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Income Tax Appellate Tribunal, “B”, BENCH KOLKATA
Before: SHRI S.S.GODARA, JM &DR. A.L.SAINI, AM
आदेश / O R D E R Per Bench:
The captioned appeal filed by the Revenue, pertaining to assessment year 2014-15, is directed against the order passed by the Commissioner of Income Tax (Appeal)-8, Kolkata, which in turn arises out of an assessment order passed by the Assessing Officer u/s 143(3) of the Income Tax Act, 1961 (in short the Act) dated 17/04/2018.
At the time of hearing none appeared on behalf of assessee in spite of issuance of notice for hearing more than one occasion and Ld. Departmental Representative(DR), was present for the appellant Revenue. In the absence of any appearance by the assessee, the appeal is being disposed of ex parte qua the M/s Greater Calcutta Land & Housing Corporation Assessment Year:2014-15 assessee, after hearing Ld. DR for the Revenue on merits in terms of Rule 24 of the Income Tax Appellate, Tribunal, Rules, 1963.
The grounds of appeal raised by the Revenue are as follows:
1. That the ld. CIT(A) has erred in accepting the submission of the assessee on face value, without proper enquiry despite the fact that the Act empowers him to do so.
2. That the ld. CIT(A) has erred in allowing the appeal of the assessee without going into merits of the case. 3. Without prejudice to the above, the ld. CIT(A) has erred in deleting the additions made by the Assessing Officer even though he observed that the submissions of the assessee is winding and meandering and not exact to the issues. 4. That the ld. CIT(A) has erred in not calling for a remand from the Assessing Officer. 5. That the appellant craves leave to add, alter, modify, delete or include any of the grounds of appeal.
4. At the outset itself, we note that in assessee’s case under consideration, the assessment was completed u/s 143(3) of the Act. The Assessing Officer has not rejected assessee’s books of accounts u/s 145(3) of the Act. i) the Assessing Officer made addition under the head loans and advances, treating them unaccounted money of the assessee at Rs. 5,56,60,895/-. ii) The Assessing Officer made addition under the head sundry creditors of Rs. 16,35,875/- as the assessee failed to produce details of sundry creditors. iii) The Assessing Officer made ad hoc 50% disallowance of various expenses.
5. Now coming to disallowance of loans and advances. We note that Assessing Officer made disallowance as the assessee failed to produce the details of unsecured loans to the tune of Rs. 5,56,60,895/- along with relevant documents to prove genuineness and creditworthiness of loan givers.
M/s Greater Calcutta Land & Housing Corporation Assessment Year:2014-15 6. During the appellate proceedings, the assessee submitted written submission before the ld. CIT(A) which is reproduced below:
“Rs. 5,56,60,895/- under the head unaccounted income from the balance sheet shown in the Liabilities side under the Head loans and Advances. This loan and advances is continued figure from the previous year. The assessee company procure land from the land purchase and sale those land after due plot into the different customers and it is an advance money from the customer and it is a liability to the firm. If the assessee was unable to deliver this land, they will refund back that amount to the intending buyer. Further the assessee borrowed money from bank and others. Year Loan Position in Details 2010-11 The loans figure was Rs. 5,22,57,486/- loan from UCO Bank Rs. 2.01.86,056/- Advance from M/s Suba Enterprise Rs. A.Y. 2011-12 3,25,000/- 2011-12 The Loans and Advances figure was Rs. 6,98,02,920/- A.Y. 2012-13 2012-13 The loans and advances was Rs. 6,00,64,129/-. A.Y. 2013-14 2013-14 The loans figure was 5,56,60,085/- which is now disallowed in full ignoring the carryover effect in the Balance Sheet. A.Y. 2014-15
On appeal, the ld. CIT(A) deleted the addition observing the following:
“ The loans and advances are entirely brought-forward balances from earlier AYs- since AY 2010-11. I have perused the Balance Sheets as on 31.03.2013 and as on 31.03.2014- and there will suffice. As on 31.03.2013 the loans & Advances were at Rs. 6,00,64,129/-. And as on 31.03.2014 the Loans and Advances had reduced to Rs. 5,56,60,895/-. The entire Loans and Advances being but brought forward balances from preceding AY(s) thus there cannot be any issue for addition in this A.Y. 2014-15.”
Having gone through the order of the ld. CIT(A), we do not find any infirmity in the order of the ld. CIT(A). Therefore, we confirm the order of the ld. CIT(A). That being so, we decline to interfere in the order of the ld. CIT(A), his order, on Page | 3
M/s Greater Calcutta Land & Housing Corporation Assessment Year:2014-15 this issue, is hereby accepted and the ground no. 1 raised by the revenue is dismissed.
Sundry Creditors- During the course of assessment proceedings , the assessee was repeatedly asked to produce the details of sundry creditors to the tune of Rs. 16,35,875/- along with name , address of the sundry creditors and nature of the transaction. But, the assessee failed to produce the same despite various opportunities were given to present the case. Hence, in absence of any supporting details, the sundry creditors to the tune of Rs. 16,35,875/- shown in the balance sheet was treated as bogus; and Assessing Officer made addition of Rs. 16,35,875/-.
On appeal, the ld. CIT(A) deleted the addition observing the following:
“Similar to the preceding issue above, here too, as on 31.03.2013 the Project Creditors were at Rs. 15,68,700/-; and as on 31.03.2014 it was at Rs. 16,35,870/-. Foremost, these are creditors for goods and services [not cash credit]. Therefore, even if some of them were doubted; there cannot be the case of ‘addition’. For academic discussion sake only- even if there were some that were doubted – if the relevant transaction / debit to the P & L a/c was in this A.Y., then it would be the case for disallowance of the item debited to the P & L a/c. If they were of preceding / earlier A.Y(s), then for possible initiation of proceedings u/s 147. But there is no such case here. The ACIT Assessing Officer has made substantial disallowance out of the P & L a/c – but it is mere arbitrary and ad hoc 50% disallowance.”
Having gone through the order of the ld. CIT(A), we do not find any infirmity in the order of the ld. CIT(A). Therefore, we confirm the order of the ld. CIT(A). That being so, we decline to interfere in the order of the ld. CIT(A), his order, on this issue, is hereby accepted and the ground no. 2 raised by the revenue is dismissed.
Different expenses- On verification of P/L Account for the year ended on 31.03.2014, it was noted by Assessing Officer that the assessee had claimed the various expenses which are as under:
M/s Greater Calcutta Land & Housing Corporation M/s Greater Calcutta Land & Housing Corporation Year: Assessment Year:2014-15 During the course of assessment proceedings, the assessee was repeatedly asked to During the course of assessment proceedings, the assessee was repeatedly asked to During the course of assessment proceedings, the assessee was repeatedly asked to produce the details of said expenses to the tune of Rs. 2,17,78,117/ produce the details of said expenses to the tune of Rs. 2,17,78,117/ produce the details of said expenses to the tune of Rs. 2,17,78,117/-. He was also asked to produce the details of utilization of the fund. But, the assessee failed to ce the details of utilization of the fund. But, the assessee failed to ce the details of utilization of the fund. But, the assessee failed to produce the same despite various opportunities were given to present the case. produce the same despite various opportunities were given to present the case. produce the same despite various opportunities were given to present the case. Considering the facts mentioned above, 50% of 2,17,78,117/ Considering the facts mentioned above, 50% of 2,17,78,117/ Considering the facts mentioned above, 50% of 2,17,78,117/- i.e. Rs. 1,08,89,059/- was disallowed and added back to the total income of the assessee. disallowed and added back to the total income of the assessee. disallowed and added back to the total income of the assessee.
On appeal, the ld. CIT(A) deleted the addition observing the following: 13. On appeal, the ld. CIT(A) deleted the addition observing the following: 13. On appeal, the ld. CIT(A) deleted the addition observing the following:
“The oddity is that disallowance has also been made from “Partner “The oddity is that disallowance has also been made from “Partner “The oddity is that disallowance has also been made from “Partner remuneration” – which is remuneration per sectio which is remuneration per section 40(b). As also of ‘audit fees’. n 40(b). As also of ‘audit fees’. As also of ‘salary and wages’ As also of ‘salary and wages’ – whereas payment to provident fund has been whereas payment to provident fund has been allowed. The ad hoc disallowance is but just mere arbitrary ad hoc disallowance The ad hoc disallowance is but just mere arbitrary ad hoc disallowance The ad hoc disallowance is but just mere arbitrary ad hoc disallowance – and astronomically high at 50%. mically high at 50%. are hereby deleted.” The impugned ad hoc disallowanc The impugned ad hoc disallowance(s) at Rs. 1,08,89,058/- are hereby deleted.”
Having gone through the order of the ld. CIT(A), Having gone through the order of the ld. CIT(A), we note that books of we note that books of accounts of the assessee were not rejected by Assessing Officer, therefore, accounts of the assessee were not rejected by Assessing Officer, therefore, accounts of the assessee were not rejected by Assessing Officer, therefore, we do not find any infirmity in the order of the ld. CIT not find any infirmity in the order of the ld. CIT(A). Therefore, we confirm the (A). Therefore, we confirm the order of the ld. CIT(A). That being so, we decline to interfere in the order of the order of the ld. CIT(A). That being so, we decline to interfere in the order of the order of the ld. CIT(A). That being so, we decline to interfere in the order of the Page | 5
M/s Greater Calcutta Land & Housing Corporation Assessment Year:2014-15 ld. CIT(A), his order, on this issue, is hereby accepted and the ground no. 2 raised by the revenue is dismissed.
In the result, the appeal of the Revenue is dismissed.
Order pronounced in the Court on 10.01.2020