M/s Lavanya Industries, Hyderabad v. DCIT, Karimnagar

ITSSA 29/HYD/2006 | misc
Pronouncement Date: 21-05-2010 | Result: Allowed

Appeal Details

RSA Number 2922516 RSA 2006
Assessee PAN AAAFL5219J
Bench Hyderabad
Appeal Number ITSSA 29/HYD/2006
Duration Of Justice 4 year(s) 23 day(s)
Appellant M/s Lavanya Industries, Hyderabad
Respondent DCIT, Karimnagar
Appeal Type Income Tax (Search & Seizure) Appeal
Pronouncement Date 21-05-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted B
Tribunal Order Date 21-05-2010
Date Of Final Hearing 26-04-2010
Next Hearing Date 26-04-2010
Assessment Year misc
Appeal Filed On 28-04-2006
Judgment Text
IT(SS) A NO.29/HYD/06 LAVANYA INDUSTRIES HYD. 1 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B HYDERABAD BEFORE SHRI G.C. GUPTA VICE PRESIDENT AND SHRI AKBER BASHA ACCOUNTANT MEMBER IT(SS)A NO.29/HYD/06 : BLOCK ASST. YR.1 989-90 TO 1999- 2000 M/S. LAVANYA INDUSTRIES KARIMNAGAR. (PAN - AAAFL5219J) VS ACIT CENT. CIR-1 KARIMAGAR. (APPELLANT) (RESPONDENT) APPELLANT BY : S/SRI K. VASANT KUMAR & A.V. RAGHU RAM RESPONDENT BY : SMT. NIVEDITA BISWAS O R D E R PER AKBER BASHA ACCOUNTANT MEMBER: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDE R OF THE CIT (A) TIRUPATHI DATED 31-1-2006 PERTAINING T O THE BLOCK PERIOD 1989-90 TO 1999-2000. 2. GROUND RAISED BY THE ASSESSEE READS AS FOLLOWS:- 1. THE ORDERS OF THE CIT (A) TIRUPATHI IS WRONG IN L AW AND ON FACTS OF THE CASE. 2. THE CIT(A) ERRED IN CONFIRMING THE ADDITION MADE BY THE ASSESSING OFFICER AMOUNTING TO RS.8 28 741 AS UNDISCLOSED PROFITS BY COMPARING THE PARALLEL BOOK RESULTS AND INCOM ES DECLARED IN THE REGULAR RETURNS. IT(SS) A NO.29/HYD/06 LAVANYA INDUSTRIES HYD. 2 3. THE CIT (A) ERRED IN ACCEPTING THE APPELLANT'S PLE A STATING THAT THERE IS STILL TIME TO FILE THE REGULAR RETURN O F INCOME AS DATE OF SEARCH TOOK PLACE ON 9-3-1999. IN VIEW OF THE AFORESAID GROUNDS AND ANY OTHER GROUN DS TO BE PUT FORTH BY THE APPELLANTS AT THE TIME OF APPEAL PROCEEDINGS AND REQUESTS THAT THE ADDITION BE DELETED O R TO PASS SUITABLE ORDERS IN THE MATTER.' 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A FIRM WHICH IS A PART OF OMKAR GROUP WHERE A SEARCH AND SEIZURE OPE RATION WAS CONDUCTED ON 9-3-1999. A PARALLEL SET OF BOOKS OF ACCOUN TS AND LOOSE SHEETS WERE SEIZED RELATING TO THE ASSESSEE FIRM WHICH CONTA INED TRANSACTIONS DIFFERENT THAT OF THE REGULAR BOOKS OF AC COUNTS. AS MENTIONED BY THE ASSESSING OFFICER THE ENTIRE ACTUAL INCO ME AND EXPENDITURE WERE RECORDED IN THE PARALLEL SET OF BOOK S OF ACCOUNTS. SRI A. KUMARASWAMY MANAGING PARTNER OF THE ASSESSEE FIRM WA S EXAMINED UNDER OATH ON 25-5-1999 WHO ADMITTED THAT PROFITS TO THE TUNE OF RS.25 40 930 WAS SUPPRESSED. SRI KUMARASWSWAMY'S AN SWER TO QUESTION NO.3 WHICH WAS NOTED BY THE ASSESSING OFFICER A ND WHICH IS VITAL TO THE ISSUE BEFORE HIS WAS EXTRACTED AT PAGE-2 A ND PARA OF HIS ORDER. THE ASSESSING OFFICER ACCORDINGLY COMPUTED UNDISCLOSE D INCOME AT RS.24 49 913 BY REDUCING LOSS OF RS.91 107 FROM DIFFE RENCE OF RS.25 41 020 SINCE LOSS OF RS.91 107 WAS UNDISCLOSED LOSS FOR T HE PERIOD 1-4-1998 TO 9-3-99 AS PER PARALLEL SET OF BOOK WHEREAS UNDISCLOSED INCOME AS PER PARALLEL SET OF BOOKS OF ACCOUNT S BEING IN EXCESS OVER REGULAR BOOKS WAS RS.25 41 020 FOR THE PERIOD 1-6-1996 TO 31-3-1998 WHEREAS THE UNDISCLOSED INCOME AS PER THE ASSESSEE IS RS.16 21 172. AS CONTENDED BY THE ASSESSEE THE ASSESSING OF FICER WITHOUT CONSIDERING THE REPLY FILED BY THE ASSESSEE IN R ESPONSE TO THE IT(SS) A NO.29/HYD/06 LAVANYA INDUSTRIES HYD. 3 NOTICE AND WITHOUT ARRIVING THE CORRECT DIFFERENCE OF P ROFIT BETWEEN THE RETURNED INCOME AND AS PER SECOND SET OF BOOKS MADE AN A DDITION OF RS.8 28 741 AS UNDISCLOSED INCOME WHICH WAS NOT DISCLOSED IN THE BLOCK RETURN. AGGRIEVED BY THE DECISION OF THE ASSESSING O FFICER THE ASSESSEE WENT IN APPEAL BEFORE THE CIT (A). ON APPEAL THE CIT (A) HELD THAT AFTER CONSIDERING THE FACTS AND THE CIRCUMSTANCES OF THE CASE HE CONFIRMED THE ACTION OF THE ASSESSING OFFICER AND DISMI SSED THE APPEAL FILED BY THE ASSESSEE. 4. AGGRIEVED BY THE FINDINGS AND THE DECISION OF THE CIT (A) THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. THE LEARNE D COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE CIT (A) IS WRONG IN LAW AND ON FACTS OF THE CASE AND THE CIT (A) FURTHER ERRED IN CONFIRMING THE A DDITION MADE BY THE ASSESSING OFFICER AMOUNTING TO RS.8 28 741 AS UNDISCLOSE D PROFITS BY COMPARING THE PARALLEL BOOK RESULTS AND INCOMES DECLAR ED IN THE REGULAR RETURNS. THE LEARNED COUNSEL FOR THE ASSESSEE FUR THER SUBMITTED THAT THE CIT (A) ERRED IN NOT ACCEPTING THE ASSESSEE'S PLEA STATING THAT THERE IS STILL TIME TO FILE THE REGULAR R ETURN OF INCOME AS DATE OF SEARCH TOOK PLACE ON 9-3-1999. THE LEARNED COUN SEL FURTHER SUBMITTED THAT THE UNDISCLOSED INCOME COMPUTED BY THE ASSE SSING OFFICER IS RS.24 49 910 WHEREAS UNDISCLOSED INCOME ARRIVED AT BY THE ASSESSEE IS RS.16 21 172. THERE IS A DIFFERENCE OF RS.8 28 741 AND THE CIT(A) ERRED IN CONFIRMING THE ADDITION MADE BY THE ASSESSING OFFICER AMOUNTING TO RS.8 28 741 AS UNDISCLOSED INCOME O F THE ASSESSEE. IT IS CONTENDED BY THE LEARNED COUNSEL FOR THE ASSE SSEE THAT FOR THE ASSESSMENT YEAR 1999 UP TO THE DATE OF SURVEY THE PARALLEL BOOKS OF ACCOUNTS SHOWN A LOSS OF RS.91 107. AS PER THE REG ULAR BOOKS OF ACCOUNTS FOR THE ASSESSMENT YEAR 1999-2000 THE ASSESSE E HAS FILED A REGULAR RETURN OF INCOME DECLARING A NET I NCOME OF IT(SS) A NO.29/HYD/06 LAVANYA INDUSTRIES HYD. 4 RS.11 13 494 WITHOUT TAKING INTO CONSIDERATION THE LO SS ARRIVED AS PER THE PARALLEL BOOKS OF ACCOUNTS. BUT THE ASSESSING OFFICER WITHOUT TAKING INTO CONSIDERATION THE ABOVE FACTS AND FIGURES ON THE BASIS OF PRESUMPTION AND ON THE STATEMENTS GIVEN BEFORE THE ADI MADE AN UNDISCLOSED INCOME BY THE ASSESSING OFFICER AT RS.24 49 910 WHICH IS AGAINST THE NATURAL JUSTICE AND NOT WARRANTED. 5. ON THE OTHER HAND THE LEARNED DEPARTMENTAL REPR ESENTATIVE WHILE SUPPORTING THE ORDERS OF THE AUTHORITIES BELOW SU BMITTED THAT THIS MATTER REQUIRES RECONCILIATION OF THE AMOUNTS ARRIV ED BY THE ASSESSEE AS WELL AS BY THE ASSESSING OFFICER. HENCE THIS MATTER MAY BE RESTORED BACK TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO RECONCILE THE DIFFERENCE BETWEEN THE UNDISCLOSED INCOME A RRIVED BY THE ASSESSEE AS AGAINST THE UNDISCLOSED INCOME ARRIVED AT BY T HE ASSESSING OFFICER. 6. WE HAVE CONSIDERED THE SUBMISSIONS OF THE RIVAL PAR TIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. AFTER CONSID ERING THE FACTS AND THE CIRCUMSTANCES OF THE CASE WE FEEL IT PROPER AND JUST TO SEND BACK THE MATTER TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO RECONCILE THE DIFFERENCE BETWEEN THE UNDISCLOSED INCOME COM PUTED BY THE ASSESSING OFFICER AND THE UNDISCLOSED INCOME ARRIVED AT BY THE ASSESSEE AFTER AFFORDING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN THIS REGARD. IT(SS) A NO.29/HYD/06 LAVANYA INDUSTRIES HYD. 5 7. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS T REATED AS ALLOWED FOR STATISTICAL PURPOSE. ORDER WAS PRONOUNCED IN THE COURT ON 21-5-2010. SD/- G.C.GUPTA SD/- AKBER BASHA VICE PRESIDENT ACCOUNTANT MEMBER. DT/- 21ST MAY 2010 COPY FORWARDED TO: 1. SRI N. NAGARAJU NSR ANAJANEYULU & CO. ADVOCATE & TAX CONSULTANTS FLAT NO.12 MANOHAR APARTMENTS VIDYAN AGAR HYDERABAD. 2 DCIT CIRCLE-! HYDERABAD. 3. 4. THE CIT AP HYDERABAD. CIT(A) TIRUPATHI. DR ITAT HYDERABAD. JMR *