ITO, Ward-9(1), Kolkata, Kolkata V. M/s. Manak Publicity Services Pvt. Ltd., Kolkata

ITA 1748/KOL/2009

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 62092 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 5 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-04-2012
• Appeal Filed By: Department
• Bench Allotted: C
• Next Hearing Date: 30-03-2010
• Assessment Year: 2005-2006
• Appeal Filed On: 14-10-2009
• Court: TRIBUNAL
• Department Lawyers: A K MAHAPATRA LD DR
• Assessee Lawyers: SUBASH AGARWAL LD

Judgement Text

, C , , IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH- C , CALCUTTA () BEFORE .., , SHRI C.D. RAO, ACCOUNTANT MEMBER. ! ! ! ! /AND '#'$ 1&', ) SHRI GEORGE MATHAN, JUDICIAL MEMBER !( / ITA NO. 1748/KOL/09 )'# *+/ ASSESSMENT YEAR: 2005-06 INCOME-TAX OFFICER, WARD 9(1), KOLKATA MANAK PUBLICITY SERVICES (P) LTD. PAN: AACCM-0730G (&- / APPELLANT ) - ' - - VERSUS -. (/0&-/ RESPONDENT ) &- 1 2 / FOR THE APPELLANT: / SHRI A.K. MAHAPATRA, LD.DR /0&- 1 2 / FOR THE RESPONDENT: / SHRI SUBASH AGARWAL,LD.AR 3'4 1 /DATE OF HEARING : 10-04-2012 5* 1 /DATE OF PRONOUNCEMENT: 13-04-2012 6 / ORDER '#'$ 1&', ) SHRI GEORGE MATHAN, JUDICIAL MEMBER.: THIS IS AN APPEAL FILED BY THE REVENUE AGAINST ORDE R OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS)-VIII, KOLKATA IN APPEAL NO.647 /CIT(A)-VIII/KOL/07-08 DATED 28-08-09 FOR THE ASSESSMENT YEAR 2005-06.. 2. SHRI A.K MAHAPATRA, LEARNED CIT/DR REPRESENTS ON BEHALF OF THE REVENUE AND SHRI SUBASH AGARWAL, ADVOCATE REPRESENTS ON BEHALF OF T HE ASSESSEE. 3. IN THE REVENUES APPEAL, THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPEAL:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A)-VIII, KOLKATA ERRED IN DELETING THE ADDITION OF RS.1,13,23,713 RE LATING TO JOB CONTRACT RECEIPT WITHOUT APPRECIATION THE NATURE OF BUSINESS . ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A)-VIII, KOLKATA ERRED IN DELETING THE ADDITION OF RS.1,02,554/- REL ATING TO GENERAL EXPENSES, LABOUR CHARGES, STAFF WELFARES AND TRAVELLING & CON VEYANCE. ITA NO.1748/KOL/09C-GM 2 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A)-VIII, KOLKATA ERRED IN DELETING THE ADDITION OF RS.12,303/- RELAT ING TO TELEPHONE CHARGES AND RS.18,000/- RELATING TO MOTOR CAR EXPENSES. 4. IT WAS SUBMITTED BY THE LEARNED DR THAT THE ASSE SSEE IS IN THE BUSINESS OF MANUFACTURING OF PUBLICITY AND ADVERTISING MATERIALS. IT WAS THE SUBMISSIONS IN THE COURSE OF ASSESSMENT, THE ASSESSING OFFICER HAD MADE THE ADDITION REPRESEN TING THE SUPPRESSED CONTRACT JOB WORK AMOUNT OUTSIDE THE BOOKS OF ACCOUNT BY TAKING INTO CONSIDERATION THE CLAIM OF TDS CREDIT MADE BY THE ASSESSEE. IT WAS THE FURTHER SUBMISSI ON THAT THE ASSESSING OFFICER HAD ALSO MADE DISALLOWANCE OF 10% OUT OF THE TELEPHONE EXPENSE S, 5% OUT OF THE GENERAL EXPENSES, LABOUR CHARGES, STAFF WELFARE AND TRAVELLING & CONVEYANCE. IT WAS THE SUBMISSIONS THAT AS THE TURNOVER DISCLOSED BY THE ASSESSEE DID NOT CORRESPOND WITH THE TDS CREDIT CLAIM, THE ASSESSING OFFICER HAD MADE AN ADDITION OF RS. 1,13,23,713/- TO THE TO TAL INCOME OF THE ASSESSEE TREATING THE SAME AS SUPPRESSED CONTRACT JOB WORKS AMOUNT. IT WAS TH E FURTHER SUBMISSIONS THAT LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) HAS DELETED T HE SAME BY RELYING UPON THE REMAND REPORT TAKEN FROM THE ASSESSING OFFICER. IT WAS THE SUBMISSIONS THAT LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) OUGHT NOT TO HAVE BLINDLY FO LLOW THE REMAND REPORT, BUT HE SHOULD HAVE DONE VERIFICATION OF HIS OWN ALSO. IT WAS FURTHER SUBMISSION IN REGARD TO THE DISALLOWANCE MADE BY THE ASSESSING OFFICER OUT OF THE TELEPHONE EXPENSES AND OTHER GENERAL EXPENSES, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) HAD DE LETED THE SAME BY HOLDING THAT THERE WAS NO DEFECTS POINTED OUT BY THE ASSESSING OFFICER OR IN THE AUDIT REPORT WITH REFERENCE TO THE BOOKS AND NO PERCENTAGE ESTIMATED DISALLOWANCE WA S PERMITTED. THE LEARNED DR VEHEMENTLY SUPPORTS THE ORDER OF THE ASSESSING OFFI CER. IT WAS THE SUBMISSIONS THAT THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) WAS LIABLE TO BE REVERSED. IN REPLY, THE LEARNED AR SUBMITTED THAT IN THE REMAND PROCEEDING S ALL THE DETAILS HAVE BEEN PRODUCED BEFORE THE ASSESSING OFFICER AND THE ASSESSING OFFI CER AFTER VERIFYING THE DETAILS SUBMITTED, IN HIS REMAND REPORT, PAGES 21-24 OF THE PAPER BOO K, SPECIFICALLY MENTIONED THAT THE CONTRACT RECEIPTS HAD BEEN ACCOUNTED FOR BY THE ASSESSEE AND THE SALES AS REFLECTED IN THE P & L ACCOUNT IS INCLUSIVE OF THE CONTRACT RECEIPTS. IN REGARD T O THE DISALLOWANCES OUT OF TELEPHONE EXPENSES AND OTHER GENERAL EXPENSES, LABOUR CHARGES, STAFF W ELFARE AND TRAVELLING & CONVEYANCE, IT WAS ITA NO.1748/KOL/09C-GM 3 THE SUBMISSIONS THAT NO SPECIFIC DEFECTS HAVE BEE N POINTED OUT IN THE ACCOUNTS MAINTAINED BY THE ASSESSEE AND IN ABSENCE OF SPECIFIC DEFECTS POI NTED OUT NO ADHOC DISALLOWANCE WAS PERMISSIBLE. HE VEHEMENTLY SUPPORTS THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. ON PER USAL OF THE REMAND REPORT OF THE ASSESSING OFFICER AT PAGES 21-23 OF THE PAPER BOOK CLEARLY SHOWS THAT THE ASSESSEE HAS FILED SPECIFIC DETAILS INCLUDING RECONCILIATION AND PAR TY LEDGER OF SALES WITH THE PAPER BOOK BEFORE THE ASSESSING OFFICER AND AFTER EXAMINATION OF THE SALE BILL WITH THE PARTY LEDGER ACCOUNT, TDS CERTIFICATE AND DETAILS OF SALES, THE ASSESSING OFF ICER HAS COME TO CONCLUSION THAT CONTRACTUAL RECEIPTS HAVE ALREADY BEEN ACCOUNTED FOR BY THE ASS ESSEE. IT WOULD BE WORTHWHILE TO EXTRACT PORTION OF THE REMAND REPORT, WHICH IS AS FOLLOW:- HOWEVER, AS THE A/R OF THE ASSESSEE HAS FILED SPEC IFIC DETAILS INCLUDING RECONCILIATION AND PARTY LEDGER OF SALES WITH THE P APER BOOK AND THE ISSUE HAS BEEN REMANDED FOR COMMENTS, OPPORTUNITIES WERE GIVEN TO THE ASSESSEE TO APPEAR WITH BOOKS OF ACCOUNT AND SALE BILLS E TC TO EXPLAIN AND SUBSTANTIATE ITS POSITION. THE AUTHORSED REPRESENTA TIVE OF THE ASSESSEE APPEARED ON 13/04/2009 & 21/04/2009 WITH BOOKS OF ACCOUNT AND SALE BILLS. ON EXAMINATION OF SALE BILLS WITH PARTY LEDGER ACCO UNT, TDS CERTIFICATES AND DETAILS OF SALES AS FURNISHED BY THE PARTY, PRIMA F ACIE I AM CONSTRAINED TO SAY THAT THESE CONTRACTUAL RECEIPTS HAS ALREADY BE EN ACCOUNTED FOR BY THE ASSESSEE AND THE SALES AS REFLECTED IN THE P & L A CCOUNT IS INCLUSIVE OF CONTRACTUAL RECEIPTS. 6. ON PERUSAL OF THE REMAND REPORT AS EXTRACTED ABO VE, CLEARLY SHOWS THAT THE PRIMARY OBSERVATION OF THE ASSESSING OFFICER AS RAISED IN T HE ASSESSMENT ORDER HAS BEEN SATISFACTORILY EXPLAINED BY THE ASSESSEE BEFORE THE ASSESSING OFFI CER IN THE REMAND PROCEEDINGS. IT IS FURTHER NOTICED THAT THE ASSESSING OFFICER HAS CATEGORICAL LY ADMITTED TO THE FACTS IN THE REMAND PROCEEDINGS AND THAT THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) HAS DELETED THE ADDITIONS. WE MAY MENTION HERE THAT EVEN IN THE RE MAND REPORT THE ASSESSING OFFICER HAS NOT RAISED ANY FRESH ISSUE, WHICH COULD HAVE BEEN LOOKE D INTO BY THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) WHEN THE ISSUE, WHICH IS BEFOR E THE LEARNED COMMISSIONER OF INCOME- TAX (APPEALS) HAS BEEN ADMITTED IN FAVOUR OF THE AS SESSEE BY THE ASSESSING OFFICER IN THE REMAND PROCEEDINGS. IN THE CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE LEARNED COMMISSIONER ITA NO.1748/KOL/09C-GM 4 OF INCOME-TAX (APPEALS) WAS RIGHT IN DELETING THE A DDITIONS. IN THE CIRCUMSTANCES, THE FINDING OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ON THIS ISSUE STANDS CONFIRMED. 7. IN REGARD TO THE ADDITIONS REPRESENT THE ESTIMAT ED DISALLOWANCE OUT OF THE TELEPHONE EXPENSES, GENERAL EXPENSES, LABOUR CHARGES, STAFF W ELFARE AND TRAVELLING & CONVEYANCE, IT IS NOTICED THAT NO SPECIFIC ALLEGATIONS OR DEFECTS IN REGARD TO THE ACCOUNTS MAINTAINED BY THE ASSESSEE HAS BEEN POINTED OUT. IF ANY, DISALLOWANCE IS CALLED FOR, IT SHOULD BE SUPPORTED BY SPECIFIC FINDINGS BEING POINTED OUT, ADHOC DISALLO WANCE IS NOT PERMITTED. IN THE CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE FINDING OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) IN DELETING THE ADDITIONS ARE ON THE RIGH T FOOTING AND DOES NOT CALL FOR ANY INTERFERENCE. IN THE CIRCUMSTANCES, THE APPEAL OF T HE REVENUE STANDS DISMISSED. 8. IN THE RESULT, THE APPEAL OF THE REVENUE IS D ISMISSED. 7 6 3 8 3' 9 7: THIS ORDER IS PRONOUNCED IN OPEN COURT ON DT 13.-04 -2012 *PP/SPS 6 1 /)); <;*= / COPY OF THE ORDER FORWARDED TO: 1. . &- / THE APPELLANT : ITO, W 9(1), P-7 CHOWRINGHEE SQ, 5 TH FL., KOL-69. 2 /0&- / THE RESPONDENT- M/S. MANAK PUBLICITY SERVICES P VT. LTD 113B, MANOHAR DAS ST., KOL-7. 3 4. . )6' / THE CIT, )6' ( )/ THE CIT(A) 5 . >)9 /)' / DR, KOLKATA BENCH 6 . GUARD FILE . 0; /)/ TRUE COPY, 6'3/ BY ORDER, 7 !' / ASSTT REGISTRAR . SD/- SD/- ( .. ) ) ( C.D.RAO, ACCOUNTANT MEMBER) ( '#'$ 1&' , ) (GEORGE MATHAN, JUDICIAL MEMBER) ( (( ( ) )) ) DATE13- 04-2012