ACIT, CHENNAI V. M/s. Blue Marine Logistics Pvt. Ltd., CHENNAI

ITA 1550/CHNY/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 61094 (ITAT-CHENNAI)
• Duration Of Justice: 8 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-05-2012
• Appeal Filed By: Department
• Bench Allotted: C
• Next Hearing Date: 17-05-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 12-09-2011
• Court: TRIBUNAL
• Department Lawyers: K E B RENGARAJAN JR
• Assessee Lawyers: B RAMAR KISHNAN

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI BEFORE DR. O.K.NARAYANAN, VICE-PRESIDENT AND SHRI V.DURGA RAO, JUDICIAL MEMBER I.T.A. NO. 1550/MDS/2011 ASSESSMENT YEAR : 2007-08 AND C.O.NO.144/MDS/2011 THE ASSISTANT COMMISSIONER OF INCOME-TAX, COMPANY CIRCLE-I(2), CHENNAI 34. VV VS. M/S. BLUE MARINE LOGISTICS PVT. LTD., HARIRAM BUILDINGS, 2 ND FLOOR, 16/3, COLLEGE ROAD, CHENNAI 600 006. PAN AACCB6921G (APPELLANT) (RESPONDENT/CROSS OBJECTOR) APPELLANT BY : SHRI KEB REN GARAJAN, JR. STANDING COUNSEL RESPONDENT BY : SHRI B. RAMAR KISHNAN, FCA DATE OF HEARING : 17 TH MAY, 2012 DATE OF PRONOUNCEMENT : 17 TH MAY, 2012 O R D E R PER DR. O.K.NARAYANAN, VICE PRESIDENT THE APPEAL IS FILED BY THE REVENUE. THE CROSS OBJ ECTION IS FILED BY THE ASSESSEE. THE RELEVANT ASSESSMENT YEA R IS 2007-08. THE APPEAL AND THE CROSS OBJECTION ARE DIRECTED AGA INST THE ORDER ITA 1550 & CO 144/11 :- 2 -: OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-III AT CHENNAI DATED 27.6.2011 AND ARISE OUT OF THE ASSESSMENT COMPLETED UNDER SEC.143(3) OF THE INCOME-TAX ACT, 1961. 2. IN THE APPEAL FILED BY THE REVENUE, THE GROUND R AISED IS THAT THE COMMISSIONER OF INCOME-TAX(APPEALS) HAS ERRED I N DELETING THE DISALLOWANCE MADE BY THE ASSESSING OFFICER UNDE R SEC.40(A)(IA) ON ACCOUNT OF NON DEDUCTION OF TAX AT SOURCE BY THE ASSESSEE IN RESPECT OF STEVEDORING EXPENSES, TRANSP ORTATION CHARGES AND COMPRESSOR HIRE CHARGES. IT IS THE CA SE OF THE REVENUE THAT THE COMMISSIONER OF INCOME-TAX(APPEALS ) HAS ERRED IN COMING TO A CONCLUSION THAT THE WORD PAYA BLE USED IN SEC.40(A)(IA) MEANS OUTSTANDING AND THAT THE AMOU NT OF DISALLOWANCE SHOULD BE RESTRICTED TO AMOUNTS SHOWN BY THE ASSESSEE AS OUTSTANDING. 3. THE ISSUE RAISED BY THE REVENUE IS COVERED IN FA VOUR OF THE ASSESSEE BY THE SPECIAL BENCH DECISION OF THE TRIBU NAL IN THE CASE OF MERILYN SHIPPING & TRANSPORTS V. ADDL. CIT (2012-TIOL- 184-ITAT-VIZAG-SB). THE SPECIAL BENCH HAS HELD THA T THE DISALLOWANCE CANNOT BE MADE IN RESPECT OF SUCH AMOU NTS WHICH ITA 1550 & CO 144/11 :- 3 -: HAVE ALREADY BEEN PAID AND THE PROVISIONS OF LAW ST ATED IN SEC.40(A)(IA) APPLY ONLY TO AMOUNTS PAYABLE. IN VIEW OF THE ABOVE, WE FIND THAT THE APPEAL OF THE REVENUE IS LI ABLE TO BE DISMISSED. 4. IN THE CROSS OBJECTION FILED BY THE ASSESSEE, TH E FIRST GROUND IS THAT THE COMMISSIONER OF INCOME-TAX(APPEALS) HAS ERRED IN NOT APPRECIATING THAT THE EXPENSES DISALLOWED ARE NOT C OVERED BY SECTIONS 30 TO 38 AND, THEREFORE, SHOULD NOT HAVE B EEN DISALLOWED UNDER SEC.40(A)(IA). 5. THE SECOND GROUND RAISED BY THE ASSESSEE IS THAT THE COMMISSIONER OF INCOME-TAX(APPEALS) HAS ERRED IN NO T CONSIDERING THE CERTIFICATE UNDER SEC.197(1) ISSUED BY THE ITO(TDS), TUTICORIN TO TUTICORIN PORT TRUST AND ITS AGENTS ENABLING PAYERS TO MAKE PAYMENTS TO THE PORT TRUST WITHOUT D EDUCTION OF TAX AT SOURCE. THE ASSESSEE IS DIRECTED TO PRODUCE CLARIFICATORY CERTIFICATE EITHER BY TUTICORIN PORT TRUST OR BY TH E ASSESSING COMMISSIONER OF INCOME-TAX, COMPANY CIRCLE-I AT TUT ICORIN TO THE EFFECT THAT THE ASSESSEES CLAIM IS ALSO INCLUDED I N THE LIST AND ATTACHED TO THE ASSISTANT COMMISSIONER AND IN THE L IGHT OF THE ITA 1550 & CO 144/11 :- 4 -: ABOVE CERTIFICATE, THE ASSESSING OFFICER MAY GIVE R ELIEF TO THE ASSESSEE. 6. IN RESULT, THE APPEAL FILED BY THE REVENUE IS DI SMISSED AND THE CROSS OBJECTION FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF H EARING ON THURSDAY, THE 17 TH OF MAY, 2012 AT CHENNAI. SD/- SD/- (V.DURGA RAO) JUDICIAL MEMBER (DR. O.K.NARAYANAN) VICE-PRESIDENT CHENNAI, DATED THE 17 TH MAY, 2012 MPO* COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR