ITO, Chandigarh V. M/s Universe Construction Company, Chandigarh

ITA 1384/CHANDI/2010

• Counselvise Citation: 138421514 RSA 2010
• Duration Of Justice: 1 year(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-12-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 12-12-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 07-12-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JAI SHREE SHARMA
• Assessee Lawyers: ANIL KUMAR BATRA
• Keywords: Assessment record
• Section: 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH A CHANDIGARH BEFORE MS.SUSHMA CHOWLA, JUDICIAL MEMBER AND SHRI MEHAR SINGH, ACCOUNTANT MEMBER ITA NO. 1384/CHD/2010 ASSESSMENT YEAR: 2007-08 ITO, WARD 4(1), V M/S UNIVERSE CONSTRUCTION CO., CHANDIGARH. H.NO. 1168, SECTOR 37B, CHANDIGARH. PAN: AAAFU-2206Q (APPELLANT) (RESPONDENT) DEPARTMENT BY: SMT.JAISHREE SHARMA ASSESSEE BY : SHRI ANIL KUMAR BATRA DATE OF HEARING : 12.12.2011 DATE OF PRONOUNCEMENT : 14.12.2011 ORDER PER MEHAR SINGH, AM THE PRESENT APPEAL FILED BY THE REVENUE IS AGAINST THE ORDER DATED 12.08.2010 PASSED BY THE LD. CIT(A) U/S 250 OF THE INCOME-TAX ACT,1961 (IN SHORT 'THE ACT'). 2. IN THIS APPEAL, THE REVENUE HAS RAISED THE FOLLO WING GROUNDS OF APPEAL: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) HAS ERRED IN ALLOWING AP PEAL OF THE ASSESSEE WITHOUT APPRECIATING THE FACTS OF THE CASE. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDIT ION OF RS.45,40,173/- ON ACCOUNT OF NON-RECONCILIATION OF CREDITS AS PER TDS CERTIFICATES OF RELEVANT PERIOD WITH REG ARD TO GROSS WORK DONE AND SHOWN IN THE P&L ACCOUNT. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW THE LD. CIT(A) HAS ERRED IN DECIDING APPEAL WHE REAS ASSESSMENT RECORD WAS NEVER SENT TO THE OFFICE OF L D. 2 CIT(A) AND NO REMAND REPORT WAS SENT ASKED FOR BY T HE LD. CIT(A) 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE LD. CIT(A) HAS ERRED IN ALLOWING PROPORTIO NAL CREDIT OF TDS AMOUNT TO RS.122998/- DISALLOWED BY T HE AO.. 5. IT IS PRAYED THAT THE ORDER OF THE LD. CIT(A) BE SET ASIDE AND THAT OF THE AO MAY BE RESTORED. 6. THE APPELLANT CARVES LEAVE TO ADD OR AMEND ANY GROUND OF APPEAL BEFORE THE APPEAL IS HEARD OR IS DISPOSED OFF. 3. GROUND NOS. 1, 5 AND 6 ARE GENERAL IN NATURE, HE NCE WE DEEM IT FIT NOT TO ADJUDICATE THE SAME. THEREFORE, THE SAME ARE DISMISSED. 4. IN GROUND NO.2, REVENUE CONTENDED THAT THE CIT(A ) ERRED IN DELETING ADDITION OF RS.45,40,173/- ON ACCOUNT O F NON- RECONCILIATION OF CREDITS AS PER TDS CERTIFICATE OF THE RELEVANT PERIOD WITH REGARD TO GROSS WORK DONE AND SHOWN IN THE PROFIT & LOSS ACCOUNT. 5. IN THE COURSE OF PRESENT APPELLATE PROCEEDINGS, LD. 'DR' RELIED UPON THE ASSESSMENT ORDER PASSED BY AO. LD. 'AR' CONTENDED THAT REQUISITE RECONCILIATION WAS DONE AN D PRODUCED BEFORE THE LOWER AUTHORITIES. HENCE, THERE IS NO JU STIFICATION FOR THE IMPUGNED ADDITIONS. 6. WE HAVE CAREFULLY PERUSED THE RIVAL SUBMISSIONS, FACTS OF THE CASE AND RELEVANT RECORD. IN THE COURSE OF ASSE SSMENT PROCEEDINGS, THE AO NOTICED CERTAIN DISCREPANCIES A S PER GROSS AMOUNT RECEIVED FOR THE FINANCIAL YEAR 2006-07 IN T ERMS OF TDS CERTIFICATES AND THE AMOUNT CREDITED TO THE PROFIT & LOSS ACCOUNT 3 FOR THE RELEVANT PERIOD, AS GROSS WORK DONE. THE D IFFERENCE OF RS.45,40,173/- WAS ADDED TO THE INCOME OF THE ASSES SEE BEING NOT SATISFIED WITH THE EXPLANATION FILED BY THE ASS ESSEE. THE FINDINGS OF THE CIT(A), AS CONTAINED IN PARA 8 OF T HE APPELLATE ORDER, ARE REPRODUCED HEREUNDER, WHEREBY THE IMPUGN ED ADDITION WAS DELETED: I HAVE GONE THROUGH THE ASSESSMENT RECORDS, COPIES OF LEDGER ACCOUNT OF THE APPELLANT, SUPPLIED BY M/S JK PAPER LTD. AND COPY OF LEDGER ACCOUNT OF M/S JK PAPER LTD . IN THE BOOKS OF THE APPELLANT AS WELL AS DETAILED DATE-WIS E STATEMENTS OF WORK DONE DURING THE YEAR ENDED 31.3. 2007 UNDER DIFFERENT HEADS. I FIND NO DISCREPANCY IN ANY OF THE FIGURES SHOWN IN TDS CERTIFICATE OR IN THE ACCOUNT OF THE ASSESSEE IN THE BOOKS OF M/S JK PAPER LTD. OR THE A CCOUNTS OF M/S JK PAPER LTD. IN THE BOOKS OF THE APPELLANT. IT APPEARS THAT THE AO COULD NOT APPRECIATE THE ADJUST MENTS SHOWN IN THE ACCOUNTS. THE AO IN ANY OPINION WAS WR ONG IN WORKING OUT THE SUPPOSED FIGURE OF INCOME. THE A O COULD NOT JUSTIFY THE DEDUCTION OF RS.5491002/- WHICH WAS AN ADVANCE GIVEN BY M/S JK PAPER LTD. AND SHOWN AS A LIABILITY IN THE BALANCE SHEET. THE DISCREPANCY BET WEEN GROSS AMOUNT SHOWN IN TDS CERTIFICATE AND GROSS AMO UNT SHOWN IN PROFIT & LOSS ACCOUNT OUGHT TO HAVE BEEN A DDED BY THE AO BUT AS POINTED OUT EARLIER, THE AO COULD NOT APPRECIATE THE EXPLANATION OR ADJUSTMENTS OF THE AM OUNT. I AM SATISFIED THAT THERE WAS NO DISCREPANCY IN SHOWI NG THE INCOME UNDER THE HEAD GROSS WORK DONE IN PROFIT & L OSS ACCOUNT. IN FACT COPY OF LEDGER ACCOUNT OF THE APPE LLANT CALLED FOR U/S 133(6) OF THE INCOME-TAX ACT,1961 SU PPORTS THE EXPLANATION OF THE APPELLANT. THE APPEAL IS THEREFORE DECIDED IN FAVOUR OF THE AP PELLANT ON THIS GROUND GIVING RELIEF OF RS.45,40,173/-. 7. THE CIT(A) HAS GIVEN CATEGORICAL FINDING THAT TH E AO FAILED TO APPRECIATE THE ADJUSTMENTS SHOWN IN THE ACCOUNTS . 4 CONSEQUENTLY, IT WAS HELD BY THE CIT(A) THAT THE AO WAS WRONG IN WORKING OUT THE SUPPOSED FIGURE OF DISCREPANCY IN T HE RECEIPT. THE AO COULD NOT JUSTIFY THE DEDUCTION OF RS.54,91, 002/- WHICH WAS AN ADVANCE GIVEN BY M/S JK PAPER LTD. AND SHOWN AS LIABILITY IN THE BALANCE-SHEET. IN A NUT-SHELL, TH E ALLEGED DISCREPANCY NOTICED BY THE AO STANDS RECONCILED. I N VIEW OF THIS, THE IMPUGNED ADDITION CANNOT BE SUSTAINED AND HENCE FINDINGS OF THE CIT(A) ARE UPHELD. THIS GROUND OF APPEAL RAISE D BY THE REVENUE IS DISMISSED. 8. IN GROUND NO.3, REVENUE CONTENDED THAT THE CIT(A ) ERRED IN DECIDING APPEAL WHEREAS THE ASSESSMENT RECORD WAS N EVER SENT TO THE OFFICE OF THE CIT(A) AND NO REMAND REPORT WAS C ALLED FOR BY THE CIT(A). THIS GROUND OF APPEAL RAISED BY THE REV ENUE IS WITHOUT SPECIFYING THE SPECIFIC ITEM OF DISCREPANCY , WHICH IS AT VARIANCE WITH THE ASSESSMENT RECORD AND THE EVIDENC ES FILED BEFORE THE CIT(A). ACCORDINGLY, THIS GROUND OF APP EAL IS DISMISSED. 9. IN GROUND NO.4, REVENUE CONTENDED THAT THE CIT(A ) ERRED IN ALLOWING PROPORTIONATE CREDIT OF TDS AMOUNTING TO R S.1,22,998/- DISALLOWED BY THE AO. THE AO HAS DISALLOWED THE IM PUGNED PROPORTIONATE CREDIT CORRESPONDING TO THE AMOUNT OF RS.54,91,002/- EXPLAINED AS ADVANCE RECEIVED BY THE ASSESSEE FROM M/S JK PAPER LTD. THE ASSESSEE WAS CARRYING O N THE BUSINESS OF CIVIL CONSTRUCTION WORK FOR M/S JK PAPE R LTD. THE ADVANCE RECEIVED AND TAX DEDUCTED AT SOURCE HAD BEE N ACCOUNTED FOR IN THE BOOKS, HENCE THE LD. 'AR' SUBMITS THAT T HERE IS NO JURISDICTION IN REFUSING TO ALLOW THE CREDIT FOR TA X DEDUCTED AT SOURCE. THE CIT(A) HAS GIVEN CATEGORICAL FINDING TH AT THE TDS 5 CERTIFICATES ARE ON RECORD AND REFUSAL TO GIVE CRED IT FOR SUCH TDS AMOUNTING TO RS.1,22,998/ HAS NO LINK WITH THE ALLE GED SUPPRESSION OF CONSTRUCTION WORK RECEIPT OF RS.45,4 0,173/-. HOWEVER, IT IS ADDED THAT AN ALLEGED DISCREPANCY WH ICH WAS TREATED AS INCOME OF THE ASSESSEE BY THE AO WAS DEL ETED BY THE CIT(A). CONSEQUENTLY, THIS GROUND OF APPEAL IS ALS O DISMISSED. 10. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 14 TH DEC.,2011. SD/- SD/- (SUSHMA CHOWLA) (MEHAR SINGH) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 14 TH DEC.,2011. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT ,DR ASSISTANT REGISTRAR, ITAT CHANDIGARH