The DCIT, Circle-4,, Ahmedabad v. Kajol Impex Limited, Ahmedabad

ITA 1178/AHD/2007 | 2003-2004
Pronouncement Date: 26-02-2010 | Result: Allowed

Appeal Details

RSA Number 117820514 RSA 2007
Bench Ahmedabad
Appeal Number ITA 1178/AHD/2007
Duration Of Justice 2 year(s) 11 month(s) 7 day(s)
Appellant The DCIT, Circle-4,, Ahmedabad
Respondent Kajol Impex Limited, Ahmedabad
Appeal Type Income Tax Appeal
Pronouncement Date 26-02-2010
Appeal Filed By Department
Order Result Allowed
Bench Allotted C
Tribunal Order Date 26-02-2010
Date Of Final Hearing 23-02-2010
Next Hearing Date 23-02-2010
Assessment Year 2003-2004
Appeal Filed On 19-03-2007
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'C' (BEFORE S/SHRI N S SAINI AND MAHAVIR SINGH) [ IN ITA NO.1178/AHD/2007 (ASSESSMENT YEAR:- 2003-04) THE DEPUTY COMMISSIONER OF INCOME-TAX CIRCLE-4 AHMEDABAD V/S KAJOL IMPEX LIMITED 801 HARIKRUPA TOWERS NEAR OLD SHARDA MANDIR ROAD ELLIS-BRIDGE AHMEDABAD [PETITIONER] [RESPONDENT] PETITIONER BY :- SHRI M C PANDIT SENIOR DR RESPONDENT BY:- NONE O R D E R PER N S SAINI (ACCOUNTANT MEMBER) : THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THE LEARNED COMMISSION ER OF INCOME- TAX (APPEALS) DATED 21-12-2006. 2 THE GROUNDS OF APPEAL TAKEN BY THE REVENUE ARE AS UNDER: 1 THE LD. CIT(A) ERRED IN LAW AND ON THE FACTS OF THE CASE IN DIRECTING THE AO TO DELETE THE ADDITION MADE BY THE AO ON ACC OUNT OF UNEXPLAINED CASH CREDITS STANDING IN THE NAMES OF ( I) KUVARJI FINSWTOCK P. LTD. RS.8 23 119/- (II) MANIBHADRA SH ARESINGH LTD. RS.5 99 293/- AFTER HOLDING THAT THEY WERE TRADE CR EDITORS AND NOT CASH CREDITORS AS TRANSACTIONS HAVE BEEN PROVED TO BE REGULAR BUSINESS TRANSACTIONS IGNORING THE FACT THAT SECTIO N 68 DOES NOT DIFFERENTIATE BETWEEN TRADE CREDITORS AND CASH CRED ITORS AS ALSO HELD IN THE CASE OF V.I.S.P. (P) LTD. VS. CIT REPORT ED AT (2004) 265 ITR 202 (MP). 2 THE LD. CIT(A) ERRED IN LAW AND ON THE FACTS OF THE CASE IN DIRECTING THE AO TO DELETE THE ADDITION MADE U/S 68 BY THE AO IN THE NAME OF POOJA VAGHELA ON THE GROUND THAT THE AO HAD NO REMARKS TO OFFER. IN FACT THE REMAND REPORT WAS SENT BY THE A O VIDE HIS LETTER 2 DATED 9-01-2007 BUT THE APPELLATE ORDER HAS BEEN PA SSED ON 21- 12-2006. 3 THE LD. CIT(A) ERRED IN LAW AND ON THE FACTS OF THE CASE IN DELETING THE ADDITION OF RS.68 85 587/- MADE BY THE AO IN RE SPECT OF LOSS ON TRADING IN SHARES AND DIRECTING THE AO TO TREAT THE SAME AS LOSS FROM SPECULATION BUSINESS AND TO GIVE DUE TREATMENT AS PER LAW IGNORING THE FACT THAT THE ASSESSEE HAS FAILED TO F URNISH FULL DETAILS OF PURCHASE AND SALE OF SHARES BROKERAGE DEMAT AC COUNTS CHARGES ETC. IN FACT THE REMAND REPORT WAS SENT BY THE AO VI DE HIS LETTER DATED 9-01-2007 BUT THE APPELLATE ORDER HAS BEEN PA SSED ON 21- 12-2006. 4 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE AO. 5 IT IS THEREFORE PRAYED THAT THE ORDER OF THE LD. CIT(A) MAY BE CANCELLED AND THAT OF THE AO MAY BE RESTORED TO THE ABOVE EXTENT. 3 NOTICE OF HEARING WAS SENT TO THE RESPONDENT-ASSE SSEE VIDE REGISTERED POST WITH A.D. ON 29-01-10 WHICH WAS RET URNED BY THE POSTAL AUTHORITIES WITH THE REMARKS LEFT. 4 SIMILAR WAS THE CASE WHEN THE NOTICE FOR HEARING FIXED ON 22- 05-2007 10-08-2007 AND 12-11-2007 WERE SENT. THERE FORE THE APPEAL WAS HEARD EX PARTE QUA THE RESPONDENT-ASSESS EE AND DISPOSING OF TAKING INTO CONSIDERATION THE SUBMISSI ONS OF THE LEARNED DEPARTMENTAL REPRESENTATIVE AND THE MATERIA LS AVAILABLE ON RECORD. 6 GROUND NO.2 OF THE APPEAL TAKEN BY THE REVENUE RE ADS AS UNDER: 2. THE LD. CIT(A) ERRED IN LAW AND ON THE FACTS OF THE CASE IN DIRECTING THE AO TO DELETE THE ADDITION MADE U/S 68 BY THE AO IN THE NAME OF POOJA VAGHELA ON THE GROUND THAT THE AO HAD NO REMARKS TO 3 OFFER. IN FACT THE REMAND REPORT WAS SENT BY THE A O VIDE HIS LETTER DATED 9-01-2007 BUT THE APPELLATE ORDER HAS BEEN PA SSED ON 21- 12-2006. 6 THE LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) WHILE DECIDING THE APPEAL OF THE ASSESSEE DELETING THE ADDITIONS OF RS .75 57 511/- AS UNEXPLAINED CASH CREDITS MADE BY THE LEARNED ASSESS ING OFFICER HAS OBSERVED IN HIS ORDER AT PAGE 2 PARA 3.3 THAT T HE LETTER WAS ADDRESSED TO THE AO ON 17-11-2006 CALLING FOR THE A O'S REPORT BY 30-11-2006 AND TILL 21-12-2006 I.E. THE DATE ON WHI CH THE ORDER WAS PASSED BY THE CIT(A) THE AO HAS NOT OFFERED HIS RE MARKS ON THE SUPPORTING PAPERS RELIED ON BY THE ASSESSEE. THE LE ARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT AS STATE D IN THE GROUNDS OF APPEAL TAKEN BY THE REVENUE THAT THE AO FILED HIS REPORT VIDE LETTER DATED 09-01-2007 THEREFORE IT WAS HIS PRAYER THAT THE MATTER SHOULD BE REMANDED BACK TO THE FILE OF THE C IT(A) TO DECIDE THE ISSUE AFRESH AFTER TAKING INTO CONSIDERATION TH E REMAND REPORT OF THE AO DATED 09-01-2007 FILED BEFORE HIM. 7 AFTER HEARING THE LEARNED DEPARTMENTAL REPRESENTA TIVE AND PERUSING THE ORDERS OF THE LOWER AUTHORITIES AND TH E MATERIALS AVAILABLE ON RECORD WE FIND THAT THE AO MADE THE A DDITIONS U/S 68 OF THE ACT OF RS.75 57 511/- ON ACCOUNT OF UNEXPLAI NED CASH CREDITS ON THE GROUND THAT NO CONFIRMATIONS WERE FILED FROM THE CREDITORS FOR THE LOANS RECEIVED FROM THEM DURING THE YEAR UN DER CONSIDERATION AND ALSO THE ADDRESSES OF THE PARTIES WERE NOT FURNISHED BEFORE THE AO AND IN THESE CIRCUMSTANCES THE AO HELD THAT THE GENUINENESS AND CREDITWORTHINESS OF THE PA RTIES COULD NOT BE ESTABLISHED BY THE ASSESSEE AND MADE THE ADDITIO NS TO THE INCOME OF THE ASSESSEE. WE FIND THAT BEFORE THE CIT (A) THE ASSESSEE FILED COPIES OF ACCOUNTS OF THE CREDITORS AND OTHER REQUISITE DETAILS 4 WHICH WERE FORWARDED TO THE AO FOR HIS COMMENTS BY THE CIT(A) ON 17-11-2006 ALLOWING TIME UPTO 30-11-2006 TO THE AO TO FILE HIS COMMENTS ON THE SAME. WE FIND THAT THE CIT(A) AFTER 30-11-2006 DID NOT SEND ANY REMINDER TO THE AO ASKING FOR HIS COMMENTS ON THE STATEMENT OF ACCOUNTS OF THE CREDITORS AND OTHER DE TAILS SENT TO HIM VIDE LETTER DATED 17-11-2006 AND DECIDED THE APPEAL OF THE ASSESSEE ON 21-12-2006. WE FIND THAT THE DR HAS SUBMITTED AT THE BAR THAT AO HAS FILED HIS REMAND REPORT ON 09-01-2007 WITHIN 60 DAYS OF SENDING OF THE PAPERS BY THE CIT(A). THUS THERE WA S NO UNREASONABLE DELAY ON THE PART OF THE AO IN SENDING HIS REMAND REPORT AND ALSO KEEPING IN VIEW THE FACT THAT NO RE MINDER WAS ISSUED BY THE CIT(A) TO THE AO FOR SENDING HIS REMA ND REPORT IN OUR CONSIDERED OPINION IT WOULD BE JUST AND FAIR TO AC CEPT THE PLEA OF THE REVENUE AND SET ASIDE THE ORDER OF THE CIT(A) A ND REMAND THE MATTER BACK TO HIS FILE TO DECIDE THE ISSUE AFRESH AFTER CONSIDERING THE REMAND REPORT OF THE AO DATED 09-01-2007 FILED BEFORE HIM. THEREFORE WE SET ASIDE THE ORDER OF THE CIT(A) AND DIRECT HIM TO ADJUDICATE THE ISSUE AFRESH AFTER CONSIDERING THE R EMAND REPORT OF THE AO DATED 09-01-2007 FILED BEFORE HIM AND AFTER ALLOWING REASONABLE AND PROPER OPPORTUNITY OF HEARING TO BOT H THE PARTIES. 8 IN THE RESULT THE APPEAL FILED BY THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER SIGNED DATED AND PRONOUNCED IN THE COURT AT THE CLOSE OF THE HEARING IN THE PRESENT OF BOTH THE PARTIES ON 26-02 -2010 SD/- SD/- (MAHAVIR SINGH) JUDICIAL MEMBER (N S SAINI) ACCOUNTANT MEMBER DATE : 26-02-2010 COPY OF THE ORDER FORWARDED TO : 5 1. KAJOL IMPEX LIMITED 801 HARIKRUPA TOWERS NEAR OLD SHARDA MANDIR ROAD ELLIS-BRIDGE AHMEDABAD 2. THE DCIT CIRCLE-4 AHMEDABAD 3. CIT CONCERNED 4. CIT(A)-VIII AHMEDABAD 5. THE DR ITAT AHMEDABAD 6. GUARD FILE BY ORDER DEPUTY REGISTRAR ASSISTANT REGISTRAR ITAT AHMEDABAD