Income Tax Appellate Tribunal - Pune
Renu Anil Goel,, Solapur vs Income-Tax Officer,, on 9 November, 2016
IN THE INCOME TAX APPELLATE TRIBUNAL
SMC BENCH, PUNE
ी आर. के. पांडा, लेखा सद य के सम
BEFORE SHRI R.K. PANDA, AM
आयकर अपील सं. / ITA No.557/PN/2015
नधारण वष / Assessment Year : 2007-08
Smt. Renu Anil Goel, .......... अपीलाथ /
At Post : Morvanchi, Appellant
Taluka : Solapur-413213
PAN :ABIPG6883G
बनाम v/s
ITO, Ward-1(1), Sangli .......... यथ /
Respondent
अपीलाथ क ओर से / Appellant by : Shri Kishor Phadke
यथ क ओर से / Respondent by : Shri P.L. Kureel
सन
ु वाई क तार ख / घोषणा क तार ख /
Date of Hearing :08.11.2016 Date of Pronouncement: 09.11.2016
आदे श / ORDER
PER R.K.PANDA, AM :
This appeal filed by the assessee is directed against the order dated 28-01-2015 of the CIT(A)-I & II, Kolhapur relating to Assessment Year 2007-08.
2. Although a number of grounds have been taken by the assessee they all relate to the order of the CIT(A) in confirming the addition of Rs.11,61,168/- on account of disallowance of expenses and Rs.23,82,081/- on account of disallowance of creditors by the Assessing Officer in the order passed u/s.144 of the I.T. Act.
3. Facts of the case, in brief, are that the assessee is an individual and is engaged in the business as a Commission Agent. She filed her return of income on 18-03-2008 declaring total income of Rs.1,43,412/- 2 ITA No.557/PN/2015 and agricultural income of Rs.15,80,230/-. Despite of service of notice, there was non-compliance from the side of the assessee. The Assessing Officer, therefore, proceeded to complete the assessment u/s.144 of the I.T. Act. After examination of the profit and loss account filed along with the return of income the Assessing Officer held that in absence of production of books of account, bills and vouchers, the various expenses claimed by the assessee remain unverified. In view of the above, the Assessing Officer disallowed expenses under various heads totaling to Rs.11,61,168/-.
4. Similarly, the Assessing Officer noted that assessee has shown creditors of Rs.23,82,081/- during the year under consideration. Since the assessee failed to discharge the onus cast on her by proving the identity and capacity of the creditors and the genuineness of the transaction, the Assessing Officer made addition of Rs.23,82,081/- as unexplained creditor u/s.68 of the I.T. Act. Since none appeared on behalf of the assessee the CIT(A) also decided the case exparte. After allowing 10% of the expenses of Rs.11,61,168/- being Rs.1,16,116/- as reasonable he confirmed the disallowance of balance expenses. Similarly, in absence of any clarification before him regarding the identify and capacity of the sundry creditors at Rs.23,82,081/- he upheld the action of the Assessing Officer in making addition u/s.68 of the I.T. Act.
5. Aggrieved with such order of the CIT(A) the assessee is in appeal before the Tribunal with the following modified grounds of appeal :
"1. The Ld.CIT(A) erred in law and on facts in not granting the effect of telescoping of disallowance of following expenses against the addition of Rs.23,82,081/- u/s.68 of the I.T. Act, 1961 incurred for unexplained creditors :3 ITA No.557/PN/2015
a. Expenses of Rs.10,45,051/- incurred for sale of bedana. b. Expenses of Rs.11,07,900/- incurred for earning the agricultural income.
2. The appellant craves leave to add, alter, amend and delete all or any of the grounds of appeal."
6. The Ld. Counsel for the assessee at the outset submitted that the assessee is a lady and due to her change of place she could not properly attend to the income-tax proceedings before the AO. Further, there was change in counsel for which the case was not attended properly before the CIT(A). He submitted that in the interest of justice one last opportunity should be given to the assessee by setting aside the matter either to the Assessing Officer or the CIT(A) and the assessee should be given an opportunity to explain her case.
7. The Ld. Departmental Representative on the other hand heavily opposed the arguments advanced by the Ld. Counsel for the assessee. He submitted that despite repeated opportunities given by the Assessing Officer as well as the CIT(A) the assessee has not bothered to appear before either of them. Therefore, the order passed by the CIT(A) confirming the addition made by the Assessing Officer should be upheld.
8. I have considered the rival arguments made by both the sides, perused the orders of the AO and the CIT(A) and the paper book filed on behalf of the assessee. I find the assessee in the instant case is acting as a Commission Agent on account of sale of Grapes and Pomegranates. She had filed her return of income declaring total income of Rs.1,43,412/- and agricultural income of Rs.15,80,230/-. Since there was non-compliance on the part of the assessee the Assessing Officer disallowed various expenses claimed in the profit and loss account and made addition of Rs.11,61,168/- on account of disallowance of 4 ITA No.557/PN/2015 expenses. Similarly, he made addition of Rs.23,82,081/- u/s.68 of the I.T. Act on account of sundry creditors in the balance sheet which could not be explained by the assessee. I find in appeal the Ld.CIT(A) restricted the disallowance of expenses to 90% of the expenses meaning thereby he allowed only 10% of the expenses as allowable. Similarly, he also sustained the addition of Rs.23,82,081/- made by the Assessing Officer u/s.68 of the I.T. Act on account of unexplained sundry creditors. It is the submission of the Ld. Counsel for the assessee that due to shifting of her place of residence by the assessee and change of Advocate the matter was not properly represented before the Assessing Officer as well as the CIT(A). It is also his submission that given an opportunity the assessee is in a position to substantiate her case. Considering the totality of the facts of the case and in the interest of justice, I deem it proper to restore the matter back to the file of the Assessing Officer with a direction to give one more opportunity to the assessee to substantiate her case. The assessee is also directed to cooperate with the Assessing Officer in completion of the assessment proceedings failing which the Assessing Officer is free to pass appropriate order as per law. I hold and direct accordingly. Grounds raised by the assessee are accordingly allowed for statistical purposes.
9. In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 09-11-2016.
Sd/-
(R.K. PANDA) ACCOUNTANT MEMBER पण ु े Pune; दनांक Dated : 09 November, 2016.
th सतीश 5 ITA No.557/PN/2015 आदे श क त"ल#प अ$े#षत/Copy of the Order forwarded to :
1. अपीलाथ / The Appellant
2. यथ / The Respondent
3. The CIT(A)-1 & 2, Kolhapur
4. The CIT,1 & 2, Kolhapur
5. $वभागीय %त%न*ध, आयकर अपील य अ*धकरण, "SMC Bench" पण ु े / DR, ITAT, "SMC Bench" Pune;
6. गाड2 फाईल / Guard file.
आदे शानस ु ार/ BY ORDER, स या$पत %त / True Copy // // True Copy // व&र'ठ %नजी स*चव / Sr. Private Secretary आयकर अपील य अ*धकरण, पुणे / ITAT, Pune