Shri Aujla Saudagarsingh Tejasingh, GANDHIDHAM V. The Assistant Commissioner of Income Tax, Gandhidham Circle, GANDHIDHAM

CO 1/RJT/2012

• Counselvise Citation: [2012] 122 COUNSELVISE.COM (IT) 7737 (ITAT-RAJKOT)
• Duration Of Justice: 6 month(s) 9 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 07-09-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 06-09-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 27-02-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MK SINGH
• Section: 133(6)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBULAL; RAJKOT BENCH, RAJKOT. . .. . . .. . , , , , . .. . . .. . , , , , $ $ $ $ BEFORE SHRI T. K. SHARMA, JM AND SHRI D. K. SRIVASTAV A, AM ITA NOS.15/RJT/2012. / ASSESSMENT YEARS 2005-06 ASSISTANT COMMISSIONER OF INCOME TAX(CIRCLE), PLOT NO.20/A, SECTOR NO.4, B/H, KPT AO BUILDING, GANDHIDHAM-KUTCH. ( * / APPELLANT) VS. SHRI AUJLA SAUDAGARSINGH TEJASINGH PRO: M/S GURUNANAK BULK CARRIERS, PATEL CHAMBERS, PLOT NO.41,SECTOR NO.9, GANDHIDHAM-KUTCH. PAN:ADEPA6097L +,* / RESPONDENT CO NO.1/RJT/2012 IN ITA NOS.15/RJT/2012. / ASSESSMENT YEARS 2005-06 SHRI AUJLA SAUDAGARSINGH TEJASINGH ( * /CROSS - OBJECTOR ) VS. ASSISTANT COMMISSIONER OF INCOME TAX(CIRCLE), +,* / RESPONDENT - / REVENUE BY SHRI M.K.SINGH /- / ASSESSEE BY SHRI KALPESH DOSHI - / DATE OF HEARING 6.9.2012 - / DATE OF PRONOUNCEMENT 7..9.2012 / / / / ORDER PER T. K. SHARMA, JM THIS APPEAL OF THE REVENUE AND CROSS-OBJECTION BY THE ASSESSEE ARE AGAINST THE ORDER OF THE LD. CIT(A)-AHMEDABAD, D ATED 5.10.2011 FOR ITA NOS.15/RJT/2012. CO NO.1/RJT/2012 2 THE ASSESSMENT YEAR 2005-06. SINCE APPEAL OF THE REVEN UE AND CROSS- OBJECTION BY THE ASSESSEE WERE HEARD TOGETHER WE PROCEE D TO DECIDE THE SAME BY THIS COMMON ORDER, FOR THE SAKE OF CONVENIENC E. ITA NOS.15/RJT/2012. 2. THE GROUNDS TAKEN BY THE REVENUE ARE REPRODUCED BELOW : 1. THE LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.16,41,350/- MADE ON ACCOUNT OF BOGUS TRANSPORTATION EXPENDITURE. 2. THE LD. CIT (A) HAS ERRED IN LAW AND ON FACT IN DELETING THE ADDITION OF RS.3,64,097/- MADE ON ACCOUNT OF UN EXPLAINED SOURCE OF INCOME. 3. THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DEL ETING THE ADDITION OF RS.3,43,066/- MADE ON ACCOUNT OF SUPPRESSION OF RECEIPTS. CO NO.1/RJT/2012 ONLY GROUND TAKEN BY THE ASSESSEE IN HIS CROSS-OBJECTION READS AS UNDER : 1. THAT THE HONBLE CIT(A) HAS WRONGLY CONFIRMED THE ADDITION FOR BOGUS TRANSPORTATION EXPENDITURE OF RS.1,38,816/- 3. BRIEF FACTS RELATING TO CONTROVERSY RAISED IN GROUN D NO.1 OF THE REVENUES APPEAL AND ONLY GROUND OF CROSS-OBJECTION FIL ED BY THE ASSESSEE ARE THAT IN THE ASSESSMENT ORDER THE AO DISALLO WED TRANSPORTATION EXPENDITURE AMOUNTING TO RS.16,41,35 0/-. THE ASSESSEE IS AN INDIVIDUAL AND ENGAGED IN THE BUSINESS OF TRANSP ORTATION UNDER HIS PROPRIETARY CONCERN I.E. M/S GURUNANAK BULK CARRIERS. THE AO ISSUED NOTICES U/S 133(6) OF THE INCOME TAX ACT, 1961 (THE ACT) TO THE PARTIES TO ITA NOS.15/RJT/2012. CO NO.1/RJT/2012 3 WHOM THE ASSESSEE CLAIMED TO HAVE PAID THE TRANSPORTATI ON CHARES. IN RESPECT OF TWO PARTIES THE NOTICES WERE RETURNED UN-SERVE D. IN RESPECT OF OTHER TWO PARTIES, THE AO FOUND THAT THERE WAS A DIFF ERENCE OF RS.1,38,816/- IN THE BOOKS OF ACCOUNT. ON THE BASIS OF THIS, THE AO DISALLOWED TRANSPORTATION CHARGES CLAIMED TO THE EXTENT OF RS.16,41,350/- 4. ON APPEAL, BEFORE THE LD. CIT(A), THE ASSESSEE CONTE NDED THAT THE FIRST TWO PARTIES WERE ASSESSED TO TAX, TAX WAS DEDUCTED ON PAYMENT MADE TO THEM. BOTH PARTIES CLAIMED TDS IN THEIR RET URN OF INCOME AND CONFIRMATION LETTERS WERE ALSO FILED FROM THEM. IN T HE SECOND REMAND REPORT DATED 16.5.2011, ONE OF THE TWO PARTIES APPEA RED BEFORE THE AO AND ACCEPTED THE TRANSACTIONS WITH THE ASSESSEE. ON THIS B ASIS, THE LD. CIT(A) DELETED THE ADDITION OF RS.15,02,534/-(921124 +581410) AND UPHELD THE BALANCE DISALLOWANCE OF RS.1,38,816/-. 5. AT THE TIME OF HEARING, BEFORE US, SHRI M.K.SING H, THE LD. DR COULD NOT POINT OUT ANYTHING AS TO WHY THE DECISION OF THE LD. CIT(A) IS NOT ACCEPTABLE. HE MERELY RELIED ON THE REASONING GIVEN BY THE AO IN THE ASSESSMENT ORDER. AS AGAINST THIS, THE LD.COUNSEL FOR THE A SSESSEE SUBMITTED THAT THE LD. CIT(A) CALLED THE REMAND REPOR T AND ON BEING SATISFIED THAT THE PARTIES TO WHOM THE ASSESSEE HAS PAID TRANSPORTATION CHARGES ARE ASSESSED TO TAX WITH THE SAME AO, HAS DULY DE CLARED THE TRANSPORTATION CHARGES IN THEIR RESPECTIVE RETURN OF I NCOME, THEREFORE, THE VIEW TAKEN BY THE LD. CIT(A) BE UPHELD. 6. HAVING HEARD BOTH SIDES, WE HAVE CAREFULLY GONE TH ROUGH THE ORDERS OF AUTHORITIES BELOW. IT IS PERTINENT TO KNOW THAT BOTH THE PARTIES TO WHOM THE ASSESSEE HAS PAID TRANSPORTATION CHARGES OF RS.15 ,02,530/- ITA NOS.15/RJT/2012. CO NO.1/RJT/2012 4 ARE ASSESSED TO TAX WITH THE SAME AO WHO HAS ASSESSED THE PA RTIES AND ASSESSEE. BOTH THE TRANSPORTERS TO WHOM TRANSPORTATION CHA RGES ARE PAID HAVE DULY DECLARED IN THE RETURN OF INCOME THE TRAN SPORTATION CHARGES RECEIVED FROM THE ASSESSEE. THE ASSESSEE HAS ALSO DEDUCTE D THE TAX AT SOURCE AT APPLICABLE RATE. IN THIS VIEW OF THE MATTER, WE ARE OF THE VIEW THAT THE LD. CIT(A) HAS GIVEN COGENT REASON FOR DELET ING THE TRANSPORTATION CHARGES TO THE EXTENT OF RS.15,02,534/-. WE, THEREFOR E, INCLINED TO UPHELD THE VIEW TAKEN BY THE LD. CIT(A). GROUND NO.1 OF THE REVENUES APPEAL IS, ACCORDINGLY DISMISSED. 7. IN RESPECT OF DIFFERENCE IN BOOKS OF ACCOUNT AMOUNTIN G TO RS.1,38,816/-. NEITHER BEFORE THE CIT(A) NOR BEFOR E US ANY OF THE DEPARTMENTAL AUTHORITIES COULD RECONCILE THE DIFFERENCE . THEREFORE, IN OUR VIEW, THE DISALLOWANCE OF TRANSPORTATION CHARGES TO THE EXTENT OF RS.1,38,816/- HAS RIGHTLY BEEN UPHELD BY THE LD. CI T(A). THE GROUND TAKEN IN THE CROSS-OBJECTION BY THE ASSESSEE IS DISMISSED. 8. THE BRIEF FACTS RELATING TO CONTROVERSY RAISED IN G ROUND NO.2 ARE IN RESPECT OF THE ALLIANCE CARGO MOVERS, DURING THE COURSE OF ASSESSMENT PROCEEDINGS, BEFORE THE AO, THE ASSESSEE STATED THAT TRA NSPORTATION CHARGES WERE PAID AMOUNTING TO RS.2,38,389/- BUT RE PLY TO NOTICE U/S 133(6), THE ASSESSEE CONTENDED THAT THE IT HAD RAISED BIL LS OF RS.6,02,486/-. THEREFORE, THE AO WAS OF THE VIEW THA T THE ASSESSEE PAID THE DIFFERENCE OF RS.3,64,097/- OUT OF BOOKS AND WITHOU T ANY SATISFACTORY EXPLANATION, HE ADDED THE SAME TO THE TOTAL INCOME O F THE ASSESSEE. ITA NOS.15/RJT/2012. CO NO.1/RJT/2012 5 9. BEFORE THE LD. CIT(A), THE LD.COUNSEL FOR THE ASSE SSEE SUBMITTED THAT THERE WAS AN OPENING BALANCE OF RS.2,24,434/- A S ON 1.4.2004, THEREFORE, THE AMOUNT IS MORE IN THE LEDGER ACCOUNT OF THE SAID PARTY. THE ASSESSEE SUBMITTED DETAILED IN RESPECT OF THE DIFFERENCE OF RS.2,24,434/-. THE ASSESSEE SUBMITTED THAT IT HAS MAINTAINED ACCOUNTS ON TRUCK WISE BASIS THEREFORE SOME OF THE DETAILS COULD NOT BE RECON CILED. THE ASSESSEE IS MAINTAINING ALL THE TRANSACTIONS AND THEREFORE THER E IS NO QUESTION OF MAKING ADDITION ON THIS ACCOUNT. 10. THE LD. CIT(A) AFTER HEARING THE LD. COUNSEL AN D ON PERUSAL OF THE RECORDS SATISFIED WITH THE EXPLANATION GIVEN BY THE ASS ESSEE THAT THE DIFFERENCE IS DULY RECONCILED AND ACCORDINGLY HE DELETED THE ADDITION MADE BY THE AO ON THIS ACCOUNT. AGGRIEVED BY THE ORDER O F THE LD. CIT(A), THE REVENUE IS IN APPEAL BEFORE US. 11. AT THE TIME OF HEARING BEFORE, ONLY OBJECTION OF THE REVENUE IS THAT THE AO WAS NOT ALLOWED OPPORTUNITY TO VERIFY THE DE TAILS BEFORE DELETING THE ADDITION. AS AGAINST THIS THE COUNSEL FOR THE ASSESS EE SUBMITTED THAT HE HAS NO OBJECTION IF THE MATTER IS REMITTED TO THE F ILE OF THE AO FOR VERIFICATION. IN THIS VIEW OF THE MATTER, WE SET ASID E THE ORDER OF LD. CIT(A) ON THIS ISSUE AND RESTORED THE ADDITION TO THE FILE OF THE AO WITH THE DIRECTION THAT THE ASSESSEE SHALL FURNISH ALL THE DETAILS ALONG WITH THE RE- CONCILIATION TO THE AO FOR VERIFICATION. THE AO WILL VERIFY THE SAME AND RE- ADJUDICATE THIS ADDITION AFRESH IN ACCORDANCE WITH LAW. THIS GROUND IS ALLOWED FOR STATISTICAL PURPOSE ITA NOS.15/RJT/2012. CO NO.1/RJT/2012 6 12. WITH REGARD TO THE GROUND NO.3 TAKEN BY THE REVE NUE THE FACTS ARE THAT THE AO OBSERVED THAT THE ASSESSEE HAS SHOWN L ESS RECEIPTS AS PER THE TDS CERTIFICATES AND RECEIPTS AS PER THE PROF IT AND LOSS ACCOUNT. THE DETAILS OF PARTIES AND AMOUNTS HAVE BEEN INCORPO RATED AT PAGE 2 ASSESSMENT ORDER. ACCORDINGLY THE AO ISSUED NOTICE TO THE ASSESSEE TO SHOW CAUSE AS TO WHY THE DIFFERENCE BETWEEN THE TDS CERT IFICATE AND P&L ACCOUNT AMOUNTING TO RS.3,43,066/- SHOULD NOT BE ADDE D BACK TO THE TOTAL INCOME. THE ASSESSEE DID NOT COMPLY WITH THE NOT ICE OF THE AO AND HENCE THE AO ADDED THE SUM OF RS.3,43,066/- BEING DI FFERENCE OF TDS CERTIFICATE AND P&L ACCOUNT. 13. BEFORE THE LD. CIT(A) THE LD.COUNSEL OF THE ASSESSEE SUBMITTED PARTY-WISE DETAILS WHICH IS FORMING PART OF APPELLATE O RDER AT PAGES 19 TO 25 AND ON BEING SATISFIED WITH THE EXPLANATION HE DI RECTED THE AO TO VERIFY THE CONTENTION AND MODIFY THE ORDER ACCORDINGLY AND S UBJECT TO VERIFICATION HE ALLOWED THE GROUND OF THE ASSESSEE. 14. AT THE TIME OF HEARING, THE LD. DR COULD NOT BR ING ANY MATERIAL CONTRARY TO THE FINDING OF THE LD. CIT(A), EXCEPT MER ELY TO SUPPORT THE ORDER OF THE AO. 15. ON THE OTHER HAND, THE LD.COUNSEL FOR THE ASSESSEE R ELIED ON THE ORDER OF THE LD. CIT(A) AND CONTENDED THAT THE LD. C IT(A) HAS PASSED A REASONED ORDER AND HENCE THE GROUND TAKEN BY THE RE VENUE BE DISMISSED. 16. WE FIND THAT THE ASSESSEE HAS GIVEN DETAILS REGARDI NG NAME OF PARTY, RECEIPTS AS PER TDS CERTIFICATE AND P&L ACCOUNT AND DIFFERENCE ITA NOS.15/RJT/2012. CO NO.1/RJT/2012 7 BETWEEN THEM AND REASONS FOR DIFFERENCE. WE FIND THAT THE LD. CIT(A) AFTER TAKING INTO CONSIDERATION DIRECTED THE AO TO VERIFY THE DETAILS AND ADJUDICATE THE MATER. ACCORDINGLY, THE LD.CIT(A) HAS A LLOWED THE GROUND TAKEN BY THE ASSESSEE. WE ALSO FIND THAT THE ASSESSEE HAS G IVEN RELEVANT DETAILS IN RESPECT OF SUPPRESSED RECEIPT AND LD. CIT(A) CORRECTLY APPRECIATED THE FACTS AND DIRECTED THE AO TO TAKE FRESH DECISION. IN THIS VIEW OF THE MATTER, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD.CIT(A). WE CONFIRM THE SAME. THE GROUND NO.3 TAKEN BY THE RE VENUE IS, THEREFORE, DISMISSED. 17. IN THE RESULT, THE APPEAL OF THE REVENUE IS PA RTLY ALLOWED AND CROSS-OBJECTION FILED BY THE ASSESSEE IS DISMISSED. THIS ORDER IS PRONOUNCED IN THE OPEN COURT ON THE DAT E MENTIONED HEREINABOVE. SD SD ( .. / D. K. SRIVASTAVA) ( .. / T. K. SHARMA) / ACCOUNTANT MEMBER /JUDICIAL MEMBER 3/ ORDER DATE : 7.9.2012 /RAJKOT SRL - -- - +4 +4 +4 [phone] / COPY OF ORDER FORWARDED TO:- 1. * / APPELLANT-. 2. +,* / RESPONDENT- 3. : / CONCERNED CIT. 4. :- / CIT (A). 5. 4 +, , / DR, ITAT, RAJKOT 6. / GUARD FILE. / BY ORDER , TRUE COPY SENIOR PRIVATE SECRETARY , INCOME TAX APPELLATE TRIBUNAL, RAJKOT.