A.C.I.T.-3, Mathura V. M/s S.D.Cold Storage Pvt. Ltd., Mathura

ITA 181/AGR/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 56957 (ITAT-AGRA)
• Duration Of Justice: 10 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-03-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 26-03-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 19-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE : SHRI BHAVNESH SAINI, JUDICIAL MEMBER & SHRI A. L. GEHLOT, ACCOUNTANT MEMBER ITA NO. 181/AGRA/2011 ASST. YEAR : 2006-07 A.C.I.T. 3, MATHURA. VS. M/S. S.D. COLD STORAG E (P) LTD. GOVIND GANJ, MATHURA. (PAN : AACCS 6201 J) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI WASEEM ARSHAD, SR.D.R. RESPONDENT BY : WRITTEN SUBMISSIONS DATE OF HEARING : 26.03.2012 DATE OF PRONOUNCEMENT OF ORDER : 30.03.2012 ORDER PER BHAVNESH SAINI, J.M. : THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LD. CIT(A)-I, AGRA DATED 24.01.2011 FOR THE ASSESSMENT YEAR 2006- 07 ON THE FOLLOWING EFFECTIVE GROUNDS OF APPEAL : 1. THAT THE CIT(APPEALS)-1, AGRA HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.9,93,266/- MAD E ON ACCOUNT OF RENT ON POTATOES BAG STORAGE WITHOUT APPRECIATING THE FA CTS OF THE CASE PROPERLY. 2. THAT THE CIT(APPEALS)-1, AGRA HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.2,92,092/- MADE ON A CCOUNT OF SHORTAGE OF RENT DECLARED WITHOUT APPRECIATING THE FACTS OF THE CASE PROPERLY. 3. THAT THE CIT(APPEALS)-1, AGRA HAS ERRED IN LAW AND ON FACTS IN DELETING THE DISALLOWANCE OF RS.9,247/- MADE OUT OF TELEPHONE ITA NO. 181/AGRA/2011 2 EXPENSES FOR PERSONAL USE WITHOUT APPRECIATING THE FACTS OF THE CASE PROPERLY. 2. WE HAVE HEARD THE LD. DR AND PERUSED THE FINDING S OF THE AUTHORITIES BELOW. NONE APPEARED ON BEHALF OF THE ASSESSEE. THE ASSESS EE HAS FORWARDED THE WRITTEN SUBMISSION, WHICH IS TAKEN INTO CONSIDERATION. 3. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE AO M ADE ADDITION OF RS.9,93,266/- BECAUSE IT WAS FOUND THAT THE ASSESSEE WAS HAVING T WO COLD STORAGES ONE AT MATHURA AND OTHER AT CHIPRAMAU. THE CHARGING OF REN T AT BOTH THE COLD STORAGES WAS FOUND TO BE DIFFERENT FOR POTATOES BAGS. THE AS SESSEE JUSTIFIED THE CHARGING OF DIFFERENT RATES OF RENT FOR STORAGE OF POTATOES BEC AUSE OF THE CAPACITY OF THE COLD STORAGES AND THE SITUATION OF THE COLD STORAGES. TH E AO DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE AND MADE THE ADDITION. T HE ASSESSEE EXPLAINED THE ISSUE BEFORE THE LD. CIT(A) AND IT WAS ALSO SUBMITTED THA T SIMILAR ADDITION WAS MADE IN PRECEDING ASSESSMENT YEARS 2005-06, IN WHICH THE LD . CIT(A) DELETED THE NOTIONAL ADDITION MADE AND THE ITAT, AGRA BENCH CONFIRMED TH E ORDER OF THE LD. CIT(A) IN ITA NO. 624/AGRA/2008 VIDE ORDER DATED 27.08.2010. COPY OF THE SAME IS ALSO PLACED ALONG WITH THE WRITTEN SUBMISSIONS. THE LD. CIT(A) FOUND THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE AND THAT THE AO C ANNOT ENTER INTO THE SHOES OF ASSESSEE FOR REJECTION OF BOOKS OF ACCOUNT AND CHAR GING OF HIGHER RENT FOR STORAGE OF POTATOES BAGS. THE ADDITION OF RS.9,93,266/- WAS , ACCORDINGLY, DELETED. WITH ITA NO. 181/AGRA/2011 3 REGARD TO THE ADDITION ON GROUND NO. 2 OF RS.2,92,0 92/-, IT WAS EXPLAINED THAT THERE WAS A MISTAKE IN COMPUTATION OF RENT BEING CHARGED AT CHIPRAMAU COLD STORAGE. THE DETAILED SUBMISSIONS WERE MADE BEFORE THE LD. C IT(A) EXPLAINING THE ISSUE. THE LD. CIT(A) AFTER VERIFICATION FROM THE STORAGE REGISTER OF THE COLD STORAGE, FOUND THE CONTENTION OF THE ASSESSEE TO BE CORRECT AND DELETED THE ADDITION BECAUSE THERE WAS MISTAKE BY THE AO IN COMPUTING THE RENT. THE ADDITION WAS, ACCORDINGLY, DELETED. WITH REGARD TO DISALLOWANCE OF TELEPHONE E XPENSES, IT WAS EXPLAINED THAT THE ASSESSEE HAS ALREADY PAID ADDITIONAL INCOME-TAX IN THE SHAPE OF FRINGE BENEFIT TAX AND, THEREFORE, FURTHER ADDITION SHOULD NOT BE MADE ON ACCOUNT OF PERSONAL USER. THE LD. CIT(A), ACCORDINGLY, DELETED THE ADDITION O N ACCOUNT OF DISALLOWANCE OF TELEPHONE EXPENSES. 4. THE LD. DR RELIED UPON THE ORDER OF THE AO AND T HE ASSESSEE IN THE WRITTEN SUBMISSIONS, REITERATED THE SUBMISSIONS MADE BEFORE THE LD. CIT(A). 5. ON CONSIDERATION OF THE SUBMISSIONS OF THE PARTI ES NOTED ABOVE, WE DO NOT FIND ANY MERIT IN THE DEPARTMENTAL APPEAL. THE AO C ALCULATED THE NOTATIONAL RENT ON ACCOUNT OF DIFFERENT RENT CHARGED FOR TWO COLD STOR AGES MAINTAINED BY THE ASSESSEE. THERE WAS NO BASIS, WHATSOEVER, FOR PRESUMING THAT THE ASSESSEE CHARGED HIGHER RENT FOR MATHURA COLD STORAGE. SIMILAR ISSUE WAS CO NSIDERED IN THE PRECEDING ASSESSMENT YEAR 2005-06, IN WHICH THE LD. CIT(A) DE LETED THE SIMILAR ADDITION AND ITA NO. 181/AGRA/2011 4 THE ORDER OF THE LD. CIT(A) HAS BEEN CONFIRMED BY T HE TRIBUNAL BY DISMISSING THE DEPARTMENTAL APPEAL. THEREFORE, THERE IS NO JUSTIFI CATION TO INTERFERE WITH THE ORDER OF THE LD. CIT(A) ON GROUND NO. 1. FURTHER ON GROUN D NO. 2, THE ASSESSEE FILED DETAILED SUBMISSIONS TO SHOW THAT THERE WAS A MISTA KE IN COMPUTATION OF RENT, WHICH WAS CLARIFIED AND THE LD. CIT(A) AFTER VERIFI CATION OF THE FACTS FROM THE STORAGE REGISTER FOUND THAT THERE WAS A MISTAKE IN COMPUTING THE RENT AND ACCORDINGLY, THE ADDITION WAS DELETED. NO MATERIAL IS PRODUCED BEFORE US TO CONTRADICT THE FINDING OF FACT RECORDED BY THE LD. CIT(A) IN THIS REGARD. THEREFORE, THERE IS NO JUSTIFICATION TO INTERFERE WITH THE ORD ER OF THE LD. CIT(A). AS REGARDS THE DISALLOWANCE OF TELEPHONE EXPENSES, SINCE DISALLOWA NCE ON ACCOUNT OF PAYMENT OF FRINGE BENEFIT TAX IS ALREADY MADE BY THE ASSESSEE, THEREFORE, FURTHER ADDITION IS NOT REQUIRED IN THE MATTER. ACCORDINGLY, THERE IS N O MERIT IN GROUND NO. 3 OF THE REVENUE ALSO. IN THE ABSENCE OF ANY MATERIAL IN SUP PORT OF THE ORDER OF THE AO AND CONSIDERING THE ABOVE DISCUSSION, WE DO NOT FIND AN Y JUSTIFICATION TO INTERFERE WITH THE ORDER OF THE LD. CIT(A) IN DELETING ALL THE ADD ITIONS. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (A.L. GEHLOT) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER *AKS/- ITA NO. 181/AGRA/2011 5 COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A), CONCERNED BY ORDER 4. CIT, CONCERNED 5. DR, ITAT, AGRA 6. GUARD FILE ASSISTANT REGISTRAR TRUE COPY