WHITELINE CHEMICALS Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) THE assessee is in appeal against the judgment of the ITAT, Dated 16.11.2011.

(2.) WHILE issuing notice on 03.12.2012, we have made following observations,

(3.) THE revenue had questioned the order of CIT(Appeals), dated : 11.10.2004, before the Tribunal in which the CIT (Appeals) had deleted the addition of Rs.18,83,000/ -(rounded off) under Section 69C of the Act. Before the Tribunal the assessee contended that the transaction with M/s. Swami Chemicals, totaling to Rs.18,83,613/ - was only a paper transaction and there was no real sell of the goods. The payments were received from Swami Chemicals and after deducting three per cent as Sales Tax, balance amount was returned to Swamy Chemicals. In this context, the Tribunal observed that the CIT(Appeals) had not properly appreciated the issue. If, the assessee had retained three percent towards Sales Tax and deposited it with the Government, no addition would be warranted. However, in the event, if, the said three per cent remained with the assessee to that extent, the same would form the part of the income of the assessee. On such basis, the Tribunal remanded the proceedings before the CIT(Appeals) "to decide the matter afresh, in accordance with law, keeping in view the above observations and after affording the reasonable opportunity of hearing to both the sides."