Sri Santosh B. Rattu., Belgaum V. Income Tax Officer Ward-2 (1), Belgaum

ITA 1/PAN/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 93482 (ITAT-PANAJI)
• Duration Of Justice: 1 year(s) 5 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-06-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 16-06-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 03-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MEHBOOB ALI KHAN
• Assessee Lawyers: ASHOK A KULKARNI

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH, PANAJI BEFORE SHRI GEORGE MATHAN , HONBLE JUDICIAL MEMBER AND SHRI N.K. BILLAIYA , HONBLE ACCOUNTANT MEMBER ITA NO. 01 /PNJ/2014 (ASST. YEAR : 200 6 - 0 7 ) SRI SANTOSH B. RATTU, 217, HINDAWADI, BELGAUM. VS. ITO , WARD - 2(1), BELGAUM . PAN NO. ABVPR 6703 R (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI ASHOK A. KULKARNI ADV. DEPARTMENT BY : SHRI MEHBOOB ALI KHAN - D.R. DATE OF HEARING : 16 / 0 6 /2015 . DATE OF PRONOUNCEMENT : 16 / 0 6 /201 5 . O R D E R PER N.K. BILLAIYA THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST THE ORDER OF L D.CIT (A), BELGAUM , DATED 01 / 11 /201 3 PERTAINING TO A.Y. 200 6 - 0 7 . 2. THE SUM AND SUBSTANCE OF THE GRIEVANCE OF THE ASSESSEE IS THAT LD.CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE MADE U/S. 40(A)(IA) OF THE ACT. 2 ITA NO. 01 /PNJ/2014 3. ASSESSEE IS A TRANSPORTER FOLLOWING MERCANTILE SYSTEM OF ACCOUNTING. RETURN WAS SELECTED FOR SCRUTINY ASSESSMENT. THE ASSESSEE OWNS 05 TRUCKS AND ALSO HIRE S TRUCKS ON HIRE BASIS FOR PROVIDING TRANSPORTATION TO HIS CLIENTS. WHILE SCRUTINIZING THE RETURN OF INCOME, THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAS MADE PAYMENTS TOTALLING TO RS. 86,39,183/ - WITHOUT DEDUCTING TAX AT SOURCE. ASSESSEE WAS ASKED TO EXPLAIN HIS STAND . IT WAS EXPLAINED THAT EACH OF THE TRUCK OWNERS DO NOT HAVE MORE THAN 02 TRUCKS. THE ASSESSING OFFICER ASKED THE ASSESSEE TO FURNISH EVIDENCE THAT EACH OF THE TRUCK OWNERS DO NOT OWN MORE THAN 02 TRUCKS. THE ASSESSING OFFICER DID NOT BELIEVE IN ASSESSEES CONTENTION FINDING THAT THE ASSESSEE HAS NOT OBTAINED ANY DECLARATION IN FORM NO. 15 - I . THE ASSESSING OFFICER DISALLOWED RS. 74,09,157/ - 4 . THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) AND FUR NISHED THE FORM NO. 15 - I. LD. CIT(A) ACCEPTED THE DECLARATIONS OF THE ASSESSEE AND DIRECTED FOR DELETION OF ADDITION OF RS. 74,09,157/ - MADE BY THE ASSESSING OFFICER U/S. 40(A)(IA) OF THE ACT. REVENUE TOOK THE MATTER BEFORE THE TRIBUNAL AND THE TRIBUNAL VIDE ITS ORDER DATED 11/04/ 2011 IN I.T.A.NO. 35/PNJ/2010, SET ASIDE 3 ITA NO. 01 /PNJ/2014 THE ISSUE OF DISALLOWANCE OF RS. 74,09,157/ - U/S. 40(A)(IA) OF THE ACT CONSIDERING THE FACT THAT THE ASSESSEE HAS PRODUCED ADDITIONAL E VIDENCE BEFORE THE LD. CIT(A) AND THE LD. CIT(A) FAILED IN GIVING A FRESH OPPORTUNITY TO THE ASSESSING OFFICER AS REQUIRED U/S. 46A OF THE ACT. PURSUANT TO THE DIRECTION OF THE TRIBUNAL, THE ASSESSING OFFICER ISSUED NOTICE TO THE ASSESSEE. THE ASSESSEE SUBMITTED DECLARATION IN FORM NO. 15 - I . THE ASSESSEE ALSO SUBMITTED THAT ALL THESE FORMS WERE FORWARDED TO CIT(TDS). THE ASSESSING OFFICER OBSERVED THAT FORM NO. 15 - I IS NOT SIGNED BY THE PAYEE S ON OR BEFORE 31/03/2006 . THUS, THE ASSESSING OFFICER WAS OF THE FIRM BELIEF THAT FORM N O .15 - I WERE NEVER OBTAINED BY THE ASSESSEE BEFORE CLOS ING OF THE ACCOUNTING YEAR. THE ASSESSING OFFICER ONCE A GAIN MADE THE DISALLOWANCE U/S. 40(A)(IA) OF THE ACT. AGGRIEVED BY THIS, ASSESSEE CARRIED THE MATTER BEFORE THE LD.CIT(A), BUT WITHOUT ANY SUCCESS. 5. BEFORE US, COUNSEL FOR THE ASSESSEE AT THE VERY OUTSET STATED THAT THE PAYMENTS WERE MADE DURING THE ACCOUNTING YEAR ITSELF , NO AMOUNT IS PAYABLE ON THE LAST DAY OF THE ACCOUNTING YEAR. THEREFORE, THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE BY THE DECISION OF THE HONBLE ALLAHABAD HIGH COURT IN THE CASE OF CIT VS. VECTOR SHIPPING SERVICES (P) LTD. (357 ITR 642) . 4 ITA NO. 01 /PNJ/2014 6. PER CONTRA , LEARNED DR STATED THAT THIS ISSUE HAS BEEN RAISED FOR THE FIRST TIME BY THE ASSESSEE AND THE ASSESSING OFFICER HAS NOWHERE MENTIONED THAT THE AMOUNTS HAVE BEEN PAID DURING THE YEAR S UNDER CONS IDERATION ITSELF. 7. WE HAVE HEARD RIVAL CONTENTIONS AND HAVE CAREFULLY PERUSED THE ORDERS OF THE AUTHORITIES BELOW. NOW THE ISSUE BEFORE US IS WHETHER THE ASSESSEE HAS ACTUALLY MADE THE PAYMENTS DURING THE YEAR UNDER CONSIDERATION ITSELF AND NO AMOUNT IS PAYABLE ON THE LAST DAY OF THE AC COUNTING YEAR . IF THAT IS SO, THEN THE RATIO LAID DOWN BY THE HONBLE ALLAHABAD HIGH COURT IN THE CASE OF VECTOR SHIPPING SERVICES (P) LTD . (SUPRA) WOULD SQUARELY APPLY ON THE FACTS OF THE CASE, BUT WE FIND THAT THE FACTS ARE NOT BEFORE US. THEREFORE, IN THE INTEREST OF JUSTICE AND FAIR PLAY, WE RESTOR E THIS ISSUE TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSING OFFICER IS DIRECTED TO VERIFY WHETHER THE PAYMENT OF FREIGHT TO THE TRANSPORTERS HAVE ACTUALLY BEEN MADE DURING THE YEAR ITSELF AND NO AMOUNT IS OUTSTANDING ON THE LAST DAY OF THE ACCOUNTING YEAR. IF THE ASSESSING OFFICER FINDS THAT THERE IS NO OUTSTANDING ON THE LAST DAY OF THE ACCOUNTING YEAR, NO ADDITION IS CALLED FOR . HOWEVER, I F SOME AMOUNT IS FOUND TO BE PAYABLE ON THE LAST DAY OF THE ACCOUNTING YEAR, THEN THE ADDITION SHOULD BE MADE ONLY TO THAT EXTENT . THE ASSESSEE IS DIRECTED TO FURNISH NECESSARY DETAILS. 5 ITA NO. 01 /PNJ/2014 8. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSE S. ( ORDER PRONOUNCED IN THE OPEN COURT ON 1 6 TH JUNE , 201 5 ). S D / - S D / - ( GEORGE MATHAN ) ( N.K. BILLA I YA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 1 7 T H JUNE , 201 5 . VR/ - COPY TO: 1 . THE APPELLANT 2 . THE RESPONDENT 3 . THE LD. CIT 4 . THE CIT(A) 5 . THE D.R 6 . GUARD FILE. BY ORDER ASSISTANT REGISTRAR I.T.A.T., PANAJI 6 ITA NO. 01 /PNJ/2014 DATE INITIAL ORIGINAL DICTATION PAD IS ENCLOSED IN THE FILE 1. DRAFT DICTATED ON 1 6 .06.2015 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 1 6 .06.2015 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 1 7 /06/2015 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 1 7 /06/2015 JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 1 7 /06/2015 SR.PS 6. DATE OF PRONOUNCEMENT 1 6 /06/2015 SR.PS 7. FILE SENT TO THE BENCH CLERK 17 /06/2015 SR.PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER