M/s Mohan Impex, Kolkata V. A.C.I.T Cir - 35,kolkata., Kolkata

ITA 1008/KOL/2013

• Counselvise Citation: 100823514 RSA 2013
• Duration Of Justice: 2 year(s) 1 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-06-2015
• Appeal Filed By: Assessee
• Bench Allotted: C
• Assessment Year: 2007-2008
• Appeal Filed On: 29-04-2013
• Court: TRIBUNAL
• Department Lawyers: SANJAY SR DR
• Section: 131

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH: KOLKATA [BEFORE HON BLE SHRI B.P.JAIN, AM] I.T.A NO.1008 /KOL/2013 ASSESSMENT YEAR: 2007 - 08 M/S. MOHAN IMPEX , VS. A.C.I.T., CIRCLE - 35, KOLKATA KOLKATA (APPELLANT) ( RESPONDENT) (PAN: AAHFM 3962 C) FOR THE APPELLANT : NONE FOR THE RESPONDENT : SHRI SANJAY, SR.DR, ADDL. C.I.T. DATE OF HEARING : 03 .06 .2015. DATE OF PRONOUNCEMENT: 03 .06 .2015. ORDER THIS APPEAL OF THE ASSESSEE ARISES FROM THE ORDER OF LD.CIT(A) - XX , K OLKATA DATED 14.02.2013 FOR ASSESSMENT YEAR 2007 - 08. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : - 1. FOR THAT LEARNED COMMISSIONER OF INCOME TAX (APPEALS) SHOULD NOT HAVE CONFIRMED DISALLOWANCES OF RS.2,07,188/ - OUT OF COMMISSION PAYM ENT ON ALLEGED GROUNDS AND HE SHOULD HAVE TAKEN INTO ACCOUNT VARIOUS SUBMISSIONS AND CONTENTION MADE IN WRITTEN SUBMISSION FILED BEFORE HIM AND SHOULD HAVE DISCUSSED THE SAME. 2. FOR THAT CIT(APPEALS) HAS CONFIRMED THE DISALLOWANCES MERELY ON DOUBT AND PRE SUMPTION AND IGNORING VARIOUS SUBMISSIONS MADE AND EVIDENCES PRODUCED BEFORE HIM. 3. FOR THAT LEARNED COMMISSIONER OF INCOME TAX (APPEALS) SHOULD NOT HAVE CONFIRMED DISALLOWANCES OF RS.49015 OUT OF FORWARDING CHARGES ON ALLEGED GROUNDS AND CONSIDERING THE NATURE OF EXPENSES AND VOLUME OF BUSINESS AND THE SAID SUM OF RS.49015 BE ALLOWED AS EXPENDITURE INCURRED FOR THE PURPOSE OF BUSINESS. 3. AS REGARDS GROUND NOS. 1 AND 2 THE BRIEF FACTS OF THE CASE ARE THAT DURING THE FINANCIAL YEAR RELEVANT TO THE ASSESS MENT YEAR 2007 - 08 THE ASSESSEE HAS CLAIMED TO HAVE INCURRED EXPENSES UNDER THE HEAD COMMISSION TO THE TUNE OF RS.2,07,188/ - . DURING THE COURSE OF HEARING THE A/R OF THE ASSESSEE FILED LIST OF COMMISSION RECIPIENT AS FOLLOWS : 1) RAJNITKANT H MEHTA RS.61, 991/ - ITA NO . 1008/KOL/2013 M/S. MOHAN IMPEX A.YR. 2007 - 08 2 76 B B GANGULY STREET KOLKATA : 700 012 2) RAKESH KUMAR GOENKA RS.54,692/ - SECTOR NO.8, FARIDABAD 3)JAI JHAWAR RS.90,505/ - 25B, CAMAC STREET, KOLKATA - 700016. 3.1. THE ASSESSEE WAS ASKED TO PRODUCE THE BALANCE SHEET, PROFIT AND LOSS ACCOUNT, PROOF OF INCOME TAX RETURN AND COPY OF THE BANK STATEMENT OF ALL COMMISSION RECIPIENT BUT NO COMPLIANCE WAS MADE IN SPITE OF REPEATED ADJOURNMENTS GIVEN TO THE ASSESSEE. THE AO THEREAFTER DEPUTED THE INSPECTOR TO IDENTIFY THE SAID COMMISSION AGENT AT SL. NOS. 2 AND 3 TO VERIFY THE GENUINENESS OF THE TRANSACTIONS BUT NO SUCH PERSON WAS AVAILABLE. FROM THE LOCAL ENQUIRY IT WAS REVEALED THAT THERE WAS NO SUCH PERSON IN SUCH NAMES. ACCORDINGLY THE AO DISALLOWED THE COMMISSION PAYMENT OF RS.2,07,1 88/ - . THE LD. CIT(A) CONFIRMED THE ACTION OF AO. 4. NONE APPEARED ON BEHALF OF THE ASSESSEE. A FTER HEARING THE LD. DR AND HAVING GONE THROUGH THE FACTS OF THE CASE, I FIND THAT THE ASSESSEE HAS SUBMITTED THE NAMES AND ADDRESSES OF THE STATED COMMISSION AG ENT, WHO HAD BEEN PAID THE COMMISSION . THOUGH THE ASSESSEE HAS NOT SUBMITTED ANY DOCUMENTS TO PROVE WHETHER THE SERVICE HAS BEEN RENDERED BY THE SAID STATED COMMISSION AGENT AND NO CONFIRMATION FROM THE SAID AGENT HAD BEEN PLACED ON RECORD BEFORE ANY OF TH E AUTHORITIES BELOW. NO ONE WAS PRODUCED TO EXAMINE THEM TO PROVE THE GENUINENESS OF THE TRANSACTIONS. MOREOVER, THE INSPECTOR OF THE INCOME TAX DEPARTMENT VERIFIED FROM THE LOCAL ENQUIRY WHICH REVEALED THAT THERE WAS NO SUCH PERSONS IN SUCH NAMES IN CASE OF TWO PERSONS AS MENTIONED HEREIN ABOVE. IN SUCH CIRCUMSTANCES AND FACTS OF THE CASE THE GENUINENESS OF THE TRANSACTIONS, IDENTITY OF THE PERSON S TO WHOM THE COMMISSION STATED TO HAVE BEEN GIVEN HAS NOT BEEN EXAMINED AND REMAINED TO BE PROVED. THOUGH THE AO HAS THE POWER TO SUMMON TO MAKE SUMMONS U/S 131 OF THE ACT, WHICH POWER DOES NOT VEST ON THE ASSESSEE, WHICH IN FACT HAS NOT BEEN USED BY THE AO. HOWEVER, IN THE INTEREST OF JUSTICE I SET ASIDE THE MATTER TO THE FILE OF AO, WHO WILL ISSUE NOTICE U/S 131 OF THE ACT TO THE STATED COMMISSION AGENT AND EXAMINE THE ISSUE DE NOVO BUT AFFORDING ADEQUATE OPPORTUNITY ITA NO . 1008/KOL/2013 M/S. MOHAN IMPEX A.YR. 2007 - 08 3 OF BEING HEARD TO THE ASSESSEE. IT IS ORDERED ACCORDINGLY. THUS GROUND NOS. 1 AND 2 OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 5. AS REG ARDS GROUND NO.3 THE BRIEF FACTS OF THE CASE AS APPEARING IN AO S ORDER ARE REPRODUCED HEREIN BELOW FOR THE SAKE OF CONVENIENCE : ON PERUSAL OF THE PROFIT & LOSS ACCOUNT OF THE ASSESSEE, IT IS SEEN THAT MISCELLANEOUS EXPENSES HAS BEEN DEBITED AT RS.2,78,4 12/ - FOR THE CURRENT FINANCIAL YEAR. ON BEING ASKED DURING THE COURSE OF PROCEEDING, THE A/R OF THE ASSESSEE COULD NOT FURNISH ALL RELEVANT BILLS/ VOUCHERS TOWARDS THE CLAIM OF SUCH EXPENSES. IN ABSENCE OF FULL PROOF DOCUMENTS, THE EXTENT OF EXPENDITURE WH ICH HAVE NEXUS WITH BUSINESS NEED COULD NOT BE ASCERTAINED. MOREOVER, THE EXPENDITURE WERE SUPPORTED BY SELF MADE VOUCHERS. THE SELF MADE VOUCHERS WERE NEITHER IN ALL CASES WERE COVERED WITH PROPER NARRATION NOR THE VOUCHERS CARRIED THE SIGNATURE OF THE RE CIPIENTS OF THE PAYMENTS. THE PAYMENTS WERE MADE MOSTLY IN CASH. IN ABSENCE OF PROPER BILLS AND VOUCHERS, 20% OF THE TOTAL EXPENDITURE I.E. RS.55,682/ - IS DISALLOWED AND ADDED BACK TO THE TOTAL INCOME OF THE ASSESSEE. THE LD. CIT(A) CONFIRMED THE ACTION OF AO. 6. I HAVE HEARD THE LD. DR AND GONE THROUGH THE FACTS OF THE CASE. THE ASSESSEE HAS NOT FURNISHED ALL THE RELEVANT BILLS/VOUCHERS AND EXPENDITURE CLAIMED HAS BEEN PAID IN CASH. THE ASSESSEE HAS PRODUCED SELF MADE VOUCHERS IN THE CIRCUMSTANCES. I DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE AO, WHO HAS RIGHTLY DISALLOWED 20% OF THE EXPENDITURE CLAIMED BY THE ASSESSEE WHICH IS VERY REASONABLE AND THE LD. CIT(A) HAS ALSO CONFIRMED THE ACTION OF AO. THUS GROUND NO.3 OF THE ASSESSEE IS DISMISSED. 5. IN THE RESULT THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDE R PRONOUNCED IN THE OPEN COURT ON 03 .06 .2015. SD/ - [ B.P.JAIN ] ACCOUNTANT MEMBER DATE: 03 .06 .2015. R.G.(.P.S.) ITA NO . 1008/KOL/2013 M/S. MOHAN IMPEX A.YR. 2007 - 08 4 C OPY OF THE ORDER FORWARDED T O: 1 . M/S. MOHAN IMPEX, 33 - A, CHATTERJEE INTERNATIONAL, 14 TH FLOOR, ROOM NO.A - 4, KOLKATA - 700071. 2 A.C.I.T., CIRCLE - 35, KOLKATA. 3 . CIT(A) - XX, KOLKATA 4. CIT - KOLKATA. 5. CIT - DR, KOLKATA BENCHES, KOLKA TA TRUE COPY, BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES