Md. Tabark, West Singhbhum V. ACIT, Jamshepur

ITA 16/RAN/2013

• Counselvise Citation: 1625114 RSA 2013
• Duration Of Justice: 2 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-05-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 26-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 194C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI CIRCUI T BENCH, RANCHI (BEFORE SHRI P.K.BANSAL, HONBLE A.M.& SHR I D,T. GARASIA, HONBLE J.M.) I.T.A. NO. 16/RAN/2013 : ASSESSMENT YEAR 2009 -10 MD. TABARAK, PROP: M/S. KOLHAN TRANSPORT -VS- ACIT, CIRCLE-2, JSR WEST SINGHBHUM (APPELLANT) PAN: ADZPT 4370Q (RESPONDENT) APPELLANT BY : SHRI S.K.PODDAR WITH SHRI M.K.CH OWDHURY, ADVOCATE RESPONDENT BY : SHRI VIJAY, D.R. DATE OF CONCLUDING THE HEARING : 29.04.2013 DATE OF PRONOUNCING THE ORDER : 03.05.2013 O R D E R PER BENCH : THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A), JAMSHEDPUR DATED 31.12.2012 FOR THE ASSESSMENT YEAR 2009-10. 2. GROUND NOS. 1 TO 6 RELATE TO THE ISSUE REGARDING THE DISALLOWANCE MADE UNDER SECTION 40(A)(IA) AMOUNTING TO RS.96,78,419/- IN RE SPECT OF TRANSPORT CHARGES PAID BY THE ASSESSEE BUT NO TDS HAS BEEN DEDUCTED UNDER SEC TION 194C. THE ASSESSEE CLAIMED BEFORE THE ASSESSING OFFICER THAT THERE WAS NO CONTRACT. THE ASSESSEE HAS FOR THE HIRING OF THE TRUCKS, HAS RECEIVED COMMISSION/ BROKERAGE @200 TO 300% FOR ARRANGING THE TRUCKS ON HIRE TO TRANSPORT. THE ASSE SSING OFFICER NOTICED THAT THE ASSESSEE MADE THE PAYMENT IN EXCESS OF RS.20,000/- ON A SINGLE OCCASION AND IN EXCESS RS.50,000/- AGGREGATE DURING THE FINANCIAL Y EAR AS HIRE CHARGES TO THE 25 PARTIES AMOUNTING TO RS.98,76,419/-, THE DETAILS OF WHICH ARE GIVEN IN THE ORDER OF THE CIT(A) AT PAGE 2. THE ASSESSING OFFICER TOOK THE VI EW THAT THE ASSESSEE DEFAULTED THE DEDUCTION OF THE TAX AT SOURCE UNDER SECTION 19 4C OF THE INCOME-TAX ACT. THEREFORE, AO DISALLOWED A SUM OF RS.98,76,419/- OU T OF RS.1,74,34,500/- CLAIMED BY THE ASSESSEE AS TRANSPORT CHARGES. THE ASSESSEE WENT IN APPEAL BEFORE THE CIT(A) WHO CONFIRMED THE ADDITION. 3. THE LD. A.R. BEFORE US RELIED ON THE ORDER OF TH E PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT-VS- UNITED RICE LAND LTD. 372 IT R 594 (P&H) AND OTHER CASES. FOR THE PROPOSITION OF THE LAW THAT IN THE ABSENCE OF ANY WRITTEN OR ORAL CONTRACT FOR A SPECIFIED PERIOD, QUANTITY, PRICE OR THAT A SINGLE PAYMENT THAT EXCEEDED RS.20,000/-. THE ASSESSEE WAS NOT TO BE REGARDED AS A DEFAULTER UNDER SECTION 194C OF THE INCOME- TAX ACT. THE RELIANCE WAS ALSO PLACED IN THE CASE O F CIT-VS- BHAGWATI STEELS 326 ITR 108 AGAINST WHICH THE SLP FILED BY THE DEPARTME NT WAS DISMISSED BY THE HONBLE SUPREME COURT AS REPORTED IN 336 ITR 14 (ST ATUTES). RELIANCE WAS ALSO PLACED ON THE FOLLOWING DECISIONS. I. CIT-VS- BHAGWATI STEELS 326 ITR 108 II. CIT-VS- HARDARSHAN SINGH [2013] 30 TAXMANN.CO M 245 (DELHI) III. CIT-VS- TRUCK OPERATORS UNION 339 ITR 532 (P &H) IV. CIT-VS- GREWAL BROTHERS (2011) 240 CTR 325 (P& H) THE LD. D.R. RELIED ON THE ORDERS OF THE AUTHORITIE S BELOW. WE HAVE CAREFULLY PERUSED THE MATERIALS AVAILABLE ON RECORD ALONG WITH THE OR DERS OF THE TAX AUTHORITIES BELOW. NO EVIDENCE WAS BEING BROUGHT BEFORE US BY THE LD. D.R. WHICH MAY PROVE THAT THEE WAS ANY CONTRACT WRITTEN OR ORAL BETWEEN THE ASSESS EE AND THE TRUCK OWNERS FOR HIRING OF THE TRUCKS SO THAT IT MAY BE SAID THAT THE ASSES SEE IS LIABLE TO DEDUCT TAX AT SOURCE WHEN THE SINGLE PAYMENT EXCEEDS RS.20,000/- OR AGGR EGATE PAYMENT EXCEEDS RS.50,000/-. THE HONBLE PUNJAB & HARYANA HIGH COUR T IN THE CASE OF BHAGWATI STEELS 326 ITR 108 HELD THAT IN THE ABSENCE OF ANY WRITTEN OR ORAL CONTRACT FOR SPECIFIED PERIOD, QUANTITY, PRICE OR THAT OF A SING LE PAYMENT EXCEEDING RS.20,000/-. THE ASSESSEE WAS NOT TO BE REGARDED AS DEFAULTER UN DER SECTION 194C OF THE INCOME TAX ACT AND IN CONSEQUENCE THE DISALLOWANCE UNDER S ECTION 40(A)(IA) CANNOT BE MADE. AGAINST THE DECISION, THE REVENUE WENT BEFORE THE HONBLE SUPREME COURT. THE HONBLE SUPREME COURT DISMISSED THE SLP AS REPO RTED IN 336 ITR 14 (STATUTES). IN VIEW OF THIS POSITION OF LAW, WE ARE GOING TO FO LLOW THE DECISION OF THE HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF BHAGAWAT I STEELS ( SUPRA ). WE ACCORDINGLY, RESPECTFULLY FOLLOWING THE SAID DECISI ON, DELETE THE DISALLOWANCE MADE IN RESPECT OF TRANSPORT CHARGES. 4. THE SECOND ISSUE IN GROUND NOS.7 TO 10 RELATES T O THE DISALLOWANCE OF RS.12,76,000/- OUT OF LOADING AND UNLOADING CHARGES UNDER SECTION 40(A)(IA). THE FACTS RELATING TO THESE GROUNDS ARE THAT THE ASSESS ING OFFICER NOTED THAT THE ASSESSEE HAS PAID LOADING AND UNLOADING CHARGES EXCEEDING RS .20,000/- DURING THE FINANCIAL YEAR TO THE 14 PARTIES AS GIVEN UNDER PARA 4.1 OF C IT(A)S ORDER BUT THE ASSESSEE DID NOT DEDUCT THE TDS UNDER SECTION 194C OF THE INCOME TAX ACT. THEREFORE, THE ASSESSING OFFICER DISALLOWED THE SAID AMOUNT AMOUNT ING TO RS.12,76,700/-. THE ASSESSEE WENT IN APPEAL BEFORE THE CIT(A) WHO CONFI RMED THE ORDER OF THE ASSESSING OFFICER. 5. WE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY CON SIDERED THE SAME. RESPECTFULLY FOLLOWING THE DECISION OF THE HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT-VS- BHAGWATI STEELS 326 ITR 108 WHE REIN THE HONBLE PUNJAB & HARYANA HIGH COURT HELD THAT IN THE ABSENCE OF WRIT TEN OR ORAL CONTRACT FOR A SPECIFIC PERIOD, QUANTITY, PRICE OR THAT A SINGLE PAYMENT EX CEEDED RS.20,000/-, THE ASSESSEE WAS NOT TO BE REGARDED AS A DEFAULTER UNDER SECTION 194C OF THE INCOME-TAX ACT AND IN CONSEQUENCE THE DISALLOWANCE UNDER SECTION 40(A) (IA) CANNOT BE MADE. IN VIEW OF OUR FINDINGS GIVEN IN OUR PRECEDING PARAGRAPH REGAR DING TRANSPORT CHARGES AND RELYING ON THE DECISION IN THE CASE OF BHAGWATI STE ELS ( SUPRA ), WE DELETE THE DISALLOWANCE. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE COURT ON 3 RD MAY, 2013. SD/- SD/- [D.T.GARASIA] [P.K.BANSAL] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 3 RD MAY, 2013 COPY OF ORDER FORWARDED TO : 1. MD. TABARAK, PROP: M/S. KOLHAN TRANSPORT, WEST SING HBHUM 2. ACIT, CIRCLE-2, JSR 3. C.I.T.(A), 4. THE .C.I.T., RANCHI 5. THE D.R., I.T.A.T., TRUE COPY, BY ORDER, [MST, SR.PS] SR. PRIVATE SECRETARY (ON T OUR) ITAT, RANCHI