THE GOWTHAMI SOLVENT OILS LTD.,,TANUKU vs. THE ACIT,, RAJAHMUNDRY

IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH, VISAKHAPATNAM BEFORE SHRI V. DURGA RAO, HON’BLE JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH, HON’BLE ACCOUNTANT MEMBER ITA No. 610/VIZ/2014 (Asst. Year : 2010-11) M/s. The Gowthami Solvent Oils vs. ACIT, Circle - 1, Ltd., P.B.No. 7, Pydiparru, Rajahmundry. Tanuku, W.G. District. PAN No. AAACT 6359 A (Appellant) (Respondent)

Assessee by : Shri E.V. Sri Krishna & Shri C. Subrahmanyam– CAs. Department By : Shri P.S. Murthy – Sr. DR Date of hearing : 20/02/2018. Date of pronouncement : 23/02/2018. O R D E R PER V. DURGA RAO, JUDICIAL MEMBER

This is an appeal filed by the assessee against the order of ld.CIT (A), Visakhapatnam, dated 22/09/2014 for the Assessment Year 2010-11. 2. Facts are in brief that the assessee is engaged in generation of power plant, manufacturing of rice ban oil, fatty acid oil, de-oiled bran and spinning of cotton yarn. The assessee filed its return of income by declaring total income of Rs. 5,16,31,580/-. The case of the assessee was selected for scrutiny and after following due procedure, assessment is completed under section

2 ITA No.610/VIZ/2014 (M/s. The Gowthami Solvent Oils Ltd.) 143(3) of the Act by making addition in respect of sundry creditors of Rs. 49,72,933/-. During the course of assessment proceedings, the Assessing Officer called the details of the following sundry creditors:- S.No. Description Amount (Rs.) 1 Smt. Mallina Bharati Rao 488 2 Shri ANV Prasad 15,000 3 B.H. Venkata Satyanarayana 50,000 4 Lakshmi Ganapati Enterprises 51,358 5 Sai Gayatri Soap Works 3,55,910 6 Sanjeev Agro Pvt Ltd.,. 39,097 7 Sundry Creditors DOB Agent 6,95,715 8 Sundry Creditor Oil Agenty 3,10,243 9 Sundry Creditor Refined Oil 10,07,603 Agent 10 Sundry Creditors Soya 1,33,125 11 FCS Creditors on yarn/Cotton 3,62,320 12 S.V. Oil & Chemical Industry 670 13 Sri Y.V. Rama Krishna 50,000 14 Sundry Creditors Yarn Agent 19,01,404 Total 49,72,933

The assessee has filed the relevant details before the Assessing Officer. The Assessing Officer also noted that in certain confirmation letters submitted by the assessee, there is a overwriting, changes of dates and information by using whitener etc. Therefore, he took a view that the assessee could not establish the identity, genuineness of the transactions of some of the creditors, hence, disallowed Rs. 49,72,933/-. 3. On appeal before the ld. CIT(A) also, the assessee could not furnish the confirmations in respect of creditors referred at S.No.

3 ITA No.610/VIZ/2014 (M/s. The Gowthami Solvent Oils Ltd.) 1, 6, 7, 8, 9, 10, 11 & 14 of the above table. In respect of S.No.6, the assessee has filed only ledger extract, in respect of S.Nos. 2, 3, 13 confirmation letters were filed, in respect of S.No. 4 & 5, account statements were filed. Therefore, ld.CIT(A) has directed the Assessing Officer to consider the details filed by the assessee and re-compute the total income of the assessee. 4. Before us, Ld. Authorized Representative for the assessee has filed a petition under Rule 29 of the ITAT Rules, 1963 seeking admission of additional evidence in the form of paper book, which is consisting of ledger copy of the creditors at page No.376, confirmation letters from the creditors at page No. 377 and ledger copies of creditors for the next years at page No. 378 to 390. 5. On the other hand, the Ld. D.R. strongly opposed for admission of additional evidence and submitted that many opportunities have been given by the Assessing Officer, but assessee has not utilized to file the details. 6. We have heard both the parties. 7. We find that the Assessing Officer has made the addition in respect of 14 sundry creditors of Rs. 49,72,933/-. The assessee has not filed the relevant details before the Assessing Officer, therefore he made an addition under section 68 of the Act. Before the ld. CIT(A) also, the assessee has not filed the details of some

4 ITA No.610/VIZ/2014 (M/s. The Gowthami Solvent Oils Ltd.) of the above sundry creditors, therefore, ld. CIT(A) remanded the matter back to the Assessing Officer for consideration of the same. Now, the assessee has moved a petition for admission of additional evidence and submitted that all the details of the sundry creditors are available with the assessee and the same may be admitted, and direct the Assessing Officer to consider the same. By considering the facts and circumstances of the case, we are of the opinion that the additional evidence filed by the assessee has to be admitted. Accordingly, we admit the additional evidence and set aside the order passed by the ld.CIT(A) and remand the matter back to the Assessing Officer to adjudicate the issue afresh by considering the additional evidence filed by the assessee and decide the issue in accordance with law.

Sd/- sd/- (D.S. SUNDER SINGH) (V. DURGA RAO) Accountant Member Judicial Member Dated : 23rd February, 2018. vr/-

5 ITA No.610/VIZ/2014 (M/s. The Gowthami Solvent Oils Ltd.) Copy to: 1. The Assessee- M/s. The Gowthami Solvent Oils Ltd., P.B.No. 7, Pydiparru, Tanuku, W.G. District. 2. The Revenue – ACIT, Circle-1, Rajahmundry. 3. The CIT, Rajahmundry. 4. The CIT(A), Visakhapatnam. 5. The D.R., Visakhapatnam. 6. Guard file. By order

(VUKKEM RAMBABU) Sr.PS, ITAT, Vizag.