Nayak & Co, Burdwan V. I.T.O Wd - 2(2),Burdwan, Burdwan

ITA 1304/KOL/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 5025 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 10 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-04-2016
• Appeal Filed By: Assessee
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 16-05-2013
• Court: TRIBUNAL
• Assessee Lawyers: I BAN ERJEE
• Section: 143(3); 194C

Judgement Text

I.T.A. NO. 1304/KOL./2013 ASSESSMENT YEAR: 2007-2008 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA A BENCH, KOLKATA BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND SHRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER I.T.A. NO. 1304/KOL/ 2013 ASSESSMENT YEAR: 2007-2008 NAYEK & COMPANY,................................... ...........................APPELLANT P.O. MEMARI, DIST. BURDWAN-713 146, WEST BENGAL [PAN: AACFN 2058 F] -VS.- INCOME TAX OFFICER,................................ .............................RESPONDENT WARD-2(2), BURDWAN, AAYAKAR BHAWAN, BURDWAN COURT COMPOUND, BURDWAN-713 101 APPEARANCES BY: SHRI I. BANERJEE, FCA., FOR THE ASSESSEE SHRI RAJAT KUMAR KUREEL, JCIT, SR. D.R., FOR THE DEPARTMENT DATE OF CONCLUDING THE HEARING : MARCH 02, 2016 DATE OF PRONOUNCING THE ORDER : APRIL 06, 2016 O R D E R PER SHRI P.M. JAGTAP :- THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS), DURGAPUR 18.03.2013 AND THE SOLITARY ISSUE INVOLVED THEREIN RELATES TO THE DISA LLOWANCE OF RS.12,57,700/- MADE BY THE ASSESSING OFFICER AND CO NFIRMED BY THE LD. CIT(APPEALS) ON ACCOUNT OF TRANSPORT CHARGES BY INV OKING THE PROVISIONS OF SECTION 40(A)(IA) OF THE INCOME TAX ACT, 1961. 2. THE ASSESSEE IN THE PRESENT CASE IS A PARTNERSHI P FIRM, WHICH IS ENGAGED IN THE BUSINESS OF TRADING OF SEED AND TABL E POTATO AS WELL AS RUNNING AGENCY OF CONSUMER PRODUCTS. THE RETURN OF INCOME FOR THE YEAR I.T.A. NO. 1304/KOL./2013 ASSESSMENT YEAR: 2007-2008 PAGE 2 OF 4 UNDER CONSIDERATION WAS FILED BY IT DECLARING TOTAL INCOME OF RS.4,30,853/-. IN THE ASSESSMENT ORIGINALLY COMPLET ED UNDER SECTION 143(3), THE TOTAL INCOME OF THE ASSESSEE WAS DETERM INED BY THE ASSESSING OFFICER AT RS.38,98,520/- AFTER MAKING DISALLOWANCE , INTER ALIA, ON ACCOUNT OF TRANSPORT CHARGES UNDER SECTION 40(A)(IA) FOR TH E FAILURE OF THE ASSESSEE TO DEDUCT TAX AT SOURCE. ON APPEAL, THE LD . CIT(APPEALS) ALLOWED PART RELIEF TO THE ASSESSEE ON THIS ISSUE AND SUSTA INED THE DISALLOWANCE MADE BY THE ASSESSING OFFICER ON ACCOUNT OF TRANSPO RT CHARGES UNDER SECTION 40(A)(IA) TO THE EXTENT OF RS.10,57,700/-. ON FURTHER APPEAL, THE TRIBUNAL RESTORED THE MATTER BACK TO THE ASSESSING OFFICER VIDE ITS ORDER DATED 28.01.2011 PASSED IN ITA NO. 1146/KOL/2010 WI TH A DIRECTION TO THE ASSESSING OFFICER TO VERIFY THE CLAIM OF THE AS SESSEE THAT THE TRANSPORTERS HAVING BEEN ENGAGED BY THE SUPPLIERS, THERE WAS NO CONTRACT BETWEEN THE ASSESSEE AND THE SAID CONTRACTORS AND C ONSEQUENTLY THERE WAS NO QUESTION OF ANY REQUIREMENT FOR DEDUCTION OF TAX AT SOURCE UNDER SECTION 194C. AS PER THE DIRECTION OF THE TRIBUNAL, THE ASSESSING OFFICER VERIFIED THE CLAIM OF THE ASSESSEE AND FOUND THE SA ME TO BE NOT ACCEPTABLE ON THE GROUND THAT THERE WAS FAILURE ON THE PART OF THE ASSESSEE TO PRODUCE ANY DOCUMENTARY EVIDENCE TO SHOW THAT THE T RANSPORTERS WERE NOT ENGAGED BY IT BUT THEY WERE ENGAGED BY THE SUPP LIERS. ACCORDINGLY, IN THE FRESH ASSESSMENT COMPLETED UNDER SECTION 143(3) READ WITH SECTION 254 OF THE ACT VIDE ORDER DATED 17.11.2011, THE DIS ALLOWANCE ON ACCOUNT OF TRANSPORT CHARGES AMOUNTING TO RS.12,57,700/- UN DER SECTION 40(A)(IA) WAS REPEATED BY THE ASSESSING OFFICER. 3. AGAINST THE ORDER PASSED BY THE ASSESSING OFFICE R UNDER SECTION 143(3) READ WITH SECTION 254, THE ASSESSEE AGAIN WE NT IN APPEAL BEFORE THE LD. CIT(APPEALS) AND KEEPING IN VIEW THE CONFLI CTING STAND TAKEN BY THE ASSESSEE AT DIFFERENT STAGES, THE LD. CIT(APPEA LS) HELD THAT THERE WAS NO CASE OF GIVING ANY RELIEF TO THE ASSESSEE ON THI S ISSUE. ACCORDINGLY THE DISALLOWANCE MADE BY THE ASSESSING OFFICER ON ACCOU NT OF TRANSPORT CHARGES UNDER SECTION 40(A)(IA) WAS CONFIRMED BY TH E LD. CIT(APPEALS). I.T.A. NO. 1304/KOL./2013 ASSESSMENT YEAR: 2007-2008 PAGE 3 OF 4 AGGRIEVED BY THE ORDER OF THE LD. CIT(APPEALS), THE ASSESSEE HAS PREFERRED THIS APPEAL BEFORE THE TRIBUNAL. 4. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. AS POINTED O UT BY THE LD. COUNSEL FOR THE ASSESSEE, A SPECIFIC DIRECTION WAS GIVEN BY THE TRIBUNAL TO THE ASSESSING OFFICER TO VERIFY THE CLAIM OF THE ASSESS EE THAT THE CONCERNED TRANSPORTERS HAVING BEEN ENGAGED BY THE SUPPLIERS, THERE WERE NO CONTRACTS BETWEEN THE ASSESSEE AND THE SAID TRANSPO RTERS THEREBY MAKING IT OBLIGATORY ON THE PART OF THE ASSESSEE TO DEDUCT TAX AT SOURCE IN TERMS OF SECTION 194C. HE HAS SUBMITTED THAT ALL THE RELE VANT DETAILS IN THIS REGARD WERE DULY FILED BY THE ASSESSEE BEFORE THE A SSESSING OFFICER AND INVITED OUR ATTENTION TO THE SAID DETAILS PLACED AT PAGE NOS. 8 & 9 OF HIS PAPER BOOK. HE HAS ALSO INVITED OUR ATTENTION TO SO ME OF THE COPIES OF LORRY RECEIPTS AND CORRESPONDING BILLS RAISED BY TH E CONCERNED SUPPLIERS AS SAMPLES TO SHOW THAT THE TRANSPORTERS WERE NOT O NLY ENGAGED BY THE SUPPLIERS AT THEIR LEVEL BUT EVEN THE TRANSPORT CHA RGES PAID TO THEM WERE CHARGED BY THE SAID SUPPLIERS IN THE BILLS RAISED T O THE ASSESSEE. A PERUSAL OF THESE LORRY RECEIPTS AND SUPPLIERS BILLS FILED B Y THE ASSESSEE AS SAMPLES CLEARLY SHOWS THAT THE TRANSPORTERS WERE ENGAGED BY THE CONCERNED SUPPLIERS AND THE TRANSPORT CHARGES PAID TO THEM WE RE CHARGED BY THE SAID SUPPLIERS IN THE BILLS RAISED TO THE ASSESESE AND THIS POSITION IS NOT DISPUTED EVEN BY THE LD. D.R. IN OUR OPINION, THIS DOCUMENTARY EVIDENCE FILED BY THE ASSESSEE IS SUFFICIENT TO SUPPORT AND SUBSTANTIATE ITS CLAIM THAT THERE WAS NO CONTRACT ENTERED INTO BY IT WITH THE CONCERNED TRANSPORTERS AND IN THE ABSENCE OF SUCH CONTRACT, T HERE WAS NO REQUIREMENT OF DEDUCTION OF TAX AT SOURCE AS PER TH E PROVISIONS OF SECTION 194C. 5. IN THE CASE OF SHRI ANILKUMAR ARJUNDAS SHARDA - VS.- ITO (ITA NO. 2425/AHD/2013 DATED 06.02.2015) CITED BY THE LD. CO UNSEL FOR THE I.T.A. NO. 1304/KOL./2013 ASSESSMENT YEAR: 2007-2008 PAGE 4 OF 4 ASSESSEE, A SIMILAR ISSUE WAS INVOLVED IN IDENTICAL FACTS AND CIRCUMSTANCES AND THE COORDINATE BENCH OF THIS TRIB UNAL HAS HELD THAT THE SELLER HAVING ENGAGED THE TRANSPORTERS AND THE ASSE SSEE HAVING MERELY MADE PAYMENT TO SUCH TRANSPORTERS AS PER THE INSTRU CTION OF THE SELLER, THE ASSESSEE WAS NOT LIABLE TO DEDUCT TAX AT SOURCE UNDER SECTION 194C IN THE ABSENCE OF ANY CONTRACT WITH THE TRANSPORTERS A ND THE PROVISIONS OF SECTION 40(A)(IA) WERE NOT ATTRACTED. KEEPING IN VI EW THIS DECISION OF THE COORDINATE BENCH OF THIS TRIBUNAL IN THE CASE OF SH RI ANILKUMAR ARJUNDAS SHARDA (SUPRA) AND HAVING REGARD TO THE FACTS OF T HE CASE, WE ARE OF THE VIEW THAT THE DISALLOWANCE MADE BY THE ASSESSING OF FICER UNDER SECTION 40(A)(IA) ON ACCOUNT OF TRANSPORT CHARGES AND CONFI RMED BY THE LD. CIT(APPEALS) IS NOT SUSTAINABLE AND DELETING THE SA ME, WE ALLOW THIS APPEAL OF THE ASSESSEE. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON APRIL 06, 201 6. SD/- SD/- (S.S. VISWANETHRA RAVI) (P.M. JAGTAP) JUDICIAL MEMBER ACCOUNTANT MEMBER KOLKATA, THE 6 TH DAY OF APRIL, 2016 COPIES TO : (1) NAYEK & COMPANY, P.O. MEMARI, DIST. BURDWAN-713 146, WEST BENGAL (2) INCOME TAX OFFICER, WARD-2(2), BURDWAN, AAYAKAR BHAWAN, BURDWAN COURT COMPOUND, BURDWAN-713 101 (3) COMMISSIONER OF INCOME-TAX, KOLKATA; (4) CIT(APPEALS)- ,DURGAPUR (4) THE DEPARTMENTAL REPRESENTATIVE (5) GUARD FILE BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.