Income Tax Officer, Ward - 2, Karimnagar V. M/s Gayathri Cotton Pressing Industries, Karimnagar Dist.

ITA 1376/HYD/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 4831 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 2 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-11-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2004-2005
• Appeal Filed On: 07-09-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: MANIKYA PRASAD

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER ITA NO.1376/HYD/2012 (ASSESSMENT YEAR 2004 - 05) INCOME TAX OFFICER WARD 2, KARIMNAGAR, V/S M/S. GAYATHRI COTTON PRESSING INDUSTRIES, JAMMIKUNTA, KARIMNAGAR. ( PAN AABFO 6886 E ) (APPELLANT) (RESPONDENT) APPELLANT BY : SMT. K.HARITHA RESPONDENT BY : SHRI MANIKYA PRASAD DR DATE OF HEARING 26.11.2013 DATE OF PRONOUNCEMENT 26.11.2013 O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER: TH IS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE COMMIS SIONER OF INCOME - TAX(APPEALS) III, HYDERABAD DATED 29 TH JUNE, 2012 FOR THE ASSESSMENT YEAR 2004 - 05. 2. THE ONLY GRIEVANCE OF THE REVENUE IN THIS APPEAL IS WITH REGARD TO THE ACTION OF THE CIT(A) IN DELETING THE ADDITION OF R S . 1,84,071 MADE BY THE ASSES SING OFFICER TOWARDS DIFFERENCE IN GROSS RECEIPTS. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSING OFFICER OBSERVED THAT THERE W AS DIFFER E NCE OF RS .1,84,071 BETWEEN THE G R OSS RECEIPTS SHOWN IN TH E P ROFIT AND L OSS A CCOUNT AND THE RECEIPTS STATED IN TH E TDS CERTIFICATE ISSUED BY THE COTTON CORPORATION OF INDIA, WARANGAL. ON THIS COUNT, H E REOPENED THE ASSESSMENT AND ULTIMATELY COMPLETED THE RE - ASSESSMENT ON A TOTAL INCOME OF RS.2,56,799, AFTER MAKING TWO ADDITIONS - ONE OF R S .1,84,071 TOWARDS DIFFE RENCE IN GROSS RECEIPTS AND ITA NO. 708 /HYD/ 13 M/S. GAYATHRI COTTON PRESSING INDUSTRIES, JAMMIKUNTA, KARIMNAGAR. 2 ANOTHER OF RS .33,318 REPRESENTING ELECTRICITY CHARGES FOR THE REASON THAT THERE I S NO PROOF FOR THE PAYMENT. 4. ON APPEAL, THE CIT(A) DELETED BOTH THE ABOVE ADDITION S MADE BY THE ASSESSING OFFICER. HENCE REVENU E IS IN APPEAL BEFORE US WITH REGARD TO DELETION OF RS.1,84,071. 5. LEARNED DEPARTMENTAL REPRESENTATIVE SUB M I T T E D THAT THE CIT(A) DID NO T PROPERLY APPRECIATE THE FACTS THAT THERE W A S A DIFFERENCE BETWEEN THE INCOME OFFERED BY THE ASSESSEE TOWARDS PROCESSING CHAR G ES AND THE SAID INCOME AS PER THE TDS CERTIFICATE ISSUED BY THE COTTON CORPORATION OF INDIA. ACCOR D ING TO THE LEARNED DEPARTMENTAL REPRESENTATIVE THE CIT(A) ERRED IN CONSIDERIN G THE PAAL I CHAR G ES AS PRESSIN G AND PROCESSING CHARGES. 6. ON THE OTHER HAND, THE AUTHORISED REPRESENTATIVE SUBMI T TED THAT THE TOTAL RECEIPTS AS P E R THE PROFIT & LOSS ACCOUNT FILED BY THE ASSESSEE IS RS.14,16,205, WHICH INCLUDED RS.12,09,600 REPRESENTING PROCESSING C H ARGES AND R S .2,06,605 AS PER TDS CERTIFICATE, THE TOTAL AMOUNT WAS R S .13,93,671 WHICH INCLUDED PROCESSING CHARGES OF R S .12,06,049 AND PAAL I CHARGES OF R S .1,87,622. ACCOR D ING TO THE LEARNED COUNSEL FOR THE ASSESSEE , THE FIGURE IN THE PROFIT & LOSS ACCOUNT IS MORE THAN THE AMOUNT AS P E R TDS CERTIFIC A TE BY R S .2,02,534, AND AS SUCH THERE I S NO JUSTIFICATION FOR MAKING ANY FURTHER ADDITION TO WA RDS THE DIFFER E NCE BETWEEN THE FIGURES SHOWN IN PROFIT & LOSS ACCOUNT AND TH E TDS CERTIFICATE. FURTH E R , HE SUBMITTED THAT THE ASSESSEE IS SUBJECT TO TAX AUDIT UNDER S.44AB AND THE AUDITORS HAVE NOT POINTED OUT ANY DEFICIENCY IN TH E BOOKS OF ACCOUNT. I N THE CIRCUMSTANC E S, IT IS PL E ADED THAT THE ORDER O F THE CIT(A) BE CONFIRM E D. ITA NO. 708 /HYD/ 13 M/S. GAYATHRI COTTON PRESSING INDUSTRIES, JAMMIKUNTA, KARIMNAGAR. 3 7. W E HEARD BOTH THESES IDES AND PERU S ED THE M A TE R IAL ON RECORD. IN THIS CASE, THE TDS CERTIFICATE ISSU E D BY THE C OTTON CORPORATION OF INDIA SHOWS PROCESSING CHARGES AT AN AMOUNT OF R S .13,93,691. HOW E VER, THE ASSESSEE HAS SHOWN PROCESSING CHARGES IN ITS BOOKS OF ACCOUNT AT RS.12,09,600. THE PL E A OF THE ASSESSEE IS THAT TH E FIGURE IN THE TDS CERTIFICATE INCLU D ES TWO ELEMENTS AS FOLLOWS - AS PER TDS CERTIFICATE AS PER PROFIT & LOSS ACCOUNT PROCESSING CHARGES RS.12,06,049 RS.12,09,600 PA A L I CHARGES RS. 1,87,622 RS. 2,06,605 TOTAL RS.13,93,671 RS.14,16,205 AS SEEN FROM THE ABO V E DATA , THE AMOUNT OFFERED BY THE ASSESSEE TO WA RDS PROC E SSIN G CHARGES AND PAALI CHARGES IS MORE THAN THE ONE SHOWN IN THE TDS CERTIFICATE ISSUED BY COTTON CORPORATION OF I NDIA. BEING SO, THE CIT(A) OBSERVED THAT THERE IS NO SCOPE FOR ANY ADDITION TOWARDS DIFFERENCE IN THE AMOUNT REPRESENTED BY THT TDS CERTIFICATE AND THE AMOUNT STATE D IN THE PROFIT & LOSS ACCOUNT, AND ACTUALLY, THE AMOUNT OFFERED BY THE ASSESSEE IS MORE THAN THE ONE SHOWN IN THE TDS CERTIFIC A TES, WHEN HE CONSIDERED THE GROSS AMOUNT OF PROCESSING CHARGES AND PAALI CHARGES. IN OUR OPINION, TH E R E FORE, THE CIT(A) IS JUST IFIED IN DELETING THE ADDITION OF R S .1,84 ,071. WE ACCORDINGLY UPHOLD THE ORDER OF THE COMMISSIONER OF INCOME - TAX(APPEALS) AND REJECT THE GROUNDS OF THE REVENUE IN THIS APPEAL. 8. IN THE RESULT, REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE COURT AT THE CONCLUSION OF HEARING ON 26.11.2013 ( ASHA VIJAYARAGHAVAN ) ( CHANDRA POOJARI ) JUDICIAL MEMBER. ACCOUNTANT MEMBER. D T/ - 26 TH NOVEMBER, 2013 ITA NO. 708 /HYD/ 13 M/S. GAYATHRI COTTON PRESSING INDUSTRIES, JAMMIKUNTA, KARIMNAGAR. 4 COPY FORWARDED TO: 1. 2. M/S. GAYATHRI COTTON PRESSING INDUSTRIES, JAMMIKUNTA KARIMNAGAR. INCOME TAX OFFICER WARD 2, KARIMNAGAR, 3 . COMMISSIONER OF INCOME - TAX(APPEALS) III, HYDERABADD 4. COMMISSIONER OF INCOME - TAX II, HYDERABAD 5 DEPARTMENTAL REPRESENTATIVE ITAT HYDERABAD B.V.S. 1. DATE OF DICTATION 26.11.2013 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SENIOR P.S. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER AND OTHER MEMBER 26.11.2013 5. DATE ON WHICH THE FAIR ORDER GOES TO THE SR. P.S. 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK. 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 8. DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR 9. DATE OF THE DESPATCH OF THE TRIBUNAL ORDER