9911796707
TMI Blog2025 (3) TMI 934X X X X Extracts X X X X X X X X Extracts X X X X ..... Date of Penalty Order Section of the IT Act 1 11496/2023 29.04.2023 - 143(3) 2 9763/2024 - 31.03.2024 270A 3 9827/2024 - 31.03.2024 271AAD(1)(i) 2. At the time of admission, in W.P.(MD)No.11496 of 2023, this Court has granted an order of interim stay. 3. The dispute in the present cases pertains to the Assessment Year 2021-2022. The petitioner filed its Return of Income under Section 139(1) of the IT Act for the AY 2021-2022 admitting a total income of Rs. 78,77,08,610/-. The Return of Income for the AY 2021-2022 filed by the petitioner was processed under Section 143(1), determining a total income of Rs. 78,77,08,610/-. 4. Thereafter, pursuant to Notice dated 28.06.2022 issued to the petitioner under Section 143(2) of the IT Act and a search conducted at the premises of the petitioner under Section 132 of the IT Act between 20.07.2022 and 16.09.2022, a decision was taken to finalize the assessment on 20.09.2022. 5. In view of the above, Notice under Section 153A of the IT Act was issued to the petitioner for the Assessment Years starting from 2016-2017 upto 2022-2023. The dispute in the present Writ Petitions pertains to the Assessment Year 2021-2022. 6. A Sho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er assessee's claim the same is with respect to only for 10 entries. The assessing officer is required to examine the correctness of the claim of the assessee and also, call for the details of GRN with respect to all the transactions towards purchase of sand/gravel/earth etc. (iv) The assessing officer is required to examine the details of payment made towards purchase of sand/gravel/earth through their employees as per the tally account as well as the details submitted by the assessee. The genuineness of those payments expended for the intended purpose shall be called for from the assessee and examined. (v) The assessing officer shall call for the site-wise breakup of expenses towards purchase of sand/gravel/earth from the assessee along with reconciliation of the said expenses with Tally entries viz., payment made through employees, or directly to the suppliers. (vi) The assessing officer shall call for the details of mode of payment towards purchase of sand/gravel/earth and examine the violation of provisions of Section 40A(3). (vii) The assessing officer shall call for the details of workorder/ quantum of sand/gravel/etc. utilized for each of the site along-with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the demand has been confirmed. 12. The learned counsel for the petitioner would submit that the very same officer who has passed the impugned assessment order dated 29.04.2023 has permitted the cross-examination of the persons from whom the statements were recorded for the rest of the Assessment Years i.e., 2016-2017 to 2020-2021 and 2022-2023. 13. It is further submitted that the petitioner should be given the same opportunity, as different yardsticks should not be followed for different Assessment Year. It is further submitted that the petitioner's Books of Account are maintained property and the petitioner has been mulcted with unjust demand vide Assessment Order dated 29.04.2023. 14. It is submitted that the Assessing Officer cannot solely rely on the statements of the employees of the petitioner and therefore, submitted that on this count also, the impugned Assessment Order is liable to be set aside as benefit of cross-examination has not been permitted to the petitioner. 15. The learned counsel for the petitioner would further submit that for the other six Assessment Years, the Assessing Officer has issued notices under Section 142(2A) of the Act for audit. The same e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 20. It is submitted that the expenses incurred for a sum of Rs. 67 Lakhs for labour charges are not packed with proper records and therefore, same has been disallowed. Therefore, it is submitted that the question of the petitioner permitting to cross-examine its own employees cannot be countenanced. It is submitted that the deponent namely R.Murugaperumal who is the partner of the assessee along with his father R.Ramu and own brother R.Saravanan have also confirmed the position that he will abide by the statements of employees and therefore, the impugned order does not call for any interference. 21. It is also submitted that the demand that has been confirmed vide the impugned Assessment Order is based on the incriminating material obtained during the course of search between 20.07.2022 and 16.09.2022 and the statements of the employees are corroborative in nature and that the Income Tax Department has solely relied on the statements of the exemployees. 22. In support of his submissions, the learned Senior Standing Counsel for the respondents has placed reliance on the following decisions: (i) Income Tax Officer Vs. M.Pirai Choodi reported in (2010) 15 SCC 283 (ii) Conybio He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to cross-examine the witness concerned. Be that as it may, we are of the view that, even on this particular aspect, the assessee could have gone in appeal to CIT (Appeals). The assessee has failed to avail the statutory remedy. In the circumstances, we are of the view that the High Court should not have quashed the assessment proceedings vide the impugned order. 3. Consequently, the impugned order is set aside. Liberty is granted to the assessee to move CIT (Appeals). It is made clear that the assessee herein will move CIT (Appeals) within a period of six weeks from today. 4. Accordingly, these civil appeals stand disposed of. " (ii) In the case of Conybio Healthcare (India) Pvt. Ltd. Vs. Commissioner of Customs, Chennai reported in 2023 (383) E.L.T. 434 (Mad.), the Division Bench of this Court has held as follows:- "16. W.P.No.19153 of 2008 was also disposed on 29.09.2008 (ex parte), at the time of admission, as is evident from a reading of the aforesaid order dated 29.09.2008. 17. Therefore, the Review Application filed by the respondent, the Commissioner of Customs and the miscellaneous applications for interim reliefs were rightly considered by the learned Single Judg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aneous petition is closed." (iii) In the case of Jet Unipex Vs. Commissioner of Customs, Chennai reported in 2020 (373) E.L.T. 649 (Mad.), particularly, in Paragraph Nos.58 to 61, this Court has held as under:- "58. Confirmation of demand solely based on statements recorded under Section 108 of the Customs Act, 1962 would require cross examination by the petitioner. 59. At the same time, if such statements are merely intended for corroboration of independent evidence, the cross-examination need not be allowed. 60. Therefore, it is for the 1st respondent to decide whether the statements recorded are to be solely relied for confirming the proposed demand or are relied for mere corroboration of independent evidence gathered during investigation. 61. In the case of former, mandatorily such statements would require cross-examination and without cross-examination, confirmation of demand would be contrary to the law settled by the Hon'ble Supreme Court in Andaman Timber Industries Vs CCE referred to supra." 28. The facts on record indicate that the petitioner was issued with the following Show Cause Notices dated 26.02.2023, 13.04.2023 and 22.04.2023. The petitioner had also re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed and relied upon by the respondent Department cannot be countenanced as they are petitioner's own employees. The request of the petitioner for cross examination of various suppliers and sub-contractors to whom payment were made by the petitioner also cannot be extended, if no statements have been relied upon by the respondent Department in the proposal to disallow the expenses based on the documents that were seized during the search conducted under Section 132 of the IT Act on 20.07.2022. 35. Only if statements of third parties were recorded and relied upon, the request for cross-examination of such third parties can be entertained. As far as the statements of own employees of the petitioner is concerned, unless such statements were retracted immediately after they were recorded, the statements recorded cannot be ignored. They are admissions of the petitioner. 36. In view of the above discussion, the impugned Assessment Order dated 29.04.2023 passed under Section 143(3) of the IT Act and the consequential Penalty Orders dated 31.03.2024 passed under Section 270A and 271AAD(1)(i) of the IT Act respectively are quashed and the cases are remitted back to the 1st respondent to pas ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
