Sanghi Infrastructure Ltd., Ahmedabad V. The Dy. CIT, Circle-4(1) (1), , Ahmedabad

ITA 1285/AHD/2018

• Counselvise Citation: [2023] 101 COUNSELVISE.COM (IT) 9651 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 year(s) 6 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-12-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 25-09-2023
• Assessment Year: 2013-2014
• Appeal Filed On: 16-05-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SHRIASHOKKUMARSUTHAR; FORTHEASSESSEE.ASSUCH; ONAGGREGATIONOF
• Assessee Lawyers: SHRIBIRENSHAH
• Keywords: TDS

Judgement Text

आयकरअपीलीयअधिकरण , अहमदाबादनयायपीी INTHEINCOMETAXAPPELLATETRIBUNAL, ‘’C’’BENCH,AHMEDABAD BEFORESHRIWASEEMAHMED,ACCOUNTANTMEMBER And SHRISIDDHARTHANAUTIYAL,JUDICIALMEMBER आयकरअपीलसं./ITANo.1285/AHD/2018 धििाधरणवरध / Asstt.Year:2013-2014 SanghiInfrastructureLtd., 10 th Floor,KatariaArcade, Off.C.GRoad, PostMakarba, Ahmedabad. PAN:AALCS2163A Vs. D.C.I.T, Circle-4(1)(1), Ahmedabad. (Applicant)(Respondent) Assesseeby:ShriBirenShah,AR Revenueby:ShriAshokKumarSuthar,Sr.DR सुिवाईकीतारीख/DateofHearing:26/09/2023 घोरणाकीतारीख/DateofPronouncement:06/12/2023 आदेश/ORDER PERWASEEMAHMED,ACCOUNTANTMEMBER: ThecaptionedappealhasbeenfiledattheinstanceoftheAssesseeagainst theorderoftheLearnedPrincipalCommissionerofIncomeTax,Ahmedabad, arisinginthematterofassessmentorderpassedunders.263oftheIncomeTax Act,1961(here-in-afterreferredtoas"theAct")relevanttotheAssessmentYear 2013-2014. ITAno.1285/AHD/2018 A.Y.2013-14 2 2.TheonlyissuegrievanceoftheassesseeisthatLd.CIT(A)erredinholding assessmentframedu/s143(3)oftheActaserroneousinsofarprejudicialtothe interestoftherevenue. 3.Thefactsinbriefarethattheassesseeinthepresentcaseisalimited companyandengagedinthebusinessofprovidingDredgerandother Infrastructurefacilities.TheLd.PCITonexaminationofassessmentrecords observedthattheassesseeisfollowingmercantilesystemofaccounting.Asper theTDScertificate,theincomeofRs.3,95,72,000/-wasreflectingfromtheparty namelyM/sShivamconstructionagainstwhichtheamountofTDSofRs. 7,91,440/-wasdeducted.However,theassesseehasshownincomefromM/s ShivamConstructionintheprofitandlossaccountsforanamountofRs. 2,51,83,287/-leadingtoadifferenceofRs.1,43,88,713/-only.Accordingly,theLd. PCITwasoftheviewtheincomeoftheassesseehasbeenassessedonthelower amountwhichiserroneousandcausingprejudicetotheinterestoftherevenue. Thus,theld.PCITissuednoticeu/s263oftheAct.Theassesseeinresponseto suchnoticesubmittedthatit(theassessee)hasshownanincomeofRs. 2,76,53,061/-intheearlierAYfromShivamConstruction.Likewise,theincomefor theyearunderconstructionfromShivamConstructionwasshownofRs. 1,32,36,000/-aggregatingtoRs.4,08,89,061/-only.However,thepartynamely M/sShivamConstructionhasdeductedTDSontheamountofRs.3,95,72,000/-in theyearunderconsideration.Theassesseetothiseffecthasfiledthe reconciliationwhichisreproducedasunder: Fromtheaforesaidsubmissionandevidences,itissummarizedasfollows: CreditaccountedbyassesseeCompnayin FY2012-13 Rs.2,76,53,061/-Annexure-1 CreditaccountedbyassesseeCompanyin FY2012-13(AY2013-14) Rs.1,32,36,000/-Annexure-2 TotalCreditinthebooksoftheassessee Company Rs.4,08,89,061/- Creditin26ASfortheyearended 31.3.2013(AY2013-14)byShivam Construction Rs.3,95,72,000/- Excess(Short)creditinthebooksofthe assesseeCompany Rs.13,17,061/- ITAno.1285/AHD/2018 A.Y.2013-14 3 3.1Inviewoftheabove,itwascontendedbytheassesseethattheincome fromM/sShivamConstructionwasalreadysufferedtotaxintheearlierAYand thereforeitcannotbesaidthattheincomeoftheassesseehasbeenunder assessed. 4.However,theLd.PCITdisagreedwiththecontentionoftheassesseeby observingasunder: 6.1Initsreply,theassesseemainlycontendedthatthedifferenceisbecauseofthe reasonthatthereceiptsfromM/s.ShivamConstructionshasbeenshownintwoF.Yi.e 2011-12andF.Y2012-13.However,since,M/s.ShivamConstructionhaddepositedtotal TDSamountingtoRs7.91,440/.deductedonamountofRs.3,95,72,000/-duringtheA.Y 2013-14.thetotalcreditofRs.3,95,72,000/wasreflectedin26ASfortheyearunder consideration.AssesseehasalsotakenthecreditofthefullTDSclaimandtakenthe refundalso.Thus,itisautomaticthattheentirereceiptscorrespondingtoTDSis pertainingtotheyearunderconsideration.Thus,thecontentionraisedbytheassessee hasnotfoundacceptable,since,itisapparentfrom26ASdetailsthatM/sShivam ConstructionhaddeductedTDSonamountofRs.3.95,72,000/-fortheF.Y.2012-13and thesamewaspaidintotheGovt.AccountfortheF.Y2012-13aspertheTDSprovisions oftheAct.ThisfactsclearlyshowsthatM/sShivamConstructionhadreceivedthebills invoicesofRs3,95,72,000duringtheyearunderconsiderationandmusthadclaimedthe expenditureonaccountofthepaymentofRs.3,95,72,000/-toassesseecompanyinits booksduringtheyearunderconsiderationonlyi.e.fortheA.Y.2013-14.Theassesseehad notfurnishedanythingtosubstantiatethetimingdifferencebetweenincomeofthe assesseeandexpenditureofM/sShivamConstructionTheyearofreceiptsofpayeeand theyearofexpenseofpayercannotbedifferent.TheA.O.oughttohaveatleastverified thereconciliationofreceiptswithTDSclaimwhichhasnotevendone.TheA.O.hasnot evendiscussedthesameintheassessmentorder.Iftheassessee'scontentionthatthe receiptshavebeenofferedinA.Y.12-13,13-14theninthatcase,whythecreditofTDS hasnotbeenmadeintherespectiveyearsinproportiontothereceipts?Inthisregard,no explanationhasbeensubmitted.Eveninthesubmissiongiveninthepresentstillthe discrepancyofRs.13,71,061/-remainedtobeexplained. 6.2.Assesseealsofailedtosubmitanyspecificreplywhatsoeveronthepointsraisedin theabovereferrednoticeu/s263.Beingitacompletescrutiny.A.O.wasrequiredto examinetheveracityofTDScreditclaimedwithitsnexustotheincomeofferedinhis return,whichwasnotdonebytheAssessingOfficerThus,theA.O.hasfailedtocarryout inquiryorverificationinrespectofreceiptsnotshownasper26ASdetails,formakinga justandfairassessmentofincomeoftheassessee. 7TheAssessingOfficerhas,therefore,incorrectlyacceptedthefactssubmittedbythe assesseeandpassedtheorderu/s143(3)on23.02.2016.Theassessmentorderis erroneousinsofarasitis'prejudicialtotheinterestofRevenue". ITAno.1285/AHD/2018 A.Y.2013-14 4 5.InviewoftheabovetheLd.PCITafterreferringtoexplanation2ofsection 263oftheActheldthattheassessmentframedu/s143(3)oftheActiserroneous insofarprejudicialtotheinterestoftherevenueandaccordinglydirectedtothe AOtomakefreshassessmentaftermakingproperinquiryandverificationafter givingopportunitytotheassessee. 6.BeingaggrievedbytheorderoftheLd.PCIT,theassesseeisinappeal beforeus. 7.TheLd.ARbeforeusfiledapaperbookrunningfrompages1to51and reiteratedthesubmissionmadebeforetheLd.PCIT.TheLd.ARtobuttresshis argumenthasfiledtheFinancialStatementoftheimmediatelyprecedingA.Y whichareplacedonpages8to30and37to39ofthepaperbooks. 8.Ontheotherhand,theLd.DRcontendedthattherewasmismatch betweentheincomeoftheassesseeshowninform26ASandAuditedFinancial StatementandthisfacthasnowherebeeninquiredbytheAOduringthe assessmentproceedings.TheLd.DRvehementlysupportedtheorderoftheLd. PCIT. 9.Wehaveheardtherivalcontentionsofboththepartiesandperusedthe materialsavailableonrecord.Fromtheprecedingdiscussion,primarily,itappears thatthereisnolosstotherevenueasfarasincomeshownbytheassesseefrom M/sShivamConstructionprovidedthesamehasbeendeclaredintwodifferent AYsasdemonstratedbytheld.ARfortheassessee.Assuch,onaggregationof incomeoftheassesseefromM/sShivamConstructionin2differentAYsi.e.2012- 13and2013-14,itistranspiredthattheassesseehasshownexcessincomebyRs. 13,17,061/-asevidentfromthereconciliationstatementfiledbytheassessee beforetheLd.PCITwhichisreproducedsomewhereintheprecedingparagraph. ITAno.1285/AHD/2018 A.Y.2013-14 5 9.1Inthisregard,wealsonotethattheTribunalinthecaseofGujarat EngineeringCo.vsCITreportedin2017(3)TMI383hasdecidedtheissuein favouroftheassesseewhichisreproducedasunder: 2017(3)TMI383ITATAHMEDABADGujaratEngineeringCo.VersusCommissionerof Income-tax-I,VadodaraandGujaratEngineeringCo.VersusIncome-TaxOfficer,Ward-2 (2),VadodarawhereintheHon'bleITATheldasunder: Revisionu/s263claimofTDSHeldthat:Wenotethefactsmarshaledonbehalfofthe assesseethattheincometowardsdifferentialamountof16,03,521/-noticedbythe CommissionerhasbeenalreadyofferedfortaxationintheyearpriortotheimpugnedAY 2006-07.TheTDShasbeenclaimedinthecurrentassessmentyearaspercertificate issuedbythedeductorasperitsbooksofaccounts.Thishasgivenrisetothemismatchin thefiguresofjob-work.However,theimpugnedincomehasnotescapedassessmentatall. Onthecontrary,theincomehasbeenofferedpriortotheyearinwhichitissoughttobe taxedbytheCommissioner.Thesefactscouldnotberebuttedonbehalfoftherevenueat anystageoftheproceedingsbeforeus.Clearly,thereturnofincomefiledbytheassessee innotofferingthejobworkchargesintheassessmentyear2006-07whentheincomehas alreadybeenofferedintheearlierassessmentyearcannotbesaidtobeerroneousbyany stretchofimagination.Consequently,theassessmentorderpassedu/s143(3)oftheAct cannotbesaidtobesufferingfromany'error'onthisscore.Thus,oneofthetwo conditions,asnotedabove,isclearlynotsatisfied.Theorderu/s263is,therefore,liableto bestruckdownthisonscorealone. Intheabsenceofanydemonstrablelossofrevenue,interferenceinexerciseofpower underSection263cannotbejustified.Decidedinfavourofassessee. 9.2Bethatasitmaybe,whatwefindfromtheprecedingdiscussionisthis thattheveracityofthecontentionraisedbytheassesseebeforetheLd.PCIThas nowherebeenverifiedeitherbytheAOduringtheassessmentproceedingsorby theLd.PCITandaccordinglynofindingisthereonofsuchcontentionoftheld.AR. 9.3Furthermore,wehavealsoreferredtothereplymadebytheassesseein responsetothenoticeu/s142(1)oftheAct,placedonpages31to32ofthe paperbook,wefindthattheAOhasnotenquiredtheaspecthighlightedbytheLd. PCITinhisorderduringtheassessmentproceedings.Accordingly,itappearstous thattheAOinthegivencasehasnotconductedanyinquiryquatodifference betweenincomeshowninform26ASvis-a-visFinancialStatement.Inviewofthe above,thereremainnoambiguitythattheassessmentorderiserroneousinsofar prejudicialtotheinterestofrevenueifithasbeenpassedwithoutmaking ITAno.1285/AHD/2018 A.Y.2013-14 6 inquiriesduringtheassessmentproceedings.Accordingly,wedonotfindany reasontointerfereinthefindingoftheLd.PCIT.Accordingly,weupholdthesame. However,intheinterestofjustice,wedirecttheAOtoframetheassessment afreshinthelightoftheabovediscussionaspertheprovisionoflaw.Hence,the groundofappealoftheassesseeisherebydismissed. 10.Intheresult,theappealoftheassesseeisherebydismissed. OrderpronouncedintheCourton06/12/2023atAhmedabad. Sd/-Sd/- (SIDDHARTHANAUTIYAL)(WASEEMAHMED) JUDICIALMEMBERACCOUNTANTMEMBER (TrueCopy) Ahmedabad;Dated06/12/2023 Manish