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Income Tax Appellate Tribunal, “A” BENCH : BANGALORE
Before: SHRI ARUN KUMAR GARODIA & SHRI LALIET KUMAR
In course of hearing of these two stay petitions, it was submitted by the ld. AR of assessee that in fact, in both these years, the order of CIT (A) is very cryptic and therefore, instead of deciding the stay petitions, these appeals itself can be decided because the matter in both years has to be restored back to the file of CIT (A) for fresh decision by way of a speaking and reasoned order. The ld. DR of revenue opposed granting of stay. He also submitted that in both years, the order of CIT (A) should be confirmed.
We have considered the rival submissions. First of all, we examine this submission of the learned AR of the assessee that these appeals of the S.P. Nos. 278 & 279/Bang/2018 (in & 3352/Bang/2018) & ITA Nos. 3351 & 3352/Bang/2018 Page 2 of 4 assessee can be decided by restoring back the matter to CIT (A) for fresh decision by way of a speaking and reasoned order. We find that as per the statement of facts filed by the assessee before CIT (A) in both these years which run into 9 pages in Assessment Year 2014-15 and 7 pages in Assessment Year 2015-16, the assessee has made detailed submissions about the facts and the ld. CIT (A) has decided the disputed issue in both years in a very cryptic manner. For ready reference, we reproduce the relevant Para of the order of CIT (A) in both years. In Assessment Year 2014-15, the relevant Para of the order of ld. CIT (A) is Para nos. 7a to 9a. The same are reproduced hereinbelow for ready reference. “7a. The arguments of the AR are considered. I have carefully perused the order of the AO. In my view, the order of the AO needs no interference as the appellant has not been able to substantiate as to why the expenses have not been inflated. Therefore, the ground fails.
8. In ground number 4, estimation of income of Rs.8,28,000/- from TP registration is contested. The order of the AO is reproduced for the sake of clarity. "Letters were issued to some of the purchasers to provide details. As per which it was noticed that assessee collect on road price from customers however sales include only the showroom price as per invoice. When confronted assessee claimed that the amounts received towards registration and / or insurance and road tax are returned to clients and they are introduced to the brokers who gets the things done. Hence assessee is only liasoning and no financial thing is involved. If the amount if going to be returned to clients which in many of a times is in cash then it is not understandable as to why it is collected? Even without collecting the amount, the client can be introduced to broker and client would pay directly to broker. The same is not explained satisfactorily. With regard to TP registration, accountant Shri. Ajjappa F K stated that TP income is offered in subsequent year. However for A Y 2014-15 the same is not offered. Assessee's claim that no margin is taken by the assessee and entire amount received from customers towards TF registration is passed on to the brokers is not acceptable in absence of evidences. No details of brokers, payments made to them, mode of payment are provided in the TP registration. Hence the S.P. Nos. 278 & 279/Bang/2018 (in & 3352/Bang/2018) & ITA Nos. 3351 & 3352/Bang/2018 Page 3 of 4 undersigned do not have any other route than estimating the income from TF registration which is not offered for F Y 2013-4 Considering a margin of Rs. 800/- per vehicle, TP registration income (net is estimated at Rs.8,28,000/--). In view of the above, the assessment is concluded by making an addition of Rs. 40,28,932/- to the returned income." 8a. The arguments of the AR and submissions made are considered. I have carefully perused the order of the AO. In my view, the order of the AO needs no interference as I am not in agreement with the averment of the AR as to why the income from TP registration should not be added. Therefore, the ground fails.
In ground number 5, the appellant questions the validity of business premises being inspected by the AO during the course of scrutiny and in ground number 6, the appellant contends that the AO had passed order without giving proper opportunity to explain. 9a. I find it difficult to believe the same. The case was selected for scrutiny. Details were called for. It appears that the details provided were reasons enough for the AO to conduct physical inspection. Generally, this is not a practice. It is only to understand and appreciate, the AO has done this exercise. The AO has done a lot of work. So, it is not fair to say sufficient opportunity was not given. Therefore, both the grounds are dismissed for statistical purpose.”
Similarly, in Assessment Year 2015-16, the relevant Para of the order of CIT (A) are Para nos. 7a and 8 which are reproduced hereinbelow for ready reference. “7a. The arguments of the AR are considered. I have carefully perused the submissions made by the AR and the order of the AO. In my view, the order of the AO needs no interference as the appellant has not been able to reconcile the discrepancies found out by the AO. Therefore, the ground fails.
In ground number 6, the appellant contends that the AO had passed order without giving proper opportunity to explain. I find it difficult to believe the same. The case was selected for scrutiny. Details were called for. The AO has done a lot of work. So, it is not fair to say sufficient opportunity was not given. Therefore, the ground is dismissed for statistical purpose.”
S.P. Nos. 278 & 279/Bang/2018 (in & 3352/Bang/2018) & ITA Nos. 3351 & 3352/Bang/2018 Page 4 of 4 5. From the above paras reproduced from these two orders of ld. CIT (A), it is seen that ld. CIT (A) has simply held that in his view, the order of the AO needs no interference without any discussion and without indicating any basis for holding so. Hence, it is clear that he passed the order in cryptic manner without passing a speaking and reasoned order in respect of various contentions raised by the assessee. Hence we feel it proper to set aside these two orders of CIT (A) and restore the matter back to his file for a fresh decision by way of a speaking and reasoned order after providing reasonable opportunity of being heard to both sides. We order accordingly. Since the appeals of the assessee itself are decided, the stay petitions filed by assessee do not survive and hence, no adjudication is called for in respect of these two stay petitions.
In the result, both the appeals of the assessee are allowed for statistical purposes and both the stay petitions filed by the assessee are dismissed. Order pronounced in the open court on the date mentioned on the caption page.