M/s. South India Roadways, Jamshepur V. ITO, Jamshepur

CO 9/RAN/2013

• Counselvise Citation: [2013] 122 COUNSELVISE.COM (IT) 8597 (ITAT-RANCHI)
• Duration Of Justice: 16 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 01-05-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 15-04-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: V R SONBHADRA
• Assessee Lawyers: S K PODDAR
• Section: 143(3); 194C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI CIRCUI T BENCH, RANCHI (BEFORE SHRI P.K.BANSAL, HONBLE A.M.& SHR I D,T. GARASIA, HONBLE J.M.) I.T.A. NO. 01/RAN/2013 : ASSESSMENT YEAR 2005 -06 ITO, WARD-3(2), JAMSHEDPUR -VS- M/S. SOUTH IN DIA ROADWAYS, JAMSHEDPUR (APPELLANT) PAN: AASFS 5696 L (RESPONDENT) C.O.NO.09/RAN/2013 : ASSESSMENT YEAR 2005-06 (ARISING OUT OF I.T.A. NO. 01/RAN/2013) M/S. SOUTH INDIA ROADWAYS, JAMSHEDPUR -VS- ITO, WA RD-3(2), JAMSHEDPUR (CROSS OBJECTOR) (RESPONDENT) DEPARTMENT BY : SHRI V.R. SONBHADRA, D.R. ASSESSEE BY : SHRI S.K.PODDAR, C.A. DATE OF CONCLUDING THE HEARING : 01.05.2013 DATE OF PRONOUNCING THE ORDER : 01.05.2013 O R D E R PER BENCH : THIS APPEAL BY THE REVENUE AND THE CROSS OBJECTION BY THE ASSESSEE HAVE BEEN FILED AGAINST THE ORDER PASSED B Y THE COMMISSIONER OF INCOME-TAX (APPEALS), JAMSHEDPUR DATED 29/11/201 2 FOR ASSESSMENT YEAR 2005-06. 2. THE ONLY ISSUE INVOLVED IN THE APPEAL AS WELL AS C.O., WHICH IS SUPPORTIVE TO THE ORDER OF THE CIT(A), IS WHETHER T HE DISALLOWANCE CAN BE MADE UNDER SECTION 40(A)(IA) UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. BRIEF FACTS RELATING TO THIS CASE ARE THAT THE A SSESSING OFFICER NOTED THAT THE ASSESSEE IS A PARTNERSHIP FIRM ENGAG ED IN THE BUSINESS OF TRANSPORTATION, COMMISSION AND ARRANGING THE VEHICL E FOR MAIN TRANSPORTERS. THE RETURN FILED UNDER SECTION 143(3) WAS ASSESSED AT A TOTAL INCOME OF RS.1,35,900/-. SUBSEQUENTLY, THE CI T(A) INVOKING THE PROVISIONS OF SECTION 263, SET ASIDE THE ASSESSMENT AND RESTORED TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO M AKE A FRESH ASSESSMENT, AFTER MAKING APPROPRIATE INQUIRY IN REG ARD TO THE ADMISSIBILITY OF FREIGHT CHARGES CLAIMED AS DEDUCTI ON WITH REFERENCE TO PROVISIONS OF SECTION 194C R.W.SECTION 40(A)(IA) OF THE INCOME TAX ACT. THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAD M ADE THE PAYMENT AND IN ALL CASES, PAYMENTS ARE EXCEEDED RS.20,000/- AND THE AGGREGATE PAYMENTS EXCEEDED RS.50,000/-. FOR SUCH VEHICLES DU RING THE FINANCIAL YEAR, THE ASSESSEE HAS NOT DEDUCTED TAX ON THE PAYM ENTS MADE TO THE VEHICLE OWNERS. THEREFORE, THE ASSESSING OFFICER C ALCULATED THE DISALLOWANCE UNDER SECTION 40(A)(IA) TO THE EXTENT OF RS.90,99,519/-. THE ASSESSEE WENT IN APPEAL BEFORE THE CIT(A). THE CIT(A), AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND THE REMAND REPORT, DELETED THE DISALLOWANCE ON THE BASIS OF THE DECISI ON OF THE HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT-VS- UNITED RICE LAND LTD. 322 ITR 594 (P&H) HOLDING THAT IN THE ABSENCE OF ANY WRITTEN OR ORAL CONTRACT BETWEEN THE ASSESSEE AND THE PARTIES TO WHOM FREIGHT CHARGES WERE PAID, THE PROVISIONS OF SECTION 194C W OULD NOT BE APPLICABLE AND CONSEQUENTLY DISALLOWANCE OF RS.90,9 9,519/- WAS DELETED. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFU LLY CONSIDERED THE SAME. THE LD. D.R. RELIED ON THE ORDER OF THE ASSES SING OFFICER BUT COULD NOT ADDUCE OR PRODUCE ANY COGENT MATERIAL OR EVIDENCE BEFORE US WHICH MAY PROVE THAT THERE WAS ANY CONTRACT WRITTEN OR ORAL BETWEEN THE ASSESSEE AND THE TRUCK OWNERS FOR THE HIRING OF THE TRUCKS SO THAT IT MAY BE SAID THAT THE ASSESSEE IS LIABLE TO DEDUCT TAX A T SOURCE AS THE SINGLE PAYMENT EXCEEDS RS.20,000/-. THE CIT(A) HAS GIVEN T HE FINDING OF FACT AND APPLIED THE DECISION IN THE CASE OF CIT-VS- BHAGWAT I STEELS 326 ITR 108 WHEREIN THE HONBLE HIGH COURT OF PUNJAB & HARYANA HELD THAT IN THE ABSENCE OF WRITTEN OR ORAL CONTRACT FOR A SPECIFIC PERIOD, QUANTITY, PRICE OR THAT A SINGLE PAYMENT EXCEEDED RS.20,000/-, THE ASSESSEE WAS NOT TO BE REGARDED AS A DEFAULTER UNDER SECTION 194C OF THE INCOME-TAX ACT AND IN CONSEQUENCE THE DISALLOWA NCE UNDER SECTION 40(A)(IA) CANNOT BE MADE. THE REVENUE HAS GONE AGAINST THE DE CISION BEFORE THE APEX COURT AND THEREFORE, THE HONBLE SUPREME COURT DISMISSED THE SLP OF THE DEPARTMENT AS REPORTED IN 336 ITR 14 (STATUTE). EVEN THOUGH THE L D. A.R. BEFORE US CITED THE VARIOUS DECISIONS OF DIFFERENT HIGH COURTS WHICH AR E GIVEN AS UNDER: I. CIT-VS- BHAGWATI STEELS 326 ITR 108 II. CIT-VS- HARDARSHAN SINGH [2013] 30 TAXMANN.CO M 245 (DELHI) III. CIT-VS- TRUCK OPERATORS UNION 339 ITR 532 (P &H) IV. CIT-VS- GREWAL BROTHERS (2011) 240 CTR 325 (P& H) 4.1. IN ADDITION TO THIS, THE LD. A.R. RELIED ON TH E DECISION OF THE TRIBUNAL ALSO WHICH HAS TAKEN THE SAME VIEW. NO CONTRARY DECISION WAS BROUGHT TO OUR KNOWLEDGE. IN VIEW OF THIS FACT, WE ARE OF THE OPINION, THIS I S NOT A FIT CASE WHICH MAY REQUIRE OUR INTERFERENCE. HENCE, WE DISMISS THE REVENUES APPEA L. 5. SINCE WE HAVE DISMISSED THE REVENUES APPEAL, TH E CROSS OBJECTION, BEING SUPPORTIVE TO THE ORDER OF THE CIT (A), ALSO STANDS DISMISSED AS INFRUCTUOUS. 8 IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMI SSED WHEREAS THE CROSS OBJECTION FILED BY THE ASSESSEE IS ALSO DISMI SSED AS BEING INFRUCTUOUS. ORDER PRONOUNCED IN THE COURT ON 1 ST MAY, 2013. SD/- SD/- [D.T.GARASIA] [P.K.BANSAL] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 1 ST MAY, 2013 COPY OF ORDER FORWARDED TO : 1. , M/S. SOUTH INDIA ROADWAYS, JAMSHEDPUR 2. ITO, WARD-3(2), JAMSHEDPUR 3. C.I.T.(A), 4. THE .C.I.T., RANCHI 5. THE D.R., I.T.A.T., TRUE COPY, BY ORDER, [MST, SR.PS] SR. PRIVATE SECRETARY (ON T OUR) ITAT, RANCHI