TMI Blog2020 (2) TMI 1144X X X X Extracts X X X X X X X X Extracts X X X X ..... opening of assessment by the AO after the expiry of four years from the end of the assessment year under consideration was in accordance with the relevant provisions of the Act including the 1st Proviso to Section 147. We, therefore, find no infirmity in the reopening of assessment as made by the Assessing Officer on the basis of reasons recorded by him and upholding the validity of the same, we dismiss the Cross Objection filed by the assessee. Suppression of export sales - matter of appreciated by the ld. CIT(Appeals) in the right perspective and he deleted the addition made by the Assessing Officer on this issue by placing the onus wrongly on the Assessing Officer by observing that the Assessing Officer should have obtained the details of figures reported by Paradeep Port Trust and furnished the same to the assessee so as to enable the assessee to reconcile the difference. In our opinion, the said details ought to have been obtained by the assessee so as to support and substantiate its explanation that the export of iron ore to the extent of 8,000 Metric Ton actually pertaining to the immediately succeeding year was included by Paradeep Port Trust in the export figure of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nted out by the Assessing Officer in the audited account was due to inter-grouping error. It was also submitted that the production of iron ore as shown in Shah Commission s report was erroneous. In order to verify this aspect, a notice under section 133(6) of the Act was issued by the Assessing Officer to the Manager of Paradeep Port Trust through which the iron ore was exported by the assessee. As per the reply received by the Assessing Officer from Paradeep Port Trust, total quantity of iron ore exported by the assessee during the year under consideration was 3,90,872 Metric Ton. Since the assessee had shown the total export of 3,82,872 Metric Ton in its books of account for the year under consideration, the Assessing Officer required the assessee to explain the difference in the export of iron ore to the extent of 8,000 Metric Ton. In reply, it was submitted by the assessee that the details of export of iron ore were also given by Paradeep Port Trust in their reply for other years. It was pointed out that the export shown by Paradeep Port Trust in their reply was less by 23,000 Metric Ton and 47,600 Metric Ton in the previous year relevant to assessment years 2009-10 and 2010 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e submissions of the Ld. ARs of the appellant and the reasons recorded by the Ld. AO for reopening the income-tax assessment for the relevant A.Y. 2008-09. In the present case the proceedings u/s 147 were initiated after 4 years. The notice was issued after the expiry of four years from the end of the relevant assessment year and therefore it was necessary to ensure that conditions prescribed in the first proviso to Section 147 were attracted. In terms of the said first proviso the assessment could have been reopened only if there was failure on the part of the assessee to disclose truly and fully all the facts necessary for assessing total income, which was chargeable to tax for the relevant assessment year. In the present case in the objections raised at appellate stage, the Ld. ARs claimed that the Ld. AO did not provide the appellant with recorded reasons within reasonable time and thereafter when the objections were filed he disposed the objections by passing an order in the perfunctory manner and that also just before the assessment was getting barred by limitation. According to the ld. ARs of the appellant, the acts of the ld. AO were designed with premedi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aterial facts truly and fully, I am of the considered view and opinion that such disclosure was not made by the appellant when the order u/s 143(3) was passed. 4. For the foregoing reasons therefore I am of the opinion that the Ld. AO rightly invoked provisions of Section 147 before issuing notice u/s 148 of the Income Tax act, 1961. Since, I have held that the initiation of proceedings u/s 148 was valid and proper, the consequent order passed u/s 147/ 143(3)/153A dated 30,03.2016 is also held to be valid. Accordingly, I do not find merit in the additional Grounds Nos. 1 2, and the same are therefore dismissed . 5. The ld. CIT(Appeals), however, found merit in the submission made on behalf of the assessee in support of its case that the addition of ₹ 2,93,18,510/- made on account of the alleged suppression of export sale was not sustainable and deleted the same for the following reasons given on pages 15 to 18 of his impugned order:- 4. I have carefully perused the submissions filed by the appellant against the impugned observations of the Ld. AO. The question to be addressed is whether the figures shown by the Paradeep Port Trust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 24477735 34340 159440611 2011-12 27600 189242820 75800 440429125 2012-13 NIL NIL NIL NIL 2013-14 43200 221878440 NIL NIL 2014-15 NIL NIL NIL NIL The differences that emerge as follows: 1. In the A.Y 2008-09, the PPT has shown total figure of export of 3,90,872 MT, whereas the appellant has shown figure of 3,82,872 MT, there being negative figure of 800 MT in the books of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Trust. The bill dates, the names of the parties, the quantity and value as per shipping bills have also been mentioned. The said details are as under: M/s. Narbheram Vishram Details of exports from the Paradeep Port during the FY 2007-08 (AY 2008-09) Bill Date Party s Name Qty (MT) FOB Value as per shipping bill (Rs.) 04.04.2007 Citic Australia Commodity Trading Pvt. Ltd. 17500 43721563 27.05.2007 Visa Comtrade AG 21612 49449120 08.06.2007 Visa Comtrade AG 45630 137464299 23.06.2007 Sacvinam Global Ltd. 4811 8940762 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd. 24201 116803997 26.02.2008 Golden World Enterprise Ltd. 20000 80680320 29.03.2008 Golden World Enterprise Ltd. 11814 51779344 382872 140,27,59,111 8. Accordingly, it is seen that the appellant has been able to list out the various parties to whom export sales have been effected. There is merit in the submissions of the appellant that the assessee cannot be expected to submit a reconciliation statement, as he has submitted all the nitty-gritty details. In my considered opinion, it was the Ld. AO to call for and obtain the details of the figures offered by the PPT, so that the differences of 800 MT along with details could have been offered to the appellant for reconciliation. The details ought to have included the names and/or details of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion raising the issue of validity of the assessment made by the Assessing Officer under section 147/143(3)/153A of the Act. 6. In support of the issue raised in the Cross Objection of the assessee challenging the validity of the assessment made by the Assessing Officer under section 147/143(3)/153A of the Act, the ld. Counsel for the assessee contended that the original assessment in the assessee s case for the year under consideration was completed by the Assessing Officer under section 153A/143(3) of the Act. He submitted that the said assessment was reopened by the Assessing Officer on 17.02.2015, i.e. that the expiry of four years from the end of the relevant assessment year and as per the first proviso to section 147, such reopening after the expiry of four years from the end of the relevant assessment year was permissible only when any income chargeable to tax had escaped assessment by reason of the failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment for the relevant assessment year. He invited our attention to the reasons recorded by the Assessing Officer as given on page 2 of his paper book and submitted that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Iron Ore to the tune of 10,761 MT valued at ₹ 2,79,29,422/- (@₹ 2595.43 per MT which is arrived at taking the amount of total sales as per P L Account divided by total quantity of sales i.e. ₹ 2788508797.70/1074392.88). The assessee firm has shown production of Iron Ore of 11,74,680 MT in its statutory audited account for the F,Y, 2007-08 relevant to AY. 2008-09 whereas from the M.B, Shah Commission Report at Page No. 325, Annexure-Z, Vol.-II/A of 1st report on Odisha, it reveals that actual production of Iron Ore of the assessee company in the same period was 11,85,441 MT. Hence, the production of Iron Ore remains undisclosed in the books of account of the assessee firm, worked out to 10,761 MT valued at ₹ 2,79,29,422/- for the A.Y. 2008-09. On perusal of details on export quantity value of cargo (Iron Ore) exported from Paradeep Port received from Paradip Port Trust, Paradip Port, it is seen that the actual quantity of export of tile iron ore from Paradip Port, by the captioned assessee in FY 2007-08 relevant to AY 2008-09 was 1,28,01,37,601 MT whereas in the assessee's books of account, it is reflected as 93,64,98,243 MT. Hence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... letion by the ld. CIT(Appeals) of the addition of ₹ 2,93,18,510/- made by the Assessing Officer on account of the alleged suppression of export sales. 11. The ld. D.R. submitted that the export of iron ore by the assessee company through Paradeep Port Trust during the year under consideration as reported by the Paradeep Port Trust itself in response to the enquiry directly made by the Assessing Officer was 3,90,872 Metric Ton as against the export of 3,82,872 Metric Ton shown by the assessee company in its books of account. He submitted that this difference could not be explained satisfactorily by the assessee-company inspite of sufficient opportunity given by the Assessing Officer during the course of assessment proceedings. He contended that the onus in this regard was on the assessee to explain the difference of 8,000 Metric Ton in the export of iron ore as pointed out by the Assessing Officer from the relevant information received from Paradeep Port Trust and since the assessee had failed to discharge the said onus, the addition on account of the said difference by treating the same as suppression of export sale by the assessee was rightly made by the Assessing Offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led to support and substantiate the allegation made by him regarding suppression of export sale by the assessee and the ld. CIT(Appeals) was fully justified in deleting the addition made by the Assessing Officer on the basis of unsupported and unsubstantiated allegation regarding suppression of export sale by the assessee. 13. We have considered the rival submissions on this issue and also perused the relevant material available on record. It is observed that the relevant details of export of iron ore as made by the assessee during the year under consideration through Paradeep Port Trust were obtained by the Assessing Officer by making a direct enquiry with the Paradeep Port Trust. As reported by Paradeep Port Trust, the assessee-company had made total export of 3,90,872 Metric Ton of iron ore during the year under consideration and since the export of 3,82,872 Metric Ton was shown by the assessee in its books of account, there was a difference in export of iron ore to the extent of 8,000 Metric Ton, which the Assessing Officer required the assessee to explain. In reply, it was explained by the assessee that the export of iron ore as reported by Paradeep Port Trust was less th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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