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Smt. Anuradha Gupta, Prop. Versus The Commissioner of Income Tax, Alwar.

2015 (9) TMI 171 - ITAT JAIPUR

Revision u/s 263 - Held that:- For bank charges paid of ₹ 8363/-. The amount is nominal and ld. AO has examined the details of bank reconciliation with bank charges. Therefore, on this point, we do not find the order of AO erroneous and prejudicial to the interests of the revenue.

But commission payment, quantitative details and interest issue had not been examined by the AO after calling the partial details and there is no application of mind before allowing the same. It is fa .....

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t the AO has collected the information from the assessee and simply put on record which also shows that AO had not applied his mind on it.

Malabar Industrial Co. Ltd. case(2000 (2) TMI 10 - SUPREME Court) squarely applies wherein held that the scheme of the Act is to levy and collect tax in accordance with the provisions of the Act and this task is entrusted to the Revenue. If due to an erroneous order of the Income-tax Officer, the Revenue is losing tax lawfully payable by a person, .....

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are possible and the Income-tax Officer has taken one view with which the Commissioner does not agree, it cannot be treated as an erroneous order prejudicial to the interests of the Revenue unless the view taken by the Income-tax Officer is unsustainable in law.

The ld. CIT had set aside the order of the AO on certain issues for making proper enquiry and allow the adequate opportunity of being heard to the assessee on issues set right in the order itself. Accordingly we allow the asse .....

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grounds raised are as under :- (1) The ld. CIT, Alwar erred in law as well as on the fact of the case in invoking the provisions of Sec. 263 of the Act which is being contrary to the provisions of law and facts therefore, the impugned order u/s 263 of the Act kindly be quashed. (2) The ld. CIT, Alwar erred in law as well as on the fact of the case in assuming jurisdiction u/s 263 of the Act by wrongly and incorrectly holding that the subjected assessment order was passed on dated 31.12.2012 was .....

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he provisions of law, hence the impugned order kindly be quashed. (4) The ld. CIT, Alwar erred in law as well as on the facts of the case in setting-aside the assessment order dated 31.12.2012 with reference to all the following issues :- (i) Regarding payment of commission of ₹ 4,18,644/- to M/s. Pipes Centre, Madurai. (ii) Regarding the quantitative details of stock. (iii) Regarding advance of ₹ 2,50,000/- given to Shri Jagdish Meena. (iv) Regarding bank charges of ₹ 8,363.50 .....

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2010-11 by ld. CIT, Alwar. In this case the AO scrutinized the case under section 143(3) of the IT Act which was completed on 31.12.2012. The ld. CIT observed that assessee filed her return on 14.10.2010 declaring total income of ₹ 87,28,100/-. The assessment under section 143(3) of the Act was completed on 31.12.2012 at the total income of ₹ 87,61,650/- by DCIT Circle, Bharatpur. The ld. CIT issued show cause notice under section 263 to the assessee on 06.02.2014 treating the asses .....

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i. On perusal of the confirmation filed in the course of assessment proceedings, it was noticed that the above concern was dealing in MS, GI and PVC pipes only and the AO had allowed this commission without verifying the genuineness of nature of expenses, whether the above concern rendered any service for which commission was paid during the year. The AO passed the assessment order without obtaining any evidence on this issue. Since the assessee deals in business of trade/commission of food grai .....

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purchase amount of ₹ 5,09,376.77 only for the month of February, 2010 without weight. The total purchase (in weight) had been shown at 2,61,038.72 quintals, but after totaling it is found at 2,85,679.89 quintals. Thus weight-wise purchase has been shown less by 24,637.14 quintals. Similarly, the total sales (in weight) had been shown at 2,80,607.98 quintals but after totaling month-wise, it was found at 2,80,759 quintals. It was further noticed by the ld. CIT that average purchase price f .....

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ch, 2010, that the same is 1185.63 quintals. Accordingly the total difference comes to ₹ 3,96,948/-. Similarly as regards sales in weight, the assessee has shown the total sales at 2,80,607.98 quintals whereas the same is found to be at 2,80,759 quintals after month-wise totaling. The ld. A/R of the assessee tried to explain that this was the difference on account of weight of the gunny bags and debit notes received in the month of February, 2010. This aspect has not been considered by the .....

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lso borrowed money from market as well as from relatives for business purposes and paid interest on it. The AO had not verified the purpose/business expediency in advancing interest free loans. Thus the assessment was passed without proper enquiry on this issue. 2.3. The assessee paid interest charges totaling to ₹ 8363.50 on various dates which are penal in nature. The AO has not examined this issue while framing the assessment order. The ld. CIT relied on the following decisions :- (1) M .....

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nd without applying Principles of natural justice or without application of mind. (6) CIT vs. Jawahr Bhattacharjee 342 ITR 74 (Gauhati High Court) On - non application of mind by the AO. 2.4. The ld. CIT held that AO s order for assessment year 2010-11 dated 31.12.2012 not only erroneous but also prejudicial to the interests of the revenue. Accordingly he set aside the order passed by the A. O. with the direction that AO should properly examine the issue raised in the order passed under section .....

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2007) 295 ITR 282 (SC). The AO completed the assessment under section 143(3) after making various enquiries and due investigation. The required information was filed by the ld. A/R before the AO during the course of assessment proceedings for which he drawn our attention on pages 1 to 3 i. E. questionnaire dated 09.10.2012 issued by the AO to the assessee. The AO asked the assessee to submit the details of opening and closing stock in quantity in item no 15, Dalali expenses in item no. 17, Commi .....

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hich were duly examined by him. The ld. AO after examining the books of accounts had made no adverse remarks on the truthfulness and fairness of accounts. The ld. AO vide order sheet entry dated 21.12.2012 asked the assessee to file confirmation for commission paid with complete address which has been filed by the assessee on 28.12.2012, which contained complete name, address, mobile no., telephone no., GST/CST No. along with brokerage bill dated 25.02.2010. Therefore, the AO had discussed this .....

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ebit/credit notes received from various customers during the year which was generally issued at the end of the year by the traders. The AO had considered the GP and NP rates after verifying the evidences submitted by the assessee. Therefore, he applied his mind. Similarly the loan given to Shri Jagdish Meena has also been considered by the AO as per query letter dated 09.10.2012 under the head Interest payment and received during the year under consideration which was replied by the assessee on .....

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passed by ld. CIT under sec. 263 of the IT Act. 4. At the outset, the ld. CIT DR supported the order of ld. CIT, Alwar and argued that the AO had made a very short and cryptic assessment order and not only he had not applied his mind but no enquiry was conducted before allowing the expenses. Therefore, order of ld. CIT may please be confirmed. 5. We have heard rival contentions and perused the material on record. The ld. CIT considered five issues under section 263 i. E. commission payment, qua .....

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nue. But commission payment, quantitative details and interest issue had not been examined by the AO after calling the partial details and there is no application of mind before allowing the same. It is fact that assessee is a commission agent and wholesale general merchant of grains. However, the commission claimed to be paid to M/s. Rajesh Pipe Centre, Madurai who is dealing in MS, GI and PVC pipes. Further, in quantitative details, there was a discrepancy in assessment record which has not be .....

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