Dynamic Agro International , Sidhpur V. The Income Tax Officer, Ward-2, Patan

ITA 1902/AHD/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 1609 (ITAT-AHMEDABAD)
• Duration Of Justice: 10 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-05-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 05-04-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 26-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Depreciation; Opportunity of being heard; Revised return

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHM EDABAD , (BEFORE SHRI ANIL CHATURVEDI, A.M. & SHRI KUL BHARA T, J.M.) ( , !'# $ , ! %& ) ITA NO. 1902/AHD/2015 (ASSESSM ENT YEAR: 2010-11) DYNAMIC AGRO INTERNATIONAL PLOT NO. 295, B/H GIDC, SUJANPUR ROAD, POST GANGLASAN, SIDDHPUR 384151 VS. INCOME-TAX OFFICER, WARD-2, PATAN 384265 PAN NO. AABFD5600N (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI TEJ SHAH, A.R. RESPONDENT BY : SHRI KEYUR PATEL, SR. D.R. DATE OF HEARING : 05-04 -2016 DATE OF PRONOUNCEMENT : 03 -05-2016 ( )/ ORDER PER ANIL CHATURVEDI, ACCOUNTANT MEMBER THIS APPEAL FILED BY ASSESSEE IS AGAINST THE ORDER OF CIT(A), GANDHINAGAR, DATED 25.02.2015 FOR THE ASSESSMENT YEAR 2010-11 . 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERI ALS ON RECORD ARE AS UNDER: 3. THE ASSESSEE IS A COMPANY STATED TO BE ENGAGED I N THE BUSINESS OF PROCESSING OF AGRO COMMODITIES. THE ASSESSEE ELECT RONICALLY FILED ITS RETURN OF INCOME FOR A.Y. 2010-11 ON 30.09.2010 DECLARING TOT AL INCOME AT RS.5,45,060/- ASSESSEE ON 12.10.2010 FILED A THE REVISED RETURN OF INCOME, WHEREIN IT DECLARED TOTAL INCOME AT RS.6,97,770/-. THE CASE WAS SELECT ED FOR SCRUTINY AND THEREAFTER, ITA NO.1902/AHD/15 A.Y. 2010-11 (DYNAMIC AGRO INTE RNATIONAL VS. ITO) 2 THE ASSESSMENT WAS FRAMED U/S.143(3) OF THE ACT VID E ORDER DATED 28.03.2013 AND THE TOTAL INCOME WAS DETERMINED AT RS.69,65,383/-. AGGRIEVED BY THE ORDER OF ASSESSING OFFICER, ASSESSEE CARRIED THE MATTER BEFO RE THE LD. CIT(A) WHO VIDE ORDER DATED 25.02.2015 (IN APPEAL NO. CIT(A)/GNR/16 7/2013-14) DISMISSED THE APPEAL OF THE ASSESSEE. AGGRIEVED BY THE ORDER OF LD. CIT(A), ASSESSEE IS NOW IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUN DS : 1) THE LD CIT (A), GANDHINAGAR HAS ERRED IN LAW AN D UPON FACTS IN PRESUMING THAT THE APPELLANT DO NOT WISH TO PERSUE THE MATTER BEFO RE THE LD CIT(A) AND HAS FURTHER ERRED IN STATING THAT THE APPELLANT IS SIMPLY BUYIN G TIME IN AS MUCH AS THE LD CIT(A) LASTLY ADJOURN HEARING ON 10/02/2015 AND ON DAY BEF ORE THE DATE OF HEARING AN ADJOURNMENT LETTER SEEKING ADJOURNMENT OF 1 MONTH I S FILLED WHICH HAS BEEN NOT ENTERTAINED AND REJECTION IS NOT INTIMATED TO THE A PPELLANT. THE NON ATTENDANCE BEING FOR REASONABLE AND SUFFICIENT CAUSE, THE APPEAL DECIDED AGAINST THE APPELLANT ON THIS COUNT BE HELD TO BE NOT IN ACCORDANCE WITH THE PROVISIONS OF LAW. WITHOUT PREJUDICE TO ABOVE THE LD CIT(A) AND INCOME TAX OFFICER HAVE ERRED IN UPHOLDING THE INCOME ADDITION MADE BY THE ASSESSING OFFICER AND DISMISSING THE APPEAL FILLED BY THE APPELLANT ON MERITS OF THE CASE ALSO. THE SPECIFIC GROUNDS ARE 2) THE LD CIT(A) HAS ERRED IN UPHOLDING AN AMOUNT O F RS. 2080967/- BEING COMMISSION EXPENSE DISALLOWED BY AO WITHOUT GIVING REASONABLE OPPORTUNITY OF BEING HEARD AND WITHOUT ANY MATERIAL EVIDENCE ON RECORD F OR SUCH DISALLOWANCE. 3) THE LD CIT(A), GANDHINAGAR HAS ERRED IN FACTS AN D UPON LAW IN CONFIRMING THE GENUINE BUSINESS TRUCK FREIGHT REVENUE EXPENSE OF R S. 3789450/- U/S 40(A)(IA) OF THE ACT FOR NON DEDUCTION OF TDS EVEN THOUGH THE TRANSPORTE RS ARE ASSESSED TO TAX HAVING PANO NOT REQUIRING TO DEDUCT TAX AT SOURCE WITH EFFECT F ROM 01/10/2009 UNDER THE STATUTORY AMENDMENT FOR RS. 1695200/- OUT OF WHICH PAYABLE AM OUNT IS RS. 628250/-. WHEREAS THE FREIGHT AMOUNT UP TO 30/39/2009 OF RS. 2022300/- WH ICH IS PAID OFF AND NOT PAYABLE AT THE CLOSE OF THE ACCOUNTING YEAR AND NOT LIABLE FOR DISALLOWANCE U/S 40(A)(IA). MORE PARTICULARLY SEVERAL HIGH COURTS HAVE HELD THAT PRO VISIONS OF DISALLOWANCE ARE NOT ATTRACTED WHEN SUCH PAYMENTS ARE MADE AND NOT PAYAB LE. 4) THE LD CIT(A), GANDHINAGAR HAS ERRED IN CONFIRMI NG THE DISALLOWANCE OF HAMALI EXPENSE OF RS. 13848/-EVEN THOUGH THE SAME STANDS R ECONCILE AND EXPLAIN. 5) THE LD. CIT(A), GANDHINAGAR HAVE ERRED IN CONFIR MING THE DISALLOWANCE OF RS. 180240/-MADE BY THE ITO OUT OF CLAIM OF INTEREST EX PENSE ON FUNDS BORROWED FOR BUSINESS PURPOSES BUT LOWER AUTHORITIES DISALLOWING THIS CLAIM GIVING REASON THAT INTEREST FREE ADVANCES ARE MADE EVEN THOUGH THERE A RE SUFFICIENT OWN FUNDS AND CONSISTENTLY ALLOWED IN THE PAST AND THAT THE ADVAN CES ARE NOT FORM THE BORROWED FUNDS AND THAT CERTAIN ADVANCES OUT OF THIS ADVANCES ARE BUSINESS ADVANCES. ITA NO.1902/AHD/15 A.Y. 2010-11 (DYNAMIC AGRO INTE RNATIONAL VS. ITO) 3 6) THE LD CIT(A), GANDHINAGAR HAS ERRED BOTH IN LAW AND UPON FACTS IN CONFIRMING DISALLOWANCE OF DEPRECIATION CLAIM BY AN AMOUNT OF RS. 203108/- FOR ALLEGED FIXED ASSET NOT PUT TO USE. EVEN THOUGH THE REASON GIVEN BY AO FOR DISALLOWANCE IS FACTUALLY AND LEGALLY INCORRECT. PRAYER: YOUR APPELLANT PRAY THAT THE SEVERAL DISALL OWANCE AND INCOME ADDITION MADE BY ASSESSING OFFICER AND CONFIRM BY CIT (A) AG GREGATING RS. 6267613/- BE HELD TO BE ILLEGAL AND THE ENTIRE CLAIM BE HELD TO BE ALLOW ABLE ON ALL THE GROUNDS. 4. BEFORE US, AT THE OUTSET, LD.AR SUBMITTED THROUG H VARIOUS GROUNDS HAVE BEEN RAISED BY ASSESSEE BUT ONE OF THE GRIEVANCES OF TH E ASSESSEE IS THAT LD. CIT(A) HAS PASSED AN EX PARTE ORDER AS ASSESSEE COULD NOT APPE AR BEFORE HIM AND THAT LD. CIT(A) HAS NOT DECIDED THE APPEAL ON MERITS. THE R EASON FOR NON-APPEARANCE BEFORE LD. CIT(A) AS STATED BY LD. A.R. IS THAT THE AR HAD SOUGHT ADJOURNMENT ON VARIOUS DATES BEFORE CIT(A) AND HE HAD KEPT THE ASS ESSEE IN DARK WHILE SEEKING THE ADJOURNMENT. IN SUPPORT OF THE AFORESAID CONTE NTION, THE SWORN AFFIDAVIT OF ADITYA DEVKINANDAN WADHWA, THE PARTNER OF ASSESSEE- FIRM IS PLACED ON RECORD. THE LD.AR, THEREFORE, SUBMITTED THAT IN THE INTERES T OF JUSTICE, ASSESSEE BE GRANTED ONE MORE OPPORTUNITY TO PRESENT ITS CASE BEFORE LD. CIT(A) AND FURTHER ASSURED THAT ASSESSEE WILL APPEAR BEFORE LD. CIT(A). LD. D.R., ON THE OTHER HAND, SUBMITTED THAT DESPITE VARIOUS OPPORTUNITIES GRANTED TO ASSES SEE, ASSESSEE DID NOT APPEAR BEFORE LD. CIT(A) AND THEREFORE LD. CIT(A) HAD NO O THER OPTION BUT TO DISMISS THE APPEAL OF THE ASSESSEE. HE, THUS, SUPPORTED THE OR DER OF LD. CIT(A) . 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. IN THE PRESENT CASE, WE FIND THAT LD. CIT(A) HAS PASSED AN EX-PARTE ORDE R AND DISMISSED THE APPEAL OF THE ASSESSEE WITHOUT GOING INTO THE MERITS OF THE ISSUE. IT IS A SETTLED LAW THAT LD. CIT(A) HAS NO JURISDICTIO N TO DISMISS THE APPEAL OF THE ASSESSEE WITHOUT GOING INTO THE MERITS OF THE ISSUE BEFORE HIM. EVEN IN AN EX PARTE ORDER THE LD. CIT(A) SHOULD HAVE DECIDED THE GROUND S OF APPEAL OF THE ASSESSEE ON MERITS THEREOF BY A SPEAKING ORDER. CONSIDERING TH E AFORESAID FACTS, WE ARE OF THE ITA NO.1902/AHD/15 A.Y. 2010-11 (DYNAMIC AGRO INTE RNATIONAL VS. ITO) 4 VIEW THAT IN THE LARGER INTEREST OF JUSTICE, THE AS SESSEE BE GIVEN ONE MORE OPPORTUNITY TO PRESENT ITS CASE BEFORE LD. CIT(A). WE THEREFORE REMIT ALL THE GROUNDS RAISED IN THE PRESENT APPEAL BACK TO THE FI LE OF LD. CIT(A) FOR HIM TO DECIDE THE ISSUE AFRESH ON MERITS AND IN ACCORDANC E WITH LAW. NEEDLESS TO STATE THAT LD. CIT(A) SHALL GRANT ADEQUATE OPPORTUNITY OF HEARING TO BOTH THE PARTIES. IN VIEW OF OUR DECISION TO RESTORE THE VARIOUS GROUNDS RAISED BY ASSESSEE TO LD. CIT(A), WE ARE NOT ADJUDICATING ON MERITS THE GROUN DS OF THE APPEAL RAISED BY THE ASSESSEE. 6. THUS, THE APPEAL OF ASSESSEE IS ALLOWED FOR STAT ISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON - 04 - 201 6. SD/- SD/ - (KUL BHARAT) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD: DATED /04/2016 ORDER PRONOUNCED ON 03/05/2016 SD/- S D/- SKY AC (JM) (AM) S K SINHA COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) GANDHINAGAR 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER //TRUE COPY// DEPUTY/ASSTT.REGISTRAR ITAT,AHMEDABAD 1.DATE OF DICTATION REMIT BACK AND DECIDE ON MERIT FORMAT 2.DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE TH E OTHER MEMBER 11-04-2016 3.DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S. 4.DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 5.DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR .P.S./P.S 6.DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 7.DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8.THE DATE ON WHICH THE FILE GOES TO THE ASSTT. REG ISTRAR FOR SIGNATURE ON THE ORDER 9.DATE OF DESPATCH OF THE ORDER