M/s. Dattani & Co.,, JAMNAGAR v. The Income Tax Officer, Ward-1(1),, JAMNAGAR

MA 18/RJT/2013 | 2002-2003
Pronouncement Date: 31-07-2013 | Result: Dismissed

Appeal Details

RSA Number 1824924 RSA 2013
Assessee PAN AABFD4165G
Bench Rajkot
Appeal Number MA 18/RJT/2013
Duration Of Justice 2 month(s) 17 day(s)
Appellant M/s. Dattani & Co.,, JAMNAGAR
Respondent The Income Tax Officer, Ward-1(1),, JAMNAGAR
Appeal Type Miscellaneous Application
Pronouncement Date 31-07-2013
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted DB
Tribunal Order Date 31-07-2013
Date Of Final Hearing 11-06-2013
Next Hearing Date 11-06-2013
Assessment Year 2002-2003
Appeal Filed On 13-05-2013
Judgment Text
IN THE INCOME TAX APPELLATE TRIBULAL: RAJKOT BENCH: RAJKOT BEFORE SHRI T K SHARMA JM AND SHRI D K SRIVASTAVA AM M. A . NO S . 18 TO 21 /RJ T/2013 (ARIS I N G OUT OF ORDER IN ITA NO S . 1249 TO 1252 /RJT/201 0 ) ASSESSMENT YEAR S: 200 2 - 0 3 2004 - 05 2005 - 06 & 2006 - 07 M /S DATTANI & CO. V. ITO WARD - 1( 1 ) JAMNAGAR JODHPUR GATE JAM - KHAMBHALIA JAMNAGAR PAN: AABFD 4165 G DATE OF HEARING : 11 .0 6 .2013 DATE OF PRONOUNCEMENT : 31 . 0 7 . 2013 FOR THE APPLICANT - ASSESSEE: SHRI VIMAL DESAI CA FOR THE REVENUE : SHRI K C MATHEWS DR ORDER D K SRIVASTAVA : THE SE FOUR MISCELLANEOUS APPLICATIONS FILED BY THE ASSESSEE ARIS E OUT OF THE COMMON ORDER PASSED BY THIS TRIBUNAL ON 22.03 .2013 IN APPEAL S FILED BY THE ASSESSEE BEARING ITA NOS. 1249 TO 1252/RJT/2010 . 2. MISCELLANEOUS APPLICATION NO. 18/RJT/2013 FILED BY THE ASSESSEE READS AS UNDER: - THIS MISCELLANEOUS APPLICATION ARISES OUT OF DECISION RENDERED ON 22.03.2013 (COPY ENCLOSED) BY THE HONBLE ITAT IN THE CASE OF M/S. DATTANI & CO. VS. ITO WARD - 1(1) JA MNAGAR IN ITA NO.1249/RJT/2010. WE MOST RESPECTFULLY SUBMIT THAT THERE ARE CERTAIN ERRORS IN RESPECT OF TWO ISSUES INVOLVED IN THE AFORESAID APPEAL AND DECIDED VIDE ABOVE MENTIONED ITAT ORDER. THE SAME ARE EXPLAINED HEREUNDER: 1 . RE. : ADDITION OF RS.4 70 0 00/ - ON ACCOUNT OF ALLEGED PURCHASES: - IN THE PROCEEDINGS BEFORE ADIT SEVEN PARTIES WERE INVOLVED. THE APPELLANT SHOWED PURCHASED FROM TWO PARTIES IN THE BOOKS OF ACCOUNTS WHICH WERE ACCEPTED. THE DISPUTE WAS IN RESPECT OF REMAINING FIVE PARTIES. IN TH E REASSESSMENT PROCEEDINGS TWO PARTIES SENT REPLY TO THE A.O. STATING THAT THEY HAD SOLD GOODS TO THE APPELLANT. THERE WAS NO REPLY FROM REMAINING THREE PARTIES IN SPITE OF SENDING NOTICE. 2 MA 18 TO 21 - RJT - 2013 DATTANI & CO. IN RESPECT OF REPLIES FROM TWO PARTIES THE APPELLANT SUBMITTED T HAT COPY OF THEIR REPLIES WAS NOT GRANTED TO THE APPELLANT FOR REBUTTAL. HENCE IT WAS SUBMITTED THAT THE ADDITION WAS MADE IN VIOLATION OF PRINCIPLES OF NATURAL JUSTICE. THE HONBLE ITAT IN PARA 13 OF THE APPELLANT ORDER CONFIRMED THE ADDITION ON THE GRO UND THAT THE APPELLANT HAD AMPLE OPPORTUNITIES BEFORE THE A.O./CIT(A) TO REBUT THE MATERIAL GATHERED BY THE INVESTIGATION WING. IT IS SUBMITTED THAT WHEN A COPY FO SUCH MATERIAL IS NOT PROVIDED TO THE APPELLANT THE QUESTION OF THEIR REBUTTAL BY THE APPEL LANT DOES NOT ARISE AT ALL. THIS VITAL FACT APPEARS TO HAVE ESCAPED THE ATTENTION OF THE HONBLE ITAT. FURTHER COPY OF THIS REPLY WERE ALSO SIGNIFICANT FROM THE ANGLE OF ASCERTAINMENT THAT WHETHER THE ALLEGED PURCHASES WERE ON CREDIT BASIS OR CASH BASIS SO AS TO CHECK THE APPLICABILITY OF THE PROVISIONS OF SECTION 69/69C. FURTHER THERE IS NO DISCUSSION IN RESPECT OF REMAINING 3 PARTIES FOR WHICH THERE WAS NO ANY ADVERSE EVIDENCE ON RECORD. THERE CAN NOT BE ANY ADDITION IN THE ABSENCE OF ANY ADVERSE EVID ENCE ON RECORD. UNDER THE LAW THE ONUS LIES ON THE PARTY WHO CLAIM SOMETHING TO BE. THERE CANNOT BE ANY ONUS TO PROVE THE NEGATIVE. HENCE IF THE A.O. ALLEGES UNACCOUNTED PURCHASES THE ONUS LIES ON HIM TO PROVE IT. THERE CAN NOT BE ANY ONUS ON THE APPELL ANT TO PROVE THAT HE HAD NOT MADE ANY PURCHASES. BEFORE LD. CIT(A) THE APPELLANT AGREED FOR GP ADDITION IN ORDER TO CURTAIN THE LITIGATION. HOWEVER IT NO WAY MEANT THAT THE APPELLANT ACCEPTED UNACCOUNTED PURCHASES. HAD IT BEEN THE CASE THE APPELLANT W OULD NOT HAVE CHALLENGED THE ENTIRE ADDITION OF RS.4 70 000/ - IN THE APPEAL BEFORE THE HONBLE ITAT. 3 MA 18 TO 21 - RJT - 2013 DATTANI & CO. IN VIEW OF THE ABOVE IT MAY PLEASE BE APPRECIATED THAT THE DECISION TAKEN AS PER PARA 13 OF THE ORDER IS BASED ON INCORRECT ASSUMPTION OF THE FACTS IN RE SPECT OF TWO PARTIES AND THERE IS ABSENCE OF DECISION AND REASONING IN RESPECT OF REMAINING 3 PARTIES. HENCE THE APPELLATE ORDER REQUIRES RECTIFICATION. 2 . RE. : ADDITION IN RESPECT OF DIFFERENCE IN FIGURES OF PURCHASE AND SALES AS PER AUDITED ACCOUNTS AND AS PER SALES TAX ORDERS: - THE DECISION OF THE CAPTIONED ISSUE IS IN PARA 9 & 10 OF THE ITATS ORDER. IN PARA 9 TWO REASONS ARE GIVEN FOR NOT ACCEPTING THE SUBMISSION OF THE APPELLANT REGARDING APPLICATION OF GP. THE FIRST REASON IS THAT FOR UNACCOUNTED SALES UNACCOUNTED PURCHASES WOULD HAVE BEEN MADE OUTSIDE THE BOOKS AND IN THAT CASE THE INVESTMENT IN SUCH UNACCOUNTED PURCHASES WILL BE REQUIRED TO BE TAXED. THE ABOVE REASON COULD BE CORRECT ONLY WHEN ONETIME PAYMENT OF UNACCOUNTED PURCHASE IS MADE AN D THEY ARE SOLD OUTSIDE THE BOOKS. HOWEVER THESE ARE NOT THE FACTS OF THE APPELLANTS CASE. AS CAN BE SEEN FROM THE TABLE FURNISHED ON PAGE 2 OF THE PAPER BOOK OF THE APPELLANT THE ENTIRE DIFFERENCE IS NOT A ONETIME DIFFERENCE BUT AGGREGATE OVER 4 YEARS. HENCE THE FIRST REASON GIVEN IS INAPPLICABLE TO THE FACTS OF THE APPELLANTS CASE. IN SUCH CIRCUMSTANCES THE THEORY OF ROTATION OF MONEY COMES INTO PLAY. FURTHER THE CONTENTION OF UNDISCLOSED INVESTMENT IN PURCHASES IS DIRECTLY AGAINST THE LAW LAID DO WN BY THE HONBLE JURISDICTIONAL HIGH COURT IN CASES OF PRESIDENT INDUSTRIES (258 ITR 254) AND GURUBACHHAN SINGH J. JUNEJA (302 ITR 63) WHEREIN IT WAS HELD THAT IN THE ABSENCE OF ANY MATERIAL SHOWING ANY UNEXPLAINED INVESTMENT THE SAME CAN NOT BE TAXED. 4 MA 18 TO 21 - RJT - 2013 DATTANI & CO. THE ABOVE PRINCIPLE HAS BEEN DULY ACCEPTED BY THE HONBLE RAJKOT ITAT IN THE CASE OF GHANSHYAM ISSRANI RELIED UPON BY THE APPELLANT IN THE PAPER BOOK. IN PARA 12 OF THE ORDER ON PAGE 147 OF THE PAPER BOOK THE ITAT CLEARLY HELD FOLLOWING THE ABOVE JUDGMENT THAT IN THE ABSENCE OF ANY MATERIAL UNDISCLOSED INVESTMENTS IN UNRECORDED SALES CAN NOT BE ASSUMED AND ONLY GP OF SUCH UNRECORDED SALES CAN NOT BE ASSUMED AND ONLY GP OF SUCH UNRECORDED SALES CAN BE TAXED. IT MAY PLEASE BE NOTED THAT THESE JUDGMENTS WER E ALSO IN THE CONTEXT OF UNRECORDED SALES OUTSIDE THE BOOKS OF ACCOUNTS AND THEREFORE THE RATIONAL THEREOF SQUARELY APPLY TO THE CASE OF THE APPELLANT. ONCE THE ITAT TOOK THE VIEW IN PARA 9 THAT THE DIFFERENCE IN FIGURES REPRESENT UNRECORDED SALES THE RAT IONAL OF THIS JUDGMENT WERE DIRECTLY APPLICABLE TO THE CASE OF THE APPELLANT. THE SECOND REASON APPEARS TO BE IN CONTRADICTION IN FIRST REASON. THE FIRST REASON SEEMS TO BE ASSUMING PURCHASE AND SALES OF THE GOODS OUTSIDE THE BOOKS OF ACCOUNTS WHEREAS TH E SECOND REASON SEEMS TO BE ON THE THEORY OF UNDERSTATEMENT OF DISCLOSED SALE PROCEEDS. THE ACCOUNTING THEORY MENTIONED IN PARA 9 OF THE ITATS ORDER APPLIES IN CASE OF UNDERSTATEMENT OF CONSIDERATION AND NOT IN A CASE WHERE BOTH PURCHASE AND SALES ARE ASS UMED TO BE OUTSIDE THE BOOKS OF ACCOUNTS. HOWEVER THE SECOND REASON DOES NOT FLOW FROM THE ASSESSMENT ORDER AS THE CONTENTION OF THE A.O. WAS THAT OF PURCHASE AND SALES OUTSIDE THE BOOKS OF ACCOUNTS. WITHOUT PREJUDICE TO THE ABOVE IT IS FURTHER SUBMITT ED THAT THE FIGURES OF A.Y. 2003 - 04 HAVE REMAINED TO BE TAKEN INTO ACCOUNT WHILE CONFIRMING THE ADDITION OF ENTIRE AMOUNT OF SALES. IN VIEW OF THE ABOVE IT IS MOST RESPECTFULLY SUBMITTED THAT (1) THE FIRST REASON IS AGAINST THE FACTUAL MATRIX OF THE CASE THE THEORY OF ROTATION AND THE DIRECTLY APPLICABLE JUDGMENTS OF THE JURISDICTIONAL HIGH COURT AND RAJKOT ITAT; (2) THE SECOND REASON IS IN CONTRADICTION TO THE FIRST REASON AND THE SECOND REASON DOES NOT REPRESENT THE CASE OF THE A.O. 5 MA 18 TO 21 - RJT - 2013 DATTANI & CO. IN VIEW OF THE ABO VE WE MOST RESPECTFULLY SUBMIT AND PRAY THAT THE AFORESAID ITAT ORDER CONTAINS APPARENT MISTAKES AND INCORRECT ASSUMPTION OF FACTS. THE ITAT ORDER THEREFORE MAY PLEASE BE RE - CALLED. 3. WHILE FIRST PART OF THE MISCELLANEOUS APPLICATION ( BE ARING MA NO.18 /RJT/2013 RELATING TO THE ADDITION OF RS.4 70 000/ - ) RELATING TO ADDITION OF RS.4 70 000/ - ON ACCOUNT OF ALLEGED PURCHASES IS SPECIFIC TO ASSESSMENT YEAR 2002 - 03 (ITA NO.1249/RJT/2010); THE OTHER PART OF THE SAID MA RELATING TO ADDITION IN RESPECT OF DI FFERENCE IN FIGURES OF PURCHASE AND SALES AS PER AUDITED ACCOUNTS AND AS PER SALES TAX ORDERS RELATES TO NOT ONLY A SSESSMENT Y EAR 2002 - 03 BUT ALSO TO REMAINING A SSESSMENT Y EARS ALSO. 4. WE HAVE HEARD THE PARTIES AND CAREFULLY PERUSED THE MISCELLANEOUS AP PLICATIONS AS ALSO ALL OTHER MATERIALS AVAILABLE ON RECORD. B ARE PERUSAL OF THE MISCELLANEOUS APPLICATION FILED BY THE ASSESSEE SHOWS THAT THE ASSESSEE IS SEEKING REVIEW OF THE ORDER PASSED BY THIS TRIBUNAL ON 22.03.2013. SUCH REVIEW IS OUTSIDE THE SCOPE O F SECTION 254(2). MISTAKES OF OBVIOUS NATURE ALONE WHICH ARE APPARENT FROM THE RECORD ARE AMENDABLE TO RECTIFICATION U/S 254(2). CONSCIOUS DECISION TAKEN BY THIS TRIBUNAL IN ITS ORDER DATED 22.03.2013 ARE NOT AMENDABLE TO RECTIFICATION U/S 254(2). IN THI S VIEW OF THE MATTER ALL THE AFORESAID MISCELLANEOUS APPLICATIONS FILED BY THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED ON 31 . 0 7 . 201 3 SD/ - SD/ - (T. K. SHARMA) ( D. K. SRIVASTAVA) JUDICIAL MEMBER ACCOUNTANT MEMBER RAJKOT : 31 . 0 7 . 2013 * BT T K AK / COPY OF ORDER FORWARDED TO: - 1 . APPELLANT - M/S DATTANI & CO. JODHPUR GATE JAM - KHAMBHALIA JAMNAGAR 2 RESPONDENT - ITO WARD - 1(1) JAMNAGAR 3 . CONCERNED CIT JAMNAGAR 4 . CIT (A ) JAMNAGAR 5 . DR ITAT RAJKOT 6 . GUARD FILE BY ORDER TRUE COPY PRIVATE SECRETARY ITAT RAJKOT