ACIT, CHENNAI V. M/s. Maris Enterprises Pvt Ltd., CHENNAI

ITA 1019/CHNY/2011

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 2377 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 9 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-04-2013
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 01-04-2013
• Assessment Year: 2005-2006
• Appeal Filed On: 06-06-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: T N BETGIRI
• Keywords: Depreciation; Additional evidence
• Section: 194C; 2

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL C BENCH, CHENNAI. BEFORE DR. O.K. NARAYANAN, VICE-PRESIDENT & SHRI S.S. GODARA, JUDICIAL MEMBER I.T.A. NO.1019/MDS/2011 ASSESSMENT YEAR : 2005-06 THE ASSISTANT COMMISSIONER OF INCOME TAX, COMPANY CIRCLE IV (1), CHENNAI. VS. M/S. MARIS ENTERPRISES PVT. LTD., NO. 784, ANNA SALAI, CHENNAI 35. [PAN:AAACM3419N] (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI T.N. BETGIRI, JCIT RESPONDENT BY : NONE DATE OF HEARING : 01 . 0 4 .201 3 DATE OF PRONOUNCEMENT : 01.04.2013 ORDER PER S.S. GODARA, JUDICIAL MEMBER THIS REVENUES APPEAL IS DIRECTED AGAINST THE ORDE R OF THE COMMISSIONER OF INCOME TAX (APPEALS) -V, CHENNAI DA TED 31.03.2011; IN ITA NO. 299/07-08, FOR ASSESSMENT YEAR 2005-06; IN PROCEEDINGS UNDER SECTION 246A OF THE INCOME TAX ACT 1961 [IN SHORT T HE ACT]. 2. IN THE COURSE OF HEARING, THE DR REPRESENTING R EVENUE VEHEMENTLY ARGUES THAT THE CIT(A) HAS WRONGLY DELETED THE ADDI TION MADE BY THE ASSESSING OFFICER UNDER THE HEADS CONSTRUCTION EX PENSES OF ` .19,89,813/-, COMMON EXPENSES OF ` .5.00 LAKHS, DEPRECIATION OF ` .2,65,600/- AND THAT I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1019 1019 1019 1019/M/ /M/ /M/ /M/11 1111 11 2 MADE UNDER SECTION 40A(IA) OF THE ACT FOR NON-DED UCTION OF TDS UNDER SECTION 194C REGARDING PAYMENTS MADE TO CONTRACTOR AND SUB-CONTRACTOR OF ` .9,41,390/- IN VIOLATION OF RULE 46A OF THE INCOME TAX RULES. HE FURTHER SUBMITS THAT THE CIT(A) HAS ALLOWED THE ASSESSEES PRAYER TO LEAD AND PRODUCE ADDITIONAL EVIDENCE WITHOUT ASSOCIATING THE ASSESSING OFFICER. IN THE LIGHT THEREOF, HE PRAYS FOR ACCEPTANCE OF THE APPEA L. 3. DESPITE HAVING BEEN SENT NOTICE, NO REPRESENTAT ION HAS COME ON BEHALF OF THE ASSESSEE. THEREFORE, IT IS PROCEEDED EX-PARTE. 4. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE I S A COMPANY ENGAGED IN THE BUSINESS OF CONSTRUCTION, RUNNING/SUB-LETTING O F RESTAURANT, GENERATION AND DISTRIBUTION OF ELECTRICITY. ON 29.10.2005, IT HAD FILED ITS RETURN DISCLOSING INCOME OF ` . NIL. THEREAFTER, THE ASSESSING OFFICER FINALIZED SCRUTINY ASSESSMENT VIDE ORDER DATED 18.12.2007 MAKING DISAL LOWANCES/ADDITIONS OF ` .19,89,313/- AS CONSTRUCTION EXPENSES, ` .5.00 LAKHS AS SHARE OR COMMON EXPENSES, DEPRECIATION ON WINDMILL OF ` .2,65,600/- AND LABOUR CHARGES OF ` .9,41,390/- FOR NON-DEDUCTION OF TDS TOTALING TO ` .36,96,803/-. 5. AGGRIEVED, THE ASSESSEE PREFERRED APPEAL. WE FI ND FROM THE ORDER UNDER CHALLENGE THAT IN THE LOWER APPELLATE PROCEED INGS BEFORE THE CIT(A), IT CHOSE TO SUBMIT COPY OF THE LEDGER/CONTRACT RECEIPT QUA THE CONSTRUCTION EXPENSES, COPY OF ITS RESOLUTION OF BOARD OF DIRECT ORS REGARDING SHARED OR I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1019 1019 1019 1019/M/ /M/ /M/ /M/11 1111 11 3 COMMON EXPENSES AND LEDGER EXTRACT QUA NON-DEDUCTIO N OF TDS IN SUPPORT OF ITS SUBMISSIONS. IT IS EVIDENT THAT BEFORE DELET ING THE ADDITIONS AFORESAID BY PLACING RELIANCE ON AFORESAID MATERIAL, THE CIT( A) HAS NOT GRANTED ANY OPPORTUNITY TO THE ASSESSING OFFICER. IN OUR OPINIO N, THIS AMOUNT TO VIOLATION OF RULE 46A OF THE INCOME TAX RULES MANDATING THAT BEFORE ANY ADDITIONAL EVIDENCE IS LED BY ANY PARTY, THE OTHER SIDE HAS TO BE GRANTED AN OPPORTUNITY TO REBUT THE SAME. IN THIS VIEW OF MATTER AND IN TH E LARGER INTEREST OF JUSTICE, WE DEEM IT APPROPRIATE THAT THE MATTER REQUIRES REC ONSIDERATION BY THE ASSESSING OFFICER. THEREFORE, WE RESTORE THE ISSUES INVOLVED HEREIN BACK TO THE FILE OF THE ASSESSING AUTHORITY, WHO SHALL DECI DE THEM AFRESH AFTER GRANTING ADEQUATE OPPORTUNITY OF HEARING TO THE ASS ESSEE. 6. ACCORDINGLY, THE APPEAL IS ALLOWED FOR STATISTI CAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF H EARING ON MONDAY, THE 1 ST OF APRIL, 2013 AT CHENNAI. SD/ - SD/ - (DR. O.K. NARAYANAN) VICE-PRESIDENT (S.S. GODARA) JUDICIAL MEMBER CHENNAI, DATED, THE 01.04.2013 VM/- TO: THE ASSESSEE//A.O./CIT(A)/CIT/D.R.