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Income Tax Appellate Tribunal, “B” BENCH, AHMEDABAD
Before: S/SHRI PRAMOD M. JAGTAP & T.R. SENTHIL KUMAR
आयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरण, अहमदाबाद �यायपीठ आयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरण अहमदाबाद �यायपीठ अहमदाबाद �यायपीठ ‘B’ अहमदाबाद। अहमदाबाद �यायपीठ अहमदाबाद। अहमदाबाद। अहमदाबाद। IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, AHMEDABAD (Conducted Through Virtual Court) ] ] BEFORE S/SHRI PRAMOD M. JAGTAP, VICE PRESIDENT AND T.R. SENTHIL KUMAR, JUDICIAL MEMBER ITA No.1399/Ahd/2016 Assessment Year : 2009-10 Ironbuild Systems P.Ltd. DCIT, Anand. I-58/59, GIDC Vs V.U. Nagar – 388 121 Ta. & Dist. Anand. अपीलाथ�/ (Appellant) �� यथ�/ (Respondent) Assessee by : Shri B.T. Thakar, AR Revenue by : Shri R.R. Makwana, Sr.DR सुनवाई क� तार�ख/Date of Hearing : 03/02/2022 घोषणा क� तार�ख /Date of Pronouncement: 21/02/2022 आदेश/O R D E R PER T.R. SENTHIL KUMAR, JUDICIAL MEMBER: This appeal is filed by the assessee against order dated 6.3.2014 passed by Ld.Commissioner of Income-tax (Appeals)-IV, Baroda [for short “Ld.CIT(A)] in Appeal No.CB/IV-A-355/2011-12 relating to the assessment year 2009-10.
Registry has pointed out a delay of 712 days in filing appeal before the Tribunal, and therefore, appeal is time barred by limitation. Shri Sarath Rajendraprasad, Director of assessee- company has filed an affidavit for condonation of delay by stating reasons for impugned delay as follows:
AFFIDAVIT
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I, Sarath Rajendraprasad Nair, S/o. Shri Rajendraprasad R..Nair, Director of Ironbuild Systems Pvt. Ltd., V. U. Nagar hereby declare on oath as under:
That I am Director in Ironbuild Systems Pvt. Ltd. V. U. Nagar
That the appeal has been preferred before the Hon. CIT-Appeals against the order of Dy. Commissioner of Income Tax, Anand Circle Anand for the AY 2009-10.
That the appeal before the Hon. CIT-Appeals had been disposed of by the Hon. CIT-Appeals on 6.3.2014.
That the fact is that the order was received by the Accounts Manager Shri Prakash Mannari, who was the incharge of accounts and finance at that time.
That the fact is that he has left the company in the month of May-2016 and left the country for better opportunities.
That the fact that after receiving the recovery notices from the Income Tax Department, Anand we came to know that the appeal was disposed off by the Hon. CIT-Appeals.
That the appeal effect for the above order also has been given by the Hon. Dy. Commissioner of Income Tax, Anand in the month of March-2016. And after giving the appeal effect the recovery proceedings were started and we came to know that the so much demand is pending in this case.
The fact that we were late in filling the appeal with the Hon. ITAT, Ahmedabad, without any fault of company.
This is the only reason why the appellant is filling the appeal late. Therefore we request your honour to condone the delay in filling the appeal against the order of the Hon. CIT-Appeals. We once again admit that there is no any other intention for filling the appeal on time and request your honour to condone the delay in filling the appeal.
Whatever stated above is true and correct. I am aware that doing wrong Affidavit is a crime.”
As can be seen from this affidavit, the impugned appeallate order dated 6.3.2014 was stated to have been received by the assessee-company by its the then Accounts Manager, Shri Prakash
ITA No.1399/Ahd/2019 3 Mannari who was in-charge of the accounts and finance of the company. It is also stated that he left the assessee-company in the month of May, 2016 and left country for better job opportunity. The assessee came to know about the disposal of the appeal when it received recovery notices from the Department.
We have gone through the affidavit filed by the Director of the assessee-company. The assessee is a private limited. No doubt it has its own Accounts Manager to look after accounts and financial management. Even before the ld.CIT(A) they had engaged a Chartered Accountant to represent the case on their behalf. The reason stated in their affidavit are not convincing for the fact that the impugned order received by the then Accounts Manager in 2014 itself, but he was stated to have left company and the country in the month of May, 2016 i.e. almost about 25 months after passing of the impugned order. Further reason assigned by the assessee is that the assessee came to know disposal of the appeal by the CIT(A) only after the department initiated recovery proceedings against the assessee in March, 2016, which is also not convincing and not a reasonable cause, because the assessee being a private limited company, would have reasonable manpower back-up, and would not have left the income-tax matter unattended for such a long period. Further, it is also not explained, when the then Accounts Manager had received the impugned order. Reasonable diligence is expected, where time is essence in taxation matters. In the absence of the same, the reasons attributable by the assessee are not convincing wherein a substantial delay of 712 days in filing appeal before the Tribunal has occurred. Therefore, we cannot accept the proposition putforth by the assessee-company as good and sufficient reason to condone such delay.
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The assessee has modified grounds before the Tribunal as follows:
“On the facts and in the circumstances of the case, the ld.CIT(Appeals) erred in confirming addition of Rs.33,61,451/- made by assessing officer on account of unverified purchases by invoking provision of sec 68 of the Income Tax Act, 1961”
Further, looking into the merits of the case also, laxity in filing appeal is more evident in the conduct of the assessee-company before the Ld.CIT(A) during the appellate proceedings. In this regard, we observe as follows.
A perusal of order of the ld.CIT(A) makes it very clear that while completing the assessment, the ld.AO has granted six opportunities to the assessee prove their case. Even before the CIT(A) there were two remand report called for by the ld.CIT(A) and the conclusion arrived at by the ld.CIT(A) are as follows:
“4.3.1. Thus it is seen that though the appellant had discharged its initial onus by providing the details of creditors/persons to whom the expenses have been paid, after the investigation made by the AO in the course of which such purchases/expenses were not confirmed by the other parties, onus shifted back on the appellant to establish the genuineness of such expenses. Despite, being provided with sufficient opportunities, it seems that the appellant did not make any effort in this regard for the purposes of obtaining confirmations from such parties. This inference is on account of the fact that the appellant had nowhere referred to any such effort made by it. The appellant asked the AO to issue summons to such parties without mentioning any fact to the effect that such parties were not co-operating with the appellant and the appellant was not having good relation with them and accordingly, was unable to obtain confirmation from such parties. On the contrary, the appellant has stated that with many of such parties he was having transactions in preceding and subsequent years. It is this unwillingness of the appellant to submit the evidences sought for by the AO which has lead to this appellate proceedings and the wastage of precious man power in making enquiries as has been mentioned above.
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4.3.2. When the matter was remanded back to the AO, he issued summons to 23 persons. Out of these, only 9 have furnished reply. Similarly, notice u/s 133(6) send through registered post AD in six cases were returned back by the post office. Further, out of the parties to whom appellant to establish the genuineness of transactions made with these parties with the help of other evidences. For e.g. in case of purchase, it should have provided the details of materials purchased, evidences regarding their transportation, regarding entry in stock register and utilization in the business of the appellant. Similarly/ regarding the other expenses it was incumbent upon the appellant to provide evidence regarding the rendering of services by other parties for whom the payments were made to them. But, right from the beginning, despite being provided with several opportunities during the course of the assessment proceedings as well as the appellate proceedings, the appellant has stuck to its argument that once it has provided full details regarding identity of the parties and since, payments have been made by the account payee cheques, hence, the genuineness of such expenses have to be accepted by the AO. In the 3rd Member decision of ITATAhmedabad Bench in the case of Amar Mining Co. 121 ITD 273(TM), the bench has held as follows:
"As regards deletion by the Commissioner (Appeals) of addition made by the Assessing Officer, it has been held by the Rajasthan High Court in case of Indian Woollen Carpet Factory v. ITAT [2003] 260 ITR 658/[20021 125 Taxman 763 that if the transactions are genuine and if the parties have migrated somewhere else, their latest address should have been supplied and burden is on the assessee to prove the genuineness of the transaction, when the assessee claimed that the purchases were genuine. That onus in the instant case had not been discharged. No material had been brought on record to prove the genuineness of the purchases made."
4.3.3. Accordingly, the purchases made from the parties which could not be verified by the AO as well as the other expenses paid to the parties with whom the AO could not verify such expenses even during the remand proceedings and also the appellant could not file confirmations before the AO are held as bogus and the additions of such amounts as income of the appellant by the AO is upheld. Balance amounts regarding which verification could be made by the AO/confirmations were filed before the AO are directed to be deleted.
4.4. So far as the addition of Rs.2,14,783/- on account of discrepancy between the amounts confirmed by the creditors and the books of accounts of the appellant is concerned, the appellant's explanation have already been reduced above. The appellant has filed explanation regarding amount of Rs.79,720/- out of the total addition of Rs.2,14,783/-. The explanations regarding difference in opening
ITA No.1399/Ahd/2019 6 balances are acceptable as the corresponding effect has to go to the preceding year. Regarding other explanations filed, the AO is directed to verify the contentions of the appellant and if this are found to be correct, the addition will stand deleted.
4.5. The addition of Rs.62,063/- for which no explanation has been filed by the appellant is upheld.”
Thus, enough opportunities were given to the assessee to prove its case both by the AO as well as by the Ld.Commissioner of Income-tax (Appeals). Further no new material or evidence is produced by the assessee before this Tribunal. The assessment year being 2010-11 no useful purpose will be served by entertaining this appeal at this point of time, wherein there is a delay of 712 days in filing of appeal. The reasons narrated by the assessee-company in its affidavit do not demonstrate sufficient cause or reasons so as to condone a huge delay of 712 days. Therefore, we decline to condone the delay in filing the appeal before the Tribunal. Thus, the appeal of assessee is dismissed in limine.
In the result, the appeal of the assessee is dismissed as un- admitted being time barred.
Order pronounced in the Court on 21st February, 2022 at Ahmedabad.
Sd/- Sd/- (PRAMOD M. JAGTAP) (T.R. SENTHIL KUMAR) JUDICIAL MEMBER VICE-PRESIDENT
Ahmedabad, dated 21/02/2022
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