The ITO, Ward-7(2), Ahmedabad V. Shri Sitarambhai I.Patel, Ahmedabad

ITA 1114/AHD/2007

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 6083 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 2 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 06-05-2010
• Assessment Year: 2003-2004
• Appeal Filed On: 15-03-2007
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHRIM C PANDITSR

Judgement Text

-1- INTHEINCOMETAXAPPELLATETRIBUNAL AHMEDABADBENCHCAHMEDABAD BEFORES/SHRIT.K.SHARMA,JMANDD.C.AGRAWAL,AM INCOME-TAXOFFICER, WD7(2),AHMEDABAD. V/S . SHRISITARAMBHAII PATEL,PROP.MURLIDHAR TRADERS,6ADESHAPTS., JODHPUR,AHMEDABAD. (APPELLANT) .. (RESPONDENT) APPELLANTBY:- SHRIM.C.PANDIT,SR.D.R. RESPONDENTBY:- NONE ORDER PERD.C.AGRAWAL,ACCOUNTANTMEMBER. THISISANAPPEALFILEDBYTHEREVENUERAISINGFOL LOWINGGROUNDS:- 1.THELD.COMMISSIONEROFINCOMETAX(A) - XIII,AHMEDABAD HASERREDINTAWANDONFACTSINDELETINGTHEADDIT IONMADEOF RS. 11,77,097/-BEING THE OUTSTANDING AMOUNT OF FREI GHT CHARGESPAYABLETOVARIOUSCARTINGCONTRACTORS. 2.THE LD.COMMISSIONEROFINCOMETAX(A)-XIII,AHMEDABA D HASERREDINLAWANDONFACTSINDELETINGTHEADDIT IONOFRS. 1,95,672/- ON ACCOUNT OF DISALLOWANCE MADE UNDER SECTION 4QA(2)FB)OFTHEINCOMETAXACT,1961OFCARTINGCH ARGESPAID TOASSESSEE'SWIFEATAHIGHERRATE. 3. ON THEFACTSANDINTHECIRCUMSTANCESOFTHE CASE, THELD, COMMISSIONEROFINCOMETAX(A)-XIII,AHMEDOBADOUG HTTO HAVEUPHELDTHEORDER OF THEASSESSINGOFFICER. ITANO.1114/AHD/2007 ASST.YEAR:2003-04 2 4. IT IS THEREFORE PRAYED THAT THE ORDER OF THE LD. COMMISSIONEROFINCOMETAX(A)-XIII R AHMEDABADMAYBESET ASIDEANDTHATOFTHEASSESSINGOFFICERBERESTORED . 2. THE FACTS OF THE CASE ARE THAT ASSESSEE IS A PRO PRIETOR OF M/S MURLIDHARTRADERSDEALINGINTRANSPORTATION/CASTING /TRADINGOFKAPACHI. THEASSESSEEFILEDRETURNOFINCOMEDECLARINGINCOM EOFRS.2,91,458/-. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE AO NOTICED THAT ASSESSEEHASMADEPAYMENTOFRS.11,77,097/-UNDER THEHEADCARTING. THESEPAYMENTSWEREMADETOTHEFOLLOWINGPARTIES: - SL.NO. NAME BALANCEOUTSTANDING 1. BIPINBHAIJAYSWAL 61,522.45 2. CHIRAGN.PATEL 6,13,595.95 3. H.M.RABARI 85,836.00 4. M.V.RABARI 1,16,825.00 5. SHAILA.LADHANI 2,99,317.72 THEAOCALLEDFORTHEDETAILSOFTHESEPARTIESAND FOUNDTHATASSESSEE COULDNOTSUPPLYTHEPANOFTHEPERSONSTOWHOMSUC HPAYMENTSWERE MADE.THEYWEREALSONOTPRODUCEDFORVERIFICATION. ASAMPLESCRUTINYOF THEBILLSRAISEDBYSHRIBIPINJAYSWALINDICATEDTH ATTHEBILLSDIDNOTHAVE PRINTEDNUMBERSANDTHEYWEREUNSIGNEDBYTHEBILL RAISER.THEASSESSEE DIDNOTMAKEANYPAYMENTTOHIMDURINGTHEENTIREY EAR.FROMTHISTHE AOINFERREDTHATASSESSEEHADCREATEDBOGUSCREDITO RSANDBOGUSBILLSARE RAISEDTOEVADETHETAX. 3 3. LD. CIT(A) DELETED THE ADDITION BY MAKING THE FO LLOWING OBSERVATIONS:- (1) OUTOFTOTALCARTINGEXPENSESCLAIMEDATRS.13, 44,044/-THEAO ALLOWED THE CLAIM ONLY AT RS.1,66,947/- ON ACTUAL P AYMENT BASIS. THEREFORE,IFPARTPAYMENTISGENUINETHENOTHERPA YMENTWOULDALSOBE GENUINE. (2) THE LD. AR OF THE ASSESSEE HAS SUBMITTED COMPLE TE DETAILS OF INCOMEWHICHWASBOOKEDDURINGTHISYEARAGAINSTWH ICHEXPENDITUREOF CARTINGHASBEENCLAIMED.THUSIFCORRESPONDINGINC OMEISTAXEDTHEN EXPENDITUREONEARNINGSUCHINCOMECANNOTBEDISALL OWED. (3) ITISNOTACASETHATOUTSTANDINGLIABILITIESA RESHOWNFORAGOOD NUMBEROFYEARS. 4. BEFOREUS,LD.DRSUBMITTEDTHATOPPORTUNITIESH AVENOTBEENGIVEN TOTHEAOTOEXAMINETHEDETAILSSUBMITTEDBYTHEA SSESSEEBEFORELD. CIT(A).SECONDLYCO-OPERATIONWASNOTEXTENDEDTOT HEAO. 5. NONEAPPEAREDONBEHALFOFTHEASSESSEE. 6. GROUNDNO.2RELATESTODELETIONOFADDITIONOFR S.1,95,672/-MADE ON ACCOUNT OF DISALLOWANCE UNDER SECTION 40A(2)(B) OUT OF CARTING CHARGESPAIDTOTHEWIFEOFASSESSEE.THEAOOBSERV EDTHATCERTAINCARTING CHARGESHAVEBEENPAIDTOSMT.TARABENPATEL,WIFE OFASSESSEEWHICHIS INEXCESSBY5.87%WHENCOMPAREDWITHPAYMENTSMADE TOOTHERPARTIES. ACCORDINGLYPAYMENTWASHELDTOBEEXCESSIVEANDWA SDISALLOWED.THE LD.CIT(A)DELETEDTHEADDITIONONTHEGROUNDTHAT INARUNNINGBUSINESS 4 CERTAINAMOUNTOFVARIATIONINEXPENDITUREISBOUND TOHAVEOCCURRED DEPENDING UPONVARIOUSFACTORS.SIMPLY BECAUSEPAYM ENTSHAVEBEEN MADETOTHEWIFEOFTHEASSESSEEINFOUROFTHETRI PS,ITDOESNOTPROVETHAT PAYMENTWASINANYWAYEXCESSIVE. 7. LD.DRSUPPORTEDTHEORDEROFAO.NONEWASPRESE NTONBEHALFOF THEASSESSEE. 8. WEHAVECONSIDEREDTHESUBMISSIONSOFLD.DRAND PERUSEDTHE MATERIALONRECORD.INOURCONSIDEREDVIEWTHEREIS NOCASEFORMAKING ANYINTERFERENCEINTHEORDEROFLD.CIT(A).THERE ASONSARETHATINRESPECT OFCARTINGEXPENDITUREAODIDNOTNOTICEANYIRREGU LARITIESANDBOOKS WERENOTREJECTEDBYHIM.ONTHEOTHERHANDSBOOKS AREAUDITEDUNDER SECTION44AB.THEREFORE,THEREISNOREASONTODISA LLOWANYEXPENDITURE WITHOUTREJECTINGTHEBOOKS.FURTHERITISNOTICED THATALLTHEPARTIESARE TRADECREDITORSANDBALANCEOUTSTANDINGHAVEBEENC ONFIRMEDBYTHOSE PARTIES.THEASSESSEEHADBOOKEDTHEINCOMEANDWAS DISCLOSEDINTHE PROFIT AND LOSS ACCOUNT. MERELY BECAUSE PAN IS NOT FURNISHED DISALLOWANCECANNOTBEMADEUNLESSPAYMENTISFOUND TOBEBOGUS.WE, THEREFORE,CONFIRMTHEORDEROFLD.CIT(A)ONTHIS GROUND. 9. SIMILARLYWECONFIRMTHEORDEROFLD.CIT(A)ON OTHERISSUEOF DISALLOWANCEUNDERSECTION40A(2)(B).THEREISONLY MARGINALVARIATION WHICHCANHAPPENINANYBUSINESS.ITISNOTPROVED THATPAYMENTSMADETO THE WIFE OF THE ASSESSEE WERE NOT GENUINE OR ARE NO T FOR BUSINESS CONSIDERATION.THEVARIATIONBEINGMARGINALNODISA LLOWANCEISCALLEDFOR. ASARESULTTHISGROUNDOFTHEREVENUEISALSODISM ISSED. 5 10. INTHERESULT,APPEALFILEDBYTHEREVENUEISD ISMISSED. SD/- SD/- (T.K.SHARMA) (D.C.AGRAWAL) JUDICIALMEMBER ACCOUNTANTMEMBER AHMEDABAD, DATED:31/05/2010 MAHATA/- COPYOFTHEORDERFORWARDEDTO :- 1.THEAPPELLANT. 2.THERESPONDENT. 3.THECIT(APPEALS)- 4.THECITCONCERNS. 5.THEDR,ITAT,AHMEDABAD 6.GUARDFILE. BYORDER, DEPUTY / ASSTT.REGISTRAR ITAT,AHMEDABAD ORDERPRONOUNCEDINOPENCOURTON31/05/2010