Ramesh Kumar Singhania, Purulia V. JCIT, Range - 3, Asansol, Burdwan

ITA 1292/KOL/2011

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 3103 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-04-2013
• Appeal Filed By: Assessee
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 03-10-2011
• Court: TRIBUNAL
• Department Lawyers: K N JANA
• Assessee Lawyers: ARVIND AGARWAL
• Keywords: Cost of acquisition
• Section: 40A(3); 143(3); 194C

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH A , KOLKATA [ () . .. . . .. . , ,, , , !' #! $'# #! $'# #! $'# #! $'#, ,, , ] ]] ] [BEFORE HONBLE SRI K.K.GUPTA, AM & HONBLE SRI MAHAVIR SINGH, JM] '& '& '& '& /ITA NO.1292/KOL/2011 $'( !)*/ ASSESSMENT YEAR : 2008-09 (,- / APPELLANT ) - !' - ( /0,- /RESPONDENT) RAMESH KUMAR SINGHANIA . J.C.I.T., RANGE-3, PURULIA -VERSUS- ASANSOL (PAN:AMQPS 8232 G) '& '& '& '& /ITA NO.1447/KOL/2011 $'( !)*/ ASSESSMENT YEAR : 2008-09 (,- / APPELLANT ) - !' - ( /0,- /RESPONDENT) J.C.I.T., RANGE-3, RAMESH KUMAR SINGHANIA ASANSOL . PURULIA -VERSUS- (PAN:AMQPS 8232 G) ,- 1 2 / FOR THE ASSESSEE SHRI ARVIND AGARWAL /0,- 1 2 / FOR THE DEPARTMENT SHRI K.N.JANA, SR.DR '!3 1 4 /DATE OF HEARING : 03.04.2013 5) 1 4 /DATE OF PRONOUNCEMENT : 05.04.2013. 6 / ORDER PER SHRI K.K.GUPTA, AM THESE APPEALS BY THE ASSESSEE AS WELL AS THE REVENU E ARISE FROM THE ORDER OF THE LD. CIT(A)-ASANSOL DATED 26.07.2011 FOR ASSESSM ENT YEAR 2008-09 WHERE THE ISSUES RAISED BY THE PARTIES WERE HEARD AND RELATE TO PART DELETIONS AND PART ADDITIONS SUSTAINED BY THE LD. CIT(A). WE PROPOSE TO TAKE UP BOTH THE APPEALS TOGETHER FOR THE SAKE OF CONVENIENCE AND BREVITY AS THE ISSUES RAISE D WERE PUT FORTH AT THE TIME OF HEARING. ITA NOS.129 2 &1447/KOL/2011 2 2. WE HAVE CONSIDERED THE ISSUES ON THE BASIS OF TH E FACTS BROUGHT ON RECORD BY THE AO AND THE CIT(A) WHICH ARE IN DISPUTE. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E BEING A SOLE PROPRIETOR OF M/S.R.K.SINGHANIA, IS A WHOLESALE TRADER OF VARIOUS OILS AND VANASPATI WAS SUBJECTED TO SCRUTINY ASSESSMENT U/S 143(3) HAVING FILED THE RETURN OF INCOME ALONG WITH FINANCIAL STATEMENTS DULY AUDITED WHEN THE AO IN HI S DETAILED ORDER ASSESSED THE INCOME OF ASSESSEE AT RS.41,77,559/-. THE AO FOUND FALL IN THE GROSS PROFIT RATE ASSUMED TO HOLD THAT THE BOOKS OF ACCOUNTS NOT PROP ERLY MAINTAINED. IN ORDER TO COMPUTE THE CORRECT INCOME BY INVOKING THE PROVISIO N OF SECTION 145(3) OF THE ACT, AFTER VARIOUS DISCUSSIONS REGARDING THE PURCHASE, S ALES AND THE QUANTITY OF EMPTY TINS ETC. PROPOSED TO ADMIT THE GP RATE AS WAS DECLARED IN THE IMMEDIATELY PRECEDING ASSESSMENT YEAR WHICH ASSESSMENT ORDER HAS BEEN PLA CED ON RECORD BY THE LD. COUNSEL FOR THE ASSESSEE. THE AO BY APPLYING THE SAME RATE AND HOLDING THE ASSESSEE NOT ABLE TO EXPLAIN THE FALL IN GROSS PROFIT RATE BROUGHT TO TAX A SUM OF RS.23,13,794/- IN THE IMPUGNED ASSESSMENT ORDER. THE LD AO FURTHER CONSID ERED THE EXPLANATION ON ACCOUNT OF FREIGHT PAID TO THE TRUCK OWNERS ON THE BASIS OF SALES AS WELL AS PURCHASES WHEN HE PROPOSED TO DISALLOW A SUM OF RS.4,57,970/- U/S 40( A)(IA) OF THE ACT HOLDING THAT THE TAX DEDUCTION AT SOURCE WAS NOT DEPOSITED ON TIME A S CLAIMED BY THE ASSESSEE, WHEN HE PARTLY CONSIDERED THAT THE ASSESSEE HAD ALSO VIOLAT ED THE PROVISION OF SECTION 40A(3) OF THE ACT. CONTINUING HIS FINDING HE FURTHER MADE ADD ITION OF RS.91,202/- IN RESPECT OF FREIGHT CHARGES BY INVOKING THE PROVISION OF SECTIO N 40A(3) OF THE ACT. FURTHER THE AO MADE ADDITION BY DISALLOWING A SUM OF RS. 9,71,064/ - BY COMBINING THE PROVISION OF SECTION 40(A)(IA) AND 40A(3) OF THE IT ACT BY HOLDI NG A VIEW THAT THE ASSESSEE WAS NOT ABLE TO FURNISH THE REQUISITE INFORMATION REGARDING THE INDIVIDUAL TRUCKS WHETHER WERE SUBJECTED TO CLAIM ITS INCOME EXCEEDING RS.20,000/ - EACH, IN SO FAR AS PAYMENTS EXCEEDED RS.20,000/- EACH WHEN THE CLAIM OF THE ASS ESSEE WAS THAT THE DISALLOWANCE CANNOT BE MADE U/S 40(A)(IA) OF THE IT ACT. THE AO MADE OTHER ADDITIONS AND DELETIONS INCLUDING ADDITION ON ACCOUNT OF LOW DRAW INGS IN THE HANDS OF ASSESSEE BY BRINGING TO TAX RS.36,000/- TO JUSTIFY BALANCING LO W DRAWINGS OF THE ASSESSEE. ITA NOS.129 2 &1447/KOL/2011 3 4. AGGRIEVED THE ASSESSEE WENT IN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY TO CONSIDER THESE ISSUES RENDERING PART SUSTENANCE AND PART DELETIONS AND RAISING THE RESPECTIVE GROUNDS AS FOLLOWS :- ITA NO.1292/KOL/2011 (BY THE ASSESSEE) 1.(A) FOR THAT, IN VIEW OF FACTS & CIRCUMSTANCES O F THE CASE LD.CIT(A) WAS NOT JUSTIFIED IN NOT DELETING DISALLOWANCE OF RS.457970 /- MADE BY LD.A.O. OUT OF CLAIM OF FREIGHT CHARGES ON ALLEGED GROUND THAT TDS WAS NOT DEPOSITED IN TIME. 1.(B) FOR THAT, WITHOUT PREJUDICE TO THE ABOVE LD.C IT(A)WAS NOT JUSTIFIED IN NOT APPRECIATING THE MATERIAL ON RECORD REGARDING DATE OF DEDUCTION OF TAX AT SOURCE IN MARCH, 2008 AND SUBSEQUENT DEPOSIT OF SUCH T.D.S . ON 26.09.2008 E.G. BEFORE DUE DATE OF FILING OF RETURN OF INCOME, AND IN DIRE CTING LD.A.O. TO VERIFY FURTHER THE FACTUAL POSITION AND ALLOW RELIEF AS PER LAW. 2.(A) FOR THAT, IN VIE OF FACTS AND CIRCUMSTANCES OF THE CASE, LD.AO ERRED ON FACTS AS WELL AS IN LAW IN SUSTAINING DISALLOWANCE OF RS.388426/- BEING 40% OF RS.971064/- CLAIMED UNDER FREIGHT CHARGES PAID TO L OCAL TRUCKS. 2.(B) FOR THAT, WITHOUT PREJUDICE TO THE ABOVE LD.C IT(A) ERRED IN SUSTAINING DISALLOWANCE OF 40% MERELY ON PRESUMPTION, IGNORING THE FACT THAT ALL PAYMENTS WERE SUPPORTED BY VOUCHERS AND PAYMENTS WERE MADE W ITHIN THE PRESCRIBED LIMIT OF RS.20000/- ON A SINGLE OCCASION. 2.(C) FOR THAT LD. CIT(A) FAILED TO APPRECIATE THAT THERE WAS NO LIABILITY TO DEDUCT TAX AT SOURCE AS PAYMENTS MADE TO SINGLE PERSON DOE S NOT EXCEED RS.50000/-. 3. FOR THAT, CIT(A) ERRED IN MAKING DISALLOWANCE OF RS.91202/- U/S 40A(3) OF INCOME TAX ACT, 1961 WITHOUT APPRECIATING THE FACT THE PAYMENT ON SINGLE OCCASION DID NOT EXCEED RS.20000/-. 4. FOR THAT, APPELLANT CRAVES LEAVE TO AMEND, ALTER MODIFY ADD TO ABRIDGE AND/OR RESCIND ANY OR ALL OF THE ABOVE GROUNDS. ITA NO.1447/KOL/2011 (BY THE REVENUE): I) THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LD. CIT(A) ERRED IN LAW BY DELETING THE ADDITION AMOUNT OF RS.23,13,067/- WHIC H WAS MADE BY INVOKING PROVISION OF SECTION 145(3) OF THE IT ACT 1961. II) THAT THE LD. CIT(A) WHILE DECIDING THE ISSUE I N FAVOUR OF THE ASSESSEE, IGNORED THE FACT THAT NO CORROBORATING EVIDENCE IN RESPECT OF THE DEDUCTION OF TDS U/S 194C WAS FURNISHED BY THE ASSESSEE. III) THAT THE LD. CIT(A) FAILED TO APPRECIATE, WHIL E DECIDING THE ISSUE IN FAVOUR OF THE ASSESSEE, IN RESPECT OF FREIGHT CHARGES CLAIMED BY THE ASSESSEE WITHOUT ANY COGNIZABLE DOCUMENTS IN FAVOUR OF HIS CLAIM. IV) THAT THE LD. CIT(A) HAS ERRED IN DELETION OF TH E ADDITION MADE BY THE AO IN RESPECT OF DRAWINGS AFTER COMPLETION OF ASSESSMENT OF THE INSTANT CASE U/S 143(3) OF THE ACT, BECAUSE THE ASSESSEE HAS SHOWN A VERY L OW DRAWINGS OF ONLY RS.85,000/-. ITA NOS.129 2 &1447/KOL/2011 4 V) THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR ABRO GATE ANY GROUND OF APPEAL AT THE TIME OF HEARING. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULL Y PERUSED THE MATERIALS AVAILABLE ON RECORD. IN RESPECT OF THE FIRST ISSUE RAISED BY THE REVENUE WITH RESPECT TO DELETION OF ADDITION OF RS.23,13,067/- WE ARE OF TH E CONSIDERED VIEW THAT THE LD. AO REJECTED THE BOOK RESULTS INVOKING THE PROVISIONS O F SECTION 145(3) OF THE IT ACT WHO ENHANCED THE GROSS MARGIN ON THE GOODS TRADED IN BY THE ASSESSEE BY COMPARING IT WITH THE GROSS MARGIN ACCEPTABLE TO IT IN THE IMMED IATELY PRECEDING ASSESSMENT YEAR WHICH ASSESSMENT ORDER ACCEPTED THE BOOK RESULTS AS PER THE RETURN FILED ALONG WITH AUDITED FINANCIAL STATEMENTS. IN OTHER WORDS THE LD . CIT(A) CONSIDERED THE CASE OF THE ASSESSEE APPELLANT ON THE BASIS OF THE AO JUSTIFYIN G ITS INVOKING THE PROVISION OF SECTION 143(5) OF THE ACT FUTILE WHO PLACED RELIANC E ON JUDICIAL PRONOUNCEMENTS WHICH THE LD. CIT(A) TOOK UPON HIMSELF TO DISTINGUISH IN SO FAR AS IT WAS NOT THE CASE OF THE AO TO COMPUTE CORRECT INCOME AFTER INVOKING THE PRO VISION OF SECTION 145(3) OF THE ACT WHEN THE CORRECT INCOME WAS COMPUTED BY THE AO WAS FAULTY AS PER HIS OWN FINDINGS TO RENDER ENHANCEMENT IN GROSS MARGIN ONLY . THE ASSESSEE HAD MAINTAINED PROPER BOOKS OF ACCOUNTS AND FAILURE OF THE ASSESSE E FOR NOT DISCLOSING THE PERMANENT ACCOUNT NUMBER AND THE ADDRESS OF THE TIN MANUFACTU RERS TO BE PAID AND SUPPLY THE TINS REMAINED UNUTILIZED IN CONSEQUENCE TO WHICH TH E AO THOUGHT IT FIT TO ENHANCE THE GROSS MARGIN WHICH WAS NOT THE CASE FOR INVOKING TH E PROVISION OF SECTION 145(3) OF THE IT ACT WAS CONSIDERED BY THE LD. CIT(A). IN FAC T THE LD.CIT(A) OBSERVED THAT THE BASIS ADOPTED BY THE AO FOR CONSEQUENT ENHANCEMENT OF THE GROSS PROFIT RATE WAS ITSELF FAULTY AND CAN NOT BE CONSIDERED FOR ASSUMPT ION OF COMPUTING CORRECT INCOME IN ACCORDANCE WITH THE PROVISION OF INCOME TAX ACT. HE THEREFORE DEEMED IT FIT TO DISTINGUISH THE CASE LAWS RELIED UPON BY THE AO, IN SO FAR AS, HE CONCLUDED THAT THERE WAS NO BASIS FOR THE AO TO REJECT THE BOOK RESULT BY INVOKING THE PROVISION OF SECTION 145(3) OF THE ACT. THE LD. DR HAS NOT BEEN ABLE TO FURNISH ANY CONTRARY MATERIAL TO THAT EFFECT, IN SO FAR AS, ON PERUSAL OF THE STATEM ENTS AND THE METHOD OF ACCOUNTING ADOPTED WE ARE OF THE CONSIDERED VIEW THAT THE BOOK S OF ACCOUNT REFLECTING THE TRUE AND CORRECT INCOME IS DERIVED ON THE BASIS OF PURCH ASES, SALES AND THE VALUATION OF ITA NOS.129 2 &1447/KOL/2011 5 CLOSING STOCK DO NOT REQUIRE ANY FURTHER DELIBERATI ON. THE GROUND RAISED BY THE REVENUE STANDS DISMISSED. 6. THE NEXT GROUND RAISED BY THE REVENUE AS WELL AS THE ASSESSEE RELATES TO THE DISALLOWANCE OF RS.4,57,970/- U/S 40(A)(IA) OF THE ACT WHICH HAS BEEN CONSIDERED BY THE LD. CIT(A) BY DIRECTING THE AO TO VERIFY THAT T HE SAID SUM HAVING BEEN SUBJECTED TO DEDUCTION OF TAX AT SOURCE WAS MADE KNOWN TO THE AO BUT WHETHER VERIFIED BY HIM IN SO FAR AS THE LD. COUNSEL FOR THE ASSESSEE HAS S UBMITTED THAT THE AO IN HIS ORDER AS MAY BE PERUSED HAS CATEGORICALLY MENTIONED THAT THE TAX DEDUCTED AT SOURCE WAS DEPOSITED ON 26.09.2008. IN VIEW OF THE PROVISION O F THE SAID SECTION WHEN THE TAX DEDUCTED AT SOURCE IS ALLOWED TO BE DEPOSITED BEFOR E FILING OF THE RETURN WE ARE OF THE CONSIDERED VIEW THAT THE LD. CIT(A) OUGHT NOT TO HA VE DIRECTED THE AO TO VERIFY THE DEPOSITION OF THE TAX ON 26.09.2008 ALREADY WHICH W AS NOT DISPUTED BY THE AO. THE REVENUE HAS NOT BEEN ABLE TO CONTROVERT THIS AS OF NOW THEREFORE DOES NOT REQUIRE ANY FURTHER DIRECTION BY US. THE DIRECTION OF THE LD. C IT(A), THEREFORE, APPEARS TO BE MISPLACED AND THE GROUND RAISED BY THE REVENUE IN S O FAR AS THE EVIDENCE IN RESPECT OF THE DEDUCTION OF TDS WAS MADE KNOWN TO THE AO WHO O BSERVED THAT THE TDS HAS BEEN DEPOSITED NOW DOES NOT REQUIRE DISALLOWANCE U/ S 40(A)(IA) OF THE ACT, IN SO FAR AS 40(A)(IA) ALLOWS DEPOSITION OF SUCH TAX BEFORE THE DUE DATE OF FILING OF THE RETURN WHEN THE ASSESSEE CLAIMED THAT IT HAD FILED THE RETURN O F INCOME ON TIME IN ACCORDANCE WITH THE PROVISION OF SECTION 139(1) OF THE ACT. THE GRO UND RAISED BY THE REVENUE IS DISMISSED AND THE GROUND RAISED BY THE ASSESSEE IS ALLOWED. 7. IN RESPECT TO THE NEXT GROUND RAISED BY THE ASSE SSEE IT HAS BEEN SUBMITTED THAT THE DISALLOWANCE OF RS.9,71,064/- WAS ON ACCOUNT OF FREIGHT CHARGES ON THE GROUND OF IDENTITY NOT PROVED AND VERIFICATION FROM ANGLE OF VIOLATION OF NON DEDUCTION OF TAX AT SOURCE WAS TO BE CONSIDERED U/S 40(A)(IA) AND NOT T O BE CONFUSED IN VIOLATION TO SECTION 40A(3) OF THE ACT WAS DEALT WITH BY THE LD. CIT(A) BUT TO THE EXTENT THAT THE CIT(A) HAS ALLOWED PART RELIEF BY RESTRICTING THE DISALLOW ANCE TO 40% THEREOF WHICH UNDER NO PROVISION OF LAW CAN BE CONSIDERED AS PART RELIEF T O THE ASSESSEE OR PART SUSTENANCE BY THE REVENUE UNDER THE PROVISION OF SECTION 40(A)(IA ) OR 40A(3) OF THE ACT. THE LD. ITA NOS.129 2 &1447/KOL/2011 6 COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT VARIOUS DETAILS AS REQUIRED BY THE AO WERE FURNISHED AND IT WAS THE AOS NON APPLICATION OF MI ND TO THE FACT, IN SO FAR AS, REJECTION OF THE BOOK RESULTS CANNOT FURTHER BE GRO UND FOR DISALLOWANCE. THE AO TOOK UPON HIMSELF TO FIND THAT WHENEVER THE TRUCK OWNERS WERE PAID MORE THAN RS.20,000/- WHEN THE AO SOUGHT TO DISALLOW PART OF THE FREIGHT CHARGES IN SO FAR AS HE REMAINED CONFUSED BETWEEN THE FREIGHT INWARD AND OUTWARD WHE N THE FREIGHT IS PART OF THE PURCHASE COST TO THE ASSESSEE. THE LD. COUNSEL FOR THE ASSESSEE EXPLAINED THAT THE FREIGHT IS ACCOUNTED SEPARATELY. THE ASSESSEE BEING A TRADER NOT A MANUFACTURER OF OIL OR VANASPATI THE ASSESSEE THEREFORE HAD TO PAY IN C ASH WHEN THE REGULAR TRUCKS WHICH WERE BRINGING IN THE GOODS WERE NEVER ACCOUNTED FOR PAYMENT, BUT BY WAY OF JOURNAL ENTRY THE AMOUNTS WERE PAID AFTER THE PURCHASES CRY STALLIZED. THE LD. COUNSEL ALSO SUBMITTED THAT THE LD. CIT(A) OBSERVED THEREAFTER T HAT THE TOTAL CLAIM OF CARRIAGE INWARD AND OUT WARD BY IDENTIFYING THE TRUCK OWNERS WHICH WAS NOT THE CASE OF THE ASSESSEE TO INVOKE THE PROVISION OF SECTION 194C OF THE ACT. THEN THE AO HELD THAT THE AMOUNT CAN BE DISALLOWED U/S 40A(3) OF THE ACT IN S O FAR AS HAVING CONSIDERED THE DISALLOWANCE EARLIER, AS MENTIONED ABOVE, IT WAS TH E CASE TO BE CONSIDERED U/S 40A(3). WE HAVE PERUSED THE ORDERS OF THE AUTHORITIES BELOW AND WE FIND THE CONTENTION OF THE LD. COUNSEL FOR THE ASSESSEE JUSTIFIED TO THE EXTEN T THAT THERE CANNOT BE A PROVISION FOR DISALLOWANCE EITHER U/S 40(A)(IA) OR 40A(3) OF THE ACT SIMULTANEOUSLY. THE LD. DR AS OF NOW HAS NOT BEEN ABLE TO IDENTIFY THE PORTION OF THE DISALLOWANCE U/S 40A(3) OF THE ACT BEING 40% AGAINST WHICH THEY ARE IN APPEAL IN S O FAR AS 60% HAS BEEN DELETED BY THE LD. CIT(A) AS HAS BEEN RAISED BY WAY OF A GROUN D BY THE ASSESSEE BEFORE US. WE DO FIND THAT THE AUTHORITIES BELOW HAVE MADE CONTRARY FINDINGS IN SO FAR AS ON ONE HAND THEY HELD THAT THE IDENTITY OF THE VEHICLE WAS NOT PROVIDED TO INVOKE THE PROVISION OF SECTION 40(A)(IA) IN SO FAR AS AFTER HAVING FURNISH ED THE DETAILS BEFORE THE AO WHO DISALLOWED THE SAME U/S 40A(3) OF THE ACT. THE LD. COUNSEL HAS POINTED OUT THAT THE AO HIMSELF HAS AGREED TO THE PROPOSITION THAT THE S AID ASSUMPTION OF FREIGHT CHARGES TO TRUCKS OF MORE THAN RS.20,000/- DOES NOT APPLY TO T HE ASSESSEES FACTS AND IN SO FAR AS THE SAME HAS COME INTO EFFECT FROM 1 ST JULY, 2007 WHICH THE LD. CIT(A) HAD ALSO ACKNOWLEDGED BUT AS A LIBERTY THAT THE ASSESSEE HAD ADMITTED THAT THERE WERE ERRORS IN DEDUCTION OF TAX AT SOURCE TO PROTECT THE INTEREST OF THE REVENUE CONFIRMED 40% THEREOF ITA NOS.129 2 &1447/KOL/2011 7 WHICH WE ARE UNABLE TO SATISFY OURSELVES EITHER WAY AS MENTIONED ABOVE. THERE CANNOT BE PROPORTIONATE DISALLOWANCE EITHER U/S 40(A)(IA) OR 40A(3) OF THE ACT WHICH EXPENSES DISALLOWANCES HAVE TO BE MADE ON SPECIFIC ITEMS OF EXPENDITURE CANNOT BE RULED OUT AND THE CONFUSION IN THE MINDS OF THE AUT HORITIES BELOW THEREFORE REQUIRES NO FURTHER DELIBERATION. THE GROUND RAISED BY THE ASSE SSEE IS ALLOWED AND THE GROUND RAISED BY THE REVENUE IS DISMISSED. 8. THE NEXT GROUND RELATES TO THE DELETION OF THE C ONFIRMATION OF RS.91,292/- U/S 40A(3) OF THE ACT ON PAYMENTS MADE TO M/S. BHARAT G OODS TRANSPORT AND JOY JHARKHAND ROAD LINES. IT WAS SUBMITTED THAT THE LD. CIT(A) ALTHOUGH HELD THAT THE AOS RELIANCE ON SECTION 40A(3) WAS MIS PLACED IN S O FAR AS THE PROVISIONS OF THE SECTION QUOTED BY THE AO CAME INTO EFFECT FROM 1 ST APRIL, 2009 THOUGH HE CONFIRMED THE ACTION ON THE GROUND THAT THE FIGURES MENTIONED BY THE AO APPEAR TO EXCEED RS.20,000/- EACH WAS CONFIRMED BY THE LD. CIT(A). I T WAS SUBMITTED BY THE LD. COUNSEL, AS PLACED IN THE PAPER BOOK, THAT THE RUNN ING ACCOUNTS OF BHARAT GOOD TRANSPORT AND JOY JHARKHAND ROAD LINES ARE NOT MADE AS CASH PAYMENTS EXCEEDING RS.20,000/- BUT ARE ACTUALLY JOURNAL ENTRIES CREATI NG IDENTIFICATION OF THE FREIGHT CHARGES CARRIED BY THEM IN SO FAR AS CASH RECEIPT, NOTINGS OR INVOICES DRAWN ON VARIOUS PARTIES INDICATE THE BONA FIDE OF THE FREIGHT BEING CHARGED FOR THE MOVEMENT OF THE GOODS AS MANDATORY FOR OTHER GOVERNMENT AGENCIES. T HEREFORE AT NO POINT OF TIME THE FREIGHT EXCEEDED RS.20,000/- WAS THE BASIS WHICH WA S MISCONSTRUED BY BOTH THE AUTHORITIES BELOW. THE LD. COUNSEL FOR THE ASSESSE HAS FILED THE DETAILS OF ALL THE FREIGHT PAID IN THE PAPER BOOK WHICH HAD ALREADY BEEN CONSI DERED AND PERUSED BY THEM ON THE ISSUES RAISED BY THE AUTHORITIES MENTIONED ABOVE. T HEREFORE WE ARE OF THE CONSIDERED VIEW THAT THE AO HAVING CATEGORICALLY GIVEN A FINDI NG THAT THE NUMBER OF TRUCKS WITH THEIR REGISTRATION NUMBER AND THE INDIVIDUAL FREIGH T PAID TO THEM UNDER NO CIRCUMSTANCES WERE PAID EXCEEDING RS.20,000/-, WE A RE OF THE VIEW THAT THE PROVISION OF SECTION 40A(3) OF THE ACT HAS BEEN CONSIDERED BY THE LD. CIT(A) HOLDING A VIEW THAT SUCH PAYMENTS IN A SINGLE DAY WAS NOT TO BE AP PLIED AS PER THE PROVISION OF THE INCOME TAX ACT ITSELF RENDERS THIS ADDITION WORTHY FOR DELETION. THE GROUND RAISED BY THE ASSESSEE STANDS ALLOWED,. ITA NOS.129 2 &1447/KOL/2011 8 9. THE LAST ISSUE RELATES TO THE ADDITION OF A SUM OF RS.36,000/- IN THE HANDS OF THE ASSESSEE ON A FINDING BY THE AO IN RESPECT OF LOW DRAWINGS. WE HAVE PERUSED THE ORDERS OF THE AUTHORITIES BELOW WHEN THE LD. CIT(A) HAS DELETED THE SAME BY HOLDING A VIEW THAT THE LUMPSUM ADDITION OF RS.36,000/- AGAIN ST DRAWINGS ALREADY CLAIMED AT RS.85,000/- DOES NOT JUSTIFY THE ADDITION IN SO FAR AS THE AO HAS ALSO NOT POINTED OUT WHETHER THE ADDITION OF RS.36,000/- WOULD JUSTIFY T HE INCOME RETURNED BY THE ASSESSEE TO ACCLAIM A STATUS FOR LOW DRAWINGS. THE CIT(A) HA S DELETED THE SAME AS NO MATERIAL HAS BEEN BROUGHT ON RECORD BY THE AO. WE DO NOT FIN D ANY INFIRMITY THEREIN. THE GROUND RAISED BY THE REVENUE IS DISMISSED. 10. IN THE RESULT THE APPEAL OF THE REVENUE IS DISM ISSED AND THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE COURT ON 05.04.2013. SD/- SD/- [ .#! $'# , ] [ .., ,, , ] [MAHAVIR SINGH ] [K.K.GUPTA] JUDICIAL MEMBER ACCOUNTANT MEMBER ( (( ( 4 44 4) )) ) DATE: 05.04.2013. R.G.(.P.S.) 6 1 /$$7 87)9- COPY OF THE ORDER FORWARDED TO: 1. RAMESH KUMAR SINGHANIA, R.B.S.C. SINHA ROAD, KANDAM KULI, PURULIA. 2 J.C.I.T., RANGE-3, ASANSOL. 3 . CIT KOLKATA 4 . CIT(A)-ASANSOL. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. 07 /$/ TRUE COPY, 6'/ BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES ITA NOS.129 2 &1447/KOL/2011 9