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TMI Blog2020 (11) TMI 866X X X X Extracts X X X X X X X X Extracts X X X X ..... e under section 143(2) of the Act does not arise. We note that notice under section 143(2) is required when assessee has furnished his return of income under section 139 or in response to a notice under section 142(1) of the Act. Therefore, notice under section 143(2) is not required when the Tribunal has remanded the matter back to the file of Assessing Officer, with certain direction to assessee and Assessing Officer. It is abundantly clear that assessee had himself taken the responsibility to produce creditors to establish identity and creditworthiness, hence the question to issue notice under section 143(2) does not arise. During the assessment proceedings (second round) under section 143(3) r.w.s. 254 of the Act, the Assessing Officer has issued letter on 13.02.2012 to the assessee to furnish books of accounts, bank statements etc. In response to the said letter the assessee has filed documents and submissions, therefore, the principle of natural justice has been observed during the assessment stage. Therefore, the requirement to issue notice under section 143(2) does not arise. Hence, we dismiss the ground no.1 raised by the assessee. Rejection of books of accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . SAINI, ACCOUNTANT MEMBER: Captioned appeal, filed by the assessee, is directed against the order dated 12.06.2014, passed by the CIT(A), as a result of the appeal having been remanded to Assessing Officer in the matter of assessment under section 143(3) of the Income Tax Act, 1961 ( in short the Act ) for the assessment year 2005-06, for fresh adjudication, vide order dated 08.07.2011 of a Coordinate Bench of this Tribunal. Now, the assessee is in second round before this Tribunal on the same issues which were remanded back to the file of Assessing Officer by this Tribunal. The grievances raised by the assessee are as follows:- (I).Validity of addition: The learned Commissioner of Income-tax (Appeals) erred in holding that (a) issue of show cause notice was not required for making addition (b) no notice u/s.143(2) was required in case of set aside assessment. (II). Rejection of book result: On the facts and circumstances of the case and as per law, the learned Commissioner of Income-tax (Appeals) erred in rejecting book result. (III).Gross profit addition: While the learned Commissioner of Income-tax (Appeals) has deleted gross profit additio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case, the assessing officer has not issued show cause notice/notice under section 143(2) of the Act, therefore, on this ground itself, the assessee`s appeal is required to be allowed. He relied on various judgments of High Courts which relate to section 292B and section 292BB of the Act. All these judgments cited by ld Counsel spell that section 292B and section 292BB do not cure the defect if notice under section 143(2) is not issued. Therefore at this juncture, we do not discuss these judgments as these judgments do not directly relate to the issue under consideration. 5. On the other hand, Shri B.K. Panda, Departmental Representative, for the Revenue, submitted before the Bench that there is no need to issue show cause notice in case of set aside proceedings by the Tribunal, as the Tribunal has set-aside the order of the ld. CIT(A) and remitted the issue back to the file of the Assessing Officer for de novo adjudication only on four issues which were there in the original assessment order. There were no new issues during the assessment proceedings and the assessee was aware about these issues which were remitted back by the Tribunal to the file of the Assessing Officer. In fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asis of the order of the Hon'ble ITAT. The Hon'ble ITAT had given specific directions while setting-aside and restoring certain issues to the file of the Assessing Officer. The assessee was asked to furnish evidence and explanation on those issues in view of the directions of the Hon ble ITAT and the assessment order has been passed after discussing the details furnished by the assessee. Therefore, there is no infirmity in the assessment order on this ground. Consequently, ground no. 5 of the amended grounds of appeal is dismissed. Having gone through the order of ld. CIT(A), we noticed that the Tribunal had given specific direction while setting aside and restoring the matter back to the file of the Assessing Officer and the assessee was also asked to furnish documents and explanation on those issues in view of the directions of the Tribunal. The assessment order is to be passed after discussing the details/documents furnished by the assessee therefore, the assessing officer and assessee both were aware about the details/documents and directions of the Tribunal. Hence, there is no need to issue notice under section 143(2) of the Act, as the necessary instructions were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ince Ld. DR did not seriously object to this prayer of the assessee, the matter is restored back to the file of Assessing Officer for such exercise. This ground of assessee s appeal is allowed for statistical purpose. From the above order of the Tribunal, it is abundantly clear that assessee had himself taken the responsibility to produce creditors to establish identity and creditworthiness, hence the question to issue notice under section 143(2) does not arise. 9. We note that while passing order under section 143(3) r.w.s. 254 of the Act, the Assessing Officer has issued letter on 13.02.2012 to furnish books of accounts, bank statements etc. and the same were furnished by the assessee vide para 4 5 of assessment order, which are reproduced below:- 4. In the light of the above decision, letter was issued on 13.02.2012 and duly served upon the assessee asking it to furnish the books of accounts, bank accounts for verification. 5. In response, the assessee vide letter dated 23.02.2012 furnished the submission issue-wise. The same are discussed in the foregoing paras. Thus, it is clear that during the assessment proceedings (second round) under section 143(3) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... justified in confirming the addition of ₹ 7,95,000 as under:- Pyarchand Ranglal Shah (HUF) 45,000 Vipul M. Bafna 2,50,000 Niesh Jugraj Kothari 5,00,000 7,95,000 12. We have heard both the parties and carefully gone through the submissions put forth on behalf of the assessee. Learned Counsel reiterated the submissions made during the appellate proceedings. On the other hand, the Ld. DR for the Revenue has primarily reiterated the stand taken by the Assessing Officer, which we have already noted in our earlier para and is not being repeated for the sake of brevity. We note that assessee has discharged his burden by furnishing the following evidences and explanations: (i) Gift received from Nilesh Kothari of ₹ 5,00,000. The assessee submitted before us, Gift declaration (Page No.40-41 of the paper book-l), Copy of return of income (Page No.42 to 44 of the paper book-I), Copy of trading account, P. L.Account, Capital Account and Balance sheet clearly showing gift being debited in favou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wise quantity and quality of material, both for inward and outward. There are two elements of undervaluation against which the assessee is in appeal before this Tribunal. (i) The first element is undervaluation of corrugated cement sheets of ₹ 40,896/-. Ld. Counsel submits before us that the assessee has valued the inventories of 902 corrugated cement sheets as per the LIFO basis of valuing inventories and as such has valued it at ₹ 180 per sheet, however, the assessing officer has adopted higher rate of ₹ 225.34 per sheet out of two invoices of ₹ 180.27 and ₹ 225.34 as per the last bills produced before him. The assessee has maintained quantity wise and quality wise day-to-day register which is not disputed by the assessing officer. The assessee has adopted LIFO mode of valuation because these sheets when typically are piled over each other say 50-60 sheets, it results in only the last sheet inwarded as first to be taken out. These sheets were valued at ₹ 180 per sheet considering the fact that they result in unavoidable damage due to fragile nature of the sheets, sheets damaged in transit and it loses some merchandise value. (ii) The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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