Shri Nitinkumar Rameshchandra Mehta, Ahmedabad V. The Income tax Officer,Ward-9(1), Ahmedabad

ITA 18/AHD/2010

• Counselvise Citation: 1820514 RSA 2010
• Duration Of Justice: 2 year(s) 4 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-05-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 18-04-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 01-01-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P L KUREELSR
• Assessee Lawyers: NIMESH VAYAMWALA
• Keywords: Difference of opinion
• Section: 37

Judgement Text

, C, IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, C BENCH . . , , ! ! ! ! '# '#'# '# , #$ #$ #$ #$ % % % % # ## # BEFORE S/SHRI G.C. GUPTA, VICE-PRESIDENT AND TEJ RAM MEENA, ACCOUNTANT MEMBER) ITA NO.18/AMD/2010 [ASSTT.YEAR : 2006-2007] NITINKUMAR RAMESHCHANDRA MEHTA PROP. OF M/S NITIN CONSTRUCTION C-1, ASHIRWAD APARTMENT, MIRAMBICA ROAD, NARANPURA AHMEDABAD PAN. ABHPM8896Q /VS. ITO, WARD 9(1) AHMEDABAD. ( &' &' &' &' / APPELLANT) ( ()&' ()&' ()&' ()&' / RESPONDENT) *' + , # / ASSESSEE BY : SHRI NIMESH VAYAMWALA, AR % + , # / REVENUE BY : SHRI. P.L. KUREEL,SR.-DR - + '.$ / DATE OF HEARING : 18 TH APRIL, 2012 /01 + '.$ / DATE OF PRONOUNCEMENT : 23.05.2012 #3 / O R D E R PER T.R. MEENA, ACCOUNTANT MEMBER: (1) THE GROUNDS APPEAL ARE AS UNDER:- (I) THE LD. A.O. HAD ERRED IN COMPUTING THE TOTAL INCOME THAT OF RS.14,20,960/- AGAINST THE INCOME THAT OF RS.1,58,6 87/-. (II) THE C.I.T. (A) ERRED IN CONFIRMING THE DISALL OWABLE OF RS.11,62,274/- U/S 40(A) (IA) OF THE ACT. THE C.I.T. (A) OUGHT TO HAVE APPRECIATED THAT PAYMENTS ITA NO.18/AHD/2010 ASSTT. YEAR: 2006-07 2 MADE WERE NOT FOR DOING ANY WORK BUT FOR RENT OF MA CHINE & SUPPLY OF MATERIAL. THE ADDITION OUGHT TO BE DELETED. (III) THE LD. C.I.T.(A) HAS ERRED IN CONFIRMING DI SALLOWANCE OF RS.100000/- PAID TO M/S POOJA CONSTRUCTION. THE C.I.T. (A) OUG HT TO HAVE APPRECIATED THAT NEITHER ASSESSMENT ORDER NOT IN THE REMAND REPORT T HE A.O. HAS NOT EXAMINED THE INVOICE OF M/S POOJA CONSTRUCTION. THE DISALLOWANC E MAY BE DIRECTED TO BE DELETED. 2. THIS IS ONE APPEAL FILED BY THE ASSESSEE AGAINS T ORDER OF THE CIT(A)- XV, AHMEDABAD DATED 03.11.2009 FOR THE ABOVE ASSESS MENT YEAR. THE FACTS ARE THAT THE ASSESSEE MADE PAYMENT TO VARIOUS PARTIES F OR EXPENDITURE AT RS. 1262274 AND NO TDS WAS DEDUCTED U/S 40(A) (IA) OF IT ACT BY HIM. THE AO WAS FOUND VIOLATION THE PROVISIONS OF 194 R.W.S. 40(A)(IA) OF THE ACT. THE WHOLE AMOUNT HAS BEEN DISALLOWED UNDER THIS SECTION. 3. BEING AGGRIEVED FROM THE ORDER OF THE AO, THE A SSESSEE FILED APPEAL BEFORE CIT(A) XV AHMEDABAD. THE CIT(A)-XV AHMD. ALS O CONFIRMED THE ADDITION BECAUSE THE PAYMENTS WERE MADE TO SUB-CONTRACTOR EN GAGED BY THE APPELLANT THROUGH COMPOSITE BILLS WHICH CAN NOT BE BROKEN INT O PURCHASE/RENT/LABOUR/CARTAGE ETC. AS GENUINENESS OF PAYMENT OF RS.100000 IN CASE OF POOJA CONSTRUCTION ITSELF IS NOT SATISFACTORILY PROVED THE ADDITION OF SAME IS C ONFIRMED U/S 37. 4. THE A.R. CONTENDED THAT THERE IS NO AMOUNT PAYA BLE AS ON 31.03.2006. HE FURNISHED THE COPY OF ACCOUNTS OF ALL THE PARTIE S AS ON 31.03.2006. HE AGAIN RELIED UPON HONBLE ITAT JAIPUR A BENCH DECISION IN THE CASE OF VIDYUT VITRAN LTD. VS. DCIT DATED 30.04.2009, 26 DTR (JP) (TRIB.) 79 AND CLAIMED THAT TDS PROVISION OF SECTION 40(A)(IA) IS APPLICABLE ON AMO UNT PAYABLE NOT PAID DURING THE PREVIOUS YEAR. HE ALSO FILED COPY OF ORDER OF SPEC IAL BENCH ITAT VISHAKHAPATTNAM, ITA 477/VIZ./2008 DATED 14.03.2012. IN THIS CASE T HERE WAS A DIFFERENCE OF OPINION BUT MAJORITY OF MEMBERS DECIDED THAT SECTION 40(A)( IA) OF THE ACT IS APPLICABLE ON ITA NO.18/AHD/2010 ASSTT. YEAR: 2006-07 3 THE EXPENDITURE WHICH IS PAYABLE ON 31 ST MARCH OF VERY YEAR AND CANNOT BE INVOKED TO DISALLOW THE AMOUNTS WHICH HAVE ALREADY PAID DUR ING THE PREVIOUS YEAR. 5. THE LD. D.R. RELIED UPON THE ORDERS OF THE A.O. AND THE C.I.T.(A) AND REQUESTED TO CONFIRM THE ADDITION. 6. WE HAVE HEARD BOTH THE SIDES AND GONE THROUGH T HE CASE LAW CITED BY THE A.R. BOTH THE HONBLE ITATS HAVE TAKEN VIEW THAT THIS SECTION IS APPLICABLE ON EXPENDITURE PAYABLE AS ON 31 ST MARCH OF EVERY YEAR AND CANNOT BE INVOKED TO DISALLOW THE AMOUNTS WHICH HAVE ALREADY BEEN PAID D URING THE PREVIOUS YEAR WITHOUT DEDUCTING THE TAX ON SOURCE. THE C.I.T.(A) ALSO CONFIRMED THE ADDITION OF RS.1 LAKH U/S 37 OF THE I.T. ACT. THE A.R. CLAIMED THAT THIS ISSUE WAS NEVER EXAMINED BY THE A.O. THEREFORE, THE MATTER IS SET A SIDE TO THE A.O. TO RE-DECIDE THE MATTER AFTER CONSIDERING THE LEGAL POSITION AS DISC USSED ABOVE AND NOT TO MAKE ADDITION U/S 40(A)(IA) ON AMOUNTS PAID BEFORE THE E ND OF THE RELEVANT ACCOUNTING PERIOD BY THE ASSESSEE. ACCORDINGLY, THE MATTER IS SET ASIDE WITH DIRECTION TO GIVE REASONABLE OPPORTUNITY TO THE ASSESSEE AND PASS NEC ESSARY ORDER IN ACCORDANCE WITH LAW. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN OPEN COURT ON 23.05.2012 SD/- SD/- (G.C. GUPTA) (T.R. MEENA) VICE PRESIDENT ACCOUNTANT MEMBER ITA NO.18/AHD/2010 ASSTT. YEAR: 2006-07 4 TRUE COPY N.K. CHAUDHARY, SR. P.S. COPY OF THE ORDER FORWARDED TO: 1) : APPELLANT 2) : RESPONDENT 3) : CIT(A) 4) : CIT CONCERNED 5) : DR, ITAT. BY ORDER DR/AR, ITAT, AHMEDABAD STRENGTHEN PREPARATION & DELIVERY OF ORDERS IN THE ITAT 1) DATE OF TAKING DICTATION 2) DIRECT DICTATION BY MEMBER STRAIGHT ON COMPUTER/LAPTOP/DRAGON DICTATE YES 3) DATE OF TYPING & DRAFT ORDER PLACE BEFORE MEMBER 4) DATE OF CORRECTION 5) DATE OF FURTHER CORRECTION 6) DATE OF INITIAL SIGN BY MEMBERS 7) ORDER UPLOADED ON 23.5.12 8) ORIGINAL DICTATION PAD HAS BEEN ENCLOSED IN THIS FILE 9) FINAL ORDER AND 2 ND COPY SEND TO BENCH CLERK ON 23.5.12