The ACIT, Mehsana Circle,, Mehsana v. Nimisha Khadi Gramoudyog Mandal,

ITSSA 176/AHD/2005 | misc
Pronouncement Date: 30-04-2015 | Result: Dismissed

Appeal Details

RSA Number 17620516 RSA 2005
Assessee PAN AAATN4908N
Bench Ahmedabad
Appeal Number ITSSA 176/AHD/2005
Duration Of Justice 9 year(s) 10 month(s) 19 day(s)
Appellant The ACIT, Mehsana Circle,, Mehsana
Respondent Nimisha Khadi Gramoudyog Mandal,
Appeal Type Income Tax (Search & Seizure) Appeal
Pronouncement Date 30-04-2015
Appeal Filed By Department
Order Result Dismissed
Bench Allotted A
Tribunal Order Date 30-04-2015
Date Of Final Hearing 27-04-2015
Next Hearing Date 27-04-2015
Assessment Year misc
Appeal Filed On 10-06-2005
Judgment Text
IT(SS)A NO.176/AHD/2005 BLOCK PERIOD ENDING: 02.12.1999 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD A BENCH AHMEDABAD [CORAM: PRAMOD KUMAR AM AND S.S. GODARA JM] IT(SS)A NO.176/AHD/2005 BLOCK PERIOD ENDING: 02.12.1999 ASSISTANT COMMISSIONER OF INCOMETAX ........... . .APPELLANT MEHSANA CIRCLE MEHSANA. VS. NIMISHA KHADI GRAMODYOG MANDAL .................. ....................RESPONDENT AT POST-JAMLA TA-KALOL DISTT. MEHSANA [PAN: AAATN 4908 N] APPEARANCES BY: P.M. PATEL FOR THE APPELLANT SUBHASH BAINS FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : APRIL 27 2015 DATE OF PRONOUNCING THE ORDER : APRIL 30 2015 O R D E R PER PRAMOD KUMAR AM: 1. BY WAY OF THIS APPEAL THE ASSESSING OFFICER HAS CHALLENGED CORRECTNESS OF THE ORDER DATED 29 TH MARCH 2005 PASSED BY THE CIT(A) IN THE MATTER OF ASSESSMENT UNDER SECTION 158BD READ WITH SECTION 14 3(3) OF THE INCOME TAX ACT 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR THE BLOCK PERIOD ENDING 2 ND DECEMBER 1999 ON THE FOLLOWING GROUNDS :-. 1. THE CIT(A) HAS ERRED IN LAW AND ON THE FACTS OF THE CASE IN DIRECTING THE ASSESSING OFFICER TO DELETE THE ADDIT ION MADE ON ACCOUNT OF UNDISCLOSED INCOME OF RS.2761500/-. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LEARNED CIT (APPEALS) OUGHT TO HAVE UPHELD THE ORDER OF THE ASS ESSING OFFICER. IT(SS)A NO.176/AHD/2005 BLOCK PERIOD ENDING: 02.12.1999 PAGE 2 OF 4 3. IT IS THEREFORE PRAYED THAT THE ORDER OF THE L EARNED CIT(APPEALS) MAY BE SET ASIDE AND THAT OF THE ASSES SING OFFICER BE RESTORED TO THE ABOVE EXTENT. 2. BRIEFLY STATED THE RELEVANT MATERIAL FACTS ARE AS FOLLOWS. THE ASSESSEE BEFORE US IS A PUBLIC TRUST SOCIETY ENGAGED IN THE BUSINESS OF RUNNING A CARPENTER UNIT AND DEALING IN WOODEN ITEMS SUCH AS FURNITURES DOOR AND WINDOWS ETC. A SEARCH AND SEIZURE OPERATION WAS CARRIED OUT IN TH E CASE OF TIMBER GROUP OF CASES ON 02.12.1999 AND CERTAIN INCRIMINATING DOCU MENTS WERE SEIZED INDICATING CASH RECEIPTS ON VARIOUS DATES DURING 1 997 AND 1998 FROM THE ASSESSEE. IT WAS IN THIS BACKDROP THAT THE ASSESSI NG OFFICER REQUIRED THE ASSESSEE TO SHOW CAUSE AS TO WHY THESE AMOUNTS BEIN G IN THE NATURE OF UNACCOUNTED RECEIPTS NOT BE ADDED TO THE INCOME OF THE ASSESSEE. ON RESPONSE TO THIS SHOW CAUSE NOTICE IT WAS EXPLAINED BY THE ASSESSEE THAT THE ASSESSEE WAS ONLY BUYING SOME MATERIALS FROM THESE CONCERNS AND AS SUCH THERE COULD NOT HAVE BEEN ANY OCCASION TO RECEIVE ANY MONEY FROM TH ESE CONCERNS. IT WAS ALSO EXPLAINED THAT THE ASSESSEE DID NOT RECEIVE ANY MON EY WHETHER IN CASH OR THROUGH BANKING CHANNELS FROM THESE CONCERNS. IT WAS ALSO EXPLAINED THAT THE ACCOUNTS OF THE ASSESSEE ARE DULY AUDITED AND THESE ACCOUNTS DO NOT REFLECT ANY RECEIPTS FROM THESE CONCERNS. IN ANY EVENT ACCORD ING TO THE ASSESSEE THERE WAS NO NEED FOR THE ASSESSEE TO SUPPRESS ANY RECEIPTS A S ENTIRE INCOME OF THE ASSESSEE TRUST IS EXEMPT FROM INCOME TAX UNDER SECT ION 10 (23B) OF THE ACT. 3. NONE OF THESE SUBMISSIONS HOWEVER IMPRESSED THE ASSESSING OFFICER. HE PROCEEDED TO TREAT THE AMOUNTS SHOWN IN THE SEIZED DOCUMENTS AS UNACCOUNTED RECEIPTS OF THE ASSESSEE AND ACCORDINGLY ADDED R S.27 61 500/- TO THE INCOME OF THE ASSESSEE. AGGRIEVED BY THE STAND SO TAKEN BY T HE ASSESSING OFFICER ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CIT(A) WHO DELETED THE IMPUGNED ADDITION BY OBSERVING AS FOLLOWS :- IT(SS)A NO.176/AHD/2005 BLOCK PERIOD ENDING: 02.12.1999 PAGE 3 OF 4 I HAVE CONSIDERED THE SUBMISSIONS OF THE APPELLANT AND PERUSED THE RELEVANT FACTS OF THE CASE. I AGREE WITH THE F ACT STATED BY THE APPELLANT THAT SHRI NITINBHAI PATEL FROM WHOM THE I NCRIMINATING PAPERS WERE SEIZED NEVER STATED IN HIS STATEMENT TH AT THE APPELLANT HAD BEEN PAID AMOUNTS IN CASH AS STATED IN THE SEIZ ED MATERIAL. FURTHER THE APPELLANT HAS NOT BEEN PROVIDED OPPORTU NITY OF CROSS EXAMINING SHRI NITINBHAI PATEL. THE DECISION OF HO NBLE AHMEDABAD TRIBUNAL IN THE CASE OF PRARTHNA CONSTRUCTION PVT. LTD. IS SQUARELY APPLICABLE IN THE CASE OF THE APPELLANT. FOLLOWING THE SAME I HOLD THAT AS IT IS NOT ESTABLISHED THAT THE APPELLANT HAD REC EIVED THE AMOUNT MENTIONED IN THE VARIOUS ENTRIES APPEARING IN THE P APER SEIZED FROM SHRI NITINBHAI PATEL I HOLD THAT THE AMOUNT OF RS.2 7 61 500/- CANNOT BE CONSIDERED UNDISCLOSED INCOME OF THE APPELLANT. HENCE THE ADDITION OF RS.27 61 500/- IS DELETED. 4. THE ASSESSING OFFICER IS AGGRIEVED OF THE RELIEF SO GRANTED BY THE CIT(A) AND IS IN APPEAL BEFORE US. 5. WE HAVE HEARD THE RIVAL CONTENTIONS PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF T HE APPLICABLE LEGAL POSITION. 6. AS LEARNED CIT(A) HAS RIGHTLY OBSERVED THE ISSU E AS TO WHETHER AN ADDITION CAN BE MADE ON THE BASIS OF SEIZED MATERIA L IN THE CASE OF AN ASSESSEE OTHER THAN THE ASSESSEE WHO HAS BEEN SUBJECTED TO S EARCH AND SEIZURE OPERATION AND IN A SITUATION WHEN HE HAD NO OPPORTUNITY TO CR OSS EXAMINE THE PERSON FROM WHOM THESE DOCUMENTS ARE SEIZED AND WHEN THERE ARE NO SUPPORTING EVIDENCES TO CORROBORATE THE CONTENTS OF THE SEIZED MATERIAL STANDS CONCLUDED IN FAVOUR OF THE ASSESSEE BY A CO-ORDINATE BENCH DECISION IN THE CASE OF PRARTHANA CONSTRUCTION PVT. LTD. VS. DCIT (70 TTJ 122). NO C ONTRARY DECISION HAS BEEN BROUGHT TO OUR NOTICE. LD. CIT (DR) HAS TRIED TO D EFEND THE ACTION OF THE ASSESSING OFFICER ON THE GROUND THAT THE PERSON WHO WAS SUBJECTED TO SEARCH OPERATION WAS NOT A RANK OUTSIDER AND ADMITTEDLY T HE ASSESSEE HAD BUSINESS DEALINGS WITH HIM. HOWEVER IN OUR HUMBLE UNDERSTA NDING THAT DOES NOT DILUTE THE RATIO OF THE DECISION IN THE CASE OF PRARTHANA CONSTRUCTION (SUPRA) OR ITS IT(SS)A NO.176/AHD/2005 BLOCK PERIOD ENDING: 02.12.1999 PAGE 4 OF 4 APPLICABILITY ON THE FACTS OF THIS CASE. IN THIS V IEW OF THE MATTER AND RESPECTFULLY FOLLOWING DECISION OF THE CO-ORDINATE BENCH IN THE CASE OF PRARTHANA CONSTRUCTION (SUPRA) WE APPROVE THE CONCLUSIONS AR RIVED AT BY THE CIT(A) AND DECLINE TO INTERFERE IN THE MATTER. 7. IN THE RESULT THE APPEAL IS DISMISSED. PRONOUN CED IN THE OPEN COURT TODAY ON THE 30 TH DAY OF APRIL 2015. SD/- SD/- S. S. GODARA PRAMOD KUM AR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) AHMEDABAD THE 30 TH DAY OF APRIL 2015 COPIES TO: (1) THE APPELLANT (2) THE RESPOND ENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ETC ASSISTANT/DEPUTY REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES AHMEDABAD