WAS ADJOURNED AND ACCORDINGLY FRESH NOTICE OF HEARI NG WAS SENT BY RPAD FIXING THE APPEAL FOR HEARING ON 6.1.2011. THERE WAS NO A PPEARANCE ON 6.1.2011 BY THE ASSESSEE. THIRD NOTICE OF HEARING WAS SENT BY RPAD FIXING THE APPEAL FOR HEARING ON 20.1.2011. THE ASSESSEE HAS NOT COMPLIED WITH THE AFORESAID NOTICE. IN VIEW OF PERSISTENT NON-APPEARANCE ON BEH ALF OF THE ASSESSEE THE APPEAL FIELD BY THE ASSESSEE IS BEING DISPOSED OFF EX-PARTE QUA THE ASSESSEE AFTER HEARING THE LD. DR. 3. RETURN OF INCOME WAS FILED BY THE ASSESSEE ON 18 .10.2005 DECLARING THE TOTAL INCOME AT RS. 1 45 500/-. THE ASSESSEE IS ENG AGED IN THE BUSINESS OF CONVERSION OF RICE FROM PADDY. THE RETURN FILED BY THE ASSESSEE WAS TAKEN UP DHINGRA EXPORTS 682/CHANDI/2010 2 2 FOR SCRUTINY AND CONSEQUENTLY ASSESSMENT U/S 143(3) WAS COMPLETED ON 1.6.2007 ASSESSING THE TOTAL INCOME AT RS. 2 07 540 /- AFTER DISALLOWING RS. 12 035/- OUT OF TOTAL EXPENSES AND ADDING RS. 15 00 0/- ON ACCOUNT OF LOW YIELD OF RICE. THE LD. CIT CALLED FOR THE RECORDS EXAMIN ED THEM AND THEREAFTER FORMED PRIMA FACIE BELIEF THAT THE ASSESSMENT ORDER PASSED BY THE AO WAS ERRONEOUS AND PRE JUDICIAL TO THE INTEREST OF THE R EVENUE. HE THEREFORE ISSUED A SHOW CAUSE NOTICE CALLING UPON THE ASSESSE E TO EXPLAIN AS TO WHY THE SAID ASSESSMENT ORDER SHOULD NOT BE REVISED. AFTER HEARING THE ASSESSEE THE LD. CIT HAS PASSED THE IMPUGNED ORDER SETTING ASIDE THE ASSESSMENT ORDER PASSED BY THE AO ON 1.6.2007 AND RESTORING THE MATT ER TO THE FILE OF AO FOR PASSING A FRESH ASSESSMENT ORDER. IT IS AGAINST THE ORDER PASSED BY THE LD. CIT THAT THE ASSESSEE HAS FILED THE PRESENT APPEAL. AS STATED EARLIER THE ASSESSEE HAS NEITHER ENTERED APPEARANCE NOR FILED ANY APPLIC ATION FOR ADJOURNMENT BEFORE THIS TRIBUNAL. IT SEEMS THAT THE ASSESSEE IS NOT INTERESTED TO PURSUE THE APPEAL. THE LD. DR SUPPORTED THE ORDER PASSED BY TH E LD. CIT. 4. I HAVE HEARD THE LD. DR AND PERUSED THE ASSESSME NT ORDER AND THE ORDER PASSED BY THE LD. CIT. THE LD. CIT HAS CONSID ERED THE ASSESSMENT ORDER PASSED BY THE AO AS ERRONEOUS AND PRE JUDICIAL TO T HE INTEREST OF REVENUE ON THREE COUNTS NAMELY (I) IN THE ABSENCE OF NON-MAI NTENANCE OF MANUFACTURING ACCOUNTS ON DAY-TO-DAY BASIS THE PRODUCTION FIGURE S GIVEN BY THE ASSESSEE WERE NOT RELIABLE AND VERIFIABLE AND THEREFORE THE BOOK RESULTS OUGHT TO HAVE BEEN REJECTED U/S 145 BY THE AO (II) THE ASSESSEE HAS SECURED SUBSTANTIAL AMOUNT OF UNSECURED LOANS FROM VARIOUS PARTIES BUT THE AO HAS NOT CONSIDERED THE NATURE AND SOURCE OF THE AFORESAID LOANS AS REQ UIRED BY SECTION 68 AND (III) THE ASSESSEE HAS MADE PURCHASES AT HIGHER RATES FRO M ASSOCIATE CONCERNS BUT THE AO HAS NOT EXAMINED THE MATTER IN THE LIGHT OF THE PROVISIONS OF SECTION 40A(2) OF INCOME-TAX ACT. 5. PERUSAL OF THE ASSESSMENT ORDER SHOWS THAT THE A O HAS NOT EXAMINED ANY OF THE ISSUES WHICH IN THE OPINION OF THE LD. CIT HAS RENDERED THE ASSESSMENT ERRONEOUS AND PREJUDICIAL TO THE INTERES T OF REVENUE. IN THE ABSENCE OF ANY DISCUSSION ON THE AFORESAID THREE IS SUES IN THE ASSESSMENT ORDER IT IS QUITE OBVIOUS THAT THE AO HAS PASSED T HE ORDER MECHANICALLY AND WITHOUT APPLICATION OF MIND. NO MATERIAL HAS BEEN P LACED BEFORE ME TO SHOW DHINGRA EXPORTS 682/CHANDI/2010 3 3 THAT THE AO HAS AT ALL MADE ANY INQUIRY INTO ANY OF THE AFORESAID THREE ISSUES. IT IS WELL ESTABLISHED THAT THE ASSESSMENT ORDER PA SSED MECHANICALLY AND WITHOUT APPLICATION OF MIND RENDERS THE SAME AS ERR ONEOUS AND PRE JUDICIAL TO THE INTEREST OF REVENUE. IN THIS VIEW OF THE MATTER THE IMPUGNED ORDER PASSED BY THE LD. CIT IS CONFIRMED. APPEAL FILED BY THE A SSESSEE IS DISMISSED. ORDER PRONOUNCED ON 21 ST JANUARY 2011 (D K SRIVASTAVA) ACCOUNTANT MEMBER CHANDIGARH THE 21 ST JANUARY 2011 SURESH COPY TO: 1. THE APPELLANT M/S DHINGRA EXPORTS PIPLI KURUK SHETRA 2. THE RESPONDENT CIT KARNAL 3. THE CIT(A) KARNAL 4. THE DR INCOME-TAX DEPARTMENT CHANDIGARH TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT CHANDIGARH