"" Û
IN THE INCOME TAX APPELLATE TRIBUNAL "G" BENCH, MUMBAI
.. , Û è , è ¢
BEFORE SHRI I.P. BANSAL, JM AND SHRI SANJAY ARORA, AM
M.A. No. 194/Mum/2013(Assessment Year: 2007-08)
(Arising out of I.T.A. No. 3969/Mum/2012)
M/s. R.W. Promotions Pvt. Ltd. , ACIT- (9)(3),
M-30, Hirnen Shopping Centre, / Mumbai.
M.G.Road, Goregaon (West), Vs.
Mumbai-400062
è . / . /PAN/GIR No. AACCR7660J
( /Applicant) : (× / Respondent)
[ / Applicant by : Shri Pradeep Kapasi
è / Respondent by : Shri Agshar Jain V.P. Sr. A.R.
/
: 22.05.2015
Date of Hearing
/
: 12.06.2015
Date of Pronouncement
/ O R D E R
Per Sanjay Arora, A. M.:
This is a petition u/s. 254(2) of the Income-tax Act, 1961 (the Act hereinafter)
preferred by the assessee-appellant, directed against the order u/s. 254(1) dated
16.01.2013 passed by the Tribunal disposing its' captioned appeal.
2. The Miscellaneous Application assails the impugned order on several grounds,
raising legal and factual issues. In fact, the application is argumentative, raising
M.A.No.194 Mum 2013 M/s. R.W. Promotions Pvt. Ltd
several contentions, some of which we find as outright relevant. It may therefore be,
at the outset, even as was during the hearing (of the instant proceedings), clarified
that there is no scope for re-arguing the appeal in rectification proceedings, which
would thus stand to be confined to clear mistakes of fact/s or even of law. We having
clarified the premises and the scope of the present proceedings, proceed to discuss the
issue raised by the assessee, in seriatim:
3. The first ground (numbered 3) states of the assessee having not been provided
the copy of the reasons recorded for re-opening of assessment u/s. 147, but only the
gist thereof. Without doubt, the reasons cannot be improved upon in any manner, of
which there is in fact no allegation or charge, either in the appeal or in the present
proceedings. It is, firstly, debatable that where the assessee is informed of the reasons
for re-opening of assessment, though employing different words, conveying the same
meaning and information, would the requirement of informing the assessee of the
reasons be satisfied? The requirement is procedural, with a view to informing the
assessee of the Revenue's case against it, so that, would not, secondly, even assuming
strict compliance, so that the reasons had to conveyed verbatim, lead to the quashing
of the assessment ( or re-assessment) or its restoration to such where the irregularity
had crept in (Guduthur Bros. v. ITO [1960] 40 ITR 298 (SC). The forgoing two issues
stand noticed by us only to exhibit the debatable nature of the controversy or the
issues raised, impermissible u/s. 254(2). On facts, the Tribunal had clearly stated that
the assessee had been in fact supplied the verbatim copy of the reasons, reproducing
the same at paragraph 2 (page 2) of its order. The tribunal's findings appear at
paragraph 2.8 of the impugned order. The omission of the last sentence is not a
reason itself, but only the concluding sentence, stating of the foregoing as being the
reasons for belief as to escapement of income. Inasmuch as the same does not bear
any reason, we do not find that it could be said that the assessee had not been
conveyed the reasons as to escapement of income, or had been so either in part or
only the gist thereof, as alleged. That the same are only reasons leading to the belief
as to the escapement of income is evident and implied. What are these then and for
and toward what are they being given, or given as, etc. would be the queries arising
out of the assessee's clearly unreasonable and unconvincing stand. Further, even
2
M.A.No.194 Mum 2013 M/s. R.W. Promotions Pvt. Ltd
assuming, without admitting, a debate, it would preclude section 254(2). The said
ground is accordingly rejected.
4. Vide ground 3(ii), the assessee claims non-application of mind by the
Assessing Officer (AO) in the matter, who has stated to have reopened simply on the
basis of the findings of the DDIT(Inv.). The tribunal discusses this aspect at
paragraph 2.11 through 2.15 of its order, meeting the assessee's arguments, to hold
that there was material available with the AO on the basis of which a reasonable
belief that income chargeable to tax had escaped assessment could be formed
(paragraph 2.12). The same is a finding of fact, and for which the tribunal tranverses,
as apparent from the discussion, through the said materials, issuing its final findings
at paragraph 2.15. The assessee has also, vide ground 3(iii) referred to the tribunal's
observation that assessment had been reopened on the basis of section 132(4)
statement made at the time of search which was on oath (at paragraph 2.14). It is
stated that in so stating, the tribunal has overlooked that there was a survey at the
vendor's premises prior to the relevant search. How would, we wonder, that
contradict or impugn the said observation by the tribunal in any manner? What the
tribunal states is again a matter of fact, borne out by the reasons recorded and the
material on record. Two, the fact that the search was preceeded by a survey, on the
contrary, is defeating of the assessee's case inasmuch as, clearly, material was found
in survey leading to the search. The statement by the tribunal, it must be appreciated,
was made while considering the assessee's plea of there being no material for
forming, prima-facie, a reasonable belief as to escapement of income. Whether,
rather, there is material on record establishing the said survey is itself not known, for
the assessee to have raised the plea, which though we have found as irrelevant. The
ground is without basis.
5. Vide ground 4, the assessee raises several factual issues, or, rather, sub-issues.
Each of these, in our view, amount to re-arguing the appeal. The tribunal confirmed
the disallowance of expenditure booked in favour of the two concerns, M/s. Inorbit
Marketing and Services Pvt. Ltd. and M/s. Nupur Management Consultancy Pvt.
Ltd., in view of lack of substantiation of the actual rendering of the services, i.e., for
3
M.A.No.194 Mum 2013 M/s. R.W. Promotions Pvt. Ltd
which the sums had been `paid' to them. There is nothing to show that the
`overwhelming evidences', as stated by the assessee, had not been considered by the
tribunal. On the contrary, the tribunal found material on the basis of which it stood, in
its view, established that the two concerns were shell companies, who had given
accommodation entries to the assessee. In fact, there were 53 other parties, i.e., as the
assessee, who had surrendered income consequent to the search (a number which the
assessee confirms to be at 21, i.e., instead of 53). In fact, rather than the assessee
proving the expenditure, as we see it, the tribunal considered the same to have been
disproved. The relevant discussion appears at paragraphs 3 through 3.14 (pages 18-
30) of the tribunal's order. That documentary evidences may not by themselves be
sufficient and could be unveiled by the assessing authority, is trite law, and for which
reference may be made to the decisions in the case of CIT v. Durga Prasad More
[1973] 82 ITR 540 (SC) and Sumati Dayal v. CIT [1995] 214 ITR 801 (SC), while the
tribunal refers to the decisions in the case Lachminarayan Madanlal v. CIT [1972] 86
ITR 439 and Lakshmiratan Cotton Mills Co. Ltd. v. CIT [1969] 73 ITR 634 (SC).
Each of the arguments raised by the assessee stand duly considered by the tribunal.
Finding/s of fact, rendered upon appreciation of evidences, could not be revisited in
rectification proceedings. We, accordingly, find no ground for the same.
6. Vide ground 5, the assessee claims that there was denial of opportunity to
cross-examine the AO's witnesses and, thus, a violation of the principle of natural
justice, further stating that the tribunal had, in like cases, restored the matter back to
the file of the AO on that ground. Could, one may ask, the said orders by the tribunal
questioned on the basis of a different view in the impugned order? The argument is
misplaced. For all we know, the cross-examination may not have been asked for,
being in the nature of deposition/s. The tribunal has considered the argument (refer
para 3.10), and in its view the disallowance had not been affected only on the basis of
the said statements and, two, that all the material had been duly confronted to the
assessee. It also clearly states that the rendering of the services by the companies
could not be accepted on the basis of affidavits (para 3.11). The said ground is, again,
without merit.
4
M.A.No.194 Mum 2013 M/s. R.W. Promotions Pvt. Ltd
7. In the result, the assessee's M.A. is dismissed.
Order pronounced in the open court on June 12, 2015
Sd/- Sd/-
(I.P. Bansal) (Sanjay Arora)
Û è / Judicial Member è / Accountant Member
Mumbai; Dated : 12.06.2015
../Sharwan. PS
/Copy of the Order forwarded to :
1. / The Applicant
2. × / The Respondent
3. () / The CIT(A)
È
4. / CIT - concerned
È
5. , , / DR, ITAT, Mumbai
6. [ / Guard File
/ BY ORDER,
/ (Dy./Asstt. Registrar)
, / ITAT, Mumbai
5
|
