ACIT Rg. - 18(2), MUMBAI v. M/s. SUSHIL & CO., MUMBAI

ITSSA 152/MUM/2007 | misc
Pronouncement Date: 20-04-2010 | Result: Dismissed

Appeal Details

RSA Number 15219916 RSA 2007
Assessee PAN AAAFS5332D
Bench Mumbai
Appeal Number ITSSA 152/MUM/2007
Duration Of Justice 2 year(s) 4 month(s) 13 day(s)
Appellant ACIT Rg. - 18(2), MUMBAI
Respondent M/s. SUSHIL & CO., MUMBAI
Appeal Type Income Tax (Search & Seizure) Appeal
Pronouncement Date 20-04-2010
Appeal Filed By Department
Order Result Dismissed
Bench Allotted J
Tribunal Order Date 20-04-2010
Date Of Final Hearing 09-04-2010
Next Hearing Date 09-04-2010
Assessment Year misc
Appeal Filed On 07-12-2007
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH J : MUMBAI BEFORE SHRI D.K. AGARWAL (JM) AND SHRI PRAMOD KUMAR ( AM ) IT (SS) A NO. 152/MUM/2007 ASSESSMENT YEAR : BLOCK PERIOD 1.4.1989 TO 30.07.1999 ASSTT. COMMISSIONER OF INCOME TAX RANGE 18(2) ROOM NO.115 1 ST FLOOR PIRAMAL CHAMBERS PAREL MUMBAI - 400 0 12 . ..( APPELLANT ) VS. M/S. SUSHIL & CO. 14 - A BHAVANI COMPLEX BHAVANI SHANKAR ROAD DADAR(W) MUMBAI - 400 0 28 . ..( RESPONDENT ) P.A. NO. ( AAAFS 5332 D ) APPELLANT BY : SHRI N.K. BALODIA RESPONDENT BY : SHRI MANISH SANGHVI O R D E R PER D.K. AGARWAL (JM). THIS APPEAL PREFERRED BY THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 20.9.2007 PASSED BY THE LD. CIT(A) FOR THE ASSESSMENT YEAR PERTAINING TO BLOCK PERIOD 1.4.1989 TO 30.7.1999. 2. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE ASSESSEE FIRM IS ENGAGED IN THE BUSINESS OF MANUFACTURING AND TRADING OF READYMADE GARMENTS. A SEARCH AND SEIZURE ACTION U/S.132(1) OF THE I NCOME T AX ACT 1961(THE ACT) WAS CARRIED OUT AT THE BUSINESS AND RESIDENTIAL PREMISES OF CAMBRIDGE GR OUP OF CASE S COMPRISING OF VARIOUS FIRMS IT (SS) A NO. 152/M/07 A.Y: BP 2 INDIVIDUALS HUFS ETC ON 30.07.1999. THE ASSESSEE FIRM IS ONE OF THE GROUP CONCERNS. DURING THE COURSE OF SEARCH A STATEMENT OF ONE OF THE PARTNERS WAS RECORDED IN WHICH HE DISCLOSED UNACCOUNTED INCOME PERTAINING TO INFLATION OF PURCHASES AND MAKING CHARGES TO THE EXTENT OF RS.42.00 LACS IN RELATION TO THIS FIRM. THIS WAS PART OF THE OVERALL UNDISCLOSED INCOME OF RS.4.50 CRORES CONCERNING 13 DIFFERENT BUSINESS ENTITIES OF THIS GROUP. AN ORDER U/S.158BC OF THE AC T WAS PASSED ON 30.7.2001 DETERMINING THE UNDISCLOSED INCOME AT RS.1 58 89 915/ - AS AGAINST RETURNED INCOME OF RS.6.00 LACS. THE ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A). THE LD. CIT(A) VIDE ORDER DATED 17.10.2003 GRANTED RELIEF OF RS.1 22 89 915/ - . THE ASSESSEE AND DEPARTMENT BOTH PREFERRED SECOND APPEAL BEFORE THE TRIBUNAL. THE TRIBUNAL WHILE DISMISSING THE REVENUE S APPEAL SET ASIDE THE ISSUE OF THE ADDITION FOR THE PERIOD AFTER 1.4.1997 TO THE AO WITH THE DIRECTION TO MAKE ENQUIRIES FROM THE RESP ECTIVE PARTIES FROM WHOM THE SALES HAVE BEEN MADE AND THEN PASS A FRESH ORDER AFTER AFFORDING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THEREAFTER THE ASSESSEE WAS ASKED TO PRODUCE THE PARTIES FROM WHOM THE PURCHASES WERE MADE. NOTICES U/S.133(6) WERE ALSO ISSUED TO VARIOUS PARTIES. SOME OF THE PARTIES RESPONDED HOWEVER SOME OF THEM DID NOT RESPOND AND THE SUMMONS ISSUED TO THEM WERE RETURNED UN - SERVED. THE AO WAS NOT SATISFIED WITH THE CONFIRMATIONS AND BY OBSERVING THAT MAJOR PARTIES HAVE NOT RESP ONDED IT (SS) A NO. 152/M/07 A.Y: BP 3 MADE THE ADDITION ON ACCOUNT OF INFLATED PURCHASES RS.11.00 LACS AND ON ACCOUNT OF INFLATED MAKING CHARGES RS.9.00 LACS AGGREGATING TO RS.20.00 LACS AND THEREBY COMPLETED THE ASSESSMENT AT AN UNDISCLOSED INCOME OF RS.26.00 LACS VIDE ORDER DATED 29. 12.2006 PASSED U/S.158 BC R.W.S. 254 OF THE ACT. ON APPEAL THE LD. CIT(A) OBSERVED THAT THE FAILURE TO ATTEND ON THE PART OF A THIRD PARTY SHOULD NOT CAUSE ANY DISADVANTAGE TO THE APPELLANT . H E FURTHER OBSERVED THAT UNDER C HAPTER XIV B THE UNDISCLOSED I NCOME HAS TO BE WORKED OUT ONLY ON THE BASIS OF EVIDENCE FOUND AS A RESULT OF SEARCH OR REQUISITION OF BOOKS OF ACCOUNT OR DOCUMENTS AND SUCH OTHER MATERIAL OR INFORMATION AS ARE AVAILABLE WITH THE AO . HE HELD THAT THE ADDITION OF RS.20.00 LACS MADE BY THE AO IS BASED UPON UNSUBSTANTIATED STATEMENT OF THE APPELLANT WHICH COULD NOT BE CORROBORATED WITH ANY OTHER EVIDENCE DELETED THE ADDITION OF RS.20.00 LACS MADE BY THE AO. 3. BEING AGGRIEVED BY THE ORDER OF THE LD. CITA) THE REVENUE IS IN APPEAL BEFORE U S CHALLENGING IN ALL THE GROUNDS THE DELETION OF ADDITION OF RS.20.00 LACS MADE BY THE AO. 4. AT THE TIME OF HEARING THE LD. DR SUBMITS THAT FOR THE REASONS AS MENTIONED IN THE ASSESSMENT ORDER AND THE PLEA TAKEN IN THE GROUNDS OF APPEAL THE LD. CIT(A) W AS NOT JUSTIFIED IN DELETING THE ADDITION MADE BY THE AO. IT (SS) A NO. 152/M/07 A.Y: BP 4 5. ON THE OTHER HAND THE LD. COUNSEL FOR THE ASSESSEE AT THE OUTSET SUBMITS THAT THE FACTS OF THE PRESENT CASE ARE SIMILAR TO THE FACTS OF THE GROUP CASE OF CAMBRIDGE GROUP WHEREIN THE TRIBUNAL I N ACIT VS. M/S. CAM ENTERPRISES IN IT (SS) A NO.277/MUM/06 FOR THE BLOCK PERIOD 1.4.89 TO 30.7.1999 DATED 28.11.2008 HAS CONFIRMED THE ORDER PASSED BY THE LD. CIT(A) AND DISMISSED THE REVENUE S APPEAL. HE ALSO PLACED ON RECORD THE COPY OF THE SAID ORDER OF THE TRIBUNAL. H E THEREFORE SUBMITS THAT THE ORDER PASSED BY THE LD. CIT(A) IN DELETING THE ADDITION BE UPHELD. 6. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE RIVAL PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE FACTS ARE N OT IN DISPUTE INASMUCH AS IT IS ALSO NOT IN DISPUTE THAT THE FACTS OF THE PRESENT CASE ARE SIMILAR TO THE FACTS OF THE CASE IN M/S. CAM ENTERPRISES (SUPRA) WHEREIN THE TRIBUNAL HAS HELD THAT THE PURCHASES AND LABOUR CHARGES WERE DISCLOSED IN THE REGULAR B OOKS OF ACCOUNT THEREFORE THERE WAS NO SCOPE FOR MAKING ANY ADDITION IN THE BLOCK ASSESSMENT VIDE FINDING RECORDED IN PARA - 5 OF ITS ORDER DATED 28.11.2008 AS UNDER : 5 AFTER CONSIDERING THE ORDERS OF THE AUTHORITIES BELOW WE DO NOT FIND ANY INFIRMITY IN THE FINDINGS OF THE LD CIT(A). THE LD CIT(A) HAS GIVEN A FINDING OF FACT THAT ALL THE PURCHASES MADE FROM VARIOUS PARTIES WERE RECORDED IN THE REGULAR BOOKS OF ACCOUNT AND NOTHING HAS BEEN IT (SS) A NO. 152/M/07 A.Y: BP 5 BROUGHT ON RECORD TO ESTABLISH THAT THE PURCHASES MADE WERE INFL ATED PURCHASES OR THE LABOUR CHARGES CLAIMED WERE INFLATED. THE TRIBUNAL HAS GIVEN A FINDING THAT IF ANY MATERIAL BROUGHT ON RECORD TO ESTABLISH THAT PURCHASES WERE INFLATED THEN TO THAT EXTENT THE ADDITION CAN BE MADE. AS STATED NOTHING HAS BEEN BROUGHT ON RECORD TO ESTABLISH THIS FACT. AS THE PURCHASES AND LABOUR CHARGES WERE DISCLOSED IN THE REGULAR BOOKS OF ACCOUNT THEREFORE THERE WAS NO SCOPE FOR MAKING ANY ADDITION IN THE BLOCK ASSESSMENT. ACCORDINGLY WE HOLD THAT THE LD CIT(A) WAS JUSTIFIED IN DE LETING THE ADDITION. ACCORDINGLY THE ORDER OF THE LD CIT(A) IS CONFIRMED. IN THE ABSENCE OF ANY DISTINGUISHING FEATURE BROUGHT ON RECORD BY THE REVENUE AND KEEPING IN VIEW THAT THE REVENUE HAS FAILED TO BRING ANY MATERIAL ON RECORD TO ESTABLISH THAT T HE PURCHASES AND MAKING CHARGES WERE ACTUALLY INFLATED WE RESPECTFULLY FOLLOWING THE DECISION OF THE TRIBUNAL SUPRA UPHOLD THE ORDER OF THE LD. CIT(A) IN DELETING THE ADDITION OF RS.20.00 LACS MADE BY THE AO AND ACCORDINGLY THE GROUNDS TAKEN BY THE REVE NUE ARE REJECTED. 7. IN THE RESULT THE REVENUE S APPEAL STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 20.4.2010. SD/ - SD/ - ( PRAMOD KUMAR ) ( D.K. AGARWAL ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI DATED: 20.4. 20 10 . JV. IT (SS) A NO. 152/M/07 A.Y: BP 6 COPY TO: THE APPELLANT THE RESPONDENT THE CIT CONCERNED MUMBAI THE CIT(A) CONCERNED MUMBAI THE DR BENCH TRUE COPY BY ORDER DY/ASSTT. REGISTRAR ITAT MUMBAI.