Principal Commissioner Of vs. M/S Regent Beers And Wines Ltd.

IN THE HIGH COURT OF MADHYA PRADESH AT JABALPUR BEFORE HON'BLE SHRI JUSTICE SHEEL NAGU & HON’BLE SHRI JUSTICE AMAR NATH (KESHARWANI) ON THE 16th OF AUGUST, 2023 ITA No.271 of 2022 BETWEEN:- PRINCIPAL

COMMISSIONER

OF INCOME TAX (CENTRAL) MP & CG, AAYAKAR BHAWAN, HOSHANGABAD ROAD, BHOPAL (M.P.) .....APPELLANT (BY SHRI SIDDHARTH SHARMA) AND M/S REGENT BEERS & WINES LTD THROUGH AUTHORIZED OFFICER, 509 510, PRINCES BUSINESS SKY PARK, SCHEME NO.54 PU-3 COMMERCIAL, VIJAY NAGAR, INDORE (M.P.) .....RESPONDENT (BY SHRI VASHISTHA NARAYAN DUBEY & SHRI MALLIKAJUN KHARE - ADVOCATES) ------------------------------------------------------------------------------------------------ - 2 - This petition coming on for admission this day, Hon’ble Shri Justice SHEEL NAGU passed the following: ORDER This appeal filed u/S 260A of the Income Tax Act, 1961 (hereinafter referred to as “IT Act”) assails the final order dated 18.04.2022 passed by Income Tax Appellate Tribunal, Indore (for short “Tribunal”) in IT(SS)A No.21/IND/2020 whereby appeals of Revenue were dismissed thereby upholding order dated 01.11.2019 passed by CIT(A)-3, Bhopal which in turn interfered with the orders of Assessing Officer by which addition was made to the tune of Rs.8,44,86,020/-. 2. Learned counsel for rival parties are heard on the question of admission so also final disposal. 3. Learned counsel for the Revenue Shri Siddharth Sharma has proposed following substantial questions of law: “1. Whether, on the facts and circumstances of the case, ITAT has erred in upholding the decision of Ld. CIT(A) by not appreciating the facts mentioned in the remand report and in accepting the additional evidence submitted by the assessee during the appeal proceedings, without furnishing any proper justification or identifying the circumstance which have hindered the assessee to comply during assessment proceedings, as laid down in Rule 46A of the Income Tax Rules, 1962? 2. Whether, on the facts and circumstances of the case, ITAT has erred in upholding the decision of Ld. CIT(A) by deleting the addition of Rs.8,98,830/- made by - 3 - the AO on account of disallowance of expenses u/s 40A(3) of the Act? 3. Whether, on the facts and circumstances of the case, ITAT has erred in upholding the decision of Ld. CIT(A) by deleting the addition of Rs.10,60,043/- made by the AO on account of disallowance of expenses u/s 40A(3) of the Act? 4. Whether, on the facts and circumstances of the case, ITAT has erred in upholding the decision of Ld. CIT(A) by deleting the addition of Rs.8,44,86,020/- made by the AO on account of undisclosed income? 5. Whether, on the facts and circumstances of the case, ITAT has erred in upholding the decision of Ld. CIT(A) by deleting the addition of Rs.38,63,950/- made by the AO on account of undisclosed income? 6. Whether, on the facts and in law, the ITAT was justified in confirming the finding of the Ld. CIT(A) and, failing to allude to relevant facts brought on record by AO, misread the evidences and its probative value & also the provisions of the Act, leading to the perversity of the order which itself gives rise to question of law in view of ratio of decision in the case of Sudarshan Silk and Sarees 300 ITR 205 (SC)?" 4. Bare perusal of the finding rendered by the Tribunal reveals that the Tribunal found that Assessing Officer while causing addition on account of disallowance u/S 40-A(3)-40A(3) of the IT Act as regards Assessment Year 2014-15, failed to provide any basis for working out the difference between the contents of two financial datas in the parallel books maintained by ABCL Ltd. and the Assessee himself. The Tribunal also found that data available on record was only in respect of liability but not as regards assets or expenditure. Tribunal thus found that in view of above Assessing Officer wrongly held the difference to be invested in fixed assets and undisclosed expenditure, without any - 4 - supportive material on record. The Tribunal therefore drew inference that Assessee had incurred certain liability which though recorded in the parallel Books of Accounts of the Assessee was not recorded in the regular Audited Books of Account. The Tribunal in this background found that the case of the Assessee was of suppression of liability in the Audited Books of Account vis-a-vis the parallel set of Books of Account and; therefore, it was rightly concluded by the Tribunal that under the law undisclosed investment or undisclosed expenditure can be subject matter of addition either u/S 69 or 69A or 69B or 69C of the IT Act but in the present case the issue is not in regard to undisclosed investment or expenditure but undisclosed liability. Accordingly, the Tribunal held that the findings of the Assessing Officer in this regard are based purely on assumption and; therefore, the addition made by the Assessing Officer of the income to the tune of Rs.8,44,86,020/- was held unjustified. 4.1 In regard to the other proposed substantial questions of law, the Tribunal has rendered finding after due consideration of facts. 5. The findings rendered by the Tribunal are factual in nature. More so, the Revenue in this appeal is asking this Court to interfere in concurrent finding of fact rendered by the Tribunal as well as CIT(Appeal). - 5 - 6. In regard to the factual finding rendered by the Tribunal, no substantial questions of law arise in the present appeal. The appeal is; therefore, dismissed sans cost. (SHEEL NAGU) (AMAR NATH KESHARWANI) JUDGE JUDGE YS Digitally signed by YOGESH KUMAR SHIRVASTAVA Date: 2023.08.22 12:51:51 +05'30'